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The proposal to increase defense spending by $840 billion is based largely on debt, according to the news outlet
European Commission President Ursula von der Leyen’s attempt to increase military spending across the EU is not backed by cash and shifts the financial burden to member states, Euractiv has reported, citing senior EU officials.
The so-called ‘ReArm Europe Plan,’ backed mostly by debt and fiscal adjustments, asks EU nations to spend $840 billion, twice the EU’s 2024 defense budget, to counter “grave security threats.”
The plan “includes close to no fresh money,” leaving member states to secure “the real cash” themselves, Euractiv reported on Wednesday.
The total figure is based more on “hopes and guesses” than concrete reforms addressing the bloc’s production shortages, the report argued.
Von der Leyen has also proposed raising $158 billion through capital markets and offering it to members as loans on condition they buy weapons made in the bloc or its regional allies.
The requirement could involve at least three EU countries or two EU countries plus Ukraine. However, loan approval criteria and the prioritization of EU-made equipment remain undecided, the report pointed out.
Defense spending will be given an “escape clause” from EU budget rules, allowing governments to shift funds “rather than coming up with fresh money,” according to Euractiv.
While increased deficits could generate nearly $700 billion, it’s uncertain if the measure applies to all countries or only those meeting NATO’s 2% GDP target.
Another senior EU official told Euractiv that over time, governments must offset spending by raising taxes or cutting costs.
Von der Leyen’s push for increased defense spending comes amid growing pressure from Washington. US President Donald Trump has distanced himself from supporting Ukraine while urging the EU to take greater responsibility for its defense.
The shift intensified this week, with news agencies’ reports on Monday suggesting that Trump had ordered a pause in military aid to Kiev. The US president has repeatedly accused Ukrainian leader Vladimir Zelensky of refusing to negotiate peace with Russia and exploiting US support for his own gain.
EU leaders will discuss von der Leyen’s proposals at a special summit on Thursday. According to a senior EU official, the measures should work “very fast and very efficiently” and require only a majority vote for adoption.
Some experts, however, warn that increasing military spending could strain national budgets already under pressure.
