The European Defense Mechanism Will Contribute to the Formation of a Single Arms Market in the European Union

EU countries are discussing the introduction of an All-European financial instrument – the European Defense Mechanism (EDM), which should complement the already approved in the EU EUR 150 billion loan program within the framework of the EU Rearmament Plan. This mechanism should allow countries to purchase military equipment and vehicles in a centralized way, rather than individually.

The EDM should help create a single EU arms market, regulate the budget expenditures of each EU country, improve the compatibility of defense systems and pool resources.

Within the framework of a single financial instrument, EU countries will be able to carry out strategic planning and identify common defense needs, including the development and procurement of expensive equipment and advanced technologies. It is predicted that by 2030, Europe will be able to reduce its military dependence on the United States if it unifies its procurement system and creates a common European defense market.

Portugal and Poland have preliminarily supported the initiative. France, Germany, and Norway, on the other hand, believe that existing financial instruments, such as the European Investment Bank and the EU Rearmament Plan, should be implemented before creating new structures.

Spain has put forward an idea to create a new defense fund to provide non-refundable grants to strengthen the EU’s borders and support Ukraine by using the frozen assets of the russian central bank worth 200 billion.

Leaders of European countries are aware of the risks of the growing threat from russia, so the process of approving defense initiatives by Brussels is progressing, albeit slowly. Most countries support the general idea of the EDM, but agreeing on a financial model and legal mechanisms will require several rounds of negotiations.