European ministers breed on New Defense Plan: a European Wapenkoopclub

Anyone who thought that the European Union had solved its defense problem and had the financing with the invitation of Ursula von der Leyen to all EU countries to borrow 800 billion euros in the coming years will be disappointed. In the Polish Army Museum, in the old Citadel of Warsaw, it can be heard on Saturday that the search for money has just started.

« A growing number of countries believe that further steps are needed, » says Polish minister Andrzej Domanski, after he has challenged a meeting of the EU Ministers of Finance just before that. In addition to him, the European Commissioner for Economic Affairs, Valdis Dombrovskis nods: « We are also open to looking beyond the existing initiatives. »

The newest plan: a club of voluntary countries from inside and outside the EU, who will purchase weapons together and possibly also manage together. This should lead to more efficient purchasing policy and, through a new financial construction, will be more manageable for countries with high debts. Whether the Netherlands will participate in such a club, appears in Warsaw, depends on the conditions.

Membership

In fact, the Ministers of Finance who met on Saturday have been standing for the same problem on Saturday: they are doing their best to make the new Defense Fenses of Europe financially feasible, but most have little room on their own budget to release many extra defense bins year after year.

Last month, the European government leaders in Brussels were on rapid speed about a large redundancy plan, REARM EUROPE. That plan is already released more money by creating extra loan room and through cheap loans from the European Commission. But many countries are still looking for ways to buy in more efficiently and to get less deeply in debt.

On the initiative of Poland, which holds the rotating EU presidency, the Brussels think tank Bruegel stated a report With the possibilities. It sets up a new initiative, outside the fixed form of the EU, as the most desirable option.

That ‘European Defense Mechanism’ (EDM) can immediately use the money from the participating countries to make purchases, and also use as collateral for loans – together borrowing together is again on the table. Countries such as the United Kingdom, Norway and Ukraine can also participate, while EU member states, such as Hungary, have the space not to do that.

The intention is that the investments end up with the participants as much as possible, so that their industry optimally benefits from the new Golf to defense money. The model that Bruegel has in mind would first of all focus on strategic and cross -border purchases for which coordination is logical, such as satellites and air defense systems.

Leading group

The first big advantage of such a new defense club, according to Bruegel, is that the central purchasing of weapons is much more efficient than if countries boost their defense investments independently of each other. Now Europe has a range of different tanks and weapon systems, because countries always operate separately when purchasing new material.

The Polish Minister of Finance Andrzej Domanski was the host of the meeting. His country is currently rotating chairman of the EU.

Photo Marcin Obara/EPA

That is also the reason that the Netherlands is not opposed to the proposal, says Eelco Heinen. The Dutch Minister of Finance is even enthusiastic about a number of components: « If you harmonize this in Europe and buy it together, you can go and get huge economies of scale, more safety for the same euro. »

Heinen does not see that the money would not be distributed through the EU, but through a separate club. On the contrary: where the European Commission has the power to push through its way to a certain extent, such a new model will probably get ‘more safety valves’ in which the Netherlands can block things that it does not like, according to the minister.

The participation of other countries – the British first – also views the Netherlands positively. It recently turned out that the Netherlands had consulted with the VK and some other countries about a similar British initiative. Here too, a leading group of benevolent countries would buy weapons together.

The Bruegel report describes another advantage: a European Defense Mechanism can borrow money independently and purchase it material, without the extra debt on the national budgets appearing. The countries that want to participate would pay a kind of membership fee to participate and to sit as a shareholder at the table. The European Commission could also join in this way, although that is more sensitive to some of the enthusiastic countries.

More hesitation can be heard about the financing, especially if borrowing from the European Stability Mechanism (ESM), a fund that was established during the euro crisis to come to the rescue of needy countries. This is one of the options that Bruegel suggests. The ESM itself sees that, not Heinen. « If you look at where it is going in the world, we are happy that we have such a construct and I say: let’s not address that for this. »

This time the Netherlands seems to be less alone than in being smothered resistance Against Rearm Europe. The German finance minister, Jörg Kukies, says a little further that he does not necessarily reject joint loans, but has not yet seen a clear substantiation.

The European Refarming Club, dreamed by Bruegel, is not a fact for a long time, becomes clear in Warsaw. The biggest proponents are now mainly in Eastern Europe. « The most nervous countries are the most positive, » a diplomat summarizes the relationships in the corridors. This can also be explained by a bonus that Bruegel proposes for these countries: countries that are borrowing to Russia and Belarus should be able to borrow interestless interest, as well as the countries with the highest defense budgets.

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