Brussels is changing its spending policy to potentially redirect tens of billions of euros to defense and security amid Russia’s war against Ukraine and the return of Donald Trump to the White House, reports the Financial Times.
The policy change will affect about a third of the EU’s total budget, or approximately 392 billion euros for the period from 2021 to 2027—funds intended to reduce economic inequality between EU countries. So far, only about 5% of these so-called cohesion funds have been spent, with major recipients such as Poland, Italy, and Spain spending even less.
Under current rules, these funds cannot be used to purchase defense equipment or directly finance the armed forces, but investments in so-called dual-use items, such as drones, are allowed.
According to EU officials, in the coming weeks, EU member states will be informed that, in line with the rules, they will now be able to more flexibly allocate cohesion funds to support the defense industry and military mobility projects, such as strengthening roads and bridges to allow safe passage for tanks. This will include allowing funding for increasing the production of weapons and ammunition, although the ban on using EU funds for the purchase of such weapons will remain in place.
