On April 12, finance ministers of EU countries began negotiations on a joint defence fund. Named the "European Defence Mechanism", this fund will be used to purchase and own defence equipment, and charge member states usage fees, aiming to increase defence spending without adding to the debt burden.
On April 12, 2025, local time, in Warsaw, Poland, as part of Poland's tenure as the president of the EU Council, the Economic and Financial Affairs Council of the EU (ECOFIN) held an informal meeting at the Polish Army Museum. (Photo from Visual China)
It was reported that the "European Defence Mechanism" was proposed by a think - tank in a document submitted to an EU ministerial meeting. The aim is to address concerns about how highly indebted countries can afford expensive military equipment.
The Portuguese finance minister participating in the negotiations said on the 12th, "This is a good starting point for discussion." Several other EU countries also expressed initial support. Moreover, since the fund will be based on the model of the European Stability Mechanism, an aid fund for the eurozone, EU countries believe that setting up such a fund may be technically relatively simple. This fund may also cover non - EU members such as the UK, Ukraine, and Norway.
At the end of March, the head of the EU Commission stated after a summit that the participants had extensive discussions on how to increase short - term financial and military support for Ukraine. She also emphasized long - term support for Ukraine and the EU's own defence situation, reiterating that the "Plan to Re - arm Europe" is crucial. She said that the EU needs to have a reliable deterrence and defence stance and must therefore develop its own defence industry base.
The foreign policy of the current US administration has made EU governments realize that they can no longer rely entirely on the US for their security. However, the EU still has many concerns. The Portuguese finance minister said on the 12th, "We will still face some problems in terms of authorization, funding, contribution amounts, and market leverage of the 'European Defence Mechanism' fund. There are also some issues in financing and the military aspect."
The EU has planned to increase military spending by 800 billion euros (about 876 billion US dollars) in the next four years by relaxing fiscal restrictions in the defence investment field and jointly borrowing for large - scale defence projects using the EU budget. But these plans will increase national debt, which worries many highly indebted countries. The think - tank's plan provides a feasible way to remove some defence investments from national accounts.
