Last Tuesday, the European Parliament (EP) approved the new Regulation that establishes the . This is a rule aimed at strengthening industrial readiness, stimulating the acquisition and joint manufacturing of capabilities and consolidating the strategic autonomy of the Union. It sounds dense, but in reality its effect is effervescent: it comes to revolutionize companies in the sector, facilitating their work, amplifying purchases made in Europe and prioritizing projects that, four years ago, were just plans in a drawer.
And what happened almost four years ago? That the Russian president, , invaded Ukraine, in the heart of Europe, an aspiring to be part of the community club, and Brussels understood that it had to do what the saying says about beards and neighbors. Since then, he has pushed his defense to unprecedented levels. “We are not doing it to launch a war, but to prepare for the worst, defend peace in Europe and stand firm in a world in which the law of the strongest cannot prevail,” in the words of the head of community diplomacy, .
Now, with a notable majority – 457 votes in favor, 148 against and 33 abstentions – a text comes forward that the Council has to formally endorse, before its publication in the Official Gazette. Pure procedure because the Twenty-Seven had already agreed. And it wasn’t easy.
Why it matters
We are talking about the first instrument of this nature in the history of the EU, which is framed in a distressing context due to the need to modernize the defense technological and industrial base, strengthen local manufacturing and increase support for an eastern ally like Ukraine, in particular and its ability to protect itself against external threats.
He (as he is known by his English acronym) comes to guarantee that Europe has sufficient weapons and material when it needs it, if it needs it, and that these supplies are timely, that is, in line with the times and threats, modern and compatible with the Armies of its neighbors and partners. Something that has already been in the works for decades but is now greatly accelerated, making deadlines or administrative processes more flexible and putting money on the table – of course – to grease the machinery.
In the , launched in March, the need for public-private participation, protectionism of one’s own industry, to release the burden of external dependence and to catch up is already contemplated. The matter was never the priority in the , but just as happened with health and the coronavirus pandemic, there are realities that upset the stakes. The underlying premise is that defense is fundamental to sovereignty. Until now, it has always been the prerogative of EU countries. In the decade after the , there was talk of a European Defense Community, but France firmly rejected it. Now, except for the farthest left, in the European institutions no one brings up the debate on rearmament or not rearmament, because it is an outdated debate. Now we only talk about how and why, not what.
The news
The EDIP will have a budget of 1.5 billion euros for the period 2025-2027, of which 300 million would be allocated to the Instrument to Support Ukraine, a booming industry, from which it can be extracted. The figures, in truth, are understood as initial, because the new model is called to radically change the way in which the EU budget is spent for the next seven years. For now, the goal is to promote technological capabilities in defensive matters and with the voice of now.
Among the agreements reached, the creation of a Fund to Accelerate the Transformation of Supply Chains in the field of Defense (the FAST instrument, whose name means fast in English) also stands out, to add an indicative amount of at least 150 million through additional financial contributions.
Parliament has also insisted on increasing the program’s budget through additional contributions from the “Security Action for Europe” (SAFE) instrument, which provides for loans to stimulate joint orders from the European military industry.
Furthermore, the program allows Member States to make the most of the (MRR) by diverting and reallocating unspent funds from that fund to finance defensive projects.
Visitors stand next to a Thales sign during the first day of the Defense and Security Equipment International trade show, September 14, 2021, in London.
The states and MEPs have agreed to prioritize the principle of “buy European”: to qualify for public financing in the acquisition of material, the cost of components from non-associated third countries cannot exceed 35% of the total estimated cost, or conversely, at least 65% of the project must be from Europeans and their partners. The fundamental idea is to reduce dependence on foreign countries and, in the process, ensure employment on EU soil.
This point has been the subject of important disputes within the Union, again at two speeds, at two opinions: while there were countries like France that advocated for practical disconnection from other partners such as the United States or the United Kingdom, others like the Netherlands defended that we had to be more flexible, that it is okay to continue looking for material abroad and even less so if this makes friends happy (starting with the North American). Same position as Poland, due to proximity, where they emphasize the need to equip themselves with capabilities as soon as possible, even if this requires buying abroad.
The middle point that has satisfied everyone is high, but not total, so there is still a degree of uncertainty, especially having in the White House a president like Donald Trump, transactional, who crushes his historical allies – such as Europe – if necessary for his interests. The last great example, so that they buy weapons from their country and then send them to Ukraine. I sell, you pay.
The program will establish a legal framework for European projects of common interest in the field of defence. To access financing, they must have the participation of at least four Member States. Ukraine may also be part of these projects. The regulation will also create a Ukraine Support Instrument to help modernize the Ukrainian defense industry and facilitate integration with its European counterpart.
Finally, the program will establish a legal framework for European projects of common interest in the field of defence. To access financing, they must have the participation of at least four Member States. Ukraine will also be able to be part of these projects, a gesture of friendship and cooperation with those who need help, have to contribute and, in addition, intend to join the EU sooner rather than later. The regulation will also create a Ukraine Support Instrument to help modernize the Ukrainian defense industry and facilitate integration with its European counterpart.
The argument
The Commission presented the first draft of this plan in March 2024 and was clear that it wanted an instrument to work in the long term. Over the months, it had been equipped with more short-term tools, such as (“as soon as possible”), dedicated to the purchase of ammunition, or the instrument for strengthening the European defense industry through common acquisitions.
Marie-Agnes Strack-Zimmermann, German MEP from the centrist Renew and chair of the parliamentary committee on Security and Defence, explains that the document represents “an important step towards a more efficient, faster and truly European approach to public defense procurement and the strengthening of European defense capabilities.” “It is designed to have a lasting impact, serve as a reference point for future initiatives and shape the way European cooperation in defense production is organized after 2027,” he says.
Raphaël Glucksmann, French from the Socialists and Democrats, co-rapporteur of the same commission, highlights that it is “the first truly European instrument of defense of the EU.” “In the face of Russia’s large-scale war against our neighbor and repeated attacks against our countries, we must strengthen common defense systems and increase our defense capabilities collectively,” he defends.
In his opinion, the contribution of the new text is that “it will allow us to build a more resilient and sovereign Europe, through joint investment, the common acquisition of the technological and industrial base of European defense and greater integration of the Ukrainian and European defense industries. This is essential to guarantee that we can protect our democracies in an effective and autonomous manner.”
François-Xavier Bellamy, also French but a member of the European People’s Party (EPP) group, a co-rapporteur in this case of the Industry, Research and Energy committee, describes what was voted as “a great step forward for the security of the European continent and the development of our defense industry.” “After decades of dangerous dependencies that threatened the sovereignty of our democracies and the protection of our countries, the EDIP program will reverse the dependence on imports that prevailed in Europe. It will serve to reinforce our industrial base in a real way, which will allow us to autonomously guarantee that our armed forces have the means to fulfill their mission,” he defends.
Bellamy, however, warns the conservatives that the agreed amount. “Unfortunately, with a budget of €1.5 billion, a substantial gap remains between the ambition of the EDIP and the funding provided.” The truth is that, although it may seem like a lot, that barely pays for two American Patriot missile launchers. Given the threat we face, we cannot afford to wait for the European defense budget to be reinforced in 2028. It is time to act,” he emphasizes. His is the majority group.
The industry today
The European defense industry today is made up, above all, of powerful multinationals, mid-cap companies and more than 2,000 SMEs, reports the European Parliament. It is estimated that, jointly, they invoice some 70,000 million euros per year, in the context of countries that, each year, allocate 400,000 million euros to war spending.
Even so, the major world leaders in the sector are found in the United States, the United Kingdom, China and Russia. Of the hundred largest shapes in the world, only 27 of them are European. And of them, only one Spanish, . Among the top 20 at a global level, three European companies sneak in: Airbus (from Spain, France, Germany and the United Kingdom), in 12th place, the Italian Leonardo in 13th and the French Thales in 16th.
Until now, each Member State has worked individually on its relationship with these firms, especially in the case of reconversions and privatizations. To draft this regulation, it was necessary to debate issues ranging from protectionism to collaboration, from mergers to have a continental scale to pure and simple competition. European leaders, until now, have preferred fragmentation, with countries supporting national companies that are major suppliers to local armed forces. Their lives depend on those contracts. Now we are looking for cooperation that goes beyond borders and the domestic comfort zone to think big and reach as far as possible. The commitment to joint purchases is destined to change the rules of the current game.
It is expected that with the imminent entry into force of the new provisions, a new trend will be generated in the continental industry, betting on consortia and sums. From projects such as that of Airbus itself – especially large and ambitious and, therefore, difficult to replicate – or Future Combat Air Systems (FCAS), with counterparts such as the Spanish Indra.
Nobody says that it will be easy and that tensions will not arise. Competition will increase, but so will responses. And that, Europe says, is what it needs. Prompt and of the best quality. It is confident in this and right now the feeling is that it is not prepared: it revealed in October that 52% of Europeans are not convinced of the continent’s good military preparation. The poll was conducted just a week after .
