<h6><strong>Ane Barcos/Eduardo González</strong></h6> <h4><strong>The President of the Government, Pedro Sánchez, has sent a letter to the President of the European Commission, Ursula von der Leyen, in which he explains “the Spanish vision on the approach that Europe should give to security and the future European Defence Union”, which includes, among other proposals, “the mobilisation of genuine European funding in the next budget cycle”, a joint debt system similar to that adopted after COVID-19, the flexibility of national fiscal rules, the involvement of the European Investment Bank (EIB) and the attraction of private investment.</strong></h4> In his letter, which <em>Aquí Europa</em> and <em>The Diplomat in Spain</em> have had access to, the Spanish president emphasises that "security and defence are essential public goods and that only through the unity and courage of the Member States will it be possible to move towards a more sovereign Europe prepared to face current and future challenges". He also stressed that "the war of aggression against Ukraine constitutes the greatest threat to the continent at the moment", which is why Spain maintains "a firm commitment to achieving a fair and lasting peace". Sánchez proposes a comprehensive approach based on the Strategic Compass, which strengthens "deterrence and defence on both the eastern and southern flanks of Europe", also addressing issues such as industrial resilience, cybersecurity and the protection of strategic assets. He also advocates "genuine European funding for defence", suggesting "the mobilisation of a joint debt system similar to that adopted after COVID-19", the easing of national fiscal rules and a greater role for the European Investment Bank (EIB) in financing the sector. He also emphasises "the need to attract private investment to strengthen the European defence industry". As for financing, Sánchez proposes that "the next Multiannual Financial Framework (MFF) mobilise at least 2% of the EU's GDP to reinforce the bloc's defensive capabilities" and increase funding from the European Defence Fund. In addition, Spain supports "the creation of a support line in the European Stability Mechanism to strengthen economic security and explore complementary vehicles for the joint acquisition of capabilities." "To finance projects without affecting the financing of other priorities, the EIB's lending capacity must be increased by updating the definition of dual-use materials," says the head of the Executive, who also defends the implementation of "measures to boost private investment" in security and defence. On the other hand, and in order to protect the EU "against the possible consequences of new threats to security in terms of financial instability," Sánchez announces that "Spain supports the creation of a support line in the European Stability Mechanism to support economic security, following the model of the credit line to support the pandemic crisis." <h5><strong>Von der Leyen's plan to increase defence spending</strong></h5> For her part, the President of the European Commission announced on Tuesday the ReARM Europe plan, an initiative aimed at significantly increasing defence spending through a new financial instrument that will mobilise up to 150 billion euros in loans and could reach a total investment of 800 billion euros. In a letter sent to EU heads of state and government on Tuesday in the framework of the extraordinary European summit convened by António Costa on 6 March, von der Leyen stresses that Europe faces a significant threat that demands a new approach to security and defence. The ReARM Europe plan seeks to strengthen the defence capacity of Member States and ensure that Europe takes control of its own deterrence, without neglecting its transatlantic relations. The main measures of the plan include the activation of an escape clause in the Stability and Growth Pact to facilitate an increase in defence spending, as well as the mobilisation of public and private investment to strengthen the competitiveness of the European defence industry. In addition, EU cohesion programmes will be reviewed to redirect funds towards defence, removing restrictions and increasing financial incentives. The European Investment Bank will play a key role in expanding financing for defence projects, ensuring an additional source of resources for companies in the sector. Access to private capital will also be promoted with the aim of encouraging the growth and scalability of defence technology solutions. In this context, the completion of the Capital Markets Union will be promoted to attract more investment to the European economy. With this set of measures, the European Commission seeks to significantly increase defence spending and ensure that Europe is better prepared to face security challenges, consolidating its strategic autonomy and its capacity to respond to global threats.
