Brussels will require that at least 65% of joint defense procurement materials be of European production

Ane Barcos “If Europe wants peace, it must be prepared for war.” With this premise, Brussels presented this Wednesday the promised White Paper for European Defense – Readiness 2030 and the ReArm Europe Plan, as part of a comprehensive strategy to ensure greater coordination among Member States, the creation of a unified defense market, and the promotion of innovation in areas such as artificial intelligence, cybersecurity, and military mobility. Through this joint effort, the EU seeks not only to strengthen its defense capabilities but also to position itself as a more autonomous and resilient geopolitical actor in the face of the challenges of the 21st century. The White Paper on Defense establishes a roadmap to close military capability gaps and strengthen the European defense industry. It is based on the recognition that the continent's security depends on joint response capabilities and the development of a strong industrial base. Among its key pillars, it highlights the need for greater investment in the production of defense systems, the modernization of Member States' military capabilities, and improved interoperability among European militaries. Furthermore, it emphasizes the urgency of ensuring continued support for Ukraine, facilitating its access to European defense equipment and technology, as well as integrating its military industry into the European defense ecosystem. In this regard, it highlights the importance of harmonizing Member States' procurement processes in order to optimize resources and reduce the fragmentation of the defense market. The White Paper does not propose the creation of a European army, but rather seeks to strengthen national forces and their cooperation. The ReArm Europe Plan, complementary to the White Paper, seeks to provide the financial and structural means to realize this vision. The European Commission has designed a set of measures aimed at mobilizing up to €800 billion to strengthen Member States' defense capabilities in the short and medium term. This plan includes the activation of a clause in the Stability and Growth Pact that will allow Member States to increase their defense spending without compromising their fiscal stability. Specifically, national governments will be allowed to allocate up to 1.5% of their annual GDP for four years exclusively to defense investments. Brussels urged the 27 to request the activation of the National Escape Clause before the end of April. Joint procurement of military equipment The plan includes the establishment of the Security Action for Europe (SAFE) instrument, a financial mechanism that will allow Member States to access loans totaling €150 billion, backed by the EU budget. These loans will facilitate the joint procurement of military equipment, with the aim of improving interoperability between European armed forces, reducing costs, and ensuring greater predictability for the continent's defense industry. SAFE's operation stipulates that joint procurement must involve at least two Member States, although a single Member State can open its procurement process to Ukraine or EFTA countries. Furthermore, purchases must be made from industries in the EU, Ukraine, or the European Economic Area-EFTA (EEA-EFTA). To ensure that the equipment purchased primarily comes from European industry, in the case of war products for immediate consumption, at least 65% of the cost of the final product must come from components manufactured in the EU, EFTA, or Ukraine. In the case of complex systems, stricter control over design and development is imposed to avoid strategic dependencies on third countries. Integrating Ukraine into the European Defense Industry The plan seeks to strengthen cooperation with Kyiv's military-industrial sector, facilitating its access to financing and promoting the integration of Ukrainian companies into the European Defense Technology and Industrial Base (EDTIB). This includes the possibility for Ukraine to participate in joint procurement of military equipment and defense production within the EU, allowing Ukrainian companies to be eligible for tenders funded by instruments such as SAFE. Furthermore, Member States are expected to use funds obtained through SAFE to provide military equipment to Ukraine, accelerating the delivery of arms and other resources necessary for its defense against Russian aggression. Restrictions for other third countries Regarding other non-EU and non-EFTA countries, access to financing and participation in joint procurement will depend on bilateral agreements and their alignment with European strategic interests. The United States and the United Kingdom, although key allies, are not explicitly mentioned as beneficiaries of joint procurement initiatives, suggesting that the EU seeks to prioritize consolidating its own defense industrial base. Countries considered strategic competitors or that do not share democratic values with the EU, such as China or Russia, are excluded from these programs. The EU seeks to avoid technological or industrial dependencies that could compromise its strategic autonomy. Along with these mechanisms, the ReArm Europe Plan contemplates a central role for the European Investment Bank (EIB) and the mobilization of private capital through the Savings and Investment Union. The EIB is expected to expand its financing to security and defense projects, while the private sector will be incentivized to invest in companies in the sector, ensuring a continuous flow of capital that strengthens the competitiveness of the European defense industry.

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