- The EU is preparing for potential military threats, with a focus on enhancing defence capabilities.
- The EU’s defence industry faces challenges in competitiveness and funding, with a need for an industrial output plan.
- The EU needs approximately €500 billion over the next decade to remain competitive in global defence.
- The EU is also focusing on leveraging space technology for defence purposes, with plans to establish a European space domain awareness system.
The European Union is preparing for a worst-case military scenario—a Russian attack on one of its 27 member states. EU Commissioner for Defence and Space Andrius Kubilius is set to present a White Paper on European Defence by 19 March, outlining measures to prepare the EU for both immediate military contingencies and long-term security challenges on the global stage. However, despite an uptick of rhetoric and action, the bloc remains far from achieving what Kubilius has described as a big bang approach to defence.
Business as usual in defence is simply not possible anymore, Daniel Fiott, a professor at the Centre for Security, Diplomacy and Strategy (VUB) in Brussels, told Euronews. Fiott stressed that the white paper must clearly define how Europe should respond if the US drastically reduces its support for Ukraine and European security, along with the funding needed across key defence capability areas.
Competitiveness is a critical challenge for the European defence industry, MEP Riho Terras (Estonia/EPP), vice-chairman of the Parliament’s security and defence committee, told Euronews. It is too fragmented, internal market rules do not apply to the defence industry, and the banking sector does not lend money to defence industries, he argued, emphasizing that the Commission must address these shortcomings within its mandate.
Funding and Investment in Defence
To tackle this, industry leaders are calling for an industrial output plan that translates member states’ capability needs into concrete defence industry targets, specifying quantities and timelines. Industry representatives urge governments to indicate which capabilities require scaling, by how much, and by when, both in peacetime and wartime.
Mario Draghi’s competitiveness report estimates the EU will need approximately €500 billion over the next decade to remain competitive in global defence—yet member states’ constrained defence budgets remain the primary funding source. So, where will the money come from?
2% of GDP is history. We need to establish a new threshold—3% GDP minimum—and the EU should declare it too, Terras said, referring to NATO’s 2% defence spending target, which 23 of the 27 EU member states adhere to.
Space Technology and Defence
Commissioner Andrius Kubilius has proposed allocating at least €100 billion for defence investment in the next Multiannual Financial Framework (MFF), spanning 2028-2034. From 2021-2027, only €15 billion (1.2% of the MFF) was dedicated to security and defence.
The space and defence industries face similar challenges, so solutions should be developed jointly, Kubilius told the 17th Space Conference in Brussels. We must use space to defend our countries, societies, and people—with intelligence, geolocation, and communication for our armed forces, the Space and Defence Commissioner told the audience.
I want to establish a dialogue with Member States and space commands to explore options for a European space domain awareness system to monitor threats, including military threats, the Lithuanian Commissioner said. Battlefield experience in Ukraine has demonstrated that intelligence from space is crucial for modern military defence. Consequently, the EU is strengthening its intelligence structures and capabilities.