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Updated: EU formally adopts $170 billion defense plan amid Russia's war against Ukraine

by Volodymyr Ivanyshyn and Martin Fornusek May 27, 2025 4:28 AM  (Updated: ) 2 min read
EU flags in front of the European Commission building in Brussels, Belgium, on Dec. 28, 2023. (Dursun Aydemir/Anadolu via Getty Images)
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Editor's note: The article was updated after the EU formally adopted the plan.

The EU formally adopted a 150-billion-euro ($170 billion) defense loan instrument amid Russia's war against Ukraine, the Council of the EU announced on May 27.

The EU reached an agreement to launch the $170 billion common defense fund on May 21 as Europe faces an increasingly challenging security environment. Russia continues to wage its war against Ukraine, and Europe is growing uncertain of U.S. security commitments to the continent.

The Security Action For Europe (SAFE) initiative will offer $170 billion in loans without counting towards EU fiscal spending limits.

SAFE is an EU loan instrument meant to prop up the continent's defense industry by financing weapons procurement to eligible countries. It also aims to "boost production capacity, making sure defense equipment is available when needed, and to address existing capability gaps," the Council of the EU said in a statement.

"This is an unprecedented instrument which will boost our defense capabilities and support our defense industry. The more we invest in our security and defense, the better we deter those who wish us harm," said Adam Szlapka, Poland's European affairs minister.

The EU's member states, European Free Trade Association (EFTA) members, and Ukraine are eligible to borrow funds from the defense spending instrument.

The EU "would effectively double the volume of weapons Ukraine receives" by investing in domestic weapons production through the SAFE mechanism, EU Defense Commissioner Andrius Kubilius said on May 4.

"If (Russian President Vladimir) Putin isn’t convinced by (U.S. President Donald) Trump to make peace, we could bring forward more convincing arguments for peace very quickly — by greatly increasing our military support to Ukraine," Kubilius said.

The commissioner called for EU members to utilize the bloc's SAFE initiative to strengthen Ukraine in its fight against Russia's war.

The fund is part of the European Commission's ambitious ReArm Europe program, which allows member states to spend an additional 650 billion euros ($730 billion) on defense by loosening fiscal rules.

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