| 29 February 2024, Thursday |

EU members’ defence spending should buy more time for debt cuts -von der Leyen

According to EU budgetary laws, a nation funding cross-border EU defense projects should be granted extra time to reduce its public debt, the chairman of the European Commission stated on Thursday.

A reform like this would go beyond what has been agreed upon by governments so far, who seek to give defense expenditure the status of a “relevant factor” when the Commission determines whether a budget deficit is within EU limitations. The fiscal rules are currently being revised.

Commission President Ursula von der Leyen said at an annual conference of the European Defence Agency that if such a rule were introduced to the EU’s debt and fiscal laws, could be a major change for the 27-nation EU’s defence and industrial policy.

The EU’s fiscal rules, which limit government borrowing, are being debated by finance ministers in the EU Council. Once they reach a deal, they will need to win approval of the European Parliament.

“In the Council, there is now broad support to consider increases in defence spending as a relevant factor when assessing whether a Member State has an excessive deficit,” von der Leyen said.

  • Reuters