EU approves allocation of huge regional funding of 392 billion euros for military projects
Kyiv • UNN
EU ambassadors have agreed to use the €392 billion cohesion fund for defense-related projects, which accounts for approximately one-third of the EU's 2021–2027 budget. This decision allows EU countries to use regional funds to support the defense industry and modernize infrastructure.
EU countries receive "green light" to use the current regional EU fund for defense-related projects, with security and civil defense named as key priorities for this large-scale funding. This is reported by Euractiv, writes UNN.
Details
As the publication notes on Wednesday, July 23, EU ambassadors agreed on the wording for the €392 billion cohesion policy — a fund that accounts for approximately one-third of the EU budget for 2021–2027 and is intended to help poorer regions overcome economic backwardness.
As part of the current interim review of this fund, EU leaders decided to prioritize defense capabilities. This shift has already drawn some criticism due to the potential reduction in funding for social and economic programs in favor of military spending.
Late last week, Council and European Parliament negotiators reached a compromise on the final wording.
Given [...] the Union's need to guarantee its own defense and civil readiness, funding from the cohesion policy should be promptly mobilized to directly support investments in defense capabilities and public security
Other EU priorities are also mentioned, such as economic competitiveness and the transition to renewable energy sources.
The review opens up the possibility for EU countries to use regional funds to support the defense industry, as well as to modernize infrastructure in accordance with military requirements.
To remain within the fund's original purpose, such investments "must primarily contribute to projects that stimulate employment, skill development, and industrial diversification at the regional level," according to the document. Projects must also support small and medium-sized enterprises and dual-use technologies.
Several EU countries advocated for an even broader expansion of the scope of cohesion funds in specific sectors. However, the limits of the text seem broad enough to satisfy most.
Addition
The European Commission's initial proposal was criticized by experts and representatives of local regions for redirecting funds to the defense sector and large corporations. The President of the EU Committee of the Regions, Kata Tjüttö, expressed concern that such a change would turn cohesion policy into "just an emergency fund used to patch up the consequences of changing priorities."
The final approval of the new priorities for cohesion funding now seems very likely, given the key approval of EU ambassadors and successful negotiations between the Council and Parliament. EU ministers still have to approve the agreement at a future official meeting, and MEPs have to approve it at the next plenary session