EU excludes US, Britain and Turkey from €150 billion rearmament fund - FT
Kyiv • UNN
US, British and Turkish arms companies may be excluded from the EU's defence fund if their countries do not sign agreements with Brussels. At least 65% of the funds will go to production in the EU, Norway and Ukraine.
Arms companies from the USA, Great Britain and Turkey will be excluded from the new EU defense funding of EUR 150 billion if their countries do not sign defense and security agreements with Brussels, the Financial Times reports, UNN writes.
Details
The planned fund for arms spending will only be open to EU defense companies and those from third countries that have signed defense agreements with the bloc, officials said on Wednesday.
This will also exclude any advanced weapons systems for which a third country has a "right to design" - a restriction on their design or the use of individual components - or control over their possible use, officials added.
This would exclude the US Patriot air and missile defense platform, manufactured by defense contractor RTX, and other US weapons systems where Washington has restrictions on where they can be used.
This policy is a victory for France and other countries that have demanded a "Buy European" approach to defense investment on the continent amid concerns about the long-term reliability of the US as a defense partner and supplier, sparked by US President Donald Trump, the newspaper writes.
At least 65 percent of the cost of production must be spent in the EU, Norway and Ukraine.
EU member states will not be able to spend money on products "where there may be control over the use or purpose of these weapons. (...) It would be a real problem if equipment purchased by countries could not be used due to objections from a third country," one official said.
Great Britain has been lobbying hard to be included in the initiative, especially given its key role in the European "coalition of the willing" aimed at strengthening the continent's defense capabilities. British defense companies, including BAE Systems and Babcock International, are deeply integrated into the defense industry of EU countries such as Italy and Sweden.
If third countries such as the US, Great Britain and Turkey wanted to participate in the initiative, they would need to sign a partnership with the EU in the field of defense and security, officials said.
Negotiations between London and Brussels on such a pact have begun, but they have been drawn into demands for a larger agreement between the EU and Great Britain, which would also include contentious issues such as fishing rights and migration, the newspaper writes.
The exclusion of Great Britain and Turkey, as indicated, will create serious headaches for large European defense companies that have close ties with manufacturers or suppliers in these markets.
Responding to a question about the UK's position on the rules of the new EU fund on Tuesday, a British official said: "We are ready to work together on European defense in the interests of wider European security to prevent fragmentation of European defense markets and create legal frameworks that will allow member states to cooperate with third countries".
This move will cause significant concern in the UK defense sector. One senior British defense industry insider said it was a "significant concern", adding: "We see a huge number of opportunities and it is right that the United Kingdom is seen as part of Europe".
Previous attempts by France to limit defense spending for EU companies have met with strong resistance from countries such as Germany, Italy, Sweden and the Netherlands, which have close ties with defense manufacturers outside the EU.
The proposal must be approved by a majority of EU countries.
According to the terms of the plan, EU countries will be able to spend loans on products using components from Norway, South Korea, Japan, Albania, Moldova, North Macedonia and Ukraine, officials said.
