Attempts to move towards common defence have been part of the United Europe project since its inception following the Second World War. It is doubtful whether the recently launched European Defence Fund will pave the way for a happy ending.
It was in September 2016 that the European Commission pushed the button to finally materialise the long-expected European Defence Fund. The initiative, whose objective is to help member states spend taxpayer money more efficiently and reduce duplications in spending, has also received the blessings of the European Council and NATO. The Fund will coordinate, supplement and amplify national investments in defence research, in the development of prototypes and in the acquisition of defence equipment and technology. Defined as a complementary element in NATO-EU cooperation, it is underscored that the Fund signifies a cornerstone in terms of EU’s “strategic autonomy” and the competitiveness of Europe’s defence industry.
Intended to be a game-changer also for many SMEs and mid-cap companies forming the European defence supply chain, the European Defence Fund has two strands; Research, Development & Acquisition. In the case of Research; the EU will for the first time offer grants for collaborative research in innovative defence technologies and products, fully and directly funded from the EU budget. Projects will be financed with €90 million until the end of 2019, with €25 million allocated for 2017 and €500 million per year after 2020. With respect to Development & Acquisition, the Fund will create incentives for Member States to cooperate on joint development and the acquisition of defence equipment and technology through co-financing from the EU budget. The EU will offer co-financing with €500 million in total for 2019 and 2020, and €1 billion per year after 2020.
