Amid the tensions between US' Trump administration and its European counterparts, the European Commission has announced a joint borrowing plan to strengthen the EU's defence capabilities under the 'ReArm Euope' plan.
After the coming of Donald Trump, the European Union has realised that it can no longer blindly rely on the United States. Keeping this in mind, European Commission President Ursula von der Leyen stated that the European Union has proposed an 800 billion euro plan to boost the bloc's defence capabilities.
As per President Ursula von der Leyen, this joint borrowing plan will focus on strengthening Europe's military capabilities amid rising security threats. This announcement from the commission also comes after US President Donald Trump halted military aid to Ukraine.
For the 'ReArm Europe' Plan, the European Commission has proposed a joint borrowing of 150 billion euros ($157.76 billion) to lend to EU governments for defence as part of an overall 800 billion financing effort to boost Europe's defence capabilities.
As per the European Commission President, the joint borrowing plan would go towards building pan-European capability domains like air and missile defence, ammunition, drones and anti-drone systems, artillery systems, cyber systems and more.
Revealing the plan, Ursula von der Leyen said "it will help Member States to pool demand and to buy together. This will reduce costs, reduce fragmentation increase interoperability and strengthen our defence industrial base."
While a timeframe of this plan was not shared, the president stated that urgency surrounding the plan and the need for Europe to mobilise together.
The proposal will be further discussed at the special summit in Brussels later this week on Thursday.
As per von der Leyen, the funds will also come after member states increase their defence spending by 1.5 percent of the GDP. With this, a fiscal space close to 650 billion euros can be created. This plan also aims to expand defence spending without triggering the excessive deficit procedure.
The UK has already announced it will increase its defence spending to 2.5 percent of the GDP, aiming for a whole three percent by 2027.
Furthermore, the cohesion funds, which are commissioned to equalise the standards of living across the bloc, can be redirected for defence purposes.
"Europe is ready to assume its responsibilities. Europe could mobilize close to 800 billion euros for a safe and resilient Europe. We will continue working closely with our partners in NATO. This is a moment for Europe. And we are ready to step up," von der Leyen added further.
The coming of the Trump administration in the United States has been a key factor in the European Union's working to strengthen itself.
Starting from Vance's controversial speech at the Munich Security Conference to Trump pausing military aid for Ukraine and cosying up to Putin, European countries are now "stepping up" as Washington is no longer a stable ally for the bloc.
Following Trump's public spat with Ukrainian President Zelenskyy, other NATO and EU allies have rallied around Ukraine and the 'ReArm Europe' plan also aims to increase aid for Kyiv.