Remarks by Commissioner Dombrovskis at the second ECOFIN press conference in Warsaw

Thank you, Andrzej. Good afternoon, everyone.

In this current geopolitical situation, Europe is committed to taking more responsibility for its security by mobilising substantial investments in defence capabilities and defence industry.

It is especially appropriate that we held this discussion here in Warsaw, given that Poland is leading the way in investing to enhance defence and security capabilities.

EU Member States bordering Russia, or its satellite state Belarus, understand the threat that the European Union faces better than anyone else.

They have also experienced hybrid-warfare, such as the instrumentalisation of migration, and have been the target of Russian disinformation campaigns and also faced a number of sabotage acts.

It was therefore reassuring to see that there was a very broad agreement amongst ministers today that Europe must take more responsibility for its defence.

Of course, rebuilding Europe's defensive capabilities requires urgent and significant investment.

That was the focus of today's meeting.

Last month, the Commission presented the ReArm Europe Plan and the Readiness 2030 initiative to facilitate and encourage such investment.

As you know, it aims to boost defence funding to unlock up to €800 billion.

This can be a game-changer for Europe's defence capabilities.

Today provided an important opportunity to present ministers with this package and engage with ministers on its contents.

Allow me to briefly present the three main elements that we discussed in today's meeting.

Firstly, we have proposed the coordinated activation of the national escape clause of the Stability and Growth Pact.

This will facilitate a rapid increase in defence spending by allowing Member States to temporarily deviate from the normal fiscal requirements.

I underlined that it will be crucial that Member States, at the same time, safeguard fiscal sustainability.

To this end, the deviation is limited in terms of scope, duration and volume.

From today's discussion, we can see that most Member States, a large majority of Member States, are considering triggering the clause. 

From the Commission side, we want to this in a coordinated and synchronised manner.

We have invited Member States to come forward with their requests to activate the national escape clause by the end of April.

It is not a deadline, but just to ensure coordination.

The Commission stands ready to swiftly assess the requests received and adopt recommendations in June, for adoption by the Council in July.

The second main element we presented was the new €150 billion loan instrument Security Action for Europe, or “SAFE”.

This will provide loans to Member States to invest in key defence areas like ammunition, missiles, drones, and cyber security.

The funds will be raised on capital markets and disbursed to interested Member States upon demand, based on their national plans.

So, SAFE will encourage Member States to spend better, together and European by providing loans on very good terms.

The third and final element we presented concerns better channelling private financing towards the defence sector, also with the help of the European Investment Bank Group and the Savings and Investments Union.

A short word on the economic impact of these measures.

Beyond enhancing Europe's security, we expect additional defence spending to also boost competitiveness and economic growth, drive innovation and create new jobs.

The precise impact will eventually depend on the spending trajectory of Member States over time and its composition.

It can also act to enhance the capabilities and capacities of Europe's defence industries.

As you know, the EU is working intensively to diversify our trade with new and existing partners across the world.

We expect also to find new markets for a resurgent European defence industry, as our allies and strategic partners across the world seek reliable suppliers.

To conclude, the Commission looks forward to continuing to engage closely with Member States in the weeks ahead on the next steps in rebuilding Europe's defence capabilities.

Together, we can and will take responsibility for defending our freedoms and values.

Before I finish, I would like to once again thank the Polish Presidency for their hospitality and for the excellent organisation of the meeting.

Thank you very much.