Europe Ramps Up Defence Spending, Backs Ukraine Amid US Aid Suspension

European Leaders Boost Defence Spending, Back Ukraine

European leaders, meeting in Brussels, agreed to significantly increase defence spending in a show of support for Ukraine following the US suspension of military aid.

French President Emmanuel Macron labelled Russia as "an imperialist" and warned against its "imperial ambitions." He also criticized Moscow's reaction to his description of Russia as an existential threat to Europe, stating that the Kremlin was angered by the exposure of their true intentions.

While Hungary's Prime Minister Viktor Orbán did not endorse an EU statement opposing Trump's Russia-friendly stance, the remaining 26 EU leaders firmly supported the statement, emphasizing that "there can be no negotiations on Ukraine without Ukraine."

Ukrainian President Volodymyr Zelenskyy expressed gratitude for the support, stating, "We are very thankful that we are not alone."

European Commission President Ursula von der Leyen presented an €800bn plan to increase European defence spending, calling it "a watershed moment for Europe" and for Ukraine. She emphasized the need for the EU and its member states to work together for "peace through strength."

EU leaders largely endorsed the plan, although the €800bn figure remains theoretical, contingent on decisions by member states. The final conclusions of the summit stated that "Europe must become more sovereign, more responsible for its own defence."

The commission's plan includes a €150bn loan scheme and greater flexibilities in the EU's fiscal rules that could unlock €650bn in new spending. However, member states still need to agree to the loan scheme, and it remains unclear whether governments will fully utilize the financial leeway.

The summit also saw increased pressure on all countries, especially the seven EU Nato members below the 2% target, to increase their national defence budgets.

In a significant development, Germany's probable next coalition partners have agreed to modify the country's "debt brake" to allow for increased defence spending. German Chancellor-in-waiting Friedrich Merz met with von der Leyen and Costa before the summit.

Current German Chancellor Olaf Scholz acknowledged a growing consensus on changing the German constitution to allow for greater defence spending. This unexpected move from Berlin has caused concern among Germany's frugal-minded allies.

Scholz responded cautiously to Macron's proposal for European allies to seek protection under the French nuclear umbrella, stating that Europe should not abandon US involvement. However, Merz has expressed interest in discussing with Paris and London the possibility of extending British and French nuclear protection to Germany.