EU states tell bloc’s bank to lend more for defense

The EU’s 27 nations on Thursday urged the European Investment Bank, the EU’s financing body, to ramp up lending to defense firms in the face of a mounting threat from Russia.

The European Union has been clambering to produce more weapons in a bid to continue the flow of arms and ammunition to Kyiv and keep Europe’s stocks in good health.

“The European Investment Bank is invited to adapt its policy for lending to the defense industry and its current definition of dual-use goods,” the leaders said in conclusions after a summit in Brussels.

The EIB is the world’s biggest multilateral public lender and has plowed in billions of euros to help Ukraine after Russia’s 2022 invasion.

But according to long-established policies, the Luxembourg-based bank should not directly fund the production of arms and ammunition, and the dual-use goods it finances must have a primarily civilian purpose.

The states’ call comes after more than half of the bloc’s members urged the EIB to bolster financing for Europe’s defense industry as war rages on the continent.

In a letter signed by 14 countries including the EU’s powerhouses, Germany and France, they said Sunday the lender should expand its investments in defense beyond a small number of “dual-use products” that can have both military and civilian functions.

Since its establishment in 1958, the EIB has invested more than a trillion euros in projects covering a range of sectors including the environment and social cohesion.

The EIB also plays a strong role in international development. Its EIB Global branch is active in 160 countries and has poured 10.8 billion euros in loans in 2023.