(Bloomberg) -- The EU’s first-ever defense chief, Andrius Kubilius, said it’s worth exploring the option of issuing joint bonds in order to raise the additional €500 billion ($556 billion) needed to bring the European Union’s industry up to speed.
Kubilius, who was addressing reporters in Strasbourg on Tuesday after officially being nominated for the European Commission post, suggested other options, such as tapping the bloc’s bailout fund or using unspent money from the EU’s pandemic-era Recovery and Resilience Facility.
“I would like to see much bigger numbers,” he said, referring to the bloc’s current military spending. He added that the EU can’t wait until the next seven-year budget comes into force in 2028.
Kubilius, who is a former prime minister of Lithuania, also mentioned discussions with the European Investment Bank about ramping up investment in Europe’s defense industry.
“We are not going to compete with NATO or member states on defense or deterrence plans,” he said, stressing that the EU’s role would be to support the industry and make sure member states buy “much more than 20%” domestically, which is currently the case.
While defense remains a national prerogative of member states, there has been a push since Russia invaded Ukraine in 2022 to bolster Europe’s military capacity by reviving a fragmented industrial military base.
Commission President Ursula von der Leyen decided to create the new role after Russia’s invasion of Ukraine helped exposed weaknesses in the bloc’s defense industry. But countries like Germany have made it clear they remain opposed to the idea of more joint debt despite the call to reconsider it by former European Central Bank chief Mario Draghi in his recent report on competitiveness.
Kubilius will work closely with the EU’s new top diplomat, former Estonian Prime Minister Kaja Kallas. Kallas and Kubilius symbolize the EU’s shift east in terms of foreign policy. Both have been among Europe’s staunchest defenders of Ukraine.
--With assistance from Lyubov Pronina.
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