EU boosts defence readiness with first ever financial support for common defence procurement
The Commission has approved funding for five cross-border projects to support more coordinated and efficient defence procurement among EU Member States. Implemented under the European Defence Industry Reinforcement through Common Procurement instrument (EDIRPA), each of the 5 selected projects will receive €60 million, representing a total amount of €300 million funding.
Bringing greater value for money through economies of scale, the common procurement will make critical defence capabilities more affordable for Member States' armed forces. With products procured in common, Member States' armed forces will have improved interoperability. The clearer perspectives and greater predictability, which come with larger contracts, will strengthen the European industry, and allow it to adapt its production capacity to Europe's defence needs. All in all, the common procurement will reinforce defence readiness in the EU Member States.
Leveraging procurement of more than €11 billion worth of defence products for the armed forces of the Member States
Marking a new era in European defence cooperation, the Commission has announced the first-ever EU-funded projects supporting common procurement of critical defence products by the Member States, in three areas:
• Procurement of air and missile defence systems
Two projects will bolster joint air and missile defence capabilities. The ‘MISTRAL' project supports the common procurement of ‘Mistral' very short-range air defence systems by nine Member States (FR, BE, CY, EE, ES, HU, SI, RO, DK). Another project, ‘JAMIE' (for ‘Joint Air Missile Defence Initiative in Europe), will result in the common procurement of IRIS-T SLM medium-range air defence systems by six Member States (DE, SI, BG, AT, EE, LV). These are systems for protection against air threats such as combat aircraft, attack helicopters and unmanned air systems.
• Procurement of modern armoured vehicles
EDIRPA will also support the procurement of the Common Armoured Vehicle System (CAVS), a modern armoured carrier for protected troop transport, by four Member States (FI, LV, SE, DE). The modern armoured vehicles offer high performance and unprecedented mobility.
• Procurement of ammunition
In two further projects, EDIRPA will support the common procurement of different types of 155mm artillery ammunition, namely the project ‘CPoA 155mm' involving six Member States (NL, IT, PL, LT, DK, HR) and the project ‘HE 155mm' involving four Member States (DE, DK, NL, EE).
The five selected projects represent a combined procurement value exceeding €11 billion, illustrating the high leverage of EU funding. EDIRPA's €300 million investment has incentivized a commitment over 36 times larger, demonstrating the programme's effectiveness in driving substantial defence investments across the EU.
The five selected EDIRPA projects, for all three areas, will now enter the grant agreement preparation phase, involving detailed coordination between the Commission and the consortia of Member States' public authorities.
In addition to the selected projects, other promising proposals were submitted. They have been added to a reserve list making them identifiable for potential future funding. For instance, the Member States involved in these proposals could seek to financially support them by transferring unused EU funds allocated to them under shared management.
Impressive number of EU Member States participating
The selected EDIRPA projects involve 20 Member States, some of which will engage in common defence procurements projects for the first time. This reflects EDIRPA's role in encouraging collaboration among Member States to address critical capability gaps, in particular those exacerbated by the transfer of defence products to Ukraine. On average, six Member States are participating in each project —double the minimum legal requirement of three Member States— showing the interest towards a more unified European approach to defence procurement.
Supporting Ukraine
Most selected projects also include procurement of defence products intended for Ukraine, including air and missile defence systems and ammunition, bolstering the country's defence capabilities in the context of the ongoing Russian aggression.
Background
The selection of EDIRPA projects comes in response to calls for proposals launched by the Commission in March 2024. With the adoption of EDIRPA, and its subsequent implementation through the Work Programme, and the launch of the respective calls for proposals, the Union is incentivising for the first time Member States and Norway to acquire defence products in common, serving the most urgent and critical needs, especially those amplified by Russia's aggression against Ukraine. Aggregating demand provides predictability and therefore incentivises industry to ramp up manufacturing capacity and will improve the interoperability of the national armed forces.
The EDIRPA Work Programme supports common procurement in three areas: 1) Ammunition, 2) Air and missile defence, and 3) Platforms and replacement of legacy systems. These funding priorities have been set together with the Member States to address urgent defence needs and replenish defence stockpiles.
By the submission deadline of 25 July 2024, the Commission received a total of 12 proposals, showing the significant interest from Member States and Norway. The Commission services checked the admissibility and eligibility of the received proposals and evaluated them in line with the provisions of the EDIRPA Regulation.
The EDIRPA programme is a short-term instrument adopted following Russia's aggression against Ukraine and made to last until 2025 with the aim to incentivise cooperation for the most urgent defence products. The programme supports the procurement of defence capabilities by the armed forces of the Member States and Norway. The EDIRPA budget is not paying for defence products but is compensating Member States for the additional administrative costs of procuring in common. In March 2024, the Commission presented the proposal on a European Defence Industry Programme (EDIP) to extend the EDIRPA logic beyond 2025, to continue to aggregate European demand and increase interoperability.
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Quote(s)
This is the first time we use EU budget to support Member States in commonly procuring defence products. This operation has been a success: we are investing €300 million into 5 projects addressing critical and urgent defence capability gaps. This will allow to provide better value for money for national defence budgets, improve the interoperability of European armed forces, strengthen our industry and make Europe better prepared to face defence threats. Importantly, the selected projects will also increase our support to Ukraine, with additional defence equipment.
Margrethe Vestager, Executive Vice-President for a Europe Fit for the Digital Age