From the military base in Lithuania to the purchase of helicopters for the Italian army, the EIB invests in defence

After deciding to increase Nato defence spending from 2 to 5 per cent of GDP by 2025, Europe is looking for the resources to finance the new expenditure. And also in the game is the European Investment Bank, the EU's long-term financial institution owned by the member states which, according to the White Paper approved by the European Commission in March, is obliged to support the rearmament effort of European countries. The EIB has recently broadened its eligibility criteria to support projects in the military sector, in line with EU objectives. Last week, the Board of Governors of the European Investment Bank approved an increase to the funding ceiling in 2025 to a record 100 billion, up from the 95 billion estimated at the beginning of the year, mainly to increase investment in security and defence.

Among the projects that have benefited from EIB support are the launch of satellites in Poland and the modernisation of some ports in Denmark to allow access for Nato warships. In addition, the financial institution has invested money in some specialised venture capital funds.

The EIB has signed a new agreement with the Italian Ministry of Economy and Finance and the Italian Ministry of Defence for a EUR 107.5m loan to strengthen Italy's security and defence capabilities. The funds will be used in particular for the purchase of helicopters for the army. This was announced in a note. The operation is part of the EIB's enhanced commitment to European security. The bank has expanded its eligibility criteria in recent months to include projects in the military field, in line with the EU's strategic priorities. The loan will be disbursed in detail to the MEF, which will transfer the resources to the Ministry of Defence. This is the third agreement of this kind between the EIB, the MEF and the Ministry of Defence: in 2022, EUR 240 million was earmarked for 16 light helicopters for the Carabinieri and for the modernisation of air traffic control. In 2020, instead, EUR 220 million was earmarked for the construction of three hydro-oceanographic ships.

The European Investment Bank recently announced that it will provide EUR 540 million to finance the new military base in Lithuania at Rūdninkai, which will house a German Bundeswehr brigade, also deployed to strengthen Nato operations. This will be the first time that the EIB is financing a military base, as well as the first major investment in military infrastructure since the recent revision of the EU institution's mandate. The obstruction of the military site south of Vilnius and 35 kilometres from the Belarusian border is scheduled to begin in 2026 and will house some 4,000 German soldiers and 750 civilians.