(MENAFN) As part of an increasing drive for Europe to enhance its own defense capabilities, the European Union member states have reached a consensus on a substantial EURO150 billion (USD170 billion) loan initiative.

This financial package is designed to enhance defense budgets until 2030 by encouraging collective projects, updated acquisitions, and replenishing military reserves.

European Council President Antonio Costa shared the news of the agreement on X, describing it as "an important step towards a stronger Europe."

He emphasized that the plan fulfills the pledges made by EU leaders in March, facilitating joint investments among EU nations in European defense and reinforcing collective protection.

In a post on X, Poland — currently holding the EU’s rotating presidency — supported the agreement, stating, "The more we invest in equipping our armies, the better we will deter those who wish us harm."

This underscores the growing concern among European nations to enhance their military readiness in response to evolving global threats.

With increasing demands from the new U.S. administration for NATO members — most of whom also belong to the EU — to ramp up military expenditures, the EU has embarked on crafting updated defense approaches.

This includes strategic planning to increase financial contributions to security efforts.

In March, the European Commission introduced a new White Paper as part of its broader initiative to expand defense financing and manufacturing capabilities through 2030.

A central element of this proposal is the Security Action for Europe (SAFE) program, which encompasses the EURO150 billion loan scheme.

Participation in SAFE is open not only to EU countries but also to states that have entered into formal cooperation arrangements with the Union concerning security and defense matters.

These agreements currently include nations such as Norway, Moldova, South Korea, Japan, Albania, and North Macedonia — all of which are non-EU countries.

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