Ministerial Committee on European Union Affairs discusses financing to reinforce European defence

Ministerial Committee on European Union Affairs discusses financing to reinforce European defence

In its meeting on Wednesday 16 April, the Ministerial Committee on European Union Affairs discussed the proposal for a financial instrument to strengthen European defence and the proposal on taking Member States' defence expenditure into account within the Stability and Growth Pact. The initiatives are part of the ReArm Europe Plan. The European Commission's Omnibus I package, which aims to reduce the administrative burden on businesses, was also on the agenda.

The Ministerial Committee on EU Affairs outlined Finland's position on the Commission's proposal for a SAFE Regulation to boost European defence investments, which would rapidly strengthen the European defence industry and enhance European defence. In the exceptional current situation, the instrument would allow Member States to apply for up to EUR 150 billion in loans to develop defence capabilities in jointly agreed priority areas. The instrument aims to promote common procurement by groups of Member States. The Commission would finance the SAFE instrument by borrowing he necessary funds on behalf of the Union. The instrument would be secured using the existing room for manoeuvre between the EU's own resources ceiling and the expenditure ceiling under the multiannual financial framework. Finland's position on the Commission's proposal will be made public after the government session.

The Ministerial Committee on EU Affairs also outlined Finland's position on the Commission's proposal to give the EU Member States more fiscal flexibility for investments in defence. The proposal would allow Member States to apply for temporary flexibility within the EU fiscal policy framework, provided that this does not endanger the country's fiscal sustainability over the long term. Given the changes in the European security situation, Finland considers the flexibility proposed by the Commission appropriate.

The Ministerial Committee on EU Affairs also discussed the Commission's proposals to reduce the administrative burden on businesses. The Omnibus I proposals aim to make sustainability reporting more efficient and easier to approach, to simplify the obligations of the Corporate Sustainability Due Diligence Directive to support responsible business practices, and to strengthen the Carbon Border Adjustment Mechanism to make trade more equitable. Finland's position on the Commission's proposal will be made public after the government session.

Inquiries: Juuso Kilpinen, Special Adviser for EU Affairs, tel. +358 50 322 9636, Jari Luoto, Director General, EU Affairs Department, tel. +358 50 468 5949, and Anne Sjöholm, Head of Communications for EU Affairs, tel. +358 40 537 0733, Prime Minister's Office