While global defence spending was already growing, focused on the modernisation of defence capabilities and NATO’s spending target of 2% of GDP, a large-scale conflict on EU borders was a wake-up call for NATO and its European members. Today, the war still rages on, and after a contentious meeting at the White House with Ukraine President Zelenksy, the U.S. paused all military aid and intelligence to Ukraine, with far-reaching repercussions. A new European era of defence was ushered in, with a resolve to be less reliant on the US as an ally with a commitment to European rearmament and autonomy. The EU Commission has devised a “ReArm Europe/Readiness 2030” plan the tenants of which were published in a White Paper for European Defence and the ReArm Europe Plan-Readiness 2030 on 19 March 2025, outlining its 5-year plan.

The EU white paper offers solutions to strengthen the defence industry by closing capability gaps and ensuring long-term readiness. It also suggests ways for Member States to invest heavily in defence, buy necessary equipment, and support the industry’s growth over time. The plan calls for €800 billion of investment for a massive ramp-up of defence spending.  It will also include a €150 billion credit facility, the Security Action for Europe (SAFE) plan, that will help fund this investment. By activating the national escape clause of the Stability and Growth Pact, EU members will be able to increase defence spending an additional 1.5% of their GDP, equating to 650 billion euros over the next 4 years.