Von der Leyen Pushes EU Defense Spending Above 3% as “Time of Illusions” Ends

European Commission President Ursula von der Leyen urged member states Tuesday to increase defense spending beyond 3% of GDP during a European Parliament debate in Strasbourg.

“Today we spend just short of 2% of our GDP on defense. Every analysis agrees that we need to move north of 3%,” declared von der Leyen. She reminded lawmakers how Europe reduced defense spending from an average of 3.5% to less than half after the Cold War.

The Commission President emphasized the EU budget alone cannot solve the challenge. “The EU budget only reaches 1% of GDP. The bulk of new investments must come from member states,” she stated.

Her ambitious “ReArm Europe” plan aims to mobilize €800 billion over four years for defense. Member states would contribute approximately €650 billion through increased national spending. The Commission proposes €150 billion in loans specifically for defense investments.

The plan activates the “national escape clause” of the Stability and Growth Pact. This allows countries to exceed the 3% deficit threshold without penalties when spending on defense. Member states could raise defense expenditure by 1.5% of GDP on average.

Russia’s ongoing war in Ukraine drives this dramatic shift in security policy. “Putin has proven time and again he is a hostile neighbor. He cannot be trusted, he can only be deterred,” von der Leyen remarked.

Europe Ramps Up Defense Spending

Current defense spending varies dramatically across Europe. Poland dedicates 4.12% of GDP to defense while Spain spends just 1.12%. Von der Leyen warned Russia’s military production now outpaces Europe’s.

Other European leaders support the initiative. Danish Prime Minister Mette Frederiksen emphasized, “The most important thing now is to rearm Europe, and we don’t have much time.”

Poland’s Donald Tusk called the €150 billion proposal “a massive step, but not enough.” He believes raising national defense spending to 3% will become “inevitable.”

The Commission recommends investing in air and missile defense, artillery systems, ammunition, drones, and cyber capabilities. Von der Leyen stressed contracts should prioritize European producers to strengthen the domestic defense industry.

Germany plans to suspend its national debt limit to invest heavily in defense. Chancellor Olaf Scholz supports additional budgetary flexibility for states to strengthen military capabilities.