The New Commission Needs a Strategy to Trump-Proof European Security

The European security outlook is changing rapidly, and the new European Commission needs to step up its preparations for the years to come or risk leaving Europe unprotected.

Under Russian pressure, NATO is in the process of rearming and expanding, having welcomed Finland and Sweden into the alliance, increasing national defence budgets towards 2% of GDP (Cottarelli and Virgadamo, 2024) and offering Ukraine a path towards membership. However, NATO remains a US-centric alliance, and the commitment of the US Government to support the EU in case of a Russian attack may be questioned by Donald Trump, should he win back the Presidency and renege on supporting Ukraine and Europe.

Against this dangerous context of war and uncertainty, the European Union must be endowed with the instruments to fulfill its treaty obligations, which include mutual defence in front of military aggression (art 42.7). Even though art.42.7 does not cover candidate members like Ukraine, Russian government officials have repeatedly and aggressively stated that Ukraine is only the first step in a larger process of rebuilding the lost Soviet empire, which includes many countries currently part of the EU.

It is therefore a paramount European security interest to ensure that Ukraine survives and wins the war.

A Trump-Proof EU

In the coming months, as the new European Commission begins its job, it must therefore set up a credible strategy to secure the European continent and Trump-proof European defence.

Funding European defence. The most immediate priority pertains to funding. To ensure that the EU can continue to support Ukraine and can defend itself even in case of a Trump victory in November, the EU will need additional funding for defence (see Beetsma et al 2024).

This cannot come through ordinary financial mechanisms since the EU will not change its current budget until 2028 when the next Multiannual Financial Framework will enter into force. As Palacio et al. (2022) suggested days after the beginning of the invasion, and later by national leaders like French President Emmanuel Macron and then-Estonian Prime Minister Kaja Kallas, in the short-term the EU needs an off-budget instrument inspired by the successful experience of the Resilience and Recovery Facility.

This temporary security facility should bridge the financial gap in defence needs between 2025 and 2028 when the new Multiannual Financial Framework (MFF) will enter into force. The goals of this special purpose fund should be threefold: (1) ensure that industries and plants producing weapons for Ukraine continue to have restocking orders, (2) allow European countries to improve their existing militaries, and (3) provide a joint financial reserve that can be activated to support the expansion and operations of the European Rapid Deployment Capacity, an embryonic form of European military force set to begin its operation in 2025.

This fund can be financed in multiple ways. Since a good share of the expenses would qualify under NATO 2% objective, national contributions (or loans-based Eurobonds to be repaid by Member States, like in the case of SURE) could cover part of the expenses, while genuine Eurobonds could temporarily cover the rest, mirroring the RRF financial structure.

The funding tranche dedicated to supporting factories for military production for Ukraine could come from some of the earnings of the currently frozen Russian assets, which the EU leaders have already agreed to use to support Ukraine.

Integrating Defence Industries. A long-term shortcoming of the European defence industry is that is the result of many national industrial complexes which evolved separately and maintain very strong political links with the national capitals, often resulting in political clashes over the purchase of military kits.

Countries with strong and established military industries like France, Italy, and Germany tend to have a much more protectionist view of this market, while countries on the eastern border, who feel more at direct risk, typically prefer American weapons, both because the current kit is often seen as superior, and because military contracts with American counterparts carry implicit additional security guarantees.

As suggested by Nicoli and Beetsma (2024) addressing the market fragmentation challenge cannot be done easily and requires a long-term strategy. In the short term, the EU should make wider use of competitive joint procurement of weapons to help establish a logic of market competition.

In the medium to long term, once the new MFF is approved, the EU should increase its R&D and its financing of truly cross-national European projects through the European Defence Agency to ensure (1) that future European weapons programmes find an industrial base that is properly cross-national, and (2) that the military hardware resulting from these programmes is competitive with their American counterparts.

Rethinking Decision-Making Mechanisms. Finally, the EU should start the groundwork to change its outdated, veto-based decisional system in military and foreign policy.

As abundantly shown by the continuous vetoes put forward by Hungary’s Viktor Orbàn, a foreign policy by consensus is no longer effective when the EU has grown to 27 diverse countries; European citizens have well understood that, and display very high levels of support to move beyond such vetoes (Nicoli et al. 2023).In the short term, the Commission should propose the activation of the Passerelle Clause for foreign and security policy, which does not require Treaty revision.

However, to move towards majority voting in defence, the process of Treaty revision will need to be started sooner or later. If national vetoes persist and block any such progress, the EU countries willing to go forward should take a page from the Eurocrisis playbook and sign a separate Treaty, like the treaty establishing the European Stability Mechanism or the Treaty on Stability, Coordination and Governance (both introduced during the Eurocrisis to bypass the British veto), inclusive of a majority voting system, to be integrated into the EU treaties at a later stage once the political situation allows for it.

If Trump is elected in November 2024, the security outlook of Europe could deteriorate very fast as Russia may attempt to seek the opportunity of taking NATO off balance. It is therefore essential that the Commission and the forthcoming Defence Commissioner begin the policy planning and design well in advance and preferably as soon as they take office, as to move past preliminary negotiations and have blueprints ready for approval should the situation require it.

Sources

Beetsma, R. Buti, M. and F. Nicoli (2024- forthcoming) Defence as a European Public Good: Delivery and Financing. CESIFO EconPol Forum, July 2024.

Cottarelli, C. and L. Virgadamo (2024) Defense expenditure in EU countries. IEP@BU paper, forthcoming.

Palacio, A., Merler, S., Nicoli, F. and S. Tagliapietra (2022) How Europe can sustain Russian sanctions. Project Syndicate, Feb. 28, 2022.

Nicoli, F. and R. Beetsma (2024- forthcoming) Joint public procurement as a tool for European industrial policy at times of crisis. Bruegel Policy Brief, forthcoming 2024.

Nicoli, F., Burgoon, B. and D. Van der Duin (2023) What would Europeans want a European defence union to look like?. Bruegel Working Paper 09/2023

IEP@BU does not express opinions of its own. The opinions expressed in this publication are those of the authors. Any errors or omissions are the responsibility of the authors.

If you want to stay up-to-date with the initiative of the Institute for European Policymaking@Bocconi University, subscribe to our monthly NEWSLETTER here.