Brussels is changing its spending policy to redirect tens of billions of euros to defense and security in response to Russia’s war in Ukraine and Donald Trump’s return to the White House.
The changes could affect around €392B allocated to so-called cohesion funds until 2027. While these funds cannot be spent directly on military equipment, the new initiative will allow member states to invest in so-called “dual-use technologies,” such as drones, and infrastructure upgrades, including roads and bridges, that will improve troop mobility.
This issue is especially relevant for Germany, which is Europe’s key transit center but needs significant infrastructure renewal. According to German Ministry of Economy estimates, about €165B is required. This country should, receive €39B in cohesion funds by 2027.
The biggest beneficiaries of cohesion funds, such as Poland, Italy, and Spain, have used only around 5% of the allocated funds so far.