Giorgetti: “Strengthen InvestEU to stimulate the defense industry”

Brussels – Using the European investment program to stimulate the defense industry, thereby not affecting national budgets, is the idea Italian Economy Minister Giancarlo Giorgetti proposed at the Ecofin meeting. “We are in favor of strengthening InvestEU for defense,” he said during the public working session. It is the way to revive a sector that is not only national but strategic for the governments of all member states.

The Italian idea responds to the government’s need for a prudent approach that does not produce discontent or further debt. As Giorgetti explicitly told his partners, Italy “cannot conceive of defense funding at the expense of healthcare spending and public services.” It is something that risks being highly unpopular. Conversely, “a guarantee fund of about 16 billion euros could mobilize up to 200 billion additional industrial investments.” The EU could offer these guarantees through its budget and programs, including InvestEU for investment. “We are therefore in favor of strengthening InvestEU for defense to increase its ability to attract private investors and its risk appetite,” the Finance Minister reiterated.

After the German-Dutch opposition to new Eurobonds, the idea is gathering support. In particular, France is keenly interested in Rome’s proposal. “I welcome Italy’s defense proposal, which I think can be taken into consideration because it could provide a new tool,” said French Finance Minister Eric Lombard. Greece also supports reviving defense and space technology investments through InvestEU.

The reaction from Germany was lukewarm, with Minister Jorg Kukies acknowledging the importance of the InvestEU instrument and the fact that it does not burden national budgets, but, he warns, drawing from there “will have an impact on the common budget.” On the other hand, Malta opposes Giorgetti’s idea: “The priorities of the instrument must remain unchanged,” Finance Minister Clyde Caruana stressed.