On Monday during the meeting, the Ambassadors achieved a breakthrough in negotiations. The initial acceptance of the project proposed by Poland was the result of intensive conversations. As two EU sources confirmed, voting on the final adoption of the project is to take place on Wednesday. Then the text will go to European ministers next week. The document, after its publication in the EU official journal, could come into force at the beginning of June.
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Budget guarantees
The Safe mechanism is based on loans obtained by the European Commission and guaranteed the EU budget. The funds are to support the development of cooperation between Member States in defense orders. Key condition: projects financed from the program must be reported by at least two countries. However, during the first year of the program's operation, the possibility of submitting applications by individual states. Such a solution, as the budget commissioner pointed out, Piotr Serafin in an interview with PAP, can be particularly beneficial to Poland.
Interestingly, the Safe program will also be open to Ukraine, which can cooperate with EU countries on defense projects. This is another element of Union support in the face of Russian invasion. In addition, participation in the program is offered Norway, Switzerland and Great Britain based on defense partnership agreements.
35 percent for shopping in third countries
One of the most important items was the possibility of using loans for the purchase of products from third countries, such as the United States. Ultimately, EU countries decided that 35 percent The Safe budget can be allocated to components from outside the EU. Other 65 percent It will be reserved for producers from Europe, Ukraine as well as EFTA and EEA, including Norway and Switzerland.
The program settles the interest rate on the level of 3.3 percent. Considering this rate, countries that can get better financing conditions on their own will probably not use the program. Thus, Safe will be interested primarily in countries such as Poland, which can find in it a support tool for their investments in the defensive sector. The condition for obtaining loans will be the preparation of the national plan by countries.
