In 2025, Brussels launched its first-ever common borrowing programme for defence. One year on, EU policymakers are already planning a second edition of the flagship financing tool — with a push to shift from loans to grants — although several key questions about its future remain unresolved.
The Security Action for Europe (SAFE) allows EU countries to borrow low-interest loans to finance defence spending outside the EU fiscal stability framework via the so-called national escape clause.
The programme has been running for about a year. Recent hybrid threats on the eastern flank — notably drone incursions — are accelerating member states' uptake of the loans, while also forcing EU policymakers to consider what comes next.
The most politically charged question for any revamp of SAFE is not whether reform is needed. Russia's war in Ukraine and the Trump administration's steady withdrawal from European security commitments make ramping up defence spending a geopolitical necessity.
"SAFE II is a tricky situation. When we say SAFE II everyone thinks only about loans, but the countries that have already taken these loans, especially on the eastern flank, they are saying: We don't want loans anymore. We want grants," a Commission official told Euronews, asking not to be named given the sensitivity of the topic.
