Brussels, June 23, 2025 (Lusa) - Portugal and nine other European Union (EU) countries have already expressed interest to the European Commission in using the €150 billion European programme of loans on favourable terms to strengthen defence.
European sources disclosed the information to the Lusa news agency, indicating that Portugal, along with Poland, France, Lithuania, Estonia, Romania, Bulgaria, Slovakia, Greece and Latvia, have already expressed “strong interest” in obtaining such loans.
The same sources stressed that formalisation will take place after the end of the July deadline, and allocation envelopes will become available before then.
In an interview with the Lusa news agency, which the media published over the weekend, Finance Minister Joaquim Miranda Sarmento acknowledged that the government could resort to the programme and defended joint acquisitions in the EU, specifically for the sale of a military aircraft produced in Portugal.
“It is possible that [...] SAFE will be used, although SAFE’s financing conditions are currently comparable to the Portuguese Republic’s financing conditions, and we are analysing all the alternatives that exist,” said Joaquim Miranda Sarmento.
A few days before the North Atlantic Treaty Organisation (NATO) summit - marked by strong geopolitical tensions in the Middle East and Ukraine and the need to increase investment in security - the minister also pointed out that ““Portugal produces a military aircraft, and the [Ministry of] Defence is currently developing agreements with other countries for them to purchase it.”
The idea is for Portugal to benefit from these EU loans (an initiative known as SAFE), to participate in European projects, and to sell equipment produced in the country.
“What the Ministry of Defence is doing […] is establishing protocols with other countries so that these countries can purchase this aircraft, which Portuguese industries produce primarily,” Joaquim Miranda Sarmento pointed out in the interview with Lusa.
The finance minister was referring to the KC-390, a twin-engine aircraft that manufacturers produce in Évora and that the Brazilian company Embraer also supplies components for.
It is a multi-purpose military transport aircraft designed for tactical and logistical use. Due to its intercontinental range, military forces can utilise it in various military operations, particularly NATO operations.
At the end of May, the EU Council adopted a package of €150 billion in loans on favourable terms for joint purchases to strengthen community defence. Countries can request these loans from Brussels until the end of the year.
The EU issues joint debt to finance this loan package, known as SAFE, and then transfers the funds in the form of loans to Member States that request them, facilitating joint purchases of military equipment among Member States.
This new European credit instrument for extraordinary circumstances is one of the measures in the €800 billion plan for defence in the EU.
Also included in this European plan is €650 billion in budgetary space that countries can have to invest in defence, after activating the national safeguard clause of the EU budget rules, which allows up to 1.5% of gross domestic product in military spending to be excluded from the deficit limits. Brussels has already given Lisbon the green light to do so.
The 32 NATO allies are meeting on Tuesday and Wednesday at a summit in the Dutch city of The Hague, driven by the urgent need to spend more on defence.
ANE/ADB // ADB.
Lusa
