Brussels, July 8, 2025 (Lusa) - The European Union (EU) finance ministers gave Portugal the green light on Tuesday to invest more in defence while preserving budgetary discipline, approving the activation of the national escape clause.
“The Council today activated the national safeguard clause under the Stability and Growth Pact for 15 Member States to facilitate their transition to increased defence spending at national level, while ensuring debt sustainability,” the European institution bringing together EU countries said in a statement.
Meeting in Brussels today, ministers decided to support the assessment made in early June by the European Commission, when the EU government considered that, during the period 2025 to 2028, Portugal “is authorised to diverge and exceed the maximum rates of net expenditure growth”, provided that this remains within 1.5% of Gross Domestic Product (GDP).
In addition to Portugal, EU finance ministers adopted a similar endorsement of the activation of the national safeguard clause for 14 other Member States: Belgium, Bulgaria, the Czech Republic, Denmark, Estonia, Greece, Croatia, Latvia, Lithuania, Hungary, Poland, Slovenia, Slovakia, and Finland.
“The use of this flexibility should contribute substantially to strengthening the European Union’s defence and security capabilities and the protection of its citizens. It will also strengthen the EU’s overall defence readiness, diminish strategic dependencies, fill critical capability gaps and reinforce the European defence technological and industrial base across the Union,” the EU Council said.
Brussels made this recommendation for approval to the Council (comprising Member States) after Portugal formally requested that the European Commission activate the clause at the end of April, allowing part of defence investment to be exempt from budgetary rules as part of the EU's strategy to strengthen its military capabilities.
In a report on Portugal released in early June, as part of the European Semester spring package, the European Commission recommended that the country “strengthen overall defence spending and military readiness”, and to this end “respect the maximum limits for net expenditure growth” and “make use of the margin provided for in the national escape clause for an increase in defence spending”.
However, the European Commission has already warned that it will monitor the country’s deviation from the necessary investment in defence, calling for budgetary balance.
At issue is an €800 billion plan by the EU executive to strengthen the European Union’s defence, which provides for the possibility for EU Member States to activate the national safeguard clause, allowing them to spend with the assurance of avoiding excessive deficit procedures.
To this end, the Union allows an increase in public defence spending of up to 1.5% of gross domestic product per year, which will result in €650 billion over four years for the Union as a whole.
In practice, with the activation of this national safeguard clause, Member States can invest (voluntarily) more in defence, and these expenditures remain outside the budget balance, enabling the avoidance of excessive deficit procedures.
In Portugal, the government announced that it would bring forward to this year the target of 2% of GDP for defence, after allocating 1.58% of its GDP to the sector in 2024 (€4.48 billion).
ANE/ADB // ADB.
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