Overview

• The European Commission has proposed the ReArm Europe plan, offering €150 billion in defense loans and loosening fiscal rules to boost military spending across member states.
• European leaders are responding to reduced U.S. support for Ukraine with unprecedented defense investments, including a broader €840 billion military readiness initiative.
• Germany, France, and other nations are prioritizing defense modernization, with Germany planning constitutional amendments to exempt defense spending from fiscal constraints.
• The EU's military buildup highlights gaps in conventional and emerging technologies, such as hypersonic weapons and advanced air defense systems, where Europe lags behind global powers.
• European defense manufacturers are experiencing record stock gains as nations ramp up procurement, revitalizing a defense industrial base that had diminished after decades of reduced spending.