The European Investment Bank (EIB) has announced significant changes to its financing approach for defence projects, including the removal of existing limits on funding and an expanded scope of eligible projects. However, the EIB will still maintain a ban on financing weapons and ammunition.

Ahead of a key defence summit this Thursday, Nadia Calvino, EIB President, outlined plans to EU leaders in a letter, revealing that the bank’s measures are part of the European Union’s broader initiative to enhance defence financing in response to growing security concerns, particularly in light of the ongoing threat from Russia.

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As part of the new strategy, the EIB plans to propose a revision to its eligibility criteria during its March Board of Directors meeting. The adjustments aim to better define excluded activities, keeping them as minimal and precise as possible. Additionally, the bank is set to revise its operational framework to establish an annual financial and capital allocation for defence, ensuring it meets the increasing demands of the EU’s security needs while maintaining the bank’s strong financial position and ability to support other strategic priorities.

The EIB’s balance sheet totals €600 billion, and previously, the bank had targeted doubling its financing for defence projects to €2 billion by 2025, with an upper limit of €8 billion by 2027. With this new policy, the EIB will be able to fund large-scale strategic defence projects that include land border protection, military mobility, infrastructure protection, de-mining, cybersecurity, drones, and other critical technologies.

The change signals a shift in the EIB’s core public policy objectives, placing defence and security on par with other priorities like cohesion and sustainability. The new approach will allow financing for projects such as barracks, radars, helicopters, military facilities, and other infrastructure with no civilian use. However, weapons and ammunition will still be off-limits for EIB funding.

The shift in policy is also seen as a signal to investors and financial institutions, emphasizing that security and defence are now considered essential public goods. This stance contrasts with the bank’s exclusion of activities like gambling, tobacco, or pornography, sending a clear message that EU governments are prioritizing investment in national and regional security.