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(Bloomberg) — Finnish Prime Minister Petteri Orpo said it is his personal opinion that EU members would not rule out joint borrowing if funds were deployed to strengthen security on the bloc’s eastern edges. Should be done.
Orpo said, “I do not rule out the option – as a personal point of view, there is no government stance on this issue – of using common European funding, including loans, for a rescue, provided that the money is used there. Where Europe is defended.” In an interview on state-owned broadcaster YLE on Saturday. “Europe has not been defended in the south or the west. It is defended here in Finland, in the Baltic, in Poland, in the eastern regions.”
It’s a surprising reversal in a country that typically strongly opposes pooling obligations over moral hazard concerns, or out of fear that joint borrowing makes governments complacent.
The EU’s new defense chief Andreas Kubilius has launched a new joint borrowing mechanism for military spending as part of the bloc’s plan to seek about €500 billion ($512 billion) for security over the next decade. Germany, the region’s largest economy, has been one of the members opposed to joint borrowing. But as Russia escalates its war in Ukraine, many governments that had opposed such a move are beginning to waver.
Former Finnish President Sauli Niinistö, who recently delivered a report on the EU’s readiness to respond to crises to European Commission President Ursula von der Leyen, noted that a missile shield could be financed by joint borrowing. Is. Prime Minister Mette Frederiksen of Denmark, among the EU’s “thrifty” countries, has also expressed greater openness to financing by joint debt.
France’s junior minister for European affairs, Benjamin Haddad, reiterated calls for Eurobonds to finance defense in the bloc in an interview with Le Figaro newspaper published on Saturday.
“Defense needs are so great that we can no longer finance them alone,” Orpo said.
–With assistance from James Regan.
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