European Investment Bank steps up multi-billion defence investments

The European Investment Bank (EIB) intends to ramp up its investments in European defense such as drones, satellites and cyber security, aiming to inject a further 6 billion euros ($6.4 billion) into the sector, its head told Reuters, Report informs.

The plan underscores an increasing willingness in Europe to lend to defense companies after Russia's invasion of Ukraine changed an entrenched view that the region was safe from attack and could rely on the United States for protection.

"It's clear we need to reinforce Europe´s security and defense industry," EIB president Nadia Calvino told Reuters. "We have earmarked 8 billion euros to invest in this area, of which only 2 billion have been invested."

The move marks another modest attempt by Europe to keep up with Russia, which has put its entire economy on a war footing.

Calvino said a special team had been set up to invest the money. "We have established a dedicated office to accelerate the deployment of the 6 billion euros earmarked," she said.

"We are engaging actively with the European industry so it is to be expected that a pipeline of projects will be developed in the second part of the year," she said, highlighting border security, military mobility, de-mining and military hospitals.

The EIB, backed by countries in the region, has large financial clout, although it is treading carefully in backing defense. It has backed a satellite project in Poland and a German drone maker but steers clear of ammunition, for instance.

The EIB recently changed the rules underpinning its activity, allowing it to lend to, or indirectly invest in, defense firms.