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EU: European Investment Bank proposes giving 2bn per year to "dual-use technology, cybersecurity and civilian security"

28 February 2018

EU  
European Investment Bank proposes giving €2bn per year to "dual-use technology, cybersecurity and civilian security"
28.2.18
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The European Investment Bank (EIB) has proposed providing financing of up to €6 billion over three years "in the areas of dual-use technology, cybersecurity and civilian security", in response to a December 2016 invitation from the European Council and ongoing suggestions from the Commission that more money is needed for EU security and military policies.

According to the EIB Group "Operating Framework and Operational Plan 2018":

"Concerning defence and security, Europe now faces starker threats to its internal and external security than at any time since 1945. Faced with unprecedented terror and online attacks, the EU leadership has acted to reassure citizens that it is capable of protecting and defending them, and the European Council has asked EIB Group to step up its activities in support of the EU Security and Defence Agenda. The Group has responded by developing a proposal Protect, Secure, Defend: European Security Initiative to provide a framework for increased contributions in this area. The proposal foresees that the Group would significantly scale up its financing to EUR 6bn over 3 years in the areas of dual-use technology, cybersecurity and civilian security whilst leveraging its expertise to provide assistance to the establishment of the Cooperative Financial Mechanism (CFM) under the responsibility of the European Defence Agency (EDA) as well as to the nascent European Defence Fund." [emphasis added]

See: Our Purpose, Our Future, Our Plan: The EIB Group Operating Framework and Operational Plan 2018 (pdf)

The proposal demonstrates the increasing weight being given to EU security and defence policies, although there is little further detail in the document about how the EIB "framework" might function.

The December 2016 European Council conclusions (pdf) invited the EIB "to examine steps with a view to supporting investments in defence research and development activities." The proposed inclusion of cybersecurity and civilian security suggests that the EIB plan would go beyond this into the realm of internal security.

At the EIB's annual press conference in January (pdf), Werner Hoyer, the bank's president, made this possibility clear: "We will be more active in dual-use technologies for both defense and civilian applications."

He subsequently said in response (YouTube, link) to a question from Jane's Defence Weekly that:

"Although we do not intend to invest into weapons production, that's not our business, helping the MS to make Europe a safer and more secure place is of course an obligation for the bank to fulfil. And in the crisis of migration it has become very obvious that the expectations of the MS and the European institutions vis-a-vis the bank are enormous, we try to meet that.

We will be very careful not to have a negative impact on our funding activities because we need the money from the capital markets and we will be very cautious not to be considered as a weapons producer or as somebody who supports the production of lethal weapons, that is not our job, but security and defence are a much wider concept where a bank like ours can have a significant impact, and I have promised the European Council that we are intending to go that way."

With regard to the forthcoming European Defence Fund - worth almost €600 million between 2017 and 2020, and a proposed minimum of €1.5 billion annually between 2021 and 2027 - the Commission highlighted the potential role of the EIB in June last year, when the Fund was launched:

"What are the links between the European Defence Fund and the European Investment Bank?

The capability window includes the possibility of using financial instruments to support SMEs and mid-caps in closing the gap between research and development. The Financial Toolbox also provides for the use of guarantees on project-related funding of suppliers. These financial instruments could be implemented with the European Investment Bank (EIB) group or other relevant partners.

Currently, although the European Investment Bank (EIB) group can support some relevant investments, such as i) Research development innovation for dual-use technologies, as far as these investments can be motivated by their commercialisation in civilian applications; ii) protection of physical infrastructures; and iii) telecommunications and information infrastructure.

The EIB has already announced its willingness to scale up these investments and engage with the Commission and Member States to assess if there are gaps in its policies."

See: The European Defence Fund: Questions and Answers (European Commission, link)

The EIB proposals are just one of many efforts to raise more money for military and security policies, as highlighted by the European Network Against the Arms Trade:

"In its European Defence Action Plan presented on 30 November 2016, the EC proposed an increased use of the EU Structural Funds (ESIF) and of the Regional funds (ERDF), encouraging the creation of “regional clusters of excellence” in the field of defence, as well as access to COSME funds (Programme for the Competitiveness of Enterprises and SMEs). The arms sector also became a priority under the new Skills Agenda for Europe, by supporting an “industry-led European Defence Skills Alliance” and making use of EU funds such as COSME and … Erasmus+, the EU programme for education, training, youth and sport!"

The Network highlights that:

"There is a clear trend towards considering the arms industry as a ‘normal’ business and ‘defence’ as a top priority: this paradigm shift was obvious in the 2016 ‘Statement to the Union’ of the President of the European Commission Jean-Claude Juncker (Q25), and all Commissioners have been asked to look for ways to contribute to the strengthening of the armament industry in their own field of action."

See: 3. Where will the EU money come from? Will Member States be obliged to contribute to the Defence Fund? in: All you want to know about the EU Defence Fund, and why this is not good for peace nor for jobs and growth(ENAAT, link)

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