CIO Tech Outlook Team | Friday, 20 June 2025, 13:58 IST
European Union governments have opted to raise the annual lending cap of the European Investment Bank (EIB) to €100 billion in 2024, well above last year's €89 billion. This action raises the EIB's ability to help the EU's defence industry, including the tripling of defence-related financing from €1 billion last year to well above €3 billion.
This announcement came only days in advance of the NATO summit, in The Hague, as domestic pressures continue for member states to heavily increase their defence budgets, especially with signs from the U.S. that it will soon be decreasing its commitments to European security.
EIB's President Nadia Calvino stated, "The governors have unanimously increased the financing ceiling for 2025 to a record 100 billion euros, stepping up financial support in three key areas: energy grids, with a record target of 11 billion euros, security and defence with a target of 3.5 billion euros, and TechEU, supporting Europe's technological leadership".
Also Read: IIT Guwahati Develops Tech to Treat 1,000 Litres Wastewater at Rs 20
While it technically cannot provide financing for weapons or ammunition, the EIB will provide funding for dual-use infrastructure and dual-use technologies, such as drones, helicopters, GPS systems and military bases. This included financing a new military base in Lithuania, along the border with Belarus, which will mark the first permanent stationing of German troops in a NATO (and EU) state since WWII.
In addition to defence, the EIB anticipates pouring large amounts of money into technology innovation and renewable energy. The bank plans to allocate €70 billion over three years to European tech companies through its Tech EU initiative, which is especially targeted on enhancing Europe's capabilities and pre-eminence in leading edge fields, including supercomputing, robotics, artificial intelligence and clean energy, and is designed to enhance the European ability to compete with China and the U.S. Of that total, €40 billion will be loans, €20 billion equity and quasi-equity, and €10 billion guarantees, that will take place between 2025-2027.
The increase in lending followed EIB's mid-year operational review, along with last year's advance to raise its gearing ratio, permitting higher lending against its capital base.
