Financial and Fiscal Architecture for Defence: Europe’s Capital System for Strategic Autonomy

Europe’s ability to defend itself no longer depends solely on its arsenals or its industries but on its capacity to finance deterrence at scale and over time. The Financial and Fiscal Architecture for Defence, the economic cornerstone of the Defence Readiness Roadmap 2030, represents a structural shift in how the European Union conceives security. For decades, national defence budgets operated in isolation, constrained by fiscal rules that treated military expenditure as a liability rather than an investment. The White Paper for European Defence identifies financing as the missing link between strategic ambition and operational capability. Through four key instruments — the Security Action for Europe (SAFE), the European Defence Industrial Programme (EDIP), the European Defence Fund (EDF), and the European Competitiveness Fund — the EU has created a coordinated capital ecosystem capable of mobilising more than €400 billion. This system formalises a new doctrine: defence as investment, deterrence financed as growth, readiness sustained by credit. It turns fiscal solidarity into strategic power, establishing for the first time a genuine European financial capacity for collective security.