Equipment and soldiers at the media day of the mechanised Arrow 24 exercise, led by the Army’s Armoured Brigade, at the Niinisalo garrison in Kankaanpää. Photo: Emmi Korhonen / Lehtikuva
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The Finnish Parliament has approved the government’s support for a proposed €150 billion joint EU loan instrument to fund defence projects across member states. The scheme, known as the Safe instrument, would allow the European Commission to borrow directly from financial markets and distribute the funds to member states for national and joint military procurement.
The approval came from Parliament’s Grand Committee on Friday, giving backing to the government’s positive stance.
Heikki Autto (National Coalition), who chairs the committee, said the mechanism is needed to strengthen Europe’s defence capacity, particularly in areas that have seen long-standing underinvestment.
“This instrument is needed for European countries to strengthen their own defence capabilities. There have been clear shortcomings, especially in land force readiness,” Autto said.
The proposal has raised concerns about financial risk-sharing. Although the Commission’s draft regulation states that each country is responsible for repaying its own borrowing, it includes a clause that could see joint responsibility if a member state defaults. In such a case, the remaining states would cover the gap based on their share of EU GDP.
According to the Finnish Ministry of Finance, Finland’s theoretical maximum liability in a worst-case default scenario would be €2.4 billion.
Miapetra Kumpula-Natri (SDP), deputy chair of the Grand Committee, said Finland has always emphasised clear limits when it comes to EU-level borrowing.
The opposition had proposed explicitly stating Finland’s exposure in the parliamentary position, but the proposal did not receive majority support.
On Thursday, during Parliament’s question session, SDP MP Pia Viitanen asked Finance Minister Riikka Purra (Finns Party) why Finland now supports joint EU debt, despite previously opposing it.
“Safe does not increase Finland’s liability,” Purra replied.
Still, EU law professor Päivi Leino-Sandberg from the University of Helsinki said the answer is not so simple.
“If the Union takes on debt, member state liabilities increase, that’s unavoidable,” she said.
However, she added that the 2020 Own Re
Source: www.helsinkitimes.fi
