Norway gets EU money from the weapons industry fund

Ine Eriksen SøreideForeign Minister Ine Eriksen Søreide meets EU Commissioner Jyrki Katainen.Photo: Johan Falnes / NTB scanpix

While the British may face exclusion, the Commission has decided to invite Norway into the EU’s new defence fund.


Norwegian politicians, diplomats and lobbyists have been pushing for months to gain access to the new honeycomb for the defence sector.

Now the European Commission has presented a detailed proposal for the framework that will apply to the Defence Fund for the next budget period, which runs from 2021 to 2027.

It appears that the fund will be opened for the three EEA countries,Norway,Iceland and Liechtenstein.

“We are very pleased with this,” said Defence Minister, Frank Bakke-Jensen of Høyre (H).

The money will provide funding for research and development of new weapons systems and other military equipment.

The European Commission will spend EUR 11.5 billion on the commitment over the seven years covered by the next long-term budget, measured at 2018 prices.

With today’s exchange rate it is equivalent to NOK 109 billion.

The money will go to projects involving at least three companies from three different
member countries.

“The fund is about cooperation,” explained EU Industrial Commissioner, Elzbieta

The EU’s goal is for the money to reach small and medium-sized businesses, she
emphasised. The big industrial giants are not allowed to get take everything.

Strict criteria
The goal is to give a boost to European arms manufacturers. Companies from countries outside of Europe can only participate if they meet strict criteria.

In this way, the EU will ensure that the money does not disappear to the powerful defence industry in the United States or to companies in countries such as China and Russia that may have dishonest intentions.

“This is European money to go to European projects,” said EU Foreign Minister Federica Mogherini.

But the door isn’t closed completely.

The reason is, among other things, that the weapons industry is characterised by compound ownership, which in practice makes it difficult to close out third party countries completely.

British concern
The fund has already raised some irritation among Allies outside Europe, and the United States

has warned the EU to make the new commitment to a “tool of protectionism”.

Another issue is the British defence industry, which will initially stand outside the fund after Brexit.

The case has created concern on the British side and could be a complicating factor in the already difficult negotiations on their exit from the EU.

Lobbying victory
The Commission’s proposal is a major victory for Norway, which has in recent months driven an intense lobbying campaign to get the EU to open up the fund for EEA countries.

The proposal is still awaiting treatment in EU bodies, emphasised Bakke-Jensen.

“We do not know the outcome of this process, but the starting point is promising for Norway’s part,”he said.

Sources on the EU side anonymously indicated to NTB news that the question is considered to be quite clear now, as there have already been in-depth discussions with Member States and the European Parliament on which rules should apply.

Highly contingent
Bakke-Jensen believes fund entry is important for ensuring the Norwegian defence industry’s position,both in the European market and globally.

But participation is not free.

The Norwegian authorities have so far not given any price tag. However, according to NTB’s own calculations,the Norwegian budget could now be around NOK 2.9 billion.


© NTB scanpix / #Norway Today