Trying to unpack he documents so far published, I think the picture is a bit more complex. On first read, I could identify a three tier approach to defence in the proposed package + relations to the UK: First tier is (obviously) EU member states, who are the only ones who can take loans from SAFE. - ThreadSky

nvondarza.bsky.social • 19 hours ago

Trying to unpack he documents so far published, I think the picture is a bit more complex. On first read, I could identify a three tier approach to defence in the proposed package + relations to the UK:

First tier is (obviously) EU member states, who are the only ones who can take loans from SAFE.

Reposted from Anand Menon

Shocking decison on the UK makes no strategic sense at all www.ft.com/content/eb9e...

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nvondarza.bsky.social•19 hours ago

This is not a major deal for the UK. The UK gets slightly worse interest rates than the EU, so would get a financial benefit for it, but as SAFE is guaranteed by the EU budget there is no way in hell the UK would have benefitted from loans.

westmanajay.bsky.social•18 hours ago

I agree - the exclusion of the U.K. is a red herring

nvondarza.bsky.social•19 hours ago

Second tier is which companies can benefit from joint procurement. Here the Q&A states that those should come from companies based in the EU, EEA/EFTA or Ukraine. This would exclude UK based companies, but include many joint venture or subsidiaries of UK defence companies based in the EU.

westmanajay.bsky.social•18 hours ago

It is more important that the U.K. and its defence companies are able to participate fully at this level of investment and co-ordination

marcoinbxl.bsky.social•19 hours ago

During the press conference, they just clarified that companies from third countries with which there is a bilateral agreement will also be able to bid. For the UK, Kallas indicated this would be the Defence & Security Partnership, which they're hoping to sign by May

nvondarza.bsky.social•19 hours ago

Third tier is who can participate in joint procurement, and this is stretched to EU plus EEA/EFTA plus Ukraine plus all candidate counries (e.g. Turkey) or countries with a Security and Defence Partnership.

This stretches as far as Japan. But not yet the UK.

westmanajay.bsky.social•18 hours ago

As with Tier 2 the U.K. and its defence contractors must find a way to participate fully

nvondarza.bsky.social•19 hours ago

However, the EU-Japan Security Partnership is very light on content, and the EU is even negotiating one with India.

It is clearly also negotiating something something along the lines of a 'Security and Defence Partnership' with the UK for the summit in May.

nvondarza.bsky.social•19 hours ago

On the current basis, for the UK this would mean no loans, only limited access for its companies but (likely) UK participation in joint procurement.

For the latter to work, I would argue the middle tier needs to be revisited. Negotiations will be quick, so this should be addressed soon.

nvondarza.bsky.social•19 hours ago

My proposal would be that the defence industry from any countriy participating in joint procurement should also be possible to include in such joint procurement. Otherwise it would be a real non-starter and lost opportunity.

hhesterm.bsky.social•19 hours ago

Quick question: do the procurement criteria you describe excluding UK based companies apply to joint procurement (which makes joing procurement theoretical for major countries)?

frisian.bsky.social•14 hours ago

SLightly worse?
Are you kidding?
Yield of 10-yr bonds:
EU: 3,3157%
https://www.boerse-frankfurt.de/anleihe/eu000a4d8kd2-europaeische-union-3-375-25-35
UK: 4,63%
https://www.bloomberg.com/markets/rates-bonds

robinfontaine.bsky.social•18 hours ago

Thank you for the breakdown and explanations. UK industries need to have legitimate opportunities but makes sense that Uk would not be included in the loans. I hope the summit will managed to bring a convincing defence partnership without interference other issues like the fishing rights.

paulolaranjo.bsky.social•44 minutes ago

Who is going to use the money as an advantage regarding their own capabilities? According to @spignal.bsky.social, very few.

https://bsky.app/profile/spignal.bsky.social/post/3lkqynzhdr226

jazzaoxon.bsky.social•16 hours ago

Why would the UK be included in the EU when we left it and stopped paying our dues in 2016. It's quite right we can't have a loan from SAFE. UK is part of Europe and other allies are joining the wider coalition in support of Ukraine. As mentioned in this thread, an EU-UK agreement can cone.

jazzaoxon.bsky.social•16 hours ago

I hope leavers rue brexit.

adamcain.bsky.social•18 hours ago

Thank you, helpful thread.

Nevertheless, this would seem to require HMG to get off its arse, and to approach this issue with both a sense of urgency and a degree of humility.

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