France Withdraws Opposition to EU Funding for Non-Member Companies

While Brussels is working to develop a stronger domestic defense industry that is less reliant on the United States, France has withdrawn its opposition to non-EU companies accessing EU-funded financial incentives for the European defense industry. According to information provided to the FT by five individuals familiar with the technical discussions held last week, French diplomats in Brussels expressed support for a proposal that would allow up to 35% of cash incentives funded by the EU budget to be spent on defense products from outside the 27-member bloc. This shift comes after Paris's nearly year-long resistance to allowing defense companies from countries like the U.S., the UK, Israel, and Turkey to participate in the EU's proposed European Defense Investment Plan (EDIP), justified by the need to support only its own domestic defense firms as part of Europe's "strategic autonomy" efforts. However, two officials noted that this position changed this month, indicating that it would be challenging for the EU to lobby newly elected U.S. President Donald Trump not to reduce U.S. military support for Europe while simultaneously excluding U.S. companies from efforts to develop the European defense industry. One of the officials remarked, "Since the [U.S. elections], everyone has been thinking a bit more strategically."