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A man works on an assembly line making shells at a weapons factory in Germany. (file photo)
A man works on an assembly line making shells at a weapons factory in Germany. (file photo)

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I am drilling down on two issues: the EU’s attempt to ramp up its defense and the bloc finally hitting Russian fertilizers.

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Briefing #1: Brussels’ $170 Billion Plan To Boost European Defense Capabilities

What You Need To Know: On May 27, the European Union will formally approve its 150 billion euro ($170 billion) scheme to boost defense spending in the bloc.

The so-called SAFE (Security Action For Europe) regulation was first proposed in March by the European Commission in response to calls from member states for financial and political support to meet new defense targets pushed by NATO -- and to potentially step in for Ukraine, should the United States shift its focus elsewhere.

The final regulation, seen by RFE/RL, spells out clearly that “the threats posed by Russia and Belarus are of particular urgency and relevance,” and need to be countered quickly.

Due to the time required to develop defense products and scale up industrial production capacity across the EU, the regulation also says it will be “vital” for the union to start supporting member states “as soon as possible so that they can place orders very rapidly.”

Brussels first responded to the member states’ calls by triggering the EU’s national escape clause for military spending, meaning that expenditure for items like weapons and ammunition won’t be accounted for in the bloc's punishment mechanism for countries breaching EU spending limits.

Deep Background: That created fiscal leeway -- but member states also need the cash as soon as possible. With several capitals keen to access the proposed funds quickly -- and with no need for unanimity or consent from the European Parliament -- EU ambassadors approved the new legislation on May 21, with only Hungary going against it.

The new scheme functions the same way as the EU’s recent COVID-19 recovery program, which was worth 800 billion euros ($920 billion).

For SAFE, the bloc will use its triple-A credit rating to raise the required 150 billion euros on the markets and then loan it to member states. In this sense it will be much cheaper than having most EU members trying to generate the funds themselves by borrowing separately.

Five EU countries -- Denmark, Germany, Luxembourg, the Netherlands, and Sweden -- currently enjoy a triple-A rating, so they most likely won’t need to participate in the scheme, leaving more of the potential loans for poorer members.

The fact that the loans have a maximum duration of 45 years, don’t need to be serviced in the first decade, and countries won’t have to pay VAT on the equipment purchased are other advantages that Brussels hopes will trigger a European defense splurge.

Drilling Down

  • But there are, of course, some strings attached to all this. First of all, many indebted southern member states complain that -- unlike the COVID recovery scheme, which also included a grant component -- this initiative is exclusively a loan, which will place an even bigger burden on already strained public finances.
  • SAFE is also supposed to stimulate joint defense procurements between countries, with the European Commission keen to use the instrument to create a proper European defense market instead of the nationally fragmented one that largely exists today.
  • Countries can apply for loans without teaming up with another state during the first year only. After that -- from late 2026 to 2030 (when the scheme expires) -- two or more countries must apply jointly.
  • In order to ensure the money is fairly distributed, the share of loans granted to the three member states getting the biggest allowance should not exceed 60 percent of the entire 150 billion euros allocated to the scheme.
  • But the big issue in the past month has been who can participate in SAFE -- balancing various member states' desire to boost domestic production with the reality that not every component can be made in the EU.
  • For starters, the countries in the European Free Trade Association (EFTA) -- Iceland, Liechtenstein, Norway, and Switzerland -- are included in the scheme. The same is true of EU candidate country Ukraine.
  • The regulation justifies their inclusion by citing “those countries’ close partnership with the Union in industrial defense production” and the fact that “Ukraine is directly faced with Russia’s ongoing war of aggression.”
  • Even so, there have still been grumbles. The United States, in particular, has complained about being locked out of this process. And many EU member states -- still keen to maintain transatlantic military links while also keeping other close partners involved in aspects of SAFE -- have also lobbied hard to open up the scheme to further outside participation.
  • In the end, a “65-35 rule” was settled on. That means that 65 percent of the value of the weapon acquired has to be generated in the EU, the four EFTA countries, or Ukraine. The other 35 percent can be produced elsewhere, such as the United States, for example.
  • But it gets a bit more complicated. If a country has a Security and Defense Partnership (SDP) with the EU, 65 percent of the value of the weapon can come from that state. The United Kingdom recently penned such a deal with the bloc -- and Albania, Japan, Moldova, North Macedonia, and South Korea also have similar deals in place.
  • Ultimately, as one EU official who spoke to RFE/RL put it, the upshot is “a classic Brussels compromise” -- a rather big deal has been struck but the money won’t start flowing until everyone, including many outside the family, gets their fair share.


Briefing #2: The EU Finally Hits Russian And Belarusian Fertilizers

What You Need To Know: On May 22, the European Union took a major step toward getting rid of Russian and Belarusian nitrogen-based fertilizer imports in the bloc.
In a European parliament session in Brussels, EU lawmakers overwhelmingly voted to introduce gradual duties on such products, starting on July 1.

But Moscow and Minsk won’t feel the pain immediately.

The current 6.5 percent tariffs on fertilizers from the two countries will remain but what will be added are duties of 40 to 45 euros ($45-50) per ton up to mid-2026.

This is still not too much of a hit, and trade is still expected to happen. But then the duties will become gradually higher, rising to 60 euros ($68) per ton from mid-2026 and then to 80 euros ($90) per ton in 2027 before finally going up to 350 euros ($398) and 430 euros ($486) per ton by 2028, essentially making it economically unviable to buy the products from Belarus and Russia.

Deep Background: The move comes amid rising concerns about Europe's increasing dependence on fertilizers from Russia, where an abundance of cheap energy makes production -- and consequently the end product -- substantially cheaper.

In 2023, the bloc imported 3.6 millions tons, worth 1.28 billion euros ($20.4). This constituted 25 percent of total EU imports, making Russia the single biggest exporter of fertilizer to the EU.

Last year, this upward trend continued with 4.4 million tons of Russian fertilizers entering the European Union, taking the import share up to around 30 percent.

The fertilizer trade with Belarus is small -- worth just 30 million euros ($34 million) last year, but Brussels has decided to target it as well due to the close political and economic ties between Minsk and Moscow and the fear of Russian fertilizers entering via Belarus if the duty regime isn’t synchronized.

The proposal also increases EU tariffs by 50 percent on the value of Russian and Belarusian agricultural products such as sugar, vinegar, flour, and animal feed.

The bloc had previously been reluctant to hit Russian agricultural products with sanctions given accusations from poorer countries in Asia and Africa that such moves cause food shortages.

The situation has been somewhat alleviated over the past year with Ukraine resuming exports of its food produce via the Black Sea.

The European Union has also pledged that the transit of Russian and Belarusian agricultural exports through the bloc to the rest of the world is still possible.

Drilling Down

  • The hope is that EU fertilizer producers can now step up to compensate for the shortfall caused by reduced Russian imports. While high energy prices may increase production costs, the proposal notes that the European industry still has about 20 percent spare capacity -- approximately 3 million tons -- despite some facility closures due to energy costs. In addition to the 9.5 million tons of nitrogen fertilizers exported in 2024, this unused capacity “could almost completely compensate for the shortfall of reducing Russian imports into the EU.”
  • The EU is also hoping that the measures will mean a diversification of supplies with increased imports from countries like Algeria, Egypt, Morocco, and Oman, places Brussels is keen to forge closer relationships with.
  • It has also not escaped the bloc’s attention that the United States wants to export more fertilizers. Following the suspension of US President Donald Trump’s April tariffs on the EU, some sort of larger transatlantic trade deal is possible, and this could very well be part of any potential package.
  • All this means that the proposal has met with minimal opposition after being presented by the European Commission in late January. The 27 EU member states left the regulation completely untouched, which is quite rare, and in the vote in April only Hungary voted against it, with Belgium and Bulgaria abstaining.
  • As this is a trade regulation, unanimity is not required -- only a qualified majority (55 percent of member states representing 65 percent of the EU population) and a simple majority in the European Parliament.
  • This relatively new approach by Brussels -- using trade regulations to target Russian exports instead of sanctions, which require consensus -- may become a more frequent strategy for the EU to circumvent potential vetoes.
  • In June, the European Commission is due to present several legislative proposals to phase out imports of Russian gas, nuclear materials, and oil over the next two years, using the same method as with the fertilizers.


Looking Ahead

On May 28, the European Commission will present its strategy for the Black Sea region -- an effort by Brussels to strengthen ties with countries such as Azerbaijan, Armenia, Georgia, Moldova, Turkey, and Ukraine amid growing Russian influence.

The document is expected to be short on concrete proposals and financial commitments, but will likely emphasize promises of closer cooperation on trade, security, and environmental protection.

That's all for this week!

Feel free to reach out to me on any of these issues on X @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.

Until next time,

Rikard Jozwiak

If you enjoyed this briefing and don't want to miss the next edition subscribe here.




US Ambassador to NATO Matthew Whitaker (left) and European Union foreign policy chief Kaja Kallas attend a meeting of the Ukraine Defense Contact Group in Brussels on April 11.
US Ambassador to NATO Matthew Whitaker (left) and European Union foreign policy chief Kaja Kallas attend a meeting of the Ukraine Defense Contact Group in Brussels on April 11.

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on one thing: my take from Tallinn and the road ahead.

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The Briefing: From Tallinn To The Hague: The Run-Up To The NATO Summit

On May 13, a Russian military jet violated Estonian and NATO territory for close to a minute after the Estonian Navy made an attempt to intercept a flag-less tanker, named Jaguar, thought to belong to the Kremlin's so-called shadow fleet transporting EU-sanctioned oil to and from Russia. The Sukhoi Su-35 was deployed to protect the vessel that later returned to the Russian port of Primorsk.

The incident was the first reported breach of Estonia's airspace since 2022 and somewhat indirectly set the tone for the Lennart Meri conference in Tallinn on May 16-18.

The Baltic state's largest annual think tank event was full of Western officials putting on a brave face when discussing the state of the war in Ukraine, Russian threats to the rest of the continent, and the United States' increasingly thorny relations with Europe.

The American Presence In Europe

Perhaps the most eagerly anticipated appearance was that of Matthew Whitaker, US President Donald Trump's newly appointed ambassador to NATO, especially with so many worries, notably in eastern flank countries like Estonia, over American commitment to the military alliance.

Seemingly hanging on to every word he said, most people in the room appeared relieved that he ticked most boxes. Yes, NATO is "the greatest alliance in world history." And yes, Russia is the security threat to the organization. He seemed to comprehend the argument, put to him by Polish Foreign Minister Radoslaw Sikorski, that if the Europeans will splash the cash on the defense, quite a lot of it will be spent on European arms companies as Europeans also have an electorate and workforce to satisfy.

Refusing to be drawn into discussion about his boss's designs on Greenland, he simply noted that Denmark, which the giant island belongs to, is "a great NATO ally" but that bilateral relations weren't his responsibility.

Then there was the whole issue of the American force posture review, which will happen in the latter half of the year. There is plenty of speculation among diplomats that Washington will cut down on troops in Europe and boost its presence in the Indo-Pacific theater instead.

Whitaker noted that nothing had been determined yet and that allies will be consulted on the process. He also promised everything would be orderly, meaning the United States would "ensure that there are no security gaps."

Did that reassure nervous NATO members bordering Russia? Not really, but those diplomats I spoke to were still defiant, pointing out that the United States could also remove soldiers from the western part of the continent to the eastern one as it's cheaper to maintain their presence there and it offers good exercise conditions.

Another one tried to sound reassuring by arguing that the US flag -- meaning any presence -- was still better than the actual number of boots on the ground.

The Hague (No) Show?

Otherwise much of the discussion in Estonia focused on the upcoming NATO summit at The Hague at the end of June. While the previous two summits, in Vilnius back in 2023 and Washington a year later, were all about Ukraine and the haggling about whether Kyiv should get a NATO membership invite and how to phrase the country's eventual path into the club, the war-torn country will now be almost absent from the discussions.

There is still not even confirmation that Ukrainian President Volodymyr Zelenskyy will be invited to the Netherlands after being the star guest at previous gatherings.

Whitaker did, however, note that he expected him to be present. The Estonian foreign minister, Margus Tsahkna, pointed out that it would be "a major stratcom mistake" if he didn't come as that would be all the media would write about from the gathering.

But forget any invitations or any other language on Ukraine's future place in the alliance, especially since Trump has seemingly ruled out Kyiv joining anytime soon. In fact, Ukraine may not be mentioned at all in the final summit declaration.

One European official told me it's probably better for now as any attempts to negotiate about it would probably make the text worse for Ukraine than the 2024 Washington summit declaration, which at least states that NATO "will continue to support it on its irreversible path to full Euro-Atlantic integration, including NATO membership."

The same dilemma is true for any wording on Russia, so Moscow simply might not be mentioned at all. In fact, the entire text might just be a few paragraphs, compared to nearly 40 from last year that covered all manner of topics.

Instead, the summit, which now has been shortened from three to two days, will focus on ramping up European defense spending and building up a transatlantic defense industrial base, according to NATO Deputy Secretary-General Radmila Sekerinska.

The main headline will be the commitment by the 32 allies to reach 5 percent of GDP on defense spending, up from the current target of 2 percent. They should also dedicate 3.5 percent to "hard targets" such as arms and artillery, and the remaining 1.5 percent to cyberdefense, investment in military mobility, and the like.

But of course, all eyes will be on Trump, both in the Netherlands and in the run-up. Despite the fact that the much-hyped first direct Russia-Ukraine meeting in three years in Ankara last week turned into a lower-level nothing burger in which Moscow only repeated its "maximalist" positions of land grabs and Ukrainian neutrality, most people in Tallinn still cautiously think a cease-fire of some sort is possible in the run-up to the NATO summit.

Trump, Putin, Cease-Fire

The expectation is that Trump and Putin will eventually meet. They spoke on the phone once again on May 19, but there are clear European fears about what Trump might agree to in such a setting.

No one I spoke to believes Trump is truly serious about imposing hard-hitting measures on the Kremlin. Republican lawmaker Lindsey Graham proposed imposing 500 percent tariffs on countries that buy Russian oil, and there has been talk of other "secondary sanctions" hitting countries like Belgium, the Netherlands, and Spain, which import a lot of Russian liquefied natural gas.

I also sensed a fear among officials that reestablishing US-Russia bilateral relations, including striking some sort of trade and investment deal, is more important to both sides than actually having a lasting peace deal in Ukraine. The almost universal assessment I heard is that Putin is playing "the long game" over Ukraine, and while the Ukrainian lines won't breach anytime soon, he thinks he is winning. Or as one official put it: "Ukraine and Russia are in fact both losing, but Russia is losing more slowly."

This all puts Europe in a bind. I've heard Paris is mulling reestablishing a direct line with the Kremlin. "The Americans cannot be the only ones speaking to them," as one official put it. But no official meeting with Moscow is in the making.

When asked at a panel discussion whether it was time to have another NATO-Russia Council (NRC), a dormant political format since 2022, the answer from both Tsahkna and Sikorski was an emphatic "no" with the latter adding: "It was an instrument in times of peace which limited troops in eastern flank states. As long as Putin is president, we cannot trust that country."

More Sanctions?

So, Europe will continue to push for more sanctions for now. Its 17th package, probably the bloc's puniest yet, will be officially agreed on May 20, and there is already work on the next one, which will contain more blacklistings, including both Russian entities and individuals but also vessels thought to belong to the shadow fleet.

There might also be sanctions against more Russian banks and against Nordsteam 1 and 2, which are no longer operational but still aren't officially targeted. There is also a desire from the Europeans for the Group of Seven summit in Canada next month to lower the oil price cap for Russia from the current $60 per barrel to at least $50.

However, EU officials I spoke to don't believe all of the measures will pass, notably as Hungary can continue to be a spoiler. Most are also worried that the sanctions rollover in July will still be a proper struggle with alternative solutions being studied, for example, not to allow Russian frozen assets in the bloc to expire.

The Dilemma

But the threat from Russia will still be there. And the Europeans, while saying they're ready to stand up to Moscow even without American help, are wary.

The reassurance force meant for Ukraine once there is a cease-fire probably won't be particularly reassuring. European army officials have admitted they lack the long-strike capabilities of the United States and notably its supreme intelligence, surveillance, and reconnaissance capabilities.

And time is short. An assessment earlier this year from the Danish intelligence service claimed Russia could be capable of starting a major war in Europe (outside of Ukraine) within five years. But the Europeans might have to be ready well before that. Onno Eichelsheim, chief of defense for the Netherlands armed forces, told the Lennart Meri conference crowd that "Russia can give us 'a dilemma' already within a year after a potential end of the fighting in Ukraine."

What that dilemma might be, he didn't specify. But as Estonia experienced with the airspace violation earlier in the week, all options appear to be on the table.

Looking Ahead

EU enlargement is stuck for Ukraine and Moldova as well as most candidate countries in the Western Balkans for various political reasons. But there is one country that appears to be rapidly marching toward Brussels and EU membership right now: Albania.

On May 22, the country will start negotiations on another eight EU accession chapters (there are 33 in total), and it comes just a month after it opened another batch of chapters. The key going forward for Tirana will be to actually close negotiations on these chapters, which is much harder than opening them.

Feel free to reach out to me on X @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.

Until next time,

Rikard Jozwiak

If you enjoyed this briefing and don't want to miss the next edition subscribe here.

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About The Newsletter

The Wider Europe newsletter briefs you every Tuesday morning on key issues concerning the EU, NATO, and other institutions’ relationships with the Western Balkans and Europe’s Eastern neighborhoods.

For more than a decade as a correspondent in Brussels, Rikard Jozwiak covered all the major events and crises related to the EU’s neighborhood and how various Western institutions reacted to them -- the war in Georgia, the annexation of Crimea, Russia’s support for separatists in eastern Ukraine, the downing of MH17, dialogue between Serbia and Kosovo, the EU and NATO enlargement processes in the Western Balkans, as well as visa liberalizations, free-trade deals, and countless summits.

Now out of the “Brussels bubble,” but still looking in -- this time from the heart of Europe, in Prague -- he continues to focus on the countries where Brussels holds huge sway, but also faces serious competition from other players, such as Russia and, increasingly, China.

To subscribe, click here.

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