Italy Will Take the EU Defense Loan After All, Just Nearly Half of What It First Planned to Ask For

Italy has confirmed it will request a loan from the European Union's SAFE defense fund after months of visible hesitation, but the number attached to that yes is smaller than originally planned. Rome will ask for 8 billion euros, about 9,3 billion dollars, roughly half the 14,9 billion euros the government had floated earlier this year, out of a 150 billion euro fund the EU set up to help member states accelerate defense spending.

The hesitation was political rather than strategic. Prime Minister Giorgia Meloni's government sat on the decision for months in part because of the League, the coalition partner that has consistently argued domestic public spending should come before new defense commitments, and because opposition parties and a meaningful share of voters have pushed back on higher military spending with national elections due next year. Confirming the request at all took Rome longer than most other large EU member states, several of which signed on to SAFE loans well before Italy did.

The money is earmarked for hardware already on order, 1.050 Lynx armored fighting vehicles and 272 Panther tanks, part of a broader 23 billion euro program built jointly with Leonardo and Germany's Rheinmetall. That program was already trimmed once, in July, when Italy's defense ministry announced an 18 percent cost reduction that pointed toward delays and smaller orders even before the SAFE loan amount itself was cut in half.

Meloni's own comments at NATO's summit in Ankara in July hinted at where some of that hesitation comes from. Today, she said, what is happening in Ukraine shows that a tank worth millions can be destroyed by a drone worth 20.000 euros, a line that reads less like an argument against buying tanks and more like an argument for spending the defense budget differently than the current 23 billion euro vehicle program does. Whether that skepticism shapes how the smaller 8 billion euro loan actually gets spent, or simply explains why Rome took so long to ask for it, is the question the next round of procurement decisions will answer.