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The Telegraph: EU leaders pressure Starmer to join defence scheme after Trump threatens Nato

byRoh Stephan
24. January 2025

EU leaders have an idea of how to finance the +200’000 peacekeeper force for Ukraine as demanded by V Selensky, in particular, if the US does not participate:
A 500 Billion debt fund, guarateed by the EU but where the modalities of repayment are not yet decided. This money would be spent on Ukraine and may help also to increase the EU military spending in view of Trump’s threat re 5% of GDP.
The EU is pressing PM Starmer to have the UK participate and it may be a sweet deal for Starmer as the UK has no money, cannot raise so much debt and the sour moment of reckonning may happen much later when Starmer is no more responsible for the repayment of the EU debt.

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As far as The Telegraph explains it: the EU is preparing a special €500 Billion Fund financed by debt subscribed by the EU, comparable to the EU Corona Fund (of €750 Billion).

The EU Corona Fund has no clear rules for a repayment unless the general rules of the EU apply and each member state must finance it according to its economic power. If one country will withdraw and not pay, all other countries will have to share the burden according to the same principle of economic power.

As a result, Germany, the economically most powerful EU contry will pay most, and even much more if another EU country cannot/will not further participate financially.

This would apply to the €500 Billion EU Special Debt Fund for Ukraine as well. The underlying principle is, therefore, a transfer of debt from one EU country to another, mainly to Germany.

If the UK will participate in this EU Special Debt Fund for Ukraine, it may be for the UK not only a question about its obligations resulting from its subscription but also of its risks resulting from guaranteeing an EU Fund for other EU countries.

Didn’t the UK want to brexit from the EU precisely also for that reason, i.e. not to be responsible for the debts of other EU members?

Lots of questions to resolve and lots of things to explain to the voters in each country … and how easy it is for the EU to issue debt instruments and to sell them to the European Central Bank in exchange for newly printed money that is eventually fueling inflation, increasing interests and damaging the currency … and the economy …. while all that money is sunk in Ukraine.

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