EU governments agree on 1.5 billion euro defence scheme

European Union governments have agreed on a 1.5 billion-euro scheme to fund defence investments, though some countries said its "buy European" rules are too restrictive, diplomats said on Wednesday.

The European Defence Industrial Programme (EDIP) is part of a broader effort to re-arm the bloc following the conflict between Russia and Ukraine.

Under the deal, at least 65% of component costs for funded items must originate in the EU or associated countries. France had pushed for stricter rules, while others, including the Netherlands, sought more flexibility to buy from the U.S., UK and other allies.

Ambassadors from the EU’s 27 countries are expected to formally approve the deal on Monday, before negotiations with the European Parliament.

A group of 10 countries - including the Netherlands and Baltic states - argued the rules should better reflect the urgent need to boost European defences, given the industry's current reliance on key foreign components.

Despite concerns, they said they would not block progress on the plan, which could receive more funding in future.

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