Keir Starmer is leading the (Image: Getty)
Arms companies from the UK will be excluded from a new ￡125billion (€150billion) EU defence fund to boost European defence unless the Government signs a security pact with Brussels. US and Turkish defence firms are also not included in the Security Action for Europe (SAFE) scheme.
The fund will only be open to EU defence companies and those from third countries that have signed defence agreements with the bloc, according to a European Commission proposal proposed on Wednesday. The policy is a win for France and other countries that have demanded a “Buy European” approach to the continent’s defence investment push.
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At least 65% of the cost of the products would need to be spent in the EU, Norway and Ukraine.
The rest can be spent on products from third countries that have signed a security pact.
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The EU is trying to increase its arms spending in the face of Russian aggression and warnings from Donald Trump over long-neglected defence budgets and US security guarantees for Europe.
Kaja Kallas, the EU’s chief diplomat, said the decision to exclude the UK was “related to member states” and “different worries” in a veiled reference to French pressure.
But she added: “We are working on having this defence and security partnership with the UK.”
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Ms Kallas met Foreign Secretary David Lammy and Defence Secretary John Healey in London earlier this week to talk about working together on defence.
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The UK has attempted to be included in the initiative in light of its leadership over the “coalition of the willing” aimed at bolstering the continent’s defence capabilities.
Although talks on the UK joining the initiative is underway, it has hit a roadblock because of wider demands on a EU-UK pact over fishing rights and migration.