New financing path

Magdalena Sobkowiak-Blacknecka.

How will SAFE projects be financed?

After signing a debt agreement with the European Commission, we will receive 15% advance from the amount of EUR 43.7 billion and another tranche of money will be transferred in October 2026. In the following years, transfers will be made twice a year, in April and October. Each of these payments should be treated as a fresh loan, and their size will depend on the stages of implementation of the individual projects, due to the fact that we will be obliged to study to the European Commission on their progress.

Initially, we pay only interest for 10 years, and we are 45 years old to pay off the full debt. What are the costs?

It is worth explaining that interest will be paid on real money received, not on the full amount allocated. The interest rate on loans from SAFE will be just over 3%, which is much little than on loans to United States arms purchases is South Korea. If any program is not full implemented at a given moment, we will get the money for the part that we managed to perform. Besides, we do not gotta spread out the repayment of all the loans received for 45 years and we can do so earlier. However, any country, including Poland, if it finds a more favourable way of financing, may quit the continued usage of SAFE. For more than PLN 40 billion, the Ministry of Finance already estimates our profits today, that we usage SAFE, not another way of financing modernization.

EU loans will not benefit countries specified as Germany or Sweden. Why did their authorities quit this instrument?

Germany, Sweden, the Netherlands are high-rated countries that can borrow on their own on even more favourable terms than the EU. However, the east flank states, but besides Belgium, France, Greece, Spain, Portugal, Italy, applied for backing from SAFE. In fact, it did as many as 19 countries.

Both the supplier and its product must meet circumstantial criteria in order to finance the project. First of all, the company must operate in the EU and most of the components of the final product are to come from associate States, Ukraine and countries belonging to the European Free Trade Association and the European economical Area, specified as Norway and Switzerland. Will specified rules not adversely affect the acquisition of arms and military equipment from suppliers outside Europe?

SAFE does not mean giving up arms purchases outside Europe, as it will establish a fresh 3rd financing way for arms transactions. Purchases in non-EU countries will proceed to be made from state budget or Armed Forces Support Fund. It should be borne in head that a large part of the MON’s purchasing budget is utilized to handle loans already funded by 16 contracts. The amount of budget available for fresh projects is so limited.

The SAFE instrument, lending purchases in Poland and another European countries, will let to usage the money from the Ministry's budget and the FWSZ to finance arms orders from another suppliers. Therefore, SAFE is simply a key tool to accelerate the modernisation of the Polish armed forces. It should besides be remembered that thanks to our efforts in products purchased under SAFE, they can be components from companies outside Europe worth 35%, due to the fact that any EU countries wanted stricter restrictions.

Is there no danger erstwhile it comes to projects implemented by Poland itself, since contracts with their contractors must be signed by the end of May?

This should take into account the fact that any of them have already been signed due to the fact that we can finance fresh equipment contracts concluded with SAFE since the end of May 2025, specified as the programme concerning San anti-drone system.

There were 139 projects in our proposal. The European Commission rejected 10 of them?

No, that's how only 2 projects for the State Protection Service fell out of the program. The main reason for reducing the number of projects is to combine any of them, and we reported them as separate. The EC has adopted our arms projects unchanged.

What do you think is Poland's top success in negotiations about SAFE with the European Commission?

Firstly, the first European defence programme on this scale was launched. Secondly, the European Union is engaged in a defence area that it usually does not. It was thanks to the Polish Presidency. We are effective in the Union.

How was a list of military programs created?

Nobody imposed on us what to order and with whom, due to the fact that the needs of the armed forces were defined by the General Staff of the Polish Army. Importantly, we managed to push through negotiations with the European Commission, so that most of Polish purchases would be carried out on their own with home producers, which will make it to them up to 89% of the funds from SAFE.

If there are problems with the implementation of a task or there is simply a fresh urgent request to acquisition an arms system, can you exchange projects submitted to SAFE?

This chance has been emphasised in the negotiations with the European Commission, due to the fact that although 2030 seems close, technological advancement is very fast and the military can point to the request to get certain systems. After all, before the outbreak of a full-scale war in Ukraine, we did not full realize the importance of the function of drones on the battlefield. It would not be hard to identify fresh projects due to the fact that there is simply a reserve list – the needs of the armed forces are truly large. However, there is any crucial limitation, since May 2026, they must be common in nature, i.e. they must be implemented by at least 2 countries.

Who will implement the national SAFE projects?

The key contractor will be Polish Armed Forces Groupbut the function of large private companies as WB Group. delight besides remember that PGZ-etu companies have long had many private co-operators. Through SAFE, we will improve the condition of the indigenous arms industry, both state and private, and thus strengthen our sovereignty. We estimation that the effects of SAFE will be felt by about 12 1000 economical operators.

What companies were considered Polish?

The Armed Forces Agency evaluated companies, taking as a criterion whether their products are manufactured in Poland.

What can SAFE do to our companies too home contracts?

The EU instrument gives impetus to the wider entry of Polish arms into abroad markets, as weapons manufactured by our state and private companies can be bought by another countries utilizing the resources of SAFE. It is besides an chance to enter into fresh industrial partnerships.

Which countries may be curious in purchasing our weapons?

Greece, Romania and the Nordic and Baltic countries can besides be crucial partners. By the end of May we will know who decides to place orders in the Polish armory.

Opposition representatives fear the anticipation of blocking payments from SAFE, as was the case with the National Recovery Plan. Is there specified a threat?

In both cases, the provisions on the reasons for stopping backing are different, so it is simply a mistake to look for analogy here. Measures with SAFE may be blocked erstwhile suspected corruption occurs. In the case of KPO, however, there was a condition for compliance with the regulation of law.

What is the biggest challenge of SAFE?

Certainly the deadline for projects to be completed by the end of 2030. Although the European Commission has shown large flexibility on many issues, there is no chance of concessions in this case.

Is it possible that erstwhile SAFE is completed, the European Union will implement a fresh defence support mechanism?

SAFE was created as a bridge between the current budgetary position and the fresh EU budget. There are discussions about SAFE 2 in terms of even closer cooperation between associate States' arms industries, but it is besides early to find whether it will arise. For now, everyone is focusing on taking this first step, implementing SAFE and seeing how it works in practice. If its implementation goes well, the chances of a fresh initiative will increase.

Magdalena Sobkowiak-Czarnecka is simply a government proxy for the instrument to enhance Europe's security. From 2024 to 2025, she was Undersecretary of State for European Affairs at the Chancellery of the Prime Minister of the Council of Ministers.