EU Parliament Approves $1.7 Billion Defence Investment

BRUSSELS (Reuters) -The European Parliament approved a 1.5 billion euro ($1.7 billion) scheme to fund defence investments across the European Union and support Ukraine, it said in a statement on Tuesday.

The European Defence Industrial Programme (EDIP), part of a broader drive to re-arm Europe sparked by fears of Russia following its 2022 invasion of Ukraine, aims to boost the continent's defences and streamline production.

To secure funding under the scheme, which runs until 2027, at least 65% of the cost of components of a defence product must originate in the EU or partner countries.

European Parliament President Roberta Metsola said in a post on X that the EDIP will be used to strengthen the EU's defence industry, boost joint procurement and manufacturing, and increase the EU's support for Ukraine.

Governments had long wrangled over eligibility and other issues around the EDIP. France had pushed for strict 'buy European' rules to boost European industry while countries such as the Netherlands argued for more flexibility to buy arms from the United States, Britain and other nations.

The Parliament's approval is the last step in the legislative process before the EU's 27 member states give the programme their endorsement, which is expected to be a formality.

($1 = 0.8675 euros)

(Reporting by Alessandro Parodi; Editing by Andrew Gray)