Published by Global Banking & Finance Review®
Posted on February 27, 2026
2 min readLast updated: April 2, 2026
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Poland’s parliament approved a law to channel €43.7bn in EU SAFE defence loans via state development bank BGK, but President Karol Nawrocki could still veto it amid nationalist pushback. SAFE offers up to €150bn in long-maturity EU loans tied to procurement rules aimed at boosting Europe’s defence i
WARSAW, Feb 27 (Reuters) - Poland's parliament on Friday passed a law creating a mechanism to spend 43.7 billion euros ($51.6 billion) in European Union loans to boost the military, setting up a dilemma for the nationalist president, whose backers want him to veto it.
Warsaw was the biggest beneficiary of the EU's 150-billion-euro Security Action for Europe (SAFE) initiative to boost the continent's armed forces, but the programme has been hotly debated in Poland as nationalists oppose Brussels getting involved in defence.
The nationalist opposition party Law and Justice (PiS), which backs President Karol Nawrocki, says SAFE would limit arms purchases from Warsaw's most important ally, the U.S., and that it will come with conditions purportedly intended to allow German meddling in Polish affairs.
Prime Minister Donald Tusk's pro-European coalition government says the funds have no such strings attached and that the cheap financing provided by SAFE is essential to Poland's security in the face of what it says is a rising threat from Russia.
"Without the SAFE programme, we have no other option to build an even stronger army and have better-equipped and safer soldiers in such a short time," Defence Minister Wladyslaw Kosiniak-Kamysz told a press conference.
The bill will enable the state development bank BGK to operate a fund that disburses the cash. The government says if Nawrocki vetoes the law, some workarounds are available, but it will not be able to use SAFE to its full potential.
"The losses will be very significant," Tusk said on Thursday.
Nawrocki has declined to say what he will do.
"This issue is so important to the Polish state and evokes so many emotions that I won't say what decision I'll make," he said on Thursday. "We'll make a decision when the time is right."
($1 = 0.8470 euros)
(Reporting by Alan Charlish, Pawel Florkiewicz; Editing by Kevin Liffey)
It passed a law creating a mechanism to spend €43.7 billion in EU loans under the Security Action for Europe (SAFE) initiative to boost the military.
The bill enables the state development bank BGK to operate a fund that disburses the cash.
PiS says SAFE would limit arms purchases from the United States and would come with conditions that could allow German meddling in Polish affairs.
Prime Minister Donald Tusk’s government says SAFE has no such strings attached and that cheap financing is essential to Poland’s security given what it calls a rising threat from Russia.
The government says some workarounds are available, but Poland would not be able to use SAFE to its full potential and the losses would be very significant.
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