Les Echos article on defence financing quotes ASD

In an article this week, Anne Drif reported on the recent changes to the European Investment Bank’s (EIB) mandate and the implications for the defence industry. Responding to calls from France and 13 other Member States, the EIB removed a rule that limited its scope of action in the defence sector to dealing only with companies which generate the majority of their income from the civilian sector.

However, the EIB did not go further. In its press release of 8 May, it stated: “No other changes have been made to the eligibility criteria for financing from the EIB Group nor to the list of excluded activities and sectors”. 

Whilst ASD welcomed the step forward in facilitating access to finance for the sector, it called on the EIB to “eliminate the explicit exclusion of pure defence activities". ASD Secretary General, Jan Pie said "ASD believes that not only would this lead to a substantial direct strengthening of the sector, but it would also send an important signal to other financial market players – mainly private – who often continue to exclude the defence industry from their portfolios due to a misguided and oversimplistic misinterpretation and of ‘ESG’ (environmental, social and governance) criteria that are too simplistic”.

According to a study published by the European Commission in January, 40% of European SMEs active in defence experience difficulty accessing financing. And 68% of companies refrained from seeking equity capital and 44% from bank loans, between 2021 and 2022.