00:00Did the EU charge the UK billions more than Canada to join its defense loan agreement?
00:09Canada recently signed up to the EU's Security Action for Europe agreement, or SAFE,
00:14becoming the first non-European member state to do so.
00:17Yet, the news has caused frustration across the channel.
00:20Posts on X suggest that while the EU asked the UK for up to 6 billion euros to join,
00:25which it ultimately refused, Brussels only requested 10 million euros from Canada,
00:31prompting some to accuse the EU of offering the UK a rough deal.
00:35SAFE is a 150 billion EU-backed loan scheme that helps member states to borrow money
00:40and buy defense equipment more quickly.
00:43But non-EU states are allowed to join if they negotiate access with Brussels.
00:47In the case of Canada, the European Commission confirmed to the Cube
00:51that Ottawa will pay an initial 10 million euros to participate.
00:54Meanwhile, the 6 billion euro price tag offered to the UK has not been officially announced,
01:00but it has been reported elsewhere despite a lack of evidence.
01:03A country is offered a fee based on the economic and commercial benefits
01:08a country's defense industry would gain from participating.
01:11So, the more defense contracts a country's companies are likely to win under the scheme,
01:15the higher the cost will be.
01:17The UK is one of Europe's largest defense industries with deep integration in Europe's supply chains,
01:22while Canada's defense sector is considerably smaller and less embedded in European procurement networks.
01:28But the negotiation between the EU and UK broke down in late 2025,
01:33reportedly after Keil Starmer's government said that even a reduced offer of 2 billion euros to June was too high.
01:39In early February, Starmer said the UK could apply to join a second multi-billion euro EU defense fund,
01:45ahead of talks with EU counterparts.
01:48.
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