Canada has officially joined the European Union’s flagship rearmament initiative, known as the Security Action for Europe (SAFE). This milestone makes Canada the first non-EU nation to participate in the €150 billion program, which is designed to enhance military readiness through joint procurement financing. Prime Minister Mark Carney announced the agreement this week, emphasizing its potential to unlock significant defense opportunities for Canadian businesses.
“Participation in SAFE will unlock billions of dollars in potential defense opportunities for Canadian businesses, attract new reliable suppliers for our Armed Forces, and open massive new opportunities for national manufacturers to build and export Canadian-made capabilities,” Carney stated.
Implications for Canadian Defense Procurement
As Canada embarks on reviewing its next-generation fighter jet procurement, the SAFE program could provide vital support. The country has already allocated funds for 16 initial F-35 fighter jets but is contemplating a mixed fleet that may include the Swedish-made Gripen aircraft as a key contender.
Details regarding Canada’s specific involvement in the SAFE program remain to be finalized. Currently, Ottawa and the EU are negotiating a bilateral agreement that aims to streamline processes and potentially exempt Canada from certain restrictions. Under the current SAFE regulations, no more than 35% of a project’s component costs can come from outside the EU, the European Economic Area, or Ukraine to qualify for funding.
Negotiations surrounding financial contributions have previously complicated similar discussions. For instance, the United Kingdom recently stalled its application due to disagreements over financial commitment sizes, with the EU proposing amounts between €4 billion and €6.5 billion, while the UK was prepared to contribute only around €200 million to €300 million.
Future Defense Projects and Partnerships
Given its ambitious procurement goals, Canada may leverage SAFE funding for a range of projects, including next-generation fighter aircraft, conventional submarines, and maritime domain awareness systems. According to Roger Hilton, a Canadian defense fellow at the think tank GLOBSEC, Canada is also likely to explore SAFE options for drones, anti-submarine warfare platforms, and secure satellite communications.
Collaboration is central to SAFE-funded projects, which require participation from at least two partners—typically two EU member states, or one member state and Ukraine or an EFTA/EEA nation. Hilton anticipates that Canada will seek partnerships with European countries that share common strategic priorities, particularly concerning Arctic security and North Atlantic defense.
“It is very probable that it will also gravitate towards states with the deepest aerospace and naval industries—most notably France, Germany, Italy, Sweden, and Spain,” Hilton noted. These nations possess the industrial capacity, design authority, and collaborative frameworks that align with SAFE’s objectives.
As negotiations progress, the full extent of Canada’s involvement and the specific financial contributions it will make to the SAFE program will be crucial in shaping its defense landscape.
