Cyprus Gets €1.18 Billion Loan to Boost Defence Industry

Summary

The European Commission and the Council have decided to give Cyprus financial help under the Security Action for Europe (SAFE) programme, which supports the European defence industry.

• Background

• In May 2025 the EU introduced Regulation (EU) 2025/1106, creating the SAFE instrument.

• The Commission invited member states to apply for loans, and 19 states expressed interest by 29 August 2025.

• On 28 November 2025 Cyprus submitted a request and a defence‑industry investment plan.

• The Commission reviewed the request and found it meets all the conditions of the regulation, including that the planned projects will use common or single procurement and will improve defence production and interoperability.

• Decision

• Article 1 – Cyprus’s request satisfies the regulation’s requirements.

• Article 2 – The EU will provide Cyprus with a loan of up to EUR 1 181 503 924,00.

• A pre‑financing payment of EUR 177 225 588,60 will be made immediately.

• The decision is subject to other EU rules on solidarity, proportionality, and financial protection.

• Article 3 – The decision is addressed to the Republic of Cyprus.

The loan will help Cyprus strengthen its defence industry and meet the objectives of the SAFE programme.