EU's 800 billion euro plan: rearmament of Europe or hidden money laundering machine?
Brussels, March 6, 2025 - EU Commission President Ursula von der Leyen has caused a sensation with her ambitious "ReArm Europe" plan: 800 billion euros are to be mobilized to strengthen Europe's defense capabilities and at the same time boost the Ukrainian arms industry. Officially, the program is being sold as a response to geopolitical uncertainty and the US withdrawal from support for Ukraine. But behind the scenes, there are whispers in political circles: is the whole thing just a cleverly disguised money laundering machine that diverts public funds into private pockets? As a political reporter, I take a look at the mechanisms that could drive this plan.
The plan: an overview
The five-point plan envisages loosening European debt rules, increasing national defense spending and integrating private investment and EU funds - for example through the European Investment Bank. The aim is to raise up to 800 billion euros, a significant portion of which will go to the defense industry, including investments in Ukraine. Von der Leyen stresses that this is necessary to secure Europe in an "era of rearmament" and to make Ukraine less dependent on US arms deliveries. But how does this work financially - and where could the weak points be?
The money laundering machine: a hypothetical scenario
Critics - including some EU parliamentarians and independent economists - see the plan less as a defense strategy than as a gigantic redistribution program. The way such a "money laundering machine" works could look like this:
Flow of money from public coffers: EU countries pump taxpayers' money into the plan, either through direct budget funds or by relaxing debt rules, which allows states to take on more debt. In addition, unused regional development funds (cohesion funds) are to be diverted - money that was originally intended for social projects.
Intermediate stop: arms industry: These funds are passed on to large arms companies in the EU and to Ukrainian producers. Contracts for air defense systems, drones or ammunition are awarded, often to companies with good connections to political decision-makers. The Ukrainian arms industry, which has massively increased its production since the start of the war, could serve as the perfect recipient here - not least because the structures there are less transparent and more difficult to verify.
Return flow via subcontractors and consultants: Some of the money could flow back into the pockets of insiders via complex networks of subcontractors, consulting firms and offshore accounts. Non-transparent tendering procedures and a lack of control - for example by the EU anti-corruption agency OLAF - could encourage this. One example: a contract for missile production is awarded to a consortium, which in turn commissions subsidiaries in tax havens that issue excessive invoices.
Legitimation through geopolitical crisis: The war in Ukraine serves as a moral and political cover. Anyone who voices criticism is quickly labelled as anti-security or pro-Russian. This stifles public debate while the money flows unhindered.
The role of Ukraine
The Ukrainian arms industry is a central component of the plan. According to internal EU documents, it could benefit from direct investments worth billions, for example for the production of drones and missiles. But this is precisely where the risk lies: the Ukrainian economy is war-torn, and corruption is a known problem. If EU funds flow there on a large scale without strict control mechanisms in place, some of them could simply “leak away” – either through mismanagement or deliberate diversion.
Political support and resistance
