EU Bonds of 70 Billion in the Second Half of 2025, What Will They Be Used For?

The European Commission has announced that it will issue up to € 70 billion in EU bonds in the second half of 2025.

The annual collection target of around 160 billion euros is thus confirmed. The resources will be used to finance a series of strategic programmes, including NextGenerationEu , support for Ukraine , the new instrument for the Western Balkans and various macro-financial assistance programmes for third countries.

Towards the issuance of EU bonds

The announcement is part of the unified financing model adopted by the European Commission from 2023, which provides for six-monthly financing plans and a single label, namely “EU Bonds”, thus overcoming separate issuances for individual instruments. The approach, it is explained, is aimed at ensuring greater transparency, consistency and liquidity in secondary markets.

So far, the EU has already raised over € 304 billion in grants and loans for Member States through the Recovery and Resilience Facility. This is in addition to €74 billion for other programmes, including assistance to Ukraine, which will receive up to €33 billion by 2027.

There is no shortage of attention to the ecological transition , with the European Commission continuing to issue NextGenerationEu green bonds , which have already raised €75 billion to finance climate-related projects. New issuances will however depend on timely reporting of environmental spending by Member States.

The plan for a common European defence is underway

On the strategic level, at the end of May, Member States adopted the new instrument SAFE (Security and Assistance Facility for Europe), which will use the capital market to raise up to €150 billion by 2030. These resources will be used to finance the acquisition of military capabilities , as the EU seeks greater strategic autonomy. Funding will start in 2026, following the approval of national plans.

The Commission continues to strengthen the Union's financial infrastructure. After introducing repo (repurchase agreement) operations to manage liquidity in 2024, non-competitive auctions will be introduced to broaden the investor base. In parallel, an incentive system has been created for primary dealers offering electronic quotes on EU bonds, with the aim of supporting liquidity and making European bonds a reliable benchmark globally.

What changes for Europe

The ambitious issuance plan planned for 2025 intends to confirm the centrality of common debt as an EU policy instrument, marking a further step towards fiscal integration. While on the one hand this strengthens the Union's ability to respond to crises and strategic investments , on the other it raises political and legal questions about the governance of such debt . Issuing common debt certainly strengthens the EU, because it allows it to raise resources quickly and massively to address crises (such as the recent Covid pandemic or the war in Ukraine ) or finance strategic investments (such as the green transition or the major European rearmament plan).

Open questions on EU debt

But three questions remain on the table. Who decides how to use those funds? Today the Commission does it, but with the increase in common debt, broader governance may be needed. Who is responsible in the event of insolvency ? Currently the debt is guaranteed by the EU budget, but there is no real fiscal union. Is the debt sustainable in the long term? If it becomes structural, it will have to be regulated in a stable way. In this case, obstructionism by the so-called "frugal countries" can already be foreseen.