Europe’s next-generation defence: a blueprint for strategic autonomy

Hélène Rey, Vice President of the Centre for Economic Policy Research and Lord Bagri Professor of Economics at London Business School, together with Philipp Hildebrand, Vice Chairman of BlackRock, and Moritz Schularick, President of the Kiel Institute for the World Economy and Professor of Economics at Sciences Po and Universität Bonn, have outlined a bold proposal for strengthening European defence capabilities in the face of shifting US commitments, external threats, and global competition.

In their recent VoxEU column, the authors argue that Europe must urgently develop a European Future of Defence Architecture, focusing on next-generation technologies such as AI, quantum computing, satellite constellations, drones, and dual-use infrastructure. Central to their proposal is joint procurement, long-term investment, and industrial capacity building across a coalition of willing EU countries, dubbed the “European Team.” Governance would be managed through expert-led steering committees, drawing inspiration from DARPA, with clear multi-year priorities, resource allocation, and quality control.

Financing is envisioned through European Future of Defence Bonds with sovereign status, enabling front-loaded investment while mitigating fiscal constraints on individual states. The authors stress the importance of establishing a robust legal and institutional framework, potentially leveraging the European Stability Mechanism or a new dedicated agency, to ensure efficiency, credibility, and market appeal. A phased approach is recommended, beginning with a subset of countries prepared to act quickly, with the framework open to additional participants over time.

The proposal has already drawn recognition from leading commentators. Martin Wolf acknowledged the work in his latest Financial Times piece on US policy toward Europe, highlighting its relevance as Europe faces both internal and external strategic challenges.

For further reading:

European defence governance and financing, VoxEU, 20 November 2025

Trump’s war on Europe, FT, 16 November 2025