How France's push to exclude the UK from the EU's €150 billion SAFE defense fund backfired, costing Paris €1.1 billion

What happened: France's plan to shut out the UK

France backed tough eligibility criteria for SAFE, a fund launched in May 2025 to raise €150 billion in EU-backed loans for collaborative European defense projects. The core rule France pushed for required that at least 65% of a project's value originate from EU member states, Norway, or Ukraine, limiting content from third countries (including the UK) to 35%.

These rules were widely seen as a deliberate barrier for British firms, according to multiple reports citing the Financial Times. France argued that the fund should incentivize governments to "buy European" rather than direct money to U.K. production lines.

The UK's separate negotiations to join SAFE had already collapsed in November 2025. London declined to meet the multi-billion-euro entry fee demanded by the EU — initially reported as high as €6.5 billion — and the talks failed.

How it backfired: France loses €1.1 billion of its own loans

France subsequently submitted loan requests totaling €16.2 billion from the SAFE fund for a range of defense projects, including several involving joint production with the UK. The European Commission approved only €15.1 billion, leaving a shortfall of approximately €1.1 billion.

Three people familiar with the matter told the Financial Times that the gap occurred because some UK-linked projects failed to meet the strict qualification criteria that France itself had pushed for.

Key projects disqualified

• MBDA projects: The Franco-British missile manufacturer's joint production lines were among those ruled ineligible. MBDA's UK-based operations counted against eligibility under SAFE's rules, limiting the program's ability to fund the company's cross-Channel work.
• Storm Shadow/SCALP cruise missiles: Projects linked to the production of these long-range missiles, already supplied by the UK and France to Ukraine, were also affected. MBDA is the maker of Storm Shadow/SCALP, and its joint development and production involve both British and French facilities.

The chain of cause and effect

Bottom line: a strategic own-goal

France pushed for hardline eligibility rules to keep UK defense firms at arm's length from EU-backed defense spending. But the same rules trapped France's own interconnected projects. Because so many French defense programs rely on British partners and components — especially in missile production through MBDA — the restrictions disqualified precisely the kind of collaborative work Paris had planned to fund. The net result: France lost access to roughly €1.1 billion of its own low-interest loans, leaving it unable to finance several planned Franco-British weapons projects.