ATHENS — Greece said today it would deploy a Patriot missile defense system and troops to bolster Bulgaria’s defense capabilities against possible aerial attacks. Greek Defense Minister Nikos Dendias said a Patriot battery ⁠will be moved to northern Greece to cover a large part ‌of Bulgaria, which lies in range of Iranian missiles. In addition, two Greek F16 fighter jets will ‌also be stationed in northern Greece for additional protection for ⁠Bulgaria, while senior Greek air force officers ‌will be sent to ‌Sofia ⁠to ⁠help with coordination. “The above actions were taken at the request of Bulgaria, a member state of NATO and the EU, and do not in any way affect the ability to provide anti-ballistic protection for Greek territory,” Dendias said in a statement. Earlier this week, Greece deployed two frigates and four of F-16 fighter jets to Cyprus following Iranian drone incursions on the Mediterranean island. Since the U.S.-Israeli attack on Iran, Athens also transferred a Patriot battery to the island of Karpathos in the southeastern Aegean Sea as part of the country’s efforts to boost its defense.

Listen on * Spotify * Apple Music * Amazon Music Der Iran-Krieg droht auch die deutsche Wirtschaft mit voller Wucht zu erreichen. Die Preise für Energie und Logistik gehen nach oben, und die Politik in Berlin muss sich fragen: Wie resilient ist der Standort gegen diesen neuen globalen Schock? Joana Lehner und Jürgen Klöckner analysieren, welche Krisenmechanismen jetzt wirklich greifen und warum das neue Heizungsgesetz der Bundesregierung plötzlich zum geopolitischen Risiko wird. Im Policy Talk spricht Martin Kröger, Hauptgeschäftsführer des Verbandes Deutscher Reeder, über die dramatische Lage in der Straße von Hormus. Seit Beginn der Offensive ist die wichtigste Meerenge der Welt faktisch unpassierbar. Kröger erklärt, warum deutsche Schiffe im Persischen Golf festsitzen, wie die Versorgung der Crews gesichert wird und warum staatliche Versicherungsgarantien, wie sie von Donald Trump ins Spiel gebracht wurden, allein keine Lösung für ein mögliches globales Logistik-Chaos sind. Außerdem ist Romanus Otte vom „⁠POLITICO Pro“-Newsletter „Industrie und Handel“⁠ zu Gast in „Off the Record“. Er hat Wirtschaftsministerin Katherina Reiche bei Veranstaltungen in Halle und München beobachtet. Romanus ordnet ein, wie sich Reiche beim Krisenmanagement schlägt, warum sie dabei ihre Komfortzone verlassen muss und wie ihr Auftreten insgesamt bei Vertretern aus Industrie und Handwerk ankommt. „Power & Policy“ zeigt jede Woche, wo und wie die Entscheidungen in der Wirtschaftspolitik fallen. ⁠Jürgen Klöckner⁠ und ⁠Joana Lehner⁠ von POLITICO sprechen mit Top-Entscheidern und liefern Off-the-Record-Einblicke aus der Redaktion und Machtzentren. Präzise Analysen, lange bevor Gesetze beschlossen sind. Der Podcast für alle in Wirtschaft und Politik, die einen Wissensvorsprung brauchen — immer donnerstags. Für Policy-Profis: Abonnieren und die Pro-Newsletter ⁠Industrie & Handel⁠, ⁠Energie & Klima ⁠und ⁠Gesundheit⁠. Jetzt kostenlos testen. Fragen und Feedback gern an ⁠powerandpolicy@politico.eu⁠ **(Anzeige) Eine Nachricht von Fuchs & Cie.: Bei Fuchs & Cie. zählen Leistung und Erfolg. Im Interesse unserer Klienten und ihrer Themen. Deswegen jetzt bewerben. Gerne mit einem Hintergrund aus den Bereichen Defence, Finance, Data oder Energy. Bewerbung per Mail an karriere@fuchs-cie.de. Wir verstärken unsere Teams in Berlin, München und Frankfurt.** POLITICO Deutschland – ein Angebot der Axel Springer Deutschland GmbH Axel-Springer-Straße 65, 10888 Berlin Tel: +49 (30) 2591 0 ⁠information@axelspringer.de⁠ Sitz: Amtsgericht Berlin-Charlottenburg, HRB 196159 B USt-IdNr: DE 214 852 390 Geschäftsführer: Carolin Hulshoff Pol, Mathias Sanchez Luna

The Trump administration is considering providing military protection to oil and gas tankers traversing the Strait of Hormuz in a bid to cool energy prices that have surged since Iran warned it would attack ships at the choke point, two people said Tuesday. “Military support for oil and gas supplies,” a person familiar with the discussion who was granted anonymity to discuss internal conversations said when asked about the potential for U.S. naval vessels to escort ships traveling through the strait. “It’s becoming a growing concern that the energy markets could face pressures in the coming days as the military campaign intensifies and expands in geographic scope. Access to the Straits of Hormuz is obviously vital for both natural gas and crude oil shipments, especially from Qatar and Saudi.” U.S. oil prices have risen nearly $10 per barrel since the end of last week as the fighting has continued. That increase has started to filter down to gasoline prices, which are poised to climb higher than when President Donald Trump took office last year. The administration is also considering potentially having the U.S. government back the insurance needed for tankers to continue traveling through the strait, said a third person familiar with the discussions. While the strait remains technically open, marine insurance companies are hiking rates and in some cases canceling coverage for tankers that traverse the area. A former defense official familiar with the talks said the Pentagon is having ongoing discussions about a maritime mission that would closely resemble previous Defense Department operations in the Red Sea, where the U.S. deployed carriers and destroyers to the region in attempts to preserve freedom of navigation amid threats from an Iran-linked group. “The President is meeting with his Energy and Treasury secretaries today, and they will have more to share after the meeting,” a White House spokesperson said when asked about the options being discussed. The talks are the first sign Trump is starting to take seriously the surge in oil, natural gas and road fuel prices that started after the start of the U.S.-Israeli attacks against Iran on Saturday that killed Iran’s supreme leader and sparked a war in the Middle East. The widening war, which has resulted in six American service members killed and attacks against the U.S. embassy in Saudi Arabia, has made oil and gas facilities a major target for Iran. Qatar shut down a major natural gas export plant, Saudi Arabian fuel refineries have come under attack, and Iran has fired on ships traversing Hormuz, a major thoroughfare for 20 percent of the world’s waterborne oil deliveries. The U.S. military says they have sunk 11 Iranian ships since the start of the joint operation with Israel on Saturday, meaning the mission is likely to focus more on intercepting Tehran’s missiles that could target civilian shipping traffic than deterring maritime incursions. That could put further pressure on U.S. stockpiles of air defense interceptors, which have already been run low from the campaign against Yemen’s Houthis and Israel’s 12-year war against Iran last year. Secretary of State Marco Rubio said Monday that the administration would unveil a plan Tuesday to combat the rise in oil prices triggered by the U.S. military strikes against Iran. He did not divulge what those plans would be, only stating, “We’re going to destroy their Navy.” Felicia Schwartz and Zack Colman contributed to the report.

Elisabeth Braw is a senior fellow at the Atlantic Council, the author of the award-winning book “Goodbye Globalization” and a regular columnist for POLITICO. You may have heard that some unsavory ships have been navigating our waters, smuggling drugs and other goods, damaging underwater infrastructure and sometimes just lurking, perhaps conducting surveillance. Many of these ships turn up in Irish waters, which are home to multiple undersea cables. But while Ireland has a tiny navy to deal with these unwanted visitors, it does have another formidable resource that helps keep its waters safe: its fishermen. And for the sake of national security, let’s hope this shrinking tribe manages to renew its ranks. In January 2022, Ireland was facing a terrible dilemma: The Russian Navy had just announced it was going to hold an exercise in Irish waters. Conducting wargames in the exclusive economic zones of other countries is legal, but guests ordinarily ask for permission — and Russia definitely wasn’t a welcome visitor. Like the rest of Europe, Ireland was gripped with fear that Russia was about to invade Ukraine and perhaps other countries. Dublin politely asked the Russian Navy to refrain from holding its exercises, but to no avail. The wargames were going to take place. But then the Irish government received assistance from an unexpected source. The country’s fishermen declared they wouldn’t allow the exercise to happen: “This is the livelihoods of fishermen and fishing families all around the coastline here,” announced Patrick Murphy, chief executive of the Irish South and West Fish Producers Organisation, on RTE radio. “It’s our waters. Can you imagine if the Russians were applying to go onto the mainland of Ireland to go launching rockets, how far would they get with that?” The fishermen, Murphy explained, would take turns fishing around the clock. The maneuver made it impossible for the Russians to perform their exercises, and Moscow ended up cancelling the wargames. The creativity of these gutsy fishermen made global news, but away from the headlines, they and their colleagues in other countries have long been aiding national security. In the early hours of Oct. 28, 1981, two Swedish fishermen on their daily round off the coast of Karlskrona noticed something unusual. They decided to alert the authorities, and the navy dispatched a vessel. What the fishermen had spotted turned out to be the U137 — a Soviet nuclear submarine that had run aground. The incident demonstrated several things: First, fishermen know their countries’ waters like almost no one else and notice when something is out of the ordinary. Second, the navy — or the coast guard — can’t be everywhere all the time. And third, fishermen can perform a vital service to national security by alerting authorities when something doesn’t look right. The grounded U137 wasn’t a one-off. In fact, fishermen keep a vigilant eye on their surroundings on behalf of their compatriots all the time. Stefano Guidi/Getty Image Ireland’s large number of undersea cables is the result of the country’s strategic location at the westernmost end of the north Atlantic and its need for top-notch connectivity to service its high-tech economy. Indeed, the republic has marketed its connectivity — and low corporate taxes — so successfully that a host of U.S. tech firms and other corporate giants have set up European hubs there. But its waters cover a vast 880,00 square kilometers. That’s a challenge for the Irish Naval Service, which has a small fleet of eight patrol vessels, and such a shortage of sailors that it can’t even crew those few vessels. Despite placing a few orders for maritime equipment recently, it’s in no position to detect all the suspicious activity taking place in Ireland’s waters. That’s where the fishermen come in. Because they spend so much time at sea — some 200 days in the average year — they are adept at spotting drug boats or, say, potential saboteurs. When the authorities detect something unusual, perhaps via radar, they often ask fishermen what they’ve seen. “People ring us up and say: ‘Did you notice ABC?’,” Murphy told me. “Then we send them pictures. A lot of fellas send in pictures and tracking. WhatsApp is very good for this.” This monitoring, Murphy said, isn’t just a phenomenal alert system. “It’s a deterrent.” We’ll never know how many unwelcome visitors that vigilance has deterred. But in keeping their eyes open, fishermen perform an indispensable service to Irish security — and it costs the government nothing. As unwanted visitors keep turning up in our waters, such contributions to national security are becoming increasingly essential all around Europe. There’s just one problem: The fishing profession is losing manpower. In Ireland, the fishing fleet has shrunk from some 400 vessels to just over 100 in the past two decades due to economics, foreign competition, fishing quotas and maritime regulations. From a security perspective, this continued decline of Irish — and European — fishermen is dangerous. They’re the best soldiers we never knew we had.

DUBLIN — Neutral and poorly armed Ireland — long viewed as “Europe’s blind spot” — announced Thursday it will spend €1.7 billion on improved military equipment, capabilities and facilities to deter drones and potential Russian sabotage of undersea cables. The five-year plan, published as Defense Minister Helen McEntee visited the Curragh army base near Dublin,  aims in part to reassure European allies that their leaders will be safe from attack when Ireland — a non-NATO member largely dependent on neighboring Britain for its security — hosts key EU summits in the second half of next year. McEntee said Ireland intends to buy and deploy €19 million in counter-drone technology “as soon as possible, not least because of the upcoming European presidency.” Ireland’s higher military spending — representing a 55 percent increase from previous commitments — comes barely a week after a visit by Ukrainian President Volodymyr Zelenskyy exposed Ireland’s inability to secure its own seas and skies. Five unmarked drones buzzed an Irish naval vessel supposed to be guarding the flight path of Zelenskyy’s plane shortly after the Ukrainian leader touched down at Dublin Airport. The Irish ship didn’t fire at the drones, which eventually disappeared. Irish authorities have been unable to identify their source, but suspect that they were operated from an unidentified ship later spotted in European Space Agency satellite footage. The Russian embassy in Dublin denied any involvement. Ireland’s navy has just eight ships, but sufficient crews to operate only two at a time, even though the country has vast territorial waters containing critical undersea infrastructure and pipelines that supply three-fourths of Ireland’s natural gas. The country has no fighter jets and no military-grade radar and sonar. Some but not all of those critical gaps will be plugged by 2028, McEntee pledged. She said Ireland would roll out military-grade radar starting next year, buy sonar systems for the navy, and acquire up to a dozen helicopters, including four already ordered from Airbus. The army would upgrade its Swiss-made fleet of 80 Piranha III armored vehicles and develop drone and anti-drone units. The air force’s fixed-wing aircraft will be replaced by 2030 — probably by what would be Ireland’s first wing of combat fighters. Thursday’s announcement coincided with publication of an independent assessment of Ireland’s rising security vulnerabilities on land, sea and air. The report, coauthored by the Dublin-based think tank IIEA and analysts at Deloitte, found that U.S. multinationals operating in Ireland were at risk of cyberattacks and espionage by Russian, Chinese and Indian intelligence agents operating in the country.

Eoin Drea is senior research officer at the Wilfried Martens Centre for European Studies. Catherine Connolly’s election as Ireland’s next president highlights just how delusional the country has become when it comes to security. It should also serve as a wake-up call for other EU members in terms of the country’s unreliability on defense issues. Opposing Germany’s rearmament on the basis that it represents a “revitalization” of its “military industrial base” isn’t even Connolly’s most extreme position. To her, Berlin’s current spending plans are reminiscent of the military build-up in the 1930s. She’s critical of NATO, voted no to the Lisbon and Nice treaties in Irish referenda and has called Hamas “part of the fabric of the Palestinian people.” Yet, she romped home with nearly 65 percent of the vote. That’s because Connolly’s views aren’t fringe or some populist narrative — they actually represent mainstream political sentiment on the Emerald Isle. As the EU starts focusing on rearmament, Ireland’s traveling in the exact opposite direction. Even with war raging in Ukraine, America’s growing unpredictability and Russia probing undersea infrastructure in Irish waters, Dublin’s political culture remains mired in myths of neutrality and moral exceptionalism — and it is refusing to budge. This approach is no longer credible in Brussels. And it’s why only a defense union with Britain can save Ireland now. Despite bumper budget surpluses underpinned by surging receipts from U.S. tech and pharma companies, Ireland is refusing to spend more on its armed forces. The country’s defense spending has barely risen above inflation since 2022. It’s capital budget for defense stands at a paltry €300 million for 2026 — and this is in an EU country with no fighter jets, navy ships with sporadically working guns and only enough sailors to send a single vessel on patrol per day. Dublin has demonstrably failed to seize the geopolitical moment, and is instead being scarily naïve. And given the circumstances, only a formal bilateral agreement with the U.K. can deliver the territorial security that Ireland — and the EU’s western borders — desperately needs. This is realpolitik, not Celtic sentimentality. The case for a defense union rests on two inconvenient but undeniable truths. First, geography — not history — is destiny. Ireland and Britain share an island archipelago, as well as a free travel area. Despite Brexit, there remains no physical border between Southern and Northern Ireland. And the country has long prioritized maintaining its common travel zone with Britain over potentially joining the EU’s Schengen area. The current reality is that British jets already respond to threats in Irish airspace with the Irish government’s approval, and it’s the British Navy that hunts Russian threats in Irish waters. But Irish sovereignty would be better protected through structured partnership — one along the lines of the Belgian and Dutch naval forces — than through the kind of cheapskate dependence that currently exists. Second, the U.K. has what Ireland simply refuses to provide: fighters, frigates, satellites, cyber infrastructure and institutional depth. France and Germany lack both proximity and capability to consistently patrol the Irish Sea and North Atlantic. Continental European forces can’t scramble from nearby airfields or deploy from Ireland-adjacent ports on short notice. Catherine Connolly romped home with nearly 65 percent of the vote. | Niall Carson/PA Images via Getty Images The framework I’m talking about is rather simple: Joint Anglo-Irish responsibility for air policing and maritime surveillance in Irish zones, with Irish participation in joint command, training and procurement mechanisms. Ireland would also invest in complementary capabilities like patrol vessels, intelligence, cyber defense and infrastructure protection. And no Ireland-based British bases would be necessary; forward deployment and joint operation centers would suffice. Speaking more broadly, a formal Anglo-Irish agreement would also embed Britain in EU defense policy. A key objective in Brussels, considering the ongoing war in Ukraine and the uncertainty over future U.S. support. Such a union would intertwine the security objectives of London, Washington and the EU, and could also be narrowly tailored to placate the perennially disgruntled French. No foreign adventures. No NATO. Just credible security capabilities in Irish waters and skies. Ireland has long prided itself on being one of Europe’s most globalized economies. It hosts U.S. tech and pharma giants, and its economy is fueled by their corporate taxes. Dublin depends on free trade and stable institutions. Yet, the same political class celebrating such openness to global capital demands insularity when it comes to security. The cognitive dissonance is staggering. How can one host Apple, Google, and Pfizer while playing neutral on defense? Of course, opposition will undoubtedly come from the “1916 Brigade,” who worship neutrality as doctrine rather than policy, and see any British security cooperation as treasonable. But this position is neither principled nor rational. The 1916 Brigade dreams of Western prosperity without Western security obligations — that is not neutrality. It is nativism wrapped in nationalist mythology. Austria — the neutrality model some invoke — spends about three times Ireland’s defense percentage and maintains real military capability. Simply put, Ireland’s military helplessness has been subsidized by British and NATO-member taxpayers for far too long. It’s time for the country to focus on the present, not the past.

BERLIN — Friedrich Merz said the quiet part out loud back in May: Germany intends to build the Bundeswehr into “the strongest conventional army in Europe,” pledging to give it “all the financial resources it needs.” Five months later, the German chancellor aims to add the hardware to that ambition, according to new internal government documents seen by POLITICO.  The sprawling 39-page list lays out €377 billion in desired buys across land, air, sea, space and cyber. The document is a planning overview of arms purchases that will be spelled out in the German military’s 2026 budget, but many are longer-term purchases for which there is no clear time frame. Taken together, it’s a comprehensive roadmap for Germany’s long-overdue defense overhaul, anchored firmly in domestic industry. Politically, the timing tracks with Merz’s shift to a new financing model. Since the spring, Berlin has moved to carve out defense from Germany’s constitutional debt brake, allowing sustained multiyear spending beyond the nearly exhausted €100 billion special fund set up under former Chancellor Olaf Scholz’s tenure. Items on the list will eventually appear, in smaller tranches, when they’re mature enough for a parliamentary budget committee vote. All procurements valued over €25 million need the committee’s sign-off. HUNDREDS OF BILLIONS The documents show that the Bundeswehr wants to launch about 320 new weapons and equipment projects over the next year’s budget cycle. Of those, 178 have a listed contractor. The rest remain “still open,” showing that much of the Bundeswehr’s modernization plan is still on the drawing board. German companies dominate the identifiable tenders with around 160 projects, worth about €182 billion, tied to domestic firms.  Rheinmetall is by far the biggest winner. The Düsseldorf-based group and its affiliated ventures appear in 53 separate planning lines worth more than €88 billion. Around €32 billion would flow directly to Rheinmetall, while another €56 billion is linked to subsidiaries and joint ventures, such as the Puma and Boxer fighting vehicle programs run with KNDS. The document foresees a total of 687 Pumas, including 662 combat versions and 25 driver-training vehicles, to be delivered by 2035. Rheinmetall is by far the biggest winner. | Hannibal Hanschke/EPA In air defense, the Bundeswehr aims to procure 561 Skyranger 30 short-range turret systems for counter-drone and short-range protection — a program fully under Rheinmetall’s lead. Along with that come grenades and rifle rounds in the millions. Diehl Defence emerges as the Bundeswehr’s second major industrial anchor after Rheinmetall. The Bavarian missile manufacturer appears in 21 procurement lines worth €17.3 billion. The largest share comes from the IRIS-T family, which is set to form the backbone of Germany’s future air defense architecture. According to the document, the Bundeswehr aims to buy 14 complete IRIS-T SLM systems valued at €3.18 billion, 396 IRIS-T SLM missiles for about €694 million and another 300 IRIS-T LFK short-range missiles worth €300 million. Together, these lines alone amount to around €4.2 billion — making IRIS-T one of the most significant single air defense programs in the Bundeswehr’s planning. Drones are also gaining ground on the military wish list.  On the higher end, the Bundeswehr wants to expand its armed Heron TP fleet operated with Israel’s IAI, aiming to buy new munitions for around €100 million. A dozen new LUNA NG tactical drones follow at about €1.6 billion. For the navy, four uMAWS maritime drones appear in the plan for an estimated €675 million, which will include replacement parts, training and maintenance. Several of the Bundeswehr’s most expensive new projects sit not on land, sea or in the air — but in orbit. The list includes more than €14 billion in satellite programs, calling for new geostationary communications satellites, upgraded ground control stations and, most ambitiously, a low-Earth-orbit satellite constellation worth €9.5 billion to ensure constant, jam-resistant connectivity for troops and command posts. The push aligns with Defense Minister Boris Pistorius’ €35 billion plan to boost Germany’s “space security.” KEEPING THE CASH AT HOME One of the most politically charged plans on the Bundeswehr’s wish list is the potential top-up of 15 F-35 jets from Lockheed Martin, worth about €2.5 billion under the U.S. Foreign Military Sales system.  These would keep Germany’s nuclear-sharing role intact but also retain its reliance on American maintenance, software and mission-data access. It could also signal a further German convergence on American weaponry it cannot replace, just as political tensions deepen over the Franco-German-Spanish sixth-generation fighter jet, the Future Combat Air System. The same U.S. framework appears across other high-profile projects.  The Bundeswehr plans to buy 400 Tomahawk Block Vb cruise missiles for roughly €1.15 billion, along with three Lockheed Martin Typhon launchers valued at €220 million — a combination that would give Germany a 2,000-kilometer strike reach.  The navy’s interim maritime-patrol aircraft plan, worth €1.8 billion for four Boeing P-8A Poseidons, also sits within the foreign military sales pipeline. One of the most politically charged plans on the Bundeswehr’s wish list is the potential top-up of 15 F-35 jets from Lockheed Martin. | Kevin Carter/Getty Images All three tie Berlin’s future strike and surveillance capabilities to U.S. export and sustainment control. Together, about 25 foreign-linked projects worth roughly €14 billion appear clearly in the Bundeswehr’s internal planning — less than 5 percent of the total €377 billion in requested spending.  Yet they account for nearly all of Germany’s strategic, nuclear-related and long-range capabilities, from nuclear-certified aircraft to deep-strike and maritime surveillance systems. By contrast, nearly half of the list is anchored in German industry, spanning armored vehicles, sensors and ammunition lines. In financial terms, domestic firms dominate; politically, however, the few foreign systems define the country’s most sensitive military roles.

BRUSSELS — As Beijing further weaponizes its control over the flow of minerals that Western countries need for their green, defense and digital ambitions, Europe has to face an uncomfortable truth: It won’t escape China’s dominance anytime soon. The Chinese government’s shock imposition earlier in October of sweeping export controls on rare-earth magnets and the raw materials needed to make them has escalated a running trade feud with the United States. The embargo threatens vast — and rapid — collateral damage on the European Union and has forced its way onto the agenda of a high-level summit on Thursday. “A crisis in the supply of critical raw materials is no longer a distant risk. It is on our doorstep,” European Commission President Ursula von der Leyen said in a pre-summit speech to European lawmakers. “Now, we must accelerate decisively and urgently. We need faster, more reliable supply of critical raw materials, both here in Europe and with trusted partners. I will be ready to propose further measures to ensure Europe’s economic security and I will accelerate what we have already put in motion.” Beijing’s announcement this month drew a fierce rebuke from U.S. President Donald Trump, who threatened to hike tariffs on Chinese goods to 100 percent. Trump is due to hold a high-stakes meeting with Chinese President Xi Jinping on the sidelines of an Asia-Pacific summit at the end of October. The EU, which imports nearly all of its rare earths and permanent magnets from the Middle Kingdom, is caught in the crossfire. “We have no interest in escalation,” Maroš Šefčovič, the EU’s trade chief, told reporters Tuesday. “However, this situation casts a shadow over our relationship. Therefore, a prompt resolution is essential.” China and the EU will “intensify contacts at all levels” on the issue, Šefčovič added. Wang Wentao, the Chinese trade minister, has accepted an invitation to come to Brussels in the coming days to discuss the restrictions, Šefčovič said after a two-hour call between the two. The EU is also consulting with the G7 group of industrialized nations on a coordinated response on critical minerals ahead of an Oct. 30-31 ministerial meeting in Canada. Yet, behind the talk of adequate diplomatic responses and potential retaliation there is no escaping the dominance in rare earths that China has built up over decades. For now at least. “In the short term there’s nothing you can do, except try and negotiate with the Chinese,” said Philip Andrews-Speed, senior research fellow at the Oxford Institute for Energy Studies.  HIT WHERE IT HURTS Beijing dominates the entire supply chain of rare earths — a group of 17 minerals used in permanent magnets found in everything from electric vehicles and wind turbines, to F-35 fighter jets and naval vessels. Under its new export controls, importers will need a government license to access not only those permanent magnets, but also the refined metals and alloys that go into them. China already weaponized its leading position in producing and refining critical raw materials — and specifically rare-earth elements like scandium, yttrium and dysprosium — in response to Trump’s first wave of punitive tariffs back in April. Eventually, the White House caved in. This time, again, the Chinese export controls are “a tit-for-tat for U.S. policy,” said a person from the Chinese business sector, granted anonymity to speak candidly. The EU is being hit, too: “The effects are direct and enormous, particularly for the defence sector,” Tobias Gehrke and Janka Oertel of the European Council on Foreign Relations wrote in a commentary. “The EU defence industry risks grinding to a halt as inventory shortfalls could leave it struggling to produce and deliver enough weapons for the war in Ukraine.” China accounts for 61 percent of rare earths extraction and 92 percent of refining, according to the International Energy Agency. It provides nearly 99 percent of the EU’s supply of the 17 rare earths, as well as about 98 percent of its rare earth permanent magnets. UNDERDOG DIPLOMACY  In addition to its minerals monopoly, Beijing has built a legal foundation to capitalize on it — through an export control toolbox that mirrors the one Washington has used to cap exports of leading-edge technology to China. The EU lacks a comparable armory that would allow it to respond in kind. Whereas export controls are now a go-to option in Washington’s and Beijing’s trade negotiation strategies, to Brussels, protecting national security remains the sole legitimate justification to deploy such measures.  “The EU will need to find a way to live in this new reality,” said Antonia Hmaidi, senior analyst at think tank Merics, adding that the bloc may have to give up its belief in the rules-based trading system that characterized the post-World War Two era. “It could also mean that the EU chooses not to play that game, but then the EU needs a different game to play,” she said, adding that weaponizing EU market access could be a powerful alternative. Ahead of Thursday’s summit, calls are growing to ready the EU’s Anti-Coercion Instrument (ACI), the only trade policy tool the EU can wield against economic coercion. Working mostly through deterrence, the bloc’s so-called trade bazooka seeks to prevent foreign powers from pressuring European countries — but only foresees action as a last resort. “It’s the usual sabre rattling from the usual subjects, but activating the ACI is not seriously under consideration at this stage,” said one EU diplomat, who was also granted anonymity. Asked whether the EU executive is looking at the ACI, the Commission’s deputy chief spokesperson Olof Gill said: “Right now we’re focused on engagement, and we’re not going to go down the road of speculating about any other possibility.” That engagement is delivering scant results. In June, Beijing agreed to set up a “green channel” for European companies to speed the approval of export licenses. And yet, Šefčovič said, only half of the 2,000 priority applications submitted by European companies to the Chinese authorities had been “properly addressed.” CATCHING UP  Moving forward, the EU needs to dramatically ramp up its diversification efforts. At a meeting with industry leaders on Monday, Industry Commissioner Stéphane Séjourné said the EU’s response must build on two pillars, according to his cabinet: a diplomatic solution and a more resilient supply chain. China accounts for 61 percent of rare earths extraction and 92 percent of refining, according to the International Energy Agency. | VCG/Gett Images That, however, won’t happen overnight. Especially since the EU executive unveiled its grand plan to diversify its supply of raw materials away from China two years ago, officials have been stressing the need to stockpile more of the metals and minerals, ramp up domestic mining and production and seal new partnerships. But concrete action is still lagging, with experts and industry alike lamenting the lack of funding being put on the table. James Watson, director general at metals lobby Eurometaux, welcomed the EU executive’s decision to award “strategic project” status to some 60 mines and refineries inside and outside the bloc, but added: “We still need dedicated funding for the sector, as well as addressing structural issues, such as higher energy costs and heavier administrative burdens, that put as at a competitive disadvantage compared with our global competitors.” Camille Gijs and Koen Verhelst contributed reporting.

LONDON — The U.K., Canada and the EU are mulling a coordinated response at the G7 level to China’s expansion of export controls on critical minerals at a key meeting at the end of this month. With Canada due to host G7 ministers in Toronto at the end of October, the allies are seeking to accelerate efforts to diversify away from Beijing’s dominance in the rare-earth sector.  This comes after Beijing last week announced new restrictions on foreign access to rare-earth magnets and the refined metals and alloys needed to make them over national security concerns. The move immediately raised alarm from the EU and G7 allies over supply chain security for technologies ranging from electric vehicles and wind turbines, to F-35 fighter jets and naval vessels. China mines about 60 percent and processes about 90 percent of the world’s rare-earth metals.  Ministers from the G7 are “putting our shoulders to the task, buckling down and trying to get as many concrete steps taken as we can to create alternatives for the critical minerals that have been put on export restrictions,” Canadian Energy and Natural Resources Minister Tim Hodgson told POLITICO in an interview Thursday at the end of a three-day trip to London. “We had a meeting with the G7 envoys on critical minerals while I was here, all working towards further development of a coordinated, multilateral approach to dealing with the recent restrictions,” Hodgson said. “We’re working on those as we speak and we’ll hopefully have some announcements by the time we get to the minister’s meeting in Toronto at the end of the month.” The move immediately raised alarm from the EU and G7 allies over supply chain security for technologies ranging from electric vehicles and wind turbines, to F-35 fighter jets and naval vessels. | AFP via Getty Images According to one EU official briefed on the G7 discussions, the Canadians are working on a term sheet of measures to accelerate stockpiling, activate critical mineral partnerships, and build out mining activities in a more concerted approach. EU trade chief Maroš Šefčovič this week urged the G7 to respond jointly. Šefčovič is expected to discuss the matter with Chinese Commerce Minister Wang Wentao early next week.  The European Commission is seeking to foster coordinated measures against Beijing’s curbs, two other Commission officials told POLITICO. One of them said the EU executive would launch a study of the impact of the new bans on EU industry early next week.  “It’s coercion. We need to see how we will respond,” said the other Commission official, who like the others cited in the story was granted anonymity to discuss the sensitive discussions. CODEPENDENCY RISK China’s export curbs triggered an escalatory threat from President Donald Trump to hit Beijing with 100 percent tariffs. While Washington has since scaled back the confrontation, top U.S. officials are also drawing the consequences of Beijing’s lockdown on critical minerals. “China’s actions have once again demonstrated the risk of being dependent on them, on rare earths, and for that matter, anything,” Treasury Secretary Scott Bessent said. “If China wants to be an unreliable partner to the world, then the world will have to decouple. The world does not want to decouple.” China’s export curbs triggered an escalatory threat from President Donald Trump to hit Beijing with 100 percent tariffs. | Demetrius Freeman/The Washington Post via Getty Images Hodgson and Canadian Environment Minister Julie Dabrusin will host their G7 counterparts from top global economies, including the U.S., Japan, Italy, Germany, the U.K. and France, in Toronto from Oct. 30-31. Beijing’s new restrictions are an “amping up” of curbs on critical minerals China has announced this year, Hodgson said. G7 allies, he added, are working on “a number of actual contracts” with private sector firms that they hope to announce at the Toronto meeting. The G7 is encouraging international firms and other countries to use financial tools to increase global supplies of critical minerals. “That would include things like stockpiling agreements, that would include things like off-take agreements, that would include things like potentially contract for differences on critical minerals,” Hodgson said. Ottawa is working to implement these “in real terms” following the June G7 leaders meeting in Canada, where Prime Minister Mark Carney proposed a critical minerals buying group, Hodgson said. “Canada is a potential supplier of many of those critical minerals.”  Securing supply chains of critical minerals is playing an increasingly vital role in geopolitics as China tightens the tap on supplies. The U.K. renewed trade talks with Greenland this month, promising to secure critical minerals supply chains. And in Mumbai last week, Britain’s Keir Starmer and India’s Narendra Modi buckled down to collaborate on downstream processing and research projects to “strengthen and diversify critical mineral supply chains.” During his stay in London, Hodgson met U.K. Energy Secretary Ed Miliband and Britain’s critical minerals envoy, Industry Minister Chris McDonald. “We believe that multilateralism is the way to counter non-market activities by certain states,” Hodgson said, advocating for multilateralism in response to China’s crackdown. “We don’t believe using trade as a tool of state manipulation is in anyone’s interest.” Graham Lanktree reported from London, Camille Gijs and Bjarke Smith-Meyer from Brussels and Clea Caulcutt from Paris. Doug Palmer and Jacopo Barigazzi contributed reporting.

BERLIN — Germany’s new military procurement plan, obtained by POLITICO, shows that Berlin will steer its massive rearmament drive primarily to European industry, with only 8 percent going for American weapons. That’s a blow for Donald Trump, who has been putting pressure on European countries to continue buying U.S. arms despite the geopolitical turmoil emanating from the White House. The procurement plan shows Germany preparing to push through nearly €83 billion in contracts over the next year. The list, drawn up for the German parliament’s budget committee, details 154 major defense purchases between September 2025 and December 2026.  Under German law, any contract worth more than €25 million must be submitted to parliament for approval. And in those pages, projects led by American companies appear only in a handful of cases. The only big-ticket items with American contractors in the lead are about €150 million earmarked for torpedoes attached to Boeing’s P-8A aircraft and roughly €5.1 billion for Raytheon’s MIM-104 Patriot air defense missiles and launchers.  Counting other U.S.-led buys on the list — from AMRAAM and ESSM missiles to radio packages — the total comes to about €6.8 billion, around 8 percent of Berlin’s plan, with the rest overwhelmingly going to European industry. GOOD CUSTOMER In recent years, Germany has been one of Washington’s biggest defense buyers.  According to U.S. government data, Berlin signed off on more than $17 billion in foreign military sales between 2020 and 2024, hitting a $13.9 billion record in 2023, highlighting increased demand following Russia’s full-scale invasion of Ukraine.  That spree briefly made Germany one of the top destinations worldwide for U.S. arms exports alongside Poland and Japan. Now Germany appears to be focusing on European industry. According to the Stockholm International Peace Research Institute, European NATO members bought 64 percent of their weapons from the U.S. between 2020 and 2024. Trump wants that to continue. After clinching a trade deal with European Commission President Ursula von der Leyen in July, Trump touted that the EU would buy “vast amounts” of American weapons worth “hundreds of billions.” The only big-ticket items with American contractors in the lead are about €150 million earmarked for torpedoes attached to Boeing’s P-8A aircraft and roughly €5.1 billion for Raytheon’s MIM-104 Patriot air defense missiles and launchers. | Omar Marques/Getty Images The joint statement from that deal went even further, pledging that the EU “plans to substantially increase procurement of military and defense equipment from the United States, with the support and facilitation of the U.S. government.” But defense spending in Europe isn’t decided in Brussels, it’s decided by national governments. And in Berlin, the numbers are telling a different story. The most expensive single item is the F-127 frigate program, planned to be designed by German marine giant TKMS. Due before the budget committee in June 2026, its estimated cost runs at €26 billion. The new warships are meant to provide long-range air and missile defense for the navy. Another centerpiece is the Eurofighter Tranche 5 — built by Airbus, BAE Systems and Leonardo — with €4 billion set to be approved in October 2025 for new aircraft and another €1.9 billion for radar upgrades. Together with further investments in electronic warfare systems and avionics packages, the plan shows Berlin is doubling down on its existing European fighter fleet to bridge production delays for the troubled Future Combat Air System (FCAS), a next-generation fighter that’s supposed to be built by Germany, France and Spain. The army features prominently as well. More than €3.4 billion is planned for additional Boxer armored vehicles in October, built by Rheinmetall and KNDS. That goes along with €3.8 billion for a new unnamed wheeled tank destroyer. A few projects on the list, such as a €40 million mobile reconnaissance support system under the title MAUS, come with funding attached but no publicly designated contractor. MODERNIZATION DRIVE  Politically sensitive programs include a €2.3 billion modernization of the Taurus cruise missile, set to be approved in December. German Chancellor Friedrich Merz is under pressure from Kyiv to supply them to Ukraine, but so far German governments have balked at transferring the missiles. Air defense is another major focus. The plan includes more than €300 million for additional German-built IRIS-T SLM units, €755 million for ship-launched missiles, and €490 million for new short-range air defense missiles.  One of the more dicey projects on the list is the Eurodrone, with €196 million set aside to develop its “detect and avoid” system — a prerequisite for the drone to fly safely in European airspace. The program, led by Airbus, Dassault and Leonardo, has been plagued by delays and rising costs, yet Berlin is pressing ahead with fresh funding in this budget cycle. The navy’s share goes beyond the future frigates. Upgrades for Germany’s current F-123 frigates are priced at €1.7 billion, while a package of anti-submarine warfare systems and new torpedoes will add several hundred million euros more. The document also lists dozens of smaller but still significant contracts: €274 million for a fleet auxiliary vessel and hundreds of millions for new trucks, radios, drones, and ammunition of every caliber. Taken together, they add up to a comprehensive modernization effort touching every branch of the armed forces.