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Along with new weapons for Ukraine, US sets up $2.2B FMF pot for European nations

on September 08, 2022 at 11:27 AM
SECDEF Hosts Fifth Ukraine Defense Contact Group

Secretary of Defense Lloyd J. Austin III and Ukrainian Minister of Defense, Oleksii Reznikov at the Ukraine Defense Contact Group with NATO and international counterparts at Ramstein Air Base, Germany, Sept. 8, 2022.  (DoD photo by Chad J. McNeeley)

WASHINGTON — The US today announced yet another tranche of military assistance for Ukraine, including more long-range fires and 1.5 million rounds of ammo. But a smaller part of the announcement may have a greater long-term impact on European security.

The State Department announced today that it would be making $2.219 billion in Foreign Military Financing (FMF) available to Ukraine, as well as 18 other European nations, in order to help modernize the militaries in the region. $1 billion of that will be earmarked just for Ukraine, with the other countries — Albania, Bosnia and Herzegovina, Bulgaria, Croatia, the Czech Republic, Estonia, Georgia, Greece, Kosovo, Latvia, Lithuania, Moldova, Montenegro, North Macedonia, Poland, Romania, Slovakia, and Slovenia — sharing the remaining pot.

FMF is, essentially, dollars the US government gives to other nations for the purchase of US-made military equipment. Doing so, supporters say, creates a closer bond with the partner nation, while also helping pump money back into the US defense industrial base.

State notified Congress of its plan this morning and is subject to a 15-day review period. But given the Hill’s focus on arming Europe as quickly as possible, it is unlikely there will be any issues. And while $2.2 billion may not sound like a lot for 19 different nations to split, it’s worth remembering that many of these countries are still looking to modernize off of Soviet-era equipment, and lower-cost, lower-capabilities will be more helpful for them than, say, investing in a fleet of brand-new F-35s.

The idea of using American funding to help get those countries off Soviet-made kit has taken a few different forms over the years. In 2019, the State Department launched the European Recapitalization Incentive Program (ERIP), which set aside a pot of money to help Europeans buy American weapons. That effort, which has since closed down, required close-to matching funds from the country which took ERIP money.

Opening up the spigot on FMF may find greater interests than ERIP did, in part because FMF money does not require matching.

As to the direct assistance for Ukraine, today’s package includes the following under DoD’s drawdown authority, per a formal announcement:

“Our goals and aims have not changed but we remain focused on the dynamics of the fight and what is needed to be successful,” US Defense Secretary Lloyd Austin told press in Germany, following a meeting of the Ukraine Contact Group.

Notably, Austin said that there will be a meeting in the coming “weeks” of various Ukraine-backing nations armaments directors — think Undersecretary of Defense for Acquisition and Sustainment Bill LaPlante — to discuss industrial base issues and strategize on how best to keep the flow of materiel heading towards Ukraine.

“We all believe that working together, we can better streamline things — we can shorten times for [acquisition], perhaps work on supply chain issues, learn from each other,” Austin said. “We can increase interoperability by making sure that — you know, if I have a 155 [mm] Howitzer, and I’m from one country, the rounds from another 155 [mm] Howitzer can be used in that particular weapon as well. So this interoperability is important, not only in terms of the Ukraine effort, it’s important for NATO writ large.

RELATED: Multi-year procurement for munitions would help stabilize industry: LaPlante 

“So I think there are a number of things that we can do, we can work together, again, share lessons, streamline processes, and, shorten acquisition times where possible. So I think there’s broad agreement that this is an area that we can work on together and improve our ability to provide capability to Ukraine, not just for now, but for the foreseeable future as well.”

All told, with today’s announcement, the US has provided more than $14.5 billion in security assistance for Ukraine since Russia’s invasion began in February, per State Department figures.

“The United States is providing security assistance alongside our allies and partners from more than 50 countries to support Ukraine’s defense. The capabilities we are delivering are carefully calibrated to make the most difference on the battlefield,” Secretary of State Antony Blinken said in a statement.

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