Should Poland take the $44 billion SAFE loan?
The case for seizing the opportunity to build a domestic military industry
March 13, 2026 · Also published on Substack and 𝕏.
On March 12, President Nawrocki vetoed Poland's participation in SAFE — the EU's €150 billion defense loan program.
This is probably his first decision as president that I don't agree with.
Here is why.
What is SAFE
SAFE (Security Action for Europe) is the EU's first defense financing instrument. The European Commission borrows on capital markets, then re-lends to member states at favorable terms.
The terms are very good:
- 3.17% interest
- 45-year maturity
- 10-year grace period before repayment starts
There is €150 billion of total liquidity offered to member states.
The initiative started because of Russian aggression in Ukraine, the necessity of building real defense capability in Europe, and the fact that under Trump, the United States is no longer a reliable partner when it comes to securing Europe's stability.
Due to our geography, Poland got the largest allocation — €43.7 billion, nearly 30% of the entire fund.
Should we take the loan?
The Polish dilemma
The SAFE vote has dominated Polish public debate over the past few days.
Both sides accuse each other of acting against Poland's interests.
I think both sides have real merit.
The case for SAFE
We need to arm ourselves and SAFE is the cheapest way to do it.
Polish sovereign bonds yield ~5.7%. SAFE offers 3.17%. The spread amounts to roughly €1 billion per year in savings on €44 billion of borrowing.
Over the life of the loan, we pay significantly less than it would cost to borrow on our own. And the 45-year maturity with a 10-year grace period is something we simply can't get on the open market.
Account for inflation (eurozone has averaged ~2.1% since the euro's introduction) and this gets dirt cheap.
It comes from trusted partners with shared interests.
And since minimum 65% has to be spent with European companies (and ideally domestically), this will boost the whole European, and Polish, economy.
The case against SAFE
A loan of this size makes us reliant on the European Union.
We have a precedent — Brussels froze €137 billion for Poland for nearly two years under the previous government, using a similar conditionality mechanism to the one built into SAFE. The money only flowed again when the government changed for a pro-EU one.
The 65% European content rule limits our ability to buy American and Korean systems — equipment our military already uses and trusts.
On top of that, the EU was always supposed to be an economic collaboration.
Its involvement in defense is new and handing Brussels influence over how we arm ourselves is a shift in what the union is, and that shouldn't be taken lightly.
Taking the loan is net negative for polish sovereignty.
Real opportunity
Both positions are fair and represent viable paths for the future.
I don't blame anyone for taking either side.
I would love to highlight an opportunity that tends to be missing from the discussion.
Polish military-industrial complex
The Polish economic miracle of the past 30 years is real.
We are the fastest growing major economy in Europe.
Industry, exports, consumption — all growing.
Poland today is a completely different place than the Poland I grew up in.
But historically, we haven't had much of a military industry. We are forced to buy advanced equipment from the United States, Korea, or Western European countries. We are a customer, not a producer.
This can change. Access to liquidity of this size can enable us to build our own companies, our own industries, our own capability for domestic production. SAN is one of the first exciting investments enabled by SAFE.
The battlefield is also changing dramatically. Drones, AI, modern electronic warfare — many of these systems were pioneered and battle-tested in Ukraine. The next generation of weapons looks nothing like the last one, and we could be the leaders in bringing those to market.
If we spend the SAFE resources right, the benefits go far beyond arming ourselves with foreign-produced weapons.
We can build our own industry and secure our own economic future.
Execution
Building a military industry is super difficult, especially for a democratic country with a free market economy.
It's slow, capital-intensive, and inefficient.
Most of the SAFE funds will still go toward buying foreign equipment.
But the opportunity is real, and if there is a path for Poland to become the wealthiest and most important country in Europe, it probably relies on taking bold actions like this one.
Leveraging ourselves and betting hard on our ability to execute.
