European Commission Announces €1.07 Billion in Defence Fund Projects

26 billion) in EU funding. Of the total funding, €675 million ($796 million) will support 32 capability development projects, while €332 million ($391 million) will go to 25 research initiatives. The selected projects involve 634 entities from 26 EU member states plus Norway, with small and medium-sized enterprises making up more than 38% of participants and receiving over 21% of the total funding.

At least four initiatives—EURODAMM, LUMINA, SKYRAPTOR, and TALON—are focused on loitering munitions and affordable mass drone production. Additionally, the STRATUS project will develop an AI-powered cyber defense system for drone swarms and includes a Ukrainian subcontractor.

For the first time, Ukrainian entities are eligible to participate in EDF projects as subcontractors and third-party recipients.

Kyiv and Brussels are expected to complete an association agreement in the coming months to allow Ukraine full participation in EDF projects on equal terms with EU member states. The EU Defence Innovation Office in Kyiv was established under the European Defence Industrial Strategy in 2024.

More than 15 of the 57 projects are tied to the Commission’s four European Readiness Flagships, identified last year as priority capability areas critical to near-term operational readiness.

Projects such as AETHER will develop propulsion and thermal management systems in support of the Drone Defence Initiative. Several projects focused on mass-producible drone munitions will launch sub-calls for startups and small and medium-sized firms, including Ukrainian ones, which can receive up to €60,000 each to integrate innovations into larger consortia.

77 billion) work program adopted in March.