Luxembourg has been selected as the European headquarters for a massive new multilateral defense bank, Canadian Prime Minister Mark Carney announced on Friday. The institution, which will be globally headquartered in Canada, aims to raise a staggering $135 billion to fund defense projects worldwide.
The proposed Defence, Security and Resilience Bank is designed to help small and medium-sized military firms keep pace with the soaring global demand for weapons and equipment—a surge largely triggered by the ongoing war in Ukraine. Proponents of the bank argue that existing financial frameworks, including European Union loan programs, have failed to provide adequate support for the sector, News.Az reports, citing Reuters.
“There is a critical mass of countries that intend to join… Canada is one of them, and we will be the headquarters, Luxembourg is the European headquarters,” Carney told reporters.
While Luxembourg secures the European hub, five Canadian cities are currently competing to host the global headquarters. The bank’s primary mission will be to provide vital capital to defense projects, particularly in nations that traditionally struggle to access affordable financing.
Carney also noted that he looks forward to pitching the initiative to the new UK Prime Minister. More details on which global allies will officially back the $135 billion fund are expected to emerge following next month’s NATO summit in Ankara.