(a)

the pMS have continued increasing their defence expenditure, leading to a 12 % growth in 2023, with further increases forecast for 2024-2025. Moreover, 25 % of the total defence expenditure allocated to defence investment in 2022 was used to accelerate the procurement of needed capabilities and the replenishment of stocks with predominantly off-the-shelf procurement in search of immediate solutions, and also benefitting the EDTIB. Recalling the Versailles agenda and the Strategic Compass, the Council reiterates the need to spend more and better in defence and to improve capability development and planning in the EU in order to better address operational realities and new threats and challenges. At the same time, the Council calls for a combined effort by all the pMS to reverse the decline in defence Research and Technology spending from 1,7 % to 1,1 %, remaining well below the 2 % collective benchmark. Boosting research, technology, development and innovation, as well as acquisition – particularly in a joint manner between the pMS - should remain a priority for the pMS, while striking the right balance between long-term innovation for future capabilities and adequate quantities of military equipment and stockpiles, also with a view to strengthening the EDTIB;

(b)

the pMS have demonstrated some improvements in the use of the EU capability development tools and initiatives as references in national processes. In this respect, they are encouraged to make full use of the EU prioritisation tools and initiatives, notably the EU Capability Development Plan (CDP) which serves as a central reference for EU capability development, taking into account the Headline Goal Process for capability planning, and for all EU defence-related initiatives and instruments, as well as recommendations of the Coordinated Annual Review on Defence (CARD) to inform national capability planners, thus supporting the pMS’ efforts towards making their defence plans converge, where possible. The Council recalls that coherence of output between the CDP and the CARD, on the one hand, and respective NATO processes such as the NATO Defence Planning Process, on the other hand, has been and will continue to be ensured where requirements overlap, while recognising the different nature of the two organisations and their respective responsibilities and memberships;

(c)

in order to fill the persisting gaps that should be filled urgently, the pMS are encouraged to step up their contributions to the on-going military common security and defence policy (CSDP) missions and operations, and the Comprehensive Database, which is built on EU Battlegroups Roster, the Rapid Response Database and Force Element Lists, and which provides a fundamental element of the EU Rapid Deployment Capacity (EU RDC) architecture, while taking into account the single set of forces principle. Moreover, recalling the Headline Goal Process, the pMS are encouraged to address more specifically strategic capability shortfalls, namely the High Impact Capability Goals . In addition, the pMS should finalise the re-assessment of the scope and definition of the common costs of military CSDP missions and operations, military exercises and the EU RDC with a view to reaching a political agreement in 2023. The work on the definition of the parameters of a fair share of contributions to military missions and operations, as requested in the Recommendation of 16 November 2021, should be finalised as soon as possible;

(d)

the pMS have not yet sufficiently prioritised a European collaborative approach in addressing capability gaps. While the Council welcomes the fact that the pMS are increasingly exploring EU collaborative options to address urgent needs and increase the availability and effectiveness of defence capabilities, it encourages them to invest more and use the growing defence budgets also to invest in European collaborative solutions to close capability gaps, thus contributing to a more coherent EU defence landscape and to reducing technological and industrial dependencies, when feasible;

(e)

the pMS have continued to use the European Defence Agency (EDA) as the principal European forum for joint capability development, in particular for activities such as harmonisation of requirements and innovation and as a framework for joint procurement. Harmonisation of military requirements as well as the interoperability of armed forces, in terms of both capabilities and operations, remain core objectives in line with the commitments undertaken in PESCO;

(f)

the pMS have focused on enabling their national industries to take part in cross-border cooperation within the EU, particularly under the European Defence Fund. Some pMS signal the intention to adjust national defence industrial policies and strategies in the context of the changing security environment, including addressing security of supply and reducing strategic dependencies. The Council highlights that the reactiveness and resilience of the EDTIB should be bolstered to face high-intensity warfare scenarios and encourages the pMS to take advantage of new initiatives to ramp up EU defence industrial production capacity. The pMS are also invited to continue their involvement in cooperation programmes that have a positive impact on the EDTIB, including by considering those programmes in their acquisition strategies and procedures.