The second American loan for the purchase of armaments

On Monday, July 1, 2024, as reported by the Ministry of National Defense, Poland and the United States signed a direct loan agreement under the Foreign Military Financing (FMF) program for an amount of 2 billion USD (8.05 billion PLN).

Photo: Ministry of National Defense

This is the second loan granted by the U.S. government to Poland in recent times. Foreign Military Financing funds are allocated only to selected U.S. allies with whom the United States has close defense cooperation.

This is therefore an expression of the continuously developing strategic relations between Poland and the USA. The United States remains our main foreign partner in the modernization of the Polish Armed Forces, including through the acquisition of Patriot and HIMARS systems, Abrams tanks, and F-35A aircraft. The USA continuously strengthens our deterrence and defense potential through the presence of its troops in Poland. A very important element of our relations is also the cooperation in support of Ukraine.

The acquired funds will be used to further strengthen Poland’s defense capabilities through the purchase of air and missile defense systems from the American side. Such systems are a priority for the Polish Armed Forces given the current threats. It is worth highlighting the very favorable financial terms of the agreement.

Press release

Polska i Stany Zjednoczone zawarły umowę pożyczki bezpośredniej w ramach programu Foreign Military Financing na kwotę 2 mld USD. Pozyskane fundusze zostaną przeznaczone na dalsze wzmacnianie potencjału obronnego Polski poprzez zakup od strony amerykańskiej zdolności z zakresu…

— Ministerstwo Obrony Narodowej 🇵🇱 (@MON_GOV_PL) July 1, 2024

MILMAG Commentary:

During the visit to Washington on March 12 of this year by the President of Poland, Andrzej Duda, and the Prime Minister of Poland, Donald Tusk, the United States announced granting a 2 billion USD loan. As it turned out on May 22, 960 million USD of this loan will be allocated for the purchase of reconnaissance aerostat systems codenamed Barbara.

On September 25, 2023, the U.S. Department of State announced the signing of the first loan agreement with Poland, also worth 2 billion USD under the FMF program, to support the modernization of the Polish Armed Forces. Earlier, on September 29, 2022, the U.S. Embassy in Warsaw announced that the United States would provide Poland with 288.6 million USD (1.435 billion PLN) in non-repayable financial assistance under the FMF program to support the Polish Armed Forces.

However, on March 24, 2023, after the conclusion of the European Council Summit, then-Prime Minister Mateusz Morawiecki announced that as compensation for the weapons provided to Ukraine, Poland would receive a total of 800-900 million EUR (up to 4.22 billion PLN). It is also worth noting that on April 25 of this year, Minister of Foreign Affairs Radosław Sikorski informed the Sejm that Poland had so far provided Ukraine with military assistance worth approximately $4.5 billion.