© . FILE PHOTO: European Union flags flutter outside European Commission headquarters in Brussels, Belgium, April 10, 2019. REUTERS/Yves Herman By Jan Strupczewski VERSAILLES, France () – European Union leaders will prepare the ground for Friday possible unexpected expenses on the war in Ukraine, but will not mention any new joint EU debt issuance, the summit’s draft conclusions showed. Leaders of the 27-nation EU meet in Versailles, near Paris, to discuss increased defense spending following Moscow’s invasion of Ukraine, Kiev’s bid to join the EU and ways to make Europe strategically independent from global suppliers of energy, microchips and food. As a result of the COVID-19 pandemic, which has added a lot of public debt across the EU, governments planned to gradually withdraw the emergency fiscal support that had been needed to keep economies running during the lockdowns. But Russia’s invasion of Ukraine forced the EU to reconsider that approach amid an expected sharp increase in defense spending and investment in renewable energy sources to facilitate a shift from Russian gas, oil and coal. “Our national fiscal policy will have to take into account the general investment needs and reflect the new geopolitical situation,” the summit’s draft conclusions said. “We will pursue sound fiscal policies that ensure the debt sustainability of each Member State, including by encouraging investment that is growth-enhancing and essential to our 2030 targets,” the conclusions said. JOINT DEBT Some countries, such as France, want new, jointly issued EU debt to offset the shift in Russian energy imports, the impact of sanctions imposed on Moscow against Ukraine and the push for greater independence from global suppliers of food and to soften microchips. But Germany, the Netherlands and others strongly oppose such a move, saying there is still plenty of unused money in the €800 billion EU recovery fund that the bloc is already jointly borrowing to finance many of the challenges. Only €74 billion of the total EU fund has been disbursed so far, as national governments have to prepare projects that will be financed by the grants and ultra-cheap loans. “We have other instruments (than new joint debt), let’s use those first,” said a eurozone official. The draft conclusions showed that EU leaders want to fund the challenges ahead by using public funds to attract private capital and facilitate innovative projects. “We will use the European Investment Bank Group’s budget and potential to boost private investment, including higher risk finance for entrepreneurship and innovation,” they said. Disclaimer: Fusion Media would like to remind you that the data on this website is not necessarily real-time or accurate. All CFDs (Stocks, Indices, Futures) and Forex prices are not provided by exchanges but rather by market makers, and therefore prices may not be accurate and may differ from the actual market price meaning prices are indicative and not suitable for trading purposes . Therefore, Fusion Media does not bear any responsibility for any trading losses that you may incur as a result of using this data. Fusion Media or anyone associated with Fusion Media accepts no liability for any loss or damage resulting from reliance on any information, including data, quotes, charts and buy/sell signals on this website. Be fully informed about the risks and costs associated with trading the financial markets, it is one of the riskiest forms of investment possible.