Czech Leopard 2 order could be financed by SAFE

The Czech Republic has expressed interest in making use of the EU’s Security Action for Europe (SAFE) loan mechanism to finance its purchase of Leopard 2 tanks, according to a July 23 MoD press release. 

Minister of Defence Jana Černochová informed other Czech ministers of these steps during a Government Committee for the EU meeting, explaining that: “The importance of the SAFE loan is not only financial. Its aim is to contribute to strengthening Europe’s defense capability through joint purchases of military equipment from the European defense industry. By participating, the Czech Republic is showing that it wants to be part of this process.”

The loan has made €150 billion available in funding to EU states for defence equipment that must be delivered by the end of 2030. Specific terms for the loans are to be decided between each government and the EU, a process that the Czech Republic will have to negotiate in the coming months. 

The cost of procuring the Leopard 2A8s is estimated to be €2.1 billion (£1.82 billion), but the SAFE loan could save the country from paying VAT, the MoD states. The Czech armed forces have indicated a requirement for between 44 and 77 vehicles, which includes combat engineering and support platforms as well as regular Leopard 2A8s. They will be procured at the same standard as the Bundeswehr’s and from the same framework agreement with KNDS. This is understood to be the approach taken by Lithuania, which helps speed up delivery and achieve a better price for the vehicles. 

Calibre comment

The Czech armed forces are replacing most of their armoured vehicles including a large €2.2 billion procurement of CV90s, and the stated intent to replace its fleet of Pandur IFVs. This represents a very significant commitment for the Czech forces, and the country is actively seeking opportunities to realise cost efficiencies through joint procurements wherever it can. 

By Sam Cranny-Evans, published on July 24, 2025. Credit for the lead image is the Czech MoD.