US preps unusual $2B loan to Polish military

US preps unusual $2B loan to Polish military
# 26 September 2023 12:23 (UTC +04:00)

The U.S. will loan $2 billion to Poland’s military, using a little-used funding mechanism to support Poland’s push to rearm in light of the war in Ukraine, APA reports citing Defense One.

The loan, announced Monday, will come via the State Department’s Foreign Military Financing program. The program typically funds foreign military acquisition through grants, but also allows the U.S. to provide countries with loans. The last such loan was given to Iraq in 2017, following ISIS’s rise to power, a State Department spokesperson said.

The State Department requested just over six billion dollars for foreign military financing grants in the 2023 budget, similar to requests made in 2021 and 2022.

However, with billions already distributed in response to Ukraine, there’s little left over to send to allies as grants. By structuring the support as a loan, the U.S. can continue to support Poland, the State Department spokesperson said.

The U.S. will also give Poland up to $60 million to reduce the loan financing rate, according to the State Department’s announcement.

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