The $100B Opportunity in Europe’s Defence: Why Now Is the Time to Act
The defence sector is experiencing accelerated growth, with Europe and the UK committing record spending to enhance combat readiness over the next decade. Investments of over $100 billion annually in defence-related infrastructure by 2035, according to A&M estimates based on current plans, will play a critical role in this expansion.
Historically, governments have used public–private partnerships (PPPs) to deliver critical defence infrastructure. Private infrastructure funds have been a major provider of capital for these projects, offering a flexible and timely solution to address defence capital needs, particularly as countries in the region grapple with high levels of debt.
Governments are increasingly recognising the importance of private finance in driving defence development. In April, the UK Defence Secretary reaffirmed the government’s commitment to higher spending and reforms to attract private capital to the sector,[1] whilst the European Union (EU) is proposing measures to cut red tape and facilitate investment into defence capabilities.[2] BlackRock and BNP Paribas are just two of several funds created this year to capitalise on Europe’s defence spending momentum.[3][4]
As this trend continues, we anticipate a wave of new infrastructure funds to enter the market, making now the right time to strategise, place bets, and seize opportunities in this high-growth sector.
At A&M, our senior-led team of infrastructure experts across Europe provides end-to-end support for PPP and defence infrastructure funds, leveraging exclusive methodologies to navigate capital-intensive, long-maturity projects with strategic insight and operational excellence.
[1] “UK government courts venture capital to boost defence industry,” Reuters, April 2, 2025.
[2] “Commission proposes simplification to speed up defence investments in the EU,“ European Commission, June 16, 2025.
[3] “BNP Paribas Asset Management launches Europe Strategic Autonomy Fund to capitalise on shifting geopolitical priorities,” BNP Paribas Asset Management, June 3, 2025.
[4] ”iShares Europe Defence UCITS ETF,” iShares by Blackrock (accessed September 30, 2025).
