Bulgaria plans to set up a centre for innovation in defence, Prime Minister Rosen Zhelyazkov said on Wednesday, emphasizing the need to modernize the country’s defence industry amid growing European security concerns.

Speaking at a Council of Ministers meeting, Zhelyazkov stressed the importance of enhancing Bulgaria’s defence capabilities to meet Europe’s increasing security demands, particularly in light of the current geopolitical landscape.

“We must enhance our capabilities with higher value-added output using existing capacities,” he said. He called for swift action from the defence minister, the economy and industry minister, and Deputy Prime Minister Tomislav Donchev, urging full Cabinet support. “Our goal is to protect Bulgaria’s defence capabilities in partnership with other EU member states and to develop this critical sector of our economy,” he added.

Zhelyazkov described Bulgaria’s defence industry as fragmented, underlining the need for better coordination to strengthen industrial and military production capacities.

His announcement comes as the European Commission proposes borrowing up to €150 billion to finance military investments across the European Union, citing security concerns following Russia’s war in Ukraine and uncertainty over U.S. commitments to European defence.

Commission President Ursula von der Leyen has outlined a €150 billion fund targeting air defence, missiles, and drones, part of a broader package that could mobilize up to €800 billion for EU defence efforts, Reuters reported on Tuesday.

The European Council will meet on Thursday to discuss short-term measures aimed at strengthening Europe’s defence sovereignty. In an invitation letter, Council President Antonio Costa said the meeting would focus on making Europe “more sovereign, more capable, and better equipped” to address immediate and future security challenges.

Following a Security Council meeting on Tuesday, where the EU’s rearmament plan was discussed, Zhelyazkov said it was “crucial” for Bulgaria to leverage new EU funding opportunities to accelerate its military industry development.

“We must improve coordination between public and private sector enterprises to strengthen our defence sector,” he said.