Europe, the UK and Ukraine urgently need to “Trump-proof” their collective security by setting up a “Nato bank” to aid defence spending, a report suggests.

Europeans have to face the reality that if Donald Trump wins next month’s presidential election, he may quickly slash US defence spending in Europe, seek to impose a peace deal on Ukraine that leaves tracts of its territory in Russian hands and even withdraw from Nato altogether, the report by UK and German thinktanks says.

Such steps would have huge consequences for intelligence sharing and the viability of article 5, Nato’s crucial collective self-defence clause, the report, published on Wednesday, says.

“Trump’s first term was littered with withdrawn treaties, tariffs on allies and praise for authoritarian governments. European leaders need to practically and pre-emptively bolster European defence, security and resilience against a second-term Trump presidency,” said Sam Goodman, one of the report’s authors.

The report has been prepared by the New Diplomacy Project, which is advised by Sir David Manning, a former UK ambassador to Washington, and the Friedrich Ebert Foundation, which is linked to the chancellor Olaf Scholz’s Social Democratic party (SDP).

Its publication comes on the eve of a meeting in London on Thursday between the new Nato secretary general, Mark Rutte, the UK prime minister, Keir Starmer, and the UK foreign secretary, David Lammy.

Trump has said that if he wins the US election he will tell Ukraine it has to make a deal with the Russian president, Vladimir Putin. There are only three months left to convince him that the price of peace the Kremlin is likely to demand is unacceptable, the report says.

To mitigate the impact of a second Trump presidency, Nato countries should support the creation of an allied multilateral lending institution, in practice a Nato bank, it says. This could “save nations millions on essential equipment purchases, offer low interest rates on loans to alliance members and introduce a new line of financing with longer repayment timeframes. The bank would be funded with initial subscriptions from Nato members in return for authorised capital stock”.

The UK should also prepare to sign or upgrade security agreements with Germany, the EU and France, the report says. The agreements could include developing missile defence systems, air-to-air refuelling, aircraft maintenance, airlift capabilities, and joint-cyber capabilities. A UK guarantee to share intelligence from the Five Eyes alliance, which involves the US, UK, Canada, Australia and New Zealand, is also proposed.

Other threats the reports says a Trump victory could pose include a breakdown of diplomatic communication between the US and Europe, US withdrawal of troops and military assets from Europe and the widespread introduction of tariffs leading to the collapse of the World Trade Organisation.

(Source: The Guardian)