Foreign Military Financing (FMF)

What this funds

1 FY 2025 Estimate total excludes $275 million in emergency funding that was not designated as emergency by the President. The final level of FMF loan authority enacted via security supplemental appropriations bills from FY 2022 The FY 2027 Request of $5.25 billion for FMF promotes U.S. national security by contributing to regional and global stability; strengthening military support for key U.S. allies and other governments; and countering strategic competitors and transnational threats. The Request proposes funding for grant assistance, and funding (and related authorities) for the cost of providing up to $18 billion in FMF direct loans and loan guarantees. The direct loan and loan guarantee authority will continue a valuable tool the United States needs to help allies and others further strengthen their security capabilities and maintain the edge of U.S. industry over strategic competitors. The Request retains funding for key U.S. partners (Israel, Egypt, Jordan, and Taiwan); supports the Department's ability to address global emerging priorities - including leveraging security assistance to expand access to rare earth elements and critical minerals - and includes FMF administrative funds for managing the account. FMF Loan and Loan Guarantee Authority ($18 billion in authority): FMF direct loan and loan guarantee authority is a tool that enables the United States to offer a continuum of modern financing options for partners' purchases of U.S. defense articles. The Request seeks authority to provide up to $16 billion in FMF loans and $2 billion in FMF loan guarantees to maximize the Administration's ability to offer more competitive financing options relative to strategic competitors. The Request also advances rare earth and critical mineral objectives by reserving $2 billion in FMF loan and loan guarantee authority to loans that have Taiwan ($100 million): The Request supports Taiwan's military modernization and self-defense capabilities, strengthening cross-Strait deterrence and maintaining peace and stability across the Taiwan Strait. FMF is critical for global security and prosperity. The Request assumes that the $100 million could be deployed to subsidize a loan for significantly larger total level of assistance. Middle East and North Africa (MENA) ($5 billion): The strategic security priorities in the MENA region are to counter Iran's destabilizing influence; ensure the region will not be an incubator or exporter of terror against American interests or the American homeland; and capitalize on President Trump's successful revitalization of our alliances with Israel and Arab partners. Supporting lasting security partnerships, such as those with Israel, Egypt, and Jordan, is critical to promoting regional stability, maintaining Administration progress toward Israeli-Palestinian peace and a stable Syria, collectively deterring aggression, and reducing Egypt, and $400 million for Jordan. PM - Loans and Other Strategic Priorities ($118 million): The Department will prioritize opportunities globally that incentivize or direct arms sales which would expand capacity in the U.S. defense industrial base and ensure arms transfers are used as an intentional tool of foreign policy. Funds may provide the Department with the ability to address emerging foreign policy priorities across all regions, with particular emphasis on securing U.S. access to critical minerals of extraordinary strategic significance. Funds may pay the subsidy costs for strategically high-value loans or loan guarantees; capacity-building measures; and other strategic FMF Administrative Expenses ($32 million): The Request supports the operating costs of administering military sales, grants, loans, and other activities of security assistance offices overseas within the Department of State. Such expenses include FMF-funded State direct hire positions to address State staffing requirements for FMF and IMET programs, including oversight and implementation of FMF loans and loan guarantees. This amount will be combined with $30 million in existing mandatory DoW Foreign Military Sales Trust Fund administrative resources (funded from surcharge collections), for a total of $62 million for

Extracted from Foreign Operations, p. 94. Verbatim; nothing here is paraphrased.

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