The European Commission has welcomed the first steps towards a European Defence Union.

Plans presented by 25 member states – including Luxembourg – aims on working together on a first set of 17 collaborative defence projects in the framework of Permanent Structured Cooperation (PESCO).

PESCO is an instrument in the EU Treaty to enable willing member states to pursue greater cooperation in defence and security.

President of the European Commission, Jean-Claude Juncker, who has been calling for a stronger Europe on security and defence since his election campaign, tweeted that the "sleeping beauty of the Lisbon Treaty" is happening.

"Europe cannot and should not outsource our security and defence," he added in a statement. "The European Defence Fund that the European Commission proposed will complement these efforts and act as a further incentive for defence cooperation – including potential funding for some of the projects presented today."

On Monday the 25 member states signed a declaration announcing the preparation for first collaborative projects in areas including the setting up of an EU medical headquarters, maritime surveillance, underwater drones and cyber-defence.

The European Defence Fund proposed by the European Commission will create incentives for Member States to cooperate on joint development and the acquisition of defence equipment and technology through co-financing from the EU budget and practical support from the Commission.

The first grant agreements could be signed before the end of the year.