The European Union has declared that its 60,000-member rapid reaction force is ready to conduct peacekeeping missions within and beyond Europe, despite shortfalls in various types of military hardware.

A statement issued as EU defense ministers are meeting in Brussels points up Europe's defense dilemma.

It says the 15-nation bloc's member countries have agreed to make new contributions to a pool of military personnel and equipment to enable the so-called rapid reaction force to conduct tasks that range from separating warring parties to engaging in humanitarian and rescue operations.

But the statement also owns up to the fact that the force's capacity to undertake such missions is limited, and restrained by the lack of modern capabilities, such as air-to-air refueling, precision weapons and protection against chemical and biological warfare.

Although boosters of the EU force claim that it will give the bloc military and political, as well as economic clout, EU countries, with the exception of Britain and France, have failed to spend enough over the past several years to modernize their armed forces.

The European Union has also been criticized for creating too many committees and increasing paperwork instead of spending what it needs to on weapons.

Last month, four countries opposed to the U.S.-led Iraq war suggested that the European Union set up a military headquarters independent of NATO. But other, more Atlantic-minded countries scoffed at the project, saying what European defense needs is more transport aircraft and more precision-guided munitions. They also say the EU defense project should be closely linked to the NATO.

The European Union has already taken over from NATO's small peacekeeping force in Macedonia and wants to replace the alliance's 17,000-man force in Bosnia next year. The European Union says it is on track to do so, but some diplomats privately express their doubts.

With military budgets across most of the bloc falling or stagnating, the defense ministers have suggested new ways to cut costs.

They are talking about coordinating procurement practices, pooling equipment, and increasing specialization to avoid duplication of military resources within the bloc.

A more controversial idea, supported by the defense ministers of Italy, Germany, France, and Belgium, is that the European Union should relax rules that limit a country's budget deficit to three percent of gross domestic product. That way, they say, their governments could spend more on defense.

But German Defense Minister Peter Struck acknowledges that EU finance ministers will have what he calls major qualms about such an idea, especially with the EU economy on the edge of recession.