Ukrainian govt seeks up to $20 billion to boost weapons production

The minister said that country's defense industry has developed significantly and currently around 40 per cent of weapons used by Kyiv's troops are Ukrainian-made

By Olesia Safronova and Alessandra Migliaccio 

Ukraine needs to attract as much as $20 billion to boost weapons production, including long-range missiles, air defense and drones, in order to repel Russia, the country’s Minister for Strategic Industries Herman Smetanin said. 

The country’s defense industry has developed significantly and currently around 40 per cent of weapons used by Kyiv’s troops are Ukrainian-made, he said. However, funding remains the main bottleneck for further growth, Smetanin told Bloomberg News in an interview on the sidelines of the World Economic Forum in Davos. 

 

Ukraine’s economy, much dependent on foreign support, can finance only half of its military production needs, he said. 

 

“In most aspects we have more capacities than funding,” Smetanin said, pointing to Kyiv’s intention to expand and develop its production of rockets, anti-missile and anti-aircraft systems. “We need to find from $15 billion to $20 billion around the world in order to increase production,” said the minister. 

 

Kyiv seeks military financing through direct purchase via the so-called “Danish model”, whereby allied governments pay for ammunition made at Ukrainian facilities. Ukraine has also set up joint arms production ventures with western companies, including Germany’s Rheinmetall AG and the UK’s BAE Systems.

 

The fight against Russia, which has many times more resources than Ukraine, requires asymmetric decisions and steps, said Smetanin. He stressed the need to develop technologies quickly in response to evolving needs on the front, as Kyiv has done with military drones throughout the conflict.

 

To wage that battle on equal terms with Russia, said Smetanin, “we definitely have to be together with our allies.”