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EurActiv: Ukraine plans to use Russia’s frozen assets to boost arms production

Ukraine is exploring ways to bolster its domestic arms industry with support from the European Union, according to Ukrainian Minister of Strategic Industries Oleksandr Kamyshin.
Illustrative image
Ukrainian flags outside the EU Parliament building in Brussels. Illustrative image. Photo via European Interest.
EurActiv: Ukraine plans to use Russia’s frozen assets to boost arms production

Kyiv seeks EU assistance to boost funding for its domestic arms industry and tap additional non-contracted capacities, Ukrainian Minister of Strategic Industries Oleksandr Kamyshin told Euractiv.

Earlier, Kamyshin claimed that Ukraine resumed its own production of artillery ammunition, but given the vast needs of its Defense Forces and the scale and intensity of the war, the country still relies on ammunition supplies from partner countries.

“In terms of scale and cost, we‘re efficient and capable of producing enough—the only thing that is missing is funding,” the minister said on the sidelines of the EU-Ukraine Industry Forum in Brussels.

According to Kamyshin, Ukraine proposed to find additional sources of financing by using up to three billion euros in windfall profits from Russian frozen assets, which are known to be mostly kept on European accounts.

Another way is “extending European Peace Facility funds to reimburse member states that procure directly from Ukraine and leave said equipment in Ukraine – it’s fast, it works, it will be great,” the official said. The facility, established in March 2021, funds military aid and EU military missions abroad. As of March 2024, €11.1 billion of EPF funding has been committed for military support to Ukraine.

The third plan is “making procurement from Ukrainian producers part of the European Defence Industry Programme”, Kamyshin said.

The European Commission proposed that Ukraine become a member of the EU’s defense industry support scheme. The country will receive access to the bloc’s industry and funds, joint procurement of military equipment with other EU member states, and VAT-exemptions for joint ownership under the scheme. However, negotiations over the program might stretch into next year.

The EU-Ukraine Defense Industry Forum, held in Brussels on 6 May, has gathered more than 350 participants, including representatives of government organizations and European businesses.


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