Since the first months of Russia’s full-scale invasion in spring 2022, Kyiv has hosted a steady stream of visiting European officials eager to demonstrate their support for Ukraine. As the war enters its fourth year, there are growing signs that this relationship is evolving and becoming more balanced. While Kyiv continues to rely on European assistance, it is increasingly clear that Ukraine also has much to offer and can play an important role in Europe’s future security.
Since returning to the White House in January, US President Donald Trump has initiated a dramatic shift in US foreign policy that has left many in Europe unsure of the transatlantic alliance and eager to build up their own defence capabilities. This geopolitical instability is also prompting European policymakers to rethink Ukraine’s role in the continent’s defence. With unparalleled combat experience and a proven ability to ramp up arms production at relatively low cost, Ukraine is in many ways an ideal partner for European countries as they face the dual challenges of an expansionist Russia and an isolationist US.
Ukraine’s defense industry has grown at an unusually rapid pace since 2022, and is now capable of meeting about 40 percent of the country’s military needs. The segment that has attracted the most international attention so far is drone production, and Ukraine is widely recognized as a world leader in drone warfare. It takes a careful approach to identify the few gems among the hundreds of Ukrainian companies that currently produce more than a million drones a year, but the potential for revolutionary advances in drone technology is clear.
To make the most of this potential, Ukraine must first ensure its survival as an independent state. Looking ahead, a key challenge for Ukrainian authorities will be to create a business climate that will allow the country’s growing defense industry to thrive in a post-war environment that is likely to be characterized by shrinking defense budgets.
Currently, many Ukrainian defense companies are moving production outside of Ukraine due to a number of factors, including export bans and a lack of domestic financing options. The most elegant solution to this problem is to promote more defense partnerships with Ukraine’s European allies.
During the first few years of Russia’s full-scale invasion, security cooperation between Ukraine and the country’s partners was largely a one-way street, with arms and ammunition flowing into Kyiv. More recently, a new model has emerged in which Western countries finance production at Ukrainian defense enterprises. This approach is effective and strategically sound. It strengthens Ukraine militarily and economically, and leverages the country’s strengths as a cost-effective and innovative weapons producer. But it has little long-term appeal for Ukraine’s partners.
Joint ventures between Ukrainian and European defence companies may be a more attractive and sustainable format. This would be a financially attractive way to fuel European rearmament and would allow the companies involved to exploit a wide range of potential research and development synergies. Setting up production facilities in wartime in Ukraine would certainly involve an element of risk, but this need not be a deal-breaker if reasonable safeguards are in place.
The potential for such joint ventures is enormous. Indeed, it would be wise to invest in specialized business and science parks that provide a full range of related services and industry expertise. Initially, jointly produced equipment could be quickly shipped to the Ukrainian Armed Forces. In the future, the products could also be exported to partner countries and global markets. The growth of joint ventures would significantly enhance Ukraine’s defense potential and increase the country’s ability to defend Europe from the Russian threat.
An ambitious European rearmament plan is currently being formulated that could significantly accelerate the integration of Ukraine’s defense industry. This will first require resolving a number of regulatory and operational issues in Kyiv, Brussels, and various European capitals. While Ukraine can undoubtedly make a significant contribution to European security, the continent’s political complexities are particularly evident when it comes to defense budgets and procurement policies. A degree of pragmatism will be needed to dismantle bureaucratic hurdles and overcome narrow national interests.
As European leaders adapt to radical changes in the geopolitical landscape, Kyiv is ideally positioned to help the continent address its most pressing security needs. Ukraine’s military is the largest in Europe and has unparalleled experience in modern warfare. It is supported by a domestic arms industry that is growing at a phenomenal rate, benefiting from an innovative start-up culture that is transforming the twenty-first century battlefield. With sufficient international funding and technological cooperation, Ukraine’s defence sector could serve as a cornerstone of Europe’s security architecture for decades to come.
Pavlo Verkhnyatskyi is a Managing Partner at COSA, co-founder of the Fincord-Polytech Science Park and an Advisor to the Defense Group at the Ukraine Facility Platform.
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