Melania Parzonka is a coordinator for Chatham House’s Russia and Eurasia Program.
Ukraine’s parliament is currently discussing easing wartime restrictions on domestic arms exports and exploring different models for international cooperation.
Put in place at the beginning of Russia’s full-scale invasion, the “ban” on exports was intended to make sure all essential military supplies remained in the country. If it was to sustain the fight against an enemy with a far larger stockpile, Ukraine needed all the armaments it could get.
Over time, however, Ukraine’s production capacity has grown beyond what its state contracts cover and what the government has funds to procure. For example, it is now estimated that Ukraine’s private defense sector has the capacity to produce over 1,700,000 more drones and electronic warfare systems (EWs) than it currently does.
There are several ways to take advantage of this. One possibility is that international partners purchase weapons from domestic producers on behalf of Ukraine — the so-called Danish model.
Another possibility is exporting. Supporters of this approach say that the duties and revenues from exports would provide a financial boost to further develop new capabilities, as well as increase funds to cover domestic needs through state procurement.
For Ukraine’s allies — Europe, in particular — it would open up a supply of field-tested capabilities and equipment.
Of course, there are some fundamental counterarguments. Beyond the obvious need to carefully select trading partners and technologies for export in order to prevent operational risks, the type of defense products Ukraine is willing to export come with implications for buyers.
The war in Ukraine has rapidly accelerated the innovation cycle. Drones, EWs and unmanned ground vehicles quickly grow obsolete. And fast-evolving systems, while providing a technological edge over the enemy, defy the purpose of stockpiling for the possibility of a future conflict.
But beyond this, the question of Ukrainian arms exports is also about supporting Europe’s new defense ecosystem.
European armies would greatly benefit from access to Ukrainian domestic arms production, allowing them to train soldiers in drone warfare and integrate drone units in command structures, thereby adapting to the realities of modern warfare at low cost.
For Europe, setting up its own drone industries from scratch would take years, whereas partnering with Ukraine offers a readily available solution to fill capability gaps.
For Ukraine, on the other hand, over 40 percent of weapons currently used by its army are domestically produced, with a heavy focus on innovative weapons systems. But the industry needs to scale up its production of strategic weapons, particularly cruise and ballistic missiles and strategic air defense — which is where cooperation with European partners and investment is most needed.
The good news is that the EU’s recent establishment of a €150 billion defense fund under the Security Action for Europe (SAFE) initiative enables Ukraine’s participation in joint defense procurement and borrowing in partnership with EU members. And crucially, these funds can only be spent on defense products where at least 65 percent of components are produced by an EU country, Norway or Ukraine.
Along these lines, Kyiv has already successfully established joint ventures with European defense partners, like Rheinmetall or Thales. If it can now open its defense exports, it can benefit from the nascent EU scheme even more.
With any ceasefire looking unlikely, there’s a continued need to strengthen Ukraine’s armed forces and defense capabilities, while simultaneously building on the country’s experience for European rearmament.
Opening up Ukraine’s defense industry would permit further bureaucratic integration and cooperation with the EU, and allow Ukraine’s economy to benefit directly from European rearmament.
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