By David L. Stern
March 20, 2024
The Washington Post
KYIV — Ukraine manufactured practically no weapons before Russia invaded in February 2022, but the local arms industry is now booming. Factories spit out shells, mortar rounds, military vehicles, missiles and other items crucial to the war effort. Production tripled in 2023 and is expected to increase six-fold this year, Prime Minister Denys Shmyhal said at a Ukrainian government meeting in January. Local production is not sufficient to make up for a loss of international support, especially weapons from the United States. But with a $60 billion aid package stalled in Congress, domestic manufacturing is more critical than ever.
For certain crucial items, such as the drones that have transformed how the war is fought, Ukraine is already making 90 percent of what it needs, Mykhailo Fedorov, the digital transformation minister, said at a conference last month.
Among these items are the long-distance unmanned aerial vehicles that have struck oil facilities deep inside Russia in recent weeks, as well as the sea drones that have caused severe damage to Russia’s Black Sea fleet and helped reopen sea lanes to Ukrainian grain exports. Ukraine also builds its own mortar rounds and Soviet-standard 122mm and 152mm artillery shells.
Ukrainian defense companies are also moving to fill the military’s greatest need by building their own NATO-standard 155mm shells, which are necessary for the artillery systems supplied by Ukraine’s Western backers.
These shells are in desperately short supply on the front, but an official at Ukroboronprom, the state-owned defense company, said production would not begin until “the second half of this year.” The official, who spoke on the condition of anonymity because of the sensitivity of national security issues, did not provide further details.
But President Volodymyr Zelensky has said that domestic manufacture is key to Ukraine’s being able to sustain its defense. “This is the way out,” Zelensky told the Associated Press in December, in discussing the hope that Ukraine could fully develop its arms industry. If these aspirations are realized, he said, Russia’s plans “for destabilization, expansion, and occupation of Ukraine will end.”
While Ukraine has the manufacturing capacity and some raw materials, especially steel, the military urgently needs the weapons now. “Unfortunately, I can say that without the help of our Western partners, our friends, including from the United States, we will not be able to fully meet the needs of the armed forces of Ukraine,” said Maksym Polyvianyi, deputy general director of Ukrainian Armor, the country’s largest private arms producer. After the fall of the Soviet Union, the weapons industry in Ukraine effectively fell apart. Years of mismanagement and corruption,
coupled with the fact that much of the industry had been focused on Russian buyers, meant Ukraine had to look abroad for everything from bullets to fighter jets.
Ukraine also surrendered its nuclear arsenal in exchange for guarantees, including from Russia, that the country’s territorial sovereignty would be respected. Now, after more than two years of full-scale war, Ukraine needs everything from staples such as bullets to sophisticated weaponry such as long-range missile systems, fighter jets and bombers.
Some weapons are on the horizon. Ukraine’s minister of strategic industries, Oleksandr Kamyshin, said last month that Ukraine had deployed a locally made missile with a range of more than 400 miles. He did not provide details. Air defense systems with high-precision missiles, similar to the U.S. and Norwegian-made Advanced Surface-to-Air Missile System (NASAMS), are also being developed, officials said.
But the high-tech systems that Ukraine needs to push back the Russian invaders are a long way off from being manufactured in Ukraine. “To master such a production, to build such a production, decades must pass,” said Polyvianyi, who is also director of the National Association of Ukrainian Defense Industries, which includes more than 50 private contractors. In recent weeks, Ukraine’s troops have lost ground in the east, as they struggle with dwindling numbers of shells, bullets and even soldiers. And the situation could soon become much worse. U.S. intelligence has predicted that Ukraine may run out of air defense missiles by the end of the month. As the White House works to get the $60 billion in aid through Congress, there have been glimmers of hope for Ukraine.
Last week, the European Union approved a $5 billion military package and the Biden administration announced that it would send $300 million in aid, made possible by “unanticipated cost savings” in Pentagon contracts for Ukraine. And a Czech initiative hopes to start sending about 800,000 shells in the coming weeks. All this still falls far short of the country’s needs, however.
Ukrainian officials say they cannot disclose exact figures about their manufacturing output because of security concerns. But a laundry list of constraints — from lacking adequate financing to finding enough gunpowder — is preventing Ukrainian industry from ramping up production. “Our state budget is not enough,” said Oleksandr Zavitnevych, head of the Committee on National Security, Defense and Intelligence in the Ukrainian parliament.
Ukraine’s ability to finance domestic arms production is limited by the investment capital it can allocate, since Western financial support generally goes to non-military expenditures. This year, Ukraine will spend about $5 billion on domestic arms production, officials said, but everyone agrees that is not enough. “The main defense resource is money,” Zavitnevych said.
Raising taxes is politically risky, if not economically unfeasible, given that the country’s economy is already on life support with much of the working population living abroad, fighting in the war or unemployed.
Ukrainian officials advocate using some of the estimated $300 billion in Russian Central Bank assets frozen by the West. On Friday, German Chancellor Olaf Scholz said for the first time that he supported the idea. But even if money is found, Ukraine must confront a worldwide shortage of explosive chemicals.
Supply-chain bottlenecks and a steep increase in international demand — caused in part by the wars in Ukraine and Gaza — have exhausted supplies of gunpowder and rocket propellants. In Ukraine, this has caused periodic production stoppages, said Ukrainian Armor’s Polyvianyi. “We will reach the stage where as much gunpowder as we find, we will make as much ammunition,” the Ukroboronprom official said.
The Ukrainian government’s procurement methods also hamper production, defense contractors say, with multiple ministries signing contracts and no cohesive system. “The stupid question every time we get from different ministries is ‘How much can you produce this month?’” said Artem Viunnyk, head of Athlon Avia, which makes the Furia, Ukraine’s main reconnaissance drone for spotting artillery. “They have to understand that manufacturing does not work like that.”
Before the war, Athlon produced 100 drones a year, Viunnyk said. Now it makes 150 a month. But contracts require months of planning to buy raw materials. Viunnyk said he gives officials the same answer — he cannot increase production immediately but can build more next year with preparation. “I can do that, but tell me about this right now,” he said.
Ukrainian officials say they are streamlining the process, led by the Defense Ministry and the General Staff of the military.
Ukraine is also working with Western companies like Germany’s Rheinmetall, Britain’s BAE Systems and Turkey’s Baykar. Last month, Rheinmetall agreed on a joint venture to produce 155mm shells and propellants. Ultimately, Zelensky hopes to obtain cheap loans and licenses to manufacture and repair American weapons. As Ukraine increases arms production, Russia has begun targeting weapons factories. Many missiles are intercepted, but several reportedly have found their mark.
Ukraine does not disclose when a factory is hit. A recent trip by Washington Post journalists to a Ukrainian Armor facility producing mortars was interrupted twice by air-raid alerts. No Russian missiles or explosive drones were seen in the vicinity, however. Ukrainian Armor and other firms have moved part of their production outside Ukraine, Polyvianyi said. As a protective measure, companies break up production stages, or duplicate them, and put them in different locations. Some critical processes occur underground. All this diminishes output.
Athlon Avia’s Viunnyk said he divided his operation in Kyiv and moved part of it to Lviv in western Ukraine. After a bomb scare in Lviv, he divided production there, too. “This decreases our efficiency,” he said. “But we have to do this, because if we don’t, we could have a big problem.”
Serhiy Morgunov and Kostiantyn Khudov contributed to this report.
David L. Stern has worked for news outlets in Russia, Eastern Europe, the Caucasus, the Middle East and Central Asia. He has lived in Ukraine since 2009, covering the 2014 Maidan revolution, war in the country’s east and now Russia’s 2022 invasion. Twitter