Ukrainian Council of Defence Industry calls for uninterrupted defence procurement amid changes to the system

Amid public debate and possible changes to the defence procurement system, the Ukrainian Council of Defence Industry — the largest sectoral association of Ukrainian manufacturers of weapons and military equipment — calls on the Ministry of Defence to ensure the continuity of contracting with Ukraine's defence industry and the supply of the weapons the Defence Forces need.

For us this is not a question of personalities. No personnel, structural or procedural changes should affect the continuity of supplying the Defence Forces with weapons and military equipment.

As of mid-August, one of the key problems for the Ukrainian defence industry remains an insufficient level of contracting. Market participants estimate that up to 25% of available production capacity is currently under contract. Manufacturers of various types of weapons and military equipment are left without a sufficient volume of orders.

This is a problem not only for the companies themselves.

Weapons production has a long cycle. Once a contract is signed, manufacturers have to purchase components, set up production, carry out testing and acceptance, and only then hand the finished product over to the military.

That is why a contract not signed today cannot be offset by an immediate increase in funding a few months later. Delays in contracting in August create a risk for delivery volumes in autumn and winter.

At the same time, for the industry itself a prolonged period without sufficient domestic orders means the risk of losing engineers and production teams, cutting production lines, and reducing working capital and the ability to invest in improving and scaling up Ukrainian developments.

In recent years Ukraine's defence industry has substantially built up its capabilities in response to the state's demand and the needs of the military. It is important not to let those capabilities be lost through interruptions in contracting.

Funding remains a separate challenge. Support from international partners is critically important for Ukraine, yet individual financial instruments come with their own conditions and limitations and cannot fully replace domestic resources for procuring the entire range of items the Defence Forces require.

The Ukrainian Council of Defence Industry does not take a position on what the procurement model should be, which procedures should be used, or which body should be responsible for implementing them. Defining these mechanisms is the responsibility of the state.

What matters for the market is the outcome: the military must receive the weapons and military equipment they need without interruption and on time, and Ukrainian manufacturers must receive a sufficient volume of orders to meet those needs today and retain the capacity to produce tomorrow.

In view of this, the Ukrainian Council of Defence Industry calls on the Ministry of Defence to:

1. Ensure the continuity of contracting with Ukrainian manufacturers, regardless of personnel, structural or procedural changes in the defence procurement system.
2. Prevent any pause between existing and subsequent orders, taking into account the length of the production cycle and the need to purchase components in advance.
3. Ensure sufficient and predictable financial resources for procuring the weapons and military equipment the Defence Forces need, in particular those items that cannot be fully financed through available partner programmes.
4. Give manufacturers a clear order horizon that allows them to plan production, retain teams, purchase components and continue developing Ukrainian technologies.
5. Maintain an ongoing dialogue with the industry on the current level of contracting, production capabilities and risks to future deliveries.

The Ukrainian Council of Defence Industry is ready to provide the Ministry of Defence with aggregated data on production capacity and contracting levels, and to join the search for solutions.