As countries in the region spearhead efforts to support Ukraine in its conflict with Russia, Europe's weapons industry is producing artillery shells and other military supplies at a rate unseen since the end of the Cold War, according to Reuters.
New Business Prospects
Ever since Russia invaded Ukraine on February 24, allies have been providing Kyiv with arms and military hardware while also reducing their stocks in the process.
Experts, analysts, and government officials told Reuters that the raging war also paved the path of new business prospects for the region's arms sector.
According to Sebastian Chwalek, CEO of Poland's PGZ, there is an opportunity to venture into new markets and boost export revenues in the upcoming years, since many countries have increased their defense budgets amid the Russia-Ukraine war.
State-owned PGZ owns shares in more than 50 businesses that produce weapons and ammunition, ranging from unmanned aerial systems to armored carriers, as per Reuters.
Chwalek said that they plan to invest up to 8 billion zlotys ($1.8 billion) over the following ten years, a doubled increase from its pre-war goal. He added that new facilities are being built far away from Belarus' border with Russia due to security reasons.
Czech STV Group CEO David Hac explained to Reuters the company's ambitions to create additional production lines for small-caliber ammunition and revealed that it is planning to increase its large-caliber capability.
According to businesses and government representatives from Poland, Slovakia, and the Czech Republic, other manufacturers are also stepping up output and competing for personnel.
Chwalek claimed that PGZ will now construct 1,000 portable Piorun manpad air-defense systems in 2023, as opposed to 600 in 2022 and 300 to 350 in prior years-not all of which would be for Ukraine.
He said that the company has also given Ukraine howitzers, protective vests, small guns, and ammunition. He further claimed that they are likely to beat a pre-war 2022 revenue target of 6.74 billion zlotys.
Supporting Ukraine, Expanding Weapons Sector
According to Christoph Trebesch, a professor at the Kiel Institute, Eastern European nations support Ukraine significantly while also taking advantage of the opportunity to expand their military manufacturing sector.
The Deputy Defence Minister of the Czech Republic, Tomas Kopecny, said that Ukraine has purchased weapons and equipment from Czech enterprises worth up to 50 billion crowns ($2.1 billion), the majority of which were commercial deliveries.
This year will see the highest level of Czech arms exports since 1989, according to Kopecny, since several businesses in the industry have increased capacity and employment.
Kopecny added that the Ukrainian conflict and the support it brings to the country's defense sector are unquestionably a boost unlike anything seen in the previous 30 years.
The Czechoslovak Group, which owns businesses like Excalibur Army, Tatra Trucks, and Tatra Defence, increased its first-half revenues from a year earlier to 13.8 billion crowns ($588 million) thanks to its sales of defense equipment.
According to company spokesperson Andrej Cirtek, they are rebuilding T-72 tanks from the Soviet era as well as infantry fighting vehicles and 155mm NATO and 152mm Eastern caliber ammunition.
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Written by Jace Dela Cruz
