On the sidelines of the Italian-Ukrainian business forum in Rome, Yuliya Vysotska, director of international relations of the League of Defense Enterprises (LOP) of Ukraine, told the agency “Interfax-Ukraine” about the prospects for the development of the defense industry in the conditions of war.
Text: Anna Levchenko
– The President of Ukraine said that there are not enough weapons. What share of this need can Ukrainian production provide?
– There are various product groups that we can fully provide on our own. In Ukraine, there are enough manufacturers, for example, of unmanned aviation, in this segment there is even an excess of needs. In armored vehicles, Ukrainian companies can also meet our needs. The problem is different: there are groups of goods that we do not and cannot produce. These goods will be much more expensive. For example, this is artillery, ammunition, gunpowder, etc. We need help and funding in these segments. For example, with gunpowder: we could probably build a factory, but that would require investment. So the problem is the need to convey the following message to our foreign partners: don’t give us what we can produce ourselves, give us what we can’t produce. For what we can produce, give us government orders.
In 2022, more armored vehicles were contracted in Ukraine in six months than were delivered from abroad. There were problems with logistics in foreign deliveries, but domestic deliveries were completed. Domestic producers do not have the opportunity to supply or not to supply – the fines are very large, control. Therefore, domestic manufacturers are sometimes more reliable than foreign ones. I am not talking about donat or lago validity. I am talking specifically about deliveries for money, about purchases. Thanks to state orders in various product categories, we have increased production up to 10 times. And we see that there are no such production volumes or such deadlines in Europe. We are competitive.
– How innovative and modern are the weapons we produce?
– Of course, especially since the war is somewhat different now, it needs new weapons. There are many unmanned systems – both underwater and aerial. Now a drone or drone can destroy a tank that costs tens of millions of dollars. The production of drones and unmanned aircraft is developing very actively in Ukraine. We have many companies of various calibers, they produce many drones, even as many as Ukraine does not need. Therefore, the issue of export becomes very relevant. Public associations in the sphere of the defense industry are currently actively advocating the position that controlled exports should be allowed.
– How do you assess the prospects of foreign investments in the defense sector?
– We hope, but foreign companies do not really understand us. In order to implement such projects, we must be ready, in particular, prepare the necessary analytical data, financial documents, etc. We have a different financial and fiscal system. We in the Military Industry are not used to such things, and it is not very clear and necessary to foreign partners. In addition, there should be a government policy in the field of defense industry. We cannot sell ourselves, such products must be sold by the state, the country’s leadership. This is how it happens in the world.
– Are there risks that when we start, on the one hand, to actively sell some military products, the same drones, and on the other hand, ask our partners for weapons, then we will not be understood very well?
– This is a mistaken opinion. It is necessary not to ask for weapons, it is necessary to explain that funding is needed. If we have enough money to load our factories with orders, we will need exports. If there is no funding, the factories will simply close. Today, our factories work only on internal orders, and this is not enough for their work. Therefore, I will emphasize once again that the issue of controlled export is very important so that foreign countries buy weapons from us. Because we don’t have our own money, even if banks are willing to lend.
– Is there a problem with personnel in the defense industry?
– It has always been there, but now, of course, the availability of a reservation has calmed down the employees a little. The problem was when there was no reservation, when people were mobilized systematically. We are not sure that our workers or designers will be more appropriate at the front than at work, producing defense products in Ukraine for Ukrainians.
– Is Italian business ready to cooperate with defense enterprises of Ukraine?
– It depends on what conditions. If we want to buy from them, implement their solutions, of course, they are ready. We have been working with Italian companies for a long time, we are very satisfied with this cooperation, everything is great, but, unfortunately, we currently work as their customers. Therefore, of course, they are ready to cooperate. That is, my main idea on this form was that in the event that the Italian leadership spends certain funds to help Ukraine, it is necessary to develop projects in which a part will be Italian. For example, if we are talking about the production of weapons, the component base should be Italian. Then the Italian management and the Italian taxpayers will understand that it is profitable, because part of the funds is returned to the Italian budget. Simply saying: “Give money or weapons for free” does not work.
– To what extent would the Ukrainian military industry be interested in Italian technologies?
– Of course, they are interesting, but still rests on the cost. For example, there are certain combat modules that we are interested in, but they are very expensive. We really need them, because they really save lives, shoot better, are more powerful. But such products are very expensive. We do not have such funds in the budget, so we are looking for opportunities.
