- Ukraine's defense industry wants to be able to export abroad because it can make more than the country can buy.
- Ukraine is at war, but industry says exports will unlock the kind of production it needs.
- Efficient production at scale could mean lower costs.
Ukraine's defense industry is pushing for the right to export some of its weaponry, arguing that selling arms abroad would help — not harm — the country's war effort.
Since Russia's full-scale invasion in 2022, Ukraine has effectively frozen international arms exports, tightening approval rules to make sure every available shell, drone, and missile stayed in Ukraine. Industry leaders say it's so restrictive that exporting is practically
Ukraine's defense industry has been booming as it equips the country's forces for war. Ukrainian companies now churn out drones, missiles, artillery systems, and ammunition at a pace unseen before the war. President Volodymyr Zelenskyy said that 30% of the equipment used last year was made at home, and he wants that figure to reach 50% by the end of 2025.
At first glance, exports might seem counterintuitive or risky while Ukraine is fighting a larger adversary and struggling with uncertain Western support. But industry leaders argue that exports would expand production, lower costs, and strengthen Ukraine's defense base.
Serhiy Goncharov, CEO of the National Association of Ukrainian Defense Industries (NAUDI), which represents about 100 companies, said that "the export of some part of military production wouldn't harm the defense of Ukraine," arguing instead that "it would increase the potential of the defense of Ukraine."
Unlocking production potential
Ukrainian firms say they can make far more weapons than the government can afford to buy. Goncharov said production capacity is more than three times larger than the state defense budget, but it isn't able to tap into that. He said artificial limits on the defense sector raise costs and hinder research.
Western programs aimed at boosting Ukrainian production are welcome but fall far short of filling the gap, he added.
Some companies say they have big international demand and are ready to export immediately if restrictions are lifted. Some companies are promoting their gear abroad, ready for the day they can sell it. Their view is that exports will boost overall output, helping Ukraine rather than hurting it in its fight against Russia while also boosting the health of the defense industrial base.
Scaling matters
In manufacturing, producing at a larger, more efficient scale tends to lower per-unit costs. Goncharov's argument is that with more money coming in, producers can make more, both for Ukraine and other customers, and Ukraine could buy weaponry at a lower price.
Running factories or production centers at or near capacity allows for cheaper units, while idle production lines drive costs up.
Expanded growth in the domestic defense sector would allow companies to invest more in researching and testing new warfighting technologies, Goncharov said. And these firms would also pay more in taxes, he said, benefitting Ukraine further.
Exports would also support the manufacture of niche items, specialized systems with low domestic demand but high battlefield value. One Ukrainian company, for instance, makes parachute braking systems for Soviet-era jets. Ukraine's small air force means demand is low and costs are high, but other countries still flying those jets could buy them. Goncharov said expanded demand could help Ukraine meet its own needs while challenging Russia's monopoly in that market.
He said it might help "throw Russians from this market" and keep money from reaching its defense industry, which is "better for our battle."
Foreign interest in Ukrainian weapons
Exactly how much international demand there is for Ukrainian-made equipment is unclear, but Ukraine's former defense minister said that the interest is there.
Ukraine's battlefield experiences give its manufacturers an edge over some Western companies. The country's defense sector is making drones, electronic warfare systems, and innovative components that are being put to the test on the front lines and receiving regular feedback from troops in combat.
Not everything Ukraine produces is needed in the West, which possesses larger arsenals of sophisticated weaponry, but the Ukrainian defense sector's wartime achievements have received interest from abroad, from the tech produced to the manufacturing practices employed to quickly get weapons to the front.
Some companies in the West are working closely with Ukrainian ones, with some setting up shop in Ukraine or seeking out Ukrainian parts they feel better meet battlefield demands. Cooperation doesn't stop there, though.
NATO ally Denmark is notably letting Ukrainian firms produce equipment on Danish soil, shielding production from Russian missile attacks while securing access to Ukrainian technology.
A possible loosening of the rules
While narrow and complicated processes have hindered international exports, Ukraine is looking at what might be possible. Ukrainian President Volodymyr Zelenskyy asked his defense ministry last year to draft proposals for how Ukraine could export to top partner nations.
Ukraine has taken steps toward co-producing Ukrainian weaponry in other countries in a way that would allow those countries some access to the goods.
A parliamentary committee, along with the defense ministry and other bodies, is also working on criteria under which some Ukrainian-made defense products could be exported.
Goncharov said his organization has become "more optimistic" that "this problem will be solved."
There are many considerations when it comes to the possibility of exports. NAUDI, Goncharov's organization, supports tightly controlled exports of combat-proven, high-quality gear rather than a blanket approval, warning that indiscriminate sales could damage Ukraine's international reputation or risk essential tech falling into enemy hands.
Ukraine would also need to make sure it strikes a balance between exporting and ensuring it keeps getting what it needs.
Goncharov said that for Ukrainian manufacturers, "the first priority will be the covering of the Ukrainian military needs. Everything else is additional."
