The production capacity of the defense industry has tripled this year, with some areas showing a tenfold increase.

This was announced on December 27 at the briefing "Performance Results of the Ministry of Strategic Industries and Ukroboronprom for 2023" by Alexander Kamyshin, Minister for Strategic Industries.

Today, Ukraine's defense industry includes 500 enterprises that employ 300,000 people. Despite the hostilities, our country's economy is developing. And the defense industry makes a significant contribution: out of 4.9% of Ukraine's GDP growth, 1.5% was contributed by the defense industry in 2023.

Production at state-owned enterprises in monetary terms increased by 92% (compared to 2022) and amounted to more than UAH 79 billion, said German Smetanin, CEO of Ukrainian Defense Industry JSC. This is more than 637 thousand units of manufactured and repaired products, which is 1,117% of last year.

Private producers have grown even more, as has the overall share of private business in the defense industry - they have quadrupled. Today, private companies account for 4/5 of the market.

According to Alexander Kamyshin, the production of mortar ammunition has increased 42 times, and artillery ammunition - 2.8 times. Ukraine has also started producing ammunition for small arms, 73 mm, 125 mm, VOG-17, VOG-25 shells and ammunition for UAVs.

The main problem in the production of ammunition is the lack of explosives and gunpowder. This deficit exists all over the world. The solution could be market liberalization, which would allow private producers to work in this segment.

For the first time, we have reached the target of six 2S22 Bohdana armored personnel carriers per month. In November, we were able to produce 5 times more IFV (infantry fighting vehicle) than we did in the spring. Production of armored vehicles increased by 3.4 times compared to the previous year, and production of ATGMs doubled.

Thanks to the ingenuity of Ukrainian engineers, it is possible to increase the number of Ukrainian air defense systems by creating hybrid solutions. This is a combination of missiles and launchers that are not intended to be used together. An example of such a solution is the FrankenSAM program, which our manufacturers are implementing with American companies.

One of the priorities for the Ministry of Strategic Industry is to develop technological solutions that help save the lives of the Armed Forces. Ukrainian manufacturers supply a wide range of such products to the frontline: FPV drones, UAVs for reconnaissance and fire control, attack drones of various ranges, including kamikaze drones with a range of over 1000 kilometers, marine drones, ground robotic systems with various functions: for medical evacuation, logistics, and mine clearance.

As of the end of the year, the annual production capacity of public and private manufacturers was

• 1 million fpv drones;
• Tens of thousands of medium-range attack drones;
• One thousand long-range attack drones (1000+ km).

This number can be produced in Ukraine under a long-term contract with the Ministry of Defense.

To accelerate the pace of production and increase its volume, we are actively engaging defense companies from partner countries in cooperation.

The Defense Industries Alliance, established in September at the First International Defense Industries Forum, has become the center of the DFNC ecosystem. In addition to the alliance and the forum, the Ministry of Strategic Industries organized bilateral conferences with the United States, Britain, and France, where arms manufacturers can find new partners and share experiences.

The first partnership agreements between Ukrainian and foreign companies, including joint ventures, have already been signed. In order for the signed agreements to turn into real production and equipment to start rolling off the assembly lines, companies are waiting for long-term contracts with the Defense Ministry.

The Ministry of Strategic Industries predicts a sixfold increase in defense production in 2024 compared to 2023. We see a number of challenges on the way to this, the main ones being insufficient funding, lack of gunpowder and explosives, and constant shelling of our enterprises. Nevertheless, the Ukrainian defense industry is working every day to develop production to produce as many weapons and military equipment as possible for the Armed Forces of Ukraine.

We continue to build anti-corruption infrastructure. Ukroboronprom created and implemented the Strategy for Prevention, Detection and Counteraction to Corruption.

Also, the competitive selection for the positions of heads of the Company's enterprises was resumed. Thus far, 13 have been selected, and 4 more are scheduled for January. We have returned procurement to Prozorro, which also allows us to save money for the benefit of production facilities.

Since June 2023, the Ministry of Strategy and Industry has also been monitoring and coordinating the process of restoring and equipping civil defense facilities. The Ministry has launched the All-Ukrainian project "Iron Shelter". Its goal is to repair and equip civil defense shelters across the country, making them suitable and comfortable for people to stay in during air raids.

In total, in 2023, work was carried out at 6,828 sites for a total of UAH 9,189,188,620. We brought 765 radiation shelters, 5957 simple shelters, 10 dual-purpose structures, and 96 shelters into proper condition. Most of the work was carried out in Dnipro and Khmelnytskii regions and the city of Kyiv.