European Commission Allocates €500 Million to Increase Ammunition Production

The European Commission has allocated €500 million, as provided by the law supporting ammunition production (ASAP), to strengthen this sector and increase production volumes. This will allow the European defence sector to expand production capabilities to 2 million projectiles per year by the end of 2025, according to a statement on the European Commission's website.

The Commission has selected 31 projects to assist the European industry in boosting ammunition production. These projects cover five production areas: explosives, gunpowder, projectiles, rockets, as well as certification testing and refurbishment.

To implement these projects, €513 million will be directed from the EU and Norway budgets. This funding will facilitate additional investments from the industry, resulting in a total investment volume in the supply chain of approximately €1.4 billion, as noted by the European Commission.

Given that ASAP primarily focuses on gunpowder and explosives, around three-quarters of the program will be directed towards projects in these areas. The funds will specifically support projects that increase annual production capacities by over 10,000 tons of gunpowder and over 4,300 tons of explosives. For this purpose, the EU will invest €248 million in gunpowder production facilities and €124 million in explosive production facilities. It is expected that agreements with selected applicants will be signed in May 2024.

The European Commission highlights that due to the measures already taken, European annual production capacities for 155mm projectiles reached 1 million per year in January 2024.

Furthermore, the European Commission presented a new defence-industrial strategy on March 5 aimed at transforming the EU's economy into a military one and integrating Ukraine closely into it. As part of this new strategy, the EU plans to open a defence innovation office in Kyiv.

The main reforms within the EU proposed by the European Commission concern the regulation of the EU's defence market, as well as the transition to joint production and procurement. According to the European Commission, there are currently too many types of the same weapons within the EU, unlike the United States. Additionally, defence funds from member states are primarily spent outside the EU.