KYIV, Feb 20 (Reuters) – Ukraine may export billions of dollars in military goods and services this year and is considering imposing taxes on those exports, a senior Ukrainian defense official said, after authorizing its first wartime foreign sales.
Davyd Aloian, deputy secretary-general of Kyiv’s National Security and Defense Council, told Reuters that earlier this month the state committee responsible for processing wartime-related licenses approved most of 40 export applications for supplies and services submitted by defense sector producers.
Ukraine stopped arms exports after Moscow’s February 2022 invasion and relies heavily on weapons supplies from partners to defend Russian forces.
At the same time, Kyiv has invested resources in developing its arms industry, especially drones and missiles. With rich battlefield experience, Ukraine has experienced a defense technology boom in recent years.
Asked about the export potential this year, Aloiian said: “Taking into account the ready-made products, spare parts, components and services that can be provided, the exports amount to billions of dollars.”
Overall, he said, the potential was “significantly higher” than pre-war exports.
But Alloyan, who is a member of the Export Authorization Committee, played down talk of an immediate boom in exports from arms producers and developers.
He said Ukraine’s own military needs must come first as Russian forces advance in the country’s east and airstrikes hit towns far from the front lines.
U.S.-brokered peace talks have stalled as Russia demands territorial concessions.
foreign interests
Aloyan said Ukraine’s allies have expressed interest in acquiring its cutting-edge defense technology, with the most keen ones including Germany, Britain, the United States, Nordic countries, three Middle Eastern countries and at least one Asian country.
Aloian said one of the Middle Eastern countries with a long history of arms trade with Ukraine was exploring opportunities with drones and heavy vehicles, but he declined to name the country.
Aloyan said exports would be prioritized to countries that were Kiev’s strongest supporters in the war.
Kyiv also plans to prioritize joint ventures and other forms of cooperation with foreign countries to attract financial resources, create new weapons supply chains and acquire new technologies for the front line. There’s more to it than simply exporting ready-to-use products, Aloian added.
Defense manufacturers have been urging Ukraine to resume exports, saying it could cost opportunities in the global arms market. Some have set up subsidiaries to operate overseas.
