At today’s CEPA-hosted press call on revitalizing the transatlantic defense-industrial strategy, Mariana Fakhurdinova, TDC EU–Ukraine Partnership Program Coordinator offered a crucial on-the-ground perspective on the evolving role of Ukraine in shaping the future of transatlantic defense cooperation.
In a discussion featuring top defense experts from both sides of the Atlantic, Mariana spotlighted Ukraine’s strategic value as both a partner and innovator in the emerging defense landscape, as well as the systemic barriers that still limit its integration into broader U.S. and EU defense-industrial ecosystems.
Key Barriers to U.S.–Ukraine Defense-Industrial Cooperation
Fakhurdinova highlighted that, while recent cooperation has accelerated—especially through efforts like the FrankenSAM project, 155mm artillery co-production, and the 2023 Defense Industrial Base Conference—multiple barriers persist:
- Security risks from ongoing Russian aggression continue to deter long-term U.S. and foreign investment.
- Regulatory hurdles, including ITAR restrictions and Ukraine’s own export bans, hamper co-production and tech transfers.
- Corruption perceptions, despite meaningful Ukrainian reforms, remain a concern in Washington.
- Financial limitations, with Ukraine’s government procuring only $6B out of a $20B industrial capacity in 2024, and structural underinvestment impeding rapid scale-up.
- Industrial fragmentation, as many Ukrainian firms remain small, innovative, but uncoordinated—lacking economies of scale for major joint projects.
Priorities for NATO’s Upcoming Defense Industry Forum
Looking ahead, Fakhurdinova urged NATO and EU stakeholders to focus on:
- Strategic alignment between NATO and EU industrial strategies to prevent duplication and reinforce capability.
- Removing procedural and regulatory barriers to spur more joint ventures and pooled procurement.
- Accelerating technology integration, particularly in AI, quantum, and space systems.
- Improving cyber and hybrid warfare resilience, where Ukraine’s battlefield experience provides critical lessons.
- Public-private collaboration, especially through flexible and fast-tracked funding for innovative defense tech.
Ukraine’s Unique Contributions to the Transatlantic Defense Base
Mariana underscored Ukraine’s real-time contributions to transatlantic defense capabilities:
- Combat-tested innovation: Ukraine serves as a proving ground for NATO-standard and experimental systems, driving modernization.
- Emerging tech leadership: Ukraine leads in drones, electronic warfare (EW), and battlefield AI—often outpacing slower-moving Western bureaucracies.
- Agile production: Ukraine offers low-cost, rapid manufacturing in key areas like munitions, EW, and UAVs—complementing overstretched Western supply chains.
- Cyber and hybrid resilience: Hard-won expertise in repelling Russian cyberattacks and disinformation is an underutilized NATO asset.
- Raw material diversification: Ukraine can contribute critical inputs, from lithium and uranium to advanced chips, supporting transatlantic supply chain security.
EU–Ukraine Defense Cooperation: Opportunities and Obstacles
Mariana evaluated the potential and limits of EU initiatives, including the ReArm Initiativehat die Ukraine Support Instrument, and upcoming EDF/SAFE mechanisms:
Opportunities:
- Direct support for key capabilities (e.g., air defense, artillery, UAVs).
- Ukraine’s participation in joint procurement and co-production through SAFE.
- Modernization through integration into EU defense standards and Single Market.
- Public production potential: fixed-price delivery through state-owned enterprises during wartime.
Challenges:
- Lack of implementation clarity in EU proposals.
- Regulatory misalignment between Ukrainian and EU frameworks.
- Export restrictions and financial constraints inhibit co-production benefits.
- National protectionism in EU states risks skewing equitable procurement.
- Ongoing war and infrastructure vulnerability limit industrial scaling.
More details are available via the link: https://cepa.org/transcripts/transatlantic-defense-industrial-strategy/
