Bulgaria has signed a major defense agreement with German arms manufacturer Rheinmetall to build a new ammunition production facility, Reuters reported on October 28.
The deal, valued at over $1 billion, aims to boost the region’s defense capabilities amid Russia’s ongoing war in Ukraine.
According to Reuters, the facility will produce gunpowder and 155mm artillery shells. It will be developed as a joint venture between Rheinmetall and Bulgarian state-owned arms producer VMZ, with the German company holding a 51% stake and VMZ 49%.
Bulgaria will finance its share of the project through a loan under the EU’s SAVE initiative, which supports increased defense investment across member states.
The agreement was signed at the Council of Ministers in Sofia by Rheinmetall CEO Armin Papperger and VMZ Director Ivan Getsov.
“This agreement marks the beginning of a strategic partnership between the Bulgarian state and a leading German technology group — one that will reshape the future of Bulgaria’s defense industry,” Bulgarian Prime Minister Rosen Zhelyazkov said.
Papperger stated that the plant is expected to be completed within 14 months. “Bulgaria is moving at an unprecedented pace. With just our second meeting, we are launching one of the most advanced facilities in Europe,” he said.
The Bulgarian government told Reuters that the project is expected to create around 1,000 jobs and help revive a key part of the country’s defense manufacturing sector. In addition to artillery shells, the plant will produce gunpowder and advanced modular charge systems.
Reuters also noted that Rheinmetall is expanding across Europe to meet increasing demand for ammunition. The company has formed strategic partnerships with defense leaders such as Italy’s Leonardo and US-based Lockheed Martin.
Earlier, it was reported that European missile manufacturer MBDA is preparing to expand production of Patriot missiles at a new facility in Germany and says it is ready to build Patriot launchers as well.
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