VILNIUS, Lithuania — Lithuania and a Ukrainian defense manufacturer signed an investment agreement Friday to build an ammunition plant in the Baltic country that will produce munitions meeting NATO standards, the Lithuanian government said.
Economy and Innovation Minister Edvinas Grikšas and Yevhen Muzykin, director of the Dnipro Energy and Mechanical Plant, known as DEMZ, signed the deal in Vilnius, according to the Lithuanian broadcaster LRT and the news site Delfi.
An assembly workshop will be built in the Prienai district, near Balbieriškis, while metal components for the munitions will be produced at the Alytus Industrial Park. The project is expected to create up to 450 jobs across the two areas. Construction is scheduled to begin this autumn, with production starting at the end of 2027.
The output is intended primarily for Ukraine's armed forces, with allied defense needs as a secondary market. The government did not disclose the total investment or the specifications of the ammunition.
Prime Minister Mindaugas Sinkevičius said the defense industry is the main pillar of the country's ability to protect itself, and that staying safe requires investing in that industry now.
Lithuanian officials said the project is also meant to increase shell supplies for Ukraine's military and to bring Ukrainian defense technology into the country's industrial base.
The agreement comes as European governments work to expand munitions capacity. NATO members agreed at the Ankara summit in July to build up forces on the alliance's eastern flank, and in the summit declaration allies pledged 70 billion euros in military equipment, assistance and training for Ukraine in 2026.