Ukraine’s Cabinet of Ministers has approved a new program aimed at providing preferential loans to defense manufacturers, a move designed to expand production capabilities and strengthen supply chains critical to the country’s frontline needs.
Ihor Fedirko, Advisor to the Minister for Strategic Industries of Ukraine, announced the approval, highlighting the program as a major boost for the sector.
The initiative allows defense manufacturers to access loans at a reduced interest rate of just 5%, with the government covering the majority of the interest costs. Companies can apply for working capital loans of up to UAH 100 million with a three-year term, or for investment project loans of up to UAH 500 million with a term of up to five years. The government has allocated UAH 263.4 million for this program through the end of the year.
He emphasized that this achievement is the result of coordinated efforts among the Ministry of Strategic Industries, the Ministry of Finance, the Ministry of Economy, parliamentary committees, the National Bank of Ukraine, and the Enterprise Development Fund.
The funds will support the development, production, repair, and modernization of weapons, military equipment, munitions, and other critical resources. Eligible companies must be recognized as critical to the economy by the Ministry of Strategic Industries during this exceptional period.
The preferential loan program is designed to facilitate growth and innovation within the defense sector, reinforcing Ukraine’s commitment to strengthening its military capabilities amid ongoing challenges. By easing financial constraints, the initiative aims to enhance the efficiency and capacity of defense manufacturers, ultimately supporting the country’s broader security strategy.
Access to affordable financing is expected to empower manufacturers to meet increasing production demands, modernize their facilities, and develop advanced technologies. This targeted investment reflects Ukraine’s strategic approach to building resilience and maintaining robust defense capabilities.