EU close to €2 billion ammunition deal for Ukraine but doubts remain over ability to deliver on time

European Union foreign and defence ministers are on Monday expected to approve a €2 billion plan to boost ammunition deliveries to Ukraine including through joint purchases although some differences over how to achieve that remain.

The three-track proposal ministers are discussing would see member states commit €1 billion worth of ammunition from their remaining — but quickly depleting stockpiles under track one — then place joint orders for an additional €1 billion under track two. 

Ukraine roughly needs 1 million ammunition rounds, primarily the 155 mm kind, over the next year. 

EU ambassadors reached the basis of a political agreement on Sunday but some sticking points still need to be hammered out: whether to allow ammunition purchases from non-EU manufacturers and who should conduct negotiations for joint purchases.

“I hope that the ministers will, all of them, engage in a final discussion and agree on and very important decision for this afternoon. Otherwise, we will be in difficulties in order to continue supplying arms to Ukraine,” High representative Josep Borrell told reporters upon arrival at the meeting on Monday.

‘Force majeure’

Joint procurement is seen as the best way to boost production in the short term and increase the long-term capacity of the European defence industry — the proposal’s third track — as quickly and as cheaply as possible.

Currently, two ways to buy jointly are envisaged.

The first is through the European Defence Agency (EDA) which would fast-track orders for 155 mm ammunition by calling it a case of “force majeure”. This would allow it to start negotiations with the industry without first putting out a call for tender.

Fifteen member states have already committed to going through the EDA, Borrell said on Monday.

The second option on the table is for joint purchases to be done through consortiums of member states composed of at least three countries with one nation leading the negotiations. Germany has already indicated it would open up its procurement projects to other member states.

An EU official close to the negotiations insisted last week that the two systems could be complementary.

“What we want is to have economies of scale to be in a better position to negotiate with the industry. If we have 20 member states who buy separately, it’s not a good negotiation for them when they have to face the industry. 

“That’s why we want to have a massive demand. And so we think that if at least three member states work together and if one member state as a role of leader, as a nation to procure on behalf of these three at least three member states, I think it’s better,” the official said.

‘Very ambitious timeline’

It is unclear however how much ammunition EU countries can provide Ukraine in the coming months from their own stockpiles and whether the bloc’s industry can produce the rest on time. 

The EDA is reportedly on track to place the first joint orders by the end of May, according to an official, which described it as “a very ambitious timeline, but at the same time realistic.”

The average delivery time currently is just over 12 months, but the hope is that by placing large orders, the industry can rise up and significantly reduce that timeframe.

The European Commission previously estimated that production capacity could grow by at least 17% in a year. 

And EU officials insist the bloc is well-placed with 15 companies across 11 member states that are able to produce the Soviet and Western-style ammunition Ukraine needs.

Asked about whether the EU can meet Ukraine’s demands, Borrell also sounded upbeat on Monday, telling reporters: “I am confident, certainly because I am not an optimist. I am an activist.”