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EU One Step Closer to Boosting Ammunition, Missile Production

The Council of the European Union (EU) and the European Parliament reached on Friday a provisional agreement on the Act in Support of Ammunition Production (ASAP), aimed at boosting the production of ammunition and missiles in the EU to the benefit of the member states and Ukraine.

Under the agreed regulation, 500 million euros (545.3 million U.S. dollars) will be urgently mobilized from the EU budget to support the ramp-up of the manufacturing capacities for the production of ground-to-ground and artillery ammunition as well as missiles, according to the Council.

The agreed rules include an instrument providing financial support through grants for the EU industry to reinforce its ammunition and missile production capacities throughout the supply and value chains. It will also help avoid bottlenecks and shortages.

A so-called “Ramp-up Fund” will assist the ammunition and missile supply chains in gaining access to both public and private financing, the Council said.

The provisional agreement now needs to be endorsed by both the Council of the EU and the European Parliament before formal adoption. Signature and entry into force is expected before the end of July, according to the Council.

The conflict between Russia and Ukraine and the EU’s continued military support to Ukraine have exposed the European defense and military equipment market to challenges.

On March 20, the Council agreed to provide 1 million rounds of artillery ammunition for Ukraine in a joint effort within the next 12 months. It agreed to urgently deliver ground-to-ground and artillery ammunition to Ukraine and, if requested, missiles from existing stocks or the reprioritization of existing orders. It further called on member states to jointly procure ammunition and, if requested, missiles from the European defense industry and Norway. (1 euro = 1.09 U.S. dollar)

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