Neighbors in Arms

Summary 

The EU and Ukraine are in a time-limited window to achieve their defense-industrial integration. Ukraine’s wartime production base has expanded significantly since 2022, while the EU has developed a defense policy and financing toolkit that combines long-term industrial integration, capability development, and crisis-response support. The new EU instruments treat Ukrainian firms on equal or near-equal footing with other European entities for procurement and funding purposes—a level of formal access earlier EU frameworks did not provide. However, converting that access into practical integration will depend on action at the level of the EU institutions, the member states, and Ukraine’s government. This evolution in the EU, combined with Ukraine now being firmly on the accession path, opens up a logical next step for Ukraine’s defense-industrial sector: translating its unprecedented wartime growth into deeper integration with the EU’s defense-industrial base. 

This paper reviews the EU’s most recent defense-industrial policy developments, including the shift from fragmented coordination to large-scale defense-sector mobilization through the evolution of its policy and financing toolkit. It also shows the unprecedented access for Ukrainian firms to new EU frameworks. However, there is a structural asymmetry between EU-level eligibility and national-level implementation. The EU sets participation rules but procurement decisions, certification requirements, and security clearances remain the domain of individual member states. If they default to protectionist or nationally concentrated procurement strategies during the current rearmament wave, Ukrainian firms risk structural marginalization despite their formal inclusion in EU frameworks. The same will apply if Ukraine’s government is too late in lifting its export controls. To achieve the win-win cooperation that will strengthen defense autonomy for the EU and Ukraine, several steps are needed.

At the EU level, the EU–Ukraine Task Force on Defence Industrial Cooperation should be used as a standing platform to track which member states include Ukrainian firms in procurement and joint ventures, with senior representatives from national procurement agencies added to it directly, and with funding made available for technical assistance to Ukrainian firms on certification, security clearance, and joint-venture preparation.

Member-state governments should identify specific capability areas open to Ukrainian participation, communicate procurement needs early enough for Ukrainian and domestic firms to prepare jointly, and extend national guarantee or insurance instruments to cover co-production and joint-venture investment with Ukrainian partners.

In Ukraine, regulatory predictability, certification alignment, and intellectual-property safeguards are essential to reduce risk in investment by and collaboration with EU firms. A controlled allowing of exports of defense technologies at the core of the approach. Ukraine must do it now, not after the war, while its firms enjoy greater local demand and investments, giving them a solid domestic foundation from which to enter EU markets. The opportunity must be seized because the window for defense-industrial integration between the EU and Ukraine will narrow as procurement cycles and industrial partnerships solidify over the coming years.  

Maria Repko is a ReThink.CEE Fellow 2025 of the German Marshall Fund of the United States (GMF).

The views expressed herein are those solely of the author(s). GMF as an institution does not take positions.