Ministry of Defence wants to attract private investment for construction of underground defence industry plants
The Ministry of Defence of Ukraine is working to establish a systematic mechanism for developing a secure production infrastructure for enterprises in the defence industry.
This is stated on the website of the Ministry of Defence, according to Censor.NET.
Simplifying the construction of underground facilities
- It is noted that the proposed changes are intended to simplify the construction of underground production facilities and create opportunities to attract private capital, developers and investors to such projects.
In particular, one of the key elements of this work is the amendments to Resolution No. 1494 of the Cabinet of Ministers of Ukraine. These are intended to establish specific legal conditions for the construction of underground production facilities, as well as surface infrastructure that is technologically and functionally linked to them.
"Our task is to create conditions under which Ukraine’s defence industry can both expand and become more secure. To achieve this, we need to draw not only on state resources and those of the defence industry enterprises themselves, but also on the capabilities of private capital, property developers and the construction market," said Anna Gvozdiar, Ukraine’s Deputy Minister of Defence.
The draft amendments have already passed the main stage of inter-ministerial review. The document is currently being finalised in the light of the findings of legal and anti-corruption reviews, prior to its submission to the Cabinet of Ministers for consideration.
Attracting investors and property developers
Under the proposed mechanism, the client commissioning the construction of secure production facilities may be not only a defence industry enterprise, but also another legal entity – in particular, a property developer or an investor.
Such a client will be able to construct a facility, using their own or borrowed funds, for subsequent transfer to a defence industry enterprise, either as a transfer of ownership, a lease or a right of use.
"This will enable non-budgetary resources to be channelled into the creation of a secure defence infrastructure. At the same time, the implementation of the mechanism itself does not entail any additional expenditure from the state budget," the Ministry of Defence states.
Furthermore, it is proposed to enshrine the concept of an underground industrial infrastructure facility in legislation and to extend the simplified mechanism to above-ground structures and structural elements that are technologically and functionally linked to such a facility.
The Ministry of Defence expects that the new mechanism will enable the faster establishment and expansion of secure production facilities, simplify the relocation of defence industry production facilities, and help to attract private investment and develop the market for underground industrial construction in Ukraine.
