In the study conducted by the Ukrainian Institute for the Future (hereinafter – UIF) commissioned by and with the direct participation of the Ukrainian Council of Defence Industry (hereinafter – UCDI) an analysis was carried out on the current state and prospects of the international arms and military equipment market (hereinafter – AME), the export potential of Ukraine’s defense industry, and the conditions for its implementation in the context of the Russian-Ukrainian war.

The study focuses on the current state and prospects of Ukraine’s defence exports, taking into account global trends in the arms market and the specific challenges facing the Ukrainian defence-industrial complex (hereinafter – DIC). The study’s results are intended for use by the state’s senior leadership, experts in the DIC sector and related industries, and include key quantitative indicators, facts, conclusions, recommendations, and other information relevant as of June 2025.

The purpose of this study is to provide comprehensive recommendations for the military-political leadership of the state and government bodies, as well as for professionals in the DIC sector, regarding the restoration of the country’s defence exports, ensuring their efficiency, and implementing state support measures.

The object of this study is the international AME market and the conditions for implementing military-technical cooperation projects (hereinafter – MTC) within it.

The subject of the study is the state’s capacity to restore and support defence exports.

Relevance of the study: In the context of a potential ceasefire in the Russian-Ukrainian war and budgetary constraints, a likely reduction in defence procurement by the state will have a negative impact on the DIC sector, particularly on private defence enterprises in the small and medium-sized business category (hereinafter – SMB), which will lose the motivation to remain in the market, especially in terms of R&D and maintaining production capacity. On the other hand, the state aims to retain “mothballed capacity” in the sector in case military actions resume, while having limited ability to finance its preservation, and is also interested in replenishing the budget through taxation, preserving unique defence industry professionals, and maintaining overall employment. In other words, a “vicious cycle” already exists within the DIC’s operations and needs to be “broken.” One of the most viable solutions appears to be the promotion of Ukrainian DIC enterprises/products on the international market, not solely through lifting restrictions on defence exports, but through systemic state support for enterprises in their operations on foreign arms markets, since a single DIC enterprise is often poorly oriented in the complex “rules of the game” within the military-technical cooperation sector. Accordingly, the agenda includes the task of developing and implementing a “Win-Win” format public-private partnership strategy in the field of military-technical cooperation.

The research methodology involved the use of key indicators related to the defence-industrial complex and military-technical cooperation, which had been validated during previous studies conducted by the UIF.

The study employed the following assessment methods:

Statistical analysis – processing data related to market demand, exports, production, financing, etc.;

Expert assessments – evaluations by state officials, military personnel, developers and manufacturers of arms and military equipment, managers and specialists within the DIC sector, and independent experts working in the fields of DIC and MTC;

Assessments of MTC project implementation outcomes, the development of armed forces in various countries, and the use of AME in real combat conditions;

SWOT analysis – identification of strengths and weaknesses of the MTC potential, as well as opportunities and threats;

Comparative analysis – benchmarking against other countries (e.g., MTC practices of NATO/EU member states, China, the Russian Federation, etc.);

Monitoring and analysis of open-source sector-specific information.

Overall, the research is based on the processing and synthesis of open data from the following main types of sources:

Databases and findings from previous studies conducted by the Ukrainian Institute for the Future;

Official sources (Cabinet of Ministers of Ukraine (hereinafter – CMU), Ministry of Defence of Ukraine (hereinafter – MoD), Ministry for Strategic Industries of Ukraine (hereinafter – MinStrategProm), Ministry of Digital Transformation of Ukraine (hereinafter – MinDigital));

Analytical and scientific publications (National Institute for Strategic Studies (hereinafter – NISS), RAND Corporation, SIPRI (Stockholm International Peace Research Institute), Centre for Army, Conversion and Disarmament Studies (hereinafter – CACDS), Jane’s Defence Weekly, etc.);

Sector-specific open sources and media outlets (Defense Express, ArmyInform, The Military Balance, etc.).

The results and conclusions of the study make it possible to:

Ensure the adoption of well-considered and balanced decisions regarding the restoration and support of Ukraine’s defence exports and the implementation of its MTC projects;

Ensure effective state governance in the field of MTC, define and adjust state policy, and plan the development of the DIC sector in the interests of achieving success in the international arms market;

Identify priority areas for the development of innovation, financing, and investment attraction to ensure the success of Ukraine’s defence exports;

Implement appropriate measures for resource mobilisation, staffing, scientific support, educational initiatives, and more in the interests of MTC;

Enhance the efficiency of interaction between DIC enterprises and product consumers in MTC projects.

Authoring team — experts and partners of the Ukrainian Institute for the Future:

Amelin Anatoliy Ihorovych, Co-founder and Executive Director of the Ukrainian Institute for the Future;

Halushko Serhiy Oleksandrovych, Director of Defence Programs at the Ukrainian Institute for the Future;

Here Yuliy Pavlovych, Deputy Minister of Defence of Ukraine for Digital Development, Digital Transformation, and Digitalization (2020–2021), Member of the Supervisory Board of the United Tech Assets Fund;

Yekhanurov Yuriy Ivanovych, Prime Minister of Ukraine (2005–2006), Minister of Defence of Ukraine (2007–2009), Member of Parliament of Ukraine in the 3rd, 4th, 5th, and 6th convocations, Director of the Institute for Advanced Defence Technologies at the National Technical University of Ukraine “Igor Sikorsky Kyiv Polytechnic Institute,” PhD in Economics;

Kyshkar Pavlo Mykolaiovych, Senior Officer of the Command of the Ground Forces of the Armed Forces of Ukraine, Member of Parliament of Ukraine in the 8th convocation, public and political figure;

Lipkan Volodymyr Anatoliiovych, Doctor of Law, Professor, President of the Global Organization for Allied Leadership;

Radchenko Yuriy Andriiovych, PhD in Economics, veteran of the Russian-Ukrainian war, expert in public and military administration, retired colonel;

Romanenko Ihor Oleksandrovych, retired Lieutenant General, Deputy Chief of the General Staff of the Armed Forces of Ukraine (2006–2010), Doctor of Technical Sciences, PhD in Military Sciences;

Fedirko Ihor Olehhovych, Executive Director of the Ukrainian Council of Defence Industry.

Structure of the report based on the results of the analytical study:

Introduction.

1. Executive Summary.
2. International Arms Trade and Ukraine.
3. The U.S. Defense Industry and AME Exports.
4. Development of the Defense Industry and MTC within the EU, NATO, and Individual European Countries. Contributions to EU and NATO Defense as a Window of Opportunity for Ukraine.
5. The PRC: From Priority Partner to Leading Competitor.
6. The Military Industry and AME Exports of the Russian Federation.
7. The Issue of Restoring Defense Exports in the Assessments of Stakeholders, DIC Sector Players, and the Expert Community.
8. Current Demands of the International Arms Market and the Export Potential of the Ukrainian DIC.
9. Risks Associated with Restoring Defense Exports and Ways to Eliminate/Minimize Them.
10. Recommendations for Stakeholders and Proposals for a Roadmap for the Restoration and Development of Defense Exports.

Notes:

1. The main conclusions of the study are presented below. The full report, including its English version, is provided as a separate set of documents available through UIF platforms.
2. The research activities were carried out in compliance with regulations concerning the protection of state secrets and information with restricted access in general, which preclude the inclusion of sensitive data and a number of findings in the report.
3. The study utilized various artificial intelligence (hereinafter – AI) services, particularly for the analysis of input materials and the validation of selected study results. At the same time, all AI-generated content underwent a verification procedure.

KEY FINDINGS OF THE STUDY

1. The global security environment has intensified the need for armed forces to rearm in order to respond to current challenges and ensure readiness for future armed conflict:

The world’s leading militaries are transitioning toward mastering Multi-Domain Operations and their regional equivalents, which require integrated platforms across land, air, sea, cyber, and space domains;

There is a growing global demand for high-precision and long-range strike systems, missile and air defense systems of all types, unmanned platforms, electronic warfare (EW) tools, and autonomous solutions with AI elements — in response to the evolving nature of warfare and armed conflicts;

The importance of C4ISR solutions is increasing (particularly systems/solutions for situational awareness, integrated automated analytics, and battle management systems) to enable effective command and control, ensuring decision-making advantages in timing, accuracy, and overall effectiveness (see “Convergence Doctrine,” JADC2);

Demand has intensified for deterrence and asymmetric response systems — including high-precision anti-tank weapons, structurally simple and low-cost air defense systems, UAVs, counter-drone solutions, mobile EW platforms, and MRAP-format armored vehicles — enabling resource-limited states to conduct effective defense under conditions of enemy numerical superiority;

There is an ongoing exploration of platforms with features such as autonomy, EW resilience, AI integration, and the use of 3D printing for flexible logistics (see “UK Strategic Defence Review 2025”).

2. The above has triggered a significant transformation of the international arms market, both in terms of consumer demands and the conditions of defense exports themselves:

The international arms market has undergone changes due to the full-scale invasion of Ukraine by the Russian Federation and a series of armed conflicts worldwide. Global demand for high-precision, autonomous, and asymmetric weapons has grown substantially. At the same time, a shortage of production capacity — even in leading countries such as the United States, France, and Germany — is opening new windows of opportunity for countries capable of offering modern and effective products grounded in combat experience;

The market in Western countries is expanding (for example, in Europe, there was a +155% increase from 2020 to 2024, and the growth continues);

The EU and the United Kingdom have accelerated the transformation of military potential and the financing of AME procurement (notably through the European Defence Fund, which offers €150 billion in credit lines) for domestic purchases and support of member states’ defense industries;

The United States has announced adjustments to its own armed forces’ rearmament programs while simultaneously maintaining 43% of the global AME export share, which strongly shapes the direction and substance of American foreign policy;

Russia has lost over 60% of its exports in five years, due to its war against Ukraine, the impact of sanctions, shortages of components, and diminished trust in it as a supplier. At the same time, the Russian Federation aspires to regain its market position by leveraging its wartime experience and associated development of new AME models;

China is steadily expanding its presence in the international AME market, displacing Russia in Asian and African markets by offering effective weapons systems, favorable financing terms, and integrated logistics, and is broadly succeeding in intensifying competition with Western countries;

Regarding the nature of AME importers’ demands, there is a noticeable emphasis on key areas where Ukraine already possesses proven solutions and, overall, ready-to-offer products. Ukraine is capable of providing competitive offerings across many segments of weaponry, adapted to real combat conditions.

3. The transformation of the arms market has led to shifts in the actions of key players amid growing competition:

The United States, currently the de facto leading special exporter and a player striving to “set the rules” of the market, promotes standards and monopolistic “terms of play” (notably through customs restrictions and pressured trade agreements), actively counters China’s and other countries’ defense exports, and integrates partners into its production chains (e.g., within the AUKUS framework);

The European Union is pursuing a course toward strategic autonomy, supporting defense consortia, other forms of cooperation, and national initiatives in response to the threat of Russian aggression;

China is intensifying competition with a focus on developing “affordable yet smart weapons” with guaranteed operational support and is actively competing with both Russia and the United States in third-world markets;

In addition to the above-mentioned leading players, the defense industry is also expected to face competition from Poland, Turkey, and South Korea in foreign markets.

Overall, the global arms market experienced significant shifts during the 2020–2024 period. The United States remains the leader, holding a 43% share of global arms and military equipment (AME) exports—outpacing China by a factor of 7.3 and Russia by a factor of 5.5. Russian AME exports declined by 64%, China’s by 5.4%, while U.S. exports grew by 21%. AME imports to Europe increased by 155% due to threats from Russia, indicating rising demand for defense technologies in the region.

4. Historical context of Ukrainian defense exports: Ukraine’s MTC prior to February 2022 includes both successful outcomes and numerous “lessons unlearned,” offering “food for thought” regarding the process and conditions for restoring defense exports:

Ukraine remained among the top 10 special exporters for a significant period (until 2014), primarily due to the “legacy” of Soviet-era arms stockpiles and design-manufacturing capabilities, with minimal investment in their modernization or advancement;

Annual exports exceeded $1 billion, with an order portfolio spanning 4–5 years and valued at over $5 billion;

The primary markets were Asia (45%) and Africa (30%), with key partners including India, Thailand, Algeria, China, and Iraq. The export structure consisted of aviation equipment (43.1%), land systems (36.4%), and air defense systems (10%);

Exports were largely based on Soviet-designed AME—tanks, aircraft, and artillery—offering only short-term benefits;

it is worth emphasizing that, despite the emergence after 1991 of a number of new Ukrainian AME developments for export (as well as deep modernization projects of Soviet-era stock), the bulk of exports consisted of so-called “surplus” AME inherited by Ukraine in 1991 (at best, following repairs and/or minor upgrades). This suggests that the structure of exports had a limited impact on developing the DIC’s long-term potential, creating advanced weaponry, or updating production capacities. In turn, this significantly limited Ukraine’s national capabilities for future MTC once the “surplus” stockpiles were exhausted;

The MTC sphere operated under a “manual control” model and in conditions of virtually no systemic state governance or export strategy;

The private segment of the DIC was only beginning to take shape, while insufficient state support and ineffective coordination between the public and private sectors hindered the development of a unified national export capacity;

Ukraine had limited involvement in joint international AME development and production projects, further complicated by the absence of post-sale support infrastructure and capabilities;

Overall, the once-powerful DIC legacy of 1991 and the level of MTC achieved by early 2022 have been significantly diminished (including the closure of over 70% of DIC enterprises and the loss of cooperative supply chains and MTC partnerships), creating unfavorable conditions for reviving defense exports;

A key lesson from the past is the absence of a systemic and effective national export operator with the authority and expertise to provide comprehensive support for MTC;

The lack of human capital development policies in science, the DIC, and MTC led to the collapse of engineering, manufacturing, and management schools in several fields (e.g., space, missile development, radio electronics, shipbuilding, etc.);

A critical negative factor is the incomplete transition to a modern public-private partnership model in the DIC and MTC sectors, as already implemented in the United States and the United Kingdom.

5. The political decision regarding the restoration of defense exports is on the agenda, and its urgency is increasing:

Without the early reopening of exports (taking into account the long timelines required to enter foreign markets successfully), the private sector of the defense-industrial complex (DIC) may face stagnation in the event of a cessation of hostilities (though not a formal end to the war). Various estimates suggest that only around 20% of enterprises have realistic chances of survival;

Given the budget constraints of the Armed Forces of Ukraine (AFU) in terms of AME procurement, reopening exports would enable DIC enterprises to finance the development of new weapon systems and the expansion of production capacities without burdening the state;

A political decision on defense exports would send a signal to investors and international partners about Ukraine’s consistency, stability, and predictability;

Defense exports have always been a tool of economic diplomacy and alliance-building. Amid instability in assistance from partner states (in what has essentially become a one-sided “game” on their part), joint projects should serve as the foundation for long-term partnerships;

A strong defense industry is one of the few competitive advantages Ukraine will retain after the war—essential not only for the country’s reconstruction and development but also for ensuring its defense capabilities;

The absence of a political decision on defense exports creates a serious national security threat. As of now, 85% of private DIC manufacturers (from the pool of enterprises examined in this study) are either planning to relocate or have already relocated their production abroad.

6. The restoration of exports is one of the key conditions for the future existence and development of defense industry enterprises:

Exports potentially provide access to global markets and resources (contracts, investments, technologies);

It creates motivation for production modernization and the implementation of international standards (NATO, EU, NIST, ISO, etc.), which in turn positively influences Ukraine’s security and defense sector;

It increases the attractiveness of the industry, enhances the potential to attract, retain, and develop highly qualified personnel, and supports the creation and preservation of jobs;

It establishes conditions for expanding opportunities for joint development projects with Western partners.

7. The overall strong export potential of Ukraine’s DIC supports the case for reopening defense exports:

Ukraine possesses combat-verified solutions across a broad range of AME categories that are in demand in international markets — including military-grade artificial intelligence technologies, precision weapons of varying ranges, anti-tank guided missiles (ATGMs), UAVs, loitering munitions, electronic warfare (EW) systems, command and control tools, artillery systems, armored vehicles, and more;

The production capacity of several enterprises significantly exceeds the state’s procurement capacity even under conditions of ongoing war with Russia, enabling the creation of reserves for foreign contracts;

DIC enterprises have demonstrated flexibility, rapid prototyping capabilities, and swift adaptation of production processes, which is a considerable advantage given the dynamic evolution of battlefield needs every 3–4 months;

Over 200 defense companies show strong potential for continued development and are prepared to scale operations in the context of defense exports;

Ukraine enjoys a positive reputation in many global regions, stemming from the legacy of past contracts, the state’s elevated international standing due to its resistance in the war with Russia, and active dissemination of information about Ukraine’s modern AME developments abroad;

Arguably, Ukraine’s most significant competitive advantage in defense exports lies in its extensive network of R&D structures and testing grounds — backed by real military expertise and access to firsthand data from actual combat deployments — allowing for effective vetting and refinement of new products;

Virtually all major international AME manufacturers are seeking access to this expertise and experience to test and improve their own systems, indicating that Ukraine should consider a distinct and competitive export component: the “export of combat experience”;

Another recognized advantage of Ukraine’s DIC is the attractive cost-efficiency ratio of its defense products. Drawing lessons from the Russia-Ukraine war, many foreign customers are pushing their domestic defense sectors to cut costs or entirely rethink procurement priorities. For instance, spending $1 billion on a single warship — which might never leave port due to threats from sea drones or anti-ship missiles like Ukraine’s Neptune — is increasingly being questioned. Instead, the same funds could procure thousands of relatively inexpensive UAVs and maritime drones that would prevent adversaries from achieving objectives in contested maritime zones;

Defense exports offer significant investment appeal. Private investment in defense technologies grew from $5–6.7 million in 2023 to $50 million in 2024, with projections exceeding $100 million in 2025. While exact figures are typically classified, Dragon Capital has publicly announced $100 million in defense investments (primarily in R&D and startups). The authors of this study estimate that actual investment volumes could be roughly double that amount;

As of June 2025, Ukraine’s DIC comprises approximately 800 enterprises capable of producing AME, with an estimated annual production potential of $35–40 billion — although only a portion of this output is likely to be procured by the state. Realistic short-term defense export forecasts range between $1–2 billion. However, the ambition should be to at least return to pre-war export levels — not through repackaged Soviet legacy systems, but through unique, high-tech AME offerings at competitive prices, backed by after-sales service, personnel training, and battlefield integration support;

The structure of potential Ukrainian defense exports can be grouped into three conditional categories:

First, there are AME systems currently meeting modern warfare requirements, actively used in combat, mass-produced, and expected to remain in demand. These include various UAV and loitering munition systems, maritime drones, EW platforms, situational awareness tools, and artillery systems, among others — all with immediate export potential;

Second, Ukraine also manufactures AME designs that may have more limited future relevance in high-intensity warfare due to paradigm shifts, rising competition, or their suitability mainly for low-intensity or localized conflicts. Examples include ATGMs and certain armored vehicles. While still exportable, these systems require further design refinement and a targeted marketing strategy;

Third, Ukraine’s DIC has promising developments in other AME categories currently at the R&D, testing, or limited field deployment stage — often produced in small batches. These are primarily high-precision systems such as ballistic and cruise missiles or select air defense systems. Once they reach the same level of maturity and adoption as the systems in the first group, they too will carry strong export potential.

8. In the absence of a political decision in the near future to restore and support state-facilitated defense exports, a number of risks and negative factors for the defense industry are expected to intensify:

Demotivation of the private sector within the DIC, which could lead to the winding down of initiatives, the halt of development efforts, and the loss of skilled personnel;

Uncontrolled outflow of technologies and innovations to other countries, including the relocation of production abroad — a process already underway, with a high risk of significant acceleration;

Risk of losing market niches in the international arena — competition is intensifying, particularly from strong players such as Poland, Turkey, South Korea, and others;

Conditions will emerge that may lead to a gradual technological lag due to a lack of resources for research and development;

Continued and growing dependence of the Armed Forces of Ukraine on foreign AME suppliers;

Competitors are actively studying and replicating Ukrainian defense solutions and promoting them in the global AME market. As a result, Ukraine risks not only losing revenue and technology but also diminishing its strategic agency, which may reduce the country’s attractiveness as a partner for joint defense projects, and in the eyes of buyers, investors, and international stakeholders.

9. At the same time, there is an ongoing discussion about risks of an opposing nature — specifically, the potential consequences of granting Ukrainian manufacturers formal permission to export AME without accompanying state oversight and support:

Concerns are raised about reputational/image-related issues in relations between the state and both the public and international partners, especially in light of the insufficient supply of AME to frontline needs and Ukraine’s ongoing appeals for foreign aid;

A potential conflict of interest is anticipated between the state and manufacturers within the “export contracts vs. meeting AFU needs” paradigm;

There is a risk of technology leakage due to imperfect MTC oversight mechanisms;

Reputational and strategic damage may arise if Ukrainian weapons end up in the hands of hostile states or the aggressor country;

Excessive focus on export contracts — which may appear more attractive — could divert private sector attention away from national defense priorities;

The state may have limited capacity to accompany or support AME exports due to the priority of addressing its own defense readiness;

Recipient countries may apply political or other forms of pressure in cases of instability or disruptions in contract execution.

10. At present, the following appear to be the main mechanisms for mitigating or eliminating the risks outlined above:

Communication and diplomatic support for the issue of defense exports in the event of a decision to authorize them;

Regulatory establishment of AFU needs as a formal priority over export projects, with clearly defined enforcement mechanisms;

Implementation of modern end-user control mechanisms (“end-use monitoring”);

Export restrictions on critical technologies and AME systems through individual licenses and authorizations;

Execution of exports to countries with relevant international commitments and to those with which Ukraine has signed security agreements, etc.;

Regular monitoring of partner countries’ defense policies.

11. At present, several options for reopening defense exports are under discussion, the main ones being:

Pilot projects for opening exports of specific AME categories (for example, UAVs or spare parts/components for military transport aviation, where there are no foreseeable state procurement plans);

Issuance of one-time permits for specific MTC projects;

Export authorization conditional upon the enterprise supplying at least 50% (as an example) of its production to meet the needs of the Armed Forces of Ukraine, provided alternative suppliers exist for the domestic customer;

Export licensing based on national priority categories and defined AME nomenclature;

Creation and development of joint production clusters (Joint Ventures) with partner countries;

State-controlled integration of Ukrainian manufacturers into national rearmament programs within the EU.

Additionally, a model is being discussed under which special taxes would be introduced for defense exporters. While this approach includes several contentious aspects and raises concerns, it remains on the list of potential options. The state justifies this measure as a means to raise funding for the production of AME for AFU needs. On the other hand, manufacturers view such a decision as narrowing the window of opportunity for successful defense exports. This approach would also require the state to establish a separate mechanism for collecting such taxes.

12. It is evident that the formal reopening of exports alone will in no way guarantee 100% success for individual DIC enterprises. Entry into the international market requires significant preparation on the part of the potential defense exporter, as well as a comprehensive set of state-level measures to support MTC efforts:

The international AME market operates under its own rigid rules (shaped by political and security factors, often amid unfair competition), which must be understood in advance, continuously monitored, and accounted for in building the capacity to succeed;

The state must provide timely and professional support for MTC projects in the form of diplomatic, foreign economic, intelligence, informational, and legal assistance, among others;

The key condition for success is the creation and implementation of a system of state guarantees and insurance mechanisms for MTC contracts;

Success in defense exports requires manufacturers to be prepared to operate within the legal frameworks of importing countries, obtain necessary licenses, and comply with certification standards (such as ISO, AQAP, STANAG, etc.);

Successful MTC projects involve not only the supply of AME batches but also the development of export logistics (maintenance bases, spare parts, technical support, etc.) and personnel training.

13. In the event of a political decision to authorize defense exports, along with the definition of implementation mechanisms and state support for MTC, as well as the elimination or mitigation of related risks, significant benefits are projected for the state and the AFU:

Preservation and development of the national DIC as a system-forming element of strategic autonomy and national power;

Promotion of Ukraine’s interests globally and the shaping of the country’s image as a reliable technological partner;

Increased budget revenues, additional funding for defense needs, and reduced tax pressure;

Development of human capital and the creation of jobs in high-tech sectors of the economy;

Joint projects with partner countries as a means of strengthening international ties and security alliances;

Technology exchange within the framework of joint initiatives.

14. The minimum necessary measures for state support of defense exports include:

The development of a defense export policy/strategy and the political will for its implementation (including the creation of a defense/military export policy and strategy, military-technical policy/strategy, military-industrial policy/strategy, and military-scientific policy/strategy — particularly in relation to AME development, critical technologies, innovation, etc.). A broader framework, such as a “security export policy,” may also be considered;

Regulatory definition of the above at the level of Ukrainian legislation, presidential and government acts, as well as relevant implementation programs, roadmaps, and action plans;

Centralized leadership and coordination of the defense export domain at the level of the President of Ukraine, National Security and Defense Council , and Cabinet of Ministers of Ukraine, including the creation or designation of a single MTC operator;

Systematic and ongoing support for the implementation of the export strategy, including diplomatic, intelligence, legal, informational, and other instruments;

Institutional and other forms of support for the R&D network (including through a dedicated defense export fund);

Introduction of a special legal regime for defense investors, and, as an option, the creation of a support center — a conditional “Defence-Tech Investor Office” (DTIO) — to assist with licensing, certification, export controls, NATO and EU standards, and more;

Educational programs for top management/owners of DIC enterprises and MTC professionals.

In general, the state must master the transition in strategic priorities from “export of AME” to “export of security,” while preventing a regression to the level of “export of technologies and intellectual property.”

Ukraine should begin offering clients comprehensive solutions in the form of services from private military/security companies capable of executing turnkey security operations. Following the end of the war or cessation of hostilities, the country’s ability to deliver such services will increase dramatically. Still, to ensure the success of these projects, the state would be wise to begin establishing the necessary regulatory, organizational, and institutional foundations now.

15. For defense companies — particularly privately owned businesses and SMEs — aiming to enter the international AME market, it is essential to proactively implement a set of measures that create operational conditions and mitigate risks at the so-called “entity level”:

Transformation of the company’s management practices toward building the capacity to operate effectively in foreign markets;

Ensuring the presence within the team of specialists and expertise in foreign economic activity (hereinafter – FEA) and, if necessary, government relations in the country or countries of export interest; analytical support with business intelligence capabilities; legal support focused on international law, FEA, and intellectual property; communication support for the company’s operations, including engagement with the information environment of countries or regions targeted for export contracts;

Organizing the creation and promotion of export versions of products, taking into account certification requirements, compliance with customer standards (of specific countries, NATO, the EU, etc.), logistics, and life cycle support for AME systems;

Conducting early transformation of the current business model into one that supports the production and promotion of dual-use or civilian-purpose products based on the needs of foreign markets;

Creating conditions for attracting investment, including transitioning from “Battle-Proven” to “Investor-Ready” status;

Considering the possibility of creating or participating in partnership initiatives (alliances, associations, clusters, even public organizations) to advance/protect common interests and engage in “complementary cooperation”;

Elevating the customer offering to a new level — beyond promoting individual AME units — by including value-added services such as life cycle support, product line updates, documentation, personnel training, etc.;

Implementing communication strategies to support operations and build/maintain reputation;

Participating in defense exhibitions, product demonstrations/testing, conferences, and maintaining presence in the information and media space overall.

16. In conducting the research related to foreign countries (Sections 3–6), the authors were guided by the following considerations:

The experience of state support for the MTC sector in countries that are leading players in the international arms market is valuable for analysis and should be taken into account as Ukraine develops and implements its own defense export policy;

These countries are simultaneously competitors to Ukraine in regional AME markets, necessitating a clear understanding of the conditions under which competition takes place;

At the same time, analyzing foreign defense exporters helps identify “windows of opportunity” for establishing partnerships (particularly with the EU, United States, United Kingdom, etc.) and implementing joint projects in third-country markets;

Understanding the offerings of leading exporters — including the range of military and dual-use products, supply terms, and after-sales support — enables Ukrainian special exporters to identify market niches and shape their own competitive offer packages accordingly.

17. Ukraine’s future as one of the world’s leading and successful nations should be based on leveraging several of its competitive advantages in international markets:

Technologies and developments in the field of digital transformation;

Agricultural technologies, particularly the production and export of environmentally friendly products;

Defense technologies, including the use of MTC mechanisms for their promotion. One possible approach is to offer international partners security technologies in a broad sense;

technologies in education, science, and innovation.

Thus, Ukraine’s defense-industrial complex holds significant export potential, positioning the country as a global leader in innovative defense technologies. However, realizing this potential requires political decisions, systemic reforms, integration into the global market, and support from investors. Export can become a key driver of economic growth, but success will depend on overcoming obstacles such as bureaucracy, competition, and a shortage of qualified personnel. The recommendations presented aim to create a favorable legal environment, strengthen international cooperation, and enhance strategic communication — all of which are crucial for ensuring national security and the state’s economic development.