Ukraine partners with Europe’s largest arms manufacturer amid Trump's return to power. Serhiy Zgurets’ column

Frontline situation

I congratulate our readers on Unity Day. This national holiday reminds us of the strength of the Ukrainian nation and its ability to stand united. Now, it is critically important to maintain unity between those behind the lines and those on the frontlines, holding positions in extremely challenging conditions along the line of contact and stopping Russian advance on Ukrainian land.

Among all sections of the front line, I would highlight the Pokrovsk direction, where Russian troops are concentrating their greatest forces and resources. Here, the Russian army is currently attempting to break through on the flanks of Pokrovsk, primarily aiming to complicate the supply lines for Ukrainian troops stationed in the city.

Ukraine Russia war live map, January 15-22, Photo: Espreso

There are eight different roads leading to Pokrovsk, with at least four of them, coming from the north and west, being actively and effectively used now.

Regarding the Pokrovsk sector, just two days ago, Russian social media were flooded with claims that two settlements, Udachne and Kotlyne, on Ukraine's right flank, were about to be captured. However, by the next morning, the situation had already changed. This indicates that counterattacks were carried out in these areas. On one hand, the defense in this area is held by the Ukrainian renowned 155th Brigade Anna Kyivska, despite the challenges of forming this brigade. On the other hand, reserves were deployed, including the 425th Separate Assault Battalion Skala, which struck Russian forces near Udachne. Currently, the situation is far from favorable for Russian forces in that area.

We can see that reserves are being used in this direction, and Russia’s advance is being effectively contained. Speaking about the left flank of Ukraine's group, slightly east of Pokrovsk, there is another area where Russian troops are attempting to advance — namely, the settlements near Vozdvyzhenka and Baranivka. In this area, Russian forces achieved some progress, focusing their offensive actions on the Pokrovsk-Myrnohrad-Kostiantynivka highway. This indicates that the Russian army continues to target key logistical routes. It is crucial to find ways to prevent Russian advance toward these logistical routes, as they are essential for maintaining the stability of Ukrainian defense.

Partnership with German company KNDS Deutschland

In addition to forces and means, new equipment and weaponry are critically important to Ukraine. In this context, I want to highlight the announcement about the launch of a joint venture between Ukraine and KNDS Deutschland. This company was initially formed through a merger of French and German firms, creating KNDS. Now, a joint venture has been established to repair armored vehicles and other equipment supplied to Ukraine by KNDS, a joint enterprise in Europe. 

Ukraine's Ministry of Strategic Industries stated that this marks a significant breakthrough in the development of multilateral cooperation. However, there is a small nuance: the Ministry of Strategic Industries had minimal involvement in creating this enterprise. The German side of KNDS Deutschland was the main initiator of the collaboration with Ukraine, partnering with a Ukrainian private company that proved to be a reliable partner for this European consortium.

And why do I speak so confidently about this? Because just a couple of says ago, I had a one-hour conversation with Ralf Ketzel, the CEO of KNDS Deutschland. He mentioned that they were very meticulous in selecting the Ukrainian company to be their partner and were convinced of its capabilities. The name of the company remains undisclosed, as it is considered a critical secret. However, it was revealed that several areas of cooperation will be prioritized.

First and foremost, KNDS Deutschland will focus on assisting Ukraine in repairing Gepard anti-aircraft systems. As we know, these Gepards are actively used on the frontlines to protect critical infrastructure. It's estimated that over 50 of these systems are in use in Ukraine. Now, the Ukrainian company has received the necessary technology, equipment, and licensing. Its employees have undergone training in Germany to ensure effective repairs of the Gepards can be conducted within Ukraine.

Moreover, there are plans to modernize these Gepards using new Ukrainian-developed radar systems, showcasing effective collaboration between the Ukrainian private enterprise and KNDS Deutschland. Ralf Ketzel mentioned that the next step will involve work on the new wheeled self-propelled howitzer RCH 155. As of January 13, the first of these wheeled howitzers was handed over to Ukrainian forces for training and familiarization. For now, it will remain in Germany, where Ukrainian troops will undergo training. A total of 54 howitzers are planned for delivery to the Ukrainian Armed Forces in the future.

Interestingly, the Bundeswehr does not yet possess any of these howitzers, making Ukraine the first user of this advanced system. Ketzel emphasized the importance of incorporating the combat experience of Ukrainian soldiers to refine this system for eventual use in the Bundeswehr.

Additionally, there are other areas of cooperation between KNDS and Ukraine. A comprehensive interview with the KNDS CEO about their partnership with Ukraine will soon be published on the Defense Express and Espreso websites. In the interview, he expresses a high regard for this bilateral collaboration and a strong commitment to sharing technologies. The key is for the Ukrainian side to effectively adopt these technological solutions. With the presence of powerful private enterprises in Ukraine, this partnership is expected to become a successful symbiosis, benefiting both Ukraine and KNDS Deutschland.

Cooperation with American partners after Trump's return to power

In addition to German and European companies, there are, of course, American companies that should also develop cooperation with Ukraine, especially considering the track set during Joe Biden's presidency. We know that there were many initiatives related to cooperation, the creation of joint ventures with American companies, and the allocation of funds for the development of Ukraine's defense industry. The question now is what will happen with these initiatives, whether there will be any changes, and in what direction such changes could go after the new administration and president took office in the U.S. This was discussed by Pavlo Verkhnyatskyi, the director and managing partner of the Ukrainian company COSA.

This company is known for its close cooperation with American defense companies, helping them establish the right conditions for entering the Ukrainian market. I reviewed our archives, and it turns out that in January of last year, we discussed almost the same topic. In January 2024, I asked about the prospects of cooperation with American companies and their approach to the Ukrainian market. Now, a year later, we have a change in the U.S. administration and a new president.

He specifically talked about whether the plans and intentions of American companies to work with Ukraine have materialized, and whether there are new indicators defining changes in the U.S. approach to working with Ukraine under the new administration.

"I think that in this context, we should first outline the actual demands, views, and plans of American companies regarding the Ukrainian market and cooperation with Ukrainian enterprises. The first thing is, of course, not just acquiring advanced technologies, but gaining the experience of war and weapon use in the context of the war. However, it had to do with cooperation, joint ventures, or joint developments. This is what our partners are primarily interested in. From our side, we are interested in the creation of joint ventures with the potential to scale Ukrainian products for supply to the Ukrainian Armed Forces to counter Russian aggression. Ideally, this should be financed by our partners, because a jointly produced product is likely easier to fund by the American side," he said.

At the same time, Pavlo Verkhnyatskyi noted that such cooperation with Americans is currently not very widespread, and there are many reasons for this: "Including issues with technology transfer, if we are talking about American technologies that could be applied in Ukrainian products. To be frank, does Ukraine have any groundbreaking technologies that would be particularly interesting to Americans? Probably some, yes, but it’s not very common. The Americans, with their industry, are also quite capable. They observe how the Russians fight, potentially the Chinese in the future, because everyone is learning now. And they adapt to this experience with their massive development budgets, and so on. Therefore, talking about extensive cooperation, joint production, and so on is probably premature at this stage."

"And regarding changes under the new administration, it’s still too early to say, because, at least as we see it, the projects that were planned or had some level of development are continuing. Whether something new will be created — I think it will, and work on this is underway. Will the new American administration significantly influence this? We’ll see. Traditionally, the U.S. defense-industrial complex supports Republicans, and I think the dialogue will be constructive, including regarding cooperation with our country. So I remain optimistic here," noted the director and managing partner of COSA.

I can’t help but mention the sensational reports in The New York Times and other publications when the Biden administration concluded its term, about how significantly they helped Ukraine in creating drones. Over $1.5 billion, if I’m not mistaken, was allocated for certain drone projects. This was presented as secret assistance to Ukraine.

"Undoubtedly, U.S. assistance has been provided to some extent. We understand that a significant portion of the weapons purchased for Ukraine's Armed Forces were funded, at least in part, with U.S. money. However, regarding support for Ukraine's drone industry, I think it’s more a question of how this assistance is accounted for. This includes specialist visits, the exchange of technological solutions (if it happens), the purchase of Ukrainian-made drones, and investments. Yes, I believe such things have occurred. But it’s worth noting that from the funds mentioned, I think payments could also cover things like people’s travel, hotels, security, and so on. At least, that’s how I see it. In total, of course, it adds up to a significant amount. As for direct investments in Ukrainian drone production, perhaps there were some individual targeted projects, but I don’t believe $2.5 billion was spent on this," noted Pavlo Verkhnyatskyi.

He also emphasized the importance of how Ukraine should currently build its dialogue with U.S. defense companies. Should Ukraine invest heavily in this now, or are the previous agreements sufficient for the current format of defense cooperation between Ukraine and the United States?

"The first thing I would prioritize at the state level is the issue of technology exchange. I won't go into too much public detail, but this is a key priority, and U.S. regulations in this area are very strict. Incidentally, our export control is also quite serious in this regard. However, to accelerate joint projects, I believe this is where efforts should be directed to deepen cooperation. Of course, with a focus on Ukrainian interests — ensuring Ukrainian enterprises have access to certain American technologies and the ability to adapt them for their products here. Additionally, there should be an exchange of experience in the use of weapons to ensure the security of the free world, as grand as that may sound," added Pavlo Verkhnyatskyi, Director and Managing Partner of COSA and co-founder of the Fincord-Polytechnic Science Park.