Markets 
In a much anticipated step, Ukraine is opening up its arms exports to global markets, President Volodymyr Zelenskyy announced on Tuesday evening.
“The export of Ukrainian weapons will become a reality, we have approved all the details at the level of our state institutions,” Zelenskyy said in a statement.
“Currently, our security expertise and weapons, which have been tested in modern warfare, are of interest to all partners capable of ensuring a real level of protection for their statehood and the lives of their citizens.”
Zelenskyy clarified that exports will be open to countries that have supported Ukraine and will take the form of so-called “Drone Deals.”
These are special agreements on both the production and supply of Ukrainian drones, missiles, ammunition and other in-demand types of weaponry, military equipment and software, as well as the “provision of our expertise and the technological exchange needed by Ukraine.:
Zelenskyy said also that he approved on Tuesday “the areas for this interstate work and the development of automatic permits for businesses regarding arms exports.”
“The algorithm is absolutely clear: at the interstate level, based on the principle of reciprocity, we define the framework for security cooperation through the relevant agreement.”
Then the process continues at the level of state institutions and manufacturers. In order to streamline exports, Kyiv will simplify bureaucratic procedures, “maintaining an adequate level of export control, and launching practical operating mechanisms for companies.”
Controlled export
Both Ukraine’s foreign partners and domestic weapons producers have been waiting for Kyiv to open up an arms exports procedure.
Approximately 800 arms producers are currently operating in Ukraine and many of them have ramped up their production to a significant surplus.
According to the most recent reports, Ukraine is now producing over 4 million drones annually and could double that number with sufficient funding.
Domestic arms producers had been asking Zelenskyy for a year to lift restrictions on selling their domestically-produced military-grade equipment, particularly drones, to generate more revenue.
For over half a year, Kyiv had been working on what it had defined as the “controlled export” of weapons.
On Tuesday, Zelenskyy said with the clear export structure Ukrainian companies “will receive a real opportunity to enter partner countries’ markets,” but pointed out that the Ukrainian military will get absolute priority in terms of supply needs.
“A surplus of production capacity in Ukraine for certain types of weapons reaches 50% and this is a direct result of our state investment in Ukraine’s defence industry and our cooperation with partners.”
Another condition is that only those countries who have supported Ukraine since the beginning of Russia’s full-scale invasion in 2022 will have the opportunity of getting a piece of its battlefield-tested arsenal.
Zelenskyy said he instructed the Foreign Ministry together with the intelligence services and Ukraine’s Security Service (SBU) to determine the list of countries “to which exports of our weapons are not possible due to their cooperation with the aggressor state.”
“This is a serious challenge – to prevent our technologies and weapons from falling into Russian hands,” he said.
Gulf region first in line
Zelenskyy confirmed that the format of “Drone Deals” has already been implemented by Kyiv in its cooperation with countries in the Middle East, the Persian Gulf, Europe and the Caucasus.
He also confirmed that Ukraine has “a proposal on the table with American partners.”
“The terms must be favourable to Ukraine, there must be clear oversight, and the proceeds from exports must help Ukraine defend itself. That is exactly how it will be.”
Kyiv recently signed 10-year defence partnership deals with three Gulf countries, which include maritime drones, electronic warfare and interception technology.
Ukraine’s naval drone fleet has been expanding in recent years and Ukrainian sea drones have proven effective in inflicting heavy losses on Russian military sites and ships in the Black Sea, such as the Magura-V5 drones, which have been used to target the Russian fleet.
Some of these systems can help unblock the crucial Strait of Hormuz, Zelenskyy said in March.
Ukraine is also trying to use the momentum of the Iran war and the escalation in the Middle East as a window of opportunity to strengthen its geopolitical role and transition from a recipient of security aid to a provider.
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