15 September 2024

Ukrainian Defense Minister Rustem Umerov: Ukraine Defense Industry Production could Increase 3x with Additional Foreign Funding

The article concludes with a stark warning: 
“Management chaos always leads to defeat. 
In the Ministry of Defense of a warring country, this can lead to the defeat of Ukraine.”
  • The authors stress that while they have only covered three key areas in their critique, the management chaos affects nearly all critical areas of the defense ministry’s operations.

With investments, the potential of the Ukrainian defense industry could reach $20 billion 

Umerov

Sunday, September 15, 2024, 10:53 - 
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Ukrainian Defense Minister Rustem Umerov noted that the potential of the Ukrainian defense industry allows for a significant increase in production, but this requires foreign investment.


About it he stated during a panel discussion at the Yalta European Strategy forum.
Umerov noted that in 2023 the production potential of the private and public sectors of the defense industry amounted to 7 billion dollars. 
According to the Minister, in 2025 this figure could increase threefold.
"In 2025, we can increase this figure (the potential of the defense industry - the EP) three times. 
According to our estimates, with additional funding, the potential for defense production could reach $ 20 billion,
– said Umerov.
According to Umerov, the capabilities of Ukraine's defense industry far exceed the amount of investment that the country is able to provide on its own.
Umerov: Ukraine to triple defense production by 2025 | УНН
Let's remind:

Government predicts slowing GDP growth, rising average wages and inflation, and reducing unemployment in 2025.

Ukraine’s defense ministry under fire for “management chaos” a year after leadership change
Despite initial optimism, Ukraine’s defense sector under Minister Rustem Umerov grapples with procurement inefficiencies, international cooperation failures, and a lack of strategic planning, according to a critical report by civil society leaders.
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Ukraine’s Defense minister Rustem Umerov and ombudsman Dmytro Lubynets. Photo: the Defense Ministry
Ukraine’s defense ministry under fire for “management chaos” a year after leadership change
Source:Summarized from Ukrainska Pravda


A year after Rustem Umerov’s appointment as Ukraine’s Minister of Defense, which was initially welcomed by civil society organizations, a scathing critique of the ministry’s operations has emerged.

The report, published by Ukrainska Pravda on 6 September 2024, and authored by prominent civil society leaders Daria Kaleniuk, Maria Berlinska, and Alyona Getmanchuk, outlines systemic failures in key areas of defense management and paints a picture of a ministry struggling with inefficiency and disorganization.

The authors recall the high hopes that accompanied Umerov’s appointment on 6 September 2023. He replaced Oleksii Reznikov, who had been badly affected by two corruption scandals and routinely targeted by a large-scale disinformation campaign.
The report delves into three critical areas where the ministry has fallen short:overal
management structure
defense procurement
international cooperation.
Regarding the ministry’s structure, the authors argue that despite Umerov’s stated priority of rebuilding the ministry’s role in coordinating all defense forces, little progress has been made. They state, “the Ministry of Defense still remains a ministry subordinate to the Armed Forces, and the minister himself does not dare to make decisions that may not be liked by the General Staff.”
This lack of clear leadership and coordination is seen as a fundamental flaw in the ministry’s operations.


In the realm of defense procurement, the article notes some positive developments, such as the creation of the State Tail Operator (DOT) and the Defense Procurement Agency (AOZ). These agencies have shown promise in reducing corruption and achieving significant savings in defense budgets.

However, the authors point out persistent issues, including overlapping responsibilities and delays in the procurement cycle. They state
, “As of August 2024, the list on the basis of which the Defense Procurement Agency has the right to buy weapons and other equipment for the army is formed after consultations with the General Staff by the discredited Department of Military Technical Policy (DVTP).” This department, they note, has been involved in questionable procurement practices in the past and continues to wield significant influence.

International cooperation is described as a “total failure” in the article
The authors claim that “the delay in establishing international cooperation, namely the elementary absence of a profile deputy for eight months and, accordingly, professional coordination of work on international military assistance, cost [Ukraine] billions of dollars in aid for weapons.”
They point out that the ministry lacks basic internal expertise regarding foreign military aid budget programs for Ukraine, contrasting this with Israel’s defense ministry, which employs over 100 top specialists to manage US military aid alone.
A critical issue highlighted in the report is the absence of a realistic war plan coordinated with all defense forces and effectively communicated to international partners.
The authors state, “The main problem of the failed international work of the Ministry of Defense is the absence of a realistic war plan formed in coordination with all defense forces and qualitatively communicated with international partners.” This lack of strategic planning and communication has reportedly led to unrealistic requests for equipment totaling trillions of dollars, which partners cannot fulfill due to lack of available stock or production capacity.

The report also criticizes the ministry’s approach to international relations, particularly its focus on Türkiye at the expense of relations with the United States. The authors note that while the minister has made multiple trips to Ankara, the ministry has failed to effectively engage with US defense procurement programs such as Foreign Military Sales and Foreign Military Finance, which could provide significant benefits to Ukraine.

Despite these criticisms, the authors acknowledge some achievements under Umerov’s leadership.
They note significant progress in army digitalization, describing it as a “colossal leap” that puts Ukraine ahead of most NATO armies in this area.
They also commend the initiation of dismantling Soviet-era paper reporting and excessive bureaucracy, and the launch of procurement agencies that have already significantly reduced corruption margins.

However, the authors argue that these successes are insufficient and at risk due to the overall management issues.
  • They point out that even positive initiatives, such as the effectiveness of the Defense Procurement Agency, are being undermined by the minister’s failure to appoint its supervisory board for two months.
The article concludes with a stark warning: “Management chaos always leads to defeat. In the Ministry of Defense of a warring country, this can lead to the defeat of Ukraine.”
The authors stress that while they have only covered three key areas in their critique, the management chaos affects nearly all critical areas of the defense ministry’s operations.


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