A worker in the state-owned armament enterprise VMZ-Sopot in Bulgaria. Photo: VMZ website.
With the promise of “next-generation technology” and the creation of more than 1,000 jobs, Bulgaria and leading German defence company Rheinmetall sealed plans on Tuesday to build a new arms plant in the town of Sopot, Bulgarian media reported.
The site, which is expected to become operational in 2027, will focus on manufacturing gunpowder and 155-mm NATO-standard artillery shells. The project is valued at 511.3 million euros, with the German company holding 51 per cent of the shares in the joint venture.
Bulgaria will finance its participation through a loan of more than 400 million euros under the EU’s SAFE mechanism, which was set up to boost defence industrial production in Europe.
The deal was signed in the presence of Prime Minister Rosen Zhelyazkov, Rheinmetall’s CEO, Armin Papperger, and the main collaborator, the state-owned armament enterprise VMZ-Sopot’s executive director, Ivan Getsov. The new plant will be built next to the existing plant of VMZ-Sopot, and is touted to become a major supplier to NATO and EU countries.
“We’d like to increase the capabilities not just in terms of artillery but also in other exciting areas, for example Bulgaria has also capable engineers and technicians. But first we have to learn to walk, then to run,” Rheinmetall’s Armin Papperger said on Tuesday at the Regional Defence Summit in Sofia. He added that a ten-year development plan includes increased digitalization of the processes and balancing local needs and exports.
“We’re all for peace and we’re not preparing for a war but we would like to have better defence industry and army which will not allow anyone to intimidate us,” GERB leader Boyko Borissov said at the same event, adding in his trademark informal style: “For example, in my childhood, I studied karate to scare away the hooligans that wanted to beat me up. Are we ready for the hooligans of the present day? Right now, we’re not.”
In September, European Commission president Ursula von der Leyen visited the factory in Sopot, braving pro-Russian protesters and amid speculation about suspected Russian interference with the GPS navigation at Plovdiv Airport where her plane landed. “At the beginning of the [Russia-Ukraine] war, one-third of the weapons used in Ukraine were coming from Bulgaria,” Von der Leyen noted at the time.
While Bulgaria was initially hesitant to donate military aid to Ukraine, the 2021-22 government of Kiril Petkov and We Continue the Change quietly supplied the Ukrainian army through third-party countries, while maintaining a shaky coalition government with the pro-Moscow Bulgarian Socialist Party.
For the factory in Sopot, created in 1936, the search for an investor of this size has been a long-time coming. The company, once at the heart of Bulgaria’s multi-billion-dollar arms industry, has faced a deteriorating financial situation.
In July, Rheinmetall also expressed interest in expanding its activities in Romania, more specifically in the production of Lynx fighting vehicles.
