Amidst the ongoing conflict and the critical need for modern surveillance and strike capabilities, Ukraine has received a significant authorization from the European Union. Kyiv has been granted the right to use a portion of funds from the EU defense credit to purchase components of Chinese manufacture necessary for the assembly of unmanned aerial vehicles.
This decision concerns the first tranche of the EU defense credit, which amounts to approximately 6 billion euros. These funds are part of a grand support program providing 60 billion euros for Ukraine's defense needs.
The Exemption Mechanism
Standard program rules strictly regulate the origin of goods. Products purchased with European budget funds must primarily come from EU member states, Ukraine itself, or other approved partners. However, the regulations contain an important loophole: if necessary goods cannot be obtained promptly in sufficient volume from traditional partners, Ukraine may appeal to Brussels for special permission to purchase from third countries.
Kyiv utilized precisely this mechanism. The obtained permission serves as direct confirmation that the European defense industry is currently unable to fully ensure the production of drones with all necessary components. Despite actively ramping up capacity, some critically important elements still have to be sourced from outside the continent.
Geopolitical Paradox
The situation appears contradictory from a diplomatic perspective. The European Union has repeatedly accused Beijing of supporting the Russian military-industrial complex, pointing to the supply of dual-use goods. At the same time, Chinese components remain vital for Ukrainian drone production, forcing the West to make compromises for the sake of weapon effectiveness.
China remains a key player in global supply chains. However, in recent years, a gradual "geographical" shift has been observed. Some procurement has been redirected to the European Union, the United States, as well as Taiwan and South Korea.
Localization and Dependence
Within Ukraine itself, the volume of production of components for the defense sector is growing. Nevertheless, the most complex technologies remain dependent on imports. According to open estimates, last year the share of Chinese components in the design of Ukrainian drones decreased to approximately 38%.
The situation in the industry is heterogeneous. Some Ukrainian manufacturers have already achieved a localization level of up to 90%, fully supplying themselves with necessary parts. At the same time, certain products still depend significantly on foreign supplies, which necessitated obtaining special permission from Brussels.
