site.btaGunpowder Plant Will Be 49-51 JV of VMZ Sopot and Rheinmetall - Defence Minister

The gunpowder plant that will be built in Bulgaria will be a 49-51 joint venture between VMZ Sopot and Germany's Rheinmetall, Bulgarian Defence Minister Atanas Zapryanov said on NOVA Television Monday morning. He specified that the JV planning and conclusion of an agreement are being finalized.

In his words, the setting up of gunpowder and shells manufacturing operations gives the Bulgarian defence industry a chance to implement production standards enabling VMZ Sopot to start supplying its output to NATO and EU countries as well.
 
"Even now we manufacture Soviet-standard 122 mm and 152 mm shells and weapons. Now we will have an assembly line for the production of 155 mm shells. Bulgaria will rearm its artillery, and we will shortly procure 155 mm artillery systems to our artillery units," Zapryanov said. 

He argues that this is in the national interest, which is consistent with Europe's interest to increase its arms production, integrate its defence base, and invest more in a modernization of the weapons industry. "It is also consistent with NATO's requirement for our armed forces to acquire new capabilities and for Bulgaria to increase its defence spending in order to address the threats," the Defence Minister explained.  

In his estimate, the start of production will take three years at most from the point when the agreement is concluded. He added that another 1,000 new jobs will be created in the new plant.

Bulgaria will invest some EUR 500 million in the plant, and the money will come from the EU Security Action for Europe (SAFE) financial instrument. "This is a loan of the type of those available to Member States during the COVID-19 pandemic," Zapryanov explained, adding that the 35-year loan will come with a ten-year grace period for the repayment of the principal. 

Asked who deserves the credit for this cooperation with the German corporation, which is Europe's largest defence products manufacturer: GERB leader Boyko Borissov or President Rumen Radev, the Defence Minister said that the Government is supposed to provide the budget, whereas the GERB-UDF Parliamentary Group, on whose mandate the cabinet was elected, and Borissov, as its leader is supposed to ensure political support because the National Assembly will resolve on the financing. "The role of the leader of the mandate-holding party is crucial for securing a political majority to back the decision we are making now," Zapryanov said.

European Commission President Ursula von der Leyen and Bulgarian Prime Minister Rosen Zhelyazkov on Sunday visited VMZ Sopot (Central Bulgaria).

On August 25, GERB leader conferred with Rheinmetall CEO Armin Papperger at the corporation's headquarters in Dusseldorf. It emerged at that meeting that Bulgaria and Rheinmetall will set up two plants in the territory of the country: one for the production of gunpowder and charges, and one of 155 mm long-range artillery shells up to NATO standard.
 
"At the beginning of the year I managed to persuade a strategic investor like Rheinmetall, an investor the current government can only dream of, not only to visit Bulgaria but also to invest significant financial resources and cutting-edge technologies in our defence industry," Radev said on August 25. "Today, they are in Germany working on this investment, which I secured as a gift for the government,” said the head of State.