Lithuania is planning to establish a state-owned holding company to bring together companies from the defence industry, Deputy Defence Minister Orijana Masale has announced.
“The prime minister has already said that defence companies should operate under a certain holding structure,” the official told the BNS news agency in an interview. “This could be a state-owned company which performs what we could describe as a holding function, and this would encompass various areas of defence.”
“At this time the companies are scattered across different institutions with shareholder rights, and there are new areas in which they could operate,” Masale added. “This is why the idea is to bring it all under one umbrella, and this work will begin soon.”
The deputy minister explained that such an enterprise would help to streamline management, concentrate managerial competencies, and provide stability and clarity for potential partners.
For the time being, she added, the plan only includes defence companies and not those that are responsible for the transport infrastructure.
Prime Minister Gintautas Paluckas has, indeed, said in the past that Lithuania hopes to establish joint defence industry companies and factories with local and foreign capital in which the state would also take part.
The Finance Ministry currently owns 100% of shares in the Giraite Armament Plant (GGG), which is a small-calibre ammunition manufacturer in the Kaunas District. The Transport Ministry, for its part, is the sole shareholder in Detonas, which manufactures explosives, is registered in Kaunas, and has branches in Pakruojis and Akmene.
The responsibility for public procurement in the defence system and the administration of allocated funds is under the aegis of the Defence Materiel Agency, which operates under the Ministry of Defence. Last August a new Defence Industry Policy and Innovation Department was established in the agency with an eye toward further co-operation with businesses.
The German defence industry giant Rheinmetall has partnered with GGG and Epso-G Invest which is a subsidiary of the Epso-G energy group in Lithuania. This partnership will launch a new project this year to build a 155 mm artillery factory in Baisogala, which is a small town in the northern district of Radviliskis. The preliminary investment is estimated to be between EUR 260 and 300 million.
Meanwhile, the government is also continuing talks with the US defence giant Northrop Grumman on the construction of a 30 mm ammunition production line at the Giraite factory in the Kaunas District.
Lithuania also has a memorandum of intent with an unnamed company in Ukraine on the construction of an RDX explosive plant. BNS has learned that the company in Ukraine is the Centre for Special Chemistry.
Source: BNS
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