Polish state-owned defense company PGZ plans to increase exports of military equipment tested in Ukraine and dual-use products. The company aims to increase the share of exports and dual-use products to one-third of its revenue.
Poland intends to sell military equipment tested in Ukraine and dual-use products to allies, expanding exports and cooperation with European defense giants. This was reported to Bloomberg by CEO Adam Leszkiewicz of the state-owned company, writes UNN.
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He noted that the state-owned company plans to win more foreign contracts for its equipment — in particular, portable air defense systems and howitzers, which have already been tested in combat conditions in Ukraine. He also sees opportunities to expand sales beyond the Polish army, including selling dual-use products to the private sector.
Russia's war against Ukraine stimulates Poland's growing arms spending
This move comes as the European Union allocates funding to modernize the defense industry due to Russia's full-scale invasion of Ukraine. Polish defense companies have largely been unable to meet domestic demand, as the country has doubled its defense budget to almost 5% of GDP since 2022.
The EU's €150 billion ($175 billion) arms program is set to change this situation, especially since the plan "prioritizes" funding for projects based on pan-European cooperation, Leszkiewicz noted. This model will help PGZ gain new knowledge and participate in new cross-border projects.
Cooperation between European defense companies has been absent for many years. Today, we are looking for partners to learn something, or acquire, or jointly produce products based on new technologies
– Leszkiewicz said in an interview in Brussels.
PGZ, which unites 70 companies and employs 22,000 people, aims to raise its international profile at a time when Poland is set to be the largest beneficiary of the EU's arms program, known by the acronym SAFE.
The initiative includes strict "buy European" restrictions, allowing members to purchase new military equipment, although it has been overshadowed by disputes over how non-EU countries, particularly the UK, can qualify, Bloomberg previously reported. SAFE also allows participants to rebuild local defense industries.
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PGZ, located in Radom, Poland, aims to strengthen its research and development budget and forge more partnerships with European counterparts, Leszkiewicz said. The company already cooperates with Thales and the British Babcock International Group Plc on frigates, with BAE Systems on ammunition, and with Rheinmetall on armored vehicle production.
PGZ's sales last year grew by 36% to PLN 13.9 billion ($3.8 billion), while net profit increased by 92% to PLN 1.7 billion. Leszkiewicz noted that his goal is for one-third of revenues to come from exports and dual-use products, with exports accounting for a quarter of sales. Currently, these categories together provide less than 20% of revenues, he said.
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