UK signs agreement to support Ukraine's domestic arms industry.

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The U.K. and Ukraine signed an agreement that provides credit support for the development of Ukraine's defense industry, Ukraine's Presidential Office announced on July 19. Defense Minister Rustem Umerov signed the agreement in London with U.K. Defense Secretary John Healey in the presence of President Volodymyr Zelensky and British Prime Minister Keir Starmer.

According to the Presidential Office, the agreement will support the partial production of air defense systems, armored vehicles, and ammunition in Ukraine. "Due to the need for rapid development of capabilities and the high cost of defense projects, Ukraine cannot currently finance them from its state budget," the Presidential Office said. The text stipulates that British suppliers will be able to conclude credit agreements and contracts with Ukraine for up to 2 billion pounds (£2.6 billion).

The agreement will "fire up both the U.K.'s and Ukraine's defense industrial bases and increase military hardware and weaponry production," the British government said ahead of the signing on July 18. Zelensky arrived in the U.K. on July 18 to attend the European Political Community summit, held at Blenheim Palace in Oxfordshire. Upon arrival, he immediately met Valerii Zaluzhnyi, Ukraine's former commander-in-chief and recently appointed ambassador to the U.K.

Later in the day, Zelensky signed 10-year bilateral security agreements with Czechia and Slovenia and met with King Charles III. The new agreement follows an agreement signed in April between the U.K. and Ukraine to encourage defense industry cooperation and support joint projects between British and Ukrainian companies. The agreement was signed in Kyiv during the U.K.'s largest-ever trade mission to Ukraine.

A delegation of 29 British defense companies was present at the signing, together with representatives from 70 Ukrainian defense companies. During the trade mission, BAE Systems also signed an agreement with the U.K. government for the maintenance, repair, and overhaul services in Ukraine of the L119 light gun, a 105 mm howitzer. As well as the L119, Ukraine's military uses 17 different types of weapons and equipment made by BAE Systems, such as Challenger tanks and Bradley armored vehicles.

BAE Systems opened an office in Ukraine in August 2023 to help launch the domestic production of weapons like the L119 in partnership with Ukrainian manufacturers.

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