Historic Agreement Signed in Hamburg
Latvia and German defense giant Rheinmetall have formalized an agreement to construct a state-of-the-art artillery ammunition production facility in Latvia. A Memorandum of Understanding (MoU) was signed on September 24, 2025, in Hamburg, Germany, marking a significant investment of €275 million into Latvia's defense industry. The signing ceremony was attended by key officials, including Latvian Prime Minister Evika Siliņa, Economics Minister Viktors Valainis, and Rheinmetall CEO Armin Papperger.
Joint Venture to Boost Production and Security
The new plant will operate as a joint venture, with Rheinmetall Waffe Munition GmbH holding a 51% majority stake and the Latvian State Defence Corporation owning the remaining 49%. This strategic partnership is designed to ensure a reliable supply of 155mm calibre artillery ammunition for the Latvian National Armed Forces and partner countries, thereby strengthening regional and NATO security. The facility will feature a modern production line, including shell forging and filling capabilities.
Timeline and Economic Impact
Construction of the new ammunition plant is scheduled to commence in spring 2026, with production expected to begin approximately one year later, around spring 2027. The project is projected to create at least 150 local jobs and integrate regional companies into its value chain, stimulating the domestic economy. Latvian officials anticipate that the plant could generate up to €3 billion in exports within a decade.
Strategic Importance for Latvia and Europe
Prime Minister Evika Siliņa emphasized the broader implications of the deal, stating, 'Signing this MoU is a clear step towards strengthening Latvia's security and developing our defence industry.' She added that by partnering with Rheinmetall, Latvia 'not only builds stronger national defence, but also contributes to security of supply in Europe, enhancing industrial capacity as well as facilitating economic growth.' Rheinmetall CEO Armin Papperger echoed this sentiment, expressing his pleasure 'to be able to contribute to Latvia's national sovereignty in the field of ammunition' and to strengthen Rheinmetall's position as 'the world's leading manufacturer of artillery ammunition.' The project aligns with a wider European effort to increase defense manufacturing capabilities, with similar Rheinmetall initiatives underway or planned in neighboring Lithuania and other European nations.
5 Comments
Leonardo
Turning Latvia into a military target. Very short-sighted.
Michelangelo
This strengthens European defense autonomy. A necessary step.
Raphael
This is just another step towards endless conflict.
Loubianka
While increased defense production is understandable given current events, I worry about the long-term implications of such heavy militarization in the region. We need to balance security with de-escalation efforts.
Comandante
On one hand, securing a reliable ammunition supply is vital for national defense in uncertain times. On the other, focusing solely on military solutions can overshadow diplomatic efforts for lasting regional peace.