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Bulgaria has signed an agreement with Germany’s Rheinmetall to build a gunpowder and ammunition factory
ByThe Associated Press
October 28, 2025, 7:41 AM
SOFIA, Bulgaria — Bulgaria signed an agreement Tuesday with Germany’s defense company Rheinmetall to build a gunpowder and ammunitions factory as part of Europe’s efforts to improve its defenses following Russia’s invasion of Ukraine.
The factory, which will produce gunpowder, 155 millimeter artillery shells and modular charge systems, will be developed as a joint venture between Rheinmetall and Bulgaria’s largest state-owned arms factory VMZ–Sopot.
The plant will create nearly 1,000 high-skilled jobs, making it one of the largest industrial projects in Bulgaria in recent years, officials said.
The German company will hold a 51% share in the joint venture, and Bulgaria will finance its participation through loans under the European SAFE mechanism.
After signing the agreement, Rheinmetall CEO Armin Papperger said that the new facility could be ready within 14 months and start production of up to 100,000 artillery shells annually.
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European Union and NATO member Bulgaria considers the project as part of the joint efforts to strengthen defense production and supply chains.
Prime Minister Rosen Zhelyazkov said the agreement was “a huge step forward in Bulgaria’s industrial and defense capabilities.”
Bulgaria was one of the major arms producers in the former Soviet bloc during the Cold War, specializing in small arms, ammunition and light armored vehicles. The collapse of the Warsaw Pact led to a steep decline in the sector, forcing many state-owned factories to shut down.
Russia’s full-scale invasion of Ukraine in February 2022 has brought a new momentum for Bulgaria’s arms production, making it an important supplier of ammunition for Kyiv.
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