Signing Imminent? Bulgaria Set to Build Two Joint Factories with German Defense Giant Rheinmetall

Rheinmetall CEO Armin Papperger (left) and GERB leader Boyko Borissov (right)

The Bulgarian government has not abandoned plans to sign a contract with the German defense company Rheinmetall for the construction of two joint factories, and officials indicate that the signing is "imminent." This information was confirmed by the press service of the Council of Ministers in response to questions from RFE/RL.

Discussions about Rheinmetall’s potential investment in Bulgaria have been ongoing for months, coinciding with the European Union’s push to boost military production amid Russia’s ongoing war in Ukraine and concerns over potential limitations on U.S. defense support for Europe. In late August, Rheinmetall CEO Armin Papperger confirmed that the company would participate in the development of two plants in Bulgaria following a meeting with GERB leader Boyko Borissov. Borissov had stated that the contracts would be finalized and signed within three weeks, then submitted for ratification by the National Assembly so construction could commence.

The planned projects are expected to be funded under the EU’s SAFE defense financing mechanism. However, as of now, neither the government nor Rheinmetall has formally signed the contracts. Meanwhile, Rheinmetall has already secured agreements to build a gunpowder plant in Romania and an ammunition facility in Lithuania.

“No, the government has not given up [on the two plants with Rheinmetall]. Details of the contracts are being finalized and will be signed soon,” the Council of Ministers told RFE/RL, without providing further specifics.

Domestically, the planned factories have sparked political tension between Borissov and President Rumen Radev, who sought to take credit for the project. Following a meeting with YouTuber Stanislav Tsanov and investigative journalist Dilyana Gaitandzhieva, Radev claimed he had alerted the “competent authorities” after receiving reports of alleged violations and abuses at VMZ-Sopot, the enterprise that will participate in the joint plant projects with Rheinmetall.

Bulgaria has historically been one of the largest producers of Warsaw Pact-standard shells, widely used by the Ukrainian army. The new plants are expected to shift production to NATO-standard ammunition, significantly modernizing Bulgaria’s defense manufacturing capabilities.

Source: RFE/RL