Bulgaria and German Rheinmetall AG sign a strategic agreement on the construction of a gunpowder and ammunition plant

Bulgaria and German Rheinmetall AG sign a strategic agreement on the construction of a gunpowder and ammunition plant

28.10.2025

Bulgaria and the leading German technology corporation Rheinmetall signed a strategic agreement on the construction of a gunpowder and ammunition plant. The signing ceremony took place in the Council of Ministers building. The project will be implemented as a joint venture between Rheinmetall AG and VMZ-Sopot. The total investment amounts to around EUR 1 billion.

Prime Minister Rossen Jeliazkov emphasized the political, economic and social dimensions of the joint venture.

"The conclusion of this agreement marks the beginning of a strategic partnership between the Bulgarian Government and the German technology corporation and this partnership will change the future of the Bulgarian defense industry," Prime Minister Rossen Jeliazkov said.

The Prime Minister emphasized that the project is the outcome of the efforts between the European Union and NATO to strengthen the defense of Europe and to enhance its strategic autonomy. Rossen Jeliazkov added that the investment would promote technology transfer, scientific cooperation and regional development, as a basis for a sustainable economic partnership.

"We are laying the foundations of a partnership that unites German's technology experience and Bulgaria's industrial potential so as to build a safer future for Europe," Rossen Jeliazkov said further.

The Minister of Economy and Industry Peter Dilov said that the project opens up a new phase in the development of Bulgarian industry and will give a strong impetus to its modernization.

"The conclusion of this agreement marks the beginning of a strategic partnership between the Bulgarian Government and the German technology corporation and this partnership will change the future of the Bulgarian defense industry," Peter Dilov said. "The project will enable us to build a sustainable and independent defense capacity that will support the security of the entire region," the Minister said further.

The Chief Executive Officer of Rheinmetall Armin Papperger expressed his satisfaction with the rapid progress and high level of cooperation with the Bulgarian party. "Bulgaria's speed is unprecedented. Our second meeting brought us to establish one of the best plants in Europe," Mr. Papperger said. He emphasized that Europe and NATO need 50 million ammunitions and Bulgaria will make its significant contribution. "We are grateful for the trust. We are here not only as business partners, but also as friends," he added while he expressed his confidence that other European companies will also invest in Bulgaria as the country has well-educated people and a stable government. Armin Papperger noted that it will take 14 months to build the plant and thanked the Bulgarian Government and the GERB leader Boyko Borissov for their support and coordination.

When the plant goes into operation, it will create some 1000 new jobs and Bulgaria will recover a key component of its defense capacity. The production list will include gunpowder, 155 mm artillery shells and modular charging systems that meet the latest technology standards.