During a mid-February visit to the Stalowa Wola production site of state-owned defence contractor Huta Stalowa Wola, Polish Prime Minister Mateusz Morawiecki stated that “to build a strong army, three things are needed: money, money and more money”.
The visit to HSW’s production site was used to announce substantial investments in the country’s arms industry – more specifically, a PLN 1.8 billion investment into Huta Stalowa Wola over two years (roughly €380 million), as well as PLN 100 million co-financing for automotive manufacturer AutoSan. These investments would be aimed primarily at increasing production capacity for the Krab and Borsuk platforms, to more than 50 and more than 100 per year respectively.
Ukraine – why it matters
This announcement came approximately at the same time as Ukrainian crews started to train on (now former) Polish Leopard 2 MBT’s, with an expected training time of around five weeks. Poland has already pledged to send 14 Leopard 2’s, all of which should be in Ukraine by mid-March, and has also pledged to deliver 60 additional tanks on top the not just the 14 Leopards, but also of the more than 250 T-72s and T-72 derivatives of various types it has already supplied to Ukraine.
Polish support to Ukraine has been extraordinary in quantity – more than 250 tanks, at least 42 IFV’s, 92 self-propelled artillery pieces, at least 20 multiple rocket launcher systems. All in all, Polish President Andrzej Duda estimated in June 2022 that Poland had provided assistance to Ukraine worth at least $1.7 billion. Notably, this number doesn’t account for all supplies post-June 2022, nor does it account for the soon-to-be-delivered (if everything goes according to plan) 29 MiG-29 fighter jets, which could be valued at roughly $580 million collectively, at least.
Replacing losses
Such a high loss of military capacity can, however, only be sustained if it can be replaced. Something which Warsaw is not just fully aware of, but more than willing enough to do.
In late November, Prime Minister Morawiecki laid out what underpins the vision which Warsaw’s government has for its national defence – namely, that the country must have an Army so powerful, its strength will deter any possible attacker. These statements echo those of Minister of National Defence Mariusz Błaszczak in July 2022: “we seek to make the Polish Army the strongest in Europe”. As a result, he pledged the country would invest PLN 100 billion to modernise the Army in 2023 alone.
This money will be directed solely towards procurement and research and development activities, helping to finance the procurement from abroad of approximately 1,000 K2 MBT’s, more than 600 self-propelled K9 howitzers, 48 FA-50 light attack aircraft and 288 K239 Chunmoo rocket launchers from Korea. On top of these Korean purchases, the Polish MON (Ministerstwo Obrony Nardowej, or Ministry of National Defence) has also signed contracts for the procurement of US-made systems such as 32 F-35A fighters, a package of HIMARS and ATACMS rocket launch systems and related equipment (18 HIMARS launchers, 468 HIMARS Launcher Loader Module kits, 45 M57 ATACMS systems), as well as 250 M1A2 and 116 M1A1 Abrams MBT’s. Furthermore, Poland has also manifested interest in the procurement of an additional six Patriot batteries, on top of the two it purchased in 2018.
In some cases, these procurement programmes seek to replenish losses of equipment which has either already been shipped to Ukraine or is expected to be soon – as is the case with the contract for 250 M1A2 Abrams tanks or the procurement of F-35A aircraft (which, although the contract was signed in 2020, was and is clearly intended to replace the Polish Air Force’s MiG-29s).
Record-breaking (foreign) procurement
When Poland signed its 2018 contract for the provision of two Patriot batteries (each with two fire units), it was seen as a major step in Polish military modernization. It was Poland’s largest ever defence contract, and much was made of how Poland would have to face a sizeable challenge if it really intended to replace all of its soviet and soviet-derived equipment with western-made weaponry.
Less than a year and a half later, Poland’s $4.75 billion Patriot deal was almost equalled by a $4.6 billion contract for 32 F-35A Lightning II fighter jets.
To paint the picture of how sizeable these procurement contracts have been, Polish military spending was, according to NATO’s latest estimates, $11.824 million in 2018, growing to $13.363 million in 2020. In relative terms, those contracts represented 40.17% and 34.42% of the country’s budget at the time they were signed, respectively.
Poland’s spree of record-breaking procurement contracts didn’t stop there. The country’s acquisition of 250 M1A2 Abrams tanks was reportedly worth $4.75 billion – a new record.
Its purchase of a HIMARS and ATACMS equipment package in February 2023 was reportedly worth $10 billion. A drop in the bucket compared to US defence spending, but representing 56.16% of what NATO estimates to be Poland’s defence spending in 2022. Warsaw’s planned purchase of six additional Patriot batteries, if per-battery cost is assumed to be similar to that of the 2018 contract, could be worth up to $14.25 billion.
Additionally, Polish procurement of made-in-Korea equipment has been valued to be at around $15 billion, which is higher than the Polish defence budget has ever been prior to 2022. Only accounting for foreign procurement, Warsaw has signed contracts in the last two years (up to early june 2023) estimated to be worth at least $49 billion.
Finally, Poland has also ramped up defence procurement in the late summer and early autumn of 2023. On september 6 2023 alone, for instance, Defence Minister Błaszczak procurement contracts worth PLN 100 billion at the Kielce International Defence Industry Exhibition (MSPO), mostly regarding equipment required for the operation of the WISŁA+ and Mała NAREW air defence systems. Other, additional, procurement has included the acquisition of a $12 billion package including 96 AH-64E Apache helicopters from the US (including missiles, ammo, guidance and night vision systems, as well as US training), aimed at fulfilling the country’s KRUK programme. A final procurement contract was then signed on December 12, 2023, with Minister Błaszczak penning a $2.6 billion deal with South Korean firm Hanwha for the provision of an additional 6 K9A1 146 K9PL SPG’s.
Looking inwards
Looking at the Polish MON’s spending spree, one could be excused for assuming that Minister Błaszczak woke up at some point in 2018 and decided to spend the following four years purchasing equipment worth more than his country’s previous four years of overall defence spending.
Moreover, it could be argued that such levels of foreign procurement, while able to bolster a country’s capabilities in the short or medium term, make it dependent on foreign suppliers to satisfy its needs and therefore both reduce its strategic independence and hinder the development of its domestic defence industrial base.
However, Warsaw is more than aware of this, and policy makers in the Polish capital have been careful not to prioritise the pace of the country’s rearmament over the survival and development of its defence industry.
For starters, Poland has not disregarded capacity-building for its domestic industries in the contracts it has signed with foreign contractors: 820 of the 1,000 K2 tanks Poland plans to purchase from Korea will be manufactured in Poland, and the agreement includes tech-transfer provisions, as do all other recent deals with South Korea. In fact, South Korea willingness to cooperate with local producers, open up facilities in Poland (such as a Maintenance, Repair and Overhaul or MRO Centre) and allow the transfer of technology has been one of the main reasons behind Warsaw’s decision to purchase from the East-Asian country, rather than from more established exporters such as Germany.
Poland has also penned a deal in July 2022 with Leonardo for the provision of 32 AW149 helicopters at a cost of PLN 8.25 billion (€1.76 billion). These helicopters will be produced by Leonardo-owned polish company PZL-Świdnik, at their Polish factory in Świdnik.
As of late 2020, Poland had several aviation procurement programmes. Although some have already found what they were looking for, others such as KONDOR (for a naval helicopter platform) have not. These procurement requirements can be satisfied either by foreign suppliers cooperating with local producers, as is the case with the provision of AW149 helicopters, or by local producers themselves once they have built the necessary know-how.
Similarly, Poland also had several outstanding land-based procurement programmes in 2020. These include the need to procure modern MBT’s, IFV’s, SHORAD, VSHORAD and other, longer-range air defence systems, tank-destroyers, mortars, and other systems. Poland’s need for modern land equipment was high three years ago, and is even higher today, following substantial transfers of weaponry to Kyiv and following the planned expansion of the Armed Forces. In some cases, entirely domestic platforms are already available: Poprad and Pilica VSHORAD systems, Borsuk IFV’s, the Rosomak platform, and the NAREW SHORAD systems are the main domestic platforms Poland is developing and has already begun procurement of, although others, such as the Ottokar-Brzoza tank-destroyer programme, are also in the works.
Finally, Poland’s procurement programme has no intention of leaving the country’s naval forces behind. Although Warsaw’s situation dictates that most of the funds be directed towards the improvement of the Wojska Lądowe and, albeit less, the Air Force (Siły Powietrzne), the Marynarka Wojenna is still slated to be involved in a sizeable upgrade of its capabilities. This includes not only the afore-mentioned KONDOR, but also the Miecznik frigate procurement programme - so far including 3 new domestically-built frigates but with an additional 5 being considered.
Although concerns on polish domestic production do remain, such as worries that contracts awarded to South Korean firms will lead to a resizing of those for domestic manufacturers, Warsaw remains adamant that its planned military build-up will overwhelmingly benefit domestic manufacturers.
An example? Poland is set to procure upwards of 2,000 Borsuk IFV’s from HSW, has already procured at least 79 Poprad systems from PIT-Radwar, has signed contracts for the procurement of at least 36 Pilica systems, as well as for the procurement of an additional 40 M120 Rak mortars, and has ordered an additional 48 AHS Krab from HSW. All of these platforms are either produced by domestic manufacturers in their entirety, or, as is the case with other platforms such as Krab, contain foreign-derived components (in the case of Krab, the chassis is a derivative of the Korean K9, the turret of BAE’s AS-90M, and the 52-calibre Nexter Systems gun). Poland is also lobbying aggressively for the opening of strategic production lines on Polish territory from US-based companies, in cooperation with the country’s defence industry, and the government’s efforts have secured an agreement with the Javelin consortium (signed on Sep. 6 in Kielce), regarding the creation of a Javelin missile production line (including the entire system’s production) in Poland by PGZ and Mesko S.A.; the expertise from the creation of this production line will be critical to Mesko’s work in developing Poland’s future domestic anti-tank missile system (named Pirat).
Export success?
Probably the most important metric to evaluate the sustainability and competitiveness of any national arms industry is whether it produces equipment which is viable on the international market.
The defence industry is a very difficult market to break into, with a series of heavily entrenched actors (Lockheed, Raytheon, BAE, RheinMetall, Leonardo, Dassault, to mention some among the most relevant western players in the industry). Despite this, recent years have seen aggressive penetration by South Korean and Chinese firms, albeit in different sections of the market.
It will be difficult for Poland to equal the degrees of success recorded by South Korea in its market penetration attempts in the West, not least because Seoul is not bound by the EU’s state aid norms and can heavily subsidise its defence industry.
Nevertheless, some degree of market success is already being witnessed by Polish defence firms. First and foremost, Ukraine has signed a number of procurement contracts with PGZ, including a $650 million contract for 78 Krab units. Krah has also been considered by Romania for its modernisation programme, before Bucharest oriented itself towards the platform which provides much of the technology for the Krab - the Korean K9 Thunder. Other exports have included the KTO Rosomak platform (100 exemplars have been shipped to Ukraine), and there have been talks regarding the procurement of Borsuk. Additionally, the Slovak MoD has agreed to the purchase of a polish-made air defence system at the Kielce MSPO - although the system whose purchase has been agreed has not been made public, it is widely speculated to be the Pilica+ system.
The Strongest Army on The Continent?
Poland has always been a country with a fierce military reputation and a proud military history, and its defence industry has always been at the centre of the Polish State’s economic development plans: in the 1930s, it was Gdynia, with its shipyards and port, and the Central Industrial Region, which, among other things, would give birth to the city of Stalowa Wola. In the post-war period, heavy industry and the defence industry in particular were seen as key to economic development – albeit the development of a Polish domestic defence industrial base worried the Soviets. In the present, Poland’s defence industry is returning to the fore of Warsaw’s economic development efforts.
The development of the country’s domestic defence industry is mainly aimed at two things: on the one hand, promote economic growth by developing a sector with high levels of interoperability of skills and with high spill over effects; on the other, supplying what Poland’s ruling party Prawo i Sprawiedliwość envisions will be “the most powerful land forces in Europe”.
