Ukrainian defense manufacturer Dnipro Electromechanical Plant (DEMZ) plans to invest at least €93.3 million in establishing production facilities for ammunition and metal ammunition components in Lithuania. The project is being implemented by its Lithuanian subsidiary, Baltic Metal Foundry, while Lithuanian authorities have proposed granting it special status to expedite administrative procedures.
Baltic Metal Foundry signed an investment agreement with Lithuania’s Ministry of the Economy and Innovation in August 2026. According to the country’s list of major investment projects, the investor has committed at least €93.3 million. The project is expected to create up to 450 jobs.
The company plans to build an ammunition assembly facility in Lithuania’s Prienai District and use existing infrastructure at the Alytus Industrial Park to manufacture metal ammunition components. The new production facility will be located on a 30.6-hectare site near Balbieriškis.
Lithuania’s Ministry of the Economy and Innovation has prepared a draft government resolution to recognize the project as meeting urgent national security and defense needs. This status is expected to provide special conditions for implementing the investment project and shorten approval procedures.
Construction of the facility in Prienai District was scheduled to begin in autumn 2026, with production expected to start by the end of 2027. The company has stated that its products will comply with NATO standards.
The Armed Forces of Ukraine are expected to be the primary market for the facility’s output, while the plant may subsequently supply products to meet the defense needs of allied countries.
The project forms part of expanding cooperation between Ukraine and Lithuania in the defense industry. For the Ukrainian company, establishing manufacturing operations in an EU member state also represents an expansion of the Ukrainian defense industry’s presence in European production and logistics supply chains.
