BAKU, Azerbaijan, September 29. On Thursday, September 25, Latvia signed a memorandum of understanding with German defense industry leader Rheinmetall AG to build an artillery ammunition plant in Latvia, Trend reports.
The signing ceremony was attended by Latvian Prime Minister Evika Siliņa, Minister of Economics Viktors Valainis, State Defense Corporation (VAK) board member Ingrīda Ķirse, and representatives of Rheinmetall.
The project will be implemented through a joint venture and is expected to attract more than 200 million euros in investment. Over the next decade, the plant’s exports could exceed 3 billion euros. Construction is scheduled to begin in spring 2026, with production planned to start the following year. Earlier this week, the Latvian government approved the project as part of its strategy to strengthen the defense industry.
Prime Minister Evika Siliņa emphasized that the agreement reflects Latvia’s consistent investment in both national security and allied cooperation.
“This partnership with Rheinmetall allows us to bring in hundreds of millions of euros in investment, create new jobs, and provide Latvian companies with access to cutting-edge technologies. It strengthens not only our economy but also our national security and NATO’s collective defense,” Siliņa said.
“Latvia is deliberately developing the defense industry as a key part of the economy. This means new investment, high-value jobs, and technology transfer that benefits our entire economy. Our companies gain the opportunity to integrate into international supply chains and become part of Europe’s modern defense ecosystem,” Minister of Economics Viktors Valainis highlighted the broader economic impact.
Defense Minister Andris Sprūds stressed the strategic importance of the project, while VAK board member Ingrīda Ķirse underlined the responsibility entrusted to the State Defense Corporation, pointing to the combination of Latvia’s national priorities and Rheinmetall’s long-standing industrial expertise as the foundation for a strong partnership.
The project follows on from Latvia’s first major defense industry initiative, the ROLLO modular artillery propellant charge assembly facility. Both projects aim to strengthen Latvia’s industrial base, foster innovation, and deepen integration into the European defense sector.
The memorandum was signed during a major Latvian business delegation visit to Germany, led by Prime Minister Siliņa and Minister Valainis. The mission, involving more than 180 companies and organizations, highlights the growing economic and security ties between Latvia and Germany, combining science, business, and defense industry cooperation.
The trade mission will continue in Rostock on September 25–26 as part of the Latvia–Germany Business Day, which brings together more than 250 participants to discuss issues related to the development of energy, digitalization, infrastructure, and the defense industry.
Earlier this year, the Latvian government approved the Defense Industry and Innovation Support Strategy 2025–2036, which allocates more than 200 million euros for defense industry development, including business incubation, R&D, product deployment, and large-scale investment projects.