What do we need to create a strong defence industry in Lithuania?

This opinion piece was written by Šarūnas Genys Head of the Manufacturing Team at Invest Lithuania and was originally published by Verslo Žinios on May 6th.

The defence industry is a global market dominated by major corporations. So far, Lithuania has mostly been seen as a buyer rather than a producer. Yet, with world-class technologies such as lasers, drones, semiconductors, and other advanced innovations being developed here, it’s clear that we have the potential to play a much more significant role.

Discussions about closer cooperation between Lithuanian and international businesses in the defence sector picked up pace with Rheinmetall’s entry into Lithuania. Considered the most notable investment of the past year, the German defence company plans to invest more than EUR 180 million. The project is expected to bring a range of benefits, creating at least 150 jobs, boosting the local economy, and reducing the length of the supply chain for key military equipment. This example shows clearly that cooperation between local industry and international investors is both possible and necessary.

Europe offers numerous examples where foreign investors successfully collaborate with local businesses. In countries like the Czech Republic, Hungary, and Poland, defence contracts often include provisions for manufacturing certain components locally. This shows that Lithuania does not necessarily need to build its own factories to establish itself in the global defence industry – it can focus on what partners currently lack and fill those gaps in the market.

Ongoing geopolitical challenges and Europe’s efforts to boost its defence capabilities present Lithuania with a valuable opportunity to draw both local and international investment. Making the most of this moment doesn’t require producing every part of a defence system. Instead, success can come through specialization—whether in component manufacturing, technological development, or niche services. By focusing on these areas, Lithuania can make better use of its strengths, support high value-added industries, and create a more attractive environment for investors.

These solutions are necessary for modern weaponry. Therefore, the question is not “Do we have something to offer?” but “Can we communicate it effectively and create attractive conditions for investment?”

A much more complex task is integrating into global defence supply chains. The topic of industrial cooperation must be raised from the very beginning of negotiations with defence suppliers. We must clearly communicate the potential of our manufacturers in lasers, drones, semiconductors, and other high technologies. In other words, we must show that we are ready to contribute actively to the modern defence industry.

Read the full article on: Verslo Žinios