SUBSCRIBER+EXCLUSIVE REPORTING — The Biden Administration says it has one more military aid package available for Kyiv before the end of the year and then Ukraine’s future will be largely determined by decisions made in Congress, where a potential aid package is being bogged down by politics as usual.
“When that one’s done … we will have no more replenishment authority available to use and we’re going to need Congress to act without delay” White House national security spokesperson John Kirby told reporters on Monday.
Meanwhile, other European countries are pledging support. British Foreign Secretary David Cameron told reporters after meeting with his French counterpart in Paris, that both Britain and France will continue to be “staunch supporters” of Kyiv. Italy’s cabinet has already passed legislation to provide aid through the end of 2024.
But as Congress plays politics, the Biden Administration is betting on the U.S. private sector, which has already provided significant support to Ukraine since before Russia’s unprovoked invasion on February 24, 2022, as it’s not-so-secret weapon.
“They are very much a partner in this effort,” Kirby told The Cipher Brief. “The defense industry has been, and we anticipate will be, a significant partner, not only assuming we can get the supplemental funding and support for Ukraine, but in supporting our own defense industrial health, and improving our own national security by keeping production lines open, advancing the development of systems, and the development of new systems.”
Kirby says that’s a win for Ukraine and for the U.S. because it “will not only increase our ability to help Ukraine defend itself and beat back the Russians on Ukrainian soil but it will also help our own national security by replenishing the shelves in our warehouses with better and more advanced capabilities and systems.”
Former Senior CIA Officer Paul Kolbe, who spent much of his career in the region and is a Cipher Brief expert, says that Russia has put its entire economy on a war footing and while U.S. government aid is necessary for Ukraine's survival and eventual victory, it’s not sufficient. “As in WWII, government and the private sector must work hand in hand for victory.”
In a bid to strengthen those relationships, the Biden Administration held a Ukraine Industrial Base Conference hosted by the U.S. Department of Commerce earlier this month in Washington, convening more than 300 U.S. and Ukrainian members of industry.
“We know the importance of a resilient Ukrainian defense industrial base, and that's what today is all about,” U.S. Commerce Secretary Gina Raimondo said in a statement shared with reporters as the conference kicked off. “We are committed to helping Ukraine leverage and expand your own considerable defense in defense industrial base capabilities. You have a strong defense industrial base, but we need to lean in to work with you in partnership with the private sector, the public sector, to strengthen it, and to deepen it to make it more innovative.”
The conference, which saw agreements on embedding a U.S. government advisor with Ukraine’s Ministry of Strategic Industries to speed up Ukraine’s development while combatting corruption and attracting foreign investment, also established a “Ukraine Deal Team” to provide guidance to businesses seeking deals in the country by helping to navigate complicated export requirements needed for Ukraine’s defense industry. It also announced agreements on data sharing that will allow for in-country production of air defense-related technologies.
Ukraine’s Minister of Strategic Industries, Oleksandr Kamyshin told The Cipher Brief’s ‘The Fight’ Podcast during a June interview in Kyiv, that his country has learned a lot from nearly two years of finding ways to improve on the products and systems that have been provided by Western countries since the war began.
It’s a sentiment he repeated at the D.C. conference, telling attendees that Ukraine is ready to share lessons it’s learned on adapting and improving current technology in exchange for long-term cooperation with some of the world’s largest defense companies.
"We'll be happy to share our experience in defense technology as it allows us to give asymmetric responses when we're outnumbered by the enemy,” said Kamyshin. This is an opportunity to open new markets. We all know that the war has depleted stocks and warehouses around the world - these warehouses will need to be replenished. Ukraine offers longer-term prospects, and this is our uniqueness."
“Ukraine has ambitious plans to build a domestic arms industry that can make up this gap and has started to enlist firms such as BAE, Rheinmettal, and Baykar to build arms plants in Ukraine even as the war continues,” said Kolbe. “Others will follow suit. This helps Ukraine now and also positions it to be the free world’s center of high-quality, low-cost arms when the war ends.”
Kolbe, who also spoke at The Cipher Brief’s Kyiv Economic and Security Forum in May, said that by necessity, Ukraine has become the defense innovation lab of the world. “Firms on all sides - Ukrainian, Russian, Chinese, and American - are racing to learn and apply the new rules of warfare and technology. The ones who move the quickest and the best will have a military and commercial advantage for decades to come.”
The private sector is such a serious part of the Administration’s playbook on Ukraine that Secretary of Defense Lloyd Austin and Deputy Secretary of Defense Kathleen Hicks have been working hard to shore up government relationships with the defense industry, according to Kirby, who said the D.C. conference, “was all about not only helping our defense industrial base get a better grip on what the needs are going to be going forward, but how they can work in partnership with Ukraine's defense industry, so that post-conflict, Ukraine can have as resilient and as vibrant a defense industrial base as possible.” He told The Cipher Brief, “We absolutely see our defense industry as a partner here.”
While many U.S. companies still cite corruption concerns as a serious hurdle for doing business in Ukraine, Kolbe believes that’s a problem that can be addressed organically to some degree, through greater engagement.
“More Americans working in Ukraine can translate into great transparency, better two-way information flows, and more efficient use of precious resources. Why return a damaged tank to Poland when it could be repaired better, faster, and cheaper in Ukraine? Since most American defense aid is going to American companies, it is reasonable to expect that these same companies put their cowboy boots on the ground.”
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