The amendments introduce a new category of investment projects in Lithuanian regulation. From now on, large-scale manufacturing projects in the defence sector can be recognized as addressing pressing national security needs. Such projects will enjoy regulatory exemptions and simplified procedures, which will allow investors to set up operations significantly faster. For instance, companies could start the construction of their facilities without a building permit, obtaining the permit before completing the construction.
“Increasing the production capacity of the defence industry to ensure our defence stockpiles and continue supporting Ukraine is becoming a priority for Europe as a whole,” says Aušrinė Armonaitė, the Minister of Economy and Innovation. “The new regulation puts Lithuania at the forefront of this change and in line with the EU’s industrial policies aimed at promoting a rapid ramp-up of manufacturing capacities in the continent.”
Designed to promote the development of large-scale defence production, the new regulation boosts the comprehensive support Lithuania offers for defence companies. Tax incentives for large-scale investment projects include a 0% corporate income tax for 20 years.
Defence manufacturers establishing operations in Lithuania will join a rapidly developing ecosystem of innovative companies. The country is home to a growing number of businesses that leverage its industrial strengths in telecommunications, lasers, sensors and other high-tech fields to produce unmanned aerial vehicles and systems, anti-drone devices, remote initiation systems and other cutting-edge military products. Between 2018 and 2023, the number of specialists employed in Lithuania’s defence industry grew by 14% annually on average, which is twice as fast as the national average in the same period.
“In Lithuania, defence manufacturers can find a strong network of partners, as well as specialists with the necessary manufacturing competencies. Together with Lithuanian producers of robotics, electronics and military technology solutions, international investors can benefit from synergies, grow their businesses and contribute to the stability and security of Europe,” says Aušrinė Armonaitė, the Minister of Economy and Innovation.