The Lithuanian government on Tuesday signed a letter of intent with Germany’s defence industry giant Rheinmetall, which is planning to build an ammunition factory in the country and has applied for the status of a large-scale investment project.
Economy and Innovation Minister Aušrinė Armonaitė, Prime Minister Ingrida Šimonytė, Defence Minister Laurynas Kasčiūnas, and Rheinmetall’s Maximilian Froch took part in the signing event.
According to Armonaitė, Rheinmetall’s investment will be one of the largest in Lithuania’s history and the largest among defence industry companies.
“It will give a boost to our industry, our economy, and the security of our region,” she said.
Rheinmetall’s investment shows that the German company “trusts Lithuania’s talented people and believes that Lithuania is a safe country for significant investment”, the minister said.
A decision on recognising the factory as a large-scale investment project could be made later this week.
“The company has submitted a large-scale investment project application, which is being evaluated by an institution authorised by the Economy and Innovation Ministry,” Armonaitė said.
“If the criteria are met, we can also expect ministerial approval [of the status] this week, paving the way for very concrete steps in this investment project,” she added.
The details of the letter of intent are not yet public. Special investment and business conditions usually apply to large-scale investment projects.
According to Armonaitė, Lithuania expects the main works, including the construction of the factory, to start later this year, but these are only theoretical considerations for now.
The minister said that she could not comment yet on Lithuania’s exact contribution to the project but added that the country could help develop the necessary infrastructure for the facility and possibly purchase some of the ammunition manufactured by the factory for its military needs.
Seven sources, most of whom spoke on condition of anonymity, have confirmed to BNS that state-owned land in the northern Lithuanian district of Radviliškis is being considered as a location for Rheinmetall’s factory.
The land near the town of Baisogala is now operated by the Lithuanian University of Health Sciences (LSMU) on a loan-for-use basis.
Armonaitė said on Monday that “no plot of land has been approved yet”.
“Simply put, the company’s project needs a land plot of very specific size and specific requirements. As we know, Lithuania is not a large country, so there aren’t that many of them,” she said.
Investment projects of this kind are not located in densely populated areas, the minister noted.
Baisogala has a population of about 1,800.
Prime Minister Ingrida Šimonytė met with LSMU Rector Rimantas Benetis on Monday but declined to comment on the content of the meeting.
“The rector and I talked about various issues. Since it was a working meeting, I prefer not to comment further,” she told reporters.
The plot of land that Rheinmetall is interested in is currently used by the university’s Institute of Animal Science.
Benetis told BNS after the meeting with Šimonytė that solutions would be sought to reconcile the interests of the university and the state.
“We talked that the state may need the land. The plot meets the state’s requirements, and we need to find a solution to ensure that the university’s processes are not disrupted and that the state’s interest is reflected,” the rector said.
According to the LSMU rector, the issue of land transfer will be further addressed at a technical level.
On Tuesday, Šimonytė confirmed that the land plot operated by the LSMU is one of the possible sites considered as a location for the Rheinmetall plant.
“It is currently occupied and until otherwise, I cannot say for sure that this is the plot where that production will be developed,” she told reporters.
According to Šimonytė, a specific location for the plant has not yet been identified, and an industry of this scale requires a very large site.
“We need a very large site, and we are looking for a solution that does not involve consolidating many land plots into one. We need to develop an optimal solution so that a large site can be used immediately,” she said.
The Lithuanian parliament last week started debating a legislative package, tabled by the Economy and Innovation Ministry, to facilitate the construction of factories by major Western arms and ammunition producers, including Rheinmetall.
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