The Outlook for Polish Arms Exports

Although Poland’s defense spending last year may seem impressive, the situation regarding domestic exports looks far less optimistic. What steps should be taken—and why—to effectively protect the country’s military capabilities?

Import

In 2024, Poland allocated a record 135 billion zlotys to the defense sector. This is the highest amount in the history of the Third Republic of Poland and also represents the largest share of GDP among all NATO countries in Europe—nearly 4%.

The fact that Poland “rose to the challenge” was noted in late February by U.S. President Donald Trump. He pointed out that Poland had contributed more to the alliance than it was formally obligated to do under the agreement. What’s next? This year’s budget of the Ministry of National Defense is expected to amount to approximately 190 billion zlotys (4.7% of GDP), and in 2026, it is projected to exceed two important thresholds—200 billion zlotys and 5% of GDP.

Export Data

The country's export figures, however, are far less impressive. According to a report the Ministry of Foreign Affairs for 2023, in none of the recent years has the country actually managed to export equipment worth more than 30% of the value of the export licenses issued (based on aggregate data—without distinguishing between importers and intermediaries).

In 2023, exactly 1,171 licenses were granted, and the documents covered arms exports with a total value exceeding 10.5 billion euros. Actual exports, however, amounted to only 1.75 billion euros—about 16% of the planned value.

The situation was slightly better a year earlier. Although 1,237 licenses were issued at that time, their total maximum value was approximately 5.7 billion euros. Exports amounted to approximately 1.2 billion euros, which represented slightly more than 20% of the forecast.

Unsurprisingly, Ukraine was the largest recipient of Polish weapons—in 2023, equipment worth approximately 1.4 billion euros was shipped there, though this represented only 40% of the value of the licenses granted. Licenses intended for the U.S. had significantly higher export potential—nearly 6 billion euros—but the value of actual exports amounted to just 118 million euros, or less than 2% of the projected figure.

One interesting example is the case of Latvia—although the value of the three export licenses did not exceed 13 million euros, actual sales amounted to over 17.5 million, according to the report.

Benefits of Exporting

Despite the difficulties, selling arms to allies remains a very advantageous option—mainly because it allows for the continued operation of factories producing components and systems, as well as for securing funding from foreign budgets.

For companies, this also presents an opportunity to further develop technology—often co-financed by other countries—and to establish contacts and collaborations, such as through training programs or equipment testing.

It is hard not to notice that any country in a similar situation would reach the same conclusions—especially if the risk of the weapons sold being used against it is negligible. Even in the event of an armed conflict, foreign supplies could ensure access to systems that are well-known and widely used by the Polish armed forces, and domestic development supported by external funding could allow the budget to be redirected to other purposes without concerns about the profitability of the plants.

Expert Opinions

In an interview with the editorial staff Money on the growing importance of the defense industry in the European Union, the former head of National Security Bureau, General Stanisław Kozieja, spoke to the editorial staff ofMoneyabout the growing importance of the defense industry in the European Union. According to him, Polish production is currently not competitive, mainly due to years of neglect. He sees an opportunity for recovery primarily in EU funds and cooperation with European companies, especially in sectors such as drones, ammunition, long-range systems, and cybersecurity.

The general emphasizes that Poland should be at least “co-owner” of the weapons it uses, in order to avoid a situation in which the manufacturer has the ability to block their use.

A similar position was also recently presented by Bank Gospodarstwa Krajowego. During a conference in Bukowina Tatrzańska, a member of the management board of BGK — Jarosław Dąbrowski — announced support for the “dual-use” sector—that is, technologies intended primarily for civilian use but which can also be used for military purposes. Examples include drones, radars, and radar technologies, which are also used in long-range systems and cybersecurity.

Export Potential

To the Editor Money Retired Colonel Artur Goławski, former spokesperson for of the General Command of the Armed Forces. His opinion—much like that of General Kozieja—does not inspire optimism. According to Goławski, Polish exports are currently limited to communications, reconnaissance, and air defense systems manufactured by WB Electronics in Ożarów Mazowiecki, as well as the “Piorun” (GROM-M) portable missile systems, manufactured by Mesko S.A. , which is part of the PGZ-AMUNICJA, which was recently mentioned in the context of domestic production of 155 mm ammunition.

What, according to Goławski, could enhance Poland’s arms export portfolio in the future? First and foremost, infantry fighting vehicles “Borsuk”—amphibious armored vehicles that have been under development since 2014 by a consortium led by Huta Stalowa Wola (with participation from, among others, Rosomak S.A., Warsaw University of Technology and the Military University of Technology). Nevertheless, the the Polish Armed Forceshave priority in acquiring them. According to information from the defence24 from late March, the military is set to receive the first 111 units by 2029—which pushes the prospect of their export into a future that is even more difficult to analyze.

The second segment that could boost Polish exports is air defense systems—the “PSR-A Pilica.” This domestic project, launched in 2006 by the Military University of Technology, aims to create a Polish air defense system. Its operational range, depending on the ammunition used, is between 2,000 and 5,500 meters. The first six systems were delivered to the army at the end of 2023, in accordance with the contract with the PGZ-Pilica signed in 2016.

Nevertheless, the limited number of systems available to the Polish Armed Forces suggests that significant increases in exports will have to wait—authorities generally tend to want to fully equip their own military with equipment whose production was also funded from the state budget before it is sold on foreign markets—even to allied nations.