Albania has taken a significant step towards bolstering its defense capabilities by granting its state-owned company, KAYO, the authority to manufacture and market weapons, ammunition, and military equipment. This decision is part of a broader initiative aimed at reviving the country’s domestic defense industry.
The Council of Ministers has officially approved this measure, allowing KAYO to engage in direct production and sales, or to operate through its subsidiaries. The focus will be on supplying not only domestic defense institutions but also other state entities. A new mandate requires all security and defense structures in Albania to consult KAYO prior to initiating public tenders for equipment and materials.
In a structured approach to streamline procurement, should KAYO be unable to fulfill requests within a 30-day timeframe, authorities are permitted to explore traditional procurement routes. Furthermore, upon readiness to supply, KAYO and the relevant agencies will have the flexibility to negotiate terms directly to finalize contracts.
The move to reinvigorate Albania’s defense manufacturing sector comes after years of stagnation. In 2024, the Albanian government initiated plans to modernize munitions factories established during the communist era, particularly in Polican, with the intention of restarting limited ammunition production. To enhance the capabilities for small arms and light weapons, the government is actively seeking foreign investment.
Additionally, the government has solidified a partnership with NATO’s Support and Procurement Agency, aimed at upgrading storage and logistics sites to align them with NATO standards. This agreement is part of a comprehensive effort to enhance the operational readiness and safety of Albania’s defense infrastructure.
Plans are also underway to rehabilitate the Gramsh weapons plant, which gained notoriety in the past for producing Kalashnikov rifles. The upgraded facilities are expected to support the maintenance and assembly of modern rifles and various components, further modernizing Albania’s defense arsenal.
These developments signal Albania’s commitment to strengthening its defense industry, increasing self-sufficiency, and aligning its military capabilities with international standards.
