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10 major UOP changes in 3.5 years
Over the past 3.5 years, UKROBORONPROM (UOP) has undergone radical changes, which became the foundation for the further development of the largest association of state enterprises of Ukraine’s defense industry. Over the past 3.5 years, UKROBORONPROM has been steadily changing under warfare conditions, adhering to transparency, introduction of NATO standards, the use of modern business governance models, engaging private enterprises, and transition from the repair of old Soviet military equipment to high-tech developments. This was reported by Roman Romanov during the meeting of UOP Supervisory Board, member of which - on UKROBORONPROM initiative - was appointed Anthony Tether – former head of the Defense Advanced Research Projects Agency (DARPA). Equipped Army UOP enterprises 100% fulfilled all State defense orders, having transferred armored vehicles, aircraft, helicopters, air defense systems, artillery systems, missile weapons and other armament samples to the military. Starting from 2014, Ukrainian Army received from UKROBORONPROM 18,615 units of military equipment and weapons, of which 6,025 - totally new and modernized samples. During intense fighting, UOP specialists worked directly in the ATO zone as part of the mobile maintenance crews, restoring military equipment, destroyed in battles. These maintenance crews repaired more than two thousand pieces of military equipment in the field conditions. Despite the limited resources and the ongoing war, over the years, UKROBORONPROM moved from repairing Soviet military equipment to development of new advanced models of weapons and military equipment. In recent years, AN-132D aircraft and UAV "Horlytsya" performed their first flights, missile system “Vil’kha” and cruising missile under "Neptune" project were tested, as well as dozens of other weapons, intended, first of all, for the Ukrainian Army. The Ukrainian Army began receiving high-precision anti-tank missiles "Stugna" and "Corsar", the most protected armoured vehicles BTR-4, modernized combat helicopters and aircrafts. And if in 2014 the army received weapons, barely enough for one platoon, today UKROBORONPROM transferres military equipment in battalion sets. At UOP expense UOP share in the State Defense Orders, for all time amounts to 59.6%, according to which UOP enterprises received from the Ministry of Defense, the National Guard and other law enforcement agencies UAH 15.8 billion. At the same time, UOP enterprises from 2014 paid taxes and fees to the budgets in the amount of 17.2 billion UAH. UKROBORONPROM itself, thanks to its economic activity, paid for each unit of armament, manufactured for Ukrainian military under the State Defense Order, while paying for all necessary materials, for water and light, paying wages and additionally transferring 1,4 billion UAH to the budgets. From losses to billions in profits Talking numbers. In 2014, UOP enterprises had 0.92 billion UAH of losses, and, according to operative data of 2017, the net profit of the UOP enterprises in 2017 amounted to 1.5 billion UAH. At the same time, net income in 2014 amounted to 16 billion UAH, in 2017 this figure has almost doubled to 28 billion UAH. And the average salary at all UOP enterprises increased almost three times and now amounts to UAH 9,018, which is 36% higher than the average for Ukraine. Economy driver Having turned from unprofitable enterprises to industrial leaders of their regions and budget-forming enterprises for cities, UOP enterprises became a true driver of the economy. While in the expenditure part of Ukraine’s budget there is no line with the word "Ukroboronprom", the UOP itself paid from 2014 to 2017 over 17.2 billion of taxes and fees to the budgets of all levels. Only 7 UKROBORONPROM enterprises of Mykolayiv region paid more than 2.5 bln taxes, and 5 enterprises of Kharkiv region - 1.8 bln. Even the newly launched enterprise "Electric Systems" – the one that released its first products in October 2017, already enriched budgets by 12.6 million UAH. Engaging private enterprises in import substitution program 2014 became the year of breaking powerful chains, which united the Ukrainian defense industry with Russia. The import substitution program, launched by UKROBORONPROM, relied on the capacity of hundreds of Ukrainian enterprises, not members of the State Concern; these enterprises supplied a wide range of components. Currently, 447 enterprises throughout Ukraine, of which 65-70% are small and medium-sized businesses, supply more than 4,5 thousand units of products and components, that are of vital importance for Ukraine's defense capability. In fact, import substitution program allowed UKROBORONPROM not only break dependence from the Russian Federation, but also attracted Ukrainian private business to work for Ukraine's defense capability. Radical transparency Two years before Prozzoro became obligatory, in 2014 UKROBORONPROM introduced e-procurement system at its enterprises. In fact, this system became the basis for Prozzoro. UOP is the first one among the industrial associations, having made procurement system transparent and open. This solution allowed UKROBORONPROM to save more than 1.4 billion UAH, 40+ thousand suppliers were registered and more than 96 thousand tenders were conducted. And for all this time, UKROBORONPROM has not classified any procurement. UOP Anti-corruption program In 2014, one of the main tasks for UOP headquarters was fighting corruption at UOP enterprises. In addition to transparent e-procurement, it was decided to create a special internal service that will collect materials on violations and inform the law enforcement agencies. Thanks to work of UOP internal service, since 2014, 185 materials on violations at UKROBORONPROM enterprises were collected for the total amount of UAH 950 million. All these materials were transferred to the Security Service of Ukraine, the Prosecutor's Office, the Ministry of Internal Affairs and other law enforcement agencies, becoming the basis for 42 criminal proceedings. At the same time, 28 heads of UOP enterprises were suspended from office, and another 70 officials were brought to disciplinary responsibility. The first international audit UKROBORONPROM will become the first state industrial association in the history of Ukraine that will undergo international audit, which is one of the main conditions for the large-scale transformation of the State Concern. Up to now, no one has attracted top-level world-class consulting companies under open transparent tenders. These measures will contribute to creating the most effective means for the development of the entire defense industry and for further Euro-Atlantic integration of the entire defense-industrial complex of Ukraine. This will allow to transparently and rationally evaluate all UKROBORONPROM assets, to develop a clear plan for corporatization UOP enterprises with the further possibility of creating effective production clusters. This will enable the State Concern to create transparent management structures, attract private investors and integrate the Ukrainian defense industry into the global system and market. NATO standards Since 2014, transition to NATO standards was the only vector for development of all UOP enterprises. As a result, weapons, adapted to Alliance criteria – primarily aviation and armored vehicles - are already being developed in Ukraine. UKROBORONPROM participates in NATO programs: from NIAG research and joining NSPA's supplier base, to obtaining NATO certificates: combat aircraft and helicopter modernization. Implementation of air transportation under the SALIS program takes a separate position in a number of joint programs. It is in recent years that UKROBORONPROM has consistently participated in joint developments with NATO member states, including creation of new battle tanks, military transport aircraft, artillery systems, surveillance and reconnaissance, small arms and other weapons. Projects, that ten years ago seemed unreal today are implemented. New production and education For the first time in years of Ukraine's independence, UKROBORONPROM began to develop production facilities. Over the past 4 years, new technological lines, workshops have been opened, perhaps for the first time in Ukraine's independence, the country's defense complex has started to build muscle. Moreover, this year UKROBORONPROM launched a new enterprise - State Enterprise "Electric Systems", which will employ 2.5 thousand specialists and fill the budget of Ukraine with millions of tax deductions. At the same time, UKROBORONPROM and leading Ukrainian universities began expanding cooperation: students and teachers joined the process of development and production of armament. More than 9 thousand students had their practical training at UOP enterprises, of which more than 750 were employed. All these changes are the result of 80 thousandth UOP team - working at over 130 enterprises of the State Concern - implemented in the most terrible time of Ukraine's struggle against the aggressor country for its territorial integrity and its existence in general. UOP Supervisory Board approved the report of Roman Romanov, making a point that the enormous work was carried out by the ex-head of the State Concern and his team. "The changes are striking, we are grateful to Roman Romanov and his team for their work," said Mykhaylo Zhurovs’kyy, Chairman of UOP Supervisory Board. In turn, Anthony Tether also noted the tremendous UKROBORONPROM progress in 3.5 years.
CONCERNING PUBLICATION IN NEW YORK TIMES AND MISLEADING INFORMATION
Due to the fact, that New York Times published about Ukroboronprom’s activities and since there is some information misleading, we would like to emphasize on the following. Dmytro Maksymov who was referred to by New York Times concerning aircraft manufacturing plant in Lviv, May 11, 2017 attempted to smuggle documents with level restricted access, and he was caught by Security Service of Ukraine and Police, who arrived to the place of the accident. Mr. Maksymov was fired due to systematic failure to fulfill his official duties. It is worth to highlight, that Dmytro Maksymov in late 2016 refused to go on business trip for audit of financial and economic activities particularly at State Enterprise “Liviv State Aviation Repair Plant”, and for this reason he got a reprimand. Concerning SE “Lviv State Aviation Repair Plant”, as it was previously mentioned, as a result of internal control of Ukroboronprom, in autumn 2017 the facts of violation and faults were determined in financial and economic activities, as well as possible abuse by top management of the company. Based on results of the official investigation, the director of the enterprise Oleksandr Kravchuk was brought to justice. Disclosed materials on the embezzlement in 2016-2017 by the officials of the State Enterprise "LSARP" of funds during the purchase of inventories in interrelated commercial structures (in total 5) - were passed to the General Prosecutor's Office, the NABU and the Security Service. As of now, law enforcement agencies do the investigation by open criminal proceedings. The fact of dismissal of Alexander Kravchuk from his position was filmed by the press office of Ukroboronprom and distributed by many Ukrainian media. In this regard, we must emphasize that because of the internal control measures of Ukroboronprom since 2014, 185 materials were passed to law enforcement agencies with signs of abuse and corruption at the enterprises of "Ukroboronprom". For them, 42 criminal proceedings were initiated. By managerial decisions, 28 managers of enterprises were dismissed, and another 70 officials were brought to disciplinary responsibility. The negligence of these facts and spreading misleading information on anti-corruption actions of "Ukroboronprom" is unacceptable.
UOP Supervisory Board is finishing selecting candidate for the position of UOP Director General
Due to the fact that Roman Romanov's resignation letter was submitted at the end of 2017, and yesterday the President of Ukraine signed the decree, UKROBORONPROM (UOP) Supervisory Board is finishing the process of selecting a candidate for the President of Ukraine to appoint a new Director General. "I want to thank Roman Romanov, who is leaving this post. He had to work during the the most difficult years for our country: Dramatic transformations in the domestic defense sector took place during this time. Ukrainian defense industry in 2014 and today – it's like night and day. Paced work of the factories, implementation of the State Defense Order, successful implementation of the import substitution program, building missile shield and the latest developments - all of these create an integral system of positive changes, achieved by the team of Roman Romanov. It's a pity to lose a highly professional manager. There’s no doubt that Roman Romanov will receive cooperation offers from a number of domestic and foreign companies. Now the joint task of the UOP team is to continue the reforms and ensure the further growth of the State Concern. Openness, efficiency, and innovation are three key principles that should be laid in the basis of further progress of the domestic military-defense complex", - said Mykhaylo Zhurovs’kyy, Chairman of UOP Supervisory Board.
STATEMENT OF UKROBORONPROM DIRECTOR GENERAL ROMAN ROMANOV
I made my decision to leave my post as the head of the SC “UkrOboronProm”. I wrote a resignation letter last year and I hope that the President of Ukraine Petro Poroshenko will support my decision. In order to immediately put aside a set of questions, I have to emphasize several important positions. We have won. By saying “we” I mean all 80 thousand UKROBORONPROM employees, who managed to transform the biggest defense union of Ukraine into an effective mechanism, which – in parlous times - supplied our defenders with armament that helped them to defend our country. We remember the year 2014: Ukrainian Army had no modern combat vehicles, no communications equipment, no drones. We remember that just 3.5 years ago we were reviving idle defense enterprises and repairing destroyed in battles military equipment directly in the ATO zone; transferring tanks - barely enough to cover the needs of several platoons. Today, the true assessment of 3,5 years of UKROBORONPROM's work is more than 16,000 units of armaments and military equipment, transferred to the Armed Forces of Ukraine, the National Guard, State Border Guard Service and other law enforcement agencies, in accordance with the State Defense Order, fulfilled 100%. Over 12.5 billion UAH of taxes paid to the budgets of all levels; while - within the framework of the State Defense Order - UKROBORONPROM received 11.7 billion UAH. We completely broke ties with the Russian military-industrial complex. The import substitution program was launched at full capacity, with almost 500 private enterprises throughout Ukraine, replacing the components from the Russian Federation. We reached agreements with the leading companies from the USA, Germany, Canada, Britain, Poland and many other countries. Some of them are already attracted to mutually beneficial cooperation and agreements with the rest of those will be announced in the near future. For the first time in the history of Ukraine, we launched a large-scale defense industry reform, creation of clusters and corporatization of enterprises. We introduced changes in the environment of a globally distorted information field and post-truth. We tested new armament samples, from armored vehicles to UAVs, designed in accordance with the NATO standards, instead of repairing Soviet military equipment. The "Missile Shield" program: a dozen of UOP enterprises are elaborating on the creation of high-precision long-range missiles. There are many other achievements that laid the foundation for systematic expansion of results for many years to come. Implementation of integrity, honesty and transparency policies is of key importance to me. And all of those we introduced in UKROBORONPROM. The Concern became the first state industrial union of Ukraine, having launched e-tendering system, which helped to save more than 1.4 billion UAH, starting in 2014. UKROBORONPROM received the Supervisory Board, under the supervision of the rector of the National Technical University of Ukraine "Kyiv Polytechnic Institute named after I. Sikorsky" Mykhaylo Zhurovs’kyy. On the initiative of UKROBORONPROM, Anthony Tether – former head of the Defense Advanced Research Projects Agency (DARPA) – was appointed as member of UOP Supervisory Board. And I believe that together with UKROBORONPROM specialists, graduates of KMBS, MIM-Kyiv, Kyiv Polytechnic and many other leading universities of Ukraine, scientific thought, modern business models and advanced experience will allow us to move even faster. Throughout the years of my work at UKROBORONPROM, the media kept reminding me that I had come to the State Concern from business. It's true. And I believe that every man must devote certain period of his life to serve his country: Past 3.5 years were my service. I am grateful to each of the 80,000 employees of the SC "UkrOboronProm," who believed in country's defense industry revival. I am confident that my successor will continue this course. And I will smoothly hand over all the responsibilities, so that this transition in no way affects the efficiency of the work of the Concern. Our team gave a powerful impetus to the development of both the Ukrainian defense industry and the entire economy of the country. We understand how - in a couple of years - to create a defense industry that will ensure the independence and territorial integrity of any country. I am grateful to everyone who put their trust in us.
Combat module "Taipan"
In the framework of international exhibition "Arms and Security" (Kiev) Ukrainian public premiere of the combat module "Taipan" - developed by UOP SE "SpetsTehnoEksport" - was held. Specifications of the new combat module "Taipan" meet the highest Western standards. Installed system of backlash planetary gearboxes and ac converter-fed motors, provide precise targeting at ultra slow and high speeds make combat module “Taipan” unique. Owing to modern electronics, "Taipan" provides automatic targeting, keeps armament in the defined position, regardless repositioning of the combat vehicle’s hull in motion, providing automatic tracking of a target. Automated targeting system - with allowance for weather, projectile type, armament type, angular velocity and target range - is installed into the combat module. Also fighting module installed automatically issuing commands guidance given weather conditions, such as shells, type of arms, angular velocity and range goals. Sight system can be adjusted both to the line-of-sight and horizon line. Currently, “Taipan” is equipped with a rapid-fire cannon caliber double-barreled 23 mm, the effective range of which reaches 1.8 km. Other combat module modifications can be equipped with a machine gun 7.62 mm or 12.7 mm, and 30 mm grenade launcher with a separate elevation drive unite. The minimum weight of the combat module is only 350 kg. In addition, this module can be mounted not on mobile platforms only, but also equip fortified structures - such as checkpoints - controlling the module remotely, or use it as a SAFU without power supply, the combat module "Taipan" can work 3 hours in such a mode. “Together with our Ukrainian partners we have created combat module technical characteristics of which will arouse Ukrainian armored vehicles producers’ interest. Moreover, all the electronics and software are designed by Ukrainian specialists”, – said director of SFTE “Spetstehnoeksport” Pavlo Barbul.
UKROBORONPROM State Enterprise "Zhytomyr Armored Plant" adapted German Deutz engine for use in infantry fighting vehicles. Modernized infantry vehicle received its official name BMP-1UMD. The first public demonstration of BMP-1UMD took place at the exhibition "Arms and Security", October 11 at the International Exhibition Center in Kiev. Works on Russian UTD-20 replacement by Deutz TCD2013 L64V took only three months. This 4-stroke, 6-cylinder turbosupercharged engine with electronic control unit has 330 hp power, with the possibility of increasing power up to 390 hp, while UTD-20 engine has only 300 hp. In addition, the German engine has significantly more resources it quieter and more economical. "Infantry fighting vehicle adaptation for German Deutz engines use is another step in UOP import substitution program fulfillment. Other Ukrainian armored vehicles such as BTR-4 - produced by SE “Kharkiv Morozov Machine-Building Design Bureau” - are equipped with engines of this manufacturer,” - said the head of the SC" UkrOboronProm" Roman Romanov. Works on improvement of firepower, fire control, ergonomic and functional characteristics of the vehicle were carried out when working on BMP-1UMD. Special attention Ukrainian specialists paid to camouflage in visible and IR band.
PHANTOM – WARRIOR OF THE FUTURE. PUBLIC PREMIERE AT "ARMS AND SECURITY"
"Phantom" is one of the most advanced developments of UKROBORONPROM SE "SpetsTehnoEksport". It is the first step in development of advanced systems that will replace traditional armament. The first public demonstration of tactical unmanned multipurpose vehicle "Phantom" took place at the exhibition "Arms and Security", which started on October 11 at the International Exhibition Center in Kiev. "Unmanned multipurpose tactical vehicle" Phantom" is a response to the challenges of technological era, pressing its demands to creating entirely new armament types: unmanned, multi-functional and capable of performing tasks that are now performed by soldiers only, endangering their lives. These are the characteristics, demonstrated by "Phantom", "- said the head of the SC "UkrOboronProm" Roman Romanov, explaining the peculiarities of the new unit of the military equipment. Tactical Unmanned multipurpose vehicle “Phantom” is a remotely operated mini armored carrier. Day and night sighting systems allow to fire at any time of the day for a distance of over 1 km. Its operational range is up to 20 km, it is operated by means of secure radio channel or via fiber cable of 5 km length. “Phantom” can transport ammunition, retrieve wounded from the battlefield and perform combat missions. "Phantom" capabilities are difficult to overestimate: they allow him to perform a wide range of tasks. This equipment can deliver ammunition and loads across the areas that are under the threat of enemy fire, or at risk of mining, to safely and quickly evacuate wounded from the battlefield. Different types of armament can be mounted on "Phantom" for fire support. For example, if "Phantom" is equipped with anti-missile system - the army receives nearly invisible, mobile and effective means of enemy armored vehicles’ destruction,"- said the head of SE "SpetsTehnoEksport" Pavlo Barbul. The XIII International Specialized Exhibition "Arms and Security - 2016" will be held 11-14 October 2016 at the International Exhibition Center, which is located at Brovary Avenue, 15.
UKROBORONPROM FULFILLED STATE DEFENSE ORDER: 3673 UNITS OF weapons and military equipment TRANSFERRED
APC 4МВ1 IN ACCORDANCE WITH NATO STANDARDS
Ukrainian UAV "Horlytsya": First flight
UKROBORONPROM REPRESENTS UKRAINE AT “DEFENSE & SECURITY-2017”
M4 – WAC-47 carbine submachinegun testing
UKROBORONPROM TESTS TANKS BEFORE TRANSFERRING THOSE TO THE ARMED FORCES OF UKRAINE
UOP innovations in the 1st quarter of 2017
APC 3DA with COMBAT MODULE “SHTURM” – VIDEO
“SHKVAL” AND “STILET” FIRING TRIALS
An-132D: preparing for tests
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