Germany’s Merz arrives in Kyiv with €1.35bn aid package, drone deal in focus

Investing.com -- German Chancellor Friedrich Merz arrived in Kyiv on Sunday with new military and energy assistance, as Germany and Ukraine prepare to finalise an agreement to jointly produce drones and other weapons.

Merz is expected to announce the release of €1 billion in military aid and €350 million for repairs to Ukraine’s energy sector, German government officials said.

The visit comes amid escalating Russian attacks on Ukrainian cities and infrastructure. Merz said Ukraine would need continued support in the coming weeks and pledged to reassure President Volodymyr Zelenskiy of Germany’s commitment.

The chancellor travelled with Economy Minister Katherina Reiche and a business delegation including executives from Siemens Energy, Hensoldt, Diehl Defence and Quantum Systems.

A major focus is an expected agreement covering joint production of drones, missiles and related software. Zelenskiy said earlier this week that the two countries were close to finalising the arrangement.

The cooperation is expected to include rapid production of anti-jet drones. Quantum Systems has successfully tested the technology as Ukraine seeks additional ways to counter high-speed Russian attack drones.

Quantum and Ukrainian manufacturer WIY Drones formed a joint venture in April to produce the Strila interceptor drone and related air-defence technology.

The broader agreement also involves development and production of weapons with ranges exceeding 1,000 kilometres, giving Ukraine additional capabilities to strike targets inside Russia.

German officials said increased cooperation could direct technology and investment back into Germany’s defence industry and strengthen protection against drone threats to critical infrastructure.

Merz is also expected to press Kyiv for progress on reforms requested by European Union partners, including efforts to combat corruption.

Russia said Saturday it would continue striking targets in Ukraine, describing the attacks as retaliation for Ukrainian strikes on Russian territory. Zelenskiy separately said Ukrainian forces would intensify attacks on Russian oil refineries in response to Moscow’s strikes on civilian infrastructure.