Albania has approved its state-owned enterprise KAYO to manufacture and market weapons, ammunition, and defense equipment as part of a broader initiative to strengthen the country’s defense industrial base. The Council of Ministers’ decision enables KAYO to engage directly in production and sales, either independently or through subsidiaries, supplying Albanian defense institutions and other government agencies. Under the new regulation, all national security and defense bodies must first approach KAYO for their equipment requirements before initiating public procurement. If the company cannot meet requests within 30 days, traditional procurement channels can resume. Once production readiness is confirmed, KAYO and client agencies can negotiate contracts directly. The move marks a key step in Albania’s efforts to revive its dormant defense manufacturing sector. The government has prioritized restoring production at facilities such as the Polican munitions plant, once a major ammunition site during the communist era. In 2024, Tirana advanced modernization plans for these factories, seeking foreign partnerships to resume small arms and light weapon production. Additionally, the government signed an agreement with NATO’s Support and Procurement Agency to upgrade ammunition storage and logistics infrastructure to alliance standards. Plans are also underway to rehabilitate the Gramsh weapons plant, historically known for producing Kalashnikov rifles, to handle maintenance and assembly of modern firearms. Through these initiatives, Albania aims to reestablish a modest but capable defense industry, improving self-sufficiency and supporting NATO interoperability.
