Albania has authorized its state-owned defense company KAYO to produce and market weapons, ammunition, and military equipment, marking a major step toward reviving the country’s domestic defense manufacturing capabilities. The move, approved by the Council of Ministers, is part of a broader national strategy to rebuild defense self-sufficiency and strengthen industrial capacity for national and allied use.
Under the new directive, KAYO is empowered to conduct production, sales, and distribution either directly or through its subsidiaries, serving Albanian defense institutions and other state entities. All government security and defense organizations must now approach KAYO first for their equipment and material needs before initiating any public procurement.
If KAYO cannot fulfill a request within 30 days, the relevant authority may proceed with standard procurement processes. Once the company is ready to meet an order, it can negotiate directly with the requesting agency to finalize supply agreements, streamlining the acquisition process for locally made defense products.
The authorization follows Albania’s push to rebuild its long-dormant defense industry, which has remained idle since the post-communist transition. In 2024, Tirana advanced efforts to modernize old munitions factories in Polican to restart ammunition production and attract foreign investment for upgrading small arms and light weapons facilities. Additionally, Albania signed an agreement with NATO’s Support and Procurement Agency (NSPA) to upgrade ammunition storage and logistics sites to alliance standards. The government also plans to rehabilitate the Gramsh weapons plant, historically known for producing Kalashnikov rifles, to support modern rifle maintenance and assembly.
