Estonian defense minister resigns amid procurement scandal involving ammunition for Ukraine (UPDATED)
Estonian Defense Minister Hanno Pevkur has announced his resignation amid scrutiny of the country's defense procurement system, including a controversial deal worth around €70 million for artillery shells intended for Ukraine.
UPDATE: The European Commission says it is examining the €70 million advance paid for ammunition for Ukraine that was never delivered and is in contact with Estonian authorities over the case. Commission spokesperson Christian Wiegand said Brussels could not yet determine whether Estonia would be required to repay the funds, which came from the European Peace Facility.
Pevkur, who has served as defense minister since 2022, said he was taking political responsibility for problems identified by Estonia's National Audit Office, even though he did not consider himself personally responsible for individual procurement decisions.
“A leader must have both the courage and the stature to take responsibility as a matter of political responsibility, even when there is no personal responsibility,” Pevkur told Estonian public broadcaster ERR.
The controversy includes contracts signed in 2024 by the Estonian Center for Defense Investments, or RKIK, with Italian-registered Datasel S.R.L., owned by Indian company Neco Defence Munitions. According to ERR, neither company had previously produced artillery shells.
Estonia made advance payments under the contracts using funding from the EU's European Peace Facility. The first batch of ammunition was expected to reach Ukraine in November 2024, but the supplier reported delays. Additional contracts were subsequently signed, with the value of advance payments reported at up to €70 million.
Pevkur later said around €60 million in advance payments were linked specifically to the supplier. Ammunition worth tens of millions of euros was eventually delivered to a warehouse in Europe but did not pass quality checks and was not sent to Ukraine. Estonia is now pursuing a legal dispute over the contracts.
Pevkur said the deal was part of a broader effort to urgently source artillery ammunition for Ukraine at a time of severe shortages. Some suppliers and countries did not want their involvement in deliveries to Ukraine made public, forcing Estonia to use intermediaries and accept higher procurement risks, he said.
According to Pevkur, Estonia handled around €500 million to €600 million worth of similar procurement contracts for Ukraine, most of which were fulfilled without comparable problems.
The National Audit Office has also raised broader concerns about accounting and oversight in Estonia's defense sector. Pevkur said that while ministers do not negotiate individual contracts, he was responsible for the institutions under his ministry and would therefore step down.
Prime Minister Kristen Michal will now have to appoint a new defense minister. Pevkur said he expects to remain in office until Estonia's parliament reconvenes on Sept. 14.
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