Ukraine’s government approved a draft agreement with the United Kingdom on taking out a billion-dollar loan to build up the nation’s navy.

In the making since late 2020, the deal envisages a 1.25 billion pound ($1.6 billion), 10-year loan provided to Kyiv for procuring from Britain a number of warships, both new and used, as well as anti-ship missiles and equipment for naval bases.

The government decree was signed by Ukraine’s Prime Minister Denys Shmyhal on Oct. 28.

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The vast effort titled Ukraine’s Naval Capabilities Enhancement Program (UNCEP) was launched in October 2020. Following a number of memorandums signed by the two governments, the U.K. is ready to build two brand new Protector P-5oU platform missile boats for Ukraine’s navy. Six more vessels of the class can be built in Ukraine.

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The 50-meter, 500-ton warships are each expected to carry small and medium caliber artillery ordnance, eight anti-ship missiles and an air defense system. According to Britain’s defense attache in Kyiv, production will begin in early 2022.

British company Babcock won a contract and is expected to manufacture the vessels in the city of Rosyth in Scotland.

Previously it was reported that the company is going to produce Barzan-class patrol boats designed by Vosper Thorneycroft. According to later reports, Bobcat deemed the project unsuitable for Ukraine’s navy, allegedly due to the ship’s problematic aluminum frame.

As part of the Ukrainian-U.K. sea defense deal, the Royal Navy is preparing to provide Ukraine with two minesweeping ships: HMS Ramsey and HMS Blyth. The decommissioned vessels with nearly 20 years of service record will be repaired and modernized before being transferred to Ukraine.

In late October, the Ukrainian Defense Ministry also confirmed its talks with the U.K. regarding a possible sale of Brimstone Sea Spear maritime missiles designed by MBDA U.K. The deal envisages British contractors joining the construction of Ukrainian naval bases in Ochakiv and Berdyansk, which are expected to be completed by 2024.

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Both countries are also reportedly in talks on British participation in Ukraine’s effort to build a number of navy frigates.

According to a June report by Ukrainian Military Portal, a Kyiv-based defense news website, Babcock may help resurrect the construction of Volodymyr Velykiy, a problematic corvette building project, only 30% of which has been completed since 2011 due to scarce funding. Defense News, the U.S.-based military broadsheet, reported this June that Babcock may supply Ukraine with a brand new Inspiration-class (Type 31) frigate, which is expected to enter service with the Royal Navy in coming years. The company declined to comment on its frigate project for Ukraine, according to Defense News.

The U.K. in 2019-2020 joined an effort to help Ukraine resurrect its naval power against an increasingly aggressive Russia in the Black and the Azov Seas. With the 2014 occupation of Crimea, Ukraine lost nearly 80% of its naval capabilities and infrastructure, including ships, bases and naval aviation.

Since then, Ukraine has moved to develop a mosquito fleet by building a handful of gunboats and obtaining used patrol vessels form the US. Apart from the upcoming British supplies, the U.S. has provided Ukraine with two used Island-class patrol boats (with three more coming up), and with the approved sale of up to 16 new Mark VI vessels.

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Turkey in 2021 launched the production of an Ada-class corvette under a contract with Kyiv. The new ship is expected to be completed in 2022.

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