Tallinn: Estonia’s Defence Minister Hanno Pevkur has resigned after a Euro 70 million ammunition procurement for Ukraine triggered an official scandal, audit criticism and a criminal investigation.
Pevkur announced his resignation on 2 September, saying he was taking political responsibility for problems within his ministry. The decision followed criticism from Estonia’s National Audit Office over defence spending and the handling of military procurement.
At the centre of the controversy is a contract awarded to Datasel, an Italian registered company acquired by Indian defence firm Neco Defence Munitions. Estonia’s Centre for Defence Investments transferred around 70 million Euros in advance for artillery ammunition intended for Ukraine, using funding from the European Peace Facility.
The procurement was intended to provide ammunition for Ukraine, but the contract was terminated after disputes over delivery, quality and compliance. Estonia has sought the return of the advance payments and taken the dispute into legal proceedings and international arbitration.
Datasel has rejected Estonia’s account of the failed deal. The company says it delivered a significant quantity of ammunition worth around 59 million Euro and argues that it could have fulfilled the remaining obligations had Estonia not terminated the contracts. The company is pursuing its own claim against Estonia.
The controversy has also raised questions about how the contractor was selected and why concerns over the company’s ability to supply artillery ammunition were not identified earlier. Reports indicate that the companies involved had no established track record of producing or selling artillery shells before the agreement.
Estonia’s prosecutor’s office has opened a criminal investigation into issues raised in recent reports, while authorities continue efforts to resolve the financial dispute.
Pevkur said he had not been personally involved in negotiating individual procurement contracts but accepted political responsibility as defence minister. The case has now become a wider test of Estonia’s defence procurement controls as the country rapidly increases military spending and support for Ukraine.
