Ukraine will buy 20 Gripen aircraft and Sweden will donate another 16 fighter jets.

Ukraine will buy 20 new Gripen fighter jets and Sweden will donate 16 of an older model next year, as announced by the President of Ukraine, Volodymyr Zelensky, and the Prime Minister of Sweden, Ulf Kristersson, in a joint press conference on Thursday.

The two leaders signed a letter of intent last year, paving the way for Sweden to sell up to 150 Saab Gripen E model fighter jets to Ukraine, although deliveries of the newest model will take several years.

These aircraft are a priority for Ukraine's fighter fleet, and the country's defense minister stated in May that an agreement for the Gripen E could be signed "in a matter of months" after the European Union approved a loan of 90 billion euros (about USD 104.7 billion) for Ukraine. "The Gripen is the best option for Ukraine. That's why, today, we are taking an important step on this joint path," Kristersson declared at a press conference alongside Zelensky at the Uppsala air base, where two Gripen aircraft were displayed. Saab shares, the manufacturer of the Gripen, rose 4.4% following the announcement of the agreement with Ukraine, leading the gains in Europe.

“We need these planes and for us this represents a new chapter for Ukraine”, stated Zelensky, adding that they plan to acquire the 150 aircraft stipulated in the original letter of intent. “With God's help, we will have sufficient funding,” he assured.

The transfer of older C/D model Gripen aircraft offers a provisional solution for Ukraine's air defense in the meantime.

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Zelensky indicated that Ukraine had allocated 2.5 billion euros (about USD 2.9 billion) from a loan package from the EU of 90 billion euros (about USD 104.7 billion) for the purchase of these aircraft. Deliveries of the new model are expected to reach Ukraine from 2030.

A key day for Saab

The shares of Saab rose 4.4% at 11:41 GMT, becoming the company with the biggest gain in Europe. Saab CEO, Micael Johansson, stated that it was an important day for the company and that the agreement further boosted interest in the Gripen. The agreement with Ukraine strengthens the Swedish defense industry, which has increased its production and exports following the Russian invasion. (Reuters) "The more countries that select the Gripen fighter... and it begins to operate in more countries, the more people will understand the fantastic capability it represents," Johansson told Reuters at the air base in Uppsala. Sweden is one of the largest contributors to Ukraine and has sent to date 128 billion Swedish krona ($13.75 billion) in military and civilian aid. It has also allocated 80 billion Swedish krona ($8.608 billion) in aid for this year and next. The Ukrainian air force is composed of a combination of Soviet-made and Western aircraft. The Gripen is considered a cost-effective alternative to fighters such as the more advanced American F-35, as it is easy and quick to maintain and can operate from dispersed air bases, such as conventional roads. For Sweden, the agreement also offers an opportunity to leverage its significant defense industry, which has seen a considerable increase in demand since the Russian invasion of Ukraine.