What Sweden Can Learn from Ukraine’s Drone Industry
Sweden needs to reform its public procurement regulations and innovation system to better foster innovation and address future crises, according to a new study produced on behalf of IVA. The review examines how Ukraine has rapidly developed a dynamic drone industry in the midst of ongoing war.
Sweden needs an innovation system that can shift gears and deliver more quickly. Ukraine’s experience shows the importance of simpler procurement rules, digital platforms that open the door to new players, and a government prepared to back small, fast‑moving companies.
professor Sylvia Schwaag Serger, president IVA
Innovation under extreme pressure
After Russia's full-scale invasion in 2022, the number of Ukrainian companies engaged in drone production increased to around 2,500. This expansion was driven by newly established small enterprises rather than by the major players.
Ukraine’s wartime experience does not offer a blueprint to be copied. It does, however, provide rare empirical evidence on how industrial capacity and innovation emerge under severe constraints on time, capital, and institutional slack. In the UAV sector, Ukraine was forced to improvise, adapt, and reorganize production under sustained pressure, revealing mechanisms that are normally obscured in peacetime systems.
About the study
Wartime Industrial Dynamics and Resilience – How to Promote Entrepreneurship and Innovation During Crises is prepared by Maryna Brychko, PhD in Economics and Senior Researcher at Blekinge Institute of Technology, and Pontus Braunerhjelm, IVA Fellow and Professor of Economics at Blekinge Institute of Technology, on commission from IVA’s Entrepreneurship Academy.
The study is based on data from Ukrainian companies in the drone sector covering the period from 1991 to 2025, and spans three phases: the pre‑war period, the hybrid warfare phase from 2014 to 2022, and the period following the full‑scale invasion in 2022.
