A surprising contradiction in Spanish policy has emerged this week, with Israeli business outlet *Globes* revealing that a Spanish-headquartered arms manufacturer has begun shipping infantry fighting vehicles fitted with Israeli-made weapons systems to Latvia – 12 months after the Spanish government implemented a full arms embargo against Israel over its military campaign in Gaza.
The €800 million ($929 million) contract, which Latvia signed with General Dynamics European Land Systems-Santa Barbara Sistemas (GDELS-SBS) in 2025, calls for 84 custom-built Mednieks infantry fighting vehicles to be delivered by 2029. What makes the shipment controversial is that each vehicle is fitted with the UT30 MK2 unmanned turret system, produced by major Israeli defense contractor Elbit Systems. The contract also reserves at least 30 percent of manufacturing work for Latvian domestic industries, and the vehicles have been designed specifically for interoperability with NATO alliance equipment, per GDELS-SBS’s official specifications.
Latvian Defense Minister Raivis Melnis welcomed the first deliveries last week, framing the new vehicles as a critical boost for his country’s national defense. “The arrival of these Mednieks fighting vehicles is a major milestone in strengthening Latvia’s defense capabilities,” Melnis said. “They will reinforce our national armed forces and deepen military cooperation between our military and our NATO allies.”
The controversy stems from Spain’s formal arms embargo against Israel, implemented by Prime Minister Pedro Sanchez’s center-left government in 2025 in response to the ongoing Israel-Hamas war in Gaza. The embargo, which passed into law through the Spanish parliament, bans all imports and exports of military equipment, technology, and dual-use materials between the two countries, and the Spanish government already terminated three major Israeli arms contracts worth hundreds of millions of dollars shortly after the embargo was announced. Yet the current shipment exposes a loophole: GDELS-SBS, originally a Spanish state-owned arms firm, was privatized and acquired by U.S. defense giant General Dynamics in the early 2000s, placing it outside direct government control over existing contracts.
This is not the first time the Sanchez administration has faced criticism over inconsistent enforcement of its Israeli arms ban. Early in 2026, the government came under fire for considering a military procurement from a firm partially owned by another major Israeli defense manufacturer, Rafael Advanced Defense Systems. Spanish defense officials have pushed back against criticism, saying they are working toward full “zero technological dependence” on Israel, with Defense Secretary of State Amparo Valcarce confirming in February that the country is systematically phasing out all remaining Israeli components from its domestic military supply chains.
For Israeli defense contractors, the deal marks another milestone in a period of unprecedented commercial growth. Since the start of the Gaza war in October 2023, Israeli arms firms have reported record revenues: Elbit Systems alone generated $7.9 billion in revenue in 2025, and posted a backlog of $32 billion in outstanding orders by the second quarter of 2026. Elbit president and CEO Bezhalel Machlis called the performance excellent, noting that strong demand for the company’s systems had sustained consistent growth through the first half of the year. The contract for the Latvian vehicle turrets was announced in April 2025, when Elbit secured a $100 million deal to supply the systems to GDELS-SBS for a NATO member country’s armored vehicle program. “This collaboration delivers advanced turret solutions that boost firepower, protection, and operational effectiveness for end users,” Yehuda Vered, general manager of Elbit Systems Land, said at the time.
Beyond the commercial and policy implications, the deal also underscores shifting defense ties in the Baltic region. While diplomatic relations between Spain and Israel remain strained over the Gaza conflict, Latvia has moved to deepen its own defense cooperation with Israel: Melnis traveled to Israel in September 2026 to meet his Israeli counterpart, Defense Minister Israel Katz, with the Israeli defense ministry confirming the discussions focused on expanding bilateral military collaboration. Analysts quoted in *Globes* note that General Dynamics’ established position across European defense markets creates a reliable channel for Israeli defense components and technology to access the continent, supported by close U.S.-Israeli security ties.
Gaza’s health ministry reports that more than 74,000 Palestinians, the majority of them women, children, and elderly people, have been killed in Israeli military operations in the strip since October 2023, with more than 175,000 others wounded. The 2024 University of Navarra analysis of Spanish arms trade found that despite repeated government pledges to suspend all military trade with Israel after October 2023, Spanish authorities awarded hundreds of millions of euros in new contracts to Israeli firms or their Spanish subsidiaries in the weeks following the start of the war, including a €697 million rocket launcher deal with an Elbit-led consortium and a €287 million anti-tank missile contract with a Rafael subsidiary.