A N A LYS I S Defence Industry in Central Eastern Europe The Romanian Defence Sector: An Analysis of Industrial Capacity, Fiscal Challenges, and the Potential for European Cooperation Claudiu Degeratu 1. The Romanian Defence Sector: Context and Trajectory The New Geostrategic Imperative in the Black Sea Region Romania’s defence sector is in the midst of the most profound and urgent transformation since the country’s integration into Euro-Atlantic structures. The European security environment, altered by Russia’s full-scale invasion of Ukraine in 2022, served as a powerful catalyst, validating Bucharest’s long-standing strategic assessments and requiring a complete review of its defence posture(MApN, 2020; Stockholm International Peace Research Institute, 2018). Romania’s official position identifies the Russian Federation as a revisionist actor that uses hybrid warfare to undermine the European order, with the Black Sea region being an area of critical strategic importance and vulnerability (CSAT, 2020; Binnendijk et al., 2020). In response, the government followed a two-pronged strategy: the rapid modernisation of the Romanian Armed Forces to achieve full interoperability and credible deterrence within NATO, and the parallel revitalisation of the nation’s Defence Technological and Industrial Base(DTIB) (MApN, 2020). This strategy is fuelled by a baseline policy decision to increase the defence budget to 2.5% of GDP from 2023 onwards, a significant increase from the previous target of 2% set in 2015(Center for European Policy Analy sis[CEPA], 2020; GMFUS, 2024). Although the execution and absorption of these funds have faced challenges, the commitment signals a clear and sustained political will to allocate resources to the country’s defence ambitions. The Romanian Defence Sector 1

The Historical Legacy: From the Power of the Warsaw Pact to the NATO-Era Deployment The current state of Romania’s DTIB is a direct consequence of its development during the Cold War and its subsequent collapse(KPMG, 2025). During the Warsaw Pact era, Romania cultivated a large, largely self-sufficient and heavily export-oriented arms industry. Conceived under an autarkic model aimed at vertical and horizontal integration into the national economy, the industry was structured to equip the Romanian Army with systems produced domesti cally or under Soviet license, while at the same time gener ating hard currency through exports(Vasilachi& Vasilachi, 2021; Petrescu, 2018). At its peak, Romania ranked among the top ten arms exporters in the world, with its defence in dustry employing over 220,000 people and meeting a sig nificant part of the needs of the armed forces(IRIS, 2024). This period established a vast physical infrastructure for manufacturing everything from small arms to armoured vehicles and aircraft – a legacy that persists in the form of numerous factories spread across the country(Oprișor, 2024). The fall of the communist regime in 1989 and the dissolution of the Warsaw Pact triggered a“great disloca tion” from which the state sector never fully recovered (IRIS, 2024). The industry has faced a multifactorial shock: the collapse of its traditional export markets in the devel oping world and the Eastern Bloc; a drastic reduction in domestic demand, as the Romanian Armed Forces were re duced; and, most critically, a growing technological gap, as Romania has reoriented itself towards NATO(Epicenter Network, 2024). The industry’s production, built according to Warsaw Pact standards, was incompatible with NATO’s interoperability requirements. This shock was not only a market shock, but also a fundamental one related to standards and interoperability. The industry’s core competence – the production of equipment to Soviet standards – has become a strategic vulnerability, creating a much deeper and more costly barrier to modernisation than simply finding new customers. Lacking investment capital and a managerial culture capable of adapting to a competitive market, most of the state-owned industry has entered a prolonged period of decline, technological obsolescence and financial difficulties(KPMG, 2025). This historical legacy is not just a background detail; it is an active and continuous constraint. The managerial culture inherited from the planned economy persists in today’s state sector and does not prioritize innovation or efficiency(Sucală, 2018). This“Sovietized” culture, resistant to change and unsuitable for a market environment, is a key contributor to the current deficit of absorption capacity, manifested by bureaucratic delays and chronic underspending(IRIS, 2024; Epicenter Network, 2024). Thus, the historical managerial culture is a direct cause of the current inability to plan, execute and absorb modern, large-scale procurement projects, which creates a direct link between the points of failure of the past and those of the present. The Contemporary Industrial Landscape: A Forked, Two-Speed Ecosystem Today, the Romanian DTIB is best understood as a bifurcated structure, comprising two distinct segments with une qual performance. The central observation of this report is the accentuated dichotomy between a small number of pri vate or foreign-invested firms, which are globally competi tive and integrated, and a large state sector, which is stag nant and technologically outdated(IRIS, 2024). The state-owned sector remains the largest in terms of assets and employees, but it is the most problematic. It is dominated by the national holding company C.N. RO MARM S.A., which is subordinate to the Ministry of Econo my and controls 15 production subsidiaries focused mainly on terrestrial systems and ammunition(IRIS, 2024; Epi center Network, 2024). Other significant state entities in clude IAR S.A. Brașov, which specialises in the mainte nance and modernisation of helicopters, and the Bucharest Mechanical Plant, which is involved in the production and maintenance of armoured vehicles(IRIS, 2024). In stark contrast, the private and foreign-owned sec tor is made up of more agile, technologically advanced and globally integrated companies. This segment is led by key players such as: Aerostar S.A. Bacău, a formerly stateowned enterprise that has been privatized and has become a national champion in aerospace MRO and aerostructure manufacturing; Damen Galati Shipyard, the largest and most productive shipyard in the country(owned by the Dutch group Damen); and Elmet International SRL, the Ro manian subsidiary of the Israeli company Elbit Systems, which serves as a crucial integrator of advanced terrestrial systems(IRIS, 2024). The success of these private firms is not just a function of capital investment, but also of their fundamentally different business models, which involve ex port orientation and integration into global value chains. Damen builds almost exclusively for export(Damen, n.d.-a), Aerostar is a key supplier for Airbus and Boeing (Aerostar S.A., 2024), and Elmet is a regional hub for a global defence contractor(Elmet International, n.d.). A detailed examination of the leading companies within the Romanian DTIB reveals a striking performance gap between state-owned enterprises and their private or foreign counterparts. This two-speed reality – in which a few competing firms coexist with a struggling majority – is the central feature of the contemporary defence industrial landscape of Romania. The success of private and foreign-invested firms is directly attributable to modern management, access to global markets, and sustained investment, providing a clear blueprint for necessary reforms in the state sector. State-owned Enterprises: ROMARM Conglomerate and Its Legacy The state segment is dominated by C.N. ROMARM S.A., the holding company for 15 subsidiaries in the field of earth systems and ammunition. Although it is the designated vehicle for the government’s industrial strategy, ROMARM as The Romanian Defence Sector 2

a whole has struggled with profitability and modernisation (IRIS, 2024). Data from 2020–23 shows a volatile turnover, with a significant increase in 2022 followed by a decrease in 2023, indicating a reliance on large and scarce orders rather than a stable business model(IRIS, 2024). The hold ing’s management structure has been criticised for failing to drive effective reform within its component factories, which continue to operate with a high degree of autonomy and inefficiency(IRIS, 2024; Epicentre Network, 2024). The principal subsidiaries of ROMARM include: → Uzina Mecanică Cugir S.A.& Fabrica de Arme Cugir S.A.: These two entities in Cugir represent the historical heart of the production of small arms and infantry ammunition in Romania. While UM Cugir recorded strong turnover growth through 2023, the Arms Factory experi enced a decline, reflecting uneven performance even within the same industrial cluster(IRIS, 2024). Their technology is largely inherited, focusing on Warsaw Pact calibres and their derivatives, although some production of NATO calibres has also been introduced(IRIS, 2024). → Sadu Mechanical Plant S.A.: Another key ammunition manufacturer, its financial performance was modest compared to other ammunition factories, indicating significant operational challenges(IRIS, 2024). → Automecanica Moreni S.A.: The only manufacturer of armoured personnel carriers(APCs) in the country, its turnover remains extremely low, reflecting the lack of major orders(the last major indigenous project being the SAUR 2 APC prototype) and a primary focus on MRO for obsolete fleets(IRIS, 2024). Outside the ROMARM umbrella, IAR S.A. Brașov is an important state-owned aerospace company and a key partner for the Ministry of Defence in the modernisation of the IAR330 Puma helicopters(IRIS, 2024). Its turnover has seen steady growth, making it one of the best-performing stateowned enterprises(IRIS, 2024). In contrast, the modernisa tion program for the IAR-99 training aircraft, essential for the training of F-16 pilots, faces significant difficulties. Al though the contract was awarded to the state-owned com pany Avioane Craiova in partnership with Elbit Systems from Israel, the program accumulated significant delays, ex ceeding the contractual delivery deadlines and requiring multiple renegotiations(TVR Info, 2025a; Aviația Magazin, 2025). Disputes over software integration and homologa tion issues have blocked the delivery of completed aircraft, illustrating the systemic challenges faced by complex pro jects in the state-owned industry(G4Media, 2025). Meanwhile, several privatised or foreign-invested firms are highlighting the potential of the private sector: → Damen Galati Shipyard: Owned by the Dutch group Damen, this shipyard is the largest in Romania and a successful foreign investment model. It has a high production, delivering more than 450 ships since 1999, in cluding 30 military ships for 13 countries(Damen, n.d.-b). Its portfolio is diverse, covering everything from offshore patrol vessels to complex naval support vessels, all built for the export market(IRIS, 2024). This demon strates an advanced level of technology and integration into a global supply chain(IRIS, 2024). → Elmet International SRL: A subsidiary of Elbit Systems (Israel), Elmet is a critical technology partner in ad vanced terrestrial systems. It operates a production and integration facility in Magurele for sophisticated turrets and weapons stations, including those for the Army’s Pi ranha V APCs(e.g., the UT30 MK2 turret and the SPEAR mortar system)(IRIS, 2024; Elbit Systems, 2023a). This role exemplifies a successful model of technology trans fer and local production linked to a major government procurement program. The following table provides a concise comparison of the leading industrial players, illustrating the performance gap between the state and private sectors: The Romanian Defence Sector 3

Profile of the Main Defence Companies in Romania (Latest data available, fiscal year 2023, unless otherwise specified) Table 1 Company Name Main Defence Turnover Products(Year) Employees (Year) Property Technological Level Flagship Programs/ Products Export Activity(Key Markets) C.N. ROMARM S.A.(Holding) Armoured vehicles, ammunition, artillery, small arms RON 495.1 M (2023) ~7,000 (est. group) State (100%) Legacy/ Environment TR-85-M1 tank, APC SAUR 2, ar tillery ammunition Asia, Africa, Middle East (historical) Cugir Mechani cal Plant S.A. Small arms, ammunition, components 229.3 M RON 916 (2023)(2023) State (RO MARM) Inherited AK rifles, NATO and Warsaw Pact ammunition Civil Markets (USA); some military ex ports IAR S.A. Brașov MRO& Heli copter Upgrades, Aircraft Components 427.5 M RON ~1,200 (2023)(est.) State (72%) Medium Upgrades IAR-330 Puma SO CAT; IAR99 SM up grades Limited de fence exports Aerostar S.A. Bacău MRO F-16, military aircraft upgrades, aerostructures 506.3 M RON(2023) 1.846 (2023) Private (71% românesc ) Advanced F-16 Main tenance Centre; sup plier for Airbus/Boeing Europa, America de Nord, Asia (civil& apăra re) Şantierul Naval Damen Galați Naval plat forms(frig ates, corvettes, OPVs), support ships €389.2m (2021) 1.700 (2021) Private (Damen Group, NL) Advanced SIGMA class frigates; Global Marine OPVs Worldwide (Netherlands, Pakistan, etc.) Elmet International SRL Turrets, weap ons stations, mortar systems, systems integration €109.9m (2021) ~400+ (est.) Privat(El bit Systems, IL) Advanced UT30 MK2 turret; SPEAR mortar for Piranha V Hub regional for Elbit Systems Carfil S.A. Grenade launchers, ammunition, pyrotechnics 96.6 M RON ~300 (2023)(est.) State (RO MARM) Inherited AG-7/AG-9 grenade launchers; Mortar pro jectiles Limited Sadu Mechani Infantry amcal Plant S.A. munition 50.7 M RON ~500 (2023)(est.) State (RO MARM) Inherited Small Ammunition (NATO& Warsaw Pact) Limited Source: Own elaboration based on data from IRIS(2024), Aerostar S.A.(2024), Damen(n.d.-b; 2022), and Elbit Systems(2023a). The Romanian Defence Sector 4

2. In-Depth Sector Analysis: Strengths, Gaps and Clusters Romania’s DTIB capabilities are concentrated in several key sectors, each with distinct characteristics, top firms, and critical gaps that the new national strategy aims to ad dress: Terrestrial Systems: → Capabilities: Strengths include the production of small arms(AK-type rifles and pistols), infantry ammunition, and anti-tank grenade launchers(AG-7, AG-9)(IRIS, 2024). The sector also possesses significant experience in the maintenance, repairs, and overhauls of Soviet-era armoured vehicles such as the T-55(modernised as TR85-M1) and wheeled APCs(TAB series)(International In stitute for Strategic Studies, 2024). → Gaps: The most critical gap is the absence of domestic design and production of modern heavy armoured platforms to NATO standards(tanks, VCI). This is partially addressed through licensed production and integration, as seen in the GDELS Piranha V program, where UM Bu charest is in charge of the assembly, and Elmet International integrates the turret and weapons systems(RO MARM, 2022). Aerospace: → Capabilities: The main strength is MRO for military and civilian aircraft. Aerostar provides complex, industri al-level maintenance for F-16 fighter jets as well as com mercial airliners(IRIS, 2024; Aerostar S.A., 2024). IAR Brașov specialises in helicopters(IAR-330 Puma) and the IAR-99 training aircraft(IRIS, 2024). → Gaps: There is no significant capacity for in-house design and mass production of advanced combat or transport aircraft. The sector remains dependent on foreign partners for major platform upgrades and advanced technology. Naval: → Capabilities: There are strong capabilities in the construction of complex and diverse naval platforms, in cluding offshore patrol vessels(OPVs), corvettes, frig ates, and specialised support vessels(IRIS, 2024). The Damen shipyard in Galati is a highly efficient production facility, integrated into a global corporate structure (Damen, n.d.-b). → Gaps: While the construction of the hull is a strength, the integration of advanced naval combat systems(ra dars, sensors, missile systems) is a significant weakness. These high-value components are usually purchased from specialised Western suppliers. The failure to conclude the contract for multi-role corvettes underscores the challenges of domestic naval procurement and integration(Overt Defense, 2023; The Defense Post, 2023). Ammunition& Propellers: → Capabilities: ROMARM’s subsidiaries have a long-stand ing capacity to produce a wide range of unguided muni tions, including artillery shells(e.g., 122mm, 152mm), mortar shells, and missile shells(122mm GRAD) to War saw Pact standards(IRIS, 2024). → Gaps: The most critical strategic gap – recognised in the National Defence Industry Strategy 2024 – is the total lack of domestic production capacity for high-power propellants and explosives(TNT, RDX) after the closure of the Făgăraș plant(Romanian Government, 2024). This leaves Romania entirely dependent on imports (e.g., from Serbia) for its ammunition production, a se vere vulnerability. Reviving this capacity has been declared a top priority in the strategy(IRIS, 2024). The analysis of these sectors reveals that Romania’s most immediate and scalable contribution to European defence is not in designing new high-tech platforms, but in capital ising on its profitable industrial base for the high-volume production of essential materials and in strengthening its role as an MRO hub. The gap in R&D and platform design is significant. At the same time, existing strengths in am munition production and maintenance align perfectly with Europe’s urgent needs, highlighted by the conflict in Ukraine, which has exposed massive shortages in ammuni tion stockpiles and a high demand for the maintenance of widely used Western platforms(Center for Strategic and In ternational Studies, 2025; European Commission, 2024). Therefore, a strategy focused on transforming Romania into a European arsenal for artillery shells and the main MRO centre for NATO’s southeastern quadrant is a more achievable and strategically relevant path for the revitalisation of the DTIB. 3. Systemic Constraints: The Challenge of Absorptive Capacity Despite strong political will and increased financial resourc es, Romania’s defence modernisation and industrial revitalisation face a formidable set of deep-rooted, country-specific challenges. These constraints – industrial structure, human capital, and bureaucratic processes – collectively create a significant“absorption capacity gap”, which represents the primary risk in achieving the country’s strategic objectives. These are not separate problems, but interconnected components of a single systemic challenge. This interconnectedness creates a vicious circle: an inefficient industrial culture discourages investment, leading to the bypassing of local industry through G2G procurement, which in turn perpetuates industrial weakness. At the same time, the lack of skilled labour makes investments risky, hindering the creation of jobs that could attract and retain talent. The Romanian Defence Sector 5

The State-Owned Enterprise Dilemma: Overcoming Inertia and Underinvestment The core of Romania’s industrial challenge lies in its stateowned enterprises(SOEs), in particular the 15 subsidiaries under the holding company C.N. ROMARM S.A. These en tities are burdened by a multi-generational legacy of underinvestment, resulting in the widespread use of outdated Cold War-era machine tools and production processes (Kearney, 2025). This technological gap is compounded by a persistent“Sovietized” managerial culture that is resist ant to change, inefficient, and unsuitable for a competitive, market-oriented environment(Sucală, 2018; Epicenter Net work, 2024). The holding structure, established in 2000, has largely failed to impose a significant restructuring or stimulate performance improvement in its subsidiaries, which continue to operate with a high degree of autonomy and inefficiency(IRIS, 2024). This structural weakness makes the state sector an unattractive partner for foreign investors and a significant bottleneck in the defence production ecosystem. The Human Capital Crisis: An Existential Threat to Industrial Ambitions A severe and rapidly deteriorating shortage of human capital presents an imminent threat to both the armed forces and the defence industry, demanding urgent attention. The military has openly acknowledged significant hurdles in re cruitment and retention, as well as the absence of a suffi ciently trained reserve force(IRIS, 2024). This issue is mir rored and amplified in the industrial base. The workforce in the state defence industry is ageing swiftly, with an aver age reported age of approximately 50 years(Epicentre Net work, 2024). This signals an impending“demographic gap,” where a generation of experienced workers will retire with out a sufficiently skilled cohort to replace them. Broader national trends exacerbate this industry-specific problem: → Skills shortages: Romania suffers from acute skills shortages at the national level, especially in technical and vocational fields. The education system – especially Technical and Vocational Education(VTI) – is under funded and poorly aligned with the needs of modern in dustry, resulting in graduates lacking practical, applicable skills(IRIS, 2024). → Brain drain: The emigration of highly skilled workers and engineers to Western Europe has drained the country of critical talent, making it challenging to recruit and retain skilled personnel in high-tech sectors such as defence(World Bank, 2025). This human capital crisis is not just an industrial problem, but a national security vulnerability: without qualified tech nicians, Romania cannot independently support the advanced Western equipment it acquires. The global outlook of the defence industry emphasises talent management as a critical success factor, an area where Romania faces sys temic challenges(Deloitte, 2023; PwC, 2024). Bureaucratic Bottlenecks: Reforming Procurement and Improving Budget Execution Romania’s defence procurement process is a significant constraint. The government’s tendency to rely on government-to-government(G2G) contracts – specifically the US Foreign Military Sales(FMS) mechanism – is a double-edged sword(IRIS, 2024). G2G agreements provide a fast, transparent, and low-corruption path to acquire topnotch military equipment, but often bypass domestic industry, providing minimal opportunities for local production, technology transfer, or long-term support work(IRIS, 2024). This is exemplified by the acquisition of F-16 aircraft from Portugal, which did not include an offset or industrial coop eration agreement(Romanian Energy Center, 2016), in con trast to the Piranha V program, which involved substantial local production(ROMARM, 2022). The legal framework for industrial cooperation(off set) was recently reformed by Emergency Ordinance 124/2023, which replaced the automatic offset system with a more targeted, case-by-case approach justified by“essen tial security interests”(IRIS, 2024). Although this amend ment aligns Romanian legislation with EU directives, its ef fectiveness now depends entirely on the ability of the new implementing agency – the Romanian Agency for Technological and Industrial Cooperation for Security and Defence (ARCTIS) – to negotiate and enforce robust industrial coop eration plans in major contracts. The history of bureaucratic delays and cancelled tenders(e.g., the multifunctional corvettes program, where misunderstandings between Naval Group and the Constan ta Shipyard led to the failure to sign the contract(Overt Defence, 2023; The Defence Post, 2023)) suggests that de fence procurement remains a high-risk, low-efficiency pro cess that can deter potential industrial partners(IRIS, 2024). 4. The Way Forward: Integrated European Cooperation The most effective path forward for Romania is to integrate its defence industry into European supply chains and leverage external partnerships to address internal challenges. By establishing itself as a reliable and cost-effective partner for production, assembly, and support, Romania can attract the technology, capital, and managerial expertise needed to revitalise its defence and technology industrial base (DTIB), enhance its military capabilities, and make a signifi cant contribution to European collective security. To implement this strategy, a clear roadmap should be developed that would focus on concrete high-potential opportunities prioritised based on their strategic impact and feasibility. A key priority is addressing the critical shortage of ammunition in Europe. This presents a short-term, high-impact opportunity to establish joint production of 155mm ar tillery projectiles, leveraging existing industrial infrastruc The Romanian Defence Sector 6

ture. This initiative aligns with top national priorities and available EU funding mechanisms. Additionally, there is a medium-term strategic need to tackle Romania’s most significant industrial vulnerability: the lack of domestic production of propellants and ex plosives. To ensure a fully sovereign ammunition supply chain, it is essential to establish a new, large-scale plant for propellants through strategic partnerships, an effort that enjoys strong political support. In the land systems sector, the focus should be on creating high-value regional maintenance, repair, and overhaul (MRO) hubs. With the national acquisition of new main battle tanks and the increasing number of these platforms in the region, establishing a regional MRO and modernisa tion centre for heavy armour has become a strategic necessity in the medium term. Additionally, there is a similar opportunity for long-range artillery. Establishing a regional support hub for rocket artillery systems would not only sup port national battalions but also serve nearby allies, creating a crucial high-tech support facility. In addition to maintenance, there are medium-term opportunities to re-enter ground system production. These include the licensed production of key components for modern European infantry fighting vehicles, which would enhance surge capacity for European partners while facili tating significant technology and skills transfer. Furthermore, by leveraging existing national experience with lega cy anti-aircraft systems, Romania can address a critical NATO capability gap by modernising its short-range air de fence(SHORAD) production. This could potentially involve licensed manufacturing of new systems or their compo nents. The aerospace and naval sectors present distinct opportunities for large-scale development. In aerospace, a world-class national facility lays the groundwork for a short-term expansion into a regional Maintenance, Repair, and Overhaul(MRO) hub for F-16 fleets. This development not only enhances national capabilities but also transforms them into a strategic asset for the Alliance, supporting the increasing number of operators in Central and Eastern Europe and bolstering NATO’s forward defence posture. In the naval sector, Romania’s involvement in the European Patrol Corvette PESCO project, coupled with the urgent need to replace its outdated fleet, creates a significant long-term opportunity. National shipyards have the modern infrastructure necessary to effectively contribute to this major European program, especially in hull construc tion. This potential is further enhanced by the European initiative to establish a regional maritime security centre on the Black Sea, which Romania has proposed to host. This centre can serve as an additional catalyst for the development of the national naval sector. Future growth should prioritise cooperation by focus ing on building capabilities in high-potential, disruptive sectors. The national acquisition of modern Unmanned Aerial Vehicle(UAV) systems will lay a foundation for me dium-term integration into European drone programs. These programs are expected to include component manu facturing, assembly, and maintenance, repair, and operations(MRO), offering significant opportunities for collabo ration with key partners. At the same time, a long-term initiative should aim to establish a C4ISR(Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance) and Cyber Security Centre of Excellence. This initiative would leverage Romania’s robust civilian IT sector to ad dress a critical national defence priority, focusing on software development and system integration for defence ap plications. 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Romania’s defense industry at a turning point. https://www.kearney.com/industry/aerospace-defense/article/romanias-defense-industry-at-a-turning-point KPMG.(2025). The Romanian defense market: Opportunities and challenges . https://assets.kpmg.com/content/dam/kpmg/ro/pdf/2025/ romanian-defense-market.pdf Ministry of National Defence.(2020). Defence White Paper 2020[in Romanian]. The Government of Romania. https://www.mapn.ro/legis latie/documente/CARTA-ALBA-A-APARARII.pdf NATO(2025). The Hague Summit Declaration issued by the NATO Heads of State and Government participating in the meeting of the North Atlantic Council in The Hague 25 June 2025. Available at: https://www.nato.int/cps/en/natohq/official_texts_236705.htm Oprișor, M.(27 February 2024). The Romanian Defence Industry – Between Present and Future. Euro-Atlantic Romania. https://e-arc. ro/2024/02/27/the-romanian-defence-industry-between-pres ent-and-future-2/ Overt Defence.(14 August 2023). Romania Terminates Gowind 2500 Corvette Procurement. https://www.overtdefense.com/2023/08/14/ romania-terminates-gowind-2500-corvette-procurement/ The European Parliament and the Council of the European Union. (2023). Regulation(EU) 2023/1525 of the European Parliament and of the Council of 20 July 2023 on supporting ammunition production (ASAP). Official Journal of the European Union. https://eur-lex.europa. eu/legal-content/EN/TXT/?uri=CELEX:32023R1525 Petrescu, A.(2018). Military Production in Romania During the Com munist Era Had a Significant Effect on the Organisational Culture. Bulletin of“Carol I” National Defence University. https://revista.unap. ro/index.php/bulletin/article/download/14-18/434/2155 PwC.(2024). Global aerospace and defence: Annual industry performance and outlook. https://www.pwc.com/us/en/industries/industri al-products/library/aerospace-defense-review-and-forecast.html ROMARM.(15 March 2022). Uzina Mecanica Bucuresti- General Dynamics strategic partnership, the first step to revive the defense industry by manufacturing Piranha 5 armored vehicles. https://romarm.ro/ en/parteneriat-strategic-uzina-mecanica-bucuresti-general-dynam ics-prin-fabricarea-piranha-5/ Romanian Energy Center.(2016). F-16s for Romanian Air Force. Black The Romanian Defence Sector 8

Sea Defense& Aerospace. https://bsad.roec.biz/portfolio-item/f16sfor-romanian-air-force/ Stockholm International Peace Research Institute.(December 2018). Romania and Black Sea Security. https://www.sipri.org/sites/default/ files/2019-04/bp_1812_black_sea_romania.pdf Sucală, L.(2018). Inside the Romanian communist economy: State planning, factory and manager. https://theses.gla.ac.uk/30636/ The Defense Post.(2023, 9 August). Romania Cancels Warship Tender Awarded to France’s Naval Group. https://thedefensepost. com/2023/08/09/romania-cancels-warship-france/ TVR Info.(2025a, May 29). Craiova planes, delays to delays. The factory asked the Army for a new postponement for the delivery of the first modernized IAR 99 aircraft[in Romanian]. https:// tvrinfo.ro/avioane-craiova-intarzieri-la-intarzieri-fabrica-a-cerut-ar matei-o-noua-amanare-pentru-livrarea-primului-avion-iar-99-modern izat/ Vasilachi, D. C.,& Vasilachi, C.(2021). Production and Export of Mil itary Products in the Context of Romania’s Foreign Policy between 1968 and 1989. Air Force Academy Review,(2). https://www.afahc. ro/ro/revista/2021_2/6-Dragos-Catalin%20Vasilachi,Constantin%20 Vasilachi.pdf About the Author Claudiu Degeratu is a foreign policy analyst with a focus on European affairs. Until 2024 he was advisor in the Senate, the Romanian Parlia ment. He has worked in various senior positions within the Romanian Ministry of Defense. During 1997–2010, he held various senior posi tions, including the General Director for Defense and Planning Policy, responsible for NATO and EU policies. He also served as Chief of the Defense Section of the Romanian Permanent Delegation at NATO Headquarters in Brussels. His work focuses on issues related to inter national relations, national and international security, NATO and the EU, and studies on totalitarian regimes. Other titels in the series Defence Industry in Central Eastern Europe The Defence Sector in the Czech Republic: Past, Present and Future (January 2026) The Defence Sector in Central and Eastern Europe – The Hungarian Case(January 2026) The Defence Sector in Poland(January 2026) The Defence Sector in Slovakia(January 2026) Analysis of the Slovenian Defence Sector(January 2026) Imprint Published by Friedrich-Ebert-Stiftung e.V. Godesberger Allee 149 53175 Bonn info@fes.de Publishing Department Department for International Cooperation/ European Union and North America Department Content Responsibility and Editing Dr. Ernst Hillebrand, Director FES Budapest Contact budapest@fes.de Image Credits P. 1: Moleng24/Tymofii The views expressed in this publication are not necessarily those of the Friedrich-Ebert-Stiftung e.V.(FES). Commercial use of media published by FES is not permitted without the written con sent of the FES. Publications by the Friedrich-Ebert-Stiftung may not be used for election campaign purposes. January 2026 © Friedrich-Ebert-Stiftung e. V. ISBN 978-3-98628-811-2 Further publications of the Friedrich-Ebert-Stiftung can be found here: ↗ www.fes.de/publikationen Department for International Cooperation The Romanian Defence Sector 9