Romania will attract certain investments worth more than 25 billion euro over the next five years in vital sectors such as defence, energy, infrastructure and the extraction of critical mineral resources, which will provide an extremely attractive framework for the horizontal development of business in the economy, according to a Frames analysis released on Monday.
"The macroeconomic outlook is positive for Romania. This is what most investors take into account. Political squabbling is seen only as background noise, while 'we are not selling our country' type of discourses fall into irrelevance. Whoever is at the Victoria Palace in the coming years will have to ensure one essential element - fiscal predictability, which will allow the business environment to outline feasible investment plans for the 2030-2035 horizon," Frames Manager Adrian Negrescu said, as quoted in a press release.
According to the analysis, close monitoring of the country's finances by ECOFIN is one of the main guarantees ensuring business predictability, while accession to the Organisation for Economic Co-operation and Development (OECD) this year will also bring an additional seal of credibility for Romania.
"The next step, from the perspective of national plans, will certainly be the entry into the euro area," the authors said.
All these positive prospects are underpinned by major investment projects from which Romania will benefit in the next years. Beyond the investments already known, worth 10 billion euro through the National Recovery and Resilience Plan (PNRR), the Security Action for Europe (SAFE) programme, although criticised by politicians, is set to become one of the largest major investment projects in Romania. In essence, it is the largest military procurement programme in the country's history, worth almost 17 billion euro. Alongside the obvious aim of equipping the Army, more than 4 billion euro are allocated to the vital completion of the Moldavia Motorway.
Beyond the effects of motorway construction and the excellent financing conditions (3% interest rate, 10-year grace period and repayments spread over 25 years), the SAFE programme has an important feature for the Romanian economy: at least 50% of these funds will be mandatorily directed towards the domestic defence industry, with the Cugir Arms Factory, the Sadu Military Plant, the 2 Mai Mangalia Shipyard and the future powder plant in Brasov among the main targets, with effects expected to be felt widely across the real economy.
Other major announced investments are set to turn Romania into a key player in the energy industry. The best known and most relevant is the OMV Petrom-Romgaz partnership for the exploitation of the Black Sea gas, a project that will place Romania among Europe's top gas exporters, with multiple benefits for the Romanian economy. In this context, the recent announcement by the World Bank is also important, as it has earmarked 500 million dollars for the modernisation of the Transgaz network, the analysis mentioned.
The European Bank for Reconstruction and Development will also invest 400 million euro in the same strategic project, while advanced discussions are also under way on investments in reactors 3 and 4, which would position Romania as a major electricity producer.
Beyond investments in the energy and gas sector, Romania has every chance of becoming, by 2030, a true European hub for critical minerals, given that the European Commission has designated three Romanian initiatives as European strategic projects. These target graphite extraction through the state-owned company Salrom (vital for the electric car battery industry), magnesium through the private company Verde Magnesium in Bihor, and copper through Samax Romania in Hunedoara county.
In addition, Romania could become a major player in industrial logistics in Europe, amid the fundamental changes affecting the global economy, from the shortening of production and supply chains to a focus on finding safe locations, shielded from adverse events such as war and climate change.
Maersk, the world's largest container shipping operator, recently announced that Romania is beginning to grow as a nearshoring destination, meaning the relocation of production, in the context of rising transport costs caused by the disruption of key routes. From Constanta and along the Danube, goods could reach Western Europe up to four days faster than via northern sea routes.
Another important element in this regard is the strong interest announced by Rheinmetall AG and the Swiss company MSC in taking over the Mangalia shipyard, which is currently in insolvency. The two investors have said there is the possibility of making substantial investments in the site and transforming the shipyard into a dual-use centre for both military and civilian shipbuilding.
