NATO member Romania secures $920M US loan for military modernization
Banners displaying the NATO logo are placed at the entrance of new NATO headquarters during the move to the new building, in Brussels, Belgium April 19, 2018. (Reuters Photo)
NATO member Romania, which borders Ukraine, signed an agreement with the United States on Wednesday for a $920 million loan to modernize its military capabilities.
The eastern European Black Sea nation, which has gained strategic importance since Russia invaded Ukraine in 2022, has been looking to increase its defense purchasing.
The procurements to be financed with the loan are meant “both to fulfill the commitments undertaken as a result of being a NATO and EU member state and to deter a possible aggression against Romania,” the government said.
At the signing ceremony in Bucharest on Wednesday, U.S. Ambassador Kathleen Kavalec said the loan marked “our shared commitment to ensure peace, stability and security in the region.”
The loan – with lower interest rates than those at which the Romanian state usually borrows – will have a repayment period of 12 years.
From the loan, $220 million will create “a center of excellence in the production of 120-155 mm large caliber ammunition,” said Economy Minister Radu Oprea.
“This center means that Romania will become the only producer of ammunition for the Abrams tank in Europe and from here we will export to all of Europe and beyond,” he added.
Romania’s importance for Ukraine’s security
The country hosts more than 5,000 foreign troops, the largest contingent anywhere in NATO’s southeastern region.
It is also home to a new F-16 pilot training center, where Ukrainians recently started to train.
The U.S. State Department said earlier this month that it had approved the sale of dozens of F-35 fighter jets to Romania.
The deal, worth $7.2 billion, is still awaiting U.S. Congress approval.
Romania announced in June that it would send a Patriot missile system to Ukraine, on the condition of continuing negotiations with the United States and other allies to obtain a similar or equivalent system to protect its own airspace.
The country of 19 million people has repeatedly found drone debris from fighting in Ukraine in its border region.
