This work derives from a final report produced for the Middle East Institute’s Black Sea Program as part of a U.S. State Department Title VIII fellowship.

The war in Ukraine has turned policymakers’ eyes back toward the Euro-Atlantic arena and highlighted the need to reinvigorate the North Atlantic Treaty Organization’s (NATO) defense-industrial base. Historically, the Alliance’s newer members along the eastern flank have played a limited role in actually producing the hardware that underpins its military capabilities. But with demand growing in response to Russia’s invasion, Western production capacity under strain, rising concern about supply chain security, and growing interest in “friendshoring,” there is value in finding ways to improve defense-industrial integration with willing partners. Here, Romania’s status as a NATO ally and European Union member, with a well-educated workforce, a competitive tech cluster in Cluj-Napoca, and relatively low labor costs, means that it may be an attractive partner in these efforts. Drawing on conversations with dozens of policymakers, defense officials, and experts in Bucharest during the summer of 2023, I describe here the macro policy environment that shapes the current relationship between Romania and the United States, and I consider what steps the U.S. could take to improve Romania’s integration with the Euro-Atlantic defense-industrial base.

How Bucharest sees the US

The Romanian defense establishment views the bilateral relationship with the United States as the key guarantor of Romanian security. Among the sources I spoke to, this was often expressed as part of a historical perspective that regarded Romania’s 20th century history as one of conquest and, at best, unstable geopolitical relations, which saw only the country’s post-Ceaușescu Euro-Atlantic turn in general, and its partnership with the U.S. in particular, as successfully delivering any kind of long-term stability and protection. In technical terms, this is a function of NATO’s Article V collective defense clause, but it seemed clear that the only question that really matters, from a Romanian perspective, is whether the U.S. will show up in a crisis.

That perspective is foundational to Romania’s choices about deploying alongside the U.S. abroad and hosting U.S. bases at home, to the enthusiasm that was expressed about the U.S. increasing its forward-deployed presence in the country, and to its preference for U.S.-made defense systems. These are understood as self-reinforcing mechanisms — deploying with the U.S. when it needs allies and hosting U.S. bases helps ensure the U.S. will fight alongside Romania in a crisis, and if that does happen, maximal interoperability (which can be achieved by buying U.S. equipment) with U.S troops will be valuable. That same interoperability is also beneficial for joint deployments, but even in their absence, buying equipment from the U.S. helps strengthen defense ties and therefore increases the likelihood that the U.S. will fight to defend Romania.

Looking beyond the acquisition space, sources in Bucharest routinely described Romania as the most reliable NATO ally in the Black Sea and were keen to emphasize Romania as a country the U.S. could count on. There also seemed to be widespread respect for U.S. defense practices, a real sense that Romania could “learn from the best” by emulating American processes and institutions, and strong enthusiasm for doing so. Indeed, a U.S. Office of Defense Cooperation that was more aggressive in pushing American processes and norms, and less deferent to Romanian ones, might find a receptive audience.

Most experts forcefully conveyed that Romania wants (and has wanted for almost a decade) a more coherent and robust U.S. strategy for the Black Sea (or any strategy at all), but in practical terms the Romanian position amounts to something like “Please tell us what you want us to do!” Conventional wisdom holds that the Baltics and Poland have, to date, secured a stronger NATO presence than the Black Sea states because they first cooperated more effectively on a regional basis. For Romania, that may be a difficult condition to meet. NATO-level initiatives for the region are limited by whatever Turkey and Bulgaria will accept and pursuing something bilaterally with the U.S. is (from Romania’s perspective) a nonstarter if it would be judged to meaningfully upset relations with Turkey. This likely explains the disconnect between the enthusiasm expressed in Bucharest for a U.S. and NATO Black Sea strategy, and possible perceptions of passivity in Washington regarding Romania’s willingness to act. The same logic — that Romanian freedom of action is downstream of the condition of other U.S. relationships — may apply in Europe, too. Romania prizes its relationship with the U.S., but it is also clear that, as a committed EU member with a strong relationship with France and major exports to Germany, it does not want to upset European allies. To the extent that the U.S. can reach a modus vivendi with the EU on questions of defense-industrial base management and defense market access, it will help countries like Romania steer a more stable policy course — ultimately, Bucharest wants clear guidance that does not force it to choose between pleasing one ally and disappointing another.

Options to bolster defense-industrial cooperation

Against this backdrop, policymakers could consider a range of policy options to enhance Romania’s integration with the U.S. defense-industrial base. The two I describe here are designed to identify and facilitate company-level linkages, and to eliminate regulatory barriers to realizing them. First, the U.S. could consider establishing a U.S.-Romania Defense-Industrial Planning Group that works with leading U.S. defense contractors to identify vulnerabilities with existing supply chain partners and to find Romanian partners that may be viable replacements. This process would likely involve input from the Department of State, the Department of Defense, and the Bureau of Industry and Security (Department of Commerce). After working with U.S. defense firms to identify specific products in their supply chains worth targeting for friendshoring, the Planning Group could pivot to facilitate trade missions, with the aim of helping U.S. contractors identify viable supply chain partners in Romania. In the event of a successful match, the Group could continue to offer technical support to ensure bureaucratic and regulatory issues are promptly dealt with. In parallel, the Group could also pursue a fact-finding exercise to determine the most important factors currently hindering U.S. investment in Romanian defense firms and to develop potential solutions in partnership with Romanian policymakers. Pursuing defense-industrial ties like this — independent of offsets linked to specific transactions — may help ease the pressures of alliance politics by making it less salient, more responsive to actual commercial interests, and divorced from zero-sum choices about whether to procure from European allies or the United States.

The U.S. could also evaluate the feasibility of concluding a “reciprocal defense procurement memorandum of understanding [MoU]” with Romania such that it is considered a qualifying country and therefore exempted from the Buy American statute (which requires goods procured by the federal government to have a certain percentage of domestic content). Currently, Romania is not considered a qualifying country, so if a U.S. contractor were to incorporate Romanian products into its supply chain, doing so might complicate its efforts to remain compliant with Buy American content requirements. Sources I spoke with in Bucharest did not identify the absence of this kind of MoU as a current barrier to integrating Romanian firms with U.S. supply chains, but it is still worth pursuing now — first, to prepare the ground for future integration, and second, to send an important signal of intent to Romanian and U.S. industry.

With Russia prosecuting kinetic conflict in Europe and China widely recognized as the “pacing challenge” in the Indo-Pacific, defense-industrial policy in Southeastern Europe might seem like a sideshow. But in fact, the scale of the resources that will be necessary to ensure a Ukrainian victory while successfully deterring a revisionist China places a premium on making sure every member of the Euro-Atlantic community (and especially every NATO member) can pull its weight. This means burden-sharing not just in terms of the number of troops a country can credibly make available to NATO planners but also in terms of defense-industrial production. And insofar as Romanian producers likely have a lower cost base than American ones, integrating them into supply chains for products the Department of Defense will acquire could also benefit U.S. taxpayers. Ultimately, improving Romania’s defense-industrial integration with U.S. supply chains can better position Europe to produce the military capabilities it requires for successful deterrence, and it can help strengthen the position of an eager, motivated, and increasingly capable Euro-Atlantic ally.


Eoin Power is a Title VIII Black Sea Research Fellow at the Middle East Institute and a Ph.D. student in the Department of Government at the University of Texas at Austin. His dissertation focuses on the political economy of defense-industrial policy and maritime security institutions in Europe.

Courtesy Wikimedia Commons

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