Romania: An Overview

Romania: An Overview

Updated June 14, 2022
Romania: An Overview
With a population of almost 20 million, Romania is the
Governance and Rule-of-Law Concerns
largest country in southeastern Europe. After the end of
Corruption and weak rule of law are regarded as significant
communist rule in 1989, Romania adopted a Euro-Atlantic
challenges in Romania. Due to concern that these issues had
orientation, joining NATO in 2004 and the European Union
not been resolved when Romania joined the EU in 2007,
(EU) in 2007. Romania’s strategic Black Sea location,
Brussels continues to monitor Romania’s reform progress.
steadfast commitment to its security partnership with the
United States, and shared concerns about Russia make it a
During the 2000s and 2010s, EU assessments praised key
key U.S. ally in the region. Romanian officials have
elements of Romania’s anti-corruption and judicial reforms.
unequivocally condemned Russia’s 2022 war on Ukraine
The National Anticorruption Directorate, for example,
and have supported EU sanctions against Russia and
successfully prosecuted numerous officials and politicians
NATO’s enhanced deterrence and defense posture in the
on corruption charges. From 2017 to 2019, however, PSD-
eastern part of the alliance.
led governments sought controversial changes to Romania’s
judicial and anti-corruption institutions, citing their
Domestic Background
politicization and capture. Critics viewed the measures as
Romania is a parliamentary republic with a semi-
an effort to undermine judicial independence and protect
presidential system. A directly elected president serves as
officials accused of corruption, including PSD’s powerful
head of state, and a prime minister leads the government.
then-leader, Liviu Dragnea.
President Klaus Iohannis, a centrist backed by the National
Liberal Party (PNL), was elected to a second five-year term
The situation changed following public backlash and sharp
in 2019. PNL has led successive, short-lived governments
EU and U.S. criticism. Dragnea began a prison sentence for
since late 2019. Prime Minister Nicolae Ciucă leads a grand
abuse of position in May 2019, and the PSD-led
coalition government including PNL, the Social Democratic
government collapsed in October 2019. Some of the
Party (PSD), and the Democratic Alliance of Hungarians in
controversial justice measures have since been reversed.
Romania (UDMR). The Ciucă government formed in
Still, corruption remains a major challenge. The State
November 2021, succeeding another PNL-led government
Department’s 2021 human rights practices report for
that took office in December 2020 and collapsed in October
Romania assessed that corruption, misuse of public funds,
2021.
and bribery remain widespread.
Romanian voters largely delivered victories to center-right,
Figure 1. Romania at a Glance
liberal, and progressive candidates in European Parliament
and presidential elections in 2019 and in local elections in
2020. In the December 2020 parliamentary elections,
however, PSD won a plurality of votes (just under 30%).
PNL placed second (25%), followed by the liberal USR-
PLUS alliance (15%), the newly formed far-right Alliance
for Romanian Unity (9%), and UDMR (6%). Key voter
concerns included the economy and perceived
mismanagement of the COVID-19 pandemic. Despite
placing first, PSD remained in opposition until joining the
government in November 2021.

The Ciucă government faces serious policy challenges: the
Sources: International Monetary Fund and 2011 Romanian census.
continuing pandemic, record-high energy costs and
inflation, an influx of hundreds of thousands of refugees
Economy and Energy
from Ukraine, and the security crisis triggered by Russia’s
For part of the 2000s and 2010s, Romania was among the
war on Ukraine. The governing parties’ historic rivalry and
EU’s fastest-growing economies. Despite improved
potentially diverging priorities could strain the coalition.
conditions and greater gross domestic product (GDP) per
PSD holds key ministries and leads opinion polls, while
capita convergence toward the EU average, nearly a third of
support for PNL has declined. Under the coalition
Romania’s population is at risk of poverty or social
agreement, Ciucă is to serve as prime minister until May
exclusion. Other barriers to economic growth include an
2023, followed by a PSD appointee.
aging and shrinking population, infrastructure deficiencies,
an unpredictable legal environment, and corruption. The
pandemic contributed to a 4% contraction in GDP in 2020.
Romania’s GDP grew by 5.8% in 2021, and its economy is
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Romania: An Overview
forecast to grow by 4% in 2022 and 2023. Romania is to
Romania is investing in facilities used by NATO and U.S.
receive €29.2 billion in grants and loans under the EU’s
forces, including about $2.5 billion in planned upgrades to
COVID-19 recovery and resilience package. Record-high
Mihail Kogălniceanu air base, a key regional transit hub.
energy costs and inflation may threaten growth, however.
Relations with the United States
As an oil and natural gas producer, Romania is somewhat
Security Cooperation. The United States and Romania
self-sufficient in its energy supplies. Offshore Black Sea
closely cooperate on security. Romania’s strategic
gas deposits estimated at 200 billion cubic meters could
partnership with the United States is a pillar of its defense
bolster energy security in Central and Eastern Europe,
strategy, and U.S. officials have described Romania as a
although their development was delayed for years due in
steadfast ally. U.S. and Romanian soldiers have deployed
part to regulations and offshore taxation that investors
together in Afghanistan, Iraq, Kosovo, and elsewhere.
viewed as a deterrent. In May 2022, Romania adopted some
policy changes in hopes of accelerating production. Initial
Romanian officials have long sought a stronger U.S.
offshore gas extraction is scheduled to begin in mid-2022.
security presence in the country. A 2005 Defense
Cooperation Agreement enabled U.S. use of several bases
Foreign and Security Policy
in Romania. Romania hosts one of the two Aegis Ashore
Romania’s national defense strategy prioritizes the
ballistic missile defense systems that the United States
country’s EU and NATO membership and its security
contributes to NATO missile defense in Europe. The
partnership with the United States. This Euro-Atlantic
bilateral Roadmap for Defense Cooperation for 2020-2030
orientation is grounded in strong cross-party and popular
reinforces and expands security ties. Since 2014, the United
support. One of Romania’s primary foreign policy goals is
States has typically maintained rotations of around 500-
to elevate Black Sea security as a transatlantic priority,
1,000 troops in Romania under Operation Atlantic Resolve.
particularly since Russia’s 2014 invasion of Ukraine.
In early 2022, the United States repositioned a 1,000-
Supporting the sovereignty and territorial integrity of
member Stryker squadron based in Germany to Romania,
neighboring Moldova (with which Romania has historical
bringing the total number of U.S. troops to around 2,000.
and cultural ties) is another foreign policy priority.
Foreign and Security Assistance. During the 1990s, the
The Black Sea, NATO, and Russia
United States provided assistance for Romania’s domestic
Romania has sought to elevate Black Sea security as a
transition and its EU and NATO membership bids. Since
priority within NATO and the EU. Romanian officials have
Romania’s EU accession in 2007, most U.S. assistance has
criticized Russia’s actions in the Black Sea region,
targeted security issues, including military training and
including its support for breakaway territories in Moldova
modernization, Black Sea security, transnational threats,
and Georgia, its aggression against Ukraine, and its military
and improved interoperability with NATO. From FY2018
buildup in the Black Sea.
to FY2021, the United States provided around $140 million
in assistance under the Department of Defense’s “train and
Romania is a proponent of NATO’s defense and deterrence
equip” programs (10 U.S.C. §333) and the State
initiatives along the alliance’s eastern flank and has long
Department’s Foreign Military Financing and International
urged a greater NATO presence in the Black Sea region.
Military Education and Training programs. Congress
NATO has expanded its presence in Romania amid
authorized $130.5 million to upgrade Romania’s Câmpia
Russia’s 2022 war on Ukraine. In March 2022, NATO
Turzii air base in the FY2021 National Defense
announced four new multinational battlegroups to
Authorization Act (P.L. 116-283).
complement existing battlegroups in the Baltic region. The
new Romanian battlegroup, which France leads under the
Energy. Romania is part of the Three Seas Initiative, a
auspices of the NATO Response Force, has around 1,000
U.S.-backed platform among EU member states in Central
troops. Largely at Romania’s behest, the allies agreed in
Europe that includes a focus on energy infrastructure. In
2016 to a tailored Forward Presence in southeastern
2020, the United States and Romania signed an
Europe. Romania hosts the Multinational Divisional
intergovernmental agreement to cooperate on Romania’s
Headquarters Southeast, which commands the Romanian-
nuclear power program. The same year, the two countries
led Multinational Brigade Southeast.
agreed to cooperate on modernizing Romania’s sole nuclear
power plant (Romania canceled prior plans to cooperate
Defense Spending and Military Modernization
with China General Nuclear Power Corporation). The U.S.
In recent years, Romania’s annual defense spending has
Export-Import Bank signed a memorandum of
met or exceeded NATO’s target of 2% of GDP. In March
understanding with Romania to potentially extend up to $7
2022, President Iohannis called for increasing spending to
billion in financing for the power plant and related projects.
2.5% of GDP beginning in 2023, citing the security threat
Romania hopes to double its nuclear power capacity by
triggered by Russia’s war on Ukraine. A significant portion
2030.
of spending has gone toward new equipment and defense
capabilities. Romania’s planned acquisitions are valued at
In November 2021, Romania’s Nuclearelectrica reached an
over $10 billion, including a $4 billion deal to purchase
agreement with U.S. firm NuScale Power to deploy small
new Patriot air defense systems (Romania received its first
modular reactors (SMRs) in Romania. The U.S.
delivery in 2020). Other planned acquisitions include High
government helped facilitate the collaboration on the new
Mobility Artillery Rocket Systems, Naval Strike Missile
technology and is funding a NuScale simulator to help
Coastal Defense Systems, and secondhand F-16 fighter jets.
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Romania: An Overview
further Romania’s ambitions of becoming a regional hub
Sarah E. Garding, Analyst in European Affairs
for SMR training and education.
IF11801

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