BMI's Executive Summary

[TOP]

Romania was made a member of the EU on January 1 2007, and has undergone significant institutional and social changes to meet EU accession requirements. Romania's accession is likely to lead to an increased participation in multilateral defence commitments, especially as it is one of the more geostrategically important NATO and EU members due to its location on the Black Sea region. Romania's location allows for easier projection of NATO defence interests near regional security 'hot spots', such as Iraq and Afghanistan. At present, Romania has some 2,000 troops stationed overseas in the Balkans, Afghanistan and Iraq.

The Romanian government faces considerable challenges in modernising its armed forces. As a member of NATO, Romania is expected to meet minimum NATO interoperability standards, which ensure that exercises and joint operation can take place. However, Romania's capabilities are ageing rapidly, which places increased pressure on the Romanian defence budget. The Romanian government examined a range of funding options to support its six large-scale procurement programmes worth an estimated US$19bn. However, Romania's defence expenditure is already reaching its limit, as the government is committed to allocating 2% of GDP towards the defence budget.

Romania's defence industry is set to mature considerably. In Q407, the Romanian Authority for State Asset Recovery re-launched the privatisation programme for Avioane Craiova. The previous privatisation bids for Avioane Craiova were rejected by the state authority based on the grounds that the bidding firms were not suitable to run Romania's top aerospace company. Also in Q407, Eurofighter announced that it was considering producing 48 Typhoon multi-role combat aircraft in Romania in order to secure a US$5bn contract. The amount of activity in Q407 is certainly a boost from previous months. The question is whether the local defence industry can step up to the mark and maintain the growing international interest in Romania's defence industry.

Contents

[TOP]

Chapter 1 - Executive Summary

SWOT Analysis

Romania Security SWOT

Romania Defence Industry SWOT

Romania Political SWOT

Romania Economic SWOT

Romania Business Environment SWOT

Chapter 2 - Political Overview

Political Outlook

Chapter 3 - Security Risk Analysis

BMI’s Security Ratings

Table: Romania Regional Security Ratings

Table: Romania State Terrorism Vulnerability Index

Regional Security: Europe

Overview

Internal Terrorism

International Terrorism

Criminal Activities

Romania Terrorism Risk Ratings

Romania Physical Safety Risk Ratings

Romania Conflict Risk Ratings

Chapter 4 - Security Outlook

Internal Security Situation

Table: Regional Insurgent Groups

External Security Situation

Chapter 5 - Defence Industry

Armed Forces

International Deployment

Chapter 6 - Market Overview

Industry Trends & Developments

Table: Romanian Aerospace Key Players

Arms Trade Overview

Procurement Trends & Developments

Chapter 7 - Industry Forecast Scenario

Army Enlargements

Table: Romanian Defence Sector Historical Data & Forecasts

Key Risks to BMI’s Forecast Scenario

Chapter 8 - Macroeconomic Forecast Scenario

Growth To Exceed 6% This Year

Risks To Outlook

TABLE: GDP Output & Population

Chapter 9 - Company Profiles

IAR SA Brasov

Aerostar

MFA Mizil

Romaero

Multinational Manufacturers

EADS/Eurocopter Romania

Chapter 10 - BMI Forecast Modelling

How we generate our industry forecasts

Defence Industry

Sources

Chapter 11 - Appendix A: Risk Ratings Methodology

Conflict Risk Methodology

Terrorism Risk Methodology

Physical Safety Risk Methodology

Overall Risk Rating

State Vulnerability Index

Competitive Landscape for European Defence & Security: Sample of  
Companies Ranked

[TOP]

Rankings and Competitive Landscapes by production and sales; market share and change on previous year; number of employees, ownership structure and year established. Also includes analysis of company expansion, export and investment strategies.

Network of Defence & Security Sources

[TOP]

BMI's European Defence & Security Reports are based on an extensive network of multilateral organisations, government departments, automotive industry associations, chambers of commerce and company reports. Information sources include: