Romania and the German arms giant Rheinmetall will build in the town of Victoria, in Brașov County, the most modern gunpowder factory in the world for ammunition production. The agreement for the investment, worth €535 million, was finalized last Wednesday in Germany by Romanian Minister of Economy Radu Miruță. The project, set to begin in 2026 and be completed within three years, will create 700 direct jobs and aims to secure for Romania and the entire region the essential raw material needed for the defense industry.
The Ministry of Economy, Digitalization, Entrepreneurship, and Tourism (MEDAT) announced that the €535 million investment is scheduled to start in 2026 and be carried out within three years. The contract signing ceremony took place in Germany, attended by Rheinmetall CEO Armin Papperger and high-ranking officials, including NATO Secretary General Mark Rutte, German Defense Minister Boris Pistorius, German Vice Chancellor Lars Klingbeil, and Bulgarian President Rumen Radev. Radu Miruță, representing the Romanian government, emphasized the strategic importance of the factory, which is to become “the most advanced in the world.”
Minister Miruță highlighted that the current agreement is the result of “intensive weeks of discussions and negotiations,” which secured significant benefits for Romania. By reopening talks and invoking the principles of symmetrical trade relations, Romania obtained veto power in key decisions, an obligation to involve Romanian suppliers in the project, fair licensing costs, and clearly defined state participation. These negotiations generated savings for the state budget amounting to over €93 million.
Thanks to this investment, Romania will not only secure supplies of raw material essential for its own arms industry but will also gain the role of a significant regional player in this field. Rheinmetall, as the largest European arms manufacturer and one of the beneficiaries of Europe’s defense modernization efforts following Russia’s invasion of Ukraine, is actively expanding its production capacities in multiple countries.
A day before announcing the Romanian project, the company revealed plans to produce gunpowder and 155 mm artillery shells in Bulgaria through two joint ventures with a total value of over €1 billion. Moreover, last year Rheinmetall acquired a majority stake in the Romanian company Automecanica Mediaș, where last month it announced the production of Lynx armored personnel carriers. The group also maintains strategic alliances with companies such as Italy’s Leonardo and America’s Lockheed Martin in order to meet growing demand in European markets, including Germany and Ukraine.