Romania earmarked EUR 17 bln of soft loans under EU's SAFE scheme

The European Commission (EC) has preliminarily allocated EUR 16.7 billion to Romania through the Security Action for Europe (SAFE) scheme, which will support the rearmament of Europe through soft loans extended to member countries, according to a government press release.

The tentative allocation for Romania is the second-highest by country, after Poland, and will finance the acquisition of military equipment, investments in production capacities, and the development of critical infrastructure.

"The acquisitions of military equipment in the next 5 years will be paid from this allocation, a loan at much more advantageous interest rates than we could have obtained on our own, with a grace period of 10 years and a repayment term of 40 years," according to the government.

SAFE is operational until the end of 2030 and offers loans with a maximum maturity of 45 years and a grace period of 10 years. Depending on the state's option, a pre-financing of 15% of the loan may also be granted.

Defense minister Ionuţ Moşteanu explained that the money allocated to Romania from the SAFE program will not only go towards military equipment, but can also be used for civilian infrastructure.

"There is money that can go not only towards equipping the Army through joint European procurement, but also towards civil-military infrastructure: bridges, roads, highways, and railways that will ensure the rapid mobility of troops and equipment when our security requires it," Mosteanu said.

The government explained that the scheme has an infrastructure component: "A mixed civil and military infrastructure is proposed for financing, the completion of the motorways in northeastern Romania: A7 and A8, Paşcani – Suceava – Siret, and Paşcani – Iaşi – Ungheni, respectively."

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