The Role of the Army and Its Economic Impact, Before and After 1989

National Strategies Observer No.2/Vol.1, 2015

16 Pages Posted: 1 Jun 2016

See all articles by Ana Maria Goleanu

Ana Maria Goleanu

Romanian Academy - Institute for World Economy

Date Written: June 1, 2016

Abstract

Our research propose a qualitative analysis of elements which has led to the restructuring of the defence industry in national area and highlighting the importance of Smart Defence Strategy in Romania, particulary and EU in general. The reduction of defense industry in Romania after 1989 was manifested mainly through the closure and retention of some production lines from the weaponry factories. Because no solution of restructuring the weaponry industry was found, the Romanian state spent, annually, big sums for paying the salaries of those who were in technical unemployment and redundancy payments for those who left the system. The circulated amount for these expenses was of over 10 billions USD, from 1990 until today. These problems would require better cooperation and responsibility at an European level, more investment into defense capability and strengthening of the European defense industry. The concept of Smart Defense may contribute to the optimization of defense, but also to the way military equipment is produced and distributed. A common strategy, with correlated outfitting and unitary coordination, is probably the next step to a common European defense. Compared to the USA, the EU states invest much less in the research and development of military technologies. If this situation continues, Europe will no longer be able to guarantee its own safety, based on it's own industrial power.

Keywords: defence economy, army preparation, smart defense, defence capability and industry, development of military technologies, defence economy

JEL Classification: Q54, Q58, Q19

Suggested Citation

Goleanu, Ana Maria, The Role of the Army and Its Economic Impact, Before and After 1989 (June 1, 2016). National Strategies Observer No.2/Vol.1, 2015, Available at SSRN: https://ssrn.com/abstract=2787624

Ana Maria Goleanu (Contact Author)

Romanian Academy - Institute for World Economy ( email )

Romania

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