Romania on Tuesday said it cancelled a tender won by France’s Naval Group for building four warships after the two sides failed to sign any contract.
The French defense firm won the 1.2 billion euros ($1.3 billion) contract in 2019 to build four Gowind corvettes and renovate two more in partnership with Romanian company Constanta Shipyard.
But the contract was never signed, despite both NATO countries wanting to boost security on the Black Sea, which gained strategic importance after Russia invaded Ukraine almost 16 months ago.
“The decision to cancel the specific procedure was taken… since the successful tenderer did not sign the framework agreement within the time limits requested by the contracting authority,” Romania’s defense ministry said in a press release.
The Dutch group Damen was also fighting for the contract and came second. However, Romania says there are no funds available to match their offer.
“The funds required to declare the next-placed economic operator the winner were not identified,” the press release added.
Romanian media have speculated that the deal was not concluded due to attempts to change the initial contract terms, particularly regarding costs.
The bidding for the contract had already been mired in scandal.
According to media, Romanian officials had previously attempted to sabotage Naval Group’s bid and award the contract to Damen instead for “political reasons.”
Spurred by the war in Ukraine, Romania, which is a member of NATO, has raised its defense spending to 2.5 percent of its GDP in 2023, up from two percent last year.
It has also increased NATO missions and has several thousand alliance soldiers on its soil, including a battlegroup led by France.
The country is pushing for the modernization of the army and planning to buy equipment, such as second-hand US-made Abrams tanks, submarines, and anti-mine ships.
Earlier this year Romania acquired 18 Bayraktar TB2 combat drones after signing a 321 USD million contract with Turkey’s company.
