VICTORIA, Romania -- At the base of Romanias Fagaras Mountains, a sprawling chemical plant that was founded in 1938, in part by weapons giant Rheinmetall to produce gunpowder for Nazi Germany, stands rusting and unused. Now Germanys Rheinmetall is returning.

The German armament company plans to build a gunpowder plant, which locals hope will revive the fortunes of Victoria in the central Transylvanian region.

Plans forthe 535 million euros ($626 million) gunpowder plantin Victoria come amid a massive rearmament drive from Brussels to help Ukraine fight its ongoing war against Russia.

TheReArm Europe Planhas seen several industrial towns throughout Europe buoyed by deals to invest hundreds of millions of euros to reequip the blocs militaries. Romania isset to receivesome 16.7 billion euros ($19.4 billion) from the fund, largely for defense-focused reindustrialization projects.

Ioan Muntean

Ioan Muntean worked for 50 years at the now mothballed Victoria Chemical Complex. He summarizes its complex history through World War II in one succinct sentence as he picks his way through his former worksite. Until 1944, Russian prisoners worked here, then from 1944, German prisoners worked here."

After Romania switched sides late in that war, the country was occupied by Soviet troops and the Victoria factory became the Stalin Chemical Plant until shortly after the Soviet rulers death in 1953.

Under Romanian communist dictator Nicolae Ceausuescu, the Victoria plant produced methanol and formaldehyde, among other industrial products.

The factory employed some 2,700 people in the 1950s, but began a slow decline through the late communist era which accelerated following the 1989 revolution that overthrew Ceausescu.

Distillation towers in the Victoria Chemical Complex.

Muntean reaches out to touch some of the familiar pipes of the silent factory. I know all of these by heart, he says, I know them inside and out. After clambering up to a platform on one of the towers of the plant, the former worker points out the various components of the factory which are slowly being subsumed under weeds.

Beyond the factory grounds, Victoria, the workers town that was built up around the factory, is visible over the trees. The population of Victoria has plunged, roughly in line with the declining output of its factory. From 10,000 in 1992, the population dropped to just 6,500 in 2021.

Then-Romanian leader Nicolae Ceausescu (right) and his wife, Elena, visit the Victoria Chemical Plant in August 1982.

In the tidy but empty streets of Victoria, local resident Doru Cioata says that at the end of the 1990s many people left for Italy and Spain. An entire generation of residents disappeared. The business owner says finding workers for any local enterprise is now all but impossible.

The planned German gunpowder factory is likely to herald a turn of fortunes for the town. The factory plans to employ some 700 people, many of whom would arrive with families, meaning many hundreds more may relocate to Victoria.

As he clambers back down to the ground, Muntean lets out a sigh. While there is now hope for the town outside, the factory that he knows so well is likely to continue its decay. It wasshut down completely in early 2025following years of wrangling over its fate.

A railway tanker on the territory of the Victoria plant.

Rheinmetalls new facility will be built on land owned by the historic factory but will not make use of the Victoria Chemical Complexs infrastructure. The site is blessed with a high quality water supply essential for gunpowder production but Rheinmetall has opted to build a new facility from scratch on the mountainside land.

Construction of the new plant, to be called the Victoria Explosive Powder Factory, is set to begin in 2026 and is expected to last three years. Rheinmetall has alsoannounceda number of other planned projects in Romania including an excellence center, where local workforces will be trained in manufacturing.