BUSINESS IN SHORT

Petrovany rebuffs Spanish investment

A SPANISH investor has failed for the second time to obtain land in eastern Slovakia to build a new foundry. After protests by local residents thwarted Funderia Condals’ plans to build a foundry near Prešov, councillors of the nearby Petrovany village refused to sell the investor land in the local industrial park, succumbing to the pressure of locals even before the environmental impact assessment (EIA) was completed.

A SPANISH investor has failed for the second time to obtain land in eastern Slovakia to build a new foundry. After protests by local residents thwarted Funderia Condals’ plans to build a foundry near Prešov, councillors of the nearby Petrovany village refused to sell the investor land in the local industrial park, succumbing to the pressure of locals even before the environmental impact assessment (EIA) was completed.

“It is a pity. But I accept the decision of the councillors,” Petrovany Mayor Ján Lenko said, as cited by the Hospodárske Noviny economic daily in response to the councillors’ decision not to sell the investor five hectares of land in the Hora industrial zone. But he is optimistic, believing that Petrovany will find another investor, and he expects that the land in the industrial zone will become even more lucrative after a planned connecting road to the highway is built.

Milan Karoli, the representative of SKC Foundry, the Slovak affiliation of Funderia, told the daily that when looking at the economic performance of the region, the unemployment and the family incomes, they cannot understand the councillors’ response. The Spanish investor continues to search for a new location for its foundry, while both Prešov and the Slovak Economy Ministry have already offered some alternative sites.

The unemployment rate in Prešov Region was almost 18 percent in July, standing at nearly 16 percent in the district of Prešov itself. The region has long had difficulty attracting investors, in part because of the still-unfinished cross-country highway.

Petrovany’s councillors explained that their opposition to the investment pertained to differences between the EIA and the original promises of the company, when, for example, a junkyard was not originally planned for the site.

Funderia Condals initially planned to invest about €20 million in a new foundry in the IPZ Záborské industrial park near Prešov and employ hundreds of people. This would have been one of the biggest investments in Slovakia in last few years. However, the firm backed off from its plans in June in the wake of opposition from residents nearby who feared the foundry would worsen air quality. The industrial park is located close to residential areas. The investor shifted its focus to the village of Petrovany, less than 10 km from the original site.

While in an opinion poll initiated by Lenko most residents in Petrovany supported the construction of the foundry, some citizens opposed it. About 40 people from a civic initiative against the foundry attended the August 19 meeting.

Ľuboš Vančo, managing partner of KPMG in Slovakia, considers it a problem that villages lack industrial zones with clear criteria for what kind of industry can be located there.

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