As part of a wider plan to draw more foreign investment to Slovakia, the government July 18 approved a manual outlining steps municipalities must follow when asking for state contributions towards the construction of industrial parks.
Such parks are preferred by foreign investors as locations for new facilities, as the land is already secured and freely available for building, which is not always the case with private land. The construction of new industrial parks will draw more investment and hence jobs to Slovakia, say present and potential investors.
The government has said the new manual will help speed the process of setting up the parks, and lauded it as an important help for towns and cities, spelling out exactly how they can ask for the funds.
However, some municipal officials argued that manual or not, there was little hope of more industrial parks springing up across Slovakia.
"The manual is a good thing for those municipalities which have decided to ask for donations, but there are still many projects which have been left in the drawers of municipal offices because it's simply financially too difficult to launch an industrial park even with government donations," said Michal Vaškor, head of the district office in the western Slovak town of Malacky.
Under legislation passed at the end of June, towns can ask the government to cover 70% of the cost of a park's infrastructure construction.
However, funding the remaining 30% of construction often proves too much for many municipalities, forcing them to drop plans for industrial park projects, said Vaškor.
"This is the reason why municipalities only talk about construction of industrial parks, but never make requests for government donations. I think that there will be pressure to reduce the 30% contribution that has to be made by municipalities," Vaškor said.
Documentation help
The new manual is a guide including and explaining 16 documents which municipalities have to deliver to the Economy Ministry when requesting the government funding. The documents cover basic information on the park's location, its description, purpose and a business plan for the park. The towns must also deliver copies of documents related to land ownership and contracts from energy, water and gas utilities.
The government says that by giving the guide to municipalities it will facilitate the construction of the parks. "With this manual, we want to help municipalities navigate [parks' construction] the right way and simplify the whole process of getting the correct documents for each request and thus increase the number of projects," said Martin Kapko, head of the foreign investment department at the Economy Ministry.
However, the government has so far provided funding for just one project - Slovakia's only complete industrial park, in Vrable, south-east of the western Slovak town of Nitra. Some municipalities, including Humenné, Spišská Nová Ves and Rožňava in eastern Slovakia have bypassed the ministry, and asked for funding directly from the European Union.
Although the government has admitted that industrial parks are an important weapon in the competition for investment in central Europe - neighbouring Hungary has more than seven times as much foreign investment per capita as Slovakia, and more than 100 times as many industrial parks - it is unlikely, Kapko said, to provide a higher proportion of funding than at present.
"The initiative to launch an industrial park and boost a region has to be in their [municipalities'] hands. We cannot give them more than 70% of finances for the construction," he said.
