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SARIO FOCUSES ON MOST PROMISING SITES

Slovakia to plant €.5 bil. in investment seeds

THE SLOVAK Economy Ministry plans financial boosters for several Slovak sites with the aim of nourishing industrial parks.
In 2004 and 2005, the ministry will allocate nearly Sk2 billion (€50 million) from public funds for the construction of industrial parks, the TASR news wire reported.
The state investment promotion agency SARIO has selected the 17 best locations to absorb the state support and attract investors.

THE SLOVAK Economy Ministry plans financial boosters for several Slovak sites with the aim of nourishing industrial parks.

In 2004 and 2005, the ministry will allocate nearly Sk2 billion (€50 million) from public funds for the construction of industrial parks, the TASR news wire reported.

The state investment promotion agency SARIO has selected the 17 best locations to absorb the state support and attract investors.

However, the state is not likely to pour money into new projects before current constructions are finished, Economy Minister Pavol Rusko told the press.

Rusko said that the interest of foreign investors has been a key factor in selecting the sites.

Among other criteria for state support is a minimum size of at least 15 hectares, ample technical and transport infrastructure, and appealing labour and demographic potential, according to news wire SITA.

SARIO registers 14 projects in the advanced preparation phase and 25 planned industrial park projects, of which 17 are of top priority.

Aside from the Žilina site reserved for Korean carmaker Hyundai/Kia, the localities are spread throughout all the regions, namely the Bratislava region (in the towns of Malacky and Pezinok), Trnava (Senica), Nitra (Nitra, Zlaté Moravce, Levice), Trenčín (Dubnica nad Váhom, Trenčín, Bánovce nad Bebravou), Banská Bystrica (Banská Bystrica, Lučenec, Detva), Žilina (Martin, Liptovský Mikuláš), Prešov (Lemešany, Prešov), and Košice (Kecerovce).

Slovakia currently has nine industrial parks, two of which, in Vráble and Kechnec, were raised with governmental support.

One of the most prepared industrial zones in Slovakia, the Kechnec Industrial Park, which houses newly constructed public infrastructure financed by the government at the price of Sk184.3 million (€4.45 million), officially opened in late October 2003.

According to Rusko, the state aspires to support the rise of new industrial zones and boost the mobility of the labour force, which could be a cure for the heavily unemployed regions.

Investors tend to prefer new industrial parks instead of rebuilding existing industrial facilities, which are often an ecological burden.

However, several municipalities and local officials feel overlooked by SARIO and claim that the state-fed agency has not assisted them in their effort to lure foreign investors or prepare plans for their industrial parks.

In defence of SARIO, the economy minister said that the agency would only support promising projects.

"Why should SARIO care about sites in which no foreign investor has so far been interested? [Complaining] municipalities are griping in vain that SARIO has no time for them. It [SARIO] must devote its time to investments that have potential and that can be accomplished," Rusko told the Financial daily Hospodárske noviny.

According to the daily, SARIO promotes only eight industrial parks on its website and is reluctant to provide private firms with information on prepared parks.

SARIO was launched in 2000 as a one-stop shop for investors, bringing together the resources of six ministries and the National Property Fund. It is currently working on 109 investment projects worth a total of almost €3.3 billion.

In mid November 2003, the Economy Ministry said it planned to revise the law on industrial parks, while the most dramatic change would be to lower park co-financing by municipalities from 30 to 5 percent.

However, Rusko has been critical of the operation of SARIO in the past and removed Ladislav Balko from its top post on October 16, 2003, for what he called "the deficient operation" of the agency.

The minister said that the manager failed to efficiently communicate with automotive producer Hyundai over its planned investment project in central Europe.

Late last year, Slovakia and Poland were shortlisted by Hyundai for the site of a $1.5-billion (€1.18 billion) Kia Motors production unit with an estimated annual output of 300,000 cars, beating out the Czech Republic and Hungary in a battle for the greenfield investment.

The agency was instrumental in attracting PSA Peugeot Citroen's €700 million investment, announced in January 2003.

However, the ministry will insist on more transparency in the operation of SARIO, Rusko told The Slovak Spectator in an earlier interview.

Rusko wants SARIO to operate more independently from his ministry and take the initiative to get in touch with potential investors.

"I expect an agency like SARIO to be active and not only elaborate strategic documents and analyses.

We can order an analysis, as there are many companies doing analyses. SARIO is supposed to go out, look for contacts, and persuade people," Rusko said.

By 2006, SARIO plans to open at least nine branch offices to support foreign direct investments in the Czech Republic, Germany, Great Britain, Belgium, the United Arab Emirates, Russia, Japan, and the United States.

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