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THEIR WISH LIST: MORE LEGAL TRANSPARENCY AND LESS BUREAUCRACY

Belgian firms expand their established Slovak investments

IN MAY Bekaert, a global company with headquarters in Belgium that has been operating in Slovakia for 10 years, opened its expanded facility in Sládkovičovo in the presence of Prime Minister Iveta Radičová, Róbert Šimončič, the CEO of the Slovak Investment and Trade Development Agency (SARIO) and Bert De Graeve, the CEO of Bekaert. The expansion provided the facility with a standard manufacturing platform and vastly increased its production capacity, bringing Bekaert’s aggregate investment in Slovakia to €240 million.

IN MAY Bekaert, a global company with headquarters in Belgium that has been operating in Slovakia for 10 years, opened its expanded facility in Sládkovičovo in the presence of Prime Minister Iveta Radičová, Róbert Šimončič, the CEO of the Slovak Investment and Trade Development Agency (SARIO) and Bert De Graeve, the CEO of Bekaert. The expansion provided the facility with a standard manufacturing platform and vastly increased its production capacity, bringing Bekaert’s aggregate investment in Slovakia to €240 million.

This expansion shows how several Belgian investors have become well-rooted in Slovakia and that past economic cooperation has been fruitful.

“Slovakia certainly does remain an attractive location for any foreign investors for several pragmatic reasons,” Lucia Harabinová, the trade secretary at the Embassy of Belgium in Slovakia and the representative of the Wallonia Foreign Trade and Investment Agency (AWEX), told The Slovak Spectator, adding that an important advantage is that it is situated in the centre of central Europe. Other advantages she noted are the country’s flat tax rate as well as the possibility to receive state subsidies. “In general, and speaking in the name of several stable Belgian investors that have been operating in Slovakia for several years, I must say they do perceive stability with regard to their businesses and they prove it by their new investments in their current locations.”

Richard Dírer, SARIO’s spokesperson, confirmed that Belgian investors continue to consider Slovakia with interest and that SARIO is working on several new projects.

“We are working on five projects with aggregate investment of about €80 million, which may create 600 to 900 new working positions,” Dírer told The Slovak Spectator.

Dírer noted that the focus of interest by Belgian investors is very similar to those from the Netherlands. While Belgian investors have been primarily interested in the automotive and electro-technical industry, processing of metals and similar industries, there is interest in services as well.

SARIO has completed 13 projects with Belgian firms totalling €96.2 million in investment that had the potential to create from 1,300 to 1,700 new jobs.

In answering a question whether any new sectors had emerged in Slovakia that are attractive for Belgian investors, Harabinová cited a discussion she recently had with a Belgian firm interested in the food sector.

“Surprisingly, he was not interested in state subsidies but he was unpleasantly surprised that Slovakia has the highest VAT of 20 percent applying to this business sector in comparison with two other possible neighbouring countries,” Harabinová said. “Subsequently, the investor turned his attention elsewhere.”



Well-rooted investments



Harabinová lists Bekaert, the largest Belgian investor in Slovakia, as the primary example of a successful expansion of a Belgian firm already operating in Slovakia.



Jozef Daniel, the general affairs manager at Bekaert Slovakia, told The Slovak Spectator that Bekaert expanded its Sládkovičovo plant because the company had built an extensive customer base in the central European region and that the company needed to respond to growing demand.

“In the view of the expected efficiency and flexibility gains, Bekaert decided to expand its production platform in Sládkovičovo to serve all customers, mainly from the tire business, driven by the automotive sector present in the region,” Daniel stated. “Bekaert decided to extend its production platform in Sládkovičovo by a new unit manufacturing half-finished products.”

“By maximising use of the half-finished products, the satellite plant in Sládkovičovo has become a standard manufacturing platform that can respond to the central European market demand and Bekaert customers’ current and future growth. Half-finished products manufactured in the new unit will be 100-percent used for products made in Slovakia,” said Daniel.

Bekaert’s investment encompassed construction of a new building doubling the original plant's size, the installation of infrastructure and state-of-the-art machinery, and hiring and training one hundred additional employees, bringing Bekaert’s total employment in Slovakia to over 2,150. Bekaert produces a wide variety of steel cord and steel wire products in central and eastern Europe and currently has two manufacturing facilities in Slovakia, in Hlohovec and Sládkovičovo.

With regard to other upcoming extensions, Harabinová said that she is aware of an upcoming extension at the plant of Plastiflex, a flexible hose system producer and Aspel Slovakia in Kežmarok, which produces, assembles and sells injection-moulded plastic parts.



A wish: more transparency, less bureaucracy



After the government of Iveta Radičová took power last year, many representatives of the business community expected positive changes in the business environment. Harabinová noted that the Belgian investors keep moving within central Europe because of several factors.

“They usually do so mainly because of their customer bases and their needs, the possibility of finding an available and qualified labour force, and last but not least the transparency of the [economic and political] system,” Harabinová stated. “From the political and economic point of view Slovakia does remain a stable country no matter whether a left-wing or right-wing government is in power, therefore Belgians have come and they do continue to come.”

But Harabinová said the Belgian business community does believe there is some room for improvement and specified that entrepreneurs from Belgium would appreciate “more ‘aftercare’ from SARIO, more transparency in the legal system, and less bureaucracy in general.”

Topic: Foreigners in Slovakia


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