April 2010 9 out of 10 investors - Sario

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Investment News April 2010 Nine out of ten investors would come to Slovakia again 92 percent of foreign companies operating in Slovakia would repeat their investment intent also in current conditions – this is the outcome of the opinion poll conducted in 114 German, Austrian and French companies. According to the opinion of the addressed investors, Slovakia is characteristic mainly by the membership in the European Union, labor force willing to work at relatively moderate cost and calculable tax system. In the comparison with other countries of the Central and Eastern Europe, the poll participants value the Slovak Republic as the most attractive investment location. Nevertheless there are also reasons for criticism. German, Austrian and French companies can see the unfulfilled tasks of the politics especially in the field of law enforcement, fight against corruption and infrastructure development. Is Sony going to Taiwan? The Nitra plant of Japanese electronics producer Sony will go to Taiwanese company Foxconn. On Wednesday Sony announced the agreement of both parties, based on which Hon Hai Precision Industry (which operates under the trade name Foxconn) should become the majority owner of Sony Slovakia Ltd. After the completion of the transaction Hon Hai Group will own roughly a 90% stake in the Nitra plant and the Sony Group will keep around 10%. Since the new plant will assemble electronics for other makers as well, the plant’s payroll is expected to increase by 500 to 3,000 workers. Five new in Lipany Five companies are gradually launching production at the Lipany industrial park. The company Teprofa Slovakia already settled in the park last year and in its machinery production currently employs 20 people. Local company Aluminium System, which wants to launch production in 2H of 2010, will also operate in the same industry. Roughly at the same time Polish company P.P.U.H. should launch the production of concrete and products from concrete, as well as the firm ICLA, which will deal in mixing colors, paints, putties, and produce abrasive materials. The industrial park will also have a photovoltaic power plant that will be built by Tecoma Travel Agency. All of these investors will employ roughly 50 people in total. Touareg Hybrid from Bratislava The Volkswagen (VW) plant in Bratislava launched production of the Touareg Hybrid model. The Bratislava plant is the only place where this SUV will be produced. VW Slovakia thus became the first carmaker in Slovakia to launch serial production of hybrid vehicles. Last year VW Slovakia invested €199m into preparing the production of new car models. This was a 150% increase y/y. VW is also preparing the production of the New Small Family model, which should be launched at the Bratislava plant as of next year. Belgians are aiming to The East Belgian companies Eutraco (logistics) and Jonckheere (metal production) should employ almost 200 people in eastern Slovakia in total. Jonckheere is already active in Kosice. It plans to expand production and hire 63 workers, confirmed the head of advisory firm for new foreign investors Eastern Investment Centers (EIC) Dany R. E. Rottiers. At the moment, the EIC is in talks with 22 foreign investors and another six seem potential. Roughly 80% of the 22 companies, which could together create 7,000 jobs and invest €0.5bn, are heading to the east of the country. New halls in the Myjava industrial park CPN Invest, Slovak firm of Belgian owners, plans to launch the construction of a plant this year in the Myjava industrial park Javorinska for another firm of the same owners, Eurofima, which produces municipal goods. To date it operates in rented premises in Brezova pod Bradlom and employs 20 people. It should move into the new premises by the end of this year. In the new hall the number of employees should gradually increase to 100. The new hall will cost €2m, and will harbor the production of municipal goods from metal such as benches, shelters, and bus stops. The next company that will build in the Myjava industrial park this year is the Slovak subsidiary of a Spanish automotive supplier Altcam. The parent company gained new projects and orders for the Slovak plant. It plans to launch the construction work on the new plant for roughly €1.5m in June. Investment in the safe The Slovak branch of Austrian Wertheim began the construction of a new plant in industrial park in Dunajska Streda last week. By the end of September, it aims to complete two new production halls and a storage facility worth €5m, and will spend another €1.5m on technologies. The firm will produce safes and other bank equipment in the new plant, assortment that it already assembles in its current plants in Dunajska Streda and Modra. Its largest customer, which accounts for 80% of output, is Swiss Schindler. At present, Wertheim employs 460 people in Dunajska Streda and Modra, and the new plant will add 70 new jobs. www.sario.sk 2
Economy News April 2010 Slovak economy will grow the fastest According to the International Monetary Fund’s (IMF) World Economic Outlook report, the economies of Central and Eastern Europe should grow by 2.8% this year and 3.4% next year. The fastest growth should be seen in Slovakia (4.1%). In the following year it should be 4.5%. GDP growth in 2010 (IMF’s estimate): Slovakia 4.1% Poland 2.7% Hungary -0.2% Lithuania -1.6% Latvia -4.0% The National Bank is more optimistic The central bank NBS slightly improved its outlook for this year’s economic growth in Slovakia to 3.2%; until now it predicted a 3.1% GDP growth. Last year the Slovak economy contracted by 4.7% in connection with the negative impacts of the economic crisis. Next year the NBS foresees a GDP growth of 4.4%, a slight improvement on its previous estimate of 4.3%. New leader of export Last year, Samsung plant in Galanta became Slovakia’s largest exporter after years of dominance by Bratislava’s Volkswagen plant. Three carmakers operating in Slovakia ranked right after Samsung. While two years ago PSA Peugeot Citroën ranked sixth, last year it was third. Kia came fourth, while fifth place went to oil refinery Slovnaft. Analysts expect electronics to dominate exports also this year. More money from EU funds Slovakia can gain €138m more from EU funds in the period until 2013 compared to what Brussels originally expected. According to the European Commission, this is caused by the fact that the Slovak economy grew significantly faster over the past three years than was expected. In addition to Slovakia, for the same reason extra money from EU funds should also go to the Czech Republic (€237m) and Poland (€633m). The unemployment rate has decreased The growth of unemployment in Slovakia halted in March this year, dropping slightly to 12.88%. The labor office headquarters UPSVaR informed that in March this year there were 346,067 people ready to take up jobs. On an annual basis, however, the jobless rate increased by 2.55 percentage points. State aid for investors Last year the Labor Ministry paid out a total of €16.4m for individual state assistance to investors. The ministry paid €12.65m to 19 investors in the form of a contribution for the creation of jobs and €3.74m went to 13 investors for employee training. The ministry supported 3,139 jobs with these contributions. The biggest state assistance from the ministry last year went to Yura Eltec Corporation Slovakia (€3.14m as a contribution for the creation of 701 jobs). The company T-systems Slovakia gained €2.81m and another €1.74m went to the company Johnson Controls Trencin. Entrepreneurs, connect your business with the right partner! Activate one of our Entrepreneur programs to increase your business effectiveness! T-Mobile. The right partner for your business. Life’s for sharing www.sario.sk 3
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April 2010 9 out of 10 investors - Sario

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