Prague Business Journal - Article Last updated: 4th Dec 2003, 8:53 Banking & Finance Gov't & Politics Industry & Trade IT & Telecom Communications Law & Order Social Services Business Life This week's PBJ Enter keyword(s): Advanced Search Feature Q&A Expert Files Ad Infinitum Company Profile Commentary Opinion Who's news Week in review Markets Week Inside the list Restaurant review Time Well Spent This week's columns Movie Guide Restaurant Guide Calendar City Invest Czech Conference Calendar Internet Marketplace PBJ Events Newsletters Archives Advanced Search Export-Import Center FREE Registration PBJ Subscribe PBJ Store Affiliates Do Business With Us LOG IN FAQ About Us Feedback Advertise Staff List PBJ HomeGov't & PoliticsEU entry offered as best chance ... 5th Dec 2003, 1:18 Gov't & Politics 1st Dec 2003 EU entry offered as best chance for Ostrava region by Vladimir Kuchar Big infrastructure projects are favored by democratic leaders and dictators who want to prove that they're getting things done. In Ostrava and the Moravian-Silesian region, they have the opposite effect. The incomplete D47 motorway to north Moravia and the now, apparently abandoned, project to build a freight railway terminal in Bohumin stand as monuments to broken promises and government failure. Almost one person in five in Ostrava is now out of work. The jobless rate in the rest of the Moravian-Silesian region stands at 16.4 percent while average unemployment in the Czech Republic is 9.8 percent. Experts say continuing restructuring and the absence of large investors stands behind the persistently high jobless figures. About 10,000 demonstrators against soaring unemployment filled the center of Ostrava at the end of May in the largest protest the city has witnessed since the Nov. 1989 Velvet Revolution. Organized by the trade unions, the event focused on the government's failure to address the problem. Half a year on, little has changed for the better. Steelworks and mining companies continue to lay off staff. "This year is the worst so far," said Svatava Badurova, spokeswoman at the Ostrava labor office. "We have a record number of people out of work." Experts from the labor office don't expect any major investment in the next months that could alter the overall situation. "A couple of foreign investors came here, but they created dozens or hundreds of vacancies whereas we need thousands of them," Badurova said. "According to our information, no investor that would give jobs to thousands of people is heading here." New promise? After being promised almost everything else, north Moravia is now being offered the prospect of an economic miracle fueled by European Union funds to solve its economic woes. Both Prime Minister Vladimir Spidla and the President of the European Parliament, Pat Cox, have singled out the region as one that should benefit the most from European funds. Over the last 10 years, the Czech Republic has managed to spend e1 billion (Kc 31.9 billion) in EU funding. After accession next May it will have the opportunity to spend twice that amount in just two years. On a tour of Ostrava in May, Cox said the Moravian-Silesian region should be better placed within the EU to solve its problems. Cox pointed out that his native Ireland was one of the poorest countries in Europe when it joined the EU 30 years ago. Unemployment stood at 16 percent and people were leaving the country to find jobs. Unemployment is now under 5 percent, well below the EU average, and many emigrants have returned home, Cox said. Spidla also sees "significant economic growth" following EU entry that would reduce unemployment. EU structural funds will be one of the main tools, he added. Last week the city of Ostrava and the company operating Mosnov airport, owned by the regional government, took their fate into their own hands, in a small way at least. They opened an industrial zone on a site adjoining the airport. Ivo Krizatko, the director of the airport operator, said it already has 11 applications from investors who want to use the site for production and storage. Around 200 people should eventually be employed there, he said. In the zone The EU and Ostrava city council each spent e2.1 million of the e4.7 million costs of preparing the Mosnov zone. The remaining money was provided by the Ministry for Regional Development. Whether another industrial zone will make a big difference, is debatable. CzechInvest, the government agency for attracting foreign investment, has been attacked for failing to fill the industrial zones it has helped create in the region. Ten industrial zones, totaling 225 hectares, have mushroomed across north Moravia with subsidies amounting to Kc 222 million. CzechInvest says there are signs that Ostrava and the Moravian-Silesian region are beginning to attract serious investment interest. Twenty companies have shown interest in investing in the Ostrava region, of which five are described as having serious interest, CzechInvest CEO Martin Jahn said at the 4th annual Investment Forum, held in Ostrava in early October. The firms, operating in the car and electrical engineering industries, could each create 200-1,500 jobs, he said. Jahn said CzechInvest had been in talks with pharmaceutical, woodworking, engineering and textile companies about their potential entry into the Koprivnice, Hrabova in Ostrava and Nosovice industrial zones. CzechInvest spokeswoman Jana Viskova said 10 renowned firms planned to invest $1 billion and will create up to 9,000 new jobs. Foreign and Czech firms have so far invested or are in the process of investing Kc 9 billion in the region and create close to 3,000 new jobs, according to CzechInvest. Japanese bicycle gear parts producer Shimano's investment in Karvina is the biggest of the 15 investment projects attracted so far by CzechInvest. 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