Analysis on Current Investment Environment in Košice Self-governing Region Košice Self-governing Region :: Košice 2006 Analysis on Current Investment Environment in Košice Self-governing Region Košice Self-governing Region :: Košice 2006 Title: Project no.: 39/04-I/33-3.1, project reg. no. ITMS Analysis on Current Investment Environment in 15130100003 “Upgrading of Conditions to Stream- Košice Self-governing Region line Foreign Direct Investment Inflow in Košice Region” Published by: Košice Self-governing Region “The European Social Fund helps develop employ- (The original text is subject to no stylistic revision.) ment by promoting employability, encouraging the spirit of enterprise and equal chances and by making Contact Person: investment in human resources” Ing. Peter Burger Tel.: 055/72 68 226 The project is co-financed by the European Union, E-mail: [email protected] the Ministry of Labour, Social Affairs and Family, and the Košice Self-governing region. Translation: Mgr. Erika Hatalová Graphic Layout and Pre-press: Mgr. Svetozár Šomšák THE INFORMATION CONTAINED IN THIS PUBLICATION IS SUBJECT TO THE INTELLECTUAL PROPERTY RIGHTS OF THE KOŠICE SELF- Photographs: GOVERNING REGION. NO PART OF THIS PUBLICATION MAY BE RE- PRODUCED OR COPIED IN ANY FORM OR BY ANY MEANS WITHOUT Marián Krlička PRIOR WRITTEN APPROVAL OF THE AUTHORS Table of Contents Introduction 5 6.4 Unemployment 58 6.5 Education and Training 59 1. Košice Region – General Data 6 1.1 Districts of Košice Region 8 7. Institutional Encouragement, Availability of Infrastructure and 2. Legislation (Legal Environment) 11 Inflow of Investment 65 2.1 Legislation of Slovak Republic 7.1 Institutional Encouragement of Business 65 Related to Business and Investment 11 7.2 Regional Encouragement of Business 69 2.2 Legal Regulations Related 7.3 Poles of Development 70 to Industrial Parks 12 7.4 Industrial Sites Eligible for Investment 71 7.5 Economic and Social Development 3. Economic Environment 14 Programmes (ESDP) 84 3.1 Gross Domestic Product and 7.6 Selected Strategic Policies of Košice Labour Price 14 Region 86 3.2 Inflation Rate and Consumer Price Index 15 7.7 Human Resources Development 87 3.3 Price for Land and Building Grounds 18 7.8 Analysis of Entrepreneur Needs 88 3.4 Real Estate Prices 19 7.9 Mutual Benefits from Economic 3.5 Rental Rates 19 Co-operation 89 7.10 Communication between Public 4. Technical Infrastructure 21 Administration and Citizens 91 4.1 Traffic Network 21 7.11 Self-government and Employment 4.2 Electric Network 30 Agency Working together on Raising 4.3 Public Water Mains and Employment Rate 91 Available Water Resources 33 4.4 Sewer System 37 8. Analysis of Current Investment 4.5 Telecommunication Network Inflow 93 and Internet 38 8.1 Trend in Foreign Direct Investment 4.6 Waste 39 Portfolio 93 8.2 Foreign Direct Investment Inflow 93 5. Endogenous Resources 41 8.3 Foreign Direct Investment Portfolio 95 5.1 Soil Types and Area 41 8.4 Allocation of Investment 97 5.2 Mineral Raw Materials 41 8.5 Investment Incentives Granted 104 5.3 Resources of Geothermal Energy 45 8.6 Rules for Granting Individual 5.4 Natural Resources 46 Investment Subsidies 105 5.5 Cultural Heritage 47 8.7 Analysis of Investor Requirements 111 6. Human Resources 48 Index of Abbreviations 114 6.1 Demography 48 6.2 Knowledge-based Structure Resource Index 116 of Population 50 6.3 Employment by Branches of Economic Activity and Roles of Respective Branches 52 Authors: Košice Self-governing Region Michal BARTOŠ Ing. Peter BURGER Ing. Lucia BYŠICKÁ Ing. Júlia KOLESÁROVÁ Ing. arch. Anna MAREKOVÁ Ing. Mária MOLNÁROVÁ Ing. Peter ŤAPÁK PaedDr. Mária ZOLOVČÍKOVÁ Regional Development Agency Košice [AGENTÚRA NA PODPORU REGIONÁLNEHO ROZVOJA KOŠICE, N. O.] Ing. Jarmila BALÁŽOVÁ RNDr. Gejza LEGEN Ing. Jozef ŠUĽAK BIC Spišská Nová Ves, s. r. o. Ing. Ľubomíra DZIMKOVÁ Ing. Marek CHOBOT Ing. Martin KARCHŇÁK Ing. Katarína KROTÁKOVÁ Regional Consulting and Information Centre Košice [REGIONÁLNE INFORMAČNÉ A PORADENSKÉ CENTRUM KOŠICE] Ing. Vladimír CIRBES Regional Consulting and Information Centre Trebišov [REGIONÁLNE INFORMAČNÉ A PORADENSKÉ CENTRUM TREBIŠOV] Ing. Monika KOŠAROVÁ Lenka LUKÁČOVÁ Ing. Jozef MONDIK Ing. Ján PETR Co-operating Parties: JUDr. Jozef KONKOLY > Introduction The Košice self-governing region (KSGR), like • Are the local and regional self-governments many other regions in Slovakia, is now at a com- ready to respond to the investor needs? pelling stage of its development: while combating • What is the current investment situation in the high unemployment the region is also experiencing region like? a remarkable increase in interest of investors to put their capital in this specific area. This analysis represents the first phase of the project which is to come up with a thorough In order to enhance the quality of the investment survey on the investment environment and shall environment, raise the level of employment and assist in defining the investment policy, and con- stir up the economic development in the KSGR solidate the business environment in the region. an idea was born as to devise and implement a We strongly believe this project will prepare high project entitled “Upgrading of Conditions to quality professional staff capable of working with Streamline Inflow of Foreign Direct Invest- foreign investors, and in the end, helping to step up ment in Košice Region” pursuing an ambition foreign investment in the region. to strengthen all professional, human and insti- tutional capacities related to the regional invest- The Košice self-governing region – the project ment policy. The project shall output in having leader – extends acknowledgement to the follow- professionals and institutions trained in render- ing partners: ing professional service, capable of practising the acquired skills when negotiating with the parties • Regional Development Agency Košice interested in investment, and/or with the investors • Regional Consulting and Information Centre already well established in the region. The project Košice is co-financed through the EU within the EQUAL • Regional Consulting and Information Centre initiative. Trebišov • BIC Spišská Nová Ves, s. r. o. The objective pursued on drawing up the docu- ment entitled “Analysis on Current Invest- whose pro-active approach, responsibility and pro- ment Environment in Košice Self-governing fessional performance helped to develop the publi- Region” is to identify and specify both assets and cation “Analysis on Current Investment Envi- bottlenecks and analyse the current condition of ronment in Košice Self-governing Region”. the investment policy as exercised in the region. In doing so the document seeks to answer the fol- lowing questions: • Is this region eligible for attracting and devel- oping foreign and domestic investment? • Does this region dispose of sufficient engineer- ing, technology and knowledge bases? • Does this region have enough highly qualified human resources ready to meet ever-increas- ing requirements of investors? INTRODUCTION | 5 1. Košice Region – General Data The Košice region is situated in the south-east The administrative division of the Košice region of the Slovak Republic (SR). Having the area includes 11 districts. The city of Košice is divided of 6,752 m2, the region accounts for 14 % of the into four districts (Košice I, II, III, IV). The oth- Slovakia area. (The agricultural land accounts for ers include the districts of Gelnica, Košice-Vicin- half the regions´ area.) Having the second highest ity, Michalovce, Rožňava, Sobrance, Spišská Nová population (mean population as of December 31, Ves, and Trebišov. All districts, but the district of 2004 was 769,969), the region is among the larg- Košice-Vicinity, have their own district town (for est in this country. The residential density of 114.1 the district of Košice-Vicinity the role of a district people per 1 km2, on average, goes slightly above seat is, in part, played by the town of Moldava nad the national average. The districts with the highest Bodvou). density are found within the boundaries of the city of Košice. The urban settlements have 56.3 % of the The structure of urban settlements of the region population. The region neighbours with the Prešov comprises 440 municipalities, including low popu- region to its north, with the Banská Bystrica re- lation communities and 17 towns: Čierna nad Ti- gion to its west, with the Republic of Hungary to sou, Dobšiná, Gelnica, Košice, Kráľovský Chlmec, its south, and with Ukraine to its east. Krompachy, Medzev, Michalovce, Moldava nad Bodvou, Rožňava, Sečovce, Sobrance, Spišská Nová RAILWAY DISTRICTS ROADS GELNICA ROŽNAVA REGIONAL CAPITAL MOTORWAYS KOŠICE-VICINITY SOBRANCE DISTRICT TOWN PRIMARY ROAD KOŠICE I, II, III, IV SPIŠSKÁ NOVÁ VES TOWN SECONDARY MICHALOVCE TREBIŠOV ROAD FIGURE 1: STRUCTURE OF URBAN SETTLEMENTS AND TRAFFIC NETWORK OF KOŠICE REGION, RESOURCE: KOŠICE SELF-GOVERNING REGION (2004) 6| KOŠICE REGION – GENERAL DATA Ves, Spišské Vlachy, Strážske, Trebišov, and Veľké a. developed region enjoying a multi-sector Kapušany. The city of Košice is the regional capi- economic base tal working as a centre of administration, industry, b. stabilised regions having prospects of fur- economy, trade, education, and culture and history ther development of the east of Slovakia. c. problem regions • stagnant regions of single-sided orien- Following some selected indicators (statistical in- tation of their economic potential, noted dicators relevant for the development assessment for their low level of