CZECH REPUBLIC
In the Heart of Europe


V.I.P. INTERVIEWS
Interview with
ING. ALEŠ ZEDNIK


The Lord Mayor of Ostrava
Ostrava, the 2nd of December 2002
Tel: +420 596 283 131
Fax: +420 596 118 861
www.mmo.cz




First of all let me congratulate you for your recent election and becoming of the Lord Mayor of Ostrava. To begin with, I would like you to introduce us your professional background and your main priorities after becoming Mayor of the second biggest town in the Czech Republic.
Ostrava is now at the crossroads. We expect a continuing decrease in metallurgy and our main goal is going to be to find other job opportunities for the people that lost their jobs in the heavy industry. That is why all the five main political parties had included attempts for the solution to these problems. The most important is the active support of employment, secondly it is the infrastructure development and transport, and thirdly, what we call "to bring life back to the city". Our town still bears the signs of the previous lifestyle and we would like to change old image of a dirty city into a modern town that would be attractive for everybody. We would like to bring nightlife to the town and to ensure the safety and cleanness for the inhabitants. Quite important issue that goes hand in hand with the support of the employment is to use again the now empty "brown fields", territories that were previously used by the heavy industry and are now polluted, and solve the environmental problems present there. Such spaces cover about 27% of the town. We want to use them because we do not want to destroy the green areas for new industries. We would like to use these "brown fields" for cultural purposes, living, and development. We have about 16.8% unemployment at the moment and it seems that if we do not do anything this number will continue to increase. With the decrease of the industry, hundreds of jobs will disappear and with the current investments, only tens of jobs are created. There is therefore a great imbalance. We would need foreign investment to create a synergetic effect so that our small and middle-sized businesses could join the chains and thereby create new jobs.

What would be the sectors that could be potential for foreign investors?

I think that we should utilise the fact that there is already industry in our town and we should focus mainly on heavy industry. We have well-developed machinery production and chemical industry.

There are several projects underway already around the city, such as investments in industrial zones and other facilities. Could you name some of the most important ones and what are your plans?

We have very good experience with foreign investments. One such example is the investment of the French company Suez into the sewage system. In the area of heat, there is another French company, Dalkia. Based on this experience we discovered that with these investors along also comes fair dealing with the employees and good business culture. From this point of view we believe that the ideal investment would be in the automobile industry, which with one job creates ten employment opportunities. The top technology of Nová Hut Ostrava and the production of sheet metals for cars are the best examples. In the discussion with the foreign investors we have to know their conditions and we have to clean the polluted area. I am going to have a meeting with the Minister of Environment on Friday and I would like to ask him for an increase of financial help for our region to be able to deal with that problem in a more effective way. There are two main environmental concerns. The first is the so-called "oil lagoons" that remained after the fuel production, and secondly it is the lower part of Vítkovice where the soil was contaminated by the metallurgy. The zone is right next to the cleaned area Karolina, where the cleaning and monitoring of the space should continue in the following year. As this area is close to the town centre we believe it could become an alternative centre of the town, such as La Defanse is in Paris, but of course much smaller.

What would be the specific incentives that you would offer to foreign investors coming to this region?

We co-operate closely with the company Czech Invest. It is a good partner because it can find the optimal partner within the Czech Republic for us. We have created a special manual for investors where you can see the specific zones that we have prepared. One of the best areas is by the airport Mošnov, which used to be a military airport, and it is able to receive all kind of airplanes. It has already attracted an investor from Iceland, which is going to use it for the repair of Boeing Jumbos there. The smaller zones should serve the middle and small-level businesses. Part of this offer is also today's free zone, which could offer duty free production. Then there is also a great opportunity for big investors. Currently we have a piece of land that is used for agriculture, but we expect it to become an industrial zone. Another important site is near Hrabová, where there is a place ready for about middle-sized investment. The area of lower Vítkovice, which has to be cleaned up first, will in the future offer good development opportunities as it is near the infrastructure and the center. We also expect to build a zone near Šilherovice. The preparation of this zone was stopped by a local referendum, I believe the opposition of the local people arose from the lack of information from the authorities. I believe that the referendum should take place again and that it should be passed. Ostravas biggest asset is its region and that is why I believe we should continue in rebuilding and developing the "brown fields" rather than take up other green areas.

One of the most important developments in the region is the construction of the highway. What benefits will it bring to the town and how do you plan to use it? And of course it would bring also new challenges so how you are getting ready for them?

The highway is absolutely crucial -- for the development of industries such as the automobile industry because of logistics and "just-in-time "supply. The highway is therefore the most important thing from the investor's point of view. There should be another seven industrial zones along the highway in a chain. The highway should also make the transport of tourists willing to see the beautiful surroundings of Beskydy, Jeseníky, Odersko easier and more comfortable. These places offer great possibilities for leisure. We can offer within a circle of forty kilometres three golf courses. The largest one in the Czech Republic has twenty-four holes, the traditional one in Šilherovice has eighteen holes and then there is a club playground in Kravare with nine holes.
The Czech Republic is situated in the heart of Europe. What are your expectations once the country enters the European Union? What positive effects it would have on Ostrava?
It could be advantageous for us if we enter along with Poland because the borders, which are only a few kilometres from here, would open. It could be good for investors who are involved in supermarket chains, as the potential of Polish customers is very high. Poland is a Catholic country, which means that the shops are all closed on Sundays. Here in Ostrava, on the other hand we got used to shopping on the weekend,
so our shops are all open and that is good for the Polish people also, yesterday, for example you could hear mainly Polish in the Shopping City. Another advantage we expect is the possibility of funding from structural funds of the EU. It is an extremely important opportunity for Ostrava because the money we can provide from our own budget will be very limited after 2004. We increased the budget from selling of shares we had in power supply and gas works. That enabled us to increase the investment budget to 2.5 billion Czech Crowns for the last, this and the following year. The year 2004 should allow us to find new sources for further developments. We gained experience from using the pre-accession funds like Phare and we saw we could develop successful projects that were highly evaluated in Brussels. Therefore, we believe we could offer such projects that would allow us to use the structural funds. Another advantage would be the student exchange. Many young people leave our region because they do not believe they could get a good level of education here. The technical university here has a very high standard and could offer the foreign students education of high quality. Our students would not only gain in language skills, but also get experience and self-confidence that the students of their age have abroad.

Ostrava has the potential of becoming a region of culture and business also. What are your plans in marketing all these possibilities?

The town has to begin the marketing process, which is called "investor relation". We have a special economic and development sector, which is under the responsibility of the Deputy Lord Mayor; previously marketing was not considered important. We have a highly qualified person now for this job who was involved in the development of Northern Moravia. I think we need more professionals in this area. The marketing should along with Czech Invest have the purpose of attracting foreign investors. We also created a Commission for European Integration, where the issues we discussed earlier should be discussed. We want to say not only what we expect from the EU, but also what we can offer. Our town went through a very hard path. We are in a very similar situation as there was in Wales for example, where specialised conferences based on these experiences take place under the name "Life after steel". We want to ensure a good standard of living for the local people despite the fact that the steel industry is decreasing. Culture is one of the ways how to enrich the life of the inhabitans and visitors of the city. Ostrava offers a lot of important cultural events every year and we are trying to use this fact in the marketing of the city, too. People thinking about coming to our city should know that they will have many possibilities to attend well known international festivals like the music festival Janáceks may or the festival of the puppet theatre Spectaculo Interesse and other concerts, performances or exhibitons.
We should not also forget about leisure. I have a project for a leisure centre deep in my drawer. It is deep in the drawer because the returns from this would not cover the costs of building such a centre. The local people could not afford to pay the entrance tickets due to their low incomes. We have possibilities here in geological respect. There is the problem of pumping out water from the unused mines. This water is salty, has a temperature of about 29°C and has the characteristics of seawater. Therefore we could use it and develop a sea aqua-park here, with water that would be for free. Today this salty water is a problem for us, because it has to be treated before it can be let into the river. We can also use water from dams and wells for free. The possibility of building an aqua-park is often discussed. However, the surrounding towns and villages are talking about such a project too and we are afraid that they could be quicker. The problem is that they consider less costly projects but we believe that, since we have such opportunities, we should use them to build something of a large scale that would be unique within a circle of 400 kilometres. But of course, the bigger the investment the more difficult it is. And again, the question of the cost of the entrance ticket comes back.

Do you have already any serious interest from companies in the aquapark project?

I have not met any specific investor yet, but we have made a very good study of the quality and the use of water.

Mr. Lord Mayor, what would be your message to our readers, who will read about Ostrava and the Czech Republic?

The location of our town is very advantageous on the long run. We offer the best opportunities in the region of Moravia and Silesia. We are much further in the restructuring and development projects compared to Poland. We welcomed investments earlier than they and that made us more open. Another advantage is that the nearby Slovak region is hungry for investment and there is a big need for employment. The erasure of borders could make our region very attractive, due to the good access to the Polish and Slovak markets. These markets are more "closed" than ours are. Despite the protests of smaller-sized businesses, we believe that the main incentive for economic development is the support of larger businesses, which are then later joined by the smaller ones. We would be happy if opportunities were given also to local investors in with respect to construction, steel construction, and construction materials, because we have a very good base for these. We would be glad if a new business culture would come along with the new investors, such as it is in the case with Suez and Dalkia. That would also improve the business culture here as well. I believe that our region will remain focused on the industry, but the heavy industry will not be the core. Instead, it will supply the needs of the new investors.

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