Political Turmoil and Factory Opening, Rio Tinto Without Permits, Japanese Companies Investing in Serbia – 2021 Retrospective, Investments in Industry

Source: eKapija Wednesday, 26.01.2022. 12:07
(Photo: Shutterstock/Jason Benz Bennee)
Rio Tinto is the company which marked the year 2021 when it comes to investments in industry.

The project of the exploitation of jadarite, a mineral rich with lithium, in the Jadar valley has led to polemics, arguments, finally culminating in protests and pressures on the Government of Serbia to stop the construction of a mine near Loznica.

As the situation grew increasingly tense, eKapija’s readers accordingly paid more and more attention to this topic. We tried our best to deliver relevant information to our readers. We reported the statements made by experts, officials, followed the events regarding the administrative procedures, all to the end of providing a full and in-depth insight into the subject. We managed to do so in the end, because it is precisely the project of Rio Tinto in the Jadar valley that is the topic of the most read article on the list of investments in industry.

However, despite this being the dominant topic in the past period, the fact that other investments, the construction of production facilities, the opening of factories, also drew a lot of attention should not be forgotten. This shows that the events in the industry of production potential are followed with great interest.

1. Jadar Project – Lithium Mine

At the moment, it’s impossible to talk about this project without mentioning the fact that the whole situation finally ended with Rio Tinto having all its permits cancelled. Once announced as a groundbreaking investment that was supposed to contribute significantly to the GDP growth, but also the development of the industry due to the potential construction of a battery factory, it all ended with the decision of the Government of Serbia to have the British-Australian company leave Serbia and to have its right to the exploitation of the ore banned.

How did we go from the idea that Serbia is lying on billions of euros to no longer needing this resource? In June, academy member Vladimir Stojanovic caused quite a stir in the public by saying that the construction of the lithium mine was akin to “slaughtering an ox for a kilogram of meat”.

In a letter sent by a group of academy members to the minister of mining and energy of Serbia, Zorana Mihajlovic, he explained his position by saying that the exploitation of lithium does not just jeopardize the Jadar valley, but that the whole Serbia is in danger. As he said, the plan of the construction of the mine entails the establishment of a tailings pond of 160 hectares with a protective foil of 1.5 millimeters. According to him, this is insufficient. The ore would sooner or later reach the soil, which would destroy the fertile farming land of the Jadar area. Regarding the economic feasibility of the investment, Stojanovic emphasized that mining had not led to the development of either Bor or Majdanpek and concluded that the stories about green mining amounted to a pure deception of the public, “because such mining does not exist”.

When these negative comments on the Jadar project appeared, a response followed by Vesna Prodanovic, the director of Rio Sava Exploration. In an interview for our portal, she pointed out that the processing of jadarite in sulfuric acid at under 100 degrees Celsius was planned, which would prevent the evaporation of harmful matters. There was also plenty of talk about what the overall situation in the society was like and why a negative attitude toward mining had formed in the public.

After the arguments were exchanged in the media, a struggle about administrative procedures followed. The minister of construction, mining and infrastructure of Serbia, Tomislav Momirovic, announced in December that the ministry had issued location requirements to Rio Tinto. Protests and pressures on the institutions to put a stop to the whole thing followed. In an attempt to save what can be saved, the prime minister of Serbia, Ana Brnabic, attempted to present to the public the thesis about how it is not possible to take away the rights to exploitation from Rio Tinto, due to legal stipulations. In hindsight, that was not a strong argument and those who opposed the project finally won out. It remains to be seen what kind of a victory this will prove to be.

(Photo: Carole Castelli/shutterstock.com)

2. Minth Automotive

The second spot features the news about the investments of the company Minth Automotive, which plans to realize the construction of factories in Sabac and Loznica.

The president of Serbia, Aleksandar Vucic, announced in March 2021 that the Chinese company could start building a factory in Sabac. According to him, that is an excellent opportunity for the economic development of the city, because, after the announced increase in the number of jobs at the Japanese company Yazaki, a new investor is arriving.

In Loznica, announcements of the construction of Minth’s facility for the production of aluminum car parts date back to 2019, and it was only in August 2021 that the local self-government published the tender for the preparation of the detailed regulation plan that would enable the beginning of the realization of the project.
(Photo: Shutterstock/nitpicker)

3. Continental

The Serbian market was very dynamic for this German company last year. At the beginning of the year, the construction of a new factory in Novi Sad was announced. The value of the investment was EUR 140 million, and the employment of 500 workers was planned in the first round.

The announcements made in January came true two month later. The mayor of Novi Sad, Milos Vucevic, first announced the beginning of the operations of the Continental factory in this city, but also announced the opening of another facility. On March 7, the factory started working. During the official opening ceremony, it was pointed out that not only dashboards and displays for cars would be made at the production facilities, but that the range of products would also be expanded to include smart systems. At the ceremony, which was also attended by the president of Serbia, it was revealed that Continental would build a new facility in Kac.

Announcements don’t end there, however. In November, the German company announced that that the first phase of the works on the facility in Kac had been completed, and the potential opening of another factory in Nis was announced as well. This rounds up a very dynamic period in the operations of Continental, which, at the end of last year, employed 75,000 people at its facilities, and the number is expected to grow in the upcoming period.

4. Nidec

The construction of a factory of the Japanese company Nidec in Novi Sad has attracted attention from not just the local public, but also the global one. The Japanese business daily Nikkei reported about this investment, where it was said that USD 1.9 billion would be invested.

After the initial announcement which came from the local media, the mayor of Novi Sad, Milos Vucevic, announced that Nidec was looking for a good location for the construction of the factory. As he said at the time, on that occasion he hosted Kintaro Izumida, Vice President of Nidec.

Soon after this information spread on social media, Vucevic confirmed that Nidec was buying two parcels worth nearly a billion dinars for the construction of the factory.

– These are two parcels of 212,000 m2 for the construction of facilities for business activities in the secondary and the tertiary groups. The Government of Serbia has reached the decision determining that this is a project of importance, and the price of RSD 993,669,292.60 has been defined for the parcels. Novi Sad is to get this sum if the investment of the Japanese giant is realized – the mayor of Novi Sad, Milos Vucevic, said on his official Instagram account.

(Photo: Africa Studio/shutterstock)

5. Exploitation of Gold Near Zagubica

Fifth on our list is the news about the early public review of a working version of the spatial plan of the special purpose area for the exploitation of gold at the exploration area Potaj Cuka-Tisnica, opened by the Ministry of Construction, Transport and Infrastructure of Serbia.

The plan, which was prepared by the Institute for Architecture and Urban Planning of Serbia, was commissioned by Avala Resources d.o.o. Beograd, which operates within the Canadian company Dundee Precious Metals from Toronto.

The Potaj Cuka-Tisnica future mine gold sites are located in the southeast part of the municipality of Zagubica, and the exploration space also encompasses the southwest part of the municipality of Majdanpek, according to the plan.

More concretely, the spatial plan encompasses parts of the Zagubica cadaster municipalities of Laznica Selo, Laznica Seliste and Zagubica, as well as Jasikovo and Leskovo in Majdanpek. The total area covered by the plan amounts to around 292 km2.

The exploitation of the site will take seven years. The plan is for the gold ore to be exploited through quarries, and the processing of the oxide ore, for the purpose of getting gold, will be done by the pickling method.
(Photo: ElevenEs)

6. Gigafactory of Lithium Batteries in Europe

Companies ElevenEs and EIT InnoEnergy announced a strategic partnership on the construction of the first big factory of LFP lithium-ion batteries in Europe. Subotica had been chosen as the location for the factory, and the company announced jobs for up to 2,000 employees.

This new drew a lot of attention from the readers of our portal, and it was announced at the time that the pilot production would start in 2023.

As we exclusively revealed, the factory is supposed to start being built this year.

– The construction of the facility will begin in late 2022, and the future factory will spread on 160,000 m2. The idea is to “wake up”, through the opening of the factory, another 10-15 companies, which could be our potential suppliers and to help local companies which could assemble batteries. We have a strong industry which is capable of it, except that they don’t know that yet. A total of 2,000 workers will be employed at the factory, but, indirectly, we expect at least 10,000 people to benefit, whether directly or indirectly – says Nemanja Mikac, founder and CEO of ElevenEs.

ElevenEs, an industrial spin-off of the multinational Al Pack Group, which specializes in aluminum processing and has been operating on the packaging market for 25 years, has developed its own technology to produce lithium-iron-phosphate batteries that are more sustainable and efficient.

The company, which has been conducting R&D into LFP lithium-ion batteries since October 2019 opened an advanced research and development center in Subotica, Serbia, last year, where it employs an international team of engineers and scientists.
(Photo: Ministarstvo za inovacije i tehnološki razvoj)

7. Serbian-Chinese Industrial Park in Borca

This project had been announced for a long time, and last year we learned about what it might look like, so the potential beginning of the construction is eagerly expected.

In February, the cabinet of the minister without a portfolio in charge of innovations and technological development opened the tender for the consultant for the support to the realization of the project. The tender envisages for the future consultant to provide the service in the realization of the plan and take part in the preparation of the strategy.

Not long after this tender was published in February, in early March a new tender for the preparation of the spatial plan was published. Finally, in mid-2021, the public was able to see the study of the spatial plan.

According to the study, the Serbian-Chinese Industrial Park will be built in the northwestern part of Belgrade on an area of 483.5 hectares and be split into three zones: International Commercial Center, Industrial Park and High-Tech Zone. The entire area is also planned as a construction area, where science centers, commercial features and residential-office complexes will be built.
(Photo: North Engineering/Urbanistički projekat, screenshot)

8. Employments at Toyo Tires Factory in Indjija

It’s already been mentioned that eKapija’s readers carefully follow the events in the field of industry, which is also proven by the fact that the eighth spot on our list belongs to the news about the beginning of the employment of workers at the new facility of the Toyo Tires factory in Indjija.

The Manpower agency was hired for the employment of workers, and a special office at the trade center Vegas also opened.

9. Bizerba in Valjevo

In the ninth spot is the news article about the opening of the production facility of Bizerba in Valjevo. This is a world-famous producer of scales and measuring equipment.

The information was confirmed at the session of the City Council of Valjevo, and it was announced that the new factory of the German investor, worth EUR 33 million, which will initially have 305 full-time employees, would be located in the new Business Zone in the suburban settlement of Goric.
(Photo: Pixabay.com/Pashminu Mansukhani)

10. Yanfeng in Kragujevac

Finally, the tenth spot of our list features the news about the opening of a Yanfeng factory in Kragujevac. In this case as well, it is somehow confirmed that February is the month for announcements of big investments. At the beginning of the month, the information was announced that the company was preparing the opening of a new facility for the production of safety systems for cars, with the focus on airbags.

In August, the construction of the factory was completed, and, as announced at the time, the production process should begin this year, and the creation of 500 new jobs is planned.

We presented the 10 investments that drew the most attention from our readers when it comes to industry. Make sure to take a look at the full list HERE.

We also invite you to take a look at the investments that marked 2021 in the fields of SPORTS, TELECOMMUNICATIONS AND IT, TOURISM, ECOLOGY, UTILITY INFRASTRUCTURE AND ENERGY, HEALTHCARE and AGRICULTURE AND FOOD INDUSTRY.

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