The over 12.4 billion forints (EUR 38 million) with which the Hungarian Government is funding BMW’s investment project in Debrecen will reap major dividends for Hungary”, Minister of Foreign Affairs and Trade Péter Szijjártó said on Friday in Debrecen prior to signing the funding agreement with the German corporation’s representatives.

At the signing ceremony, Mr. Szijjártó also announced that according to the Government’s decision new intersections will be established on the M35 motorway in the vicinity of the new BMW plant, the minor road leading to the plant will be widened into a dual carriageway, and new container terminal will be built with an electric rail link, and new telecommunications and gas networks will be established.

“The new BMW plant in Debrecen, which will be established at a cost of over one billion euros on an area the size of 560 football pitches, will manufacture 150 thousand motor vehicles each year and create over a thousand new jobs”, the Minister of Foreign Affairs and Trade explained.

Mr. Szijjártó said it was a “special and unique” success story that BMW is constructing a factory in Hungary, in Debrecen, which is an acknowledgement of the diligence and talent of the Hungarian people, the professionalism of the people of Debrecen, and of Hungary’s economic policy.

According to the Minister, this investment is proof that it was a good decision to introduce the lowest corporation tax in Europe, to introduce dual training based on the German model, and to restructure the higher education system.

“A global, modern-day industrial revolution is going on around us”, in which the automotive industry is the determining sector, and “today, the automotive industry is the backbone of the Hungarian economy”, he explained.

According to Mr. Szijjártó, the Hungarian economy “is undergoing a dimensional change”, where it will be worth investing high-level technologies and research & development results.

“Last year, the Hungarian automotive industry produced 8 thousand billion forints (EUR 24.6bn), and this year could see yet another record for the national economy: the performance of the automotive industry could exceed 9 thousand billion forints (EUR 27.7bn)”, he added, also indicating that 91.9 percent of the vehicles manufactured in Hungary are exported.

“BMW’s investment in Debrecen furthers this momentum”, which creates a good opportunity for economic growth to remain permanently above 4 percent, the Foreign Minister said.

Mr. Szijjártó praised the fact that the some 6 thousand German enterprises operating in Hungary today provide employment to over 300 thousand Hungarians. “Germany is our largest investor, and Hungary’s number one economic partner. Hungarian exports to Germany will exceed 30 billion euros this year”, he added.

The Minister thanked everyone who represented Hungarian interests during the course of the 14 months of negotiations that preceded the announcement, particularly thanking Minister for Innovation and Technology László Palkovics, who “undertook the lion’s share in preparations for the investment”.

Mr. Szijjártó announced that in future the Ministry of Foreign Affairs and Trade and the Ministry for Innovation and Technology will be jointly submitting a competitiveness package to the Cabinet.

Member of the Board of the BMW Group Oliver Zipse said the company had examined over 160 European locations before “finding what they were looking for in Debrecen”. He indicated that the city’s approach, the excellent infrastructure, the existence of a suitable large site, and the availability of a trained workforce were all important factors in the decision, as well as the fact that both the Hungarian Government and the Municipality of Debrecen had committed themselves to launching suitable training courses.

Last year, BMW sold 2.4 million vehicles, of which 1.1 million were sold in Europe, he said, explaining the need to expand production capacity.

According to Mr. Zipse, earthworks will begin in 2019, after which construction will begin following the establishment of the environmental infrastructure, followed by the installation of machinery and robots.

Mayor of Debrecen László Papp (Fidesz-KDNP) spoke about the fact that the City Council has voted unanimously in favour of the BMW investment, “in his respect there was no governing party and opposition, only a common interest (…) that cooperation should come about between Debrecen and BMW”.

The Mayor said that Debrecen’s achievements over the past four years had been “historic”: over 500 billion forints (EUR 1.54bn) in working capital had arrived in the city, and over six thousand new jobs had been created. According to Mr. Papp, the Government is playing an outstanding role in the city’s development: “capital of this magnitude only chooses a country and a city where everyday life is characterised by stability, security and excellent cooperation”

“With the contract being signed today, Debrecen is undertaking to provide the prerequisites for the construction of the new BMW factory, making the industrial territory suitable for the investment project and putting it at the disposal of the investor in a year’s time in suitable condition”, the Mayor said, before concluding the preliminary purchase agreement with Oliver Zipse.

Following this, Péter Szijjártó and Oliver Zipse signed the contract relating to government funding.

At the event, Minister László Palkovics told reporters that the arrival of BMW means the appearance of a “wonderful world” in Hungary, which means both production and innovation capacity, and this will totally redraw the map of the region. He recalled that BMW appeared 40 years ago in a small German village with high unemployment, which is now one of Europe’s centres of innovation and training. “In comparison, Debrecen is setting out from a much better position, which can be raised even higher thanks to this decision”, he added.

The Minister said one of the important elements of BMW’s investment decision was the high quality of education in the area. He said it was symbolic that the Germany company is holding Friday’s forum at Debrecen University, and that in his opinion this means that the company is counting on the university, is counting on education, and on research and the investment environment.