(Bloomberg) -- Volkswagen AG’s decision to put its Turkish investment on ice has touched off a new round of contest among Balkan nations vying to host the 1.3 billion-euro ($1.4 billion) plant.
Bulgaria, Romania and Serbia are hoping that Volkswagen returns to its earlier shortlist of sites, which featured the Balkan nations and North Africa. The investment would be one of the biggest by a carmaker in any of the three countries, which have long struggled to combat corruption and improve crumbling infrastructure.
“We’ve covered all requirements by the investor and we’ve offered more than that,” InvestBulgaria Agency CEO Stamen Yanev said by phone on Wednesday. “We’re still standing well as a factor of stability in the region, as a loyal partner and we’re awaiting the final decision.”
Volkswagen on Tuesday delayed a decision on its auto factory in Turkey after the country’s military action in northern Syria prompted an international outcry. German Chancellor Angela Merkel was among the leaders calling for an immediate end to the operation, alongside European Union-wide comments condemning the offensive.
Volkswagen declined to comment, saying that it is currently Evaluating its options and will comment once it makes a decision.
The world’s biggest carmaker has struggled to compete with Asian rivals because of high costs at its factories in western Europe, which has prompted its foray to the continent’s east. Volkswagen has production facilities across the region, though some under different brands, in Poland, Slovakia, the Czech Republic, Hungary and Bosnia-Herzegovina.
The three Balkan nations are banking on still-available skilled workforce, and relative stability versus a now-turbulent Turkey, according to officials.
Serbia has also put itself out as a candidate. An investment by VW would “help stabilize the whole region,” along with the benefits for the carmaker as the area still has qualified labor for the industry, Marko Cadez, head of the Serbian Chamber of Commerce said by phone. Serbia is outside the EU so unlike Bulgaria and Romania, its workers don’t have access to jobs in member countries.
--With assistance from Andrea Dudik and Siddharth Philip.
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