Nexen Tire has been granted approval by the European Commission (EC) to receive regional investment aid totalling almost EUR117m (US$128m) for the construction of a production plant in Žatec, Czech Republic.
The Commission found the aid granted by the Czech Republic was compatible with EU state aid rules, and it promotes regional development without unduly distorting competition in the internal market.
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“This tyre production plant will create at least 1,000 new jobs in Žatec and contribute significantly to the economic development of the region,” said Competition Commissioner, Magrethe Vestager.
“I am pleased we approved State aid to make this happen. It is a good use of public money in line with EU State aid rules.”
The Czech Republic notified aid measures to support the construction of a new tyre plant totalling EUR116.8m, consisting of a direct grant of EUR40m, an employment grant of EUR10 and around EUR67m from tax relief and by the authorities selling the site for the plant at a reduced price.
The project’s total investment costs amount to EUR769m and it is expected to create at least 1,000 new jobs in Žatec.
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By GlobalDataŽatec is located in the Severozápad region, an area with high unemployment and a standard of living below the EU average, which is eligible for regional aid under EU state aid rules.
