Slovakia plans to sign a ten-year memorandum of cooperation with the aluminum plant Slovalco, which suspended primary aluminum production at the beginning of 2023. This was announced by Prime Minister Robert Fico during a visit to the facility in J’yar-nad-Gronom.
This is reported by Finway
Industry Challenges and Prospects for Production Recovery
One of the key initiatives of the Slovak government is to develop a European solution to support energy-intensive enterprises, particularly through the introduction of multi-year incentives for participation in the emissions trading system. Fico emphasized that the modern Slovalco plant can produce strategically important raw materials not only for Slovakia but for the entire European Union. Currently, Europe produces about 1.2 million tons of primary aluminum per year, while market demand reaches 6-7 million tons.
“However, Europe needs about 6-7 million tons; everything else is imported from other countries. This plant could produce 17-20% of this European volume, which is approximately up to 200,000 tons of aluminum,” said Fico.
The Prime Minister stressed that due to high electricity prices, many European enterprises have been forced to halt production. As a result, most aluminum is now imported from China and African countries, where energy is primarily based on coal, leading to additional environmental pollution.
The Position of the Slovak Government on Ecology and Economy
According to Robert Fico, the main obstacle to restoring production remains the European emissions trading system. He noted that this system negatively impacts the competitiveness of European aluminum producers while promoting an increase in imports from countries with less stringent environmental standards.
The Prime Minister believes that granting temporary exemptions from the emissions trading quota system could serve as a catalyst for reviving Slovalco’s operations and ease the situation for the entire energy-intensive industry in the region. He plans to convey this proposal to other EU countries and present it to the European Commission. At the same time, Fico acknowledged that the process of agreeing on such changes at the EU level will be lengthy and complex, but he believes that the initiative will be supported by other states.
At the national level, the government intends to sign a ten-year memorandum of cooperation with the Slovalco plant. Robert Fico is also considering the possibility of excluding investments or state aid for the enterprise from the calculation of macroeconomic indicators, such as budget deficit and public debt, if agreed upon with the European Commission.