"Hungary is nothing short of a business paradise", German trade union IG Metall admitted upon receipt of an Ernst & Young report it had commissioned to probe into Siemens AG's decision to move cell phone production from Kamp-Lintfort and Bocholt in Germany to Hungary.

The study found that Hungary's business climate was even more auspicious than had been outlined by the Siemens management, and that Germany would not be competitive as a location for cell phone manufacturing even if no labor costs were involved.

One relocation option is to outsource manufacturing entirely to Flextronics International Kft, which has been doing contract work for the company for more than a year; another alternative is a green-field investment by Siemens itself, possibly in Debrecen.

(BBJ 21.vi.04)