The local council of Gyula on Wednesday decided to establish a company to take over the assets of a troubled sausage maker where hundreds of residents work.
Mayor Ernő Görgényi, a member of governing Fidesz, announced the decision, which had been expected, at a press conference after a meeting of the council. The council voted to establish Gyulahús, wholly owned by the local council, to take over the assets of Gyulai Húskombinát, which is under liquidation.
The plight of the company, whose sausages were granted "protected designation of origin" status by the European Commission in 2010, has been a matter of concern not only for locals, but for the government. Late in December, HUF 1.8 billion was allocated from the central budget under a government resolution to finance unspecified "tasks" in the city of Gyula. The mayor said the money would be used to preserve jobs and make economic developments.
A Commission official warned the government earlier in a letter that government support for Gyulai Húskombinát could constitute illegal state aid, but farm ministry state secretary Gyula Budai said that government action to preserve jobs in Gyula would be strictly within the boundaries of the EU's legal framework.
Görgényi said Gyulahús would be headed by two men with an intimate knowledge of Gyulai Húskombinát's operations: Zsolt Daka, the technical director of Gyulai Húskombinát at present, and Ferenc Dékány, who headed Gyulai Húskombinát before its privatisation and later oversaw operations at peer Csabahus in the 90s.
Daka stressed the importance of keeping an uninterrupted supply of Gyulai products in shops. He added that Gyulahús would turn out the full palette of Gyulai meat products.
State secretary Budai, also present at the press conference, said the state would have a significant influence on Gyula's meat industry in the future through the local council. "The state is a good owner, and it must play a bigger role where possible," he said.
Gyulai Húskombinát traces its history back to a slaughterhouse built in Gyula in 1868. The company, whose sausage won the top prize at the Brussels International Exhibition in 1935, was nationalised in 1948. It was privatised in 1996, bought by Hungary's HAGE.