Avia Solutions Group and Kaunas Free Economic Zone Management UAB have signed a memorandum of cooperation with regard to the development of a new aviation park in the territory of the Kaunas Free Economic Zone, Lithuania. Upon the successful implementation of all project stages the local economy will be infused with almost $40 million, and the new aviation park will become the largest center of aviation services in Lithuania.
The new aviation park in Kaunas is a major project aimed at attracting various local and foreign companies engaged in providing a wide spectrum of aviation related services, such as maintenance and repair of aircraft engine, landing gear and other components, aircraft tear down and sales as well as aviation-related scientific researches. The new center is planned to occupy the territory of up to 100 ha (247 acres), located next to Kaunas International Airport.
“Lately the demand for air traveling has been rapidly increasing all over the world. As a result, most air companies are not only expanding their fleets but also intensifying their business activity. In turn, the demand for new aircraft and aviation supporting services is also on the rise,” comments the CEO of Avia Solutions Group Linas Dovydenas. “Every $100 and 100 jobs in aviation generates $325 and 610 jobs in other sectors of global economy. Upon exploiting the currently favorable situation in the market, the aviation business area in Lithuania could easily attract the much needed investment into the country’s economy. By consistently developing an adequate supply of aviation services local businesses can not only improve the country’s export/import ratio but also contribute to the growing number of jobs and the promotion of aviation-related study programs,” says Dovydenas.
Eyes on investors from both Lithuania and abroad
Seeking to create the most business-friendly environment possible, the Free Economic Zone in Kaunas offers exceptional conditions and tax benefits for all investors choosing to develop their business activity on its territory.
“Foreign investors operating in the territory enjoy 0% dividend tax, 0% real estate tax and 0% profit tax (for the first 6 years, afterwards – 7.5% for the next 10 years). In the meantime, those operating from any other location in Lithuania are subject to 15% dividend tax, 1% real estate tax and 15% profit tax,” comments the Head of the Kaunas Free Economic Zone Management company Vytautas Petruzis.
The territory of the Free Port in Kaunas will be also adapted for the implementation of various greenfield investment projects. All works in relation to the development of roads and the provision of electricity, water and gas are being carried out already (since April, 2014) and are expected to be finished by no later than the middle of the upcoming year.
According to V. Petruzis, the territory is very appealing due to its geographical position, tax benefits, current and constantly developing infrastructure as well as the competence concentrated in the area. These are the key criteria for businesses seeking to develop or expand the existing capabilities. This is indicated by the consistent growth of investment into the Free Economic Zone in Kaunas and its ability to attract numerous leaders in a variety of sectors from all over the world.
Both parties are certain about the potential of the new Aviation Park to attract potential clients. This year one of the Avia Solutions Group subsidiaries – FL Technics – has opened a brand new aircraft maintenance and repair hangar in Kaunas International Airport located right next to the Free Economic Zone. The hangar generates an additional flow of potential clients as it already serves a large number of carriers from Europe and the CIS. Moreover, the centre is fully equipped to carry out maintenance on such modern aircraft series as Boeing 747 and Boeing 787 Dreamliners. Since 2011 FL Technics has been the partner of the Boeing GoldCare programme.
The project will significantly benefit from the experience of Avia Solutions Group and its subsidiaries as well as a wide network of its partners worldwide. The company cooperates with many globally renowned representatives of the aviation industry, including Boeing and Airbus. Therefore, aside from a wide spectrum of aviation maintenance services, in the new Aviation Park Avia Solutions Group and its partners will offer aircraft and engine disassembling, spare parts storage, sales and logistics solutions as well as engage in other aviation-related business activities. Moreover, this EU-wise unique object will house the complex of aircraft maintenance and painting facilities as currently such services are usually offered separately from aircraft maintenance and repair solutions which creates additional costs for aircraft owners and operators.
“We possess extensive long-term experience as concerns participation in various aviation infrastructure development projects in Europe and the CIS. The potential of this project is truly huge, especially considering the unique nature of some planned activities in the region. Moreover, Kaunas stands out as an exceptionally geographically convenient location with immense logistics-related benefits. This makes the city particularly attractive to many international clients. That is why we believe that the services provided in the new Aviation Park will be in demand and should particularly appeal to clients from the Baltic States, Scandinavia, Northern and Southern Europe and even providers from more distant regions across the world,” shared Dovydenas.