China's Eve Power, the ninth-biggest battery maker in the world, will invest around HUF400bn (€1.07bn) in its first battery plant in Europe in Debrecen, Hungarian Minister of Foreign Affairs and Trade Peter Szijjarto announced on May 9.

The government will support the investment that will create 1,000 new jobs with a HUF14bn (€37.5mn) grant.

The company signed a non-binding letter of intent with the local municipality to acquire 45 hectares in an industrial area last year, Chinese media wrote earlier.

The company, whose customers include BMW, could supply the German premium carmaker with next-generation batteries from its Debrecen production facility.

A country that can attract EV battery production investments is guaranteed to secure economic growth for the long-run, Szijjarto said, projecting a ten-fold increase in demand for electric vehicles by 2030.

The German-Chinese cooperation taking place here clearly shows how much better connectivity is for the world than forming blocs, he added

BMW will produce zero-emission cars from 2025 at its new €1bn factory, and the company is building a EV battery factory from a €1bn investment in the same amount in the eastern Hungarian industrial hub, which has been a hotspot for new investments.

CATL, the world’s leading battery maker, is setting up a 100 GWh plant in the local industrial park on 221 hectares from €7.4bn, the largest greenfield investment in Hungary.

Locals living nearby the planned factory were outraged and fear of negative environmental impacts

There are concerns that the production of lithium-ion batteries could release harmful chemicals and pollutants into the air and water. The factory will be built on fertile land in the outskirts of Debrecen, a city of 200,000, whereas environmental groups want the government to consider rustzones for such projects.

Experts fear that the investment of energy-intensive industrial units will overburden the grid and tap scarce water supplies in an area increasingly hit by severe draughts.

To add to the worries of local residents, an expert of the local utility company was axed by Debrecen Mayor Laszlo Papp after he expressed reservations about the project.

The bid by opposition parties and locals to hold a referendum on the CATL investment was turned down by the local electoral committee in February.