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Investment Climate in the Czech Republic

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Investment Climate in the Czech Republic Investment Climate in the Czech Republic Martin Partl Director D-A-CH Region Operations CZECHINVEST Investment and Business Development Agency Ministry of Industry and Trade CzechInvest HQ Prague, 8 foreign offices, 14 offices in CZ regions to support foreign direct investment mission to develop local companies to implement business-development programs to improve the business infrastructure Source: CzechInvest, 2015 Our Services for Potential Investors Business intelligence Consultancy on available financial support Identification of production facilities and offices Suppliers search Identification of potential acquisition and joint-venture partners Tailor-made visits to the Czech Republic Liaison with government bodies Aftercare services All of CzechInvest’s services are free of charge Source: CzechInvest, 2015 Priority Sectors (Investment Opportunities) Aerospace Automotive Business Support Services Energy & Cleantech Hi-tech Engineering ICT Life Sciences Materials and Nanotechnologies R&D http://www.czechinvest.org/en/target-sectors Source: CzechInvest, 2015 Czech Republic: Basic Data Population (2015) 10.5 million Labour force (2015) 5.3 million Unemployment (September 2015) 6.0% GDP p.c. in USD (PPP) (2014) 28 466 GDP growth (2014) 2.0 % GDP growth (October 2015*) 4.6 % Annual inflation (October 2015) 0.4% Average monthly wage (March 2015) € 997 $ 1, 054 Export destinations (2014) Germany (32.0%) Slovak Rep. (8.3%) Poland (5.9%) * current Source: Czech Statistical Office 2015, Czech Ministry of Finance April 2015, IMF 2015 Basic Economic Indicators **Forecast Source: Ministry of Finance. Macroeconomic Forecast. April 2015 Investment Risk Rating STANDARD COUNTRY AND MOODY ´S FITCH POOR ´S Czech Republic AA- A1 A+ Slovakia A A2 A+ Poland A- A2 A- Bulgaria BBB Baa2 BBB- Hungary BB Ba1 BB+ Romania BB+ Baa3 BBB- Russia BB+ Baa3 BBB- Note: Foreign Currency Long-Term Sovereign Debt Ratings, January 2015 Source: Czech National Bank, 2015 Global Competitiveness Index Rankings Czech Republic is at the top of the CEE countries in the competitiveness of the world economies Rank Country Score 1 Switzerland 5.76 2 Singapore 5.68 3 United States 5.61 4 Germany 5.53 5 Netherlands 5,50 ……… 31 Czech Republic 4.69 41 Poland 4.49 63 Hungary 4.25 67 Slovak Republic 4.22 Source: World Economic Forum, Global Competitiveness Report 2015-2016 Czech Republic – Competitive Economy Czech Republic ranks 31th among 140 world economies in competitiveness Competitive Advantages: (Rank) ╌ Trade tariffs (5) ╌ Prevalance of foreign ownership (6) ╌ Primary ed.enrollment (11) ╌ Soundness of banks (13) ╌ Intensity of local competition (14) ╌ Import as a percentage GDP (16) ╌ Flexibility of wage determination (17) ╌ Pay and productivity (18) ╌ Quality of electricity supply (19) ╌ Quality of railroad infrastructure (22) ╌ Local supplier quality (25) ╌ Availability of specialised training services (26 ╌ Soundness of banks (24) ╌ Country credit rating (24) ╌ Int´l Internet bandwidth (25) ╌ Capacity for inovation (26) ╌ Internet acces in schools (29) ╌ PCT patents, applications/mio pop. (28) Source: World Economic Forum, Global Competitiveness Report 2015-2016 Foreign Trade and Investment – Top 10 Foreign Trade according to turnover Foreign Direct Investment Inflow Total USD: 101.42 billions (1999-2014) (1993-2013) Share in total Share in total FDI Country Country foreign trade (%) inflow (%) Germany 30,4 Germany 22.0 Slovakia 7,1 Netherlands 17.0 Poland 5,9 Austria 13.3 China (Peoples Republic France 5.7 of) 4,6 United States 5.5 France 4,5 Switzerland 4.6 Austria 4,3 Belgium 4.7 Italy 4,3 United Kingdom 2.0 RussianFederation 3,9 Sweden 1.6 United Kingdom 3,7 Italy 0.8 Netherlands 3,3 Source: Czech Statistical Office 2015; Czech National Bank 2014 CzechInvest´s Projects Structure And Trends Number of projects (1993 – 2014) MFG SC + TC 200 180 160 140 120 100 80 60 40 20 0 Note: MFG=Manufacturing, SC=Service Center, TC=Technical Center Source: CzechInvest, 2015 Investment Incentives Supported activities -- Manufacturing industry - Starting or expanding production facilities -- Technology centres - Establishment or expansion of R&D centres -- Business support services centres - Establishment or expansion of shared service centres, SW development centres or high-tech repair centres Types of Incentives (state aid 25 - 45%, Prague 0) -- Tax incentive, corporate income tax relief for max.10 years -- Job creation grants, up to 11,100 EUR per each new job created -- Training and retraining grants, 25-50 % of total training costs -- Cash grant on capital investment (in case of strategic investment only ) Source : Act on Investment Incentives No. 72/2000 Coll., CzechInvest 2014 Sources of R&D Funding V EU Fonds -- Budget 2014 – 2020 : 22 Mrd. EUR -- All Regions supported except Prague V Technology Agency of the Czech Republic EPSILON Programme Support of applied research and experimental development ° Sub-programme 1 - Knowledge-based economy ° Sub-programme 2 - Energy and Materials ° Sub-programme 3 – Environment VMinistry of Industry and Trade Operational Programme Enterprise and Innovations for Competitiveness 4,3 Mrd. EUR TRIO Programme Support for applied research and experimental development in the are of Key Enabling Technologies (photonics, nanotechnologies, advanced materials etc.) Sources of R&D Funding V Ministry of Education, Youth and Sports -- Operational Programme Research, Development and Education -- Priority Axis 1: Enhancing capacities for quality research V City of Prague Operational Programme Prague – Growth Pole of the Czech Republic ° Priority axis 1: Enhancement of research, technological development and innovation V Horizon 2020 The EU Framework Programme for R&D Running 2014 - 2020 with a budget over €70 billion International cooperation as an important priority Czech institutions actively seeking partnerships in research consortia CzechInvest Worldwide South Korea Scandinavia [email protected] [email protected] USA – East Coast Japan [email protected] Germany [email protected] [email protected] USA – West Coast UK & Ireland [email protected] [email protected] China – Shanghai [email protected] Source: CzechInvest, 2015 Thank you for your attention. [email protected] www.czechinvest.org.
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