The Is Experiencing a Period of Robust Boom

Fall in Unemployment Rate

Stricter Measures to Protect the Consumer

The Czech Republic – King Among Spa Venues

Pardubice Region

09–10 2006 CONTENTS

Ministry of Industry and Trade

CZECH BUSINESS INTRODUCTION Question of the Month for Martin Tlapa, Deputy Minister of Industry AND TRADE and Trade...... 4 Economic Bi-monthly Magazine with a Supplement is Designed for Foreign ECONOMIC POLICY Partners, Interested in Cooperation with The Czech Republic Is Experiencing a Period of Robust Boom ...... 5 the Czech Republic Trade of the Central European "Foursome" Is Picking Up ...... 7 Fall in Unemployment Rate ...... 9 For the Ministry of Industry and Trade of the Czech Republic Issued by: INVESTMENT Investment for More Than 2.3 Billion Euros...... 11 PP AGENCY s.r.o. Myslíkova 25, 110 00 Praha 1, Czech Republic PP Agency BUSINESS AND PRODUCTION Company with the ISO 9001 certified quality Stricter Measures to Protect the Consumer ...... 12 management system for publishing services New Ways Of "Changes" Are Popular Among Businessmen...... 15 EDITORIAL BOARD: Martin Tlapa (Chairman), Ivan Angelis, EXPORT Zdena Balcerová, Jiří Eibel, Zbyněk Frolík, Examples of Successful Czech Exports...... 14 Růžena Hejná, Alžběta Honsová, Josef Jílek, Ivan Jukl, Marie Košťálová, Marie Pavlů, Pavla Podskalská, Josef Postránecký, Libor Rouček, REGION Jiřina Semanová, Jarmila Škvrnová, Ivan Voleš NUTS 3 - Region ...... 16 – 29

MANAGING EDITOR: Jana Vápeníková SERVICES The Czech Republic – King Among Spa Venues ...... 30 EDITORS: Where Else But to the Czech Republic?...... 34 Jaroslava Bradová, Naďa Vávrová

REGULAR COLLABORATORS: PRESENTATION OF FIRMS Eva Tomášková MY HOTEL s.r.o...... 2 Lázně Teplice nad Bečvou a.s...... 35 TRANSLATION: Vlasta Benešová, Alena Kenclová, M.I.P., a.s...... 36 Petra van Benten-Knotová, Robert Krátky, Dagmar Šímová, Daniel Thelen, KORADO, a.s.; ELMET, spol. s r.o.; Východočeská tiskárna, spol. s r.o.; Callipso Halka Varhaníková ProSport s.r.o.; Lázně Teplice v Čechách a.s.; GRANDHOTEL PUPP , READ: a.s.; COSMETIC KARL HADEK INTERNATIONAL s.r.o.; Hotel Zámeček Mikulov; Mathew Booth, Ivana Kadlecová, CENTRUM BABYLON, a.s. Katherine McCloghry, Zuzana Pavlíčková

GRAPHIC DESIGN: Miloslav Bucvan, Helena Dvořáková Cover: www.orangedisc.cz

DEADLINE: 31/07/2006

ADDRESS: Myslíkova 25, 110 00 Praha 1 Czech Republic Phone: +420 221 406 623, +420 221 406 626 Fax: +420 224 934 383 e-mail: [email protected] www.ppagency.cz www.mpo.cz/cbt Press run: 13.500 copies. The number of printed and sold copies View of the historical part of Pardubice of the journal is verified by auditor, HZ Praha, s.r.o., member of PANNELL KERR FORSTER Worldwide. It is not allowed to reproduce any part of the contents of this journal without prior consent from the editor. Attitudes expressed by the authors of articles carried by CBT need not necessarily be consistent with the standpoint of the Publisher. MK ČR E 6379, ISSN 1211-2208 „Podávání novinových zásilek povoleno Českou poštou, s. p., odštěpný závod Přeprava, č. j. 3468/95, ze dne 24/10/1995“

Trade of the Central European "Foursome" Is The Czech Republic – King Among Spa Venues Picking Up

3 | INTRODUCTION

Question of the Month for Martin Tlapa, Deputy Minister of Industry and Trade

Why,in your opinion,have the WTO talks Would you consider the adoption of in Geneva on trade liberalisation failed? a more moderate version - the so-called The WTO negotiations were suspended, not "light liberalisation" - useless,as the terminated. Participants to the negotiations American negotiators see it? include 149 WTO members, who are not I encountered the reference to "Doha light" in a uniform group either in terms of their a standpoint by John Engler, President of the achieved level of economic development, or US National Association of Manufacturers, in terms of their interests and priorities in who said in a commentary on the talks that the negotiations. It is apparent that finding "no deal is absolutely better than a bad deal". an agreement acceptable to all members is This is the position of a representative of not an easy task. In addition, certain major American manufacturers, who urge their players have been reluctant to agree to negotiators to win an agreement that "must a compromise that, with regard to the benefit American manufacturers as well as situation on their domestic political scene farmers and services-providers". In my (e.g. forthcoming elections), could turn opinion, it is not productive to judge the voters away. The "apple of discord" was the submitted package by the criteria of one issue of domestic support to agriculture: the interest group. Perhaps the participant most commitment offered by the USA did not entitled to speak on the subject of "low- meet the expectations of the other trading calorie" negotiations is the EU which, for the partners. I do not fully share the view of the sake of resuming talks after the failure in former WTO Director-General Peter Cancun, allowed three of the four so-called Sutherland that WTO members have failed Singapore issues (public procurement, trade to reach consensus because they insist on and competition, investment) to be dropped concluding an agreement that is perfect. from the agenda. In addition, the ambitions of However, I concur with his conclusion that the submitted proposals surpass the results of we should adopt a good agreement, one the previous Uruguay Round. Specifically: which has been within our reach for some undertakings under consideration include time. removing all agricultural export subsidies by 2013, improving market access along the south-north and south-south axes, providing Who will lose out the most? quota-free and duty-free access to the First and foremost, the suspension of markets of developed countries for the least negotiations is a negative signal for the developed economies, and concluding system of multilateral trade relations. a multilateral agreement on the facilitation of Multilateral agreements and rules bring the trade. A clarification and improvement is most benefit to those who are unable to foreseen for rules governing the application of conclude similarly advantageous trade protective measures and for the Aid for Trade agreements on the level of bilateral mechanism. relations. The ambitions of the ongoing broadly conceived round launched in Doha, Qatar, in 2001 are high. The adopted What was the position of the Czech principle of a single undertaking and Republic? balanced outcome means that potential The Czech Republic is an advocate of liberal failure would be to the detriment of all trade policies. This approach is in accordance parties, as access to the markets of new fast with the structure of our economy, with its developing economies in Asia and South strong dependence on foreign trade and focus America would not improve. The on the export of services. Naturally, at the next MORE AT: suspension will also delay pressure for the session of the so-called 133 Committee of implementation of an agricultural reform in Permanent Representatives of EU member www.mpo.cz the USA which, together with the EU states in September, I will present the Czech common agricultural policy already in place, Republic’s interest to resume negotiations as www.czechtrade.cz would significantly help to remove soon as possible. I am bound to do this both imbalances in trade in farm products. by the "power of attorney" delegated to me www.ceb.cz Moreover, the situation governing market to promote the interests of our business access will not improve for the providers of sector, and the current European Commission services - the sector of the future. There will mandate for WTO negotiations. Together with www.egap.cz be no agreement on quota-free and duty- our allies in the EU, we want to exert pressure free access of the least developed to exercise this mandate in full in future, www.export.cz economies to the markets of developed especially the manoeuvring scope and countries, nor any agreement on the flexibility it offers. facilitation of trade.

| 4 CZECH BUSINESS AND TRADE

The Czech Republic Is Experiencing a Period of Robust Boom

The Czech economy achieved Czech economic growth gradually which has been joined quite recently also a record 6.1 % growth last year. gained in strength last year, until by the TPCA car plant. The success of achieving a record 6.9 % at the end these companies is reflected in the It thus joined the group of the of the year. The first quarter of this year significant growth of car export (+22.6 % fastest growing EU economies beat even this record, when GDP grew to in 2005), which contributes decisively to and with Slovakia shared the as much as 7.4 %. However, on the basis the Czech Republic’s balance of trade of seasonally adjusted data it can be surplus. It should be noted that the fifth position in GDP growth assumed that the first quarter represents surplus in the road vehicles category has rate. This result is particularly a climax of the Czech economic boom to more than doubled since 2003, up to the good as compared to the euro date and that the next quarters will bring current CZK 171 billion (about EUR 5.9 area, which grew 4.6 times lower growth rates. By no means, billion - May 2005). however, does the slowdown of economic slower, as well as to the EU as growth mean an end of the boom, but INVESTMENT HEADING NOT a whole, which recorded only a return to values sustainable over the ONLY TO CAR PLANTS 2.3 % last year. The record longer term, as former strong pro-growth From the viewpoint of the demand side of economic growth accelerates the impulses especially from the car industry GDP, its growth was furthered the most by are being gradually exhausted. The net exports last year. This year the main process of the Czech quickening economic growth of the role has been taken over by domestic economy’s catching up with the previous quarters thus establishes high demand, but net exports still contribute to EU level. According to Eurostat statistical base figures from which this economic growth as imports are lagging year’s economic dynamics will derive. behind exports (although this may not be data, GDP per inhabitant A gradual deceleration of GDP growth obvious from the monthly current prices increased last year to almost rate to 5 % can thus be expected at the data). The Czech economy is beginning 73 % of the EU average and the end of the year, but the annual result will to rely increasingly on domestic Czech Republic thus overtook probably break last year’s record. consumption, and also on investment based on the continuing inflow of foreign the weakest member of the GROWTH IS DRIVEN BY THE capital (including re-invested profit) and former EU fifteen - Portugal - MANUFACTURING INDUSTRY, low interest rates, which mostly remain and assumed the position of the SERVICES A DISTANT SECOND below the euro zone rates level. Last 17th most developed EU country. From the viewpoint of the supply side of year’s inflow of foreign direct investment GDP it is thus no surprise that Czech GDP (FDI) was the second highest in the history growth has been fuelled for over two of the Czech Republic. Of the total of EUR years mainly by the fast developing 8.8 billion that flowed into the country, manufacturing industry, which is followed less than a half was represented by at a distance by some branches of revenues from the sale of privatised services. The good economic results are companies. However, the total FDI extent mainly due to foreign-controlled is better documented by its overall volume companies in the manufacturing industry, in the economy, which climbed to almost which have made extensive investments in EUR 52 billion at the end of the 2006 first this country in the last few years, oriented quarter. The Czech Republic thus retained at the production of goods for Western its second position in FDI per inhabitant in markets. The structure of exports shows the region of the Central European new that the role of the leader is played by the EU member states. Foreign investment, car industry, represented for a long time and the growing profits of domestic firms, by the successful Škoda Auto company, created conditions for the continuation of the investment wave, which is likely to further intensify this year. In addition, big FDI in the offing is a promise that the Graph 1: Economic growth of the Czech Republic Czech Republic will not lack foreign % 8 investors in the future years either. The 7 6 biggest investment will be made by the 5 Hyundai automobile factory, which plans 4 to locate here its plant with an output of 3 2 a minimum 200 000 cars. Besides 1 automobile makers and their supplier 0 -1 networks, also service providers figure -2 prominently as investors are moving their -3 logistics and development centres to the Czech Republic ever more often. 1998Q1 1998Q4 1999Q3 2000Q2 2001Q1 2001Q4 2002Q3 2003Q2 2004Q1 2004Q4 2005Q3 The success of the Czech economy is year-on-year quarter-on-quarter well reflected in the living standard of the Source: Czech Statistical Office population. Real wage growth is

5 | ECONOMIC POLICY

maintained at between three and four per cent, unemployment has been falling and, on the other hand, the confidence of the population in the economy is growing. Despite a slight acceleration in wages their dynamics trails behind labour productivity rates. There is no explosion of consumption because people are increasingly investing in housing thanks to mortgages being available at low interest rates. Thus, it is still true that households increasingly prefer investment in housing to short-term consumption.

GROWTH WILL CONTINUE The Czech economy continues to grow at a record pace this year as well, despite the high prices of imported oil and natural gas, which increase the costs of companies and households and are negatively reflected in production and consumer prices. These cost pressures notwithstanding, inflation remains relatively low, and, in addition, is influenced to an ever greater degree by the growth of regulated prices, and thus makes it possible to maintain low interest rates that are favourable for the economy. The quite low interest rates can partly compensate the impact of the long-term Czech currency appreciation. Last year alone the crown strengthened in relation to its reference currency (euro) by more than 7 %, and has gained another 2 % since the beginning of this year. We assume that the Czech Republic will maintain its position among the fastest growing EU countries also in 2006 and its economic level will advance to as much as 76 % of the European average. This result will be assisted not only by the continuing interest of investors in the Czech market but also by a boom in Western Europe. Optimism for a good result is also being The growth of GDP in the CR witnesses a record growth

Graph 2: Foreign trade balance (annualised, in CZK billion) increased by money from the EU funds,

200 which are directed at projects in infrastructure and environmental 150 protection. In this area the Czech Republic 100 still has an untapped potential, and thus 50 also great opportunities. 0

-50

-100

-150 Petr Dufek -200 Analyst I.02 I.03 I.04 I.05 I.06

VII.02 VII.03 VII.04 VII.05 ČSOB road vehicles crude oil + natural gas goods total (e-mail: [email protected]) Source: Czech Statistical Office Photo: www.orangedisc.cz

| 6 CZECH BUSINESS AND TRADE

Trade of the Central European "Foursome" Is Picking Up

All the new EU members from The abolition of customs duty and the 2.68 %), which, however, is a substantially the Central European region elimination of administration limits larger economy. Taking into consideration, the boosted significantly trading of the CR, export efficiency of the Czech economy is showed an increase in trade with Hungary, Poland, and Slovakia. The intensity therefore higher than that of Poland. Still in their foreign partners after of their trade exchange with foreign countries, 1999, Polish exports to the EU accounted for joining the EU. The Czech however, was without any doubt also only 1.4 % of total EU25 imports and their influenced by the rapid economic growth in share was smaller than that of Czech exports Republic, however, was the only the past several years, typical of the entire (1.5 %). one to score a remarkable Central European Region. All the countries Measured by the change of the size of the success in the aggregate mentioned above raised their share of exports shares, due to its very good starting position in parameter measuring the result to the EU25 in relation to the EU total imports. 1999, the competitiveness of the Czech In 1999, the Czech Republic accounted for Republic rose slightly less in comparison with of trade with other countries: 1.5 % of total EU 25 imports, and in 2005 for that of Poland or Slovakia – as the share of its while Hungary, Poland, and as much as 2.6 %. Interestingly, in the year of exports to EU25 in relation to its total imports Slovakia did not eliminate their its joining, its share rose by nearly one-fifth, from EU25 between 1999 and 2004 rose 1.71 foreign trade deficit in the past which was the highest increase in comparison times, while Polish exports rose 1.86 times and with Poland (+14 %), Slovakia (+6%), and Slovak exports 1.80 times. The least successful six years, the CR in 2005 showed Hungary (+5 %). In 2005, the share of Czech from this point of view was Hungary, whose a favourable balance of trade. exports to the EU in relation to total EU share rose only 1.38 times. According to these Noticeable is the improvement of imports rose slightly less on a year-on-year indicators, optically the Czech economy made basis (more slowly than in the case of Poland less progress in comparison with the two this country’s competitiveness: and Slovakia), but the figures for the two years countries mentioned above, but in this regard last year, Czech exporters raised it was 0.5 p.p. higher than in 2003, the same its position in 1999 must be taken into their share of aggregate EU25 as in the case of Poland. The other two account, with a share of 1.5 %, was markedly imports to 2.6 % (in 1999 the countries increased their shares much less, better than that of the other three countries which is especially true of Hungary. With less (the share of Poland 1.44 %, that of Hungary share was 1.5 %), which is than two years of its membership of the EU 1.35 %, and Slovakia 0.59 %). approximately the same as that of Poland, whose economy, Chart 1: Development of the shares of commodity exports of four Central European countries and EU 25 in relation to their GDP however, is substantially larger 80 in size (2.5 times in terms of 70 GDP). The fact that over the past 60 50 six years the share of Czech 40 exports to the EU in relation to 30 20 EU aggregate imports rose by 10 0 three-quarters, is further proof of 1999 2000 2001 2002 2003 2004 2005 the great ability of the Czech Czech Republic Hungary Poland Slovakia EU25 economy to compete on Source: Czech Statistical Office developed markets. the share of Hungarian exports in relation to SLOVAK ECONOMY Joining the European Union in aggregate EU imports rose by only +0.1 p.p. IS THE MOST OPEN May 2004 was a dramatic A similar development was shown by the One of the indicators published by Eurostat is Slovak economy, which is much smaller in size. the share of the exports and imports of change for the economies of countries in relation to their GDP expressed in each of the new Central COMPETITIVENESS current prices, the criterion of the openness of European member states. The MEASURED BY CHANGES a country’s economy is considered. It shows OF THE SHARE IN EU IMPORTS that the new Central European EU members stronger the trade links were The change of these shares illustrates the are much more open than the EU25. Poland, with the old EU states and their development of the trade of the countries too, whose exports in 2005 accounted for trading partners in the group of being compared better than the rates of approximately 31.3 % of GDP in current prices the new ten countries then the growth of their trade expressed in euros. At (less than one-third and 1 p.p. less than in the same time, this indicator of changes in the 2004), and imports for 32.4 % of GDP, is change was even more dramatic. shares partly influenced by the countries’ showing greater openness than the EU as economic structure and the resulting a whole – in EU25 last year the shares of both contribution of foreign trade to the growth of exports and imports accounted for 28.5 % (in GDP illustrates the development of the 2004 for 27.4 % and 27.0 %, respectively). competitiveness of the countries concerned. Hungary, the CR, and Slovakia are showing With its 2.57 % share of exports in total EU25 substantially greater openness of their imports in 2005 the Czech Republic ranks economies than is the case of the EU25, as immediately after Poland (with a share of can be seen in Chart 1. Last year, Czech

7 | ECONOMIC POLICY

average year-on-year growth of machinery exports in 1999-2004 is shown by the CR and Poland (17.3 % and 17.2 %, respectively), with Hungarian machinery exports growing more slowly (by 13.7 % annually on an average). In the year of its accession to the EU, the Czech Republic increased its exports by more than one-quarter (by 25.5 % in comparison with 2003), which was the fastest growth in comparison with Poland (+21.9 %), Hungary (+17.3 %) and Slovakia (+15.4 %).

THE ROLE OF IMPROVED EXPORT OPPORTUNITIES According to average quarter-on-quarter growth rates calculated from Eurostat figures, in 2005 the German economy did better than in 2004. Figures for GDP in current prices show an increase from 0.3 % to 0.5 %, for GDP in constant prices an increase from 0.1 % to 0.4 % (the data are adjusted seasonally for the number of working days). This development is showing an increase of export opportunities for the Central European countries under review. This is logical in view of the great importance of the German Accession to the European Union has intensified the exchange of Czech goods with other countries market for their exports. This finding is supported by the growth of German imports, exports accounted for 64 % of the simplification, the rather lower intensity of which in 2004 grew by an average 2.2 % on country’s GDP with a 1.8 p.p. year-on-year Hungarian and Slovak exports can be a quarter-on-quarter basis, while in 2005 the growth. On the contrary, in Czech imports, explained by the non-existence of an growth was 2.5 %. Imports into the euro- which in 2005 amounted to 62.6 % of GDP, immediate cross-border link, as in the case of zone rose as well, growing from quarter to the year-on-year share declined by 0.6 p.p., the CR and Poland). quarter from 2.1 % to 2.3 % in 2005 on an with the subsequent effect of improving the average. The area of the common European Czech balance of trade. The greatest degree GROWING PROPORTION OF market also improved from the exporters’ of openness is shown by Slovakia, with the MACHINERY EXPORTS point of view, when in addition to Germany value of exports exceeding two-thirds of GDP While in 1999 the Czech Republic exported last year average quarter-on-quarter GDP (in (68.1 %) and the value of imports close on goods to the value of EUR 24.6 billion, of current prices) also rose both in the euro-zone three-quarters of GDP of the Slovak Republic which machinery and equipment were worth and in the EU25. Apart from this, the Czech (73.4 %). EUR 10.8 billion, in 2004, according to Republic also benefited from faster growth in Eurostat, total Czech exports exceeded the ten countries, which are its largest outlets: the GERMAN MARKET REMAINS EUR 54 billion mark, with machinery exports economy grew in Italy, Great Britain, and the THE GREATEST OUTLET... amounting to EUR 28.4 billion. Their share Netherlands. On the contrary, a slight decline For all the four countries under review, the thus rose from 43.8 % in 1999 to 52.6 % in took place in Austria and France. main export partner is Germany. This feature is 2004. The highest proportion among the For the Czech Republic, it is also important most evident in the case of the Czech "foursome" under review is shown by that imports rose on the part of other big Republic, which in 1999-2004 nearly doubled Hungary (62 % in 2004), with a 6.4 trading partners, to whom the CR exports its its exports to Germany (from EUR 10.6 billion p.p increase in comparison with 1999, while in goods, for example Slovakia (No. 2 export to EUR 20.3 billion), the same as Poland (from the case of the CR the increase was 7.8 p.p. outlet with an 8.6 % share of total Czech EUR 9.3 billion to EUR 18.0 billion). Most Although Poland raised the proportion of exports), which every quarter of last year dynamic, however, was the growth of Slovak machinery in its total exports over the period increased its imports from the CR by 5.3 % on exports to the German market, but with a low of five years by as much as 9.7 p.p., in an average in comparison with 3.5 % in 2004. volume in comparison with the other comparison with the remaining countries Higher growth was also recorded by exports countries (from EUR 2.7 billion in 1999 to EUR under review it is still low (35.8 % of total to Great Britain, which is the sixth largest 6.4 billion in 2004). Hungarian exports to Polish exports in 2004). Slovak machinery outlet for Czech exports with a share of Germany grew more slowly in the period exports, too, are relatively low, amounting to 4.6 %. under review (from EUR 9 billion to EUR 14.1 less than half of the country’s total exports, billion). Evidence of the strong ties of Czech although they rose from 38.2 % in 1999 to exports to the German market is the fact that 45.7 % in 2004, which in comparison with Drahomíra Dubská in absolute terms, the CR exports to Germany the remaining countries is the fastest average Macro-analysis Dept., Czech Statistical Office more than Poland, which also has a common year-on-year growth (+18.8 %) in the period (e-mail: [email protected]) frontier with that country (with some under review. Approximately the same www.czso.cz Photo: www.orangedisc.cz

| 8 CZECH BUSINESS AND TRADE

Fall in Unemployment Rate

According to a report by the UNEMPLOYMENT RATE adequate experience and education. An Ministry of Labour and Social DIFFERS BY DISTRICT example of this situation are the newly The rate of registered unemployment for built factories, who report half of their Affairs, unemployment rate the month of June was 7.7 (May 2006 - hired employees to be foreigners, even decreased to 7.7 % in June 2006 7.9 %, June 2005 - 8.6 %,). The lowest though there is a high unemployment rate from 7.9 % in May of the same unemployment rate was in the districts of in the region. year. By the last day of June, Praha-východ (-East) and Praha- západ (Prague-West) (both 2.2 %), Prague MAIN FACTORS ARE employment bureaus had (2.8 %), Mladá Boleslav (3.3 %), Benešov DEMOGRAPHY AND THE 451 106 persons on file, 11 936 (3.6 %), and Pelhřimov (3.7 %). The rate GROWTH OF THE ECONOMY less than by the end of the of unemployment higher than the There is an interesting point in the country's average was found in 31 statistics: during the past years, previous month. In comparison districts: Most (20.5 %), Karviná (17.9 %), unemployment rate always stagnated in with the same period in 2005, Teplice (15.9 %), and (14.2 %). June because fresh absolvents from the overall number of job The rate of registered unemployment for schools appeared on the labour market seekers is lower by 38 982. From women was 9.6 % and 6.3 % for men. which compensated for seasonal jobs very Differences in unemployment rate of well. In some years, the seasonal jobs on the overall number of job individual districts are caused by the so offer were even weaker and the seekers, 422 925 is reachable, called structural unemployment. That unemployment rate rose by one tenth of which is 8 800 less than by the means employers offering jobs but having a per cent point. It is not the case this year end of the last month. In problems finding suitable employees with – the decrease in the rate of comparison with the same period in 2005, the number of Employment and unemployment rate reachable job seekers is lower by 4820 580 68 982 persons. 4800 560 4780 540 4760 520 4740 500 4720 480 4700 460 employed

4680 440 unemployed 4660 420 4640 400 4620 380 1.Q.2004 2.Q.2004 3.Q.2004 4.Q.2004 1.Q.20052.Q.2005 3.Q.2005 4.Q.2005 1.Q.2006 quarter employed employed – without seasonal unemployed unemployed – without seasonal Source: Czech Statistical Office

unemployment by 0.9 % from the previous year is due to the fast growth of the economy and demographic factors. The economic boom enables companies to create new positions while the demand for them is lower because people from weaker years are entering the labour market and people from stronger post-war years are retiring. While there were 8.6 applicants per one job position one year ago, today the number is 5.2.

CZECH REPUBLIC IS BELOW EUROPEAN UNION AVERAGE The harmonised rate of unemployment produced by EUROSTAT for international comparison reached 7.1% in the Czech Republic for May. In other EU countries it was the following: EU25 8.0 %, Germany 8.7 %, Spain 8.3 %, France 8.3 %, Ireland 4.1 %, Italy 8.0 % (December 2005), Economic boom and foreign investment make it possible for enterprises to create new jobs Hungary 7.2 %, the Netherlands 3.9 %,

9 | INVESTMENT

People with adequate practice and education have no problem finding work

Austria 4.4 %, Poland 16.0 %, Slovenia of unemployed with secondary education unemployed university educated persons). 6.1 %, and Slovakia 15.2 %. without school leaving exam. Long-time The overall number of persons unemployment is seen less in the group of unemployed for more than four years UNEPLOYMENT unemployed with secondary school decreased by 5 600 to 62 500. IN THE 1ST QUARTER education with school leaving exam Daniel Kubát Average number of unemployed persons in (41.3 %) and in the group of persons with Economist the 1st quarter decreased by 3 900 when university education (39.8 % of all (e-mail: [email protected]) compared to the 4th quarter in 2005. The number of unemployed persons reached 414.1 thousand, of which 221.7 thousand were women (53.5 %). In comparison with the 1st quarter of the year 2005, the EVER GROWING NUMBER OF THE CZECH REPUBLIC CITIZENS overall number of unemployed decreased COMMUTES TO WORK by 15 000. The majority (72.0 %) of the unemployed are persons with secondary Even though foreign investors may get the impression that the Czechs do not like to school education without school leaving commute to work, it is not so. According to data from the Czech Statistical Office, over exam and persons with primary school 660 thousand employees commute to a different district or region every day, sometimes education. There has, however, been an for hundreds of kilometers. The incentive being a shortage of jobs in the place of their increase in the number of university home. Some 170 thousand persons commute to Prague only, some of them all the way educated unemployed persons when from . From the Central Region it is a hundred thousand, while ten years compared to the 1st quarter in 2005. An earlier it was one third less. People are not put off by the fact that they must spend long extraordinarily large portion of long-time hours on the road every day. It is the young university educated people without unemployed are from the group of commitments who commute in ever growing numbers. Sometimes there is as much as unemployed with primary school half of the employees who have their permanent residence hundreds of kilometres from education (67.5 % of all unemployed with the capital. From the point of view of professions, it is mostly people working in industry primary school education); it is over half of and building who commute the most.

all the unemployed (51.6 %) in the group Photo: www.orangedisc.cz

| 10 CZECH BUSINESS AND TRADE

Investment for More Than 2.3 Billion Euros

In the first half of 2006, SHIFT TOWARDS MORE often their standard is higher than that of CzechInvest, the business and SPECIALISED the companies’ branches in West Europe PRODUCTION built before. investment promotion agency A welcome feature is that most The best proof of the favourable mediated 84 new investment investments go to regions with high development of the Czech economy is the projects, both foreign and unemployment rates. The Moravia-Silesia fact that for the first time investors coming domestic. Thanks to these Region has been found attractive by 20 from the Czech Republic (23 projects) hold investors (CZK 37.8 billion, i.e. approx. first position in the number of new investment projects worth more EUR 1.26 billion) and the Ústí Region has projects. Traditionally, they are followed by than CZK 70 billion (more than been chosen by 18 companies (CZK 74 German investors (19 projects) and the EUR 2.3 billion), more than billion, i.e. approx. EUR 250 million). The third place is held by the USA (10 projects). 17 500 new jobs will be created structure of projects within the branches is For example, Czech projects being improving as well. Still strongly prepared in the Moravia-Silesia Region are in the Czech Republic in the next represented are the automobile and at the same time among the largest. few years. engineering industries, but even here Vítkovice Cylinders, a company specialising "In comparison with the same a distinct shift towards more complicated in the manufacture of high-pressure period of last year, the number and more specialised production can be bottles intended for the reconstruction of observed. Investors in the Czech Republic motor vehicles to be driven by LPG, is of new projects has increased by 14, the number of new jobs SURVEY OF THE LARGEST INVESTORS IN THE FIRST SIX MONTHS OF 2006 promised by investors will be up Investor Sector Country of origin Jobs Region Locality by 9 500 and the total value of Hyundai Motor automotive Korea 3 000 Moravia- Nošovice investments has grown by as Company Silesia much as CZK 45 billion (approx. Automotive Lighting parts for Germany 632 Highlands Pávov EUR 1.5 billion)," said Tomáš the automobile (Vysočina) industry Hruda, Managing Director of IPS Alpha electronic Japan 2 000 Ústí Žatec CzechInvest Agency. "Out of the Technology equipment nad Labem total number of projects, 21 are VÍTKOVICE metalworking Czech 114 Moravia- Moravská projects with high added value, CYLINDERS Republic Silesia Ostrava Behr parts for the Germany 130 Moravia- Mošnov i.e. investments in strategic automobile industry Silesia services or technological centres." are building new manufacturing plants preparing a project to cost approximately fitted with the most up-to-date CZK 1 billion (approx. EUR 33 million), technologies and equipment, so that very which will create at least 114 new jobs. Another prospering Czech firm is Ostravské opravny a strojírny engineering works planning to invest up to CZK 430 million (EUR 14.3 million). As a result of its enlargement and modernisation, another 170 workplaces will be created. The company is one of the largest manufacturers of railway freight vehicles and spare parts. The third example of a successful Czech firm is the Finidr Company, which will provide employment to 186 people. Its investment in Český Těšín will amount to CZK 482 million (approx. EUR 16 million). It will make soft and hard book bindings.

Alžběta Honsová CzechInvest (e-mail: [email protected]) Vítkovice Cylinders specialises in the manufacture of high-pressure bottles www.czechinvest.org Photo: Vítkovice Cylinders

11 | BUSINESS AND PRODUCTION

Stricter Measures to Protect the Consumer

Recently, the Czech Republic has DETERRING FINES? may be lodged, and about guaranty repairs. taken a number of measures to Fines for all violations of rules laid down The non-fulfilment of these new obligations by the act on the protection of and other duties imposed by the law may be protect consumers. These consumers have been raised from the original punished by fines up to the fixed level. measures cover both the actual maximum amount of CZK 1 million to CZK 50 protection of consumers against million (from approx. EUR 33 000 to EUR 1.7 UNFAIR BUSINESS PRACTICES unfair business practices and the million). Also increased were fines provided From the beginning of this year, the for by the general safety of products act, the advertising regulation act banned advertising regulation of advertising, prices, act on the technical requirements of products making "special offer" without there being and legal provisions concerning and the food and tobacco act. The aim of a sufficient supply of goods guaranteed in the enforcement of the right to these measures is to deter businessmen from respect of the expected demand. This ban is violating the law. This, however, does not only the first of a number of bans to prevent intellectual property. In an effort mean that the highest possible fine could be deceitful and aggressive business practices to prevent unsuitable business imposed even for a small offence. In contained in the new EU directive on unfair practices, state authorities are determining the amount of the fine the business practices towards consumers on the taking stricter measures towards supervising body must always consider the internal market. In the middle of next year at nature of the unlawful action and the extent the latest, when the time allowed for the businessmen and their controls of its consequences. transposition of that directive into Czech are more and more intensive. The number of authorities entitled to legislation will have expired, Czech The most recent change as impose fines on businessmen for the violation businessmen can expect other explicit bans regards consumer protection was of consumer protection rules has also and restrictions of different business increased. They include the Czech Business practices. brought by the amendment of Inspection, the Czech Agriculture and Food The EU directive specifies nearly 30 the Consumer Protection Act of Inspection Authority, public health bodies, different business practices which must be 29 May 2006. The change was veterinary administration bodies and recently considered unfair under all circumstances. also trade licensing boards and customs This includes, for example, the ban on paid preceded, among other things, authorities, whose competence has been advertising in newspapers and TV, if the by the passage of a new act on significantly broadened. Besides imposing consumer cannot distinguish that it is an the enforcement of rights from fines, the officers of these bodies have far- advertisement, the ban to attach an invoice industrial property, which reaching competences in executing their or similar documents for making payments control powers: the right to enter the entire to marketing materials, whereby the became effective on 26 May and businessman’s facilities and buildings, request consumer may get the impression that he which unifies legal provisions the necessary documents and data from him, has already ordered the advertised product, scattered in a number of laws verify his identity, take samples against although this is not so. The directive also compensation, etc. makes it possible for the burden of proof into a single act. Another concerning allegations of fact used in certain amendment passed earlier this WRITTEN FORM BECOMES business practices to rest on the year is the amendment of the act OBLIGATORY businessman, in which case, unless the on the regulation of advertising. Other changes that have been made include businessman can prove the veracity of his the businessman’s duty to issue written allegations, those allegations will be What impact do these confirmation of his acceptance of the order, automatically considered incorrect. amendments have on Czech and which must be issued to the consumer in case foreign businessmen? the service is not provided while the customer ARE BUSINESSMEN waits. The confirmation must contain the THREATENED BY COLLECTIVE description of the object of service, its extent, ACTIONS OF CONSUMERS? quality, the price charged for providing the Collective actions to defend consumer service and the date when the service will be interests and other rights of citizens are not MORE INFORMATION: carried out. In case the customer lodges customary in the Czech Republic so far. The a claim, the businessman or another person suit by nearly three thousand Prague dwellers Sdružení obrany spotřebitelů (Consumers responsible for making the repair is also living by the noisy Prague trunk road against Defence Association of the Czech Republic) obliged to give to the consumer written the Prague Municipality, however, is www.spotrebitele.info/lang/ confirmation as to when the claim was confirmation of the changing trend, which is Česká obchodní inspekce (Czech Commercial lodged, what is its content, and which mode coming to us from the USA across the whole Inspection) www.coi.cz of settlement the customer requires, of Europe. Consumers are beginning to take including confirmation that the repair was the defence against unfair business practices Státní zemědělská a potravinářská inspekce carried out and how long it took, possibly in their own hands no longer relying on just (Czech Agriculture and Food Inspection a written explanation why the claim was state supervision. A welcome fact is that legal Authority) rejected. In case the businessman provides regulations are becoming more and more www.szpi.gov.cz services or sells products outside his registered favourably inclined to these suits. European Consumer Centre business facility, he is obliged to inform the The amendment of 29 May 2006 brought www.mpo.cz/cz/ochrana-spotrebitele/esc/ consumer in writing about the conditions of the consumer protection act in harmony with lodging a claim and with whom the claim the EU directive on this subject. Under this

| 12 CZECH BUSINESS AND TRADE

A number of changes have taken place in the Czech Republic recently in the area of consumer protection directive, a list is kept of persons entitled to recognize real collective, so called "class" of rights from industrial property, which file a suit in any EU member state against actions. The Consumers Defence Associations allows professional organisations operating in unlawful conduct in the area of consumer may file suits against unlawful conduct, but this area to file such suits. rights protection. According to the latest they have no right to bring action for the Commission report, altogether 272 such recovery of property obtained as a result of associations have been registered in the entire unjust enrichment, for adequate satisfaction Mojmír Ježek European Union, including 5 Czech ones. or the compensation of damage. An Attorney-at-law Czech legislation, however, does not exception is the new act on the enforcement (e-mail: [email protected])

CONSUMERS DEFENCE ASSOCIATION OF THE CZECH REPUBLIC The Consumers Defence Association (SOS) regards the newly implemented regulation on fraudulent business activities as very beneficial. We expect greater effectiveness of consumer rights as a result of this new legal amendment. These specific fraudulent business a ctivities which are newly implemented into Czech legal system were often ignored by relevant state authorities, or they were not sanctioned although consumer organisations regularly drew attention to them. Relevant state authorities, including prosecution authorities, could not rely on the effective legislation and many transgressions of consumer rights were not prosecuted. The newly passed European legislative thus opens up a new potential for consumer organisations in their field of activity and it will result in the growth of the level of consumer defence. As a member of the European Consumers’ Organisation we supported this directive. Consumer organisations have also been calling for legislative amendment of the so-called class-action lawsuits. The reason is the effectiveness of this useful instrument which lies in a more efficient prevention of violation of legal rights and indemnity. Currently the possibilities of class-action lawsuits are sometimes substituted by the so-called model lawsuits of individual subjects. Other participants’ further conduct is coordinated on the basis of the results of these lawsuits. Current legislation enables consumer organisations to sue entrepreneurs to refrain from illegal conduct; nevertheless this amendment does not fully correspond to the claims of the so-called class- action lawsuits. We do not want to sue only, though. That is why we try to oblige firms and entrepreneurs in their effort to me et the requirements of consumer defence. We offer companies regardless of their economic situation to participate in training in the p ractical use of consumer rights. We have also prepared an instrument for improvement – an audit of a firm’s trade conditions from the pers pective of effective rules for consumer protection. We also try to function as a mediator in disputes between entrepreneurs and consumer s. We want to help both parties to quickly and fairly solve the existing problem with which usually neither party wants to go to court. Several thousands of SOS members expect that they will be able to rely on legislation in the field of mediation which will allow for an effective involvement in consumer–entrepreneur disputes with the goal of a faster and cheaper solution. Mediation presupposes willingness of both sides to participate. It is often the offering side that lacks this willingness. Therefore we welcome ethical codex and other self-regulatory mechanisms of professional business unions. We see business unions as important participants and we have a useful dialogue with many of them. We regard contacts and consultation with the world of business as a challenge and an opportunity which will pay off to consumers and clients as well as to companies. David Šmejkal (e-mail: [email protected]) Photo: www.orangedisc.cz

13 | EXPORT

Examples of Successful Czech Exports

METROSTAV TO BUILD "In total, six different international that the underground road is accessible TUNNELS IN ICELAND consortia submitted their application even in periods of severe winter weather. Metrostav, a joint stock in the two-round tender process. Throughout the length of the bored The offer that we submitted in association tunnel segments, work will be carried out company, is to build two tunnels with construction company Háfell of in igneous rocks; unstable layers may only in Iceland of almost 11 km in Iceland best met the requirements of be expected in the excavated segments. total length and at a cost of ISK Vegager in, the investor (an institution The height of the overburden is relatively 5.7 billion. These tunnels are similar to the Road and Motorway high, up to 600 m in the section below the Directorate of the Czech Republic). We Hólsfjall peak. to link the towns of Siglufjördur were not only able to offer the best price For the implementation of projects, and Ólafsfjördur on the north but we also met other criteria, including Metrostav draws on its extensive coast, forming part of a new the construction deadlines and quality experience in underground work whilst segment of the island’s main guarantees," said Pavel Pilát, Metrostav’s employing advanced technologies, the Sales Director. undisputable benefits of which have arterial road.The significance Within the construction area, which convinced many domestic and of the project is also evidenced also includes a bridge over the international investors. In many cases, by the fact that four members Hé insfjar ará River and the total length Metrostav was the first to employ such of which amounts to 14.1 km, Metrostav technologies in the Czech Republic and of Iceland’s Parliament, three will build two segments of the tunnel, the first to use them to such a large ministers of Iceland’s partly bored, partly excavated, 10 995 extent. Government (the Minister of m in total length. The shorter one, Transport, the Minister of Health Siglufjördur, will be 3 871 m in length, and the other, Ólafsfjördur, will be 7 124 m long. For more information, see and the Minister of Social Entrances to the tunnels will be provided www.metrostav.cz Affairs). with protective concrete collars to ensure

ŠKODAEXPORT REALISES The project also THE LARGEST CZECH EXPORT includes the PROJECT IN HISTORY building of India is one of the high priority a power plant which will supply not only the regions of Czech export policy. port and the economic It is in this country that zone, but it will enable Škodaexport reaps great success. the sale of electricity to The company prepares the so far other Indian states. Finally the project also largest Czech project abroad of includes the India, an investment of one construction of billion dollars.The project is the a factory to produce modernisation of the port of artificial fertilisers. It is the largest export Nizapatman.In fact it is four project not only projects in one – it comprises regarding financial the modernisation of a port on extent, but also in its the eastern shore of India, in the contents. Škodaexport Škodaexport also built a power station in Ennore, India will build both the Bay of Bengal, in Andhra power plant for the Pradesh. port, the economic zone, and the needs of director Jaroslav Hubáček. Hubáček also says Andhra Pradesh as well as the factory that the so far largest Czech export project, producing artificial fertilisers virtually as in fact a "quadruple project", is also an a turn-key project. expression of the willingness of Andhra "The power plant is standard work Pradesh to cooperate with the Czech Škodaexport is used to. We work as a turn- Republic. The whole project was a subject of key supplier, of course in cooperation with negotiations during the prime minister Jiří Czech suppliers Škoda Power from Plzeň, Paroubek’s visit to India in January 2006. a producer of turbines and turbine- generator units, with ZVVZ Milevsko, Alstom . We might realise the traditional Czecho-Slovak cooperation in the field of For more information, see www.skodaexport.cz

supplying boilers," said the company’s Photo: Škodaexport

| 14 CZECH BUSINESS AND TRADE

New Ways Of "Changes" Are Popular Among Businessmen

With effect from 8 March 2006, SHARES DIRECTLY by joint liability of involved companies the commercial code codifies FOR PARTNERS which is, however, limited by the amount A significant new feature is the fact that of net business property as ascertained by new ways of splitting commercial or stock share of succession an expert's account in the succession commercial companies which no companies is not given to the company companies and by the amount of its own longer require unconditional that is being split, but directly to its capital as showed in the starting balance in elimination of the company that partners. This was not possible with the the company that is being split. current ways of splitting commercial The new legislation is achieving success is being split. For many years, companies. In accordance with this new among the Czech businessmen. Starting in legal experts and theory has legislation, partners of the company that is March, many companies made use of the been calling for this change that being split shall keep their share of the new ways of splitting off, including Česká company that is being split and shall also pojišťovna, Radiokomunikace, Group 4 would correspond to the so become partners in the succession Falck, and others. Potential ambiguity called sixth European regulation. companies. regarding the application of the new The commercial code now allows Determination of shares of the partners legislation cannot overshadow its clear to perform a split of of the company that is being split in the benefits for the Czech businessmen and succession company depends, according to foreign investors. a commercial company by the so the new legislation, entirely upon called "splitting off" by which negotiations between the partners. The the company that is being split commercial code accepts both a so called does not cease to exist and only equal exchange rate, which constitutes the Mojmír Ježek partners' right to identical shares, and a so Attorney-at-law

a part or parts of its assets are called unequal exchange rate, which allows (e-mail: [email protected]) Photo: www.orangedisc.cz transfered by the splitting to divide the succession process to one or more newly companies according to the needs of individual partners. created companies (so called In all cases, however, "splitting off with the creation a condition of suitability and of new companies"), or to an evincibility of even an unequal already existing company (so exchange rate must be met. called "splitting off by PROTECTION merging"). OF CREDITORS Commercial company split affects not only involved companies, but also every debtor and creditor of the company that is being split. For this reason, the commercial code expressly considers a situation in which it may not be, in a particular case, clear to third persons from a project or an agreement about a split, what obligations and claims were transferred from the company that is being split to the succession company. In this case, all debatable assets and obligations remain with the company that is being split. Should it not be clear what parts of the assets or obligations were transferred to succession companies, they become joint owners of the transferred assets and they shall share the transferred obligations one and all. Protection of creditors is – The Commercial Code Amendment gives greater protection to among other things – ensured creditors

15 | REGION

NUTS 3 –

TERRITORIAL DIVISION, LOCATION, POPULATION

The Pardubice Region is situated Pardubice in the eastern part of Bohemia, Ústí nad Orlicí and together with the Hradec Králové and Regions, forms a territorial cohesion unit called NUTS 2 – North-East. A section of the Region’s north- eastern border forms the Czech- Polish state border and from ECONOMIC another important sector, which accounted there on, the Region is fringed by CHARACTERISTICS for 5.8 % of the Region’s gross added value. the southern slopes of the The Pardubice Region can be characterised Farmland occupies 60.6 % of the Orlické Hory Mountains and the as an industrial and agricultural entity. Its Region’s total area, with forests covering industrial production has a diversified 29.4 % and water 1.35 %. Agriculture westernmost slopes of the Hrubý structure, with strong representation from focuses on vegetable production and the Jeseník range. The south and the general engineering and chemical production of milk, eggs, and meat. The south-east is bordered by the industries, followed by the textile, electrical Region also has deposits of gravel sand and hills of the Žďárské Vrchy and engineering and food industries, and brick clay. construction. Železné Hory Mountains. The In 2004, its per capita gross domestic TRANSPORT central and western parts of the product amounted to 60.4 % of the EU25 The most widely used modes of Region are formed by the fertile average. Five branches of industry are most transportation in the Pardubice Region are Labe basin, which has the Labe responsible for the creation of the road and railway transport. The Region has Region’s GDP, generating 71.8 % of its gross 531 km of railway lines, with Pardubice itself () River meandering through added value. Of decisive importance is the being one of the country’s most important it. The Orlické Hory, Žďárské manufacturing industry, which in 2004 railway junctions. It is part of the E040 Vrchy, and Železné Hory accounted for 33.3 % of the Region’s gross international railway line (Paris – Nuremberg added value. Other branches with high – Prague – Vienna) and the E061 (Berlin – Mountains belong to the proportions of the Region’s gross added Prague – Brno – Vienna) line. Important Region’s protected landscape value are trade (11.8 %) and public national lines in the direction of Liberec and areas (www.orlickehory.cz). transport, warehousing and communi- via Chrudim and to Havlíčkův Brod With its area of 4518 sq. km, the cations (10.6 %). Also important were are connected to the main corridor in activities in the area of real estate (9.2 %) Pardubice. Region occupies 5.7 % of the and construction (6.9 %). Agriculture is The most important road link is the I/37, country’s total area. Its population, living in four districts – Pardubice, Chrudim, Svitavy, and Ústí nad Orlicí –amounts to 506 000. The regional capital is the statutory town of Pardubice with a population of 88 200 (www.mesto-pardubice.cz).

Krajský úřad Pardubického kraje (Regional Office of the Pardubice Region) Komenského nám. 125 532 11 Pardubice Czech Republic phone: +420 026 111 fax: +420 466 220 e-mail: [email protected] www.pardubickykraj.cz

View of the historical part of Pardubice Photo: Evžen Báchor

| 16 CZECH BUSINESS AND TRADE

running from the North through Pardubice BRIEF CHARACTERISTICS OF THE REGION and Chrudim to Ždírec nad Doubravou, and NUTS Area (sq. km) Population Municipalities Population density I/17 in the direction of Čáslav via Heřmanův (persons/sq. km) Městec and Hrochův Týnec to Zámrsk. An intersection of important roads in the south- NUTS 4 – Chrudim 1 029 104 575 113 102 eastern part of the Region is located at NUTS 4 – Pardubice 889 160 931 115 181 Svitavy. From there, road I/35 runs to the NUTS 4 – Svitavy 1 335 101 827 113 76 North-West via Litomyšl, Vysoké Mýto, and NUTS 4 – Ústí nad Orlicí 1 265 138 691 111 110 Holice to Hradec Králové. A basic change in NUTS 3 – Pardubice Region 4 518 506 024 452 112 Pardubice Region’s road transport will be NUTS 1 – CR 78 868 10 251 079 6 248 130 the new section, now under construction, of the existing Prague – Poděbrady motorway, Source: Czech Statistical Office (as of 31 December 2005) to be linked to the R35 thoroughfare, which will become the backbone of the Region’s transport system. African Museum is a memorial to the Czech in Pardubice (www.vcd.cz). As regards In air transport, a decisive role is played by traveller Dr Emil Holub (www.holice.cz) sporting events, the best-known is the Pardubice international airport with The Pardubice Region is also a region of the Great Pardubice Steeplechase mixed military and civilian air traffic music. Its most renowned undertakings are (www.pardubice-racecourse.cz). A familiar (www.airport-pardubice.cz). the Pardubice Musical Spring and event for the lovers of motorcycle racing is As regards river transport, the Pardubice performances by the Pardubice Chamber the race for the "Golden Helmet of the Region can only use a short navigable Philharmonic Orchestra representing the Czech Republic". In many other sports, too, section of the Labe. A necessary condition Czech Republic in other countries on the Pardubice Region plays a distinguished for the realisation of a logistic port zone is various occasions. Other musical events are role. For example, the Pardubice extra- the canalisation of the 23 km Pardubice – Smetana’s Litomyšl and music festivals in league ice-hockey club has become section of the Labe. After that, Polička. Among the Region’s theatres, the a nursery for ice-hockey talents of world Pardubice will be directly connected, not most popular is the East Bohemian Theatre stature. only to the important sea port of Hamburg, but also to the whole network of European waterways (www.pristav-pardubice.cz). One Average gross monthly wages 200–2005 (EUR) Unemployment rate 2001–2005 (%) interesting tourist attraction is the regular Pardubice Region CR Pardubice Region CR 655 seasonal pleasure cruising programme down 700 602 641 583 12 9.81 10.31 9.47 % EUR 559 554 the Labe from Kunětice via Pardubice to 600 521 519 9.42 8.94 8.35 482 10 8.9 8.66 8.88 Přelouč. 500 449 7.93 8 400 EDUCATION, CULTURE, 300 6 TOURISM 200 4 There are 239 elementary schools in the 100 2 Region, and its 20 grammar schools provide 0 0 2001 2002 2003 2004 2005 secondary education for more than 7 200 2001 2002 2003 2004 2005 students. In addition, there are 42 secondary EUR exchange rate as of 31 December 2005 (EUR 1 = CZK 29) vocational schools, 32 secondary-level apprentice training centres and 11 higher- level vocational schools. Pardubice also has a university with four faculties BASIC DATA (www.upce.cz). The Pardubice Region has Area of the Region 4 518 sq. km good prerequisites for the development of Population 506 000 tourism. It has a beautiful environment, featuring vast planes alternating with Regional capital Pardubice mountain slopes, a favourable climate and Unemployment rate 8.6 % (February 2006) opportunities for swimming, water sports, Per capita GDP CZK 230 880 (EUR 770) (year 2004) hiking, cycling, and winter sports. Agro- tourism is developing in the Source: Czech Statistical Office mountain foothills throughout the Region, which is also traditionally known for breeding famous Kladruby horses UNEMPLOYMENT RATE BY DISTRICT (%) (www.nhkladruby.cz). Tourism is naturally Chrudim 8.3 linked with cultural activities. The Pardubice castle hosts expositions of the East Pardubice 6.7 Bohemian Museum and the East Bohemian Svitavy 12.3 Art Gallery (www.vcm.cz). Chrudim’s Ústí nad Orlicí 8.3 attraction is its well-known Puppet Museum (www.puppets.cz), and in Holice, the Source: Ministry of Labour and Social Affairs (as of 28 February 2006)

17 | REGION

The Pardubice Region Is Drawing on EU Funds

The Czech Republic’s accession to Among the most important projects that have provides the possibility of drawing much the European Union has opened been accepted as eligible for support from the higher sums from EU funds. In the framework Structural Funds, there are three involving the of the NUTS 2 North-East Regional Operating up possibilities to draw on modernisation of selected sections of 2nd and Programme alone, the Region will be able to important financial sources from 3rd class roads in the Pardubice Region. These draw more than CZK 700 million (approx. EUR EU Structural Funds and entities projects will receive a subsidy from the 23 million) a year. Currently the Pardubice Structural Funds to the amount of approx. Region is intensively preparing for this throughout the Pardubice Region CZK 145 million (approx. EUR 5 million). possibility. It necessitates an active approach to are drawing considerable benefit A project for the construction of preparing the operating programmes and from this opportunity. a multifunctional education, community, and the preparation and realisation of cultural centre in Svitavy is to be supported a comprehensive information system to make with approx. CZK 90 million (EUR 3 million) all those interested broadly informed of the from the Structural Funds and a project for possibilities of drawing money from the Active Tourism in the Orlicko-Třebovsko area Pardubice Region Structural Funds and to help will receive a subsidy from the Structural Funds potential applicants to prepare their projects. of approximately CZK 55 million (EUR 1.8 The Pardubice Region is fully aware of this million). The Pardubice Region has already unique opportunity and wants to take full taken the opportunity of drawing money from advantage of it. In my opinion, the possibility EU pre-accession funds, e.g. for the of using the money during the seven-year modernisation of railway corridors on the period provides a tremendous opportunity for territory of the Pardubice Region with the development of our region. At the same a subsidy of approx. CZK 1.2 billion (approx. time, in my position as the main negotiator EUR 40 million) and for the modernisation of with Brussels for the conditions for the roads in the border areas of the Pardubice Regional Operational Programme for all three Region, specifically in the Ústí nad Orlicí regions, I am feeling great responsibility for District with a subsidy of approx. CZK 90 the successful realisation of the programme. million (approx. EUR 3 million). In sum, it can I am sure that most citizens in our region will be said that the Pardubice Region has received benefit from being able to use the funds that or will receive financial means from the are made available to us. European Union to the amount of approx. CZK 2.5 billion (approx. EUR 83 million). Roman Línek The new 2007-2013 EU planning period Vice-President of the Pardubice Region

Electrotechnical Cluster of the Pardubice Region

The Pardubice Region supports the idea of were organised during the screening project The electrical engineering creating clusters in the Region. It therefore in order to discuss topics such as the future has appointed the Pardubice Regional cooperation within the cluster, its industry has a long tradition in Development Agency to draft a project organisational configuration etc. Members the Pardubice Region. It was known as "Searching for Companies of the cluster agreed upon possible established at the beginning of Suitable for the Creation of an cooperation in areas such as employees’ the 20th century and it has Electrotechnical Cluster in the Pardubice education, marketing, advertisement, Region". The project is supported by the common research and development, etc. survived until recently despite the programme CLUSTERS (Operational Educational and scientific-research economic and political changes Programme Industry and Entreprise). institutions are also an imminent part of the after the Second World War and The project has been completed by the cluster. Pardubice University, as represented end of July and its conclusion includes by the Institute of Electrical Technologies, after 1989. This is one of the a recommendation for the establishment of the Secondary Vocational School of Electrical reasons why the electrical the cluster. Within the Pardubice Region, Engineering, and Pardubice currently engineering industry was selected about 17 companies have already promised cooperate on the project. as a sector with a high potential to participate, including small and medium- sized enterprises (for example CESA a. s., for the creation of a cooperation RCD Radiokomunikace s. r. o., Radom s. r. o., More information at: structure, the so-called cluster. Bohemiatech s. r. o. etc.) and large www.elektroklastr.cz companies (KIEKERT-CS). Five workshops

| 18 CZECH BUSINESS AND TRADE

Agency Serving the Region, Businessmen, and Investors

The Regional Development The Agency’s other concern is helping East Region in Brussels last year, where Agency of the Pardubice Region commercial entities, for whom several successful projects co-financed from EU successful projects have been prepared, one funds in the area of transport, tourism, (RDA PR), pursuing its activities great example for all: a project supported by education, investment, innovation, and in the Pardubice Region for the Operational Programme Industry and environment – all implemented in the NUTS 2 seven years was established Enterprise – Properties, that is also taken by North-East Region – were presented to the implementation agency CzechInvest as representatives of European institutions and in 1999 as a non-governmental, the sample project; other successfully Belgian business companies. non-political, and independent developing project is the Electrocluster This year, the Regional Development association of legal entities project that supports electro technical Agency and its Euro Info Centre are After the Czech Republic joined sector. preparing the presentation of the Pardubice Regarding cross-border co-operation, Region for the important "Open Days", the EU, the Agency began a project successfully completed under the conferences held in Brussels in October to occupy itself with the INTERREG IIIA initiative focused on 2006. The Euro Info Centre East Bohemia Structural Funds of the modernising the road in the area of Červeny informs small and medium-sized European Union and the Potok–Upper River. In the enterprisers and businesses about EU framework of trans-national co-operation legislation, new regulations and in general financial mechanism of the of countries in the CADSES-INTERREG IIIB about the effects of the Czech Republic’s European Economic Area (EEA) area, the Agency prepared the project accession to the EU on business. The Euro and Norway, the so-called concentrating on innovative flood risk Info Centre also helps businesses with management now being completed, which establishing commercial and industrial co- Norwegian Funds. has been evaluated very well. Another operation abroad through its Business Co- In 2005, the Agency prepared Interreg project that has been realised is the operation Database so that all co-operation 28 projects. Among the most project focusing on inter-regional co- ventures are co-ordinated in a systematic important projects in the operation in agricultural sector – eFarmer way and made more efficient. (INTERREG IIIC). The Regional Development Agency of framework of the Joint the Pardubice Region is a member of the Regional Operating Programme SERVICES FOR Czech Association of Development are those projects covering the BUSINESSMEN AND INVESTORS Agencies (ČARA) and on the level of the area of transport infrastructure, The Agency provides information about Pardubice Region it represents the AIP investment opportunities in the Pardubice Innovation Enterprise Association. It co- human resources development, Region and about investment incentives, operates closely with the CzechInvest social integration in regions, and organises educational seminars. The Agency in the sphere of attracting foreign development Agency also prepares the "Regional investments into the country and provides Development Programme" and selected information about investment of tourism, and ecology projects concerning the development of the opportunities, industrial zones, and and nature protection. Pardubice Region. Going with it are brownfields in different localities. It helps to specialised services facilitating realise investment projects of foreign or communication with the EU administration. domestic investors and promotes Furthermore, the Agency prepares strategic investment and entrepreneurial activities in plans for the town and community the Region. associations development. Naturally, it represents the Region at exhibitions and Hana Pindurová conferences concerning tourism, Consultant, RDA PR and Euro Info Centre investment, enterprise, and innovation. One Pardubice of the most important events of this kind (e-mail: [email protected]) was the presentation of the NUTS 2 North- www.rrapk.cz

PROJECT FOR THE SUPPORT OF BUSINESS DEVELOPMENT

The Regional Economic Chamber of the Pardubice Region was established as an independent subject three years ago, when the district economic chambers of Pardubice, Chrudim, and Orlicko were merged. Apart from its seat in Pardubice, the Chamber also has its local offices in Česká Třebová and in Chrudim. The Chamber provides high quality services, which can be demonstrated for example by the fact that it was awarded the ČSN EN ISO 9001:2001 in 2003 for the following field of activity: Support of Business Activities and the Provision of Services to Business People. The task of the Chamber is to support business development and to stand for the interests of business people, as well as to provide related services. The Chamber successfully cooperates with the Regional Development Agency and it participates on the creation of the Regional Development Plan, with the Pardubice Region and Pardubice University as their partners.

More information at: www.khkpce.cz

19 | REGION

Agrarian Region Grown into a Tiger

PARDUBICE INDUSTRIAL smaller investors or start-up units. Even though the Region of ZONE Another developing project in the Many big investors have chosen the industrial zone is the construction of Pardubice is one of the smallest Pardubice industrial zone (710 000 a science and technology park; the so regions and a large part of it square metres) to be the place of their called TechnoPark Pardubice. It is reaches into the agricultural business. Alocal master plan hassponsored by the , Vysočina, it has become the third provisions for the expansion of the the Pardubice Region, and Free Zone industrial zone up to 1.2 square km. The Pardubice Company. In the future, the strongest exporter in the Czech site is intended for light industrial Technopark should become a centre of Republic. Investors, promising manufacture, manufacture and strategic strategic services, development, and more opportunities for smaller services, or technology centres. Currently research. Cooperation with the University suppliers, keep on coming. This is there are companies that supply and secondary schools from the town components for the automotive industry, that contribute expertise so as to expand helped by the industrial zones eg. Panasonic Automotive Systems the number of professionals in the present in the Region. Czech, JTEKT Automotive Czech electrical, chemical, and engineering Pardubice, Ronal CR, and Kyb industries is yet another plus for Manufacturing Czech. Among newly businessmen – there is no great shortage planned investments for the industrial of qualified workers in Pardubice. zone, there is a developer project by CTP Pardubice offers its industrial zone to Invest Company called CTPark Pardubice, investors mainly through CzechInvest – whose intention is to build rental halls for State Investment and Business Development Agency. In 2002, the zone was the only one awarded by CzechInvest for its complex readiness, and in the following two years it finished second in the category called "Zone with the Greatest Economic Benefit".

FORMER MILITARY ZONE Possibilities for investment in Pardubice are by no means limited to the industrial zone. There are large sites right in the city offering good prospects for investments in commerce and the entertainment industry. A10 hectare area of former military barracks that will be modernised by the Pardubice town hall is an excellent offer for investors. This area should be earmarked for housing, administrative and commercial purposes, or sports and culture.

More at: www.mmp.cz/en/industry_and_business/ investment_opportunities/zone/

Pardubice industrial zone

AREAS AVAILABLE TO INVESTORS Name District Area (ha/sq. m) Usage Contact Chrudim Chrudim 73/730 000 industry Ladislav Libý Phone: +420 469 645 239 Lanškroun Ústí nad Orlicí 4/40 000 light industry Ladislav Urban Phone: +420 465 385 238 Ústí nad Orlicí 7.76/77 600 light industry Vlastimil Mlynář Phone: +420 465 676 426 Litomyšl Svitavy 10/100 000 industry Pavel Chadima Phone: +420 461 653 370 Pardubice Pardubice 75/750 000 light industry Hana Svobodová Phone: +420 466 859 463 Ústí nad Orlicí Ústí nad Orlicí 27.2 /272 000 light industry Přemysl Šťovíček Phone: +420 465 514 249 Vysoké Mýto Ústí nad Orlicí 38.55/385 500 light and medium industry Oldřich Pavelka Phone: +420 465 466 151

Water, gas, drainage, electricity, and telecommunication networks available in all areas. Photo: archive

| 20 CZECH BUSINESS AND TRADE

Promoting the Competitiveness of Pardubice Companies

The subsidies will serve, for example, for the wide patent. Hyodin is an original The main purpose of the purchase of machinery and equipment, preparation used for healing wounds, which reconstruction and technical improvement was developed by the institute itself in co- enterprise promotion system in of long-term tangible assets or the coverage operation with Hradec Králové University the Czech Republic is to raise the of publicity costs. Financial support under Hospital. It is one of the most unique competitiveness of industry and the programme of from three to twenty-five projects supported under the Innovation the country’s entire business million crowns (approx. from EUR 100 000 programme. to EUR 830 000) was available to firms "A significant potential of projects in environment. Support regardless of their size. The maximum forward-looking branches is building in the programmes in the framework amount of the subsidy was 46 % of Pardubice Region, where projects resulting of the Operational Programme recognisable project costs. in highly competitive products on the international scale have been supported Industry and Enterprise SPECIAL REGARD under the Innovation Programme. In administered by the Ministry TO PHARMACY addition, linking up with these projects, of Industry and Trade and One of the largest projects covered by the a cluster is developing in the Pardubice CzechInvest are intended Innovation Programme was the construction Region focused on the application of of a new plant for the manufacture of oxy- nanotechnologies in medicine and primarily for forward-looking cellulose at Synthesia Pardubice. The whole pharmacy", Jan Vanýsek, Project Manager of firms with growth potential, firms project will cost more than CZK 150 million CzechInvest’s Pardubice regional office intending to invest in their (approx. EUR 5 million), one-third of which pointed out. development. was gained by the firm in the form of subsidy. The new plant will be making EXPORTS FROM THE Thanks to the Innovation oxygenated cellulose derivatives, which, PARDUBICE REGION Programme, which is its part, because of their astringent bactericidal and The share of the Pardubice Region in overall enterprises had an opportunity healing effects, have a wide use in medicine, Czech exports stands at 7.6% (CZK 142 674 pharmacy, cosmetics, and the food industry. million – approximately EUR 4 759 million), to receive support for the The technologies required for this purpose which is a value that is close to the Czech realisation of projects aimed were developed in co-operation with the average. The Region’s exports per one at raising the technical Pardubice University and the Organic inhabitant is CZK 282 200 (approximately EUR and use value of their products, Syntheses Research Institute. 9 407), which is over average (4th place in the Under the same programme, support was Czech Republic). technologies, and services given to the CPN project – Hyaluronan or the introduction of advanced production by extraction and Hyodin More at www.czechinvest.cz methods of management and preparation, which is covered by a world- other non-technical innovations. MAIN EXPORT ITEMS ACCORDING TO SITC, REV. 3 OF THE PARDUBICE REGION (SHARES IN %) 752 Devices for automated data processing 42.0 764 Telecommunication devices and accessories, TV accessories 4.1 778 Electrical devices (batteries, bulbs) 3.9 759 Parts etc. for office machines and automated data processing 3.6 728 Machines and equipment for particular industrial branches 3.3 783 Road motor vehicles (for public transport), tractors 3.2 784 Parts and accessories for motor vehicles 2.6 776 Electron tubes, ray tubes, diodes, transistors etc. 2.4 772 Electrical devices for switching of circumferences 2.3 762 Radios, combined receivers 1.9

OTHER INDUSTRIAL ZONES IN THE PARDUBICE REGION: Chrudim – Industrial zone - www.chrudim-city.cz, e-mail: [email protected] Lanškroun – Industrial zone – West – www.mesto-lanskroun.cz, e-mail: [email protected] Industrial zone – Letohrad – www.letohrad.cz, e-mail: [email protected] Litomyšl – Industrial zone Benátská, www.litomysl.cz, e-mail: [email protected] Moravská Třebová - Industrial zone, www.mtrebova.cz, e-mail: [email protected] Přelouč – Industrial zone, www.mestoprelouc.cz, e-mail: [email protected] Industrial zone - – www.ronovnd.cz, e-mail: [email protected] Svitavy – Industrial zone "Paprsek" - www.svitavy.cz/inv/paprsek.htm, e-mail: [email protected] Industrial zone Třemošnice – www.tremosnice.cz, e-mail: [email protected] Ústí nad Orlicí – Industrial zone "Hylváty", www.ustinadorlici.cz , e-mail: [email protected] Industrial zone Vysoké Mýto, www.vysoke-myto.cz, e-mail: [email protected]

21 | REGION

Expansion of the Kiekert Concern

Kiekert – CS, s. r. o. is The company selected the Czech Republic competition tougher. Therefore, the Czech a subsidiary of the German as the place for its crucial expansion subsidiary is of utmost importance to us, as because it could offer a sufficient number we need it in order to sustain our position concern Kiekert AG, the world of qualified workers, especially in the area and competitiveness in the world largest producer of car of mechatronics. markets", said Wolfgang Theis, Chairman accessories with its seat in The installation and completion of of the Board at Kiekert. Such expansion is central car locks is the most important part the best reference for all potential Heiligenhaus near Düsseldorf. Its of the company’s activities. Locks that investors that are considering investing in most important customers are combine both mechanical and electrical the Czech Republic. car factories such as Volkswagen, control functions are the most modern products produced by Kikert-CS. Peugeot, General Motors, More information at: www.kiekert.cz "The world becomes more global and Mercedes, Opel, Seat, Saab, Škoda, Renault, and others. In 2005, the investor decided to RESEARCH AND COMPUTERS FIRST AND FOREMOST double its production capacities According to CzechInvest, the Pardubice Region offers the best opportunities especially for in the Czech Republic by building research and IT companies, biomedicine, pharmacy, and the creation of technological a new production plant in centres. "The influx of investors should continue for a few years. Their structure, however, will change, as more companies with higher added value linked with companies already Přelouč. This plant offered 1 100 existing in the area are coming", said Tomáš Vaníček, Director of the Pardubice Office of new jobs. The investment of CZK the CzechInvest Agency. The town of Pardubice with companies like Foxconn 300 million (approximately EUR (www.foxconn.cz) and Panasonic (www.panasonic.cz) is the best example of such 10 million) was completed within a background. Recently, the company Ronal (www.ronal.cz) also came to this town. The Kayaba Company (www.kyb.co.jp), along with several developers offering plants for lease one year and production is and producers of car components will fill the remaining areas in the Pardubice zone. currently (July 2006) being Pardubice has therefore already started, apart from the tradition of chemical and electrical launched. industries, to take advantage of the vicinity of the TPCA car factory. More information at: [email protected]

Development – Production – Trade

The company was originally concentrated success can be The three above words on products for foreign customers, but this attributed, above production has recently been replaced by all, to the characterise SAM Trade a. s. and the production of their own models that development its subsidiary SAM Shoes s. r. o. now make for up to 25 % of the group that The company focuses on the company’s sales. prepares models production of working, safety, The company is especially successful in at least one year the production of certified firefighters’ in advance, in and special shoes and its shoes that find their customers among reaction to production has been growing professional and voluntary firemen in the customers’ annually up to the current 80 Czech Republic as well as in Germany, needs. In order Poland, Austria, Slovenia, Croatia, Israel, as to resist the 000 pairs of shoes, produced by well as in other countries. Thanks to this, still the company each year. the company expects sales of these shoes to double in comparison to the previous year.

DEVELOPMENT INTEGRAL The above-mentioned Photo: SAM Trade

| 22 CZECH BUSINESS AND TRADE

growing pressure of Asian production, the produced more than 500 000 pairs of Medical Faculty and its group – when preparing new models – shoes since that year. Diabetes Department. The Ministry of dedicates a lot of attention to the The company also dedicates a lot of Industry and Trade awarded this project production of shoes featuring high added attention to the application of new and provided it with a grant. value, which increases their knowledge from the area of health care. In Trade is also an imminent part of the comfortableness and usefulness. The reaction to the progressively growing company’s activities. The company sells its company’s management tries to sustain numbers of patients with diabetes around own products above all through direct high production effectiveness and to apply the world, the company has drafted sales to production factories and it mainly new technologies and production a project focusing on the research, cooperates with the Safety technicians of methods. The license for the development, and production of work, these factories. manufacturing of Gore-Tex materials that safety shoes for patients with diabetes. was granted to the company in 1996 can The company is cooperating on this project More information at: www.samtrade.cz serve as an example, as the company has with the Second Internal Clinic of the

50 Years of Tradition – The University of Pardubice

Its eight thousand The University of Pardubice was students place it among the medium-sized public originally founded as the universities in the Czech Pardubice College of Chemistry Republic. There are five and later transformed into the faculties for the students Pardubice College of Chemistry to choose from and two university institutions: and Technology. With the creation Faculty of Chemical of other departments and Technology, Faculty of colleges after 1990, the school Economics and Administration, Jan structure has been changed from Perner Transport Faculty, a single college school with Faculty of Arts, Faculty of a focus on chemistry into an Restoration, Institute of institution providing higher Health Studies, and Institute of Electrical university education. Since 1994 Engineering and it has been known under its Informatics. current title: the University of Pardubice. INTERNATIONAL Universities participate in international projects PROJECTS, The University's educational, RESEARCH ACTIVITIES international projects. Within the scope of scientific, research, development, Besides education, the University boasts agreements with international partners and other activities are being rich scientific and research activities and research and university institutions, through which its faculties have gained the international cooperation takes place in cultivated towards the European respect of both domestic and international the form of student and teacher mobility, Higher Education Area and scientific public. This is also aided by the exchange of experiences, the solving European Research Area. several specialised sites and other a of number of scientific-research tasks, organisations, institutions, and groups that and organisation of important work with the University of Pardubice. An international meetings of professionals at important part in supporting educational, conferences and seminars. study, and scientific activities is played by the Endowment Fund of Miroslav Jureček and the Endowment Fund of Jan Perner. More at: www.upce.cz/english

University workshops participate in Photo: The University of Pardubice

23 | REGION

Pardubice

industry. The majority of big firms are BRIEF STATISTICS based in the town, mostly on its outskirts Magistrát města Pardubic Indicator District Region (Pardubice City Hall) within the developing industrial zones. Area (in sq. km) 889 4518 Perštýnské nám. 1 Over the long term, the dominant Population 160 931 506 024 530 21 Pardubice branches have been the chemical and Czech Republic petrochemical industries, engineering, and Inhabitants/sq. km 181 112 Phone: +420 466 859 111 the food industry with traditional Average gross Fax: +420 466 859 436 gingerbread production. Electricity monthly wage (in EUR) 636 583 e-mail:[email protected] production is secured by the only two Unemployment rate (%) 6.70 8.35 www.město-pardubice.cz thermal power stations in the Region – at Source: Czech Statistical Office (as of (www.eop.cz) and 31 December 2005) Note: EUR 1 = CZK 29 (as of 31 December 2005) Chvaletice (www.cez.cz). Electronic and electrical industries have been developing The District of Pardubice is situated in the in the recent years thanks to the provides education in a wide range of western part of the Pardubice Region. The contribution of foreign investors. The large specialisations. Prominent features of the area of the fertile Elbe lowlands spreading construction companies were divided into cultural scene include the East Bohemian over 889 sq. km is home to almost 32 % smaller units after 1989. A relatively good Theatre and the Chamber Philharmonic. of the Region’s population. The settlement climate and soil composition offer An area attracting many visitors is the spa structure is formed by 115 municipalities, 7 favourable conditions for agriculture. Crop town of Lázně Bohdaneč of them towns. The administrative, production is represented by grain, beet, (www.laznebohdanec. cz). cultural, and social centre of both the fodder, oil seed, and vegetables. Meat, Through the town of Pardubice the Region and the District is the statutory city milk, and egg production prevail in animal District participates in activities within the of Pardubice, with 88 200 inhabitants farming. Euroregion Glacensis (www.euro- (www.mesto-pardubice.cz). Thanks especially to the regional capital, glacensis.cz). This grouping of Czech and From an economic viewpoint, the the Pardubice District is a major centre of Polish municipalities supports cross-border District is an area with strong industrial education, cultural and social life, as well co-operation in economics, trade, production, concentrated mostly in towns, as sport. The University of Pardubice environmental care, infrastructure with the regional capital of Pardubice (www.upce.cz), established in 1994, enrols creation, and also plays an important role being the most important centre of both Czech and foreign students and in the promotion of tourism.

SELECTED FIRMS Name Based in Sector Contact Aliachem, a.s. Pardubice chemical industry www.synthesia.cz Paramo, a.s. Pardubice chemical industry www.paramo.cz 2VV,s.r.o. Pardubice air handling technology www.2vv.cz Cesa, a.s. Pardubice electronics, communication systems www.cesa.cz Awos, s.r.o. Pardubice electronics www.awos.cz Bet Systém, s.r.o. Pardubice wall insulation systems www.betsystem.cz Tvar, v.d. Pardubice protection helmets www.tvar.cz/prilby Léčebné lázně Bohdaneč, a.s. Lázně Bohdaneč spa care www.laznebohdanec.cz Agrostav Pardubice, a.s. Pardubice building www.agrostav-pce.cz Uniplast Pardubice, s.r.o. Pardubice plastic mouldings www.uniplast.cz Elplast, s.r.o. Přelouč manufacture of moulds and plastic mouldings www.elplast.cz Explosia, a.s. Pardubice explosives www.explosia.cz Tritón Pardubice, s.r.o. Pardubice electrical equipment www.triton.cz Bohemiatech, s.r.o. Pardubice printed circuits www.bohemiatech.cz Elmet, spol.s r.o. Přelouč electronics www.elmet.cz Prokop Invest, a.s. Pardubice engineering www.prokop.cz

FOREIGN INVESTORS Investor Country of origin Czech partner Sector Contact Kiekert GmbH & Co. Germany Kiekert-CS, s.r.o. car industry www.kiekert.cz Foxconn Holdings B.V. Netherlands Foxconn CZ, s.r.o. electrical equipment www.foxconn.cz Nedcon Groep N.V. Netherlands Nedcon Bohemia, s.r.o. racking and www.nedcon.com construction systems Eiba Betriebsanlagen GmbH Germany Eichenauer, s.r.o electrical equipment www.eichenauer.de Matsushita Electric Japan Panasonic Automotive electronic industry www.panasonic.cz Industrial Co., Ltd Systems Czech,s.r.o. Kayaba Industry Corp. Japan KYB Manufacturing Czech, s.r.o. car industry www.cyb.co.jp Realtime Technologies Limited Ireland Realtime Technologies, s.r.o. electronic industry www.realtimetechnologies.com

| 24 CZECH BUSINESS AND TRADE

Pardubice – A Town of Opportunities

The regional town of Pardubice Pardubice is easily accessible. It is completely prepared for investment and is one of the largest of the East a part of the Berlin – Prague – Vienna the possibility of utilising the foreign trade high speed railway corridor. Prague is zone (more about the industrial zone and Bohemian towns. It is its about 100 km away and it is therefore investment opportunities in a separate industrial centre and a traffic possible to reach the capital in almost an article on page 20). crossroads of European import. It hour by train. An important asset is the We should not forget to mention the presence of an international airport with industrial companies with firm roots in is also often called the town of mixed traffic. The civilian airport is Pardubice that have built a good name for horses (every year the Great operated by the town company East themselves. These include, for example, Pardubice Steeplechase is held Bohemian Airport and it is already clearing the chemical company of world renown – here,an important part of a large number of passenger, charter, and Synthesia, mineral oil refinery Paramo, or cargo flights. More than 50 thousand the Taiwanese company Foxconn, which international competitions), passengers checked in at Pardubice last has become Europe's greatest producer of gingerbread (Pardubice is linked year and the traffic and capacity are computers. to the traditional making of this increasing year by year. After completion To the town's advantage is also the fact delicacy,which is commemorated of a new terminal, the airport’s capacity that local educational institutions are ready will increase severalfold, estimated up to for teaching foreign languages – from by the Museum of Gingerbread hundreds of thousands of passengers per UNESCO certified grammar schools to the and Gingerbread Festivities), year. Road traffic will be boosted shortly by University of Pardubice. The town is also culture,and greenery. Surveys a strategically important traffic artery – the home to the following foreign institutions: Pardubice Region D11 highway, which will The British Centre, Alliance Francaise, and from recent years show that circle the town. Pardubice lies on the Labe Goethe Institut. people enjoy living in Pardubice. River and in the coming years a river port, According to sociologists, primarily for freight transport, should Pardubice tops the list of finally be built near the industrial zone. Many big investors have chosen the favourite towns in the Czech Pardubice industrial zone to be their place Republic. Investors are also of business. Apart from the above- Alexandra Tušlová satisfied because of the quality mentioned transport accessibility, there are Pardubice City Hall tradition of the chemical and the advantages connected with an area www.mesto-pardubice.cz electrical industries and the

newly emergent automotive Photo: archives industry. There are branches of important domestic banks and insurance companies; for many of them,Pardubice has become their hometown.

View of Pardubice

25 | REGION

Chrudim District Chrudim

District is an industrial and agricultural BRIEF STATISTICS area. The industry, however, is not one- Městský úřad Chrudim Indicator District Region (Chrudim Municipal Office) sided, as the structure of the sectors is Area (in sq. km) 1 029 4 518 Resselovo nám. 77 quite varied. Major industrial centres Population 104 575 506 024 537 16 Chrudim include Chrudim (engineering, food and Czech Republic textile industries), Hlinsko (electrical, fur, Inhabitants/sq. km 102 112 Phone.:+420 469 645 111 and food industries), Skuteč (leather and Average gross monthly Fax: +420 469 622 013 textile industries), (textile wage (in EUR) 553 583 e-mail: [email protected] industry), (building materials), Unemployment rate (%) 7.99 8.35 www.chrudim-city.cz Třemošnice (engineering), (food Source: Czech Statistical Office (as of and wood-working industries), Hrochův 31 December 2005) Note: EUR 1 = CZK 29 (as of 31 December 2005) Týnec (sugar production, building The District is situated in the south- materials). Thanks to the development of western part of the Pardubice Region - its small private firms the number of people 104 575 inhabitants live in 113 employed in the building industry is southern part, which has characteristics of municipalities, 8 of which have the status increasing. Crop production in agriculture, a foothill area, the soil is suitable for of town. The centre of the District is the especially in the northern part of the growing potatoes, flax, and less sensitive town of Chrudim (www.chrudim-city.cz), District (the Labe lowlands), is focused on grains. Animal farming is dominated by the with 24 180 inhabitants. grain and sugar beet. The heart of the production of milk, beef and pork, and From an economic viewpoint, is a potato growing area, in the eggs.

Nové Hrady Rococo chateau, also referred to as "Little Schönbrunn" or "Bohemian Versailles"

SELECTED FIRMS Name Based in Sector Contact Botas, a.s. Skuteč footwear industry www.botas.cz Dako CZ, a.s. Třemošnice engineering www.dako-cz.cz ETA, a.s. Hlinsko electrical appliances www.eta.cz První stavební Chrudim, a.s. Chrudim building industry www.psch.cz Technolen technický textil a. s. Hlinsko textile industry www.technolen.cz TMT, s.r.o. Chrudim Chrudim engineering www.tmt.cz Kovolis Hedvikov, a.s. Třemošnice foundry industry www.kovolis-hedvikov.cz Samas ČR, s.r.o. furniture manufacture www.samas.cz TMT, s.r.o. Chrudim technological transport units www.tmt.cz Samtrade, a.s. Skuteč protective footwear www.samtrade.cz

FOREIGN INVESTORS Investor Country of origin Czech partner Sector Contact Holcim Auslandbeteiligungs GmbH Germany Holcim ČR, a.s. cement production www.holcim.cz Mehler Aktiengesellschaft Germany Technolen technický textil, a.s. textile manufacture www.technolen.cz Liechtex Establishment Liechtenstein Komutex, spol. s r. o. electric motors, generators www.komutex.cz Groupe Electropoli S.A. France Electropoli-Galva, s.r.o. metal galvanisation www.electropoli.com Photo: CzechTourism

| 26 REGION

Svitavy District Svitavy

accounted for by food and textile plants, while BRIEF STATISTICS the share of glass fibre manufacture has been Městský úřad Svitavy Indicator District Region (Svitavy Municipal Office) growing. Also notable is metal production, engineering, and the manufacture of transport Area (in sq. km) 1 335 4 518 T.G.Masaryka 25/35 means, including accessories. Less extensive Population 101 827 506 024 568 02 Svitavy manufacturing includes wood products, printing, Inhabitants/sq. km) 76 112 Czech Republic refractory materials, ready-made clothing and Average gross monthly Phone:+420 461 550 211 special footwear. The biggest investments in Fax: +420 461 532 141 industry were represented by the operations of wage (in EUR) 550 583 e-mail:[email protected] foreign investors, "greenfield" projects were Unemployment rate (%) 11.75 8.35 www.svitavy.cz realised by the firms Westvaco in Svitavy, Rehau in Source: Czech Statistical Office (as of Moravská Třebová, Ravensburger in Polička, and 31 December 2005) ASCI in Jevíčko. Note: EUR 1 = CZK 29 (as of 31 December 2005) The District‘s production characteristics are SELECTED FIRMS mixed. The share of farming in the regional Name Based in Sector Contact output is higher than the share of industry. Hedva, a. s. Moravská Třebová textile industry www.hedva.cz Agricultural production is traditionally ZŘUD - Masokombinát Polička, a.s. Kamenec u Poličky food industry www.mkp.cz represented by grain and potato farming. Industry in the District is not one-sided, the Poličské strojírny, a. s. Polička engineering www.pos.cz structure of the sectors is quite varied. In previous TOS Svitavy, a. s. Svitavy engineering www.tos.cz years, the decisive volumes of production were Svitap J. H. J., s. r. o. Svitavy textile industry www.svitap.cz FOREIGN INVESTORS Investor Country of origin Czech partner Sector Contact Saint-Gobain France Saint-Gobain Vertex, a. s. glass fibres www.vertex.cz Meadwestvaco Spain S.L. USA Westvaco Svitavy, s.r. o. paper industry, packaging www.meadwestvaco.cz Gillette Eastern Europe Inc. USA Gillette Czech, s. r. o. consumer goods www.gillette.cz ASCI Holdings Czech (DE), Inc. USA Automative Safety Components car industry www.scieurope.cz International, s. r. o.

Ústí nad Orlicí Ústí nad Orlicí District

The District’s territory includes 10 relatively Městský úřad Ústí nad Orlicí small towns, the largest among them is Česká BRIEF STATISTICS (Ústí nad Orlicí Municipal Office) Třebová (www.ceskatrebova.cz) with 16 800 Indicator District Region Sychrova 16 inhabitants and Ústí nad Orlicí with 15 300 Area (in sq. km) 1 265 4 518 inhabitants, the administrative centre of the 562 24 Ústí nad Orlicí Population 138 691 506 024 District (www.ustinadorlici.cz). In previous Czech Republic years the largest production volumes have Inhabitants/sq. km 110 112 Phone: +420 465 523 035 been recorded by the electrical industry, the Average gross monthly Fax: +420 465 525 563 textile and clothing industries, and the wage (in EUR) 557 583 e-mail: [email protected] manufacture of machinery and equipment. Unemployment rate (%) 8.06 8.35 www.ustinadorlici.cz The importance of textiles has fallen lately, Source: Czech Statistical Office (as of but the electrical 31 December 2005) SELECTED FIRMS equipment share Note: EUR 1 = CZK 29 (as of 31 December 2005) Name Based in Sector Contact continues to rise on Korado, a.s. Česká radiators www.korado.cz the other hand. Třebová Forez, s.r.o. Ostrov metal www.forez.cz u Lanškrouna production FOREIGN INVESTORS OEZ, s.r.o. Letohrad electrical www.oez.cz Investor Country of origin Czech partner Sector Contact equipment Rieter Switzerland Rieter car industry, www. Isolit -Bravo, s.r.o. Jablonné electrical www. Holding CZ, a.s. engineering rieter.com nad Orlicí appliances isolit-bravo.cz AVX Limited United AVX Czech electronics www. Formplast Jablonné plastic www. Kingdom Republic, s.r.o. avxcorp.com Purkert s.r.o. nad Orlicí injection formplast.cz Karosa, a.s. Vysoké Mýto buses www.karosa.cz Schott Germany Schott Electronic electrical www. Lux, s.r.o. Jablonné machinery www.lux.cz Electronic Packaging, s.r.o. equipment schott.com nad Orlicí and equipment Int.H.GmbH Lanškroun

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The Czech Republic – King Among Spa Venues

The Czech Republic is rightly For example North Moravia and Mariánské Lázně, visitors can admire the recognised as a spa heaven. Silesia offer Lázně Jeseník (www. unique neobaroque colonnade built in info-jesenik.cz/mesto/cz/historie/ 1889. The music and light performance of There are over thirty spa lazne.htm), which can boast of one of the the Singing Fountain are also a remarkable locations with natural healing world primacies. It was here that, in 1882, experience. The last spa town of the sources scattered around the the world’s first hydrotherapeutic institute triangle, Františkovy Lázně, are thanks to its was founded. In the beautiful mountain beautiful environment and classicist country. The uniqueness lies in environment nearby lies the picturesque architecture considered the gem of Czech the use of natural healing spa town of Karlova Studánka (www. spa industry. West Bohemian spas hold one sources for curing many ailments k.studanka.cz), the place with the cleanest world primacy; in 1906 the first radon spa and disorders ranging from air in central Europe. in the world, was founded here. Lázně Jáchymov (www.laznejachymov.cz) can locomotive, nervous, and SPA TRIANGLE boast of a unique thermal radioactive spring respiratory diseases to skin In West Bohemia lie the most renowned spa cure, still unique on the world scale. In 2006 problems. Despite the fact that towns of Karlovy Vary (www.karlovyvary.cz), it will celebrate its centenary. Last year over the healing aspect still plays the Františkovy Lázně (www.frantiskovy- 17 000 visitors came to this spa town. lazne.cz), and Mariánské Lázně (www. The oldest and also one of the most main role in Czech spa industry, marianskelazne.cz), which together form modern spas in the Czech Republic is Lázně nowadays people do not come to the so-called western Bohemian spa Teplice (www.lazneteplice.cz), which spas solely to be cured. Spa triangle. The number of healing mineral specialises in the disorders of locomotive, springs in this region has no equal in the circulatory, and nervous systems. The first procedures are also used as world. The springs are used to heal ailments mention of its healing springs are almost prophylaxis against ailments and of the digestive, locomotive, circulatory, and two thousand years old. In no way less are a suitable means to increase respiratory systems, illnesses resulting from significant is the spa town of Poděbrady physical and mental fitness. metabolic disorders and gynaecological (www.lazne-podebrady.cz). It lies in a fertile diseases. The charm and unique valley only 50 km away from Prague and it Supplementary wellness and atmosphere of these spa towns were is a sought after spa for the ailments of the fitness programmes, relaxation, discovered many centuries ago by world- heart. We should not forget to mention anti stress and special famous figures such as Goethe, Bach, Lázně Luhačovice (www.lazneluhacovice. beautifying procedures attract Schiller, Beethoven, Chateaubriand, or cz), the largest Moravian spa aimed at Gogol. You can meet many popular and illnesses of the respiratory and digestive more and more guests. A feature significant persons from the world of systems, metabolic disorders and disorders politics or culture here even today. In of the locomotive system. to add is the professional Photo: CzechTourism approach, reasonable prices, and modern spa equipment, whose quality and facilities will satisfy even the most demanding clients.

CONTACTS:

Svaz léčebných lázní (Spas Association of the Czech Republic) www.lazne-kur-spa.cz

Sdružení lázeňských míst ČR (Association of the Spa Places) in the Czech Republic www.spas.cz

Seznam lázeňských míst ČR (A List of Spa Places in the Czech Republic) www.spa.czecot.com/ Jáchymov spa takes pride in unique treatment based on its thermal radioactive waters

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FIRST BEER SPA IN THE COUNTRY

A bath full of a frothy liquid, everywhere the air is full of the characteristic odour. A bath, then a massage and a pack using malt flower. This relaxation procedure is offered by the Chodov family brewery (www.chodovar.cz/pivni-lazne) in Chodová Planá in the Tachov Region from March 2006. They were the first to open a unique beer spa in the Czech Republic. The beer provides the spa guests with its curative effects and relaxation. The bath consists of water from local mineral spring, dark ten- degree Chodovar beer draught into the Mariánské lázně bath right from the tap, and a secret Lázně Bechyně (www.laznebechyne.cz) healing source here. It is mined from the mixture of herbs. The important thing is is also one of the oldest spas. It is located spa’s own peat bog in Komárovská blata. that beer contains thiamine; the whole in South Bohemia and it specialises in mixture affects skin directly and can help curing and reconditioning the locomotive Karin Šeligová to cure some types of eczema. Hop system (rheumatic arthritis, spondylitis or CzechTourism contains calming substances, carbon osteoporosis). Peat rich in resin and (e-mail: [email protected]) dioxide promotes blood circulation.

aromatic substances is used as the natural www.czechtourism.cz Photo: CzechTourism

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Where Else But to the Czech Republic?

The year 2005 was a record year "The world trend in the field of tourist 37.4 % (12 579). Among the Scandinavian regarding the incoming tourist industry in recent years is several countries we are still most favoured among shorter holidays every year, which Norwegian tourists of which 30.9 % industry in the Czech Republic corresponds to the average tourist stay in (86 360) more came to our country in all its history since the Czech the Czech Republic. It is 4.1 days and stays compared to the previous year. Statistical Office started to on the level of the year 2004", says the The 26 % growth of incoming Japanese analyst of the Public Relations department tourists is also significant, as Japanese monitor numbers of foreign Hana Fojtáchová. tourists spend more on their holiday in tourists in public accommodation Over a quarter of the foreign tourists who comparison to tourists of other nationalities. facilities. 6 336 128 foreign stayed here are traditionally from Germany. Chinese tourists have similar shopping tourists visited the Czech Compared to 2004, their number grew by habits; 7 806 of them came here last year. 2.4 % to the level of 1 606 947. Statistics of Chinese tourists have been kept Republic, which is 4.5 % more The British are again on the second place; only since 2005. China as a source country than in 2004. Their spending 657 110 British tourists came to the country represents a great potential for international increased by 3.5 % compared and the increase represents 6.4 %. tourism and Chinese tourists come very to 2004 and reached the level Very pleasant is the increase in the close to the Japanese regarding their number of incoming Polish tourists; the expenditures on their travels abroad. of CZK 110.9 billion (approx. number of Poles coming to the Czech EUR 3.7 billion). Republic increased by 3 %. The Baltic The Czech Republic witnesses Republics’ interest in the Czech Republic has also grown. The number of tourists from Karin Šeligová not only the trend of growing Lithuania increased by 20 % compared to CzechTourism number of visitors using hotels, the year 2004 (35 258), from Latvia by (e-mail: [email protected]) boarding houses, and other 16.4 % (12 627), and from Estonia by a full www.czechtourism.cz public accommodation facilities, The Development of the number of foreign tourists and number of nights spent but also the trend of growing in the Czech Republic from 2000 to 2005 numbers of nights spent here; 25000000 in 2005 it reached the level 20000000 of 19 595 035 nights. 15000000

10000000

5000000

0 2000 2001 2002 2003 2004 2005 Number of foreign tourists in PAF Number of nights in PAF (public accommodation facilities) Source: Czech Statistical Office

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