INVESTMENT OPPORTUNITIES

Investment Climate
in the Czech Republic
1 10
Foreword by CzechInvest’s CEO Financial Support for Investment
2 12
Main Reasons to Invest in the Czech Republic Well-developed Domestic Supply Base
4 13
Attractive Investment Climate Highly Developed Property Market
6 14
Impressive FDI Results International Membership
7 15
Selected Investors Testimonials from Successful Investors
8 16
FDI Growth Sectors CzechInvest´s Services

Last update: August 2009

CzechInvest’s Services
Alexandra Rudysarova
Chief Executive Officer, CzechInvest
CzechInvest, the Investment and Business Development Agency, is an agency of the Ministry
of Industry and Trade. Established in 1992, the agency contributes to attracting foreign
investment and developing domestic companies through its services and development
programmes. CzechInvest also promotes the Czech Republic abroad and acts as an
intermediary between the EU and small and medium-sized enterprises in implementing
structural funds in the Czech Republic. Our systems of quality management and information
security were certified by Quality Austria and Certification & Information Security Services in
accordance with ISO 9001:2000 and ISO 27001:2005.
Foreword by CzechInvest’s CEO
Dear Readers,
It is no coincidence that the Czech Republic is among the countries with the greatest
inflow of foreign capital in the region of Central and Eastern Europe. Czechs are known
for their emphasis on quality and professionalism, their desire to learn new things, and
their ability to achieve a high degree of labour productivity.
Investors appreciate attributes such as a stable business environment, low interest rates
and transparent legislation. Gone are the days when the Czech Republic attracted foreign
investors primarily due to the country’s inexpensive labour. Nowadays, an ever greater
proportion of the total volume of investments is represented by investments in
technology centres, business support services and research and development.
Investor’s interest in this area is underpinned primarily by the effective labour market, job-
applicants’ level of education, and high-quality universities and their ability to respond to
companies’ real-world needs. The country’s well-developed education system, a
component part of which is comprised of universities with histories dating back several
centuries, guarantees that companies in the Czech Republic have an abundant supply of
graduates from technical, economic and other fields.
Another, but in no way less significant, advantage of the Czech Republic is its
geographical position in the centre of Europe. Czech legislation, which is in accordance
with European Union law, provides a guarantee of easy access to European markets for
investors and entrepreneurs. Thanks to its developed infrastructure and membership in
the European Union, the Czech Republic can also become your gateway to European
markets.
Projects that place strong emphasis on top-quality specialists are a priority for the
government and will be supported to the maximum extent. It is in the Czech Republic’s
interest to retain top specialists in fields that are of key importance in achieving economic
growth and increasing the competitiveness of the Czech economy.
CzechInvest, the government agency for investment and business development, plays a
crucial role in helping foreign investors establish their businesses in the Czech Republic.
The agency provides incoming investors with information services, support in obtaining
incentives, identification of suitable investment locations and other supportive consulting
services.
I believe that the Czech Republic’s ambition to become an attractive country for investors
in advanced fields with strong demand for technology and innovation is well-founded.
The Czech Republic, a country in the heart of Europe, is regularly at the top of rankings
evaluating the attractiveness of countries with regard to the business environment and
investments.
I wish you much success in the Czech Republic.
Alexandra Rudysarova
Chief Executive Officer, CzechInvest
 Main Reasons to Invest Testimonials from Successful Investors
in the Czech Republic

Czech educational system meets the needs

-- Safe investment environment
of a competitive economy = 10 -- Skilled workforce
-- High share of secondary and tertiary education within the population
7 -- Favourable labour costs and price stability
6 -- Central location in Europe
6.26
5.94
5 5.61 -- Compact and high-quality infrastructure
5.22
4
5.06
4.58 4.56
-- Transparent system of investment incentives
4.49 4.32
3 3.6 -- Strong focus on R&D
2 -- Stable social and political system
1 -- EU membership
0 -- Mentality, culture and attitudes close to western countries
Netherlands Germany Czech United Hungary
Republic Kingdom Slovak -- Enviable life style
France USA Japan Poland Republic

Source: Institute for Management Development,

World Competitiveness Book, 2008 Well-educated and Skilled Workforce

Population that had attained at least upper secondary The Czech educational system meets the needs of a competitive economy, according
education in 2006
(% by age group 25-64) to the 2008 World Competitiveness Book published by the Institute for Management
Development. The Czech Republic can provide manufacturers with impressive
100
productivity levels and highly skilled labour. According to a 2008 OECD study, the
80 90 Czech Republic has a very strong position regarding the percentage of students
88
83 graduating in engineering, manufacturing and construction fields. In the year
60 69 68
67 67
2008/2009, there were approximately 67,000 technically orientated students at Czech
universities. The number of university students increased from 118,000 in 1990/91 to “How can we characterize the Czech software engineer? Based on my experience
40 369,619 in 2008/2009, due not only to changes in the education system but also to a working with international teams from China to the Bay Area, I can say that Czech
demographic bulge of 18-26-year-olds that represent a promising group of potential software engineers are as good as their western counterparts, regardless of whether we
20 employees for foreign investors. According to the last Eurobarometer survey 61% of look at innovation, efficiency, discipline, or experience, and they usually work harder. The
Czechs are able to speak at least one foreign language (predominantly English and roots of this healthy environment lie in the Czech Republic’s high-quality education
0
Czech United Germany UK OECD France Belgium German). system, which provides the heterogeneous skill sets of the country’s software engineers.”
Republic States Average Radovan Janecek, Chief Architect, BTO, HP Software R&D

Nine out of ten Czechs aged 18 to 59 speak at least one foreign language, and their
Source: Education at a Glance, OECD Indicators, 2008
knowledge is rapidly improving, according to a survey conducted by AUGUR “We are very pleased with our decision to locate our project in the Czech Republic. It is
Consulting for CzechInvest at the end of last year. The survey shows a 13% increase in a developed country and our Czech colleagues and employees are technically erudite,
Respondents able to participate in a conversation
language skills in comparison with the results of similar research conducted six years flexible and hardworking.”
in another language than their mother tongue Kim Eok-Jo, president, Hyundai Motor Manufacturing Czech
(%) ago.
70 “Lonza Kourim Czech Republic is the leading technology and manufacturing service
60 Proven Research and Development Capabilities provider for biopharmaceuticals in Eastern Europe.”
69 67 Stephan Borgas, CEO of Lonza
61
50
57 56 51
40 The Czech Republic spends more resources on research and development than many
42 “The Czech Republic offers a highly skilled and very efficient workforce with a strong,
30 of its competitor countries. Over the past ten years, the Czech Republic’s spending on
technically oriented educational background and a large number of engineering
20 R&D has increased from 0.95% of GDP to 1.42%. Many multinationals are running
graduates. The country has a rich industrial history and a university system that is highly
10 Czech R&D or design centres, including Panasonic, Honeywell, Mercedes-Benz,
recognized.”
0 Motorola, Rockwell Automation and Visteon. Czech scientists are behind some of the Jaroslav Dolezal, Honeywell National Executive for the Czech Republic
Finland Germany Czech Poland EU25 France Hungary
Republic world’s well-known discoveries and patents, such as soft contact lenses, polarography
– a Nobel-prize-winning method of quantitative analytical measurement, and the anti- “When Rolls-Royce made the decision to enter the Central and Eastern European market
Source: European Commission, Eurobarometer, 2006 HIV drugs cidofovir (Vistide®) and tenofovir (Viread®), to name but a few. in the mid 1990s, the Czech Republic was the natural choice. Prague had the
infrastructure and position that we needed for establishing our headquarters for Central
and Eastern Europe. Today, from Prague we manage our business in nineteen countries
across the territory, the business encompassing civil aerospace, defence aerospace,
marine and civil nuclear.”
Paul Kaye, Managing Director of Rolls-Royce Central and Eastern Europe
14 3

Technical* graduates with tertiary education in Czech Technology Days

selected countries
(% of tertiary bachelor and master graduates in 2006)

The Czech Republic is very seriously involved in seeking out synergies in scientific and
25
technological development in cooperation with other developed countries in order to
20 achieve much stronger and more efficient results of joint research and development
19.7
15 projects, as well as programmes. Therefore, in 2005 the Czech ministries, together with
16.2 15.3
10 CzechInvest and other partners, established annual bilateral meetings called the Czech
12.6 12.6 11.3
5
8.8 8.6 Technology Days. For more information, please visit www.czechtechnologydays.org.
6.3 6.2
0
Japan Slovakia Germany UK Hungary
Czech
Republic
France Belgium Poland USA
Favourable Labour Costs
*Engineering, manufacturing and construction graduates
Source: Education at a Glance, OECD indicators, 2008 One of the main attractions of the Czech economy is its skilled and well-educated workers
available at a fraction of the cost of those in western economies. Over the past five years
average annual wage has grown around 6-7% but it is coming from much lower base
Labour costs per hour in 2008
USD
compared to Western Europe. Differences in remunerations among regions reach
approx. 20%. Traditionally, employees in Prague are paid more than in other regions
0 10 20 30 40 50 (currently 25% above Czech average).
Czech Republic 14.44

United States 25.52 Central Location in Europe and Advanced Infrastructure

United Kingdom 28.38

France 31.61 The Czech Republic has a strategic location in the centre of Europe with very good access
to established western and emerging eastern markets. Prague is only a two-hour flight
Belgium 39.32
from most other European capitals. The significance of the Czech Republic as a transit
Germany 41.22 hub has grown since the Czech Republic became a member of the EU Single Market.The
road and motorway network (total 55,654 km) is already one of the densest in Central and
Source: The Economist Intelligence Unit, 2009
Eastern Europe and several rail modernization projects are currently underway to link the
Czech Republic with the pan-European network of high-speed railways (total 9,588 km).

Central location in Europe Infrastructure in the Czech Republic

Existing expressways Planned expressways Existing motorways Planned motorways

Leipzig Berlin
Berlin Hamburg
Wolfsburg
Y Wroclaw
M AN Erfurt Liberec
Gliwice
ER
Helsinki Děčín
Kassel Jablonec n. N. PO
Oslo Stockholm G Teplice ÚSTÍ N. L.
Česká Lípa
Semily
LAN
Most Mladá
Trutnov
D
Chomutov Boleslav Jičín Náchod
Louny Mělník
Karlovy Vary Kladno HRADEC Jeseník Warsaw
Copenhagen Nymburk
KRÁLOVÉ
Bruntál
Dublin Würzburg Cheb
Sokolov Rakovník Kolín
PARDUBICE Ústí n. O. Šumperk Opava Bielsko
Amsterdam Frankfurt Beroun PRAGUE Karviná
Warsaw OSTRAVA - Biala
London Berlin Svitavy
Tachov PLZEŇ Benešov
OLOMOUC Frýdek Cracovie
Příbram Havlíčkův Místek
Brussels Brod Žďár n. S. Nový Jičín
Prostějov
Bratislava Přerov
Paris Munich Pelhřimov Kroměříž Vsetín
Domažlice
Vienna
Budapest Munich Klatovy Písek Tábor Jihlava
Blansko

Bern Ingolstadt Strakonice

Třebíč Vyškov Zlín Kosice
Stuttgart Jindřichův BRNO Uh. Hradiště Trnava
Milan Hradec
Marseille Istanbul Torino Prachatice
ČESKÉ
Hodonín
BUDĚJOVICE Znojmo
Lisbon Rome G Břeclav
Barcelona ER Český Krumlov

A
Madrid
M

KI
Athens
AN

VA
Vienna Bratislava
Y

O
Linz Györ

SL
Steyr AUSTRIA
Graz
Source: Road and Motorway Directorate of the Czech Republic, 2008
Source: CzechInvest, 2009
 4 13

Attractive Investment Climate Highly Developed Property Market

Czech credit ratings The Czech Republic is a fully-fledged parliamentary democracy and one of the most Thanks to the continued interest of real estate investors, the Czech Republic has a
advanced new EU members. Its economic policy is consistent and predictable. An open highly developed and dynamic real estate market. The supply of office space is
Rating Agency
investment climate has been a key element of the Czech Republic’s economic transition. growing steadily while the availability of space for production facilities has been
Rating (February 2009)
The Czech Republic has attracted a large amount of foreign direct investment (FDI) since boosted by a major government programme designed to support the development of
Moody’s A 1990, making it the most successful transition country in terms of FDI per capita. municipal industrial properties and zones.
Standard & Poor’s A1 The country’s investment grade ratings from international credit-rating agencies and its
Fitch IBCA A+ early membership in the OECD testify to its positive economic fundamentals. Our Services
Source: Czech National Bank, February 2009
Competitive Advantages of the Czech Republic -- Assistance in gaining financial assistance from public resources (both EU and state
aid)
The Czech Republic tops CEE countries in According to the 2008-2009 Global Competitiveness Report published by the World -- Provision of information on the real estate market
the competitiveness ranking of world economies
Economic Forum, the Czech Republic ranks 33rd among 134 world economies in -- Preparation of offers of property according to your requirements – selection from an
competitiveness (Rank/134). extensive database of business properties for industry and business support services
6 -- Arranging of contacts with property owners, state administrative bodies and local
5.74 -- Quality of the educational system (26) authorities
5
5.46 5.3 -- Quality of math and science education (8) -- Organization of visits to recommended sites
4
4.62
-- Internet access in schools (19) -- Assistance with preparation and financing of strategic projects (industrial zones)
4.5 4.4 4.28 4.22
-- Availability of scientists and engineers (11) focused on business real estate
3
-- Corporate spending on R&D (26) -- Promotion of business real estate
-- Cooperation between universities and industry (26) -- Offer of brownfields as investment opportunities at www.brownfieldy.org
2
-- FDI and technology transfer (13)
1 -- Prevalence of trade barriers (8) Supported Types of Business Properties
0
USA UK Slovenia Poland
-- Flexibility of wage determination (7)
Germany Czech Slovak Hungary -- Legal rights index (29)
Republic Republic -- Industrial zones and business parks
-- Quality of electricity supply (20)
-- Production halls
-- Mobile telephone subscribers (7)
Source: World Economic Forum, Global Competitiveness Report 2008-2009 -- Technology centres
-- Science and technology parks
Investment Protection -- Office buildings and administrative facilities
Standard rate of corporate income tax
(%)
The Czech Republic is a member of the Multilateral Investment Guarantee Agency
(MIGA), an international organization for protection of investments, which is part of the
More than 100 Industrial Zones and Parks
35

30
World Bank-IMF group. The country has signed a number of bilateral treaties which
31
25
support and protect foreign investments, for example with the United States, Germany, Map of industrial zones supported since 1998
28
26 24 24 the UK, France, Austria, Switzerland, Italy, Belgium, Luxembourg, the Netherlands,
20
21
20
19
Finland, Norway, Denmark and China. The Czech Republic has also concluded
15
agreements for the avoidance of double taxation.
10
10 76
5 9 11
8 12
0
7 39
6 86
2003 2004 2005 2006 2007 2008 2009 2010 5 13
1
4 38
14 83
2 15
3 37 40
Source: CzechInvest, 2009 16 84
18 17 61
Praha 33 36 73
19 34 35 60
20 85 32
21 41 74
31 71 72
22 42 51 59
63 75 70
23 30 62 69 79 68
77 58 81
24 43 50
29 49 52 57 67
64
27 28 44 87 82 66
53 56
45 48 65
25 46 80 55
26 47 54
78
 12 5

Basic Data

Key information on the Czech Republic

Area 78,864 km2

Population 10.5 million
Labour 5.7 million
Capital Prague
Language Czech
Major cities (population) Prague (1,233,211), Brno (370,592), Ostrava (336,735), Plzen (185,125),
Olomouc (231,339), Usti nad Labem (121,024), Liberec (168,561), Hradec
Kralove (162,377), Pardubice (166,519), Ceske Budejovice (185,584)
Time zone GMT +1, summer time GMT +2

Source: Czech Statistical Office, June 2009

Supplier Forums
Czech economic indicators

Does your company operate in the

Indicators 2003 2004 2005 2006 2007 2008 2009 2010
manufacturing industry, and are you considering Estimate Forecast

GDP (constant prices 2000, %) 3.6 4.5 6.3 6.8 6.1 3.0 -4.3 0.3
the possibility of using Czech suppliers and you
GDP per capita (PPS / EU-27) 15,200 16,300 17,100 18,300 20,000 20,400 19,700 19,800
would like to know what they have to offer? If so,
Long-term interest rates (government bonds) 4.12 4.75 3.51 3.78 4.28 4.55 4.5 4.4
you have come to the right place: CzechInvest Trade balance (% GDP) -2.7 -0.5 2.0 2.0 3.4 2.8 3.0 3.1
organises tailor-made supplier forums to which Average inflation rate (%) 0.1 2.8 1.9 2.5 2.8 6.3 1.1 1.1

we invite Czech firms according to our clients’ Unemployment (avg., thousand persons) 521.6 537.4 514.3 474.8 392.8 324.6 475 578
Unemployment rate (avg., %) 9.90 9.2 8.97 8.13 6.62 5.44 8.2 9.8
needs. All you have to do is contact us and
explain your supplier requirements. We’ll take
Source: Ministry of Finance, July 2009
care of the rest.

EU legislation was adopted in preparation for EU accession. Commercial, accounting

and bankruptcy laws are compatible with western standards. The Czech crown is fully
convertible. All international transfers (e.g. profits and royalties) related to an
investment can be carried out freely and without delay.

Foreign legal entities from EU and other states may acquire real estate in the Czech
Republic without any restrictions and under the same conditions as Czech legal
entities. Hence, the original legal requirements as to the location of the company or an
establishment of a branch in the Czech Republic and entitlement to conduct business
in the Czech Republic were lifted.
 6 11

Impressive FDI Results

Cumulative FDI inflow by sector 1993 – 2008 Inflow of Foreign Direct Investment

The Czech Republic is one of the most successful CEE countries in terms of attracting
Trade, hotels and restaurants
12% foreign direct investment. Over 138,000 Czech firms across all sectors are now
Transport, storage Real estate and
and communications business activities supported by foreign capital. According to the Czech National Bank, a total amount of
16% 14%
EUR 69.6 billion worth of FDI has been recorded since 1993.
Electricity, gas,
and water supply
5%
The introduction of investment incentives in 1998 stimulated a massive inflow of FDI into
Financial Other greenfield projects. Amendments to the investment-incentives legislation have further
intermediation 1%
21% eased the attraction of new investments.

Manufacturing According to an Economist Intelligence Unit study from 2009, the Czech Republic has
31%
consistently attracted a high rate of foreign direct investment per capita since 2000,
Source: Czech National Bank, March 2009 which confirms the country’s strong attractiveness for foreign investors.

Cumulative FDI inflow by country 1993 – 2008 Stock of inward foreign direct investment per capita
(USD)

Japan Sweden Other

1% 2% 19% 2006 2007 2008 2009 2010
United Kingdom
4% Bulgaria 2,859.87 4,475.60* 5,404.20* 5,917.10** 6,598.80**
Belgium
4% Czech Republic 7,800.44 9,881.37 10,916.20* 11,366.50** 11,868.00**
Switzerland Hungary 10,479.30 14,851.30* 15,273.80* 15,584.40** 16,017.20**
5% Germany
25% Poland 3,297.82 4,619.42 5,098.10* 5,414.00** 5,769.50**
United States
6% Romania 2,110.26 2,828.93 3,453.80* 3,736.60** 4,206.50**
France Slovakia* 7,031.68 7,456.92 7,887.80* 8,099.00** 8,365.40**
7%

Austria *Estimates, **Forecasts

11% Netherlands Source: Economist Intelligence Unit, 2009
16%

Source: Czech National Bank, March 2009

Services Surpass Manufacturing

The structure of FDI inflow into the Czech Republic has been changing substantially and
More value-added investment projects
the trend is expected to strengthen in the coming years. The Czech Republic is
experiencing the introduction of a new, very valuable type of economy, which is based
1994 2008 not on the traditional processing of resources, but on the knowledge of the country’s
Manufacturing
people. Last year investments in research and development and business support
Technology 37%
centres services in the Czech Republic outweighed those in manufacturing projects for the first
36%
time.

Performance of Foreign Companies in the Czech Republic

The Czech Republic hosts over 65,000 foreign companies of all sizes. Famous
Manufacturing
100%
Business support services
27%
multinational companies such as ABB, Continental, DANONE, Ford, Panasonic, Nestlé,
IBM, DHL, Astra Zeneca, Rockwell, Procter & Gamble, Renault, Siemens, Tyco,
Honeywell, and Volkswagen have significant subsidiaries in the Czech Republic.
Source: CzechInvest, 2009

*Used exchange rate CZK/EUR 26

Foreign-owned companies are transforming the Czech economy:
-- Employ 45.7% of the industrial workforce
-- Produce 59.5% of industrial sales
-- Generate 70.1% of direct industrial exports

Source: Survey of the Czech Economy, Ministry of Industry and Trade, 2008
 10 7

Selected Investors

The change in the structure of foreign direct investment shows the new trend in the
Czech Republic. The number of demanding projects in the fields of research,
development and business support services is rapidly increasing. New investors as well
as those companies that formerly only came with a production programme are now
transferring their higher-added-value development activities (technology centres or
business support services centres) to the Czech Republic.

Selected Investors in the Czech Republic

Sector Investor Country of origin

Technology Centres Panasonic Japan
Honeywell USA/Germany
Valeo France
Rockwell USA
Statistics - manufacturing
Software & ICT services IBM USA
Hewlett-Packard USA
563 projects received the decision SUSE Linux USA
on investment incentives
HSBC Bank UK
Investment EUR 20,467 mil.
Business Support Services DHL Germany
Newly created jobs 116,673
Accenture USA
Exxon Mobil USA
Source: CzechInvest, June 2009 Monster USA
Aerospace Industry Lufthansa Germany
Honeywell Aerospace USA
GE Aviation USA
Latecoere France
Advanced Automotive Hyundai Korea
Volkswagen GERMANY
Toyota/PSA Japan/France
Robert Bosch Germany
Industrial Machinery, Ingersoll Rand USA
Equipment and Tools Siemens Germany
Honeywell USA
Daikin Japan
Life Sciences Baxter USA
Lonza Switzerland
TEVA Israel
Sanofi-aventis France
EE/Electronics Panasonic Japan
ON Semiconductor USA
Foxcom Taiwan
TYCO Electronics USA

Source: CzechInvest, 2009

Statistics – technology centres Potential Programme, Call II, open till September 30, 2009
Form of support

57 projects received the decision about subsidy Cash subsidy Up to EUR 4 mil.
Investment EUR 51 mil. Up to 60% of the costs of long term tangible and intangible assets

Source: Potential Programme, Call I

 8 8
FDI Growth Sectors
CzechInvest focuses on supporting those sectors in which it sees significant potential for
development. Below are highlights of the priority economic-growth sectors of the Czech
Republic. For each of these sectors, CzechInvest has a specialist who can provide
investors with in-depth sector-specific information.
Software & ICT Services
The Czech Republic has emerged as Europe’s top location for offshoring and
outsourcing of IT services. Repeatedly recognized by various researchers this fact is
confirmed by the strong inflow of high-value-added projects of the world’s top IT
companies and is fuelled by the country’s tradition of excellence in technical fields.
Business Support Services
Within the business support services sector two main types of activities are supported –
shared services centres (in-house centres of excellence – finance/accounting, HR, IT and
other activities, BPOs, KPOs and LPOs) and high-tech repair centres for products and
technologies. The Czech Republic has a mature services market with over 50 projects
from companies such as DHL, Accenture, IBM, Motorola, Schneider Logistics, Johnson &
Johnson and many more. The Black Book of Outsourcing’s survey from 2008 ranked the
Czech Republic as the most attractive location for investment in the BPO sector in
Europe and fifth worldwide.
Aerospace Industry
In comparison with other countries, the Czech Republic progressively advanced from
lower categories of aerospace production to more sophisticated products such as
commercial aircraft and military jets over more than 90 years. Our aerospace heritage has
brought us extensive knowledge derived from the results of numerous aircraft tests. This
has contributed to building a strong aerospace culture in which generations of designers
have been able to acquire and develop advanced skills. These capabilities are valued by
Honeywell Aerospace, GE Aviation and other companies operating in the Czech
Republic. The Czech aerospace sector includes the following areas: aviation, space,
UAV, MRO and other related branches.
Advanced Automotive
The Czech Republic is home to one of the world’s highest concentrations of automotive-
related manufacturing, design and R&D activity, making the automotive sector one of the
leading industries in the national economy. It accounts for more then 20% of
manufacturing output, almost 8% of national GDP and more than 120,000 directly related
jobs. At full capacity, three major production plants – Škoda, TPCA and Hyundai –
produce more than 1,200,000 cars annually and the presence of almost half of the
world’s top fifty leading component manufacturers underscore the sector’s importance.
9
Industrial Machinery, Equipment and Tools
The continuously increasing competitiveness of Czech companies in this sector is
particularly due to their ability to cover a wide range of activities, from construction and
design to production, and to the comprehensiveness of their products and
supplementary services. The sector accounts for more than 13% of revenues from the
sale of products and services of the manufacturing industry, and almost 7% in added
value. The sector maintains its strong position as a traditional exporter – between 80%
and 90% of the sector’s output is exported.
Life Sciences
Life sciences have become a sector of global significance due to its potential in the area
of solving the biggest problems facing modern society and improving the quality of life.
Thanks to a strong research base, well-educated workforce and favourable business
environment, this strategic sector is developing very quickly in the Czech Republic.
Global companies such as Baxter, Lonza, Otsuka Pharmaceutical, TEVA and Beckman
Coulter are developing their operations in the Czech Republic.
Electrical Engineering/Electronics
More than anything else, the Czech EE/electronics sector is based on a long tradition and
highly qualified employees. The industry is evenly spread around the country and
employs nearly 210,000 people with total revenues of EUR 19.7 billion (in 2007). The
country's manufacturing portfolio includes practically all branches of EE/electronics, from
electric drives/engines and power supply to consumer electronics and microchips. The
dynamic growth of the electronics industry and great references from investors prove
Czech Republic’s status as a renowned investment destination.
Advanced Renewable Energy
The Czech Republic has great potential in the area of renewable energy sources and
alternative biofuels. This market segment is not yet saturated and can offer a well-
educated and experienced workforce. Moreover, financial support is available from
European programmes. Solar energy, renewable energy from biomass and alternative
biofuels offer opportunities for long-term profitable investment in the Czech Republic.
Nanotechnology
The nanotechnology sector plays an important role in many major sectors, such as
mechanical engineering, electronics, biotechnology, medicine, power generation, and
environmental protection, to name just a few. Over the past decade, this sector explosive
development in the Czech Republic has undergone. Several academic and private
entities have achieved tangible successes and hold patents on new developments in the
area of nanotechnology. Companies such as CPN, Crytur, Elmarco, and Optaglio, among
others, have achieved not only better-than-average results but they are capable of
competing on the global market. The sector is supported by various initiatives, such as
Nanotechnology for Society, which comprise a platform for universities and the industrial
sphere that will guarantee long-term development in this field.
 8 8
FDI Growth Sectors
CzechInvest focuses on supporting those sectors in which it sees significant potential for
development. Below are highlights of the priority economic-growth sectors of the Czech
Republic. For each of these sectors, CzechInvest has a specialist who can provide
investors with in-depth sector-specific information.
Software & ICT Services
The Czech Republic has emerged as Europe’s top location for offshoring and
outsourcing of IT services. Repeatedly recognized by various researchers this fact is
confirmed by the strong inflow of high-value-added projects of the world’s top IT
companies and is fuelled by the country’s tradition of excellence in technical fields.
Business Support Services
Within the business support services sector two main types of activities are supported –
shared services centres (in-house centres of excellence – finance/accounting, HR, IT and
other activities, BPOs, KPOs and LPOs) and high-tech repair centres for products and
technologies. The Czech Republic has a mature services market with over 50 projects
from companies such as DHL, Accenture, IBM, Motorola, Schneider Logistics, Johnson &
Johnson and many more. The Black Book of Outsourcing’s survey from 2008 ranked the
Czech Republic as the most attractive location for investment in the BPO sector in
Europe and fifth worldwide.
Aerospace Industry
In comparison with other countries, the Czech Republic progressively advanced from
lower categories of aerospace production to more sophisticated products such as
commercial aircraft and military jets over more than 90 years. Our aerospace heritage has
brought us extensive knowledge derived from the results of numerous aircraft tests. This
has contributed to building a strong aerospace culture in which generations of designers
have been able to acquire and develop advanced skills. These capabilities are valued by
Honeywell Aerospace, GE Aviation and other companies operating in the Czech
Republic. The Czech aerospace sector includes the following areas: aviation, space,
UAV, MRO and other related branches.
Advanced Automotive
The Czech Republic is home to one of the world’s highest concentrations of automotive-
related manufacturing, design and R&D activity, making the automotive sector one of the
leading industries in the national economy. It accounts for more then 20% of
manufacturing output, almost 8% of national GDP and more than 120,000 directly related
jobs. At full capacity, three major production plants – Škoda, TPCA and Hyundai –
produce more than 1,200,000 cars annually and the presence of almost half of the
world’s top fifty leading component manufacturers underscore the sector’s importance.
9
Industrial Machinery, Equipment and Tools
The continuously increasing competitiveness of Czech companies in this sector is
particularly due to their ability to cover a wide range of activities, from construction and
design to production, and to the comprehensiveness of their products and
supplementary services. The sector accounts for more than 13% of revenues from the
sale of products and services of the manufacturing industry, and almost 7% in added
value. The sector maintains its strong position as a traditional exporter – between 80%
and 90% of the sector’s output is exported.
Life Sciences
Life sciences have become a sector of global significance due to its potential in the area
of solving the biggest problems facing modern society and improving the quality of life.
Thanks to a strong research base, well-educated workforce and favourable business
environment, this strategic sector is developing very quickly in the Czech Republic.
Global companies such as Baxter, Lonza, Otsuka Pharmaceutical, TEVA and Beckman
Coulter are developing their operations in the Czech Republic.
Electrical Engineering/Electronics
More than anything else, the Czech EE/electronics sector is based on a long tradition and
highly qualified employees. The industry is evenly spread around the country and
employs nearly 210,000 people with total revenues of EUR 19.7 billion (in 2007). The
country's manufacturing portfolio includes practically all branches of EE/electronics, from
electric drives/engines and power supply to consumer electronics and microchips. The
dynamic growth of the electronics industry and great references from investors prove
Czech Republic’s status as a renowned investment destination.
Advanced Renewable Energy
The Czech Republic has great potential in the area of renewable energy sources and
alternative biofuels. This market segment is not yet saturated and can offer a well-
educated and experienced workforce. Moreover, financial support is available from
European programmes. Solar energy, renewable energy from biomass and alternative
biofuels offer opportunities for long-term profitable investment in the Czech Republic.
Nanotechnology
The nanotechnology sector plays an important role in many major sectors, such as
mechanical engineering, electronics, biotechnology, medicine, power generation, and
environmental protection, to name just a few. Over the past decade, this sector explosive
development in the Czech Republic has undergone. Several academic and private
entities have achieved tangible successes and hold patents on new developments in the
area of nanotechnology. Companies such as CPN, Crytur, Elmarco, and Optaglio, among
others, have achieved not only better-than-average results but they are capable of
competing on the global market. The sector is supported by various initiatives, such as
Nanotechnology for Society, which comprise a platform for universities and the industrial
sphere that will guarantee long-term development in this field.
 10 7

Financial Support for Investment Selected Investors

Investment Incentives and Other Business Support Measures
The Czech Republic offers both new and existing investors support covering up to 60% of
costs associated with investment projects in manufacturing, technology centres and
business support services. Aid is provided in all regions, with the exception of Prague.
The change in the structure of foreign direct investment shows the new trend in the
Czech Republic. The number of demanding projects in the fields of research,
development and business support services is rapidly increasing. New investors as well
as those companies that formerly only came with a production programme are now
transferring their higher-added-value development activities (technology centres or
business support services centres) to the Czech Republic.

Manufacturing Sector Selected Investors in the Czech Republic

Sector Investor Country of origin

Aid for manufacturing projects is provided according to the Act on Investment Incentives Technology Centres Panasonic Japan
and offers the following incentives: Honeywell USA/Germany
Valeo France
Rockwell USA
Statistics - manufacturing Forms of incentives
Software & ICT services IBM USA
Hewlett-Packard USA
563 projects received the decision Tax incentive Full corporate tax relief for up to 5 years for new companies
SUSE Linux USA
on investment incentives Partial tax relief for up to 5 years for existing companies
HSBC Bank UK
Investment EUR 20,467 mil. Job-creation grants Financial support for creation of new jobs in selected regions Business Support Services DHL Germany
Newly created jobs 116,673 (up to EUR 2,000 per new job)
Accenture USA
Training and re-training grants Financial support for training and re-training of new employees (up to 45% of
Exxon Mobil USA
Source: CzechInvest, June 2009
eligible training costs)
Monster USA
Aerospace Industry Lufthansa Germany
Honeywell Aerospace USA
GE Aviation USA
Eligibility criteria
Latecoere France
Advanced Automotive Hyundai Korea
Minimum investment: EUR 2 – 4 mil. depending on the region's unemployment rate Volkswagen GERMANY
Half of the minimum investment must be financed by the equity of the investor Toyota/PSA Japan/France
60% of total investment must go into machinery Robert Bosch Germany
Machinery must be new Industrial Machinery, Ingersoll Rand USA
No works may be started prior the issuance of Confirmation of Project Registration at CzechInvest Equipment and Tools Siemens Germany
The project must be implemented in the Czech Republic outside the territory of Capital City of Prague. Honeywell USA
Daikin Japan
Life Sciences Baxter USA
Lonza Switzerland
Technology Centres TEVA Israel
Sanofi-aventis France
EE/Electronics Panasonic Japan
In order to strengthen the Czech Republic’s position as a technology hub in Central
ON Semiconductor USA
Europe, the Czech government supports investments in development activities. Foxcom Taiwan
Technology centres are defined as centres engaged in research, development and TYCO Electronics USA
innovation of high-tech products and technologies if there is expectation that the output
of such centres will be transferred and used in production. Aid for technology centres is Source: CzechInvest, 2009
provided via the Potential Programme.

Statistics – technology centres Potential Programme, Call II, open till September 30, 2009
Form of support

57 projects received the decision about subsidy Cash subsidy Up to EUR 4 mil.
Investment EUR 51 mil. Up to 60% of the costs of long term tangible and intangible assets

Source: Potential Programme, Call I

 6 11

Impressive FDI Results

Cumulative FDI inflow by sector 1993 – 2008 Inflow of Foreign Direct Investment Eligibility criteria

The Czech Republic is one of the most successful CEE countries in terms of attracting Minimum investment: large enterprise EUR 400,000, small or medium sized enterprise EUR 200,000
Trade, hotels and restaurants
12% foreign direct investment. Over 138,000 Czech firms across all sectors are now The project must be implemented in the Czech Republic outside the territory of Capital City of Prague.
Transport, storage Real estate and
and communications business activities supported by foreign capital. According to the Czech National Bank, a total amount of
16% 14%
EUR 69.6 billion worth of FDI has been recorded since 1993.
Electricity, gas,
and water supply The introduction of investment incentives in 1998 stimulated a massive inflow of FDI into Business Support Services Centres
5%
Financial Other greenfield projects. Amendments to the investment-incentives legislation have further
intermediation 1%
21% eased the attraction of new investments. In order to strengthen the Czech Republic’s position as an information hub in Central
Europe, the Czech government supports investments in business support services
Manufacturing According to an Economist Intelligence Unit study from 2009, the Czech Republic has centres. These are defined as centres engaged in selected activities with close ties to
31%
consistently attracted a high rate of foreign direct investment per capita since 2000, information technologies and a distinct international focus. ICT development and
Source: Czech National Bank, March 2009 which confirms the country’s strong attractiveness for foreign investors. implementation centres, high-tech repair centres and shared services centres are
supported via the ICT and Business Support Services Programme.

Cumulative FDI inflow by country 1993 – 2008 Stock of inward foreign direct investment per capita
(USD)

Japan Sweden Other Statistics – ICT and Business Support Services

2006 2007 2008 2009 2010 ICT and Business Support Services Programme, Call II, open till October 2, 2009
1% 2% 19%
United Kingdom
Form of support
4% Bulgaria 2,859.87 4,475.60* 5,404.20* 5,917.10** 6,598.80**
Belgium
4% Czech Republic 7,800.44 9,881.37 10,916.20* 11,366.50** 11,868.00** 75 projects received the decision about subsidy Cash subsidy Up to EUR 3.2 mil.
Switzerland Hungary 10,479.30 14,851.30* 15,273.80* 15,584.40** 16,017.20** Investment EUR 12 mil. Up to 60% of two years wages or 60% of costs of long term tangible and
5% Germany
25% Poland 3,297.82 4,619.42 5,098.10* 5,414.00** 5,769.50** Newly created jobs 880 intangible assets
United States
6% Romania 2,110.26 2,828.93 3,453.80* 3,736.60** 4,206.50**
France Slovakia* 7,031.68 7,456.92 7,887.80* 8,099.00** 8,365.40**
7% Source: ICT and Business Support Services Programme, Call I

Austria *Estimates, **Forecasts

11% Netherlands Source: Economist Intelligence Unit, 2009 Eligibility criteria
16%

Source: Czech National Bank, March 2009

Services Surpass Manufacturing Minimum investment: 112ths/37ths/18,5ths (Large/Medium/Small enterprise)
Min. number of newly created jobs:
The structure of FDI inflow into the Czech Republic has been changing substantially and ICT Development and Implementation Centre: 10/5/3 (Large/Medium/Small enterprise)
More value-added investment projects
the trend is expected to strengthen in the coming years. The Czech Republic is High-tech Repair Centre: 25/15/7 (Large/Medium/Small enterprise)

experiencing the introduction of a new, very valuable type of economy, which is based Shared Services Centre: 35/25/15 (Large/Medium/Small enterprise)
The project must be implemented in the Czech Republic outside the territory
1994 2008 not on the traditional processing of resources, but on the knowledge of the country’s
of Capital City of Prague
Manufacturing
people. Last year investments in research and development and business support
Technology 37%
centres services in the Czech Republic outweighed those in manufacturing projects for the first
36%
time.

Performance of Foreign Companies in the Czech Republic

The Czech Republic hosts over 65,000 foreign companies of all sizes. Famous
Manufacturing
100%
Business support services
27%
multinational companies such as ABB, Continental, DANONE, Ford, Panasonic, Nestlé,
IBM, DHL, Astra Zeneca, Rockwell, Procter & Gamble, Renault, Siemens, Tyco,
Honeywell, and Volkswagen have significant subsidiaries in the Czech Republic.
Source: CzechInvest, 2009

*Used exchange rate CZK/EUR 26

Foreign-owned companies are transforming the Czech economy:
-- Employ 45.7% of the industrial workforce
-- Produce 59.5% of industrial sales
-- Generate 70.1% of direct industrial exports

Source: Survey of the Czech Economy, Ministry of Industry and Trade, 2008
 12 5

Well-developed Domestic Supply Base

Supplier Databases

CzechInvest’s fundamental tool for seeking out suitable business partners is comprised
of its sector databases of Czech companies. These databases contain nearly 3,000 high-
quality records with a broad scope of information on Czech suppliers interested in long-
term cooperation with foreign partners. The databases are regularly updated and
supplemented according to the requirements of foreign companies, and contain
companies from the following sectors:

-- Aerospace
-- Automotive
-- Electronics and electrotechnics
-- ICT
-- Subcontracting Plastics
Supplier Forums -- Subcontracting Metal
-- Materials and packaging
-- Engineering
Does your company operate in the
-- Energy 2007
manufacturing industry, and are you considering
-- Healthcare, pharmacy and biotechnology
the possibility of using Czech suppliers and you 6.1
-- Space
20,000
would like to know what they have to offer? If so,
4.28
you have come to the right place: CzechInvest http://suppliers.czechinvest.org 3.4
organises tailor-made supplier forums to which Email: suppliers@czechinvest.org 2.8

we invite Czech firms according to our clients’ 392.8

6.62
needs. All you have to do is contact us and Through filtering by sector, technology, products, region, company name and by full text,
explain your supplier requirements. We’ll take the databases enable fast and simple searching for suitable suppliers and partners from
care of the rest. the Czech Republic.
 4 13

Attractive Investment Climate Highly Developed Property Market

Czech credit ratings The Czech Republic is a fully-fledged parliamentary democracy and one of the most Production halls Thanks to the continued interest of real estate investors, the Czech Republic has a
2
€/m /month
advanced new EU members. Its economic policy is consistent and predictable. An open highly developed and dynamic real estate market. The supply of office space is
Rating Agency
investment climate has been a key element of the Czech Republic’s economic transition. growing steadily while the availability of space for production facilities has been
Rating (February 2009)
The Czech Republic has attracted a large amount of foreign direct investment (FDI) since Net effective rent 2.50 – 5.50
boosted by a major government programme designed to support the development of
Moody’s A 1990, making it the most successful transition country in terms of FDI per capita. municipal industrial properties and zones.
Standard & Poor’s A1 The country’s investment grade ratings from international credit-rating agencies and its Source: CzechInvest, 2009
Fitch IBCA A+ early membership in the OECD testify to its positive economic fundamentals. Our Services
Industrial zones
2
€/m
Source: Czech National Bank, February 2009
Competitive Advantages of the Czech Republic -- Assistance in gaining financial assistance from public resources (both EU and state
aid)
Purchase price 15.00 – 56.00
The Czech Republic tops CEE countries in According to the 2008-2009 Global Competitiveness Report published by the World -- Provision of information on the real estate market
the competitiveness ranking of world economies
Economic Forum, the Czech Republic ranks 33rd among 134 world economies in -- Preparation of offers of property according to your requirements – selection from an
Source: CzechInvest, 2009
competitiveness (Rank/134). extensive database of business properties for industry and business support services
6 -- Arranging of contacts with property owners, state administrative bodies and local
Offices, Headline Rent
5.74 -- Quality of the educational system (26) €/m2/month
authorities
5
5.46 5.3 -- Quality of math and science education (8) -- Organization of visits to recommended sites
4
4.62
-- Internet access in schools (19) City Centre Inner City Outer City -- Assistance with preparation and financing of strategic projects (industrial zones)
4.5 4.4 4.28 4.22
-- Availability of scientists and engineers (11) focused on business real estate
Prague 21.00 – 23.00 15.00 – 17.50 1300 – 15.00
3
-- Corporate spending on R&D (26) 12.50 – 13.50
-- Promotion of business real estate
Brno 10.00 – 12.50
-- Cooperation between universities and industry (26) Ostrava 11.50 -- Offer of brownfields as investment opportunities at www.brownfieldy.org
2
-- FDI and technology transfer (13)
1 -- Prevalence of trade barriers (8) Source: CB Richard Ellis, 2009 Supported Types of Business Properties
0
USA UK Slovenia Poland
-- Flexibility of wage determination (7)
Germany Czech Slovak Hungary -- Legal rights index (29)
Republic Republic If you are interested in offering your -- Industrial zones and business parks
-- Quality of electricity supply (20)
properties through the database of -- Production halls
-- Mobile telephone subscribers (7) business properties,just fill out the
Source: World Economic Forum, Global Competitiveness Report 2008-2009 -- Technology centres
registration form which you will find on -- Science and technology parks
Investment Protection CzechInvest’s website together with
-- Office buildings and administrative facilities
Standard rate of corporate income tax instructions for completing it.
(%)
The Czech Republic is a member of the Multilateral Investment Guarantee Agency
(MIGA), an international organization for protection of investments, which is part of the
More than 100 Industrial Zones and Parks
35

30
World Bank-IMF group. The country has signed a number of bilateral treaties which
31
25
support and protect foreign investments, for example with the United States, Germany, Map of industrial zones supported since 1998
28
26 24 24 the UK, France, Austria, Switzerland, Italy, Belgium, Luxembourg, the Netherlands,
20
21
20
19
Finland, Norway, Denmark and China. The Czech Republic has also concluded 1 Klášterec nad Ohří 2 Žatec (2)* 3 Podbořany (2)* 4 Kadaň
15
agreements for the avoidance of double taxation. 5 Chomutov (2)* 6 Most 7 Bílina 8 Teplice 9 Přestanov 10 Rumburk
10 11 Liberec 12 Ústí nad Labem 13 Lovosice (2)* 14 Slaný 15 Louny
10 76
16 Kladno 17 Unhošť 18 Tuchlovice 19 Zdice 20 Žebrák 21 Plzeň
5 9 11
(2)* 22 Uherce 23 Stod 24 Blatná 25 Písek 26 Prachatice 8
7 12 39
0 27 Kamenice nad Lipou 28 Jihlava 29 Pelhřimov 30 Havlíčkův Brod 6 86
2003 2004 2005 2006 2007 2008 2009 2010 5 13
31 Zruč nad Sázavou 32 Velim 33 Kolín 34 Kutná Hora 35 Chrudim 1
4 38
14 83
36 Pardubice 37 Hradec Králové 38 Jičín (2)* 39 Vrchlabí 40 Kvasiny 2 15
41 Svitavy 42 Ždírec nad Doubravou 43 Žďár nad Sázavou 44 Velké 3 37 40
Source: CzechInvest, 2009 16 84
Meziříčí 45 Třebíč 46 Znojmo 47 Mikulov 48 Brno (2)* 49 Kuřim 18 17 61
Praha 33 36
50 Bystřice nad Pernštejnem 51 Moravská Třebová 52 Blansko 73
19 34 35 60
20 85 32
53 Vyškov (2)* 54 Hodonín 55 Staré Město 56 Brankovice 21 41 74
31 71 72
57 Prostějov 58 Litovel 59 Uničov 60 Šumperk 61 Krnov 22 42 51 59
63 75 70
62 Olomouc (3)* 63 Hranice 64 Valašské Meziříčí 65 Zlín 66 Vsetín 23 30 62 69 79 68
77 58 81
67 Kopřivnice 68 Třinec 69 Frýdek-Místek (2)* 70 Třanovice 24 43 50
29 49 52 57 67
64
71 Paskov 72 Český Těšín 73 Karviná 74 Ostrava (3)* 75 Mošnov 27 28 44 87 82 66
76 Hrádek nad Nisou 77 Domažlice 78 Český Krumlov 79 Nošovice 53 56
45 48 65
80 Pohořelice 81 Velká Bystřice 82 Holešov 83 Mladá Boleslav
25 46
84 Nymburk 85 Zlatníky 86 Trutnov 87 Velká Bíteš 80 55
26 47 54
** Number in brackets next to the names of municipalities represent the total 78
number of supported zones in the given location.

Source: CzechInvest, 2009

 14 3

International Memberships

Technical* graduates with tertiary education in Czech Technology Days

selected countries
The Czech Republic was the first CEE country to be admitted into the OECD. The country (% of tertiary bachelor and master graduates in 2006)
is a member of NATO and is fully integrated into other international organizations such as
The Czech Republic is very seriously involved in seeking out synergies in scientific and
the WTO, IMF, EBRD and WIPO (World Intellectual Property Organization). The Czech 25
technological development in cooperation with other developed countries in order to
Republic joined the EU on 1 May 2004. The Czech Republic has been a part of the 20 achieve much stronger and more efficient results of joint research and development
Schengen area since 21 December 2007. 19.7
15 projects, as well as programmes. Therefore, in 2005 the Czech ministries, together with
16.2 15.3
10 CzechInvest and other partners, established annual bilateral meetings called the Czech
12.6 12.6
Customs Obligations 5
11.3 8.8 8.6 Technology Days. For more information, please visit www.czechtechnologydays.org.
6.3 6.2
0
Japan Slovakia Germany UK Hungary
Starting on the first day of EU membership, routine customs checks of goods being Czech
Republic
France Belgium Poland USA
Favourable Labour Costs
moved across internal borders, i.e. the common border with other member states, were
*Engineering, manufacturing and construction graduates
abolished. Since the Czech Republic does not have an external EU border, routine Source: Education at a Glance, OECD indicators, 2008 One of the main attractions of the Czech economy is its skilled and well-educated workers
checks of goods being moved across the state border for customs and tax purposes are available at a fraction of the cost of those in western economies. Over the past five years
conducted only at the main international airports in Prague, Brno, Karlovy Vary and average annual wage has grown around 6-7% but it is coming from much lower base
Ostrava. Goods are freely transported across internal EU borders. Labour costs per hour in 2008
compared to Western Europe. Differences in remunerations among regions reach
USD
approx. 20%. Traditionally, employees in Prague are paid more than in other regions
(currently 25% above Czech average).
Visa Requirements 0 10 20 30 40 50

Czech Republic 14.44

EU member countries United States 25.52 Central Location in Europe and Advanced Infrastructure
The free movement of people has been agreed between all current EU member countries
United Kingdom 28.38
plus Norway, Iceland, Liechtenstein and Switzerland. This means the possibility of
France 31.61 The Czech Republic has a strategic location in the centre of Europe with very good access
working in all these countries without a visa or work permit. Since 1 May 2004, EU
to established western and emerging eastern markets. Prague is only a two-hour flight
citizens are allowed to stay and work in the Czech Republic without visas or work Belgium 39.32
from most other European capitals. The significance of the Czech Republic as a transit
permits. They are only required to register with the local office of the Foreigners’ Police. Germany 41.22 hub has grown since the Czech Republic became a member of the EU Single Market.The
road and motorway network (total 55,654 km) is already one of the densest in Central and
Non-EU countries
Source: The Economist Intelligence Unit, 2009
Eastern Europe and several rail modernization projects are currently underway to link the
Since 1 January 2009, an integrated residency and work permit (Green Card) system has
Czech Republic with the pan-European network of high-speed railways (total 9,588 km).
been in effect for employees from 12 non-EU/EEA countries. Citizens from these
countries can now apply for a Green Card when seeking work in the Czech Republic
instead of having to obtain a residency permit and work permit in separate proceedings.
Central location in Europe Infrastructure in the Czech Republic
The new Green Card process is much simpler and faster, with a maximum overall
processing time of 90 days.
Existing expressways Planned expressways Existing motorways Planned motorways

Leipzig Berlin
Berlin Hamburg
Wolfsburg
Y Wroclaw
AN Erfurt Gliwice
RM Děčín Liberec
Helsinki
Kassel PO
GE
Jablonec n. N.

Oslo Stockholm Teplice ÚSTÍ N. L.

Česká Lípa
Semily
LAN
Most Mladá
Trutnov
D
Chomutov Boleslav Jičín Náchod
Louny Mělník
Karlovy Vary Kladno HRADEC Jeseník Warsaw
Copenhagen Nymburk
KRÁLOVÉ
Bruntál
Dublin Würzburg Cheb
Sokolov Rakovník Kolín
PARDUBICE Ústí n. O. Šumperk Opava Bielsko
Amsterdam Frankfurt Beroun PRAGUE Karviná
Warsaw OSTRAVA - Biala
London Berlin Svitavy
Tachov PLZEŇ Benešov
OLOMOUC Frýdek Cracovie
Příbram Havlíčkův Místek
Brussels Brod Žďár n. S. Nový Jičín
Prostějov
Bratislava Přerov
Paris Munich Pelhřimov Kroměříž Vsetín
Domažlice
Vienna
Budapest Munich Klatovy Písek Tábor Jihlava
Blansko

Bern Ingolstadt Strakonice

Třebíč Vyškov Zlín Kosice
Stuttgart Jindřichův BRNO Uh. Hradiště Trnava
Milan Hradec
Marseille Istanbul Torino Prachatice
ČESKÉ
Hodonín
BUDĚJOVICE Znojmo
Lisbon Rome G Břeclav
Barcelona ER Český Krumlov

IA
Madrid
M

K
Athens
AN

VA
Vienna Bratislava
Y

O
Linz Györ

SL
Steyr AUSTRIA
Graz
Source: Road and Motorway Directorate of the Czech Republic, 2008
Source: CzechInvest, 2009
 Main Reasons to Invest Testimonials from Successful Investors
in the Czech Republic

Czech educational system meets the needs

-- Safe investment environment
of a competitive economy = 10 -- Skilled workforce
-- High share of secondary and tertiary education within the population
7 -- Favourable labour costs and price stability
6 -- Central location in Europe
6.26
5.94
5 5.61 -- Compact and high-quality infrastructure
5.22
4
5.06
4.58 4.56
-- Transparent system of investment incentives
4.49 4.32
3 3.6 -- Strong focus on R&D
2 -- Stable social and political system
1 -- EU membership
0 -- Mentality, culture and attitudes close to western countries
Netherlands Germany Czech United Hungary
Republic Kingdom Slovak -- Enviable life style
France USA Japan Poland Republic

Source: Institute for Management Development,

World Competitiveness Book, 2008 Well-educated and Skilled Workforce

Population that had attained at least upper secondary The Czech educational system meets the needs of a competitive economy, according
education in 2006
(% by age group 25-64) to the 2008 World Competitiveness Book published by the Institute for Management
Development. The Czech Republic can provide manufacturers with impressive
100
productivity levels and highly skilled labour. According to a 2008 OECD study, the
80 90 Czech Republic has a very strong position regarding the percentage of students
88
83 graduating in engineering, manufacturing and construction fields. In the year
60 69 68
67 67
2008/2009, there were approximately 67,000 technically orientated students at Czech
universities. The number of university students increased from 118,000 in 1990/91 to “How can we characterize the Czech software engineer? Based on my experience
40 369,619 in 2008/2009, due not only to changes in the education system but also to a working with international teams from China to the Bay Area, I can say that Czech
demographic bulge of 18-26-year-olds that represent a promising group of potential software engineers are as good as their western counterparts, regardless of whether we
20 employees for foreign investors. According to the last Eurobarometer survey 61% of look at innovation, efficiency, discipline, or experience, and they usually work harder. The
Czechs are able to speak at least one foreign language (predominantly English and roots of this healthy environment lie in the Czech Republic’s high-quality education
0
Czech United Germany UK OECD France Belgium German). system, which provides the heterogeneous skill sets of the country’s software engineers.”
Republic States Average Radovan Janecek, Chief Architect, BTO, HP Software R&D

Nine out of ten Czechs aged 18 to 59 speak at least one foreign language, and their
Source: Education at a Glance, OECD Indicators, 2008
knowledge is rapidly improving, according to a survey conducted by AUGUR “We are very pleased with our decision to locate our project in the Czech Republic. It is
Consulting for CzechInvest at the end of last year. The survey shows a 13% increase in a developed country and our Czech colleagues and employees are technically erudite,
Respondents able to participate in a conversation
language skills in comparison with the results of similar research conducted six years flexible and hardworking.”
in another language than their mother tongue Kim Eok-Jo, president, Hyundai Motor Manufacturing Czech
(%) ago.
70 “Lonza Kourim Czech Republic is the leading technology and manufacturing service
60 Proven Research and Development Capabilities provider for biopharmaceuticals in Eastern Europe.”
69 67 Stephan Borgas, CEO of Lonza
61
50
57 56 51
40 The Czech Republic spends more resources on research and development than many
42 “The Czech Republic offers a highly skilled and very efficient workforce with a strong,
30 of its competitor countries. Over the past ten years, the Czech Republic’s spending on
technically oriented educational background and a large number of engineering
20 R&D has increased from 0.95% of GDP to 1.42%. Many multinationals are running
graduates. The country has a rich industrial history and a university system that is highly
10 Czech R&D or design centres, including Panasonic, Honeywell, Mercedes-Benz,
recognized.”
0 Motorola, Rockwell Automation and Visteon. Czech scientists are behind some of the Jaroslav Dolezal, Honeywell National Executive for the Czech Republic
Finland Germany Czech Poland EU25 France Hungary
Republic world’s well-known discoveries and patents, such as soft contact lenses, polarography
– a Nobel-prize-winning method of quantitative analytical measurement, and the anti- “When Rolls-Royce made the decision to enter the Central and Eastern European market
Source: European Commission, Eurobarometer, 2006 HIV drugs cidofovir (Vistide®) and tenofovir (Viread®), to name but a few. in the mid 1990s, the Czech Republic was the natural choice. Prague had the
infrastructure and position that we needed for establishing our headquarters for Central
and Eastern Europe. Today, from Prague we manage our business in nineteen countries
across the territory, the business encompassing civil aerospace, defence aerospace,
marine and civil nuclear.”
Paul Kaye, Managing Director of Rolls-Royce Central and Eastern Europe
CzechInvest’s Services

Our Objectives:

-- To advise and support existing and new companies and foreign investors in the
Czech Republic
-- To support the competitiveness of the Czech economy
-- To create a space for communication between foreign investors, the state
administration and Czech companies

CzechInvest is exclusively authorized to file applications for investment incentives at

the competent governing bodies and prepares draft offers to grant investment
incentives. Its task is also to provide potential investors current data and information
on the business climate, investment environment and investment opportunities in the
Czech Republic.

CzechInvest’s Services

-- Comprehensive services for investors

-- Full information assistance
-- Handling of investment incentives
-- Access to structural funds
-- Business properties identification
-- Business infrastructure development
-- Supplier identification
-- Aftercare services

All of CzechInvest’s services are free of charge.

CzechInvest’s prestigious awards

-- Best Practices in Promotion 2004, presented by the steering committee of the

World Investment Forum
-- WAIPA Awards 2003 – Best Advertisement by an IPA (third place)
-- Best Investment Promotion Agency in the EU Accession Countries of 2002
-- European Investment Promotion Agency of the Year 2001
-- European Investment Promotion Agency of the Year 2000

CzechInvest, the Investment and Business Development Agency, is an agency of the Ministry
of Industry and Trade. Established in 1992, the agency contributes to attracting foreign
investment and developing domestic companies through its services and development
programmes. CzechInvest also promotes the Czech Republic abroad and acts as an
intermediary between the EU and small and medium-sized enterprises in implementing
structural funds in the Czech Republic. Our systems of quality management and information
security were certified by Quality Austria and Certification & Information Security Services in
accordance with ISO 9001:2000 and ISO 27001:2005.
 CzechInvest - Foreign Offices

UK & Ireland
USA - east Czech Republic
France Germany - Munich
USA - west
Japan

Southeast Asia

Association for Foreign Investment

Partnership to Support Foreign Direct Investment into the CR

...is a joint project of the Association for Foreign Investment and CzechInvest - the
Investment and Business Development Agency of the Czech Republic. The project is
intended for stable companies that offer highly competitive services and products and that
are interested in supporting the high-quality investment climate in the Czech Republic while
promoting the country abroad. Programme activities support, to the maximum degree
possible, communication between partners and foreign investors, Czech companies,
representatives of the state administration and AFI members by means of e.g. organising
prestigious award ceremonies, such as:

Contact us:

Association for Foreign Investment

Stepanska 11
120 00 Prague 2
Czech Republic

Phone: +420 224 911 750

E-mail: martin.michalov@afi.cz

More information on Association for Foreign Investment is available at www.afi.cz.

CZECHINVEST HEADQUARTERS
CZECH REPUBLIC
Stepanska 15,
120 00 Prague 2
PHONE: +420 296 342 500
FAX: +420 296 342 502
E-MAIL: fdi@czechinvest.org
www.czechinvest.org
CZECHINVEST WORLDWIDE
FRANCE
18, rue Bonaparte, Centre tchèque
F-75006 Paris
PHONE: +33 1 56 24 87 72
FAX: +33 1 56 24 8773
E-MAIL: paris@czechinvest.org
UK & IRELAND
1 Harley Street
W1G 9QD London
PHONE: +44 20 7291 4610
FAX: +44 20 7291 4612
E-MAIL: london@czechinvest.org
GERMANY - MUNICH
Feringastrasse 6
85774 München
PHONE: +49 899 9216 362
FAX: +49 89 9921 6366
E-MAIL: munich@czechinvest.org
CzechInvest Investment and Business Development Agency is a government organization under the Czech Ministry of Industry and Trade.
SOUTHEAST ASIA USA - EAST
89 Queensway, Admiralty 222 Merchandise Mart Plaza Suite 938
Room 2207-9 ; Tower II, Lippo Centre Chicago, IL 60654
Hong Kong PHONE: +1 312 245 0180
PHONE: +852 2530 8806 FAX: +1 312 245 0183
FAX: +852 2530 8136 E-MAIL: chicago@czechinvest.org
E-MAIL: southeast-asia@czechinvest.org
JAPAN USA - WEST
2-16-14 Hiroo, Shibuya-ku 440 N Wolfe Rd.
Czech Center 2F, Czech Embassy Sunnyvale, CA 94085
150-0012 Tokyo PHONE: +1 408 524 1690
PHONE: +81 3 3486 0329 E-MAIL: california@czechinvest.org
FAX: +81 3 3486 0328
E-MAIL: tokyo@czechinvest.org
This material is distributed free of charge.