Foreign direct investment in the Czech Republic, developments and trends
The Czech Republic offers an excellent environment to support investments with higher value added, i.e. investments that are technologically oriented or related to research and development, sometimes also referred to as high-tech investments, in key sectors (aerospace, automotive industry, life sciences, nanotechnology, ICT, business services, electronics and advanced engineering). In 2019, two-thirds of arranged investments were expansions of the operations of companies already established in the Czech Republic.
The change in the structure of foreign direct investment in the past ten years indicates a new trend in the Czech Republic. The number of demanding projects in the fields of research and development and business support services is rapidly increasing the number activities (technology centres and business support services centres) coming to the Czech Republic.
Other trends in the area of investment include autonomous driving, electromobility, virtual and augmented reality, cybersecurity, artificial intelligence and advanced materials.
| Selected key investors in the Czech Repblic by industrial sector | |||
| Sector | Investor (country/region of origin) |
Sector | Investor (country/region of origin) |
| Aerospace |
GE Aviation materials (US) |
High-tech mechanical engineering |
Bombardier (CA) |
| Honeywell Aerospace (US) | Daikin (JP) | ||
| Latecoere (FR) | Edwards (UK) | ||
| Bell Helicopters (US) | Ingersoll Rand (US) | ||
| UGMK (RU) | Siemens (DE) | ||
| Automotive | Hyundai (KR) | Information and communication technologies |
Microsoft (US) |
| Nexen Tire (KR) | Oracle (US) | ||
| Robert Bosch (DE) | Red Hat (US) | ||
| Toyota/Groupe PSA (JP/FR) | Solarwinds (US) | ||
| Volskwagen (DE) | Tieto (FI) | ||
| Business support services |
Accenture (US) | Life sciences | Lonza (CH) |
| DHL (DE) | MSD (US) | ||
| IBM (US) | Otsuka Pharmaceutical (JP) | ||
| Infosys (IN) | Synthon (NL) | ||
| SAP (DE) | Teva Pharmaceutical Industries (IL) | ||
| Electrical engineering and electronic |
ABB (CH) |
Nanotechnologies |
AGC (JP) |
| ThermoFisher Scientific (US) | Thermofisher Scientific (US) | ||
| Foxconn (TW) | Fibertex Nonwovens (DK) | ||
| On Semiconductor (US) | Saint-Gobain (FR) | ||
| Panasonic (JP) | Toray Industries (JP) | ||
| Source: CzechInvest, 2021 | |||
| Investment in individual years, 2010 - 2020 | |||
| Number of projects |
Investment (EUR mil.) |
Number of jobs |
|
| 2010 | 60 | 559 | 7,037 |
| 2011 | 72 | 1,262 | 10,702 |
| 2012 | 81 | 778 | 8,530 |
| 2013 | 108 | 1,832 | 10,412 |
|
2014 |
147 | 3,324 | 16,842 |
| 2015 | 106 | 1,719 | 14,040 |
| 2016 | 101 | 2,388 | 12,102 |
| 2017 | 106 | 2,408 | 12,116 |
| 2018 | 82 | 1,402 | 6,146 |
| 2019 | 94 | 2,090 | 6,948 |
| 2020 | 27 | 583 | 2,734 |
| Total | 984 | 18,345 | 107,609 |
| Source: CzechInvest, 2021 | |||
|
Structural change of investments |
|
1993 - 2000 Economic transition |
|
|
2000 - 2012 Greenfield investment in manufacturing |
|
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2012 - 2018 Diversification of supportes activities |
|
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2018 + Innovation |
|
| Top 6 investments, 1993 - 2020 | |||
| Investor | Sector | Country of origin |
Investment (EUR mil.) |
| Volskwagen | Motor-vehicle manufacturing |
Germany |
739 |
| Nemak | Motor-vehicle manufacturing |
Mexico | 443 |
| Denso | Motor-vehicle manufacturing |
Japan | 373 |
| Toyota/PSA | Motor-vehicle manufacturing |
Japan | 915 |
| Hyundai Motor Company | Motor-vehicle manufacturing |
South Korea | 1,341 |
| Nexen Tire Corporation | Rubber | South Korea | 887 |
| Source: CzechInvest, 2021 | |||
| Top 10 investment by country of origin, 2010 - 2020 | ||
| Country of origin |
Number of projects |
Investment (EUR mil.) |
|
Germany |
179 | 3,647 |
| Czech Republic | 228 | 3,397 |
| United States | 118 | 1,771 |
| South Korea | 19 | 1,311 |
| Netherlands | 41 | 1,230 |
| Austria | 36 | 1,113 |
| Japan | 56 | 952 |
| Switzerland | 45 | 543 |
| France | 31 | 457 |
| China | 22 | 441 |
| Total | 775 | 14,862 |
| Source: CzechInvest, 2021 | ||
| Top 10 investment by sector, 2010 - 2020 | ||
| Sector | Number of projects |
Investment (EUR mil.) |
| Motor-vehicle manufacturing | 243 | 5,536 |
| Rubber and plastics | 87 | 2,286 |
| Metalworking and metal-processing | 118 | 1,987 |
| Paper and wood-processing | 38 | 1,588 |
| Mechanical engineering (machinery manufacturing) |
98 | 1,233 |
| Food | 41 | 831 |
| Electric devices (batteries, generators, cables, appliances) |
30 | 690 |
| Other | 49 | 675 |
| IT and software development | 71 | 206 |
| Electronics (computers, optical instruments, electronics) |
30 | 638 |
| Total | 805 | 15,670 |
| Source: CzechInvest, 2021 | ||