Forewords

Over the past few years, time seems to have accelerated. Changes in the world are putting us to ever more serious tests. The Covid-19 pandemic reminded us of the importance of innovation and robust economy in a changing world. Putin’s war on the West has left Europe facing an energy crisis that is strangling our economy and threatening our future. 

It is absolutely clear now that no European state can afford to be dependent on unpredictable third parties. National and European energy sovereignty must become our main objective. That is why the Czech Republic has made it a priority to fundamentally transform our energy sector. At the same time, we are moving towards a higher value economy. This requires major investments in our infrastructure and a series of key changes in the areas of education, innovation, and strategic support for new sectors such as electromobility. 

All these objectives have one ultimate goal: not just to survive this crisis but to get through it as a more resilient country. A better place to live and do business. As a free and open economy in the heart of Europe, we can only achieve this in partnership with companies that choose to invest here. The government of the Czech Republic is therefore committed to make investing here easier and more attractive. 

What I wrote in the previous edition of this yearbook still holds true: together, we will emerge from this crisis stronger and more competitive than ever. 

I have the greatest pleasure of bringing you already the eighth edition of the Business Guidebook.  We have chosen a new motto for this year: Czech Republic – Back to Heart of Europe.  

This title probably best describes the period after the retreat of the Covid 19 pandemic, when supply chains were disrupted. Many companies are returning from Asia back to the Czech Republic. And our country is undoubtedly the imaginary heart of Europa with its traditions and skilled workforce. In today's uncertain times, it is an ideal place for investment. 

This guidebook is a very special publication, as it provides substantive and sought-after help to international investors and their advisors searching for the most suitable place for investments globally and in Europe in particular. We present contributions of leading experts and institutions in each of their respective fields in the Czech Republic.  

The Czech Republic is the destination in heart of Europe that provides an ideal mix of good return on investment, reasonable costs, strong ideas, potential for future development, superb human capital and an enthusiastic working environment. We place strong emphasis on investments being sustainable for both Czech and global societies. All that even in times of major changes and challenges. The coronavirus crisis and the war in Ukraine have changed the world, but this event has also shown how we need to think about opportunities, which are there for taking. Investment in the Czech Republic is such opportunity.   

The next two years will bring about a restart of investment activity and our country will be at the forefront of it. Our well-educated people, institutional and political stability, excellent access to major European markets, safe environment, and high quality of living – none of that has disappeared, nor will any of it disappear any time soon. All of these factors will still be here to ensure a stable return on your existing or future investment, which is something that you may not see in many other countries. Also, at this time of expected deglobalisation of supply chains, the Czech Republic ticks all of the boxes as a target for new investment within the EU.  

Europe needs more reinvestment on the continent and there are few places that are better suited for that than the Czech Republic. Vast sums of money will be spent on recycling and other parts of the circular economy, investment in energy independence and new energy sources, as well as in modern technology in general.  

And I wish to highlight one particular area. The European Green Deal policy is changing as you read this article, but it is here to stay and will have a massive impact on our economy. There are many fields where investing in the Czech Republic may start a continent-wide venture utilising the Green Deal challenges. 

For all of these reasons, I remain optimistic about our future and your future with us as well. Our Association for Foreign Investment will be here to help you succeed, working hand in hand with our institutional partners including CzechInvest, the Ministry of Industry and Trade and the Ministry of Foreign Affairs. 

Finally, I would like to thank everyone who played a role in creating this publication. We highly value your support.  

I am convinced that this unique guidebook (and its sister platform, www.czechbusinessguide.com) will serve as a trustworthy source of information that you find useful in your strategic decision-making. We will welcome your feedback, opinions, and suggestions on how to improve it. Please get back to me at kamil.blazek@afi.cz with any ideas or comments you may have regarding this guidebook, or the topics covered or not covered in it. 

Kamil Blažek 

Chairman, Association for Foreign Investment  

Situated in the heart of Europe, Czechia has been a prosperous country throughout its modern history. As a developed country with an open, trade-oriented economy, Czechia is one of the thirty most advanced and competitive countries in the world, with an excellent position in the index of economic freedom. It is also the eigtht safest country in the world. Having an effective legal environment, healthy banking system and stable political culture, Czechia is the sixth most complex economy in the world, which provides you with favourable conditions for investments.  

Our country’s accessions to the EU, NATO and the OECD are undoubtedly important historical milestones on our path to democracy. At the end of the last year, we have symbolically closed the door behind a successful presidency of the Council of the European Union. All these events have had a significantly positive impact on the Czech economic development and have shaped Czechia’s position in relation to other countries.  

However, as important as it is to remind ourselves of our history and celebrate milestones, it is essential, especially with respect to investments, to focus on the future. Even though the Russian aggression in Ukraine and the energy crisis as its consequence have affected Czechia and its economy, we can still rely on our modern export-oriented economy. Our companies focus on modern technologies, R&D and innovations in the long term. Our main goals include cultivation of an effective start-up environment, innovation centres, smart investments, digitalisation of the public sector and more, all while profiting from the most industrialised environment in the EU. Regarding the energy crisis, our key step on the way to recovery are structural changes in the field of renewable sources of energy that will require further investments. Furthermore, we want to take advantage of our ongoing tradition of manufacturing, advances in innovation, open investment climate and advantageous location in Central Europe. Our economic diplomacy builds on qualities such as scientific potential and advanced research, well-developed industry, favourable accessibility and highly skilled people in various fields of industry. 

Based on estimates for 2023, Czechia should continue to maintain the status of a country with favourable macroeconomic stability. For this year, Czech economy is expected to maintain on the same level as the previous year with the prospects of a 3.5% growth in upcoming years. Not even our country could avoid a slight increase in unemployment. However, it still keeps the lowest rate in the EU of around 2.7%. In terms of world trade, Czechia confirmed last year its position as an eminent world exporter based on the world trade rankings, where it was ranked as the 28th largest exporter and 29th largest importer of products worldwide. The Czech share in total exports is also remarkable, reaching 1.0% despite the fact that Czechia is a small country with only 0.13% of the world's population. 

Even though the aforementioned qualities draw a certain picture of the Czech economy, potential foreign investors need to analyse further many different variables before investing. Keeping this in mind, Czech economic diplomacy has undergone progressive development while interconnecting the work of governmental and non-governmental actors, employing diverse instruments, working on new strategies and supporting Czech companies inside and outside the borders of our country. This collaborative environment has shaped Czechia into one of the most successful transition economies in terms of attracting foreign direct investments. On behalf of the Ministry of Foreign Affairs, I highly appreciate all of the activities and initiatives that the AFI, CzechInvest and other institutions are taking on to support companies based in Czechia. I thank you for your devoted work and wish you a lot of success in the upcoming years.  

Jiří Kozák 
Deputy Minister of Foreign Affairs