The Czech Republic is one of the most stable and prosperous of the post-Communist states of Central Europe. Growth in 2000-2005 was supported by exports to the EU and a strong recovery of foreign and domestic investment. Domestic demand is playing an ever more important role in underpinning growth as interest rates remain low. Current account deficits of around 5% of GDP are beginning to decline as demand for Czech products in the European Union increases. Inflation is under control. Recent accession to the EU gives further impetus and direction to structural reform. Intensified restructuring among large enterprises, improvements in the financial sector, and effective use of available EU funds should strengthen output growth.

Key benefits in investing in the Czech Republic

There are several key benefits in investing in the Czech Republic, including the following:

• Low labour costs
  The government adjusts the minimum wage annually to correspond to changes in the consumer price index. The minimum wage is set at subsistence level; actual wages paid are much higher. The minimum wage is paid to only 2–3% of employees, according to the Ministry of Labour and Social Affairs, but it is important for calculating minimum bases for health-insurance and social-security contributions.
• Skilled workforce
  The Czech Republic has a highly skilled workforce, particularly in technology and engineering. Educational and literacy levels are high. Companies report few difficulties in recruiting skilled and unskilled workers, particularly in industrial areas where unemployment is highest.
• Central location
  The Czech Republic is conveniently located in the center of Europe.
• Access to EU markets
  With its recent membership to the EU, the Czech Republic is making many positive changes. The EU membership allows total free movement of capital, goods, people and services within the 25 EU member states. The Czech Republic is now becoming a major part of the European and global business environment.
• Investment incentives
  There are four main areas of public support programs offered by the state to potential investors:
  • Investment incentives for the manufacturing industry
  • Investment incentives for business support centres
  • Investment incentives for the development of technology centres
  • Job creation support program for regions badly affected by unemployment

  Learn more on the available investment incentives.