Foreign investment activities shifting from industry to technology and services
Published:
1 January 2004 y., Thursday
Although this country has become a favorite with foreign investors seeking to build production plants in Central Europe, experts say this trend is currently undergoing a dramatic change.
Instead of car plants and smoke-belching factories, they say, in the near future the Czech Republic will become a haven for foreign companies hoping to expand in the technology and services sectors.
In the last six months, investor interest has become increasingly focused on two sectors besides the traditional engineering and manufacturing fields: technology, media and telecoms; and health care/pharmaceuticals, according to research by Deloitte & Touche.
Potential investors in these sectors are attracted for the same reasons as industrial investors: a skilled and low-cost labor force, a prime location in the middle of Europe and an improving economy. DHL, one of the world's largest logistics companies, plans to invest 500 million euros (16 billion Kc/$615 million) over five years in a new data center in Prague. The company has already started constructing the building and will launch trial operations in May. The center will employ 400 workers at first, a total that in two years will rise to 1,000.
The company decided to move its IT operations from Britain and Switzerland to Prague because of this country's skilled and cheaper work force, as well as the nation's developed infrastructure, said DHL general director Stephen McGuckin. Labor costs in the Czech Republic are only 40 percent of those in Western European countries.
U.S. oil giant ExxonMobil will follow DHL's lead and build an administrative center in Prague to service its European operations. The center will open next April with 300 employees. Although the company has not officially announced the move, local recruiters have already started their search for IT specialists and finance staff.
DHL and ExxonMobil are not the only companies importing tech services. Indian IT firm Infosys is considering entering the Czech market in 2004. The company is mulling opening a center in Brno through a daughter company. The center would provide Infosys' services to European firms. The potential volume of the investment and the number of jobs it would create have not been made public.
Šaltinis:
The Prague Post
Copying, publishing, announcing any information from the News.lt portal without written permission of News.lt editorial office is prohibited.
The most popular articles
European Commission Vice-President Siim Kallas, responsible for transport, today presented to the College a preliminary assessment of the economic consequences for the air transport industry of the volcanic ash crisis.
more »
Boosting economic recovery, investing in Europe's youth and in tomorrow's infrastructures are the priorities of the 2011 draft budget adopted by the Commission on 27 April 2010.
more »
European Competition Commissioner Joaquín Almunia welcomes proposed commitments by Visa Europe to significantly cut its multilateral interchange fees (MIFs) for debit card payments.
more »
Because of the Icelandic volcano, flower growers in Colombia couldn't get their stems to markets in Europe.
more »
The Second Vice President of the Spanish government and Minister of Economy and Finance, Elena Salgado, on Sunday played down the importance of apparent fissures within the EU concerning the Greek financial crisis, expressing her confidence that all countries would support the aid package for this country, which will be accompanied by a tough budget-tightening plan.
more »
Commission launches an information campaign on the CE conformity mark - designed to ease the free movement of goods around Europe and protect consumers.
more »
If Europe's airports ever open again the introduction of new security measures like body scanners will be expensive.
more »
After Eurozone Finance Ministers agreed measures to address Greece’s financial woes last Sunday, MEPs quizzed leading economic figures, including the chairman of Goldman Sachs - former financial advisors to the Greek government - on how to strengthen EU economic governance and improve reporting of national statistics.
more »
The European Tourism Stakeholders Conference, being held in Madrid today and tomorrow, will explore ways and means to strengthen the visibility of tourism at a European level and to verify how the actions to promote a competitive EU tourism industry.
more »
The European Bank for Reconstruction and Development (EBRD), World Bank Group member IFC, and The Netherlands Development Finance Company (FMO) have joined up with the Asia Debt Management Hong Kong (ADM Capital) to establish a regional fund to invest in midsize companies facing financing difficulties as a result of the financial crisis.
more »