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
President of the Republic of Lithuania Dalia Grybauskaitė welcomed the decision taken by the U.S. Government to transport shipments for the international mission in Afghanistan by transit via the Klaipėda Seaport.
more »
EU Solidarity Fund aid to repair storm damage in France and Portugal was approved by the Budgets Committee on Thursday.
more »
The European Investment Bank and the Government of Samoa formally agreed to support the rehabilitation and upgrade of independent water schemes in the Pacific island state under a EUR 250,000 technical assistance programme.
more »
Steps to overhaul the European Union's flagship single market were discussed on Tuesday (9 November) by MEPs and interested parties.
more »
Strategy to secure a sustainable EU energy supply and support economic growth over the next decade.
more »
EU funding to help 850 former workers in the aircraft maintenance industry around Dublin find new jobs was approved by the European Parliament on Thursday.
more »
Saffron farmers in western Afghanistan hope to oust opium as a harvest crop.
more »
The European Commission has approved an application from Poland for assistance from the European Globalisation adjustment Fund (EGF).
more »
New plans for EU industry to create jobs while keeping manufacturing in Europe.
more »
The European Commission has approved two applications from Spain for assistance from the EU Globalisation Adjustment Fund (EGF).
more »