The Czech Republic has benefitted in the recent years from being the biggest “pull” for foreign investors in Central Europe. But the city of Brno’s rejection of 2.7 billion-crown investment from Amazon has sent is a major setback for the country’s efforts to attract more investors into the country which will also soon be hampered by planned new EU rules likely to cut the maximum incentives that can be offered to foreign investors. In this week’s edition of Marketplace, the head of the government agency CzechInvest Ondřej Votruba discusses the Amazon
Czech exports to Ukraine dropped by 28.8 percent in February while exports to Russia registered an 0.4 percent in that month, the Czech Statistical Office said on Monday. Analysts see the Crimea crisis as the main reason behind the drop, as well as a slowdown of the Russian economy. Overall, Czech exports grew by over 15 percent in February, driven by trade with Germany, Austria, China, France, and other countries. A spokesman for the Exporters’ Association said Czech companies were concerned about an escalation of the crisis in Ukraine, adding that many expect lower volumes of new orders from their Russian business partners.
Russia’s Evraz sells Vítkovice steel works for 5.7 billion crowns
The Russian Evraz group has sold its Czech plant Vítkovice Steel. Its new owners, a group of investors including Martinley Holdings, Nabara Holdings, Vitect Services, Hayston Investments and Dawnaly Investments, paid 278 million US dollars, or over 5.7 billion Czech crowns, for the plant, a spokesman for Vítkovice Steel said, adding that the investors are planning to expand the company’s position as an independent player on the market with rolled products. With 1,100 employees, Vítkovice Steel is the Czech Republic’s third largest metalworking firm. It was acquired by the Evraz group in 2005 for 285 million dollars.
In recent years there has been a rise in the number of outdoor advertisements in Russian, English and other languages in the Czech Republic, to the annoyance of many locals. Now a new bill has been put forward regulating such ads. If passed, the legislation will allow local authorities to ban any foreign-language adverts displayed in public that are not accompanied by the same text in Czech.
Politicians in Brno have reacted with surprise to Amazon’s decision to drop plans to build a new distribution centre in the city. Deputy mayor Oliver Pospíšil, who on Tuesday had been insisting Amazon were still interested in investing in the project, said he had received no indications that the internet retailer was going to give up on the city. Mayor Roman Onderka said he would await an official letter from the company regarding its plans. Green Party representatives welcomed the news; they said the distribution centre would have caused congestion nearby, making life unpleasant for locals.
The US online retailer Amazon has dropped plans to build a large distribution centre outside Brno. The firm’s head of European operations, Tim Collins, told Czech TV on Wednesday the firm did not feel welcome in Brno whose councillors repeatedly voted against the project due to issues with the city’s zoning plan. Amazon was going to invest 2.7 billion crowns in the location, creating around 1,500 jobs. The firm is continuing with plans to build another distribution centre outside Prague. I spoke to Radek Špicar, vice president of the Czech Confederation
The internet retail giant Amazon has for now dropped plans to build a new distribution centre in the Czech Republic’s second city Brno. Amazon’s director of European operations Tim Collins told Czech journalists on Wednesday that the company was now considering other locations in central Europe. Councillors in Brno voted three times to reject an Amazon plan for a CZK 2.7 billion distribution centre in a local industrial zone; one argument against was that the Moravian capital’s current territorial plan did not allow for such a construction. The centre would have created 1,500 jobs.
Prime Minister Bohuslav Sobotka has urged Finance Minister Andrej Babiš, who has repeatedly come under fire for conflict of interests, to give up his business activities and concentrate solely on politics. Mr. Sobotka made the statement just hours after CDU MEP and member of the European Parliament's budget control committee, Ingeborg Grassle, brought up the subject at a press conference in Prague saying that Mr. Babiš as finance minister represented such a danger of conflicts of interests that in her opinion cooperation with Prague would be difficult. Mr. Babiš, whose firms have received 2.6 million euros from European funds, said he fully adhered to the conflict of interests law and was not actively involved in running a business but merely owned the Agrofert company.
In recent years, the Czech Republic has seen Russia as an increasingly important economic partner. Czech exports to Russia have grown tenfold over the past decade, and about 70 percent of Czech oil and gas imports come from that country. But the ongoing crisis in Crimea has highlighted the risks of the Czech economy’s exposure to Russia. In this edition of Panorama, I discuss the implications of the Crimea crisis for the Czech-Russian relations with deputy foreign minister Petr Drulák and commentator Erik Best. I first asked Mr Drulák to sum up
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“Einstein in Bohemia” – Part II: how alienation in ‘half-barbaric’ Prague led him to a new theory of gravity, eventual love of a free Czechoslovakia
“Einstein in Bohemia” – part 1: how a Prague sojourn sparked his theory of general relativity, journey of self-discovery