Prague, Czech Republic – The Czech Republic is the second most attractive country in Central and Eastern Europe, according to a survey by the Czech-German Chamber of Commerce and Industry.
Estonia and Czech Republic most attractive CEE economies
Scoring particularly well in “productivity and motivation of employees”, “academic training” and “quality and accessibility of local suppliers”, the Czech Republic moved up one place compared to last year’s study, overtaking neighbouring Poland, and is second only to Estonia, which foreign investors have named as the most attractive country in the region to do business in.
The Czech Republic previously held the title as the most attractive economy in Central and Eastern Europe for several years in a row, before being surpassed by Estonia in 2019.
Poland completes this year’s podium, followed by Slovenia (4th), Slovakia (5th), Latvia (6th), Lithuania (7th), Croatia (8th), Romania (9th) and Hungary (10th).
A majority of companies (60%) continue to cite the shortage of skilled workers as a crucial hurdle and their biggest challenge to do business in the Czech Republic during the next 12 months. Most businesses expect a rise in their turnover (55%), while around a third of them are expecting an increase of their exports, investments and employee workforce in the near future.
Digitization and political stability cited as main shortcomings
Despite good indicators on the Czech economic performance, the impact of the pandemic is clear: only 15% of companies in the service industry rate the current economic situation as “good”, compared to around two-thirds of them in the manufacturing sector.
Contrary to previous years, where labour costs were cited as one of the biggest challenges, most companies (87%) established in the Czech Republic anticipate no or only minor pressure on wage growth, another impact of the economic slowdown caused by the coronavirus crisis.
On the downside, the Czech Republic recorded the lowest score in digitization of its public administration, and reported the largest drop in “political and social stability” – which should serve as a warning, according to the authors of the study.
The survey is carried out annually by the Czech-German Chamber of Commerce and Industry (DTIHK) in 16 CEE countries with more than 1,300 companies. For more information, you can find the complete results (in German) here.