Business News

American airline looking into LET Kunovice

The US regional airline Pan Pacific Airways have hinted they may be interested in salvaging the ailing Czech company LET Kunovice.

LET are the largest producer of passenger aircraft in the Czech Republic, although in recent years the fortunes of the company have plummetted. The company has recently been plagued by threats of bankruptcy and even closure.

Not that that seems to have dampened the enthusiasm of Pan Pacific Airways President Randall Brink. Brink told the Prague Post: "Our interest is based on a respect and appreciation for the [LET] aircraft designs, the LET people, and the quality of the LET aircraft product line."

Brink gave a few details of the possible LET revitalisation plan; it would include replacing the existing management with one committed to a capitalisation plan. He also rather controversially stated that Pan Pacific would discontinue LET's Load Master project, currently flavour-of-the-month with the present owners.

Czech Rep. and South Africa sign trade agreement

Trade relations between the Czech Republic and South Africa look set to receive a timely boost. South African Deputy President Jacub Zuma, on a visit to Prague, and Czech Finance Minister Pavel Mertlik have signed an agreement aimed at increasing trade and enhancing economic relations.

The agreement will establish respective trade representations in the two countries. Zuma also held discussions with both Premier Milos Zeman and President Vaclav Havel centring on trade issues and cultural exchanges.

The Czech Republic imported just over 200 million crowns worth of South African goods in the first half of last year. One major investor is the brewery giant South African Breweries. SAB are one of the largest brewing groups in the world and now control 45 percent of the Czech market, including such labels as Radegast, Velke Popovice and Plzensky Prazdroj.

Czechs attract record FDI

The Czech Republic and Poland attracted record levels of Foreign Direct Investment by transnational corporations in 1999, according to a report published this week by the UN Information Centre.

The figures emulate the global trend, and FDIs are expected to surpass the one-trillion-dollar level--that's a one and 12 zeros--during the year 2000. The Czech Republic recorded a figure of $16 billion during by the end of 1999, only 1 billion lower than the whole of the Russian Federation.

Quite surprising figures, considering that traditionally political crises in Central and Eastern Europe have a knock-on damaging effect on the whole of the region's foreign investment. The Chechen and Kosovo crises have failed to curtail the FDI figures. So, does this mean that the Czech Republic is finally forging a more independent investment environment? Earlier this week I spoke to Andreas Jahn of CzechInvest? Not so fast with that Olomouc Olympic bid, though. As always, a competitive environment is paramount. Martin Janish works for the UN Information Centre here in Prague: According to Martin Jahn, though, the statistics are giving too much credit to Hungary and Poland. Policies such as including foreign participation in the second privatization wave mean that the Czech Republic could soon outstrip her Central European neighbors:

Danish rejection of Euro won't change EU expansion policy

The EU Enlargement Commissioner, Guenter Verheugan, said last week that the Danish rejection of the Euro wouldn't be allowed to upset the EU's enlargement plans.

There were words of warning too. Verheugan insisted the whole enlargement process remains unchanged, and that applicant countries, the Czech Republic included, wouldn't be allowed to choose permanent exceptions to membership requirements. "Our strategy is not to allow a Europe a la carte," the Commissioner said.

Strahov camp takes huge losses

And finally, Tomas Doubek, the entrepreneur who established the camp city to accommodate the anti-IMF/World Bank demonstrators, is claiming he's a ruined man. Only 1,200 of the expected 15,000 protesters actually checked in to the camp, set up in the gigantic Strahov Stadium. "We have huge losses," said Doubek, "about 250,000 Kc from the Ya Basta group alone. We were happy they paid anything!"