Business News


In Business News this week: Czech firms are putting a lot more money into research and development following a change to the tax system; FDI flowing into the Czech Republic falls by half; a group of MPs from the two biggest parties want the government to consider building two more nuclear power stations; a report predicts huge growth in the IT sector - but will companies be able to find skilled workers?; Skoda is planning to make its Superb a little more superb.

Investment in R&D increases after tax change

Czech firms have greatly increased their investment in research and development in the last two years, Hospodarske noviny reported this week. This follows a change in the law initiated two years ago by then deputy prime minister Martin Jahn, under which companies can deduct tax on expenses incurred in R and D. Spending on research and development in 2006 was almost one quarter higher than the previous year.

FDI inflow falls by half

The amount of foreign direct investment flowing into the Czech Republic fell by almost 50 percent last year, according to the World Investment Report by the UN Conference on Trade and Development. Whereas USD 11.7 billion in FDI flowed into the country in 2005, in 2006 that figure had fallen to 5.96 billion. Two years ago the Czech Republic was in the world top 20 in terms of FDI - last year it placed near 40th. The Czech Industry and Trade Ministry put the decline down to the fact that figures for 2005 were swelled by the privatisation of Cesky Telecom.

MPs pushing for new change in policy on nuclear power

A cross-party group of deputies is pushing for a rethink of the government's policy of discounting the idea of building more nuclear power stations. MPs from the largest party in the coalition the Civic Democrats and the opposition Social Democrats have joined forces to fight the no-new-nukes policy of the Greens, the smallest party in government. The informal group is calling for the construction of two more nuclear stations to go with the two already in existence, Temelin and Dukovany.

Hundreds of new firms expected in growing field of IT

Investment in information technology in the Czech Republic this year is set to reach CZK 93 billion (almost USD 5 billion), suggests a study by IDC quoted by Hospodarske noviny. It predicts that a whopping 700 new IT companies will be set up in this country in the next four years. Currently the sector employs over 150,000 people and the new companies will create another 50,000 jobs. However, employers complain the Czech education system does not produce enough skilled graduates in this field and they will have trouble finding suitable staff.

Skoda planning to launch new version of Superb...

Skoda Auto is redesigning its Superb model, according to recent press reports. The new design will be launched at the 2008 Geneva Motor Show and is set to go into production in the second half of next year. Skoda is also planning an estate version of the Superb. Both versions will be produced at the carmaker's newly expanded plant in Kvasiny, east Bohemia. Production of Skoda Auto's sports utility vehicle the Yeti will begin in 2009.

...while company continues to dominate Czech car market

Meanwhile, figures just out show that Skoda's Fabia is the top-selling passenger car in the Czech Republic. Almost 20,000 Fabias were sold in the period from January to the end of September. Second most popular was Skoda's Octavia, followed by the same company's Roomster.