Czech PM: Czech Rep could be gateway for Chinese investment & business

In China on Tuesday the Czech prime minister, Jiri Paroubek, discussed future trade possibilities with his Chinese counterpart that included not only opportunities for well-known Czech firms, but also opportunities for Chinese companies here - in the Czech Republic. Mr Paroubek made clear he would like to see the Czech Republic become a gateway for Chinese businesses and investment within the EU.

Prime Minister Jiri Paroubek and his counterpart Wen Jiabao, photo: CTK

For a man who only entered office a few months ago Prime Minister Jiri Paroubek is nothing if not ambitious, oozing confidence this week in meetings with Chinese officials, including his counterpart Wen Jiabao. Clearly the Czech prime minister is confident the Czech Republic will be able to strengthen business ties with China, saying on Tuesday he had discussed a major Chinese investment in the area of electronics at home - namely the Changhong company's promised construction of a new factory to make TV sets.

Mr Paroubek qualified his meeting with the Chinese premier "a success", although he didn't offer further details.

Prime Minister Jiri Paroubek in China, photo: CTK

Creating new opportunities for Czech businesses in China is one aspect - a consortium of Czech firms like Skoda Praha and Skodaexport, for example, already operates in China in power plant construction - but getting China to invest here is another question. Mr Paroubek would also like to see more Chinese business open up in the Czech Republic and he used China's neighbour, Japan, as a model. There are more than 150 Japanese-financed companies here, with total investments said to be worth almost 3 billion dollars US. The advantage they share, of course, is a barrier-free gateway to the EU. Mr Paroubek clearly hopes that could be a trump card for the Czech Republic, which for the Chinese could become something of a "base". According to reports the Chinese prime minister expressed an interest in China investing in areas such as finance and the auto industry.

But, not everyone is convinced by Mr Paroubek's plan: some economists view the prime minister's offer as unrealistic, and others question the motives of some Chinese companies. They say there have been cases in the past of Chinese firms buying up companies and gutting them for know-how and technology, only to shut them down and reopen more cheaply at home. Protecting investments in both directions will depend on agreements that still have to be signed between the two countries.