Study: Czech Republic best country in Europe in which to expand production
Among all the states in the EU, the Czech Republic has the most favorable conditions for the expansion of production, according to the annual Manufacturing Risk Index from real estate consultants Cushman & Wakefield, cited by the Czech News Agency.
The Czech Republic ranks fourth in the world after China, the United States and India in this regard, climbing from fifth last year.
According to the authors of the report, the Czech Republic’s high placing is chiefly thanks to its level of risk, excellent location and low operating costs.
The ability to restart after the coronavirus crisis was evaluated in the 2020 edition of the study and in this regard also the country received a positive assessment.
Since 2016, when the country was first included in the Cushman & Wakefield ranking, it has figured highly among suitable destinations for manufacturing companies looking to base their operations.
The company’s Ferdinand Hlobil said the fact the Czech Republic had long been among those states regarded as a good location for manufacturing represented positive news for the Czech economy.
Mr. Hlobil attributed the high placing to the Czech Republic’s strategic position in the heart of Europe, good transport infrastructure, advanced business, economic and political environment with a low level of risk, and relatively low labour, energy and construction costs.
With regard to risk assessment, the Czech Republic took seventh place in the global ranking, down from fourth last year. In the EU it was bettered only by Germany, which came in fourth.
On top of the regular criteria, this time out the report also focused on countries’ ability to recover from the coronavirus crisis. In this respect the Czech Republic was included in the second quarter of states best prepared for a restart. This meant it was in the same bracket as Canada, the US and – among European states – Austria, the United Kingdom and Sweden.
The Czechs fared better here than other countries in the region, such as Poland and Hungary, who were ranked in the third quarter of states by Cushman & Wakefield.
The crisis caused by the coronavirus pandemic has highlighted the pitfalls of global connectivity, the property experts’ Ferdinand Hlobil said.
Returning production to original countries may seem like a logical solution but this is not realistic on a large scale, he said. To boost their resilience in case of another wave of the pandemic, manufacturers are focusing on how to ensure supplies of materials or components are not interrupted.
At present, only a few companies are considering relocating production to Europe in order to reduce their dependence on Asian countries.
However, if they do so, said Mr. Hlobil, the Czech Republic is well-placed to attract their interest thanks to its highly suitable conditions, which have not been greatly impacted by the coronavirus crisis.