1Czech Republic Market Overview and Opportunities March 2013

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Market Overview and Opportunities

general presentation update March 2013

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Czech Republic in Europe

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Map of Czech Republic

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Czech Republic: basic facts

£ 4.2bn (2011)UK Imports

£ 1.8bn (2011)UK Exports

20,400 USD (IMF) GDP per head

Brno, Ostrava, Plzeň, OlomoucMajor Cities

Prague, population 1.2 millionCapital

78,900 sq. km; 30,500 sq. miles Area

10.5 millionPopulation

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Czech Republic: basic facts

Member of:

NATO, EU (since 2004), OECD, UN, IMF, WTO, Council of Europe

Highly developed industrial base:

Manufacturing and engineering, mining, automotive, electronics,

construction, machinery, metallurgy, glass manufacture, production

of beverages (beer)

Intensive growth in the service sector

Working population of 5.3m, well educated and skilled workforce

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Czech Republic: basic facts

British investment reached more than Eur2bn since early 90’

Major investors: Vodafone, Tesco, Logica, Rolls Royce

CEE Headquarters: Mott MacDonald, BAE Systems, M&S, Rolls

Royce, Allen & Overy

Financial services: HSBC, RBS, Provident Financial

Retail: M&S, Karen Millen, TM Lewin, Next, Mothercare, Top Shop,

Body Shop, Tie Rack, Debenhams

Luxury brands: Burberry, Jimmy Choo, Barker, Agent Provocateur

Over 300 British companies present in the market

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Czech Republic: more basic facts

GDP Growth 2011 1.7% (EIA, CNB)

GDP Growth forecast 2013 1.0% (EIA)

Unemployment 6.8% (October 2012) (Eurostat)

Inflation 3.4% (October 2012)

Gross wage average CZK 24,626 (October 2012)

Exchange rate to £ CZK 31.406 (CNB 1st November 2012)

FDI (2011) 3.8bn EUR (CNB)

FDI total until end Sep 2012 106bn EUR

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Czech RepublicPolitical situation

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Czech RepublicCzech Industry

• Generates 30% of GDP and employment (1.3 million)• 50% of production depends on exports• Key branches

– Production of automotive vehicles and related production (rubber and plastics)

– Production and distribution of electricity, gas, heat and climatised air

– Production of metal structures and metalworking including machinery and equipment

– Production of other non-metal mineral products (linked to construction)

– Production of food– Production of basic metals, metallurgy, casting– Production of ICT, electronics and optical devices

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Czech RepublicOpportunities

PRIORITY SECTORS

• Power

• Science & Technology/Innovation (ICRC, CEITEC, ELI)

• Food & Drink

• Consumer Goods – luxury and high street brands

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Czech RepublicOpportunities Market Entry

Sales

• Direct

• Distributor (Agent)

Investment

• Local manufacture

• Branch/Subsidiary

• Partnership/Joint venture

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Czech RepublicBusiness Culture

• Liberal/sophisticated market

• British products good reputation

Welcome face to face

• Confirm language of meeting/if in doubt, use an interpreter

• Confirm objectives of meeting

• Relaxed

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Czech RepublicUKTI Team Prague

• Over 500 companies can’t be wrong!

• Strong collaboration with other colleagues in Central Europe e.g.

regional

market reports, regional events, Regional Director

• Good relationship with Czech Government and other partners

• Work closely with the British Chamber of Commerce

(www.britishchamber.cz)

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Czech RepublicSummary

• Much closer than BRIC/ Excellent strategic location

• Very strong history of innovation, entrepreneurs, productivity, engineering

and industrial tradition

• Access to EU structural funds

• Natural crossroads between East & West

• Anglophile; British products & investment well received

• Well educated, skilled & still relatively low cost workforce

• English widely spoken

• EU member

• Many business opportunities

• It's close...