Number 1/2009

Are CFOs from Mars and CIOs from Venus?AFI Insights

12-13

American invest-ment and the potential for the Czech RepublicCountry Focus

24-25

Data centres & green ITSpotlight on Project

10-11

4-9

18-19

Moravia-Silesia:a region of many contrasts and opportunitiesRegion Focus

Investment in the Czech Republic in 2008Hot Topic

Welcome to the Czech e-RepublicBusiness Climate

Czech cuisine: an exceptional mix of tastesLiving Czech

20-21

22-23

32

CZECH F CUSM a g a z i n e o f t h e A s s o c i a t i o n f o r F o r e i g n I n v e s t m e n t

The Czech Republic: Europe's top location for ICTSector Focus

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1

INVESTOR’S CALENDAR

May - July 2009 May 5. - 7.5. CzechOpenDays inLuxembourg2009 Luxembourg,Luxembourg Conference

18. - 21.5. BIO2009 Atlanta,Georgia,USA Conference

19. - 20.5. NeueFördergelderfür nvestitioneninCEE/SEE Vienna,Austria Seminar

June 2. - 4.6. Czech-FinnishTechnology Days2009 Helsinki,Finland Seminar

9.6. InvestiereninTschechien Bremen,Germany Seminar

15. - 16.6. GartnerOutsourcing &ITServicesSummit London,UK Conference

15. - 21.6. LeBourget Paris,France Tradefair

25.6. Swissmem–Industrietag Zurich,Switzerland Seminar

July 1. - 3.7. BioExpoJapan Tokyo,Japan Tradefair

>> Foreword

DearReader,

The Czech economy is feeling theimpact of the global economic crisis.The prognoses forwhen itmight end aremostlyonlypropheciestakenfromacrystalball,butitcanbasicallybesaidthatwhenwebounceback from thedepthsof this crisisdoesnotdependonlyonus,butmainlyonsurroundingcountries.Themarketeconomygrowsincycles.When

theeconomicdownturnbeganin2007,itap-pearedinthehousingbubbleunderpinnedbytheAmericansub-primemortgagesector.Wehopedthatthebubblewouldsimplydeflateashadbeenthecaseinmanypreviousinstances.Instead, it burst andbroughton the greatesteconomiccrisissincethe1930s.The current crisis differs from past reces-

sions inseveralrespects.Primarily, it isglobaland thus no country can fully escape it. Sec-ondly, it has adversely affected the absolutemajority of sectors. Thirdly, themassive saleofstate-ownedsharesinbankswilltakemuchlongerthanexpected.ThefinancialcrisisdidnotaffecttheCzech

Republicuntilautumnlastyear. Inan interna-tional comparison, our banks were in muchbetterconditionthanotherbankstothewestofus.Weareoneofa fewOECDcountrieswherethegovernmentdidnothavetorescuethebanks.Wehavealwaysemphasisedthatwecould

notrealisticallyavoidtheeconomiccrisis.Be-causewehaveasmall,openeconomydepend-entonexports,thecrisisinsurroundingcoun-triesisimpactingtheCzechRepublic.At the beginning of January, Prime Minis-

terMirekTopolánek introduced theNationalEconomic Council (NEC), of which I am amember.Mostofusareatthedisposaloftherepublic,notonlyofthegovernment,thoughthegovernmentassuredusthatourworkhasapurposeandthatourresultsareuseful.

At its secondmeeting, the NEC trimmeddownmorethan250originalproposalsonthemost fundamentalareasandtheresultwasa26-pointrevitalisationprogramme.Itwasimportantthatwenotdothingsthat

wewouldregret later.Therefore,wealwaysaskedwhether the steps that we are takingwouldbereasonableintimesofnormality.Themeasuresarefocusedprimarilyonthe

transparency of credit mechanisms, promo-tionofemploymentandsupportforthebusi-nessenvironment.Wearealsopromotingtheflexibilityof the labourmarketandreductionofsocial-securitycontributions,whichhaslongbeendiscussedinprofessionalcircles.From the beginningwewanted to formu-

late strong fiscal-stimulus packages, thoughconversely the aimwas to provide relief forentrepreneurs and firms during this difficulttime.Accelerationofdepreciationisanimpor-tantproposalthatwillnotoverburdenthestatebudget.Theresultofthefirstphaseofourworkwas

apackage,acombinationofthesupplyandde-mandsidesoftheeconomy,thatwouldnotsig-nificantlyencumbertheCzechnationalbudget.TheresultingNECpackage isacompromiseofpeoplewithdifferingopinionsbutalsowithmutualrespect.From the beginning, it was clear that we

would not be able to avoid foreign-policythemesandinternationaleconomicpolicy.Notonly is itnecessarytotakeintoconsiderationtheaimsoftheanti-crisisplansinthesurround-ingcountriesandothersignificantworldecon-omies,butwemustalsokeep theEuropeanagendainmind.Innocasewewishtoendupintheroleoffreeloaderswhoareonlyalongfortheride.Nevertheless,justasoureconomyhasitsownspecificnature,somustouranti-crisismeasures.AtthebeginningofAprilthesuccessfulG20

summitwasheldinLondonandtheNEChadspecificrecommendationsfortheapproachoftheCzechgovernmentrepresentingtheEuro-peanUnion.Westillhavea lotofworktodo.Compa-

nieswillcontinuetolayoffworkers; industrywillberestructured.Inspiteofthis,however,Iremainoptimistic.Myidealconsistsinactiveandresponsiblepeople.Beingunemployed isunpleasantforanyoneandparticularlyforthepoor. I believe, however, thatmanyof thosewho lose their jobs will find the courage tostarttheirownbusinesses.Thusitisnecessaryforourcountrytohaveanopenandfavourablebusinessenvironment. I believe thatmanyoftheNEC’sproposalswillcontributetoachiev-ingthisgoal.Itisoffundamentalimportancethattheeco-

nomic crisis does not become a social crisis.IamfirmlyconvincedthatthiswillnothappenintheCzechRepublic.

Czech FocusquarterlyPrague1/2009, 5 May 2009MK ČR E 18872Association for Foreign InvestmentŠtěpánská 11120 00, Prague 263835339

Title:Publication periodicity:Place of issue: Number and date of issue: Ref. no.:Publisher:

Identification No.:

Tomáš SedláčekMember of the National Economic Counciland Chief Macroeconomic Strategist, ČSOB

2 >> Quarter in Review

Headline news February 2009 Last year the Czech Republicattracted213investmentprojectsworthCZK30billionwiththeassistanceofCzechInvest.Investorsundertooktocreate14,606new jobs.Themostfrequentinvestorsweredomesticcompanies,fol-lowedbyGerman,Dutch,andSouthKoreancom-panies.More information on investments in 2008 is available in the Hot Topic section of this issue of Czech Focus.

April 2009TheCzechgovernmentledbyMirekTopoláneklostano-confidencevoteattheendofMarch.Ninety-sevenofthe197membersofpar-liament present voted against themeasure. ThegovernmentsubsequentlyresignedandinAprilthecoalitionagreedontheformationofanewcare-takergovernmentledbyJanFisher,chairmanoftheCzechStatisticalOffice.AnewcabinetshouldbenamedbythebeginningofMayandwill functionuntilearlyelectionsplannedforautumn.

April 2009AtthebeginningofAprilAmericanPresidentBarackObamavisitedtheCzechRepub-lic.ToanenthusiasticcrowdatPrague’sHradčanskénáměstí,hedeliveredaspeechemphasisinglibertyandnucleardisarmament,andlaterparticipatedintheEU-USsecuritysummit.

Politics and Legislation February 2009 The government adopted theNationalAnti-CrisisPlanpresentedbytheNationalEconomicCouncil.Themaingoaloftheplanistotempertheincreaseinunemploymentandtosus-tainthestabilityofpublicfinances.Forexample,thegovernment has approved a reduction of social-securitycontributionsand fasterpropertydepre-ciation,andhasalsopushedforthedevelopmentofscienceandresearchandsupportforresidentialconstruction.

March 2009TheEuropeanCommissionhasap-provedthreesupportprogrammestoacquireandrefurbishrailcars,municipaltransportvehicles,andregionaltransportvehiclesintheCzechRepublic.Subsidies,whichwilltaketheformofdirectinvest-mentcontributions,willgotocompaniescreatedbypublicbodiesandcompaniesthatprovidepublictransportservices.

March 2009TheMinistry of Industry and Trade has issued asecondcallforinvestment-aidapplicationsaspartoftheOperationalProgrammeEnterpriseandIn-novation. Investmentaid in thiscase involves theprovisionoffavourableloans,whichcantotaluptoCZK20million,thoughnomorethan75%oftheexpectedprojectexpenditures.

April 2009TheCzechRepublicsuspendedissu-anceofworkandbusinessvisasinMoldova,Mon-golia,Thailand,UkraineandVietnam.TheCzechauthorities decided to implement this measure,

which will last several weeksbutwillnotaffecttouristvisas,duetotheimpactsoftheeco-nomiccrisis.

Economy February 2009 The inter-national ratings agency Stand-ard&Poor’sstatesinitslatestreportthattheCzechRepublicwill most likely deal with thecrisisbetterthanmostEasternEuropean countries. Resilientconsumer demand and rela-tively strong economic foun-dations will supposedly help.Conversely,accordingtoasur-vey conducted by the CzechChamberofCommerce,near-ly50%ofdomesticcompanieshavelaidofforwilllayoffsomeoftheiremployees.

March 2009 Robert Hol-man, director and boardmemberoftheCzechNation-alBank,statedthatthecentralbankwill negatively adjust itsforecastof thedecline in thecountry‘sgrossdomesticproduct.ThebankhaspredictedGDPtototal0.3%.HolmanestimatesthatGDPwillfallbyonetotwopercent.

April 2009Accordingtoananalysisconductedby investment bank Goldman Sachs (GS), theCzech crown will be the strongest currency inEasternEuropeinthecoming12months.Afterabriefdropinthecomingthreemonthsitshould,ac-cordingtoGS,remainatCZK25.50totheeuro.

April 2009TheaverageunemploymentrateintheCzechRepublicroseto7.7%(from7.4%inFebruary).AccordingtotheMinistryofLabourandSocial Affairs, 448,912 people are currently job-less.April 2009Accordingtoastudyconductedbythe consulting company DTZ, there is currently555,000 m2 of available industrial space in theCzech Republic. More than half of all industrialprojectsare locatednear thecapital (roughly1.5millionm2).Atotalof72,700m2wererentedoutinthefirstquarterofthisyear,down40%ontheprecedingquarter.Inay/ycomparison,thisrepre-sentsadropof60%.

Business February 2009Magna InternationalofCanada, the thirdbig-gest global producer of automotive compo-nents, is entering the Czech Republic. ThecompanyispurchasingtheLiberec-basedfirmCadenceInnovation,amanufacturerofplastic

parts,withthreefactoriesintheCzechRepub-licandoneinHungary.

February 2009FromAugustthisyearreagentsforbiotechnologyresearchwillbeproducedbyA2Z Bio, the Czech subsidiary of the Britishfirm Yorkshire Bioscience, at the ČKD PragueTechnological InnovationCentre.ThecompanywillinvestEUR100,000inthefirstphaseoftheproject.

February 2009BroseCZisplanningtobuildafactoryinTrutnovtoproducecomponentsfortheautomotiveindustry.

February 2009Elmarco,aglobalmanufacturerofmachinesforproducingnanofibres,hasopenedanewcentreforresearch,developmentandpro-duction.Thefacilitycovers3,000m2andistheonlyoneofitskindintheworld.Thecostsofconstruct-ingandequippingthisuniquecentreofnanofibretechnologyamountedtoCZK190million.

February 2009 The holding company Lesshasbuilt inČáslav the largestEuropeanplant forprocessingthemostmassivepartsoftreesatacostofCZK1.8billion,makingitthebiggestinvestmentinthissectortodate.

February 2009 The domestic banking sec-torrecordedanetprofitofCZK45.7billion for2008. Česká spořitelna had the highest profit(CZK 15.8 billion), followed by Komerční banka(CZK13.2billion).

At the beginning of April US President Barack Obama visited the Czech Republic.

3>> Quarter in Review

April 2009 In February exports of road ve-hiclesandcomponentsfromtheCzechRepub-

lic fell 29% to CZK27.35billion.Exportsof cars from theCzechRepublicwereaffectedbythe intro-duction of so-calledliquidation subsidiesinEUcountries.MiscellaneousFebruary 2009 The Czech Repub-lic hosted the 2009Nordic World SkiC h a m p i o n s h i p ,which took place inthe second half ofFebruary in the Lib-erecregionofnorth-ern Bohemia. Thetotalcostoforganis-ingthechampionshipamounted to CZK2billion.

March 2009AccordingtotheWorldPeaceIndexcompiledbytheorganisationVisionofHu-manityandcovering140nations,theCzechRe-publicistheworld’sseventeenthsafestcountry.Iceland,Denmark andNorway top the index,while the lowestranking include Iraq,Somalia,SudanandAfghanistan.

March 2009 Last year the Czech Republicrankedasthefourthlargestexporterofelectric-ity among the states of the European commonmarket.NetexportsofelectricityfromtheCzechRepublictotalled11.5billionkWh.Thelargestex-porterwasFrance.

March 2009TheCzechRepublicistheclearleader among the 12 new EU member stateswhenitcomestotheuseofsolarenergy.Attheendof 2008photovoltaic plantswith an outputof62.2MWwereinoperationintheregion;theCzechRepublicaccountedfor88%(54.7MW)ofthistotal.

April 2009CzechAirlineshasbeennamedtheBestAirlineinCentralEuropeintheagencySky-trax’sWorldAirlineAwardsforthethirdtimeinarow.Withintheawardssurvey,theservicesofindividualairlinesfromaroundtheworldareas-sessedbypassengers.

Sources:Czech Information Agency, Česká tisková kancelář,

MF Dnes, Právo, Lidové noviny, Hospodářské noviny, E15, Profit, Euro, Czech Business Weekly, iHNed.cz,

Aktualne.cz , Novinky.cz , iDnes.cz , MediaFax, Revers.

trepreneursareatthistimeinterestedinfixingelectricitypricesfornextyear.Accordingtothechamber, companiesshould accept thecurrent offer beingmade by the ČEZgroup,whichisoffer-ing a 15% reductionof the price of base-load electricity start-inginJanuary2010.

March 2009Plasma TV manufac-turerHitachi has an-nounced the closureof its plant locatedin theTriangle Indus-trialZonenearŽatec.This is primarily dueto a global reductionin interest in plasmatelevisions and theresulting decline insalesearnings.April 2009DongheeCzech isplanningtoexpandpro-duction of chassis parts and fuel tanks forthe automobile industry in Český Těšín.The companywants to implement this plan

in Juneand to in-crease its staff by120to300andin-troduce a secondshift.

April 2009The Czech soft-ware companyBohemia Interac-tive transferredits developmentteam from Aus-tralia back toPrague.Theteamis responsible fordeveloping thenext generationof the company’smilitary trainingsimulator VirtualBattlespace.

April 2009The Czech com-pany Alta andrepresentat ives

of Magnitogorskij Metalurgickij Kombinat(MMK)havesignedacontract for therefur-bishmentofequipmentandconstructionofarollingmillatacostofUSD440million(CZK8.7billion).

February 2009MicrosoftisplanningtoopenitssecondMicrosoftInnovationCentreintheCzechRepublic.Thecentre,whichshouldbeestablishedinHradecKrálové,willhavethepurposeofassist-ingstart-upcomputerfirms.

February 2009TherestaurantchainHootersofAmericaannouncedplanstoentertheCzechmarketthroughfranchising.

February 2009 The transportation companyStudentAgencywillexpanditscooperationwiththeFrenchcompanyKeolisandenterintoregion-altraintransportaswellasexpress-trainroutes.TheLiberecregionwillbethefirsttobenefitfromtheexpandedservices.

March 2009ThisyearPardubice-basedSynpowillbeginoperatinganewresearchanddevelop-mentcentre,atwhichitwillproducenanoparti-cles for use in paint systems in the automotive,construction,anddefenceindustries.

March 2009 Thanks to a subsidy from theEuropeanUnion,aspecializedcentrefocusingonresearchingtheuseofgeothermalenergytopro-duce electricity and heat in theCzechRepublicwillbeestablishedinNorthBohemia.TheentireprojectwillcostEUR78million(roughlyCZK2.1billion),whichwillbecoveredbytheOperationalProgrammeR&DforInnovation.

March 2009AccordingtoasurveyconductedbyIncomaResearch,therewere246 hypermarketswith a sales areaof 1.16 million m2in operation in theCzechRepublicatthebeginning of 2009.The turnover of allstores of this formatexceeded CZK 141billionlastyear.

March 2009It was announcedthat the breweryStarobrnowillmergewithKrálovskýPivo-varKrušovice,whichis currently its soleshareholder. Thesole shareholderof the successorcompany, KrálovskýPivovarKrušovice,isAustrianBrauUnion.Straro-brnohasbeenpartofHeinekensince2003.

March 2009AccordingtotheCzechCham-berofCommerce,46.3%ofcompaniesanden-

The government adopted the Na-tional Anti-Crisis Plan presented by the National Economic Council.

4 >> Sector Focus

TheCzechRepublichasemergedasEu-rope’stoplocationforoffshoringandout-sourcing of IT services. Repeatedly rec-ognized by various researchers, this factisconfirmedbythestronginflowofhigh-value-addedprojectsoftheworld’stopITcompaniesandisfuelledbythecountry’straditionofexcellenceintechnicalfields.In2006and2007,newprojectsofMicro-

soft(DevelopmentCentreforMobileTech-nologies), Skype (ApplicationDevelopmentCentre, the first outside the company’shome country), CSC (ITCentre for Euro-

peanClients),DeutscheBörseandRedHat(Software Development Centres) wereaddedtothe listofalreadysuccessfullyes-tablishedcentresinthecountry.Also,com-panies such as SunMicrosystems,MonsterTechnologies, Acision and Infosys have of-ficially announcedexpansionsbasedon thesuccessoftheiroperationsinthecountry.Last year CzechInvest, the Investment

and Business Development Agency oftheCzech Republic, helpedmediate 43newITinvestmentsfortheCzechRepub-lic. “Today IT comprises one of the key

componentsoftheCzecheconomy–lastyear ICT companies prepared the larg-estnumberofnew investments inwhichCzechInvestparticipated,surpassingeventhe traditional champions – the automo-tive and engineering industries,” saysAlexandra Rudysarova,CEOofCzechIn-vest.Manyinterestingprojectswerelaunched

in2008andtheplansofcompanies(eithernewcomersoralreadyestablishedplayersexpanding their activities) are promising.Such plans involve, for example, the Ex-

In today’s society modern Information and Communication Technologies (ICT) are considered to be a decisive factor in economic and social development. This is in large part due

to the fact that such technologies make it possible to overcome the obstacles of distance and unfavourable geographical location. The dynamism of development and the scope

of operation show that they play an indispensable role in society.

The Czech Republic:

Europe's top location for ICT

Illustrative photo

5>> Sector Focus

pert and Solution Centre of Suse Linux,whichfocusesonprovidingspecialistsup-port for installation and use of Novellsoftware products, HSBC Bank’s newproject involving the establishmentof anApplications and Software DevelopmentCentre within its existing shared-servic-es centre in Ostrava, and the Software-DevelopmentCentreofSolarwindsSoft-wareEuropeLimitedinBrno.TheCzechRepublic’s advantages in the IT field alsoprompted the American software giantIBMtochoosePragueasthelocationforits regional headquarters, from whichit will direct its activities in Central andEasternEurope.ITcompaniesarebecomingincreasingly

interested in the Czech Republic. “Thetrend is obvious – the number of com-panies that approach us asking formore

information about the Czech Republic isgrowing year by year,” stresses Rudysa-rová. “Interestingly,wecanactuallyben-efitfromthecurrenteconomicdownturnascompaniesareforcedtoseekthemostcost-effectivesolutionsandtheCzechRe-public,withitsgreatlocationinthemiddleofEuropecoupledwithtalentedprogram-mersandwagesthatarestillconsiderablylower compared to most old EU coun-tries, is thecountryofchoice formany.”According to theCzechStatisticalOfficetherearecurrentlyabout100,000CzechsemployedinIT,makingthesectoroneofthelargestemployersinthecountry.Furthermore,ITcompanieswithCzech

originsarerenownedworldwidefortheirproducts,suchasantivirussoftwarefromAVG Technologies and Alwil (Avast!)protecting millions of computers world-wide, integrated security solutions fromKerio, advanced communication systemsfrom2NTelekomunikace,consultingandtechnology services provided by Logos(acquired by Ness Technologies in June2008) and comprehensive services andsolutions in development and implemen-tationofenterpriseapplicationsandinfor-mationsystemsprovidedbyUnicorn,thebiggestCzech software company,whosechairman,VladimírKovář,won thepres-tigioustitleEntrepreneuroftheYear2008intheCzechRepublic.DespitebeingoneofthemostmatureITmarketsinthere-gion,theCzechRepublicstilloffersplentyof growth potential and CzechInvest isreadytoprovidepotential investorswithcomprehensivesupport,duringtheentireinvestment decision-making and imple-mentationprocess,inordertoreducetheburden on their management resources,especially inmatters such as location se-lection, information support, matchmak-ing,supplieridentificationandsoon.

Ideal location for company headquartersManyorganizationsthatchoosetomove

IT services to lower-cost countries aredauntedbythetaskofdeterminingwhichcountrywouldbesthosttheiroperations.ThankstoitslocationinthecentreofEu-rope,theCzechRepublicisagatewaytoboth eastern and western markets. TheCzechRepublic is lessthantwohoursbyairfrommostEuropeandestinations.The Czech Republic fares well against

other Eastern European countries as asuitablesiteforoffshoreoutsourcing.Thecountry’s well-developed education sys-tem can serve as a basis for future skillsdevelopment and produces a very capa-ble workforce while contributing to the

growing maturity of advanced industrialsectors. The country’s cultural compat-ibilityalsoplaysanimportantrole.Another positive aspect of the Czech

Republicisitshighlivingstandard,thankstowhichitisnotdifficultforinvestorstopersuadekeyemployeestorelocatetothecountry,wheretheywillfindanextensiveand safe transportationnetwork andwillnot have a problem communicatingwiththe locals inat leastoneworld language.ThisisoneofthereasonsthatfirmssuchasIBM,AdobeandDHLruntheirCentralEuropeanoperationsfromPrague.

“The Czech Republic is a suitable site for offshore outsourcing; it is highly rated in terms of political and economic stability, cultural compatibility and security.”

Gartner Analysis of the Czech Republic as

an Offshore Services Location, (2008).

ICT-related Education – The Basis of Future Skills Development TheCzech Republic combines an out-

standing level of general education withstrongscienceandengineeringdisciplines.ForgenerationstheCzecheducationsys-tem has generated high-level technicalproblem-solving skills in environmentswherestandardsolutionsareinadequate.TheCzecheducationsystemhasavery

strongpositioninuppersecondaryeduca-tion, which serves as the foundation foradvancedlearningandtrainingopportuni-ties,aswellaspreparationfordirecten-tryintothelabourmarket.Anabundantsupplyofuniversitygradu-

atesassurescontinuousreplenishmentofthe country’s available labourpool. Pub-lic universities offer programmes rangingfrom ICTandelectronics to life sciencesandhumanities,whileanumberofprivateinstitutionsoffermainlybusinessadminis-tration or economics studies. Universityeducation is generally focused to meettheneedsofacompetitiveeconomyandthecooperationbetweenuniversitiesandthecorporatesectorhasbeenexpandinginrecentyears.Overall, therearenearly350,000studentsat25publicand39pri-vateuniversitiesandcollegesintheCzechRepublic.The Czech Republic offers a large

numberofskilledtechnicalworkers.Thecountryhastraditionallybeenverystrongintechnicalfieldsandapproximatelyone-third of all university graduates have atechnical degree. There are currently

The Czech Republic:

Europe's top location for ICT

6 >> Sector Focus

more than 73,000 technical-universitystudentsandstudentswhostudytechnicalsubjects at other universities.More than13,000 university graduates in technicaland scientific subjects enter the work-forceevery year.University students areengaged in R&Dof various technologies,giving themexposure to these technolo-gies and contributing to the quality ofgraduates.

Workforce – Skills are the critical factor for success in this sector Costsplayasubstantialrole indeciding

where to locate and operate a business.ThecontinuinggrowthoftheCzechecon-omy and investment by companies andstateinstitutionsininformationtechnologyhasspurredaneverincreasingdemandforexperienced IT specialists. For the third

consecutive year this demand is growingmarkedly faster than the number of spe-cialistsseekingjobsintheITsector.The result of this is that the IT sector

has highest average level of wages amongall professions in theCzechRepublic.Thehighestwagegrowthin2007wasprimarilyamonggraduatesandspecialistswithuptothreeyears’experience,whoweremostindemandintheITmarket.Thewageamountalwaysdependsonthe

levelofeducation,specializationandlengthofexperience,aswellasonthesizeofthegiven company. Bonuses commonly com-priseasignificantwagecomponentinsalesandproject-managementpositions,aswellasinthemajorityofmanagementpositions.Nevertheless,oneofthemainattractions

oftheCzecheconomyremainsitsskilledandwell-educatedworkers available at a “frac-

tionof thecost”of those inotherwesterneconomies.Thetableshows(page8)acom-parisonofsalariesofITspecialistsintheUnit-edStatesin2007andthesalariespaidforthesamepositionsintheCzechRepublic.

The Czech property market is increasingly attractive for foreign investors The amount of office space in the Czech

Republicisgrowingsteadilywhiletheavailabil-ityof space forproduction facilitieshasbeenboosted by amajor government programmedesigned to support the construction anddevelopment of industrial zones, brownfieldregeneration anddevelopmentof speculativebuildings, andpremises forR&Dand shared-servicescentres.Anincreasingnumberoflargeinternational andCzech property developersareactivelyseekingsitesfornewindustrial,lo-gisticsandbusinessparks.

Science and Technology ParksScience and technology parks facilitate

cooperation between universities, re-search institutesand innovativefirmsandthus act as abridgebetween the scienceand business spheres. Thanks to the in-volvementofuniversitiesandresearchin-stitutes,ascienceandtechnologyparkcanoffer firms specialized advisory and con-sultingservices,mediatevaluablecontactsandoffercustomresearchservices.Firmscanusethepark’sofficeequipment,meet-ing and conference spaces, laboratoriesandworkshops.Thekeybenefitofscienceand technology parks is the presence ofadvancedcompaniesthatareabletohelpotherfirmsgrowandprosper.Thanks to the Prosperity Programme,

the Czech Republic is now home to an

ICT students and graduates on selected universities 2007/2008

KARLOVYVARY

CzechTechnicalUniversityinPragueStudents:5601Graduates:1359

TechnicalUniversityofLiberecStudents:1133Graduates:168

UniversityofHradecKraloveStudents:1342Graduates:401

UniversityofWestBohemiaStudents:2632Graduates:876

CharlesUniversityStudents:1363Graduates:515

UniversityofEconomicsStudents:2077Graduates:371

UniversityofPardubiceStudents:1719Graduates:503

TechnicalUniversityofOstravaStudents:3985Graduates:502

TomasBataUniversityStudents:851Graduates:318

MasarykUniversityStudents:2315Graduates:296

BrnoUniversityofTechnologyStudents:6644Graduates:1359

USTINADLABEM

LIBEREC

PRAGUE

PLZEN

CESKEBUDEJOVICE

HRADECKRALOVE

PARDUBICE

JIHLAVA

OLOMOUC

BRNO

ZLIN

OSTRAVA

Source: Institute for Information on Education, 2008

7>> Sector Focus

expansivenetworkoffacilitiesprovidingtop-quality infrastructure formodern innovativecompaniesinvolvedprimarilyinresearchanddevelopment.In comparison with other regions of the

Czech Republic, incubation activities inSouthMoraviaareaboveaverage.Moraviaisknownforitsuniversities,experiencedcerti-fied suppliers, qualityworkforce and exten-siveopportunities for investors.Scienceandtechnology parks that have recently openedoutsidetheSouthMoraviaregionincludetheHradecKrálovéScienceandTechnologyPark,whosepurposeistoprovidequalityfacilitiesfor developing the region’s commercial ac-tivities.Another is theMstětice Science andTechnologyPark,whichwillofferfacilitiesfordevelopers, scientists and start-up firms in

the area of transportation technologies andrelatedfields.

ICT in the RegionsThemost important regions in the Czech

Republic fromtheICTpointofviewarecer-tainly Prague, South Moravia and Moravia-Silesia. Many IT companies have already ex-ploitedtheidealconditionstosetupsoftwaredevelopmentcentresorregionalheadquartersfor CEE operations. The biggest impact thatthishashadisonthelabourmarket,whichisalmostsaturatedintheseareas,thusmakingitdifficulttofindworkers.However,theeffectsof the financial crisis have recently broughtabout a slight improvement in the situation.Intheaforementionedregionstherehasbeenahugetransferofknowledgeinthepastcou-

ple of years and nowadaysmany profession-ally trained and highly skilled engineers andmanagers are working on different projects.There are many emerging regions suitablefor new ICTprojects in theCzechRepublic,mainly Plzen, Liberec, Hradec Králové, Par-dubiceandZlín,whoselocaluniversitieshavea long traditionof technical education. In re-centyears,numerousscienceandtechnologyparkshavebeenestablishednearuniversities,smallandmedium-sized ICTcompanieshavejoinedclustersandlargeinternationalanddo-mesticcompaniesshownincreasinginterestinexploiting the opportunities related to thesedevelopments.

Jan Fried,CzechInvest

Companies’ investments in information technologies have

been rising since 2005 and last year was no exception. This

has ledtorelativelyhighdemandfor ITspecialists,particularly

programmers,analysts,projectmanagers,salespeopleandcon-

sultants. In2008werecordedaslightdecline inwagesamong

graduates and, conversely, wage growth among experienced

workers,which is the result of an effort to preclude the exit

of these specialists.At the endof 2008 therewas a slight yet

notabledecreaseof investmentsand thusadecline indemand

for new employees on the part of ICT companies. Belowwe

presentthemainspecificsandwagetrendsinindividualITfields

andprofessions:

SOFTWAREDEVELOPMENT

ThemosthighlydemandedspecialisationsremainJAVA,C#/.

netandC++.Monthlysalariesamong junioremployeesare in

therangeofCZK25,000,i.e.CZK5,000lessthanintheprevious

year. Conversely, the salaries of experienced senior program-

mers/systemarchitectsat theupperwage limit increasedbyat

leastCZK10,000.

In the case of junior web programmers (HTML, JavaScript,

PHP,etc.)wagesdidnot increase lastyear,but ratherdeclined

onaveragetoCZK22,000.PHPremainsamongthemostin-de-

mandtechnologies.Seniorwebprogrammers’top-scalesalaries

increasedbyroughly20%.

Othertechnologies(Visualbasic,DelphiandABAP)recorded

aslightdecline,asthereisminimumdemandforthem,withcor-

respondingwageratesforspecialistsinthesetechnologies.

Thepercentageofcompaniesthatrequireactiveknowledgeof

Englishinadditiontotechnicalknowledgeisincreasing.

The salaries of development-team leaders with up to three

years’experiencebarelyincreased,byapproximatelyCZK3,000

–5,000monthly.Specialistswithlongerexperience(fiveormore

years)didnotseeanywageincrease.

SYSTEMADMINISTRATORS

Companies’demandforUNIXsystemadministrators increasedwith

correspondinggrowthinwagesforthesepositionsofCZK2,000–5,000

permonthonaverage.

ThepositionofMSadministratorrequiresatleastoneyearofexperi-

enceinthefield,thoughmostcompaniesprefermoreexperience.How-

ever,thisnolongappliesinthecaseofUNIXsystemadministrators, in

whichcasefreshgraduatesareofferedjobopportunities.Amongjunior

employeesinHelpdesk/HW-technicianpositions(secondary-schoolgrad-

uateswithoutexperience,universitystudents),wecontinuetoseemonth-

lysalariesunderCZK20,000.Wagesofexperiencedworkersincreased

by10%onaverage.Theseemployeesadvancetoadministratorpositions

afterfiveyearsatthelatest.

TELECOMMUNICATIONSANDNETWORKS

Demandforuniversitygraduatesgraduallydeclinedin2008.Wagesfor

thesepositionsdecreasedbyanaverageof20%.

Specialistsfocusedonnetworktechnologieswithcertification(CCNA,

CCNP,CCIE)continuetobebettercompensatedfortheirwork.

MANAGEMET

Projectmanagerscontinuetobethemostin-demandemployeesinthis

category.Unlikeinpreviousyears,supplyanddemandwerebalancedin

2008,resulting inanegligiblewage increaseofCZK5,000onaverage.

Incomparisonwithpreviousyears,weagainnoticedatrendofreduced

averagewagesamonginexperiencedspecialists.

CONSULTANTSANDANALYSTS

Amongjunioranalysts,therewasnotablegrowthintop-scalewages.

Conversely,theupperlimitofsalariesamongsenioranalystsdecreasedby

CZK6,000.Thesepositionsrequirecertificationandtrainingfocusedon

Microsoft,SAP,SiebelandITIL.

Testerjobsremainentry-levelpositionsforsecondary-schoolgraduates

oruniversitystudentsandgraduates.

Main specifics and wage trends in individual IT fields and professions in the Czech Republic

8 >> Sector Focus

Position 0-1 year experience 1-3 years experience 3-5 years experience 5 or more years experienceTeamleader - 45000-55000 50000-70000 60000-90000ProgrammerC++ 25000-30000 30000-45000 40000-60000 50000-70000ProgrammerJAVA,J2EE 25000-30000 35000-48000 45000-60000 53000-90000ProgrammerC#,.net 25000-30000 32000-48000 43000-60000 50000-80000ProgrammerHTML,PHP 22000-28000 25000-40000 35000-50000 40000-60000ProgrammerVB,Delphi 25000-30000 30000-40000 35000-45000 40000-50000ProgrammerPL/SQL 25000-30000 32000-45000 40000-55000 50000-70000ProgrammerABAP 25000-30000 30000-45000 45000-55000 50000-60000

SOFTWARE DEVELOPMENT

Position 0-1 year xperience 1-3 years experience 3-5 years experience 5 or more years experienceDirector,CEO - - - 100000-250000ITmanager,CIO - - 50000-100000 80000-150000Projectmanager - 40000-60000 50000-85000 70000-140000Securitymanager,CSO - - - 70000-130000

MANAGEMENT

Position 0-1 year experience 1-3 years experience 3-5 years experience 5 or more years experienceAdministratorMS - 25000-43000 35000-50000 45000-65000AdministratorUNIX 23000-28000 30000-45000 45000-55000 50000-75000Applicationadministrator/ERP 22000-25000 25000-45000 45000-50000 50000-65000Databaseadministrator 25000-28000 30000-40000 40000-50000 50000-60000Helpdesk/HWtechnician 18000-25000 25000-30000 30000-35000 -

SYSTEM ADMINISTRATOR

Position 0-1 year experience 1-3 years experience 3-5 years experience 5 or more years experienceAnalyst 25000-32000 30000-43000 40000-62000 40000-74000Tester/Qualityengineer 22000-28000 30000-44000 35000-55000 50000-65000Systemconsultant(MS,UNIX) - 30000-45000 40000-55000 55000-65000ConsultantERP,CRM,MIS,DMS,ITIL

- 30000-50000 40000-80000 60000-100000

Safetyconsultant - 30000-45000 40000-75000 60000-90000Technicalwriter 20000-25000 25000-30000 30000-40000 40000-50000

CONSULTANTS

Position 0-1 year experience 1-3 years experience 3-5 years experience 5 or more years experienceTelecommuni-cationsspecialist 20000-25000 30000-45000 35000-52000 45000-65000AdministratorLAN/WAN 22000-28000 25000-40000 30000-45000 35000-50000Networkconsultant - 30000-40000 40000-55000 50000-75000

TELECOMMUNICATION AND NETWORK

Position CR min. CZK/month USA min. CZK/month CR max. CZK/month USA max. CZK/monthProgrammerJAVA 25000 117000 90000 182000Teamleader 45000 147000 90000 200000AdministratorMS 25000 92000 65000 144000ITmanager 50000 230000 150000 378000Projectmanager 40000 137000 140000 200000Qualityengineer 22000 98000 65000 142000Helpdesk 18000 65000 35000 85000Analyst 25000 118000 74000 163000

WAGE COMPARISON, CR-USA

Source: Salary & Benefits Guide 2008/2009, Robert Half International

Source: Salary & Benefits Guide 2008/2009, Robert Half International

9>> Sector Focus

What do Hewlett-Packard, IBM, CA, RedHat, Novell, or Sun Microsystems have in com-mon? Among many other things, they are involved in significant enterprise software-product research and development (R&D) in the Czech Republic. Why? Cheap labor? Routine tasks such as software test-ing or debugging? Actually, the situation is quite the opposite. HP Software conducts strategic R&D for its SOA products. Sun Microsystem’s Czech branch has grown into an operation employing several hundred en-gineers and has become one of the few global R&D sites of the company that created to Java. CA has established a large R&D team to bring its mainframe technologies into the future. Novell’s grand plans with SUSE Linux have relied on Prague’s R&D team since the very beginning.

Other “new” international firms linked to the era of internet star-tups, such as eBay and Skype, have established their R&D cent-ers here when seeking out new engineering talent. Google employs Czech engineers in Krakow and Zurich. We must also mention origi-nal Czech startups like Grisoft (recently renamed AVG technologies) of the famous AVG anti-virus software and Compelson Labs, the maker of the hugely successful MobilEdit software for cell phones. Systinet is a startup that delivered the first commercial web services toolkit and was acquired by Mercury Interactive. Illusion Softworks has created a brand known to everybody who plays computer games. Prague-based JetBrains has started a new era of software refactor-ing. Good Data is bringing a completely new approach to the busi-ness intelligence market. In addition, the Czech Republic is among the top ten countries contributing to Linux Kernel development. This is just to name few Czech firms selling software worldwide.

Nevertheless, this picture is incomplete. We cannot forget the very dynamic market of software solutions and consulting, whether these are outsourced from abroad, as in the case of LogicaCMG, or provided by original Czech companies such as Unicorn, which has revenues exceeding CZK 1 billion. These two giants are accompa-nied by numerous smaller consulting firms that are also doing quite well on the market.

Another important market segment for software engineers is driv-en by large international corporations establishing IT centres here. DHL, Deutsche Börse, and CSC Corporation together employ hun-dreds of engineers in the Czech Republic. Of no less importance, the Czech Internet community is extremely vital. The list of successful Internet startups in the Czech Republic is very long, as an example we can take the highly successful Seznam.cz, which is the country’s leading search engine, even outstripping Google in terms of popular-ity on the local market.

In summary, the Czech software-development market is a mature environment offering many opportunities ranging from the adventure of establishing a software startup to working on enterprise software products having a global impact.

The roots of this healthy environment lie in the Czech Republic’s high-quality education system, which provides the heterogeneous skill sets of the country’s software engineers. The Faculty of Math-ematics and Physics at Charles University is geared more toward math and computer science. Technical universities in Prague and Brno turn out developers with extensive knowledge of hardware or specific areas such as telecommunications or computer graphics. The country’s economic universities provide project management-oriented education focusing on the economic, social, and process aspects of software development. The Czech Academy of Sciences offers yet another avenue of learning for students interested in tech-nical fields. Courses led by the Academy’s scientists have tradition-ally been seen as the nation’s finest study opportunities. Finally, in the Internet age, anybody can have access to all needed information beyond what any university can offer in its curriculum.

Although collaboration between academia and industry has not been a strength of our education system, the situation has improved significantly in the past decade, especially since the Czech Republic entered the European Union. In any case, good developers usually exit universities with two or three years of experience working in commercial companies in parallel with their studies, which gives them a very important head start.

How can we characterize the Czech software engineer? Based on my experience working with international teams from China to the Bay Area I can say that Czech software engineers are as good as their western counterparts, regardless of whether we look at innovation, efficiency, discipline, or experience, and they usually work harder.

There are many first-class Czech developers and architects work-ing at Google and Microsoft, establishing their own successful start-ups, selling programming books on Amazon, or contributing to open source. Also, you can find many “old-fashioned” developers that are less visible but deliver the best code you will ever see.

The difference lies in how these engineers are allocated on the market. Compared to the hot markets in the US, Israel, and India, it is still very possible to attract first-class talent to work for large international companies while not paying a fortune for it. Moreover, the top talented engineers tend to be very loyal employees. They usually do not shop for opportunities as long as the work they do is interesting and challenging. You don’t normally find the most tal-ented people in the consultancy business. In the Czech Republic you do. And this “anomaly” is not going to disappear any time soon.

Czech software engineers in demand

Contact: Hewlett-PackardVyskočilova 1140 21 Praha 4Phone: 420 261 307 111www.hp.cz

10 >> Spotlight on Project

IntroductionTheglobaleconomicdownturnandlackofen-

ergysourcesareimpactingdevelopmentinmanysectors,includingdatacentres.ThissituationcanbeaddressedbyfocusingdevelopmentintheICTfieldonenvironmentallyfriendlytechnologiesandenergy-efficient solutions. Investments in greenenergyshouldcontributetolowercosts,greatereffectivenessandhigherenergyefficiency.

DC technology infrastructureIn adata centre (DC) anddatahalls, servers

areplacedinrackcabinets.Theseareconnectedtothenetwork’sphysicalinfrastructure(supportsystems),whichensuretheirpowersupply,cool-ing,etc.Thedatahallshavetechnologyroomsthathouse, for example, distribution switchboards,backup UPS sources and batteries, a motor-generator room, an air-conditioning room andcooling chambers.The chillers and transformerstationsarelocatedoutsidethebuilding.Theentiredatacentreissecuredphysicallyand

againstfire.Gasandwater-mistfiresuppressionsystemsareusedinthedatahalls.Walls,ceilingsand doors must provide sufficient protectionagainst unauthorised access and against exter-nalfires.Theentirebuildingismonitoredandisphysicallyguardedcontinuallyin24/7modeinor-dertoeliminatepossibleriskssuchasfire,poweroutages,overheating,malfunctions,unauthorisedaccess,etc.,thusensuringmaximumavailabilityofdataandphysicalsecurity.

Classification of data centresThefirstdatacentreswerebuiltatthebegin-

ningof the1960sandwith theadvancementoftechnologicaldevelopmentbegantobeclassifiedin four categories,whicharedesignatedasTierItoTierIV.ThesimplestisaTier1datacentre,which is basically a computer room, following

Professional and modern solutions for placement and administration of servers, data fields and other elements of ICT infrastructure

basic guidelines for the installation of computersystems.ThemoststringentlevelisaTier4datacentre,whichisdesignedtohostmission-criticalcomputer systems,with fully redundant subsys-temsandcompartmentalisedsecurityzonescon-trolled using biometric access-control methods.Another consideration is the placement of thedatacentre inasubterraneancontexttoensuredatasecurityaswellasenvironmentalconsidera-tions,suchascoolingrequirements.IntheCzechRepublic there are data centres categorised asTierIII+,whicharemostlysituatedinPragueanditssurroundingareas.Inpastfewyears,DCshavebeenbuiltoutsideofexpansivebuilt-upareas; itissometimesrequiredthatdatacentrestobelo-catedatleasteightykilometresfromcitycentres.Themainpurposeofthisistolimittheriskofat-tackandbreachesof security.Blackoutsarean-othersignificantriskfordatacentres.Thankstoitsgoodinfrastructure,however,theCzechRepublicisnotpronetoblackouts.

Data centres market in the Czech RepublicIntheCzechmarket,primarilytelecommuni-

cationscompaniesownandoperatedatacentres.Thetotalareacoveredbyservers intheCzechRepublic is approximately 10,000m2. Turnoveronone squaremetre amounts to roughlyEUR600-700 per month. Multinational companiesoperatinginourregiongenerallybuildandman-agecorporateDCsintendedfortheirownuse.Assuch,theyusetheirownhardware,onwhichtheyoperateallcompanyapplications.Withgrow-ingpressuretoreducecompanycosts,thereisacontinuallygrowingneedtooutsourcenotonlythisadministrationbutthehardwareitself.Itcanbesaidthatnaturaldevelopment,notonlyintheCzechmarket, is trendingtowardconsolidationofcorporatedatacentres.

Currently,mostdatacentresareoperatingatnearlyfullcapacity.IntheCzechmarketthereareseveraldozenfirms,eachofferingsomewhatdif-ferentservicesandfocusingondifferenttypesofcustomers.For the sakeof simplification, thesecompaniescanbedividedintotwogroups.Thefirst group comprises operators andowners ofdatacentres thatownthebuildingandperhapseventheIThardware,andensurecooling,power,connectivity,etc.ThesecondgroupcomprisesDCrenters,i.e.providersofhostingserversthatrentdatahallsequippedwithhardware(orwithoutit)andmanagetheoperationofservers,whichtheyfurtherrenttotheirclients.Insomecases,thesetwogroupsvariouslyoverlapordivergeintermsofbusinessrelations(B2BandB2C).

Data centres in the Czech RepublicTelefonica O2approx.6,000m2,Tier3+,50%forcorpo-rateuse,50%forcommercialuseDHLapprox. 2,500 m2, Tier 3++, corporate useonlyVodafoneapprox. 1,000 m2, Tier 3+, corporate useonlyOther low-cost DCs (commercial use) GTS Novera, Sitel, TTC Telekomunikace, Vegacom,T-Systems,Master,CasablancaOther corporate DCsČEZ,ČeskáSpořitelna–ErsteGroupDCproCEE(approx.2,000m2),T-MobileandSystem(1,500m2)

Green IT“Green IT” is a relatively new expression

thatisagaingainingprominenceduetotheoft-discussed topics of climate change and risingenergy costs. Data centres contribute to CO2

DATA CENTRES& GREEN ITIllustrative photo

11>> Spotlight on Project

emissions, and thus the greenhouse effect, ac-countingforupto2%oftotalemissions.Since2000 theamountofenergyconsumedbydatacentreshasmorethandoubledasaresultofnotonlyagreaternumberofdatacentresandserv-ersinoperation,butalsoduetothelargershareofso-called“volumeservers”(low-costservers)withrelativelyhighaverageconsumptionofelec-tricity.Inthecaseoftheseservers,ever-increas-ingenergyconsumptionisexpectedduetorisingperformanceandmorecomplexconfigurations.Monthlypaymentsforenergycurrentlycomprisethemostsharplyrisingoperatingcost,amountingtoasmuchas35%ofICTfirms’overallbudget.Withrisingenergycosts,investmentsinmoreef-ficientandecologicallyfriendlyhardwareappeartobeunavoidable.Applicationofgreenpoliciescouldbeawaytochangethedirectionofcurrentdevelopment.

Green policies Theoperationandcoolingofcomputerunits

requires more and more energy. One of thestrategiesforimprovingtheenergyefficiencyofdatacentresisvirtualisation,whichseparatestheserverandrackenvironmentsforseveralapplica-tionsoperatingonasinglephysicalservers.Thisoptimises usage of the infrastructure, reducesenergy consumption and lowers the costs ofhardwareandmanagement.Returnon investment isoften realised in the

mediumto longterminthecaseofexchanginginefficientequipmentfornew,economicalhard-wareandmoreefficientcoolingunits.However,suchinvestmentdoesnotonlyimprovetheenvi-ronment,butalsosavesmoney.According toastudyconductedbytheconsultingfirmGartner,35%to50%ofenergyconsumedbydatacen-

tresisusedforcoolingsystems,whereasincom-paniesthatapplyagreenpolicycoolingsystemsaccountforonly15%ofenergyconsumption.Inaddition,purchasingefficienthardwarehasasyn-ergisticeffect,becausethelessenergyconsumed,thelessheatisproduced;andthelessheatpro-duced,thelessenergyisrequiredforcoolingthesystems.GreenITproductshavereducedlevelsofcadmium,leadandmercury,whichmeanstheyarehealthiertouseandlesstaxingontheenvi-ronment.Theyarealsomoreenergyefficientandeasiertoupgradeandrecycle.Asanexampleofefficienthardware,wecan cite thefirst 0-WattPC, an environmentally conscious server thatdoesnotuseanyenergywheninstand-bymodeorhibernation.Green IT requires regular measurement of

theenergyefficiencyofdatacentressothatpo-tentialproblemscanbe identifiedand improve-ments can be quantified. Energy efficiency andeconomicaloperationintheareaofpowersup-plyandcoolingofdatacentres’ITequipmentaremeasured according tometricsdevelopedby aconsortiumofTheGreenGrid,UptimeInstitute,etc.ThePUEratio(PowerUsageEffectiveness)calculatesadatacentre’stotalfacilitypoweranddividesitbytheITequipmentpower,i.e.theloadassociatedwithalltheITequipmentinusethere.Forexample,adatacentrewithaPUEvalueof3.0 consumes three times as much energy asthe equipment in operation there would actu-allyneed,indicatingpoorenergyefficiency.Well-designed, environmentally-friendly DCs achieveaPUEvalueof1.7, a veryhigh levelofenergyefficiencybycomparison.Betterorganisationofthedatahallcontributes

totheimproveduseofelectricityandhigheref-ficiencyofcooling.Adatahallthatisdividedinto

upperand loweraisles(HotandColdAisleap-proach)allowscoolingofindividualareas.Accord-ingtothePUEvalue,systemscanbearrangedinordertocreateseparatecoolingzones.Hotairinaspacedoesnotmixwithcoldair.Byshort-eningthedistancebetweentheheatsourceanditspointofremoval,coolingofthespaceismorefocusedandmoreefficient.

Outside-the-box thinkingWecanciteseveralendeavourstofindaso-

lutiontoproblemsconnectedwithDCcooling.Forexample,MicrosoftplannedtheconstructionofaDCinSiberiaandSunMicrosystemsplannedtosetupsubterraneanDCs inabandonedcoalmines,usinggroundwaterasacoolant.However,themostsurprisingsolutionisGoogle’s“compu-ternavy”ontheopenocean,whichwouldusewavestogenerateenergyandforcoolingwhilesavingmoneyonpropertytaxes.

TerminologyData centre (colocation centre/telehouse)–centralworkplace fordepositing, storageandmanagementofdatausingITinfrastructure.Server Housing (server hosting/coloca-tion) of customer servers–includesrentalofspaces for the customer’s servers anduninter-ruptedhigh-speedinternetconnection;thecus-tomerisresponsibleforserveradministration.Dedicated servers – rental of a physicalservertoonecustomer;thecustomerisrespon-sibleforserveradministration.Managed servers–rentalofaserverinclud-ingitsadministrationanddatabackup.

Eliška Pazdziorová, CzechInvest

Tier I–Basic:99.671%availability

Tier II–Redundantcomponents:99.741%availability

Tier III–Concurrentlymaintainable:99.982%availability

Tier IV–FaultTolerant:99.995%availability

Susceptibletodisruptionsfrombothplannedandunplannedactivity

Singlepathforpowerandcool-ingdistribution,noredundantcomponents(N)

Mayormaynothavearaisedfloor,UPS,orgenerator

Takes3monthstoimplement

Annualdowntimeof28.8hours

Mustbeshutdowncompletelyforperformanceofpreventivemaintenance

Lesssusceptibletodisruptionfrombothplannedandunplannedactivity

Singlepathforpowerandcoolingdistribution,includesredundantcomponents(N+1)

Includesaraisedfloor,UPSandgenerator

Takes3to6monthstoimplement

Annualdowntimeof22.0hours

Maintenanceofpowerpathandotherpartsoftheinfrastructurerequireaprocessingshutdown

Enablesplannedactivitywithoutdisruptingcomputerhardwareoperation,butunplannedeventswillstillcausedisruption

Multiplepowerandcoolingdistributionpathsbutwithonlyonepathactive,includesredundantcomponents(N+1)

Takes15to20monthstoimplement

Annualdowntimeof1.6hours

Includesaraisedfloorandsufficientcapacityanddistributiontocarryloadononepathwhileperformingmaintenanceontheother.

Plannedactivitydoesnotdisruptcriticalloadandthedatacentrecansustainatleastoneworst-caseunplannedeventwithnocriticalloadimpact

Multipleactivepowerandcoolingdistributionpaths,includesredundantcomponents(2(N+1),i.e.2UPSeachwithN+1redundancy)

Takes15to20monthstoimplement

Annualdowntimeof0.4hours

12 >> AFI insights

Thereportisbasedonanonlinesurveybetween53senior ITexecutivesand80seniorfinanceexecutivesfromallacrossEurope(i.e. fromBaťa,Vodafone,SwissLife, Barentz, and Beherman). The fol-lowingparagraphselaborateonthemostimportantresearchfindingsandperspec-tivesforthewayforward.

Percentage gap Take just two examples where views

diverge:when it comes to themost re-cent collaboration, 72% of CFOs sur-veyedbelievetheir lastprojectinvolvingIT was successful, compared with 37%of CIOs. And when asked to rate eachother on leadership skills, the ability to

Rating the success of the most recent collaboration

0% 20% 40% 60% 80%

Unssuccessful

Neither unsuccessful nor successful

Successful

CIO

CFO

13>> AFI insights

collaborate and long-termstrategicthinkingand planning, 98% ofCIOs say CFOs weregoodorexcellentlead-ers,whileonly42%ofCFOsbelievethesameabouttheirCIOs.Thissuggests that CIOshave a higher opinionof their CFOs thanviceversa.The research found

that while CFOs andCIOs generally ex-pressed high mutualregard for each other,CFOs believed thatIT lacked understand-ingof their company’sbusiness strategy andfinancial reality, whileCIOs said that the fi-nance departmentfailed to communicategoalseffectively.

Collaboration is keyTo bridge the gap,

collaboration betweenthe IT and financedepartments is cru-cial for the success oftheirprojectsandtheirsubsequent impact onearnings. Today, whena company’s success,even its viability, de-pends on the integrityofitsfinancialdataandtimelinessof transmis-sion, CFOs and CIOsmust make sure theycommunicate regular-

ly, resolve their natural differences in arationalmannerandregularlyreviewtheprocesstoensurethatitisworking.The quality of collaboration between

thefinanceandITdepartmentsneedstobeevaluatedandmeasured,forexample,

byestablishingnewmetricsthatwillshowhowtechnologycandriveproductivityinother parts of the business and demon-stratethereturnsonITinvestments.ThefinanceandITdepartmentsshouldworktogether to identify the measures thatmatter to the business andmechanismsensuringthattheycanbesuccessfullyim-plemented and communicated. Evalua-tionofthisinformationcouldbedonebyanestablishedsteeringcommittee,whichwouldincludemembersfromtheopera-tional, ITand financedepartments,whomeet regularly. The emphasis placed oncommunicationwouldthenextendfromtheboardleveltocross-functionalteamsand to the shop floor, thus getting “re-sultsforthebusiness”.Sharing knowledge and experience is

key. A oft-cited problem is that CFOsandCIOsinameetingroomalwaysspeakdifferent languages.One of the researchparticipants, for example, implementedregularjobrotations,movingpromisingITmanagers into the business section for aperiodoftimeandgivingpeoplefromthebusinesssideachancetoworkintheITde-partment.ThisshouldhelptheITstafftounderstandbusinessprioritiesandthoseinfinancetobeawareofunderlyingtechnol-ogyproblemsso thateveryone ison thesamepage.OthercompaniesemphasisedtheneedformorebusinesseducationforITleadersasawaytobridgethegapbe-tween the functions and achieve betterunderstanding.ThemutualexpectationsofCIOsfrom

CFOsandviceversaarestatedintheta-blebelow.

The IT function must have a voiceResearch respondents were in near

universal agreement that the IT depart-mentneeds tohaveavoiceat thehigh-est level of the company, regardless ofwhetherthismeansthattheCIOreportsdirectly to the board or to the CFO.What is crucial is that the IT function’srole and contribution should be under-stoodandthat it shouldbeable toalignitself with achieving strategic goals and

drivingvalue.Bytheirverynature,CFOsand CIOs often compete for attention,resourcesandauthority,butthesuccessof their projects – and the company’soverall performance – is dependant ontheirability tocooperate.TheCFOandCIO relationship needs to be built ontrust andmutual confidence to becomeapartnershipand,eventhoughitisverydifficulttoachieveaperfectlevelofcom-munication,itwilleventuallypayoff.Thefreshideasresultingfromgenuinecollab-orationcansavea lotofresourcesfrombeingwastedonmistakes.

What is the way forward?Themodel for the future is based on

ambitious CFOs and CIOs who drivebusiness change, speak the same lan-guageandsharecommongoals.There-lationshipbetweentheCIOandtheCFOwill still be very important, because ithasthepotentialtoimpedeoraccelerateoverallbusinessperformance.Acceptingthestatusquolookslikeasure-fireroutetoamarriageofconvenienceratherthana beautiful friendship. The in-depth in-terviews indicated thatmanycompanieshave made progress by understandingthefundamentaldifferencesandbridgingthegaps.Theresearchresultsshowthatunderstandinghowtodismantlebarriersbetweenthe IT functionand finance to-dayandthenbuildingaplatformforcol-laborationwillbethekeytotheirmutualsuccess.

Contact:

PricewaterhouseCoopersCzechRepublicKaterinska40,12000Prague2Phone:+420251151111

E-mail:pricewaterhousecoopers.cz@cz.pwc.comwww.pwc.com/cz

What CIOs want from CFOs What CFOs want from CIOs

“Morecommunication” “Workingmorecloselytogether”

“Talkingtoeachother” “CIOreportstotheCFO”

“Morewrittencommunication” “FinancecoursesfortheITpeople”

“Moreforcedcommunication” “Mutualunderstandingofbusinessstrategy”

“Bettercommunication” “ITshoulddelivermorevalue”

“Moreflexibility” “ClarifytheITstrategy”

Jiří Halouzka Ladislav Juza

Advisory Services, PricewaterhouseCoopers Czech Republic

14 >> AFI insights

ThePredictorrevealsasignificantfallin12-month forward corporate valuationsandthereforealsointheappetitetomakedeals(downglobally22.2%from15.3xattheendMay2008to11.9xat theendofNovember 2008). Forecasted net debt-to-EBITDA ratios havemoved from0.93timesto1.06times,a13.5%declinesign-alingadecreasingcapacitytomakedeals.These findings confirm our view that

2009willbeabadyear forM&Aactivity.Weexpectglobaldealvolumestocontin-ue to fall throughQ3.With less liquidityin themarket and reduced availability ofcredit,theappetiteandcapacityformak-ingdealswillcontinuetodecline.However,ouranalysisleadsustobelieve

thatthecornermaywellbeturnedlateinthe second half of this year. Those whoended2008feelingtiredanddisappointed

fromendlessbadnewshavestarted2009withadesire tokick-start thedealsmar-ket.Thiswill be facilitatedbyopportuni-ties that will inevitably emerge for valueinvestorsincertainregionsandsectors.The market players to watch will be

those able to execute cash deals, suchas companies that have preserved cashfunds, some sovereign wealth funds,and private family businesses.Within 12

KPMG’s Global M&A Predictor: Global deal activity set to hit bottom in Q2/Q3,

with gradual recovery from late 2009

KPMG Corporate Finance’s Global M&A Predictor – a forward-looking survey of 1,000 leading companies’ estimated ratios of net debt-to-EBITDA and prospective price/earnings ratios –

forecasts that 2009 will see a continued fall in global mergers and acquisitions (M&A) but that deal activity should slowly rebound late in the year as liquidity improves and attractive

value is recognised in certain sectors.

Illustrative photo

15>> AFI insights

Contact:

KPMGCzechRepublicPobřežní1a

18600Prague8Tel.:+420222123111E-mail:kpmg@kpmg.cz

www.kpmg.cz

months,wewill start to see some clearsignsofaslow,yetstrong,recoveryintheM&Atransactionsmarketplace.Areliableindicatorthatthistimehasarrivedwillbewhenqualityassetscomeonthemarketand go for reasonable, rather than fire-sale,prices.The latest Predictor indicates that by

Q2/Q3 2009 the point will come whenthe appetite for making deals will im-prove as cash-rich investors find it hardto resist the very low valuations in themarket.This forecastedpick-up inM&Aactivitymayprovideoneof thepositiveindicatorsneededbyeconomiccommen-tatorstosignalanupturninthebroadereconomy.

Czech Republic and CEEThe Czech Republic and CEEwill see a

similardramaticfallindealactivity.Inthelastthreemonthsof2008wesawseveralnearlyfinalised deals fall through at the last mo-ment.Thiswasduetoacombinationoffac-tors.Ontheonehand,itwasverydifficulttoobtainbankfinancingforacquisitionsand,ontheotherhand,potentialbuyerswerewait-ingforpricestocomedownfurther.In terms of bank financing, the situation

hasbeenextremelydifficultinthepastfewmonthsandthis isexpectedtocontinue. Ifbanksarewillingtoprovidefinancinginthismarket, theywilldosoonlyat significantlyincreased interestmargins (byseveralhun-dredbasispoints)andatextremelylowlev-erage.Though itmayseemaparadox, thisshortageincreditavailabilityisalsolikelytolead to new deal activity. Companies thatcurrently have short-term financing andneed to refinance or companies that maybeinbreachofcredit-agreementcovenantsas a result of the economic crisismay beforcedtosellassets.Thiswillprovidegoodopportunitiesforcash-richinvestors.The impactofall thiswillvery likelyalso

beseenintheprivatisationofCzechAirlinesandPragueAirport.Evensuchstrongassetswilllikelyattractfewerpotentialbuyersandwill be sold for less than normally wouldhavebeenthecase.

Forecasted M&A Activity by World RegionForthefirsttime,thePredictorindicatesa

decliningvaluationtrendinallregionsoftheworld, demonstrating the global decline inM&Aactivity.Aspreviously,theregionwhichhadthebiggestdropinvaluationwasAfricaandtheMiddleEast(PEsdown31.6%,from13.3xto9.1x).LatinAmericahadthesecondbiggestfall(28.7%,from16.1xto11.5x),fol-lowedbyNorthAmerica(24.6%,downfrom15.9xto12.0).IncontrasttothelastPredic-tor,inwhichEuropeexperiencedthesecondbiggestdecliine, sixmonthsonEuropesawthe second smallest fall (21%, from 13.5xto10.7x)behindAsiaPacific,whichdeclined19.9%,from17.0xto13.6x.Although the capacity tomakedeals has

decreased with the global forecasted netdebt-to-EBITDA ratio moving from 0.93timesto1.06times,someregionshaveseenanimprovementintheirbalancesheets.LatinAmerica andAfrica and theMiddle

Eastbuckedthetrendandbothregionssawimprovementsof3.2%and35.7%,respec-tively,withAfricaandtheMiddleEast’sratioof0.33timesbeingthemostmodestofall.Europemaintains its position ashaving thehighestregionalratioof1.15,havingmovedfrom0.97times,adeclineof19.0%.

While theAmericas and Europe have allwitnessedsignificant falls in forwardPEra-tios,balancesheetsremainrobustinNorthAmericaandLatinAmerica,suggestingthatsome corporations will remain in a strongposition should value-enhancing acquisitionopportunities arise. Within Europe, how-ever, balance sheets have deteriorated by19%,implyingthatthesecompaniesarein-creasinglylesslikelytoexecutedealsinthenearterm.

Forecasted M&A Activity by Global SectorThePredictorhasshownadeclineinfor-

wardPEvaluationacrossallsectors,withtechnology(18.4xto12.6x),basicmateri-als(13.8xto9.6x)andindustrials(15.5xto11.1x)registeringthemostsignificantde-terioration.Unliketheresultsshownintheprevious edition of the Predictor, oil andgas fell significantly (11.8x to 8.6x) alongwithtelecommunications(14.1xto10.8x),consumer services (17.0x to 13.5x) andhealthcare (15.5x to12.5x).The smallestdeclinewasintheconsumergoodssector(16.2xto14.6x).Utilities and industrials continue to

maintainthehighestdebtratios,withnetdebt-to-EBITDA at 2.68 times and 2.27times, respectively. The technology sec-torcontinuestoshownetcash,whichre-flectsatraditionalbalancesheetstructureforthispeergroup,thoughhealthcarehasmovedfromanetcashpositiontooneofnetdebt.

Alex Verbeek,CEE chairman of

KPMG’s corporate finance practice

16

administrative units (TAUs), and contributoryor-ganisationsgovernedbyTAUs.However,apubliccontractingauthoritymayalsobeanotherlegalen-tityifitwasestablishedforthepurposeofservingthepublicinterest,doesnothaveanindustrialorcommercialcharacter,andisfinancedorcontrol-led by another contracting authority or anothercontractingauthorityappointsorselectsmorethanhalfofthemembersofitsstatutory,management,supervisoryandauditingbodies.Priortothecommencementoftheconcession

procedure, the public contracting authoritymustensure the formulation of a concession project,which should contain the basic definition of theconcessionactivity,economicconditionsandlegalregulationships ensuing from the implementationof theconcessioncontract andeconomicassess-mentofthesuitabilityofensuringtheconcessionactivityintheformofaconcessioncontract.Priortocommencementoftheconcessionprocedure,aconcessionprojectoftheCzechRepublicorastatecontributoryorganisationmustbeapprovedbythegovernmentoftheCzechRepublic.Ifthisconcernsa concessionprojectof aTAU, itmust thus alsobeapprovedbytherelevantregionalormunicipalcouncil.Thepubliccontractingauthoritycanthenpublishanannouncementonthecommencementof the concession procedure. If this involves, forexample, a concession contract on constructionworkwiththeplannedvalueofthesubjectthereofgreaterthanCZK146,447,000,theannouncementonthecommencementoftheconcessionproce-dureispublishedsimultaneouslyinthepublic-pro-curement information system and in theOfficialJournaloftheEU.Otherannouncementsarepub-lishedonlyinthepublic-procurementinformationsystem.TheConcessionActrecognisesasinglemethod

ofselectingsuppliers/concessionaires,whichistheconcessiondialogue,whereasthisrefersindetailtotheprovisionsoftheActonPublicProcurementre-latingtocompetitiondialogue.Withincompetitiondialogue,thepubliccontractingauthorityengagesinnegotiationswiththeinterestedpartyonallas-pectsoftheprojectand, jointlywiththepartner,endeavourstofindthemostsuitablesolutionsthatwouldfulfilthepartners’needsandrequirements.Thecontractingauthorityselectsoneormorepro-posed solutions and subsequently submits to theinterestedparty itsoffers, fromwhichanassess-mentcommitteeselectstheonethatwasjudgedthemosteconomicallyfavourable.Thecontractingauthoritythenconcludesacon-

cessioncontractwiththechoseninterestedparty,i.e.theconcessionaire.Thelawexpresslystipulatesthatsuchacontractcanbeconcludedonlyforade-

>> AFI insights

Legal framework of Public Private Partnerships in the Czech Republic

What is a public-private partnership?Atpresent,thereisnoall-encompassingdefinition

ofapublic-privatepartnership(PPP).Apartnershipbetweenthepublicandprivatesectorsisoneofthemeansofensuringtheavailabilityofpublicservicesandrelatedinfrastructure.Thisgenerallyinvolvesalong-term(e.g.25-30years)contractuallygovernedrelationshipbetweenapublicentity,suchasalocaladministrativeunitor the state representedby aministryorthegovernment,andaprivatecompanyorconsortium.Withinsucharelationshipcompany,asaprivatepartner,takesonthetraditionalroleofthestateasthecaretakerandproviderofapublicservice.Theprivatepartnerbearstheimmediateacquisitioncostsof infrastructure/facilities,thoughforacontractuallystipulatedperiodpaymentsforaccessibility arepaideitherby thepublicpartnerorthroughdirectcollectionoffeesfromtheend-usersofthe infrastructureorservice.Theextentof theprivatepartner’s involvementmayvary. Ina typicalPPPproject, theprivatepartnerdesignsandbuildsfacilitiesthatitmanagesandoperatesfor

a stipulated periodof time.Theprivatepartner should thusbe motivated touse the most effec-tive solutions andprocesses not onlyin construction, butalso in selecting thebest technologywhen equipping thefacilities, in orderto minimise futureoperating costs andincrease its profit.Unlike in standardpublictenders,inPPPprojects the publicentitysetsforthonlythe general entrycriteria and leavesthemanner of theirfulfilmenttothepri-vate partner, which

choosesthemostsuitablesolution.Anotherdiffer-encebetweenpublictendersandPPPprojects isthedistributionofrisksandthetransferthereoftothepartnerthatcanbetteroffsetsuchriskswithlowercosts.Theprivatepartnergenerallytakesonthe risks associatedwith project documentation,design/construction, construction-cost overruns,defective technology, technological deficiencies,lackofhumanresources,humanerror,etc.There is a full rangeof projects inwhichPPP

methodologyisused–thismostcommonlyinvolvesprojectsinthetransportationsector(motorways,railways, airports, tunnels, bridges, parking fa-cilities),healthcare(hospitals),watermanagement(sewerage, water-treatment plants), and wastemanagement(pressingstations,recyclingfacilities),thoughwecanalsofindprojectsinvolvinghousingfacilities(prisons,carehomes,residentialbuildingswith rental flats) and recreation facilities (sportsstadiums).

Legal regulationPursuant to the Concession Act? Duetoalackoflegalregulationsthatwouldcom-

prehensivelygovernconcessioncontractsconclud-edwithinPPPprojects,ActNo.139/2006Coll.,onConcessionContractsandConcessionProcedures(theConcessionAct)waspassedin2006.PursuanttotheConcessionAct,thisinvolvesso-

calledpubliccontractingauthorities,i.e.theCzechRepublic, state contributory organisations (e.g.the Road andMotorway Directorate), territorial

PPPsinEurope

Sincethebeginningofthe1990s,morethan625 projects valued atGBP 58 billion havebeenimplementedinGreatBritainalone.InotherEuropeancountries,200PPPprojectswereimplementedbetween2001and2007atacostofoverEUR31.6billion.

17>> AFI insights

finedperiod,mustcontainthereasonsforprema-tureterminationofthecontractandadefinitionofthelegalrelationshipsofthecontractingauthorityandconcessionairetotheassetthatisthesubjectofthecontract,includingregulationspertainingtoitssettlementifthecontractisterminatedprema-turely,andmustfulfilthestipulatedformalrequire-ments–thecontractmustbeinwrittenformwiththesignaturesofthecontractingparties.Inaddition,theconcessioncontractmustbeapprovedsimilarlyasinthecaseofaconcessionproject.

Pursuant to the Public Procurement Act?Howeverinsomecases,ActNo.137/2006Coll.,

onPublicProcurement (thePublicProcurementAct), is also applied during the implementationofaPPPproject.Applicationofthisactdoesnotdependonthewillofthepublicentity(contract-ingauthority),butratheronwhethertheprivatepartnerasthesupplierwilltakethebenefitsensu-ingfromtheprovisionofservicesorfromtheuseof theproducedgood. InterpretationregulationsoftheEuropeanCommissiononconcessionspur-suanttoEClawexpresslystatethat“aprojectisconsideredapublictenderforconstructionworkin the terms of Community law if constructioncostsarecoveredprimarilybythepubliccontract-ingauthorityandthesupplierdoesnotreceivere-munerationfromfeespaiddirectlybythosewhousethestructure.”ThesameopinionisheldbytheMinistryforRegionalDevelopmentoftheCzechRepublic, where it is expressly stipulated in theConcession Actmethodology that “if the entirepayment forthesubjectof fulfilment isprovidedtothesupplierbythecontractingauthority,thisbydefinitioninvolvespublicprocurement.”ThePublicProcurementActgovernssixtypesof

awardprocedures,ofwhichonlytwowillpertaintomostPPPprojects–anegotiationprocedurewith publication and competition dialogue. Bothformsofawardproceduresallownegotiationontheconditionsoftheprojectandtherequirementsandneedsofthecontractingauthorities’entities.ThemethodologyoftheMinistryforRegionalDe-velopment recommends competition dialogue,“withregardtothefactthat[...]itenablestheap-plicanttospecifytheparametersoftheprojectsothatitwillmaximallycorrespondtotheneedsofthecontractingauthority.”

Or something from everyone?However, PPP projects differ from standard

publicorders,particularlybythe longdurationofthe contractual relationship between the privateand public partners and distribution of risks. Inthe case of so-called above-limit public tenders,wherethecontractshouldbeconcludedforape-riodof at leastfiveyears and the supplierbearssomeof theeconomic risks connectedwith therealisationofthepublicorderthatwouldnormallybebornebythepubliccontractingauthority,thePublicProcurementActexpressly stipulates thatcertainprovisionsoftheConcessionActshallbe

applied.Thus arises a special public tenderwithconcessionelements,i.e.aquasi-concession.Thecontract,onthebasisofwhichsuchapublicten-derisrealised,canbeconcludedonlyforafiniteperiodandmustcontain theprovisionsrequiredfor a concession contract. Unlike standard pub-lic tenders, in thecaseofaquasi-concessionthecontractingauthorityisobligatedtoensure,priortocommencementof theawardprocedure, theformulationof a concession project that, like anactualconcessioncontract, issubjecttoapprovalbythegovernmentorrelevantcouncils.UnlikethePublicProcurementAct,however,theConcessionAct containsprovisions that allow, if thedefinedconditionsarefulfilled,conclusionofaconcessioncontractinsteadwithaselectedsupplier,evenale-galentity,thatdidnotparticipateintheconcessionprocedure.InPPPprojectstheActthustakesintoaccountthecommonlyusedinstitutionofspecial,independentcommercialfirmsestablishedforthepurposeofimplementingtheproject(SpecialPur-poseVehicle–SPV),whosesharesareownedbyprivatecompaniesthatwereselectedassuppliersfortheproject.TheinvolvementofanSPVsimpli-fies the web of mutual contractual relationships,whichbringsbenefitsparticulartothepublicentity,whichthusdealswithonlyoneprivateentity.InthecaseofaPPPprojecttowhichthePublicProcure-mentActwillbeapplied,itisnecessaryforsuchafirmtobeestablishedpriortocommencementoftheawardprocedure,astheActonPublicProcure-mentallowstheconclusionofacontractonlywithanapplicantthatparticipatedintheprocedure.

Who can be a supplier/concessionaire?Asupplier,aswellasaconcessionaire,mustfulfil

basic professional and technical qualification re-quirements. The basic qualification requirementsinclude, among other things, probity and non-existenceofunpaidtaxliabilitiesandcontributionsformedicalinsurance,socialsecurityandthestateemploymentpolicy.FulfilmentofthesequalificationrequirementsisdemonstratedwithanextractfromtheRegisterofCriminalRecordsandaconfirmationfromtherelevanttaxauthorityandinsurancead-ministrationofficesthattheentityisnotinarrears.In thecase that the supplieror concessionaire isaforeign legalentity, itmustdemonstratethatallmembersof itsstatutorybodyarenot inarrearsbothinthecountryinwhichtheentityisregisteredandintheCzechRepublic.Documentsconfirmingthattheconcernedpartiesarenotinarrearsmaynotbeolderthan90days,mustbesubmittedtothecontractingauthority intheiroriginal formornotarisedcopiesthereoftogetherwithanotarisedtranslation into theCzech language.Generally, itwillalsobenecessarytofurnishthesedocumentswithanapostille.Withregardtotherelativelyshortperiodofvalidityofthedocumentsandtime-con-suming natureof acquiring them, including apos-tilles,fromabroad,thelawoffersthepossibilitytoregister in a list of qualified suppliers.Anextractfromthislistservesasconfirmationoffulfilmentof

thebasicqualificationrequirements.Fulfilmentoftheprofessionalqualificationrequirementsisdem-onstratedbyatradelicence,adocumentissuedbyaprofessionalorganisation ifmembership insuchanorganisationisrequiredforfulfilmentofpubliccontracts,oradocumentverifyingtheprofessionalcompetenceofthesupplier.Fulfilmentofthetech-nicalqualificationrequirementsisdemonstratedbyalistofrealiseddeliveries,technicians,thetechnicalequipmentandfacilitiesthatthesupplierorconces-sionairewillhaveatitsdisposal,etc.

Current PPP projects in the Czech RepublicCurrently the first domestic PPP projects are

beingimplementedintheCzechRepublicwithatotalvalueofmorethanCZK188billion.TheMin-istry of Transportation is preparing two projects–AirCon,whichwill linkPrague-RuzyněAirportto thecentreofPrague, includingoperationandmaintenance,atanestimatedcostofCZK25bil-lion;andaprojectinvolvingtheconstructionandfinancingofsectionsoftheD3motorwayandR3expresswayatanexpectedcostofmorethanCZK59billion.TheMinistryofJusticeisplanningtouseaPPPvariantforconstructionandoperationofaprison in Rapotice u Brna and construction of acourtcomplexinÚstínadLabem.ThecombinedcostofbothprojectswillbenearlyCZK7billion.Thelargestamount,nearlyCZK100billion,willbeinvestedbytheMinistryofFinanceinaprojecttoeliminatecertainecologicalburdensthatarosebe-foreprivatisation.Concessionprojectshavebeenapproved in all cases,with the exceptionof theAirConproject.Awardprocedureswillfollow.

Contact:

NÖRRSTIEFENHOFERLUTZv.o.s.NaPoříčí1079/3a11000Prague1CzechRepublic

Tel.:+420233112111E-mail:info@noerr.com

www.noerr.com

NÖRR STIEFENHOFER LUTZ v. o. s.

Marta Drbohlavová, advokátní koncipientka

Ilona Šrollová, advokátka

18 >> Country Focus

The American economy is still not in the best shape. Unemployment increased to 8.1%

in February, the highest rate since 1983. This is higher than in some European countries, that gen-erally had higher unemployment than the United

States. The recovery has not come yet and it is unclear, how long it will take. This situation can influence global investment overall, either posi-

tively or negatively for different economies.

Somebig,diversifiedmultinationalAmeri-can companies are not in such bad shapeas the overall economy and some sectors.Companiescontinueto investathomeandabroad and CzechInvest is still busy withnewAmericanprojects.Wearestillreceiv-ing some manufacturing inquiries, thoughwewouldincreasinglyprefertoconcentrateon projects in sectors such as IT, softwaredevelopment, shared services, businesssupport services, life sciences, biotechnol-ogy,aerospace,andotherinterestingareas,including various research and innovationactivities,cooperationamongbusiness,gov-ernment and academic entities, joint ven-tures and higher-value-added sourcing ofproducts from the Czech Republic, mainlytothestrongEUmarketbyAmericanmulti-European operations. TheUnited States is

still one of the most important players intheworldintermsofforeigndirect invest-ment. Overall, the country is both one ofthebiggestrecipientsandoneofthebiggestproviders of capital and projects. The USalsohistorically ranks at the top in innova-tionandR&Dactivitiesinalmostallsectors,together with Germany, Japan and someothercountries.ThisfactisalsoreflectedinCzechInvest’smarketing and project strat-egy in the territory (US and Canada). Asmentionedabove,in2008and2009wearefocusingmainlyonthefollowinghigh-value-addedsectorstoattractnewinvestment:

ITandsoftwaredevelopmentSharedservicesandbusinessservicesLifesciencesandbiotechnologyAerospace

American corporationsmade their waytothetopthroughglobalinvestment,prod-ucts and services, andglobally recognisedbrands.Intheearly1990s,someAmericancompanies entered theCzech andotherEasternEuropeanmarketsmainlythroughproductpenetration,acquisitionsandmod-ernisation of Czech companies. One ofthebest examplesof theseearly projectsis thatof thecompanyProcter&Gambleand its growth in Rakovnik. Even whensome companies followed, such as Hon-eywell and Ingersoll Rand, foreign directinvestmentintheCzechRepublicwasnotso significant in the beginning. Countrieslike Poland and Hungary received manymoreprojects fromtheUnitedStates, Ja-pan and Germany. In the late 1990s, theCzechgovernmentdecided to implement

Microsoft in the Czech Republic (source: www.passerinvest.cz)

American investment and the potential for the Czech Republic

Oracle in the Czech Republic

19>> Country Focus

various kinds of investment incentives tohelpboostforeigndirectinvestmentinthecountry, andwe could see some positiveresults of this effort later, especially from2000 to 2006. Incentives were first ap-provedforthemanufacturingindustryandlater applied to business support servicesand technology centres. These measuresalso helped to increase the number ofAmerican projects forwhichCzechInvestprovides assistance. Although incentivesareusuallynotthemostdecisivefactorinnewinvestmentlocation(theseareusuallylabouravailability,infrastructure,theprod-uctandmarket),thewelcomingapproachoftheCzechgovernmentcouldhaveasig-nificantpositiveinfluenceoninvestors.American companies in the Czech Re-

publicarenowleadersinnewprojects insectors like information technology, soft-ware development, shared services andbusiness services centres, as well as inexpansionofexistingoperationsandbusi-nessactivities.Honeywell and Ingersoll Rand provide

some of the best examples of the con-tinuing expansions of multi-investmentAmericanprojectsintheCzechRepublic.Thesecorporationshaveallkindsofbusi-nessactivitiesinourcountry,fromseveralmanufacturingplantstoseveralinnovationandservicescentresinvariousCzechcit-ies. Another outstanding recent exampleisMicrosoft’sgrowingnumberof innova-tioncentresandbusinessactivities intheCzech Republic. All of these companiesandmanyotherscontinuetoenjoyaccesstoskilledCzechlabourandthestableandfavourable business environment of theCzech Republic, where from they canservethepowerfulEUmarket.As for projects involving business

services and development centres, untilrelatively recently Prague was the mostpopular location,with investmentsfrom,among others, Computer Associates,Microsoft, Exxon Mobil, Sun Microsys-tems and ADP (see our updated mapsofAmericancompaniesintheCzechRe-public). But lately, however, many com-panieshavediscoveredtheadvantagesofuniversitycitieslikeBrno,Ostrava,PlzenandOlomouc and a growing number ofnewprojectsarebeingdirectedtothesenew locations, which is very importantfortheoveralldevelopmentoftheCzecheconomy.Honeywell,IBM,RedHat,Sch-neider Logistics, Roper, Solectron andSRAareonlyafewofthecompaniesthathave setupoperationsoutside thecapi-tal. Brno in particular, with its talentedand skilled university-educated work-force isnowbeingviewed in theUnited

StatesasthenewstarinCentralEurope.In theNorthAmericanmarket thisyear,CzechInvestisfocusingalmostexclusivelyonsophisticatedinvestmentsandprojectswithhigher addedvalue. In the first halfof the 1990s the agency workedmainlyonmanufacturing projects and following2002thenumberofproduction-orientedprojects was equalled by services andtechnology centres. American projectssubstantially transformed the nature ofFDI in the Czech Republic, helping topush non-manufacturing projects to thefore. Of course, this is due to the highdegree of development of American in-vestmentsonaglobalscale.GEAviation’sacquisition of Walter, an aircraft-enginemanufacturer, and its preparations tobuild a large technologyunit innewandmodernised spaces based on the existingproductionoperationsprovideagoodex-ampleofsuchaninvestment implementedintheCzechRepublicinpastyear.Thesamecan be said for Concur’s project to opena software centre in Prague. IT projectscompriseabigpartofnewactivitiesorigi-natingintheUnitedStates.Perhapsevenmore important than new projects arethose involving thecontinuingexpansionof American firms that are further de-veloping their existing operations in theCzechRepublic(e.g.Honeywell,IngersollRand, IBM, Visteon, Microsoft, Meopta,ComputerAssociates, etc.). Projects re-latedtohealthcareandmedicalresearchanddevelopmentarealsoofgreatimpor-tance.Forexample, inBrnotheInterna-tionalClinicalResearchCentre, inwhichthe renownedMayo Clinic is participat-ing, is one of the best representationsof advanced medical investments in theCzechRepublic.Thankstothis,othergi-ants in the healthcare industry, such asGEHealthcareandClevelandClinic,andpharmaceuticalsandbiotechnology firmslike Wyeth, Abbott, Amgen, Genentechor Genzyme have shown interest in es-tablishingapresencehere.Successful expansions provide a guar-

antee of long-term operation in the ter-ritory, though of course in the competi-tiveenvironmentandconstantlychangingglobaleconomyitisnecessarytobepre-pared for all possible contingencies. IntheUnited States, for example, it is notunusualforapreviouslysuccessfulfirmtorestrict or even discontinue operationsinagivenregionduetochangingmarketconditions. Conversely, a region, city orcountry thatpossessesquality infrastruc-tureandaneducated, flexibleworkforcecould expect to retain such operations,thoughperhapsunder adifferentowner.

As always, the most important factor isahelpful approach to investorsandbusi-nessactivities,whichprovidesaclearsig-nal that they are welcome in the CzechRepublic. An important part of this ap-proach is topointout that theextentofincentives, whether in the form of sub-sidies, tax relief or other benefits, can–butmaynot necessarily – changeon acase-by-case basis. In the United States,governorsofindividualstatesandmayorsof cities compete intensely for investors,and the fight for investments is probablyevenmoreintensethanthatbetweenEu-ropeannations.CzechInvest andCzechTrade currently

operate a joint office in Chicago, syner-gistically covering priority activities byattracting high-quality investors to theCzech Republic and supporting smalland medium-sized enterprises’ exportsto the American market. The agencies’joint events help to enhance the CzechRepublic’s image among all concernedbusiness entities. In addition, the officecollaborates with the economic sectionoftheCzechembassy inWashingtonandconsulatesinNewYork,ChicagoandLosAngeles. CzechInvest has decided to re-open its office on thewest coast of theUnitedStatesthisyearinordertobetterserve this importantandexpansive terri-tory. CzechInvest is now in the processofselectingthelocationofthenewofficeandexploringwaystobestexploitsyner-giesbetweenbothofitsAmericanofficesandforthewholeregion, includingsomeprojects, seminars and business exhibi-tionsinCanada.CzechInvestwillcontinuetoconcentrateonthehigher-value-addedprojects and bringing new, high-qualityAmerican investments to the Czech Re-public. Even during the economic crisis,orperhapsbecauseof it,Americancom-paniesarestillveryactivelysearchingfornewmarketsand investment locations inorder to diversify their global businessportfolios.

Bohuslav FrelichCzechInvest, Chicago Office

Contact:

222MerchandiseMartPlazaSuite938

Chicago,IL60654U.S.A.

Phone:+1-312-2450180E-mail:chicago@czechinvest.orgWeb:www.czechinvest.org

20 >> Hot Topic

IBMprovidesanoutstandingexamplefromthepastyear.Thecompa-nyhasfocusedonsoftwaredevelopmentintheCzechRepublicsincethe1990s. ItsexcellentexperiencewithCzechprogrammersandtheoverallbusinessenvironmentintheCzechRepublicplayedasignificantroleinthecompany’sdecisionlastyeartorelocatethemanagementoftheentireIBMgroupforCentralandEasternEuropefromViennatoPrague.The list of new investors from last year includes, for example,eBay,

whichopeneditsmarketingandanalysiscentreforEuropeinPrague.Re-gus,whichleasesoutofficespacesincludingallrelatedservicesin70coun-tries,isgraduallyconcentratingthecompleteadministrationofitsfinancesandothersharedservicesinPrague.Last year’smost significantexpansions includedabillion-crown invest-

mentbytheIsraelicompanyTevainpharmaceuticalproductionatitsIVAXsubsidiaryinOpava.EXBIOandCPN,forexample,arepreparingcentresforresearch in theareasofpharmacyandbiotechnology,while theZlín-basedcompanyRokospol,whichproducespaintcontainingnanoparticles,isalsoestablishingatechnologycentre.“Last year CzechInvest also helped Czech firms to obtain orders in

the value of CZK 930million from significant foreign companies,” addsRudyšarová,commentingontheagency’sotherimportantservicesfordo-mesticcompanies.“TheCzechRepublichasclearlyenteredthenextphaseofattractingnewinvestmentsandbuildingaknowledge-basedeconomy,asinvestmentsinserviceshavebeguntoflowintothecountryonalargescalefollowingthepreviousdominanceofmanufacturinginvestments,”saysmac-roeconomistTomášSedláček,commentingonthestatistics.“Inpastyears,arangeoftrulybiginvestorshavebeenattractedtoregionswithhighun-employment.Havinghadpositiveinitialexperiencewithproductionhere,manyoftheseinvestorshaveentrustedoriginalresearchanddevelopmenttotheirCzechbranches.However,wemustn’tforgetthatalargepropor-tionoftheseinvestmentswouldnothavebeenpossibleorhavebeenmadesosooniftheCzechRepublichadnotfirstprovenitselfworthyintheareaofproduction.”

Software developers in the forefrontSoftwaredevelopersarebehindthegreatestnumberofnewinvestments,

accountingfor21%ofthetotalnumberofnewprojects.Forty-threenewsoftware-development centres are being established with CzechInvest’sassistance.Thesecentreswillemploy3,000people, two-thirdsofwhomwillbeuniversitygraduates.Engineering,with37projects,wasthesecondstrongestsectorlastyearintermsofnewinvestments.Thecountry’stradi-tionalchampion,theautomotiveindustry,felltothirdplacewith28invest-ments.“AVGinBrno,TeLogicinLiberecandIT SystemsinČeskéBudějovice

arejustafewnamesonalonglistofnewandexpandingsoftware-devel-opment companies in theCzech Republic. The dominant share of suchcompaniesinthetotalnumberofnewprojectsisfurtherevidenceofhowthecompositionofinvestmentsischangingdramatically,”saysRudyšarová.“Onlyafewyearsagotheautomotiveindustrywasundeniablydominant;todaysectorsinvolvingservicesratherthanmanufacturingareofcompara-bleimportance.”Comparison with 2007Accordingtoprecisestatisticsfor2007,CzechInvestassistedingaining

201investmentprojectsfortheCzechRepublicthatyearinthetotalvalueofCZK71billion.“Whereasin2007researchanddevelopmentorservicescomprisedonly32%ofallinvestmentprojects,thisyearthatfigureis63%.Top-qualityequipmentforsoftwaredevelopersisgenerallylessexpensive

Investment in the Czech Republic in 2008: services surpass manufacturing for the first time

LastyearinvestmentsinresearchanddevelopmentandbusinesssupportservicesintheCzechRepublicoutweighedthoseinmanufacturingprojectsfor thefirst time.This is according to statistics fromCzechInvest,whichhelpsdomesticandforeigninvestorstoimplementtheirbusinessplansintheCzechRepublic.WithCzechInvest’sassistance,atotalof213newinvest-mentprojectsaretobeimplemented;76ofthesearefocusedonresearchanddevelopment,58onservicesand79onproduction.Theseprojectswillcreatejobsfor14,606people,includingnearly4,000universitygraduates.ThetotalvalueofthenewinvestmentsisCZK30billion.“Therewasa fundamentalchange in thenatureofnew investments in

2008.Itwasthefirsttimeeverthatservices,includingresearchanddevelop-ment,comprisedthemajorityofnewprojects,”saysAlexandraRudyšarová,actingCEOofCzechInvest.“Ononehand,thisisanaturaldevelopment–theCzechRepublicisliterallyinthecentreofEuropeandifcompanieswanttosucceedhere,theyhaveonlyoneoption,whichistoinvestinstate-of-the-arttechnologiesandinresearchsothattheycanoffercustomersthehighestpossiblequality.Ontheotherhand,CzechInvesthasbeenabletoacceleratethisdevelopmentthankstosupportfromnationalandEuropeansources.”

Nearly two out of three new investment projects gained by CzechInvest in 2008 involved research

and development or business support services.

21>> Hot Topic

thanconstructionofanewmanufacturingplant.Inaddition,mostcompaniesthatareinvestinginservicesleasefacilitiesandequipment,soaccordingtoourstatisticstheirinitialinvestmentislower,”saysRudyšarová.“Attractingnewinvestmentprojectstothecountryisnotaboutthesizeof

theinitialinvestment.Theimportantthingisthelevelofaddedvaluecreatedbytheinvestor’semployees.Incomingyearswecanexpectthatinvestmentvolumeswilldeclinewhileaddedvalueincompanieswillgrow,”saysTomášSedláček.

Aid accelerates researchThepossibilitytoreceivesupportfromtheEuropeanOperationalPro-

grammeEnterpriseandInnovationwasfullyopenedtocompaniesthatde-cidedtoinvestinresearchanddevelopmentintheCzechRepublicin2008.Seventy-fivecompaniesimmediatelymadeuseofthePotentialProgramme,whileanother25firmsdecidedfortheICTandBusinessSupportServicesProgramme,whichsupportssoftwaredevelopmentandtheestablishmentofexpertsolutioncentresandhigh-techservicecentres.Inaddition,stateaidisbeingusedtosupporttheestablishmentofshared-servicescentresandoneresearchanddevelopmentcentre.“Itisveryimportantthatweareabletooffertailoredsupporttomany

typesofcompanies.Ifwedidnothavethisability,arangeofcompaniesthatwearetalkingabouttodaywouldhavesetuptheiroperationsinneighbour-ingcountries,”addsRudyšarová.

Two out three investors are based in the Czech Republic“ThegreatestnumberofnewinvestmentprojectsinwhichCzechInvest

tookpart lastyearhavetheirorigins intheCzechRepublic,”Rudyšarováemphasises.“CompaniesbasedintheCzechRepublicprepared127newinvestmentsinthetotalvalueofnearlytenbillioncrowns.Theseinvestmentswillcreate4,054newjobs.Inaddition,everythirdnewlycreatedpositioninCzechcompanieswillbeoccupiedbyaspecialistwithauniversitydegree.”According to the statistics for 2008, investments undertaken direct-

ly by Czech companies rank first both in terms of the number of newprojects aswell as in total investmentvolumeand thenumberofnewlycreated jobs. “The statistics show that every second investment projectonwhichweworked last year originated in the Czech Republic,” addsRudyšarová. According to the number of investment projects, investorsfrom Germany, with 29 projects, placed second behind Czech compa-nies,followedbycompaniesfromtheUnitedStatesinthirdplacewith14investments.

South Moravia leads the way, thanks to ITAs in 2007, the greatest numberof new investments last yearwas in

theSouthMoraviaregion,whichwaschosenby35companies,one-thirdofwhichoperate in theareasof ITandsoftwaredevelopment.With30new projects, the second most popular region among investors wasMoravia-Silesia, though the largest number of new jobs (2,912) will becreatedthere.CentralBohemiafinished2008inthirdplacewith27newinvestments.

CzechInvest: 17 years of supporting investment in the Czech RepublicCzechInvestwas established in 1992 andmediated its first invest-ment project for theCzech Republic a year later. Since then, theagencyhastakenpartin1,193investmentsinthevalueofCZK647billion.ProjectsmediatedbyCzechInvest havedirectly resulted inthecreationof202,461newjobs.Thousandsmorejobshavebeencreatedinconnectionwithrelatedinvestments.

Stepanska15,12000Prague,CzechRepublic

Phone:+420296342500,Fax:+420296342502E-mail:info@czechinvest.org

NumberofprojectsmediatedbyCzechInvestin2008bytypeofactivity

NumberofprojectsmediatedbyCzechInvestin2008bycountry

Research and development

36%

Services27%

Manufacturing37%

Japan, Korea3%

United States7%

Germany14%

China, Taiwan1%

Other2%

Israel1%

Poland1%

Belgium, Netherlands2%

Czech Republic60%

NumberofprojectsmediatedbyCzechInvestin2008bysectors

mechanical engineering17%

metal-working and -processing

6%

electronics and electrical engineering11%

chemical and pharmaceutical11%

rubber and plastics3%

IT and software development

21%

business support services centres

6%

food production3%

wood-processing and paper1%

other7%

automotive13%

biotechnology and medical technology

1%

France2%

Great Britain2%

Italy, Cyprus, Spain5%

22 >> Business Climate

competitiveness and now plays a signifi-cantroleintheCEEregion.Ifweleaveasideagivencountry’sstra-

tegiclocationandinfrastructure,theedu-cation level of its inhabitants, its interestratesandbasicmacroeconomicindicators,on the basis ofwhich a potential foreigninvestormaydecidetoinvestinthatcoun-try, an important criterion is indisputablythe administrative burden faced by com-panies.CzechPOINT,oneofthecompo-nent parts of the comprehensive eGON(eGovernment) system, is the most vis-iblemanifestationoftheelectronisationofpublicadministration.

Czech POINTCzech POINT is a project intended to

reducetheexcessiveamountofredtapeinpublicadministration.Untilthesystemwaslaunched, a citizen or representative of aforeigninvestorhadtovisitseveralofficestoresolvejustoneproblem.CzechPOINTservesasalocationforperformanceofpub-licadministration,enablingcommunicationwith the state at a single, universal pointof contact, which brings obvious benefitsforeveryoneconcerned.Thegoalwas tocreate a comprehensive service for com-municationwiththestateviaoneuniversalofficewhereitwouldbepossibletoobtainandverifydatafrompublicandnon-publicinformation systems, notarisedocuments,transferprinteddocumentsintoelectronicformandviceversa,obtaininformationonthecourseofadministrativeproceduresinrelationtothecitizenandtosubmitmate-rials forcommencementofadministrativeprocedures.Thisinvolvesthemaximaluseof information in thestate’spossession inordertominimisetherequirementsplacesoncitizens.The Czech POINT project significantly

eases communication with the state. Insome situations it will suffice to visit onlyoneoffice.Inthefinalphaseoftheprojectitwillbepossibletohandlethesemattersviatheinternetfromone’shomeoroffice.

What Czech POINT provides:ExtractsfromthePropertyRegisterExtractsfromtheCommercialRegisterExtractsfromtheTradesRegisterExtractsfromtheRegister ofCriminalRecordsAcceptanceofsubmissionspursuant totheTradeLicensingAct(Section72)Applicationsforextractsortranscripts fromtheRegisterofCriminalRecords

Welcome to the Czech e-Republic

Until the launch of the Czech POINTsystem,thiswasatypicalsituation.Thanksto this new system, however, today it isnecessaryonlytofindthenearestpostof-fice,whereyoucanobtaina rangeofof-ficialextractswhileyouwait.

This yearmarks the twentieth anniver-saryof theVelvetRevolution.During thepasttwodecades,theCzechRepublichastransformeditselffromacentrallyplannedto an export-oriented market economy.Thecountryhassubstantiallyimprovedits

A few years ago the following conversation could frequently be heard in Czech companies:

Business manager: “Do we need to complete any more materials before submitting our offer for the tender?” Consultant: “I still have to request extracts from the

Commercial Register and Register of Criminal Records.” With a power of attorney, the young consultant would then

head to the relevant authorities, which were scattered around the city, and spend hours standing in a queue, only to find out

later that the extract from the Commercial Register could not be issued on the spot.

23>> Business Climate

pursuanttoActNo.124/2008Coll.ExtractsfromtheRegister ofTrafficViolationsIssuanceofverifieddatafrom theListingofQualifiedSuppliersSubmissionstotheregister ofparticipantsintheoperation oftheISOHwrecked-vehiclesmoduleCzechPOINTE-SHOP–extractsviapostOn16February2009at9:05:53a.m.an

extractwiththecuriousnumber1234567wasissuedatabranchoftheCzechPost-al service. This was an extract from theRegisterofTrafficViolations,whichisthethird most commonly used by citizens,accounting for 14.02% of the overallnumber of issued extracts. The Registerof Criminal Records leads with 44.68%,followed by the Property Register with25.52% of issued extracts. Between thebeginning of the year and 16 February2009, 28,597 extracts from the RegisterofTrafficViolationswere issued. Intotal,1,417,978extractshadbeenissuedby31March2009.

EGONGreaterdemandsarenowbeingplaced

on existing information technologies andtheir further development within thestate administration. This stems prima-rily fromtherequirementsofbuildingane-state, i.e. electronisation of the agen-das required for the proper running ofthe state, forwhich it no longer sufficesto have individual information sourcesand individual provision of services. It isnecessary to have overall mutual coor-dination of the development of informa-tionsourcesinordertofullyfacilitatetheperformanceofusers’necessaryactivities(eitherwithin thestateadministrationoronthepartofitsclients–citizens)fromasinglelocation.Thebrainof eGONcomprises theba-

sic registersof thepublic administration.Thesewill serveasa sourceof themostfrequently used information in the per-formanceof public administration. In to-tal,fourbasicregisterswillbeestablishedalongwithaninformationsystemensuringtheinterfacebetweentheseregisters.The inability to share data and to en-

sure the secure sharing of data by stateadministrativebodiesisthebiggestprob-lematthistime.Therefore,thenextstepin the eGovernment project is to launchthe project establishing the four basicregisters–registerofinhabitants(dataonnaturalpersons);registerofentities(dataonlegalentities,naturalpersonsconduct-ingbusiness,andbodiesofpublicauthori-

ties), register of territorial identification,addressesandproperty;andaregisterofrightsandresponsibilities.The basic register of inhabitants con-

tains information both on citizens of theCzech Republic and on foreigners resid-ing here. Information on natural personswill be maintained on a smaller scalethan is the casewith records of inhabit-ants maintained in the information sys-tem,becausethebasicregistershouldbeaccessible to a broader group of officesthatdonotneedmoredetailedpersonalinformationfortheireverydayoperation.Intheregisterofinhabitants,informationonnaturalpersonswillbemaintaininthefollowingscope:name,surname,residen-tialaddress(inthiscaseonlyalinktothebasic register of territorial identification,addresses and property will be used sothatif,inthegivenlocation,thenameofastreetchanges,forexample,theuserwillalways be shown the current data withthecorrectname),dateandplaceofbirthanddeath(whereasinthecaseofplaceofbirththerewillagainbeonlyalinktothebasic register of territorial identification,addressesandproperty).Information on the territory of the

Czech Republic is among the most fre-quentlyusedinthepublicadministration.Thisparticularlyconcernsinformationonaddressesthatmostpublicadministrativebodies need when conducting their ac-tivities. However, a range of these bod-ies also use information that defines thelocationofaterritoryontheground.Thefrequencyofuseorthenon-existenceofasinglesourceofinformation,whichshouldguarantee the correctness, precision andthoroughnessof such information, led tothe decision to create the basic registerofterritorialidentification,addressesandproperty.Thebasicregisterofentities(ROE)cov-

ers thecreationofonereferencesource–aregisterofentitiesthatwillincludealltypesofentities(economicunitsandenti-ties)ofabusinessaswellasnon-businesscharacterandintegrallinkingofindividualrecords(structure,classification,locationand means of registration, communica-tion interface, verificationand inspectionofdata,updatinganduseofdata).Amongotherthings,thiswillmakeitpossibleforall public administrative bodies to haveavailable a single source of uniform andverifieddataonentitiesmaintainedintheROE. The reference data in the registerofentitieswillconcernentitieswithintheCzechRepublic.Unlike the basic registers described

above, the registerof rights and respon-

sibilities ismuchmoredifficult todefine.It comprises twomain areas, the first ofwhich is the competency of public ad-ministrative bodies (from the legislativeperspective, offices do not have rightsandresponsibilities,astheyonlyperformactivities stipulated by legal regulations).The second area involves the rights andresponsibilitiesofnaturalpersonsandle-gal entities. The purpose of this registeristocreateaspacethatwillgraduallybefilled with information on the rights andresponsibilitiesmostfrequentlyexercisedonthepartoftheoffices.Theregisterofrights and responsibilitieswill contain anoverview of the activities performed bypublicauthorities, informationontheof-ficesthatconductthegivenactivitiesanddefinitionof the roles that arenecessaryinordertoconducttheseactivities.Forabodytofunctionproperly,itneeds

notonlya“brain”intheformofthebasicregisters, but also a “heart”,which con-sistsofaninformationsystemofdatabox-es.An actdraftedby theMinistryof theInteriorwhichcameintoforceinSeptem-ber2008governstheareaofdataboxesaswellastheconversionofdocumentsfromelectronictoprintedformandviceversa.Forbothindividualsandfirms,databoxeswill simplify electronic communicationwith administrative offices while ensur-inggreaterreliabilitythanisthecasewithordinarye-mailcommunication.Whenanindividual or firm has a data box set up,theofficeswilldeliverdocumentprimarilyto the box. In two-way communication,public administrative bodieswill have anobligation to use the electronic form ofcommunication via data boxes. This willlead to lower costs andhigher efficiencyof the activities conducted by the publicadministrativebodies.Theelectronisationofthestateadminis-

tration–eGovernment–willcomprehen-sively facilitate communication betweenprivateentitiesandadministrativeoffices,whichwillleadtotheimprovedefficiencyof processes on both sides, a reductionof costs associated with these activitiesand, primarily, to the greater attractive-ness of the Czech business environmentintheeyesofpotential foreigninvestors.Thankstothisproject,theCzechRepub-lic will rank among those countries thatapply modern information technologiesnotonlyfortheirownbenefit,butmainlyforthatofbusinessentitiesandtheirciti-zensingeneral.

Martin Michalov,Association for Foreign Investment

24

dustrialisationand,therefore,theestablishmentandgrowthofnewtowns.Theregion’smostwell-knowngenius loci in in-

arguably iron and steel (thoughOstravawas longpresentedas the steelheartof the republic).ThesmalltownofVítkoviceontheOstraviceRiverhadthebestconditionsfortheestablishmentofthefirstsmelter(attheRudolfIronworksin1828)notonlyintheCzechlandsbutintheentireHabsburgEmpire.The fast-flowing Ostravice River offered hydro-power,nearbySilesianOstravaprovidedtheblackcoal,andironorewasbroughtinfromtheBeskydydeposits.In the 19th and 20th centuries coal mining was

expandedtotheentireOstrava-KarvinaBasinandmore steelmillswereestablished inTřinec (1839–Třineckéželezárny)andOstrava-Kunčice(1949–NováHu,nowArcelorMitall).Unfortunately, reckless coal mining and the in-

tense concentration of heavy industry had a verynegativeimpactontheregion’snaturalenvironmentintheformofsoildegradation,slagheapsandhighconcentrationsofpollutantsintheair,waterandsoil.After1989,stepsweretakentoreversethistrend,often throughclosureofobsoleteplants,andcoalmining inOstravawashalted in1994.Devastated

Moravia-Silesia and its surroundingsTheregionislocatedinthenorth-easternpart

ofthecountry,morethan300kmfromPrague,andborderstheŽilinaregionofSlovakiatotheeast and Polish Opole voivodeship and heavilyindustrialised Silesian voivodeship to the north.Moravian-Silesian’sneighbours to the south andwestaretheCzechRepublic’sZlínandOlomoucregions,respectively.ItisnecessarytopointoutthattheborderswithSlovakiaandPolandarenotbarriersastheywereinthepast.Followingacces-siontotheEUandSchengenarea,newopportu-nitiesforcooperationhaveopenedupinarangeoffields(trade,education,travel,culture,etc.).

Diverse scenery and natural wealthFrom the physical-geographical perspective,

Moravia-Silesia isverydiverse.Theregion’s low-estpoint(at195metresabovesealevel)liesneartheOdraRiverontheborderwithPoland.Fiftykilometrestothewest,however,wecometothe“theroofofMoravia”–Praděd,thehighestpointof the Hrubý Jeseník mountain range, at 1,492meters above sea level. Praděd is well-knownduetothepresenceofCentralEurope’sbiggestsnowcap.Thewesternpartoftheregionisfringed

>> Region Focus

bytheHrubýJeseník,whichgentlygradates intorollinghills–NízkýJeseníkandOderskévrchy.The region’s naturalwealth consists of its high-

qualityfarmlandintheOpavskánížinaandMoravskábrána areas and the large amountofmineral rawmaterialsfoundhere(blackcoal–Ostrava-KarvinaBasin, limestone, gypsum, granite, slate, sand andgravel).

Industry and investment: history and present Covering5,427km2,Moravia-Silesiaisthesixth

biggestregionintheCzechRepublicintermsoflandarea,andishometoover1.2millionpeople,whichmakesitthecountry’smostdenselypopu-lated region, though even in this respect thereareenormouscontrasts. WhiletheOstravaag-glomeration (Ostrava, Havířov, Karvina,Orlova,Bohumín, etc.), has 1,000 residents per squarekilometre,theOsoblahaandRýmařovareasarepractically devoid of human settlement and un-touchedbyindustry.Black-coalminingintheOstravaareadatesback

totheendofthe18thcentury,whichalsosawtheestablishment of the region’s first steel mills andmachineshops,whichbroughtaboutexplosive in-

In the past, Moravia-Silesia, in the northeast corner of the Czech Republic, was often neglected, overshadowed by more well-known regions of the country. In recent years, however, that has changed and Moravia-Silesia is

now the fastest-developing region in the republic. This is thanks not only to the massive inflow of foreign invest-ments, but also to the explosive development of the region’s traditional producers, which through restructuring

have become much more competitive and have thus established themselves on global markets.

Ostrava

Moravia-Silesia:a region of many contrasts

and opportunities

25

scheduledservicetoPragueandVienna.Thehighquality of education in Moravia-Silesia constitutesanother benefit for existing and newly incominginvestors.Emphasisisplacedonclosecooperationbetweenthemanufacturingindustryandtertiaryed-ucationalinstitutesinordertoproducehighlyquali-fiedgraduates.Theregionalsooffersafullrangeofsecondary schools (high schools, business acad-emies,languageschoolsandtechnicalschoolspro-viding education in various engineeringdisciplines)andfouruniversities,thelargestbeingtheTechnicalUniversityofOstravawith19,000studentsreceivingeducation ineconomics,electricalengineeringandinformatics,mechanicalengineering,mining-geologyandmetallurgyandmetalsengineering.UniversityofOstravaeducatesstudentsinthefieldsofnaturalsci-ences,philosophy,pedagogy,healthcareand socialsciences,andamedicalschool isbeingestablishedthere.TheothertwouniversitiesintheregionareSilesian University (Opava, Karvina) and BusinessSchoolOstravaplc.WiththeOperationalProgrammeResearchand

DevelopmentforInnovation,threeofthelocaluni-versitiesarepreparingtoestablishacentreofexcel-lenceunderthenameIT4Innovations.Thisinvolvesauniquesuper-computercentrethatwillbefocusedonmodernfieldsofscienceincludingmechatronics,biomedicine,securityengineeringandnanotechnol-ogy.Theprojectwillleadtoasignificantconcentra-tionofresearchcapacitiesintheITandotherinno-vative sectors in the region, thus contributing notonlytoeconomicdevelopment,butalsotostrongerlinksbetweenbusinessandacademia,moreeffecttransfer of technologies and the establishment ofnewspin-offfirms.

Leisure activitiesBeyondbusiness,Moravia-Silesiaoffersanabun-

danceofentertainment,sportingandculturalactivi-tiesforspendingone’sleisuretime.Inwinterdown-hill and cross-country skiing are easily available,while in summer a dense network of cycling andhikingtrailsgivevisitorsandresidentsanopportunitytoenjoytheregion’snaturalbeauty.Golfenthusiastswillfindhigh-qualitycoursesinČeladná,Ostravice,Šilheřovice,KravařeandRopiceuTřince.Moravia-Silesia iswell-known for thenumerous

cultural and sporting events that take place here.TheregionhashostedWorldChampionshipsinicehockey, floorball and volleyball and the EuropeanChampionship in indoorfootballandothersports.Eachyear,morethan100world-musicartistsandroughly 20,000 fans from aroundCentral EuropecometotheregionfortheColoursofOstravafes-tival.LoversofclassicalmusicparticularlyenjoytheBeethovenandJanáčekfestivalsheldinHradecandHukvaldy,respectively.Ostrava’stheatresceneiswell-knownthanksto

the Moravian-Silesian National Theatre and PetrBezručTheatre.

Filip Chlebiš,CzechInvest

Praděd

Opava - museum well-preparedindustrialzones.Forexample,Brose,DuraAutomotiveSystems,ErichJaegerandRieger,setupoperationsintheKopřivniceindustrialzonetosupplyforVolkswagen,OpelandarangeofotherEuropeanautomotivefirms.FollowingthedecisionoftheKoreancarmakerHyundaitobuilditsfirstEu-ropeanplantinNošovice,severalofthecompany’ssuppliersfollowed(SungwooHitech,Dymos,Plakor,Hysco,Donghee,Sejong,PHA,Matador-Dongwon,HanwhaL&C).ProductionoftheHyundaii30wasofficiallylaunchedattheendof2008;anestatever-sionwillbeintroducedthisyear.Other new investments in the region include

thoseofOsramBruntál(finewireandspools,light-ingcomponents),ShimanoKarvina(bicyclecompo-nents),MölnlyckeHealthCare (single-use surgicalsupplies), Central European Aircraft MaintenanceMošnov(aircraftrepaircentre–Boeing,Saab,etc.),TietoOstrava (softwareandapplicationsdevelop-ment),Bang&OlufsenKopřivnice(consumerelec-tronics),ASUSOstrava(productionandassemblyofcomputer components), HSBC Ostrava (businesssupportservicescentre,softwaredevelopment)andGEMoneyBankOstrava(call-centreandbusinesssupportservicescentre).For new investors and established firms inter-

ested inexpanding,Moravia-Silesiaoffersabundantindustrialzones(Mošnov,Karvina,Krnov,Studénka,Rýmařov)andpreparedrentalfacilitiesforproduc-tionandlogistics(CTPParkOstrava,NovýJičín,Pro-LogisParkOstrava-Poruba,SEGROOstrava-Přívoz).ForITandBSSprojects,afullrangeofmodernof-fice spaces is newly available (AXIS ParkOstrava-Hrabová,OrchardOstrava,NordicaOstrava) andotherofficeprojectsarebeingimplementednotonlyinOstrava.Innovativecompaniesthatwanttocloselycooperatewith the academic sphere can also findhigh-qualityfacilitiesinthenewlyestablishedBusinessIncubatorattheTechnicalUniversityofOstrava.

High-quality infrastructure and educationAkey factor for the successfulentryandeffec-

tiveoperationoffirmsintheregion ishigh-qualityinfrastructureandthuseasyaccessibilitytosuppliers.Untilrecently,Moravia-Silesiasufferedfromthelackofanhighway linking it to therestof thecountryandtoneighbouringstates.Today,thesituationhasimprovedsomewhatwiththeopeningofasectionoftheD1highwaylinkingOstravatoBrno,andthustoPrague,Vienna,andBratislava(finalcompletionisscheduledfortheendof2009).Anotherhighwayisunderconstructionandwillconnect theregiontothePolishroadnetwork(A1–Gliwice,GdanskandA4–Krakow,Wroclaw,Berlin).Ofcourse,feederroads,citybypassesandaccess roads to industrialzonesarealsobeingbuilt.Ajeweloftheregion’stransportinfrastructureis

thehigh-speedPendolinorailservicefromOstravatoPrague.Trainsalsorundailytootherregionalcen-tresintheCzechRepublicandtherearedirectlinestoWarsaw,Krakow,BratislavaandVienna.LeošJanáčekInternationalAirportinMošnov(20

kmfromthecentreofOstrava)providesregularly

locationswerecleanedupandrecultivatedandonecanagainseefishermenandrowersontheOstraviceRiverinthecentreofOstrava.The region’s economy has never relied solely

onheavy industry, as companieshere represent abroadspectrumof sectors, including theautomo-tive industry (Tatra Kopřivnice – freight vehicles,AutopalNovýJičín–lightingtechnology,Continen-tal Automotive Systems Frenštát pod Radhoštěm,BranoHradecnadMoravicí–doorsystems,jacks),mechanicalengineering(ŽDBBohumín–steelca-bles,cords,heatingtechnology;BonatransBohumín–rail-vehicleaxles,VOPŠenov–modernisationoftanks, MSA Dolní Benešov – armatures), miningtechnology(OstrojOpava,FerritFrýdlantnadOs-travicí),thechemicalindustry(IvaxPharmaceuticalsOpava–drugs,WalmarkTřinec–foodsupplements,BorsodChemMCHZ–aniline,BochemieBohumín–disinfectants),thefoodindustry(OpaviaOpava–biscuits; Kofola Krnov – non-alcoholic beverages,Bivoj Opava –meat products, NowacoOpava –frozen foods), and breweries (RadegastNošoviceandOstravar).Theregion’seconomyalsofeatureshighly specialised companies such Rieger Kloss, amanufactureroforgansinKrnov,andTONAKNovýJičín,whichproducesfelthatsandfezzes.Thedeclineofproductioninthe1990sandneces-

saryrestructuringresultedinmassivelayoffs,whichculminated in 2004when the region’s unemploy-ment rate reached 16%. Fortunately, this trendwas reversedwhen new investments, particularlyin theautomotive industry,beganflowing intotheregion,largelythankstoinvestmentincentivesand

>> Region Focus

26 >> Focus on Universities

university’s cooperation with companies andsupport for innovation,was completed in June2008,whenitbeganoperationwithaworkshoptitledResearchandDevelopmentforInnovation,InnovationforBusiness.Thebusiness-incubatorbuildinghadpreviouslyservedforapresentationoftheregioninMarch,whenwewelcomedtheEuropean commissioner for regional develop-ment,DanutaHübner.TheconceptoftheCAIT,animportantpartof

theinfrastructureforeffectiveapplicationofR&Dresults, was progressively promoted throughCAIT workshops in cooperation with leadingCzechandEuropeanspecialists.Thefirstwork-shopwas conducted in February 2005 on theTUOcampusundertheauspicesofIng.MartinJahn,deputyprimeministeroftheCzechRepub-licandchairmanoftheGovernmentCouncilforResearchandDevelopment.ThesecondannualworkshoptookplaceinFebruary2006undertheauspicesofLindaDuffield,ambassadorofGreatBritain.Theevent featured theparticipationofDr.AlexSmeets(directorofSt.John’sInnovationCentre,Cambridge),Dr. JonCox (manager ofthe Oxfordshire Investment Opportunity Net-work, Oxford Innovation) and Dr. GeraldineBarry (director of theTechnologyTransfer andScientificCooperationDepartment,Brussels),as

Reform of tertiary education in the CzechRepublic sets a demanding task for the coun-try’sinstitutionsofhigherlearning–conceptualestablishment of modern third-generation uni-versities.Universitiesserveasasourceofhighlyskilledworkers,whereas the investmentof re-sources inhighereducationhasfar-reachingef-fectsonsocietybydirectlyinfluencingthequalityof education, research and development, andservices. Inconnectionwith thechangingpara-digmsoftheroleofuniversitiesinsociety(LisbonProcess,ERA)andinaccordancewiththelong-term focusof theMinistryofEducation,YouthandSport(MEYS)andreformoftertiaryeduca-tion,theimportanceofuniversities’thirdroleisgrowing,particularlywith regard to their com-petitiveness and development. In this respect,oneofthekeyareasforcreationofaddedvalueanddevelopmentofuniversities’servicesforthebroaderpublicconsists inthe infrastructureforknowledge transfer,which is thebasicelementof support for innovation processes leading toeffective application of research and develop-ment findings in the commercial sphere. Fromthe state’s perspective, importance is attachedto new inventions andproducts resulting fromthecreativeendeavoursofuniversities.Thiscon-cernsnotonlycreationandpublication,butalso

protectionof intellectualpropertyandtargeteddevelopmentsothattheseresultscanbeputintopracticeandbecomepartofexistingornewlyes-tablishedinnovativefirmswithintheprocessesofcreatingmarketvalue.Withrootsdatingbackto1716,theTechnical

University ofOstrava is one of theCzechRe-public’s leadinguniversities. In1849 the schoolreceivedanimperialdecreeandthisyeariscel-ebrating the 160th anniversary of its establish-ment.TUOhaslongbeenengagedindevelop-ing the necessary conditions for the effectivepractical application of research and develop-mentfindings.An importantpartof theschoolwasandstill isthebuildingof infrastructureforthedevelopmentofcooperationwiththecom-mercialsphere.ThisinfrastructurecomprisesthetechnologypavilionsoftheCentreforAdvancedInnovationTechnologies (CAIT).TheCAIT-TL1applied-researchlaboratoryandTUO’sbusinessincubator represent a unique infrastructure intheCzechRepublic.Forexample, thebusinessincubatorwasestablishedwithintheProsperityProgramme(partoftheOperationalProgrammeIndustry andEnterprise) at a costofCZK220million; aid from the Ministry of Industry andTrade (MIT) amounted to CZK 148,790,000.The incubator, which is a key element of the

Technical University of Ostrava and cooperation with industry

Focus on the IT4INNOVATIONSCentre of Excellence

Technical University of Ostrava

27>> Focus on Universities

wellasrepresentativesofcompanies,theMEYS,MIT,theCouncilforResearchandDevelopment,CzechInvestandotherorganisations.The2007CAIT workshop, under the title Incubation ofCompaniesandSupportfortheDevelopmentofInnovativeBusiness,focusedontheconstructionofthebusinessincubator.WithintheTechnicalUniversityofOstrava,a

uniqueinfrastructureforconnectingtheacademicandcommercialspheresisbeingdeveloped,thuscreating an importantbasis for effective useof ERDF (EuropeanRegionalDevelopmentFund)resourceswithinthe Operational Pro-grammesEducationforCompetitiveness andResearch and Devel-opmentforInnovation(OPEC,OPRDI)inor-dertofulfiltheconver-genceprioritiesof theEuropean Union. Theuniversity is activelypreparing projects inindividualpriorityaxesof the OperationalProgrammes focusingon its strengths and competencies. Emphasisis placed on interdisciplinary research activitiesbringingforthunconventionalnewideasthatarenecessaryforthedevelopmentofinnovation.OneofthemostprestigiousOPRDIprojects

being prepared by TUO involves cooperationwith Ostrava University, Silesian University inOpavaandtheInstituteofGeonicsoftheAcad-emy of Sciences of the Czech Republic. Thisuniqueproject,calledIT4INNOVATIONS,hastheaimofbuildinganationalcentreofoutstand-ingresearchintheareaofinformationtechnolo-gies.Thisnewlyestablishedcentrewillmake itpossibletoconcentratea fullrangeofscientificfields relating to information technologies andthustoenhancetheirdevelopment.Amongoth-erthings,theprojectwillinvolvetheacquisitionofasupercomputerthatshouldbeputintooper-ationin2013andshouldrankamongtheworld’s100most powerful supercomputers (currentlytheCzechRepublicdoesnothaveevenonesu-percomputerintheworld’stop500).TheIT4Innovationscentreofexcellenceshould

functionasa topresearchcentre foracademicpurposeswhilealsoconductingresearchthat isapplicable in thecommercial sphere.Thebasisoftheplannedcentrewillbecomputing,whichisrankedaheadofotherscientificdisciplinesandcategorisedinfourmutuallyrelatedkeyareas:

1. IT4People (Information Technology for People) IT4People is focusedon improving the gen-

eralpopulation’squalityoflifethroughmodern

informationtechnologies.Withinthisarea,TUOhas already realised initial successes with theFLOREON+project,which involves a uniquesystemthatenablesmodellingandpredictionofthedevelopmentoffloodscenarios.Theresultsoffloodpredictionshouldbeavailabletoabroadspectrumofspecialists(crisis-relieforganisations,municipalauthorities,etc.)thatintheeventofacrisissituationorthreatthereofwillbeinformedviaadvancedvisualmeans.Itshouldbepossible

to display the provid-ed informationof anydevice,i.e.notonlyina centre with state-of-the-art technology,but also on mobiletelephones. Every-onewhoneedstobeinformed of a floodsituation,forexample,will be able to obtainmaximuminformationand thus properly as-sessthesituation.ItisexpectedthatFLORE-ON+ will be usedthroughouttheCzechRepublic and abroad,though the large vol-

umeofdataprocessedduringsimulationsplacesextremedemandsonthecomputerequipment.Similar modelling and simulations, using theGSMnetworkandGPStechnology,areusedformonitoringtrafficinOstrava.Simulationsofpol-lution,firesandecologicalhazardsarealsobeingdeveloped.

2. SC4Simulations (Supercomputing for Simulations) The second key area is focused on super-

computing – research and development ofnewmethodsandalgorithmsforcomputationalmathematics.Supercomputingisanintegralas-pectofhigh-quality researchanddevelopmentinawiderangeoffields,includingmedicineandbiomechanics,inwhichsupercomputingisusedfor optimising the designof rehabilitation aids.Duetoeconomicreasons,inthemechanical-en-gineeringandautomotiveindustriessupercom-putingisincreasinglybeingusedforsimulationsin optimising the shapes of products,whereasthe potential of algorithms in strength calcula-tions is widely used. For example, a projectimplemented by researchworkers at TUO incooperationwithStanfordUniversityresultedinthedevelopmentofalgorithmsthatenableopti-misedperformanceofenginesusedinFormula1cars.

3. EC4Innovations (Embedded Computing for Innovations)IT4Innovations is not only about supercom-

puting, but also involves its connection with

small-scale computing. Research and develop-ment of sophisticated embedded systems ap-plied in interdisciplinary solutions, e.g. in inno-vativemedicine, is only a further extension ofthe use of these systems,which currently areapartofnearlyalladvanceddevicescommonlyinuse,suchasmobiletelephones,cars,aircraftand many others. Interdisciplinary research intheareaofbiomedicineincooperationwiththeUniversity Hospital is uncovering many non-traditionalapplications (photoelectricalplethys-mography, nanopathology in connection withtheNanotechnologyCentre,etc.).

4. Theory4IT (Theory for Information Technology)Focusedonbasicresearch,Theory4ITisopen-

ing up the possibility of further developmentin the three previously mentioned areas. Thisinvolves new fields such as bioinformatics, softcomputing,formalmethods,etc.Itispossibletodocumenttheapplicabilityofformalmethodsinstandardpracticeatcrisiscentres,wherewithinemergency events these methods comprise atoolforresolvingcrisissituations,i.e.proceduralprocessing of acquired information (e.g. tel-ephoneconversations)andtransferofresponsi-bilitytotheexactalgorithmsthatovercometheinadequacy of human reasoning in emergencysituations.Thebenefitofthesupercomputercentrecan

be seen in thepossibility toperformextensivescience-research calculations that increase thecompetitivenessofentitiesusingthegiveninfra-structure, forwhich it iscurrentlynecessarytogoabroad.Potentialusersofthecentreincludeindustrial organisations such as Vítkovice, SaabGroup,IVAX,theUniversityHospitalinOstravaand a range of others. For example,Olympuscould use the data centre’s infrastructure tohandletasksintheareaoftelepathology–scan-ning, evaluation and transfer of samples (onesuchsamplecanbe30GBinsize).Roughly200employeeswillworkattheIT4INNOVATIONScentreofexcellence,whereasinthecourseofitsconstructionspecialists fromotherareasofthecountryandfromaroundtheworldwillbehired.Thecostsofimplementingtheprojectin2010-2015 are estimated at CZK 2 billion. PartnersoftheprojectwillendeavourtoobtainfinancingfromEUstructural funds,particularly from theOperationalProgrammeResearchandDevelop-mentforInnovation.Theprojectdocumentationiscurrentlybeingprepared,andfinalapprovaloftheprojectbytheEuropeanCommissionisex-pectedinthefirsthalfof2010.

Vladimír Kebo, Vice-Rector for Cooperation with Industry

Ivo Vondrák, Dean of the Faculty of Electrical

Engineering and Informatics

Whatisasupercomputer?

Asupercomputerisgenerallyconsid-ered to be a very high-performancecomputerthathasvastlyhighercom-puting power than an ordinary com-puters.Supercomputersarecurrentlyused for solving the most difficultresearch and development problemsthroughsimulations,andtheirimpor-tance is continually growing. There-fore, if theCzech Republicwants tobe competitive, it must ensure thatresearch workers and others haveaccesstoasupercomputer,thusena-bling them to perform computation-allydemandingtasksinvariousfields.

28 >> Spotlight on People

Cosmopolitan connections

Why did your company decide to in-vest in the Czech Republic? Praguebecamethelocationofchoiceafter

fulfilling several criteria including the avail-abilityofaskilledandflexible labourforce,English in common use, well-establishedand reliable telecommunications networks,good air linkswith Europe and the rest oftheworld,theopportunitytoreducecosts,and favourable investment incentives fromtheCzechgovernment.

Are you happy with your Czech employees? Yes,verymuchso.Thespecific skill sets

requiredforourcomplexITsystemsarebe-comingmoregenerallyavailableonthelocallabourmarket both as a result of increas-ing numbers of qualified graduates as wellasCzechnationalsreturninghomefromfor-eignassignments.Do you cooperate with any of the lo-cal secondary schools or universities to attract employees and ensure that they have the skills you require? We cooperate regularly with the major

Czechuniversities suchasCzechTechnicalUniversityandtheUniversityofEconomicsintheiractivitiestoattractnewstudentsintheITareaandtoprovidecareeropportuni-tiesfortheirgraduates.Weparticipateregu-larlyincareerfairsattheuniversitiesaspartof our graduate recruitment program.Wealsooccasionallyofferpart-timejobstouni-versitystudentstoenablethemtoaugmenttheirclassroom-basedknowledgewithreal-worldexperience.

Your centre covers all of the EMEA countries, so you presumably need people who speak many languages?We require proficiency in English for all

employees at DHL IT Services and havenot facedanydifficulties infindingqualifiedcandidateswith this knowledge on the lo-calmarket.WerequireadditionalEuropeanlanguages,suchasGermanandFrench, forour Service Desk, which responds to re-quests forassistance fromtheusersofourservicesinEurope.Evenfortheselanguageswe are able to findqualified candidatesonthe localmarket. IcreditthistotheCzech

Republic’smembershipoftheEuropeanUn-ion, the growing involvement ofCzechs ininternationalbusiness,andPrague’sincreas-ingly cosmopolitan society which attractscitizensfromacrossEurope.

You employ people of many nationa-lities. What attracted these people to the Czech Republic?Our team in Prague consists of people

from more than 60 different countries. Inmanycases this isdue torequirements forveryspecifictechnicalskillsnotavailableonthe localmarket.There isalsoabenefittohavingaculturallydiverseworkforce. Ital-

lowsustoapproachproblem-solvingfromawiderangeofperspectivesandbetterequipsourorganizationtoserveourglobalcustom-ers. You’d have to ask each of our foreignemployeeswhytheywereattractedtotheCzechRepublic,butIbelievethethemethatwould emerge would be the comfortablestandardof living,therichculturalheritageandsociallife,andPrague’sconvenientloca-tionattheheartofEurope.

Czech wages are going up. Is this a threat to your operations here?So far this has not been an issue.Natu-

rallywearealwaysconcernedwithmanag-ing our costs; however, the recent globaleconomicsituationhasledtoamorestableenvironment. In addition, we are able totakeadvantageofimprovementsincomput-ingtechnology,suchasvirtualizationof thehardware environment, which continue toenablegainsinproductivityandcounteranyinflationarytrends.

Is the current global economic downturn going to have any effect on companies like yours?Webelieveitwillstrengthenfunctionslike

sharedITservicesthat leverageeconomiesofscaleandcentresofexpertisetoprovideeconomicandcompetitiveadvantages.DHLIT Services, which specialises in managinginformation technology and the IT infra-structure,candemonstratetheabilitytore-ducecostswhiledelivering improvedserv-ice,benefitswhicharekeytoanycompany’ssuccessinthemarketplace.The Czech Republic has undergone massive changes in the last two de-cades. Nevertheless, is anything still missing? Since DHL IT Services is in the busi-

ness of providing reliable, predictable andcost-effectivecomputingdevelopmentandoperations services to the Deutsche PostDHLgroup,wevaluestabilityandpredict-ability in ourworking andoperational en-vironment. The Czech Republic has beenable to provide this environment to dateandwehaveeveryreasontobeconfidentthatthiswillcontinuetobethecaseinthefuture.

An interview with Pascal Adam, Head of Transaction Services, DHL Information Services (Europe)

Pascal Adam, Head of Transaction Services

Pascal Adam, a French national,movedtotheCzechRepublicin2003tooverseetransactionservicesat theDHL Information Services centre forthe Europe, Middle East and Africaregion.DHL IT Services (Europe) is one of

themostimportanthubswithinDHLITServicesworldwide.Thecompanyoper-atesastate-of-the-artdatacentrehous-inghundredsof serversandprocessingmillionsoftransactionsperday.Praguewasselectedasthe location

for the IT centre out of 60 potentiallocationsalloverEurope.ThedecisiontolocatethecentreinPraguewasan-nouncedinMarch2003andthecentrebeganoperationsin2004.Itcurrentlyemploysover1,000peoplerepresent-ingover60nationalities.

29>> Spotlight on People

What advice would you give to forei-gners who are sent by their employer to the Czech Republic?Well, I think that for an expatriate it is

important to learn about the country andnottrytoreplicatetheirpreviouslife.Thehistoryandmentalityaredifferent,buttheCzechRepublicisreallyinthecentreofEu-ropeso it iseasy totravelback ifyouaremissingyourhomecountry.But IpromisethiswillhappenlessandlessifyoudiscovertheCzechlifestyle.

What is your favourite place in the Czech Republic?I have a particular affinity for Vyšehrad

inPrague;walkingthereattheweekendisveryrelaxing.Also,ofcourse,ČeskýKrum-lovoutsidethetouristseason.Butdefinite-lymypreferredplaceismyapartmentwithmyfamily. It isnowoursecondhomeandevenfromtimetotimeourmainoneaswespendmoretimeherethaninthesouthofFrance.

ed.

DHL IT Systems – DHL – Deutsche Post World Net

DHLITServicesbelongs to theGlobalBusinessServicesdivisionofDeutschePostWorldNet.TheGBSdivisionbundlesall

commonandnon-business-specificservicesandprovidesthematcostandatworld-classservice levels totheentireDPWN

group.

DHLITServicesdeliversend-to-endITsolutionsandsupportforthecompany’sITinfrastructureconsistingofnetworks,hard-

ware,operatingsystemsandapplications.Thecompany’soperationsaredividedintothreegeographicalregions:

•ITServicesEurope(officesinPrague,CzechRepublicandBonn,Germany)

•ITServicesAmericas(officesinScottsdale,Arizona,USA)

•ITServicesAsia-Pacific(officesinKualaLumpur,Malaysia)

DHLisawhollyownedsubsidiaryofDeutschePostWorldNet(DPWN),theworld’sleadinglogisticsgroup.Itsintegratedcom-

panies–DeutschePost,DHLandPostbank–employover500,000fulltimeemployeesworldwide.

The Park office campus in Prague hosts shared services and other operations of Accenture, Computer Associates, DHL, Honeywel etc.

30 >> Events

CeBIT,theinternationalICTindustry’sleadingevent,tookplaceinHan-nover,Germanyfrom3to8March2009.Aswithotherbigtradefairs,Ce-BITsawadeclineinattendancethisyear.Fewerexhibitors(4,300,roughly25%fewer than in2008)andvisitorsshowedthat theworldeconomiccrisishasleft itsmarkontheICTsectortoo.Cutsinmarketingbudgetshaveparticularlyaffectedsmallandmedium-sizedAsiancompanies.“Giventhedepthoftheglobaleconomiccrisis,thenumberofexhibitorsisasuc-cess.Inviewoftheoverallbusinessenvironment,weareextremelysatis-fied,”saidErnstRaue,memberoftheboardofdirectorsatDeutcheMesse.“CompaniesexhibitingatCeBITaredemonstratingthattheyareingoodshapeandwanttoputtherecessionbehindthemquickly.AtCeBIT2009thegoalis–nowmorethanever–todevelopnewbusinessandactboldlyvis-à-visthefuture.”Thekeyfocusthisyearwason“greenIT”,i.e.energy-efficientITsolu-

tions,aswellasonthecontinueddevelopmentoftheinternet,asepito-mizedby thebuzzword “Webciety”.CeBIT also featured all aspects ofbusinessITsolutions,includingrisk-managementandbusiness-intelligenceapplicationsandsafetyaspectsoftheITworld.CeBITisnotonlyaneventwhereyoucanfindplentyofnewICTtech-

nologiesandsolutions.Itisbusinessesandinvestorsfromaroundtheglobethatarelookingfornewopportunities.Theimportanceofthiseventwasdemonstrated by the attendance of German Chancellor Angela Mer-kel,whoopened thisyear’sexhibitionandCalifornianGovernorArnoldSchwarzenegger.CaliforniabecameapartnerofCeBIT thisyear, repre-sentingmorethan100companiesmainlyfromSiliconValley.TheCzechRepublicleftitsmarkonCeBITaswell.Morethan15ICT

companiespresentedtheirinnovationsandideas.CzechInvestsentitsrep-resentativestokeeptabsonnewtrendsintheICTsectoraswellastofindnewpotentialinvestors.TheynoticedtheincreasinginterestofinvestorsfromtheICTindustryinlearningmoreaboutthebusinessenvironmentandpotentialoftheCzechRepublic.Lastyearalone,CzechInvestattracted43newinvestmentprojectsfocusedonsoftwaredevelopmentorITservicesandthisyearitwouldliketoincreasethisnumber.Intermsofthenumberofinvestmentprojectsattractedtothecountry,ICTsurpassedtraditionalsectorsliketheautomotiveindustryandmechanicalengineeringin2008.

Tomáš Hanáček,CzechInvest

HereareonlyafewinnovationsthatwereintroducedinCeBIT2009:

CarradiospresentedbyBlaupunktcanreceivehundredsofthousandsofstationsworldwidethroughtheinternet.AlltheseuniquedevicesneedtogetonlineisaBluetooth-enabledmobilephone.

VodafonepresenteditsGoogleG2mobilephonewiththeAndroidoperatingsystem.

Laptops are getting smaller and smaller, but they arepacked full of technology. Acer presented its first ten-inchnotebookfittedwithIntel’snew1.66GHzprocessorwhichcanbeequippedwith2GBofRAM.

MicrosoftreleasedatestversionofthesuccessortoVis-ta:Windows7.Thehighlightfeaturesofthenewoperat-ing system are billed as simplicity, reliability and speed.Critics are unanimous in saying that the new operatingsystemrunslikeadream.Installationisfast,memoryre-quirements are lower, and it consumes less energy thanitspredecessor.

Thefactthatcomputersinstand-bymodecontinueusingelectricityunlessyouactuallyunplugthemisalong-stand-ingproblem.FujitsuSiemensdemonstratedasolutiontothisproblemwithaworldpremiereof0-wattcomputer,whichusesnopowerinstandbymode.

Intel presented a new generation of processors basedon the new Intel Core microarchitecture. The particu-larly powerful Core i7 965 Extreme Edition (3.2 GHz)improvesperformancebyup to40%without increasingpowerconsumption.

CeBIT 2009: the global economic crisis leaves its mark

CEBIT 2009 CEBIT 2009

31

Afterarecord2008,whenthesumptuousMIPIMenticedexhibi-torsandvisitorswithluxury,the2009eventwasmarkedbyacertaindisenchantment.Asmallyetveryrevealingdetail–whilethemod-estheliportattheendofthepierstrainedunderconstanttake-offsandlandingsofhelicopterslastyear,thedistinctivesoundofrotorswasheardonlya few timesaday thisyear.Thenumberofyachtsanchorednearbyalsodeclinedsomewhat.Andthenumberofvisi-tors–18,000fromeightycountries–waslessthantwo-thirdsoflastyear’stotal.Inspiteofthelowernumberofvisitors,bothCzechsegmentsfea-

turednumerousmunicipal,regionalandprivatedevelopmentprojectsandarangeofimportantmeetings.Therelativelackofvisitorspara-doxicallyresultedinhigherqualityandintensityofindividualmeetings.Representatives of CzechInvest were thus in a favourable positionwhenafteraslightcollapseofinvestmentsfocusedpurelyonEasternEurope,i.e.mainlyUkraineandRussia,manyinvestorsbeganinquiringabouttheCzechRepublicduetoitsstabilityintheCEEregion.Themostnumerousvisitorsincludedrepresentativesofinvestors,

banksandfundsthathavemoneytodayandseeanoutstandingop-portunitytogrababigpieceofthemarketandincreasetheirprofits.Asopposedtolastyear,ontheotherhand,therewerefewerexpan-sion-mindeddevelopersofbusinessproperties;inspiteofthis,how-ever,therewasarangeofmeetingsfocusedmainlyonconstructionofindustrialandofficespacesintheregions.Thus,thereisachancethat class-Aofficesmayarise in the regions inmixedprojects alsoinvolving retail and residential spaces. If individual projects can becombinedwithregenerationofmunicipalbrownfields,wemustcon-siderthisasagreatsuccess.Amongarchitectsanddesignerstherewasalsoalargenumberofpartiesinterestedinextendingtheirserv-icestotheCzechRepublic,whichtheyincreasinglyperceiveasapart

>> Events

ofWesternEuropewithitsbusinessregulations.Anotherimportantpartofthetradefairconsistedinmeetingswithexistingclientsandpartnersandstrengtheningofcooperationbetweenourrespectiveorganisations.EachyearMIPIMtraditionallyconcludeswiththeMIPIMAwards

fortheworld’sbestprojectsofthepastyearinfivecategories:ad-ministrativecentres,renovatedofficebuildings,projectsfortheho-telandtourismindustries,residentialprojectsand“greenbuildings”forenvironmentallyfriendlyprojects.ApointofinterestisthattheCzecharchitectandformerpoliticianJanKaslisatraditionalmem-berofthejury.Thisyear’soverallwinnerwastheconversionoftheformerHighburystadiumintotheHighburySquareresidentialarea.MIPIMisoneoftheworld’sbiggestandmostimportanttradefairs

focusedonrealestateandinvestmentinthissegment.It isthusanidealopportunityforpresentingprojectsfromtheprivateandpublicsectors across the real estatemarket, fromconstructionof hotelsandgolfcourses, throughregenerationofold industrialcomplexesandconstructionofnewindustrialpropertiesandofficebuildings,toregenerationofentirecitydistrictsandvisionaryprojects involvingtheconstructionofvalleysofskyscrapersbeyondtheUralsaccord-ingtothedesignsofNormanFoster.Forvisitors,thetradefairoffersthepossibility togather information, formopinionsonthecurrentsituationduringthemanydiscussionswithspecialistsand,mainly,tofindsuitableopportunitiesforenteringthemarketandinvesting.AtMIPIMone canmeetwith representatives ofmunicipalities,majorconsultingfirms,banks,developmentcompanies,architects,design-ersandotherentitiesthatoperateontherealestatemarket.

Milan Kratina,CzechInvest

MIPIM 2009 descent from Olympus

Winners, MIPIM 2009

32 >> Spotlight on Project32 >> Living Czech

Statistics convincingly show that in the kitchenmostCzechsgiveprioritytooneofthefollowing:porkwithdumplings and cabbage, beef in creamsauceorgoulash.ThesearethemostpopularfoodsforeightoutoftenCzechs.Andthedrinkofchoiceis, of course, beer. In fact, Pilsner takes its namefromtheWestBohemiancityofPlzen,wherethistypeofbeerwasfirstbrewed.

Regional specialitiesIftheCzechRepublicdoesnothaveonespecific

national cuisine, itdoeshavea lotof local speci-alities, including several protected by the Euro-peanUnion, such asHorice Rolls in east-centralBohemia, Karlovy Varywaffles in the northwest,OlomouccurdcheeseincentralMoraviaandmanymore.Themostwidespreadregionalspecialityisfresh-

water fish. Czechs have a long tradition of fish-farming,particularly in southernBohemia,whereone will find a network of interlinked artificialpondsandcanalsinwhichfishareraised,primarilycarp(anothergreatside-dish forbeer)aswellasmanyothertypes.WhereasinmanyotherplacesinEuropepeople

lookdownabitoncommerciallyraisedfish,thanksto their centuries-old tradition of fish-farmingCzechstendtoviewharvestedwildfishwithsuspi-cion.Incidentally,friedcarpwithpotatosalad(andbeer)isthetraditionalCzechChristmasdinner.Re-gionaltraditionsmeanthatcarpfromrestaurantsin

the fish-farming townofTřebonislovedbythosewho otherwise simplycannotstandfish.

Michelin Morning-starThe biggest problem

with Czech food is thefact that nobody knowshow to cook it. That is,they don’t know howtocook it inrestaurants.Home-cookedporkwithdumplings and cabbageisadelicacy.During fourdecades of communistrule,trainingprogrammes

forcooksandwaiterswerethelastresortforyoungpeoplethatcouldnotgetintootherschools.Thiswasquiteaparadox,asundercentralplanningstarchefshadincomeswellabovetheaverage.Fortunately, this situation now belongs to the

past.LastyearPraguecelebratedtheawardingofthefirstMichelinstarforalocalrestaurant,AllegroattheFourSeasonshotelwithitsItalianchef.Thisillustrates thatCzech gastronomy as awhole hasdecidedlytakenaturnforthebetterinthepasttwoorthreeyears.AnotherMichelinstarwasawardedtotheres-

taurantMazeattheHiltonOldPraguehotel.MazewasestablishedbythegastronomicalcelebrityGor-donRamseyandthusattractedMichelin’sattentiontoPrague.Sixmonthlater,however,RamseysoldMaze,alongwithanumberofhisotherrestaurantsaroundtheworld.Praguelostagoodrestaurantbutthere are certainly plentymore pleasant eateriesthatdeservetheattentionoftheFrenchproducersoftheMichelincatalogue.

Where to eat wellOnonehand,therearetheaforementionedre-

gionalspecialities thatarebestservedathome intheirrespectivebirthplaces–fishinsouthernBohe-mia,wafflesinthenorthwest,wineinthesoutheast.On the other hand, there are restaurants.Here,unfortunately,itstillappliesthatitisnotaproblemtowander intoasmokypubwheretheheightofculinaryartisdrychickenwithpeachesandcheese

servedwithalotofstalegarnish.Nevertheless,theseestablishmentsareslowlybutsurelyraisingtheirgameandputtingpressureonrestaurantswhere the cooks actually know how to cook.Morethananywhereelse,intheCzechRepublicabasicruleisthatifamenuhasmorethantwoorthreepages,thebestoptionissimplytorunaway.Perhapsthemostexpansive,reliableguideto

restaurantsintheCzechRepubliccanbefoundatwww.grand-restaurant.com.Butifyoudonothaveaccesstotheinternet,thissimplebitofad-vicemayhelp:atypicalCzechfoodisHungariangoulash.Thereisn’tmuchtoit,soit’shardtoruinitanditisavailableinmostrestaurants.Andifit’salreadyadayoldwhenyoueat it, that’swhenit’sthebest.

Jiri Sochor, CzechInvest

Czech cuisine: an exceptional mix of tastes

There is no such thing as Czech cuisine. If you ask ten Czechs about their national food, you will get eleven different answers. Located in the heart of Europe, the Czech Republic is a culinary melting pot of influences from Germany, Austria, Hungary and practically everywhere else. The result is an interesting mix of tastes even though it is true that

the country’s cuisine mostly consists of heavy, rich foods, but only if you know how to make them properly.

Goulashforfourpeople

Ingredients:400g pork shoulder, 3 onions, 2 spoons ofsweetpepper,pinchofhotpaprika,2clovesofgarlic,strainedtomatoes,(ground)cloves,(ground) cumin, bay leaves, allspice,marjo-ram,pepper,salt

Slicetheonionsintoalargepotandlightlyfrytheminoil.Quicklybrownthecubedporkontheonionsandaddspicesandgarlictotaste.Fryforamaximumofoneminutesothatthepaprikadoesnotbecomebitter.Adda littlewater and let it simmer (approx. 60 min-utes).Addtomatoes,morewaterandspicetotaste,andthickenwithflowerdissolvedinwaterinaseparatecup.Letsimmerforap-prox.20minutes.Goulashisbestservedwithdarkbreadorbreaddumplings.

Goulash

YOUR CZECH E-GUIDEYOUR CZECH E-GUIDE

CzechTourismwww.czechtourism.com

Association for Foreign Investmentwww.afi.cz

USEFUL CONTACTSUSEFUL CONTACTS

CzechInvestwww.czechinvest.org

CZECHREPUBLICE-mail:info@czechinvest.orgPhone:+420296342500Štěpánská1512000Prague2CzechRepublic

FRANCEE-mail:paris@czechinvest.orgPhone:+3315624877218,rueBonaparteCentretchèqueF-75006ParisFranceGERMANY-MUNICHE-mail:munich@czechinvest.orgPhone:+498999216362Feringastrasse685774MunichGermany

GERMANY-COLOGNEE-mail:cologne@czechinvest.orgPhone:+492211612145Hansaring6150670CologneGermanyJAPANE-mail:tokyo@czechinvest.orgPhone:+813348603292-16-14Hiroo,Shibuya-kuCzechCenter2F,CzechEmbassyTokyoJapanSOUTHEASTASIA–HONGKONGE-mail:southeast-asia@czechinvest.orgPhone:+8522530880689Queensway,AdmiraltyRoom2207-9;TowerII,LippoCentreHongKong

U.K.&IRELANDE-mail:london@czechinvest.orgPhone:+4420729146101HarleyStreetW1G9QDLondonUnitedKingdomU.S.A.-CHICAGOE-mail:chicago@czechinvest.orgPhone:+13122450180222MerchandiseMartPlazaSuite938Chicago,IL60654U.S.A.

Contact: iva.stribrska@afi.cz, martin.michalov@afi.czEditorial Board of Czech Focus, Association for Foreign Investment, Štěpánská 11, 120 00 Prague 2, Czech Republic PublishedbytheAssociationforForeignInvestment-AFIundertheauspicesofCzechInvest,theInvestmentandBusinessDevelopmentAgencyoftheMinistryofIndustry&Trade,CzechRepublic.

Moravian-Silesian Regionwww.kr-moravskoslezsky.cz