Czech Business and Trade 3/2010

CZECH SCIENTISTSDISCOVERA UNIQUE COMPOUNDHOWTO CONCLUDELEASE AGREEMENTSUNDER CZECH LAW?MORAVIA-SILESIAREGIONTRANSCRIPTION OFSPONTANEOUS SPEECHCZECH SUPPORTFOR FILM MAKERS 32010

CONGRESS – ENTERTAINMENTGOLF – RELAXATION – WELLNESSCENTRUMBABYLONPROVIDESTHEIDEALENVIRONMENT FOR COMBINING A CON-GRESS WITH ENTERTAINMENT AND SPORT.THE CONGRESS SPACE ALLOWS FORA NUMBER OF VARIABLE USES, INDIVIDUALHALLS HAVING CAPACITIES OF BETWEEN10 AND 950 PERSONS. EACH HALL OF-FERS A UNIQUE ATMOSPHERE. CUSTOM-TAILORED ACTIVITIES ARE A MATTER OFCOURSE, AS ARE OUR ACCOMMODATINGSTAFF, ABOVE-STANDARD GASTRONOMICSERVICES, AND A HELPFUL APPROACH TO-WARDS YOUR REQUIREMENTS.WE INVITE YOU TO BRING YOUR FAMILYAND FRIENDS ALONG TO REVIEW OUR FA-CILITIES. BESIDES TOP QUALITY HOTEL SERV-ICES, CENTRUM BABYLON OFFERS A WIDERANGE OF ENTERTAINMENT OPTIONSFOR ALL AGE GROUPS. LUNAPARK FORTHE YOUNGEST, IS STYLED LIKE AN OLD-FASHIONED CZECH FAIR. OLDER VISITORSCAN ENJOY iQPARK – AN INTERACTIVECENTRE OF SCIENTIFIC FUN — AND THETHEMATICALLY ORIENTED AQUAPARK.THE WELLNESS CENTRUM WITH A WIDESELECTION OF PROCEDURES ON OFFER INAN ANCIENT SPA ENVIRONMENT, IS ANINDISPENSABLE PART OF THE COMPLEX.THE JEŠTĚD GOLF CLUB IS AN ESSEN-TIAL PART OF CENTRUM BABYLON. IT HASAN INTERESTING TERRAIN, LOCATED BE-LOW THE JEŠTĚD RIDGE. EACH OF THE 9HOLES OFFERS A UNIQUE PLAYING EXPE-RIENCE AND SURROUNDINGS. THE GOLFCOURSE EVEN HAS AN AREA DEDICATEDTO CHILDREN – MONKEY BARS, SEE-SAWS, IQPARK EXHIBITS, INDIAN CAMPGROUND, AND A SCOOTER RENTAL.YOU CAN SPEND YOUR FREE TIME INA NUMBER OF ENJOYABLE WAYS. CEN-TRUM BABYLON IS THE IDEAL VENUE TOCOMBINE A CONGRESS WITH SPORT,ENLIVENING YOUR BUSINESS ACTIVI-TIES WITH RELAXATION AND ENTER-TAINMENT.CENTRUM BABYLON, NITRANSKÁ 1, 460 12 LIBEREC, PHONE: +420 485 249 202, WWW.BABYLONLIBEREC.CZCENTRUM BABYLON has been awarded as the “Bes t Tourism Product in the CzechRepublic” by the CZECH TOURISM agency this year.CONGRESS HALLGOLF JEŠTĚDWELLNESSLABYRINTH

3 |C Z E C H B U S I N E S S A N D T R A D ECzech Business and TradeEconomic Quarterly Magazine witha Supplement is Designed for ForeignPartners, Interested in Cooperation withthe Czech RepublicIssuedbyPPAGENCYs.r.o.incooperationwithMinistry for Regional Development of the CzechRepublicMinistry of Industry and Trade of the CzechRepublicMinistry of Foreign Affairs of the Czech RepublicConfederation of Industry of the Czech RepublicConfederation of Employers‘ and Entrepreneurs‘Associations of the Czech RepublicCzech Chamber of CommerceCzechTradeEDITORIAL BOARD:Michal Bakajsa, Zdena Balcerová, Helena Bamba-sová, Martin Dvořák, David Füllsack, Josef Jílek,Ivan Jukl, Dagmar Kuchtová, Marie Pavlů, MartinPlachý, Pavla Podskalská, Josef Postránecký, FilipRemenec, Libor Rouček, Jiří Sochor, MiroslavSomol, Jan Špunda, Martin Tlapa, Zdeněk Vališ,Jan WiesnerMANAGING EDITOR:Šárka KratochvílováEDITORS:Jana Pike, Jaroslava BradováREGULAR COLLABORATORS:David HortTRANSLATION:Vlasta Benešová, Alena Kenclová, Robert Krátký,Dagmar Šímová, Halka VarhaníkováREAD:Matthew Booth, Pearl Harris, Ivana KadlecováGRAPHIC DESIGN:Art Director: Nina NovákováGraphic Designer: Jiří HetfleischProduction: Anežka ZvěřinováDEADLINE: 15/6/2010© PP AgencyCompany with the ISO 9001 certified qualitymanagement system for publishing servicesADDRESS:Myslíkova 25, 110 00 Praha 1Czech RepublicPhone: +420 221 406 622Fax: +420 224 930 016e-mail: journal@ppagency.czwww.ppagency.cz, www.doingbusiness.czPress run: 10 000 copies. The number of printedand sold copies of the journal is verified byauditor, PKF Audit, s.r.o., member of PANNELLKERR FORSTER Worldwide. It is not allowed toreproduce any part of the contents of this journalwithout prior consent from the editor.Attitudes expressed by the authors of articles car-ried by CBT need not necessarily be consistent withthe standpoint of the Publisher. MK ČR E 6379, ISSN1211-2208„Podávání novinových zásilek povolenoČeskou poštou, s. p., odštěpný závod Přeprava, č. j.3468/95, ze dne 24/10/1995“Cover photo: www.sxc.huNEW ATTRACTIVE PROGRAMME FOR FILM MAKERS!The Czech Republic is launching the Film Industry Support Programme. Accordingto the Ministry of Culture, the aim of the Programme is the support of film produc-tion in the Czech Republic and the increase of the competitiveness of Czech filmindustry on the European and international scale. Many global film epics werefilmed in the Czech Republic, for instance The Chronicles of Narnia: Prince Caspian,Wanted, or the Bond movie Casino Royale. Smaller producers aimed at Europeanor Asian co-productions will also profit. The impact for services such as transport,hotels, or catering will also be significant. According to the Audiovisual Producers’Association materials, each crown spent during filming will return another crowninto related services.INTRODUCTIONQuestions of the Month for Petr Nečas, Prime Minister of the Czech Republic 4ECONOMIC POLICYBack to Growth 5INVESTMENTCzech Film Industry Support Programme Launched! 7The Most Advanced Brickworks in Europe 8LEGISLATIONHow to Conclude Lease Agreements under Czech Law 9New Legislation Seeking to Reduce Administrative Burden 10WE SUCCEEDQuarter of a Century with Peat 12CZECH TOPAquasoft Team is Winning Prizes 14SERVICESKey Issues: Systems Integration and Crisis Application Implementation 16New Technology – Transcription of Spontaneous Speech 17IT in the Czech Republic is Comparable to the Developed World 18The Goal Is to Keep the Customer Satisfied 20Keeping One's Firm Safe … 20YOUNG STARScientists from Brno Discover Bambusuril, a Compoundwith Unique Qualities 22KALEIDOSCOPEIndustry is Continuing Its Revival and Helps to Boost Exports 23Fitch Raises Czech Rating from Stable to Positive 23Financial Evaluation Motivates Employees only Temporarily 23Do Czech Firms Already Feel the Signs of Economic Revival? 23REGIONMoravia-Silesia Region 24-34PRESENTATION OF FIRMSAQUASOFT spol. s r.o.; CENTRUM BABYLON, a.s.; CS SOFT a.s.; Ludmila Jílková - TORF;M.I.P. Advertising, a.s.; Moravskoslezský kraj - Krajský úřad; NOVA - AGRO s.r.o.- Hotel Santander; Sdružení pro rozvoj Moravskoslezského kraje

| 4Petr NečasI N T R O D U C T I O NYour objective and task was toform a pro-reform government com-posed of members of three right-wingparties (Věci veřejné, ODS and TOP 09).What structural reforms do you con-sider as crucial for the Czech Republic?The fundamental structural reforms in-clude primarily a pension reform and re-form of the health service. Without theseprincipal reforms we can reduce the in-dividual budget deficits, but this will notguarantee their long-term sustainability.Thereforms will ensure stable public budgetsfor decades ahead.You have said that your target for the2011 State Budget deficit is approxi-mately CZK 135 billion (EUR 5.4 billion),which is 3.6% of GDP. You plan thepublic budgets deficit for next year at4.6%, which is two-tenths lower than inthe Convergence Programme. How doyou want to achieve this?Our plan provides for the gradual reduc-tion of budget deficits with two basiclandmarks – by 2013, at the latest, wewant to attain below 3% in public budgetdeficit, and by the year 2016 we want toachieve balanced public budgets. As tochanges for next year, they will consistmainly of cuts, due to a lack of time, andnot of reforms that will be effective onlyfrom 2012. Next year, we are planning cutsin all the areas of expenditures – manda-tory expenditures, capital expenditures,operating expenditures, governmentemployee wages, subsidies to buildingsaving schemes, contributions to politi-cal parties and salaries of constitutionalofficials. The specific parameters of thedifferent cuts are contained in the Coali-tion Treaty.In a crisis, the rule for companies statesthat they can save for a while, but thenhave to find new sources of revenue.Do you have an idea of how to startgrowth in the State revenues?State revenues can be raised either byraising taxes, which the governmentcoalition refuses to do, or by increasingeconomic growth. In this area we haveprepared a number of measures, parti-cularly in support of the business sector,which is the only sector to create sus-tainable jobs. These measures include,for example, the abolition of Road Tax onpassenger cars, allowances on social pay-ments for socially endangered groups ofemployees, and VAT returns on unpaidinvoices. For details, I refer again to theCoalition Treaty. Besides reducing unem-ployment and cutting the budget deficit,a fundamental motive for our measuresis to increase the competitiveness of theCzech economy.Questions of the Month for Petr Nečas,Prime Minister of the Czech RepublicPhoto:OfficeoftheGovernmentarchives;PhotocomboArrival of the new Czech government at its seat in Prague on 13 July 2010.

5 |E C O N O M I C P O L I C YBack to GrowthAs in most of the EU countries, theCzech economy experienced a strongrecession in 2009. GDP declined by4.1% over the year, but economicindicators showed a turn for thebetter from the third quarter. In thequarter-on-quarter comparison,GDP began a continual rise of 0.5%,which continued at the beginningof 2010. The drive of the restoredeconomic growth was the export-oriented industry, which initiallybenefited from the car scrappageincentive introduced in several EUcountries. The Czech economy thusreturned to the trend of growth,which will not be rapid at first, butwill most likely be higher in com-parison with the“old”EU countries.FAVOURABLE RESULT DUE TOINCREASING EXPORTSThe growth of the Czech economy re-mained at 0.5% at the beginning of 2010,ceased to be in the red and rose by 1.1%in the year-on-year comparison. The fa-vourable result was mainly due to risingexports and to a lesser extent to govern-ment consumption and a change in re-serves. In real terms, the export of goodsand services showed a year-on-year riseof almost 13%, and imports to the CzechRepublic only 10.7%. Exports profited pri-marily from the increasing demand for au-tomobiles on the European market, whichwas confirmed by a rise of almost 27% inautomobile exports. There was, of course,the effect of the low statistical basis atthe beginning of 2009 which improvedthe year-on-year comparison, but even sothe export of road vehicles was above theaverage. The effect of the car scrappageincentive in Germany is over, but a markedrise has been recorded in exports to othercountries such as the United Kingdom,Spain, France, Italy, and Slovakia, in whichthis incentive is ending or has also cometo an end. Important are Czech exportsof electrical equipment, which rose byalmost 24%. All in all, the Czech – export-oriented – economy is benefiting fromthe present revival of European demand.The favourable development in the bal-ance of trade is also positively reflectedin the results on its current account. Theannual accumulated deficit is only 1.3% ofGDP and is easily covered by the inflow offoreign direct investment. Moreover, thisvalue includes the re-invested profits ofenterprises under foreign control, and soit is evident that the external imbalance ofthe economy is very moderate and testi-fies to a good structure of the Czech Re-public’s economic growth.LOWER DOMESTIC DEMANDThe latest figures indicate that the exportexpansion continues after last year’s mas-sive but brief attenuation. On the otherhand, imports to the Czech Republic con-tinue to lag behind the rate of exports,and for the time being are not increasedby the higher prices of imported rawmaterials. The reason rests in domesticOf the 27 EU countries, the Czech Repub-lic has the highest Gross Domestic Prod-uct. According to Eurostat 2009 data, theGDP of the Czech Republic was at 80% ofthe EU average the third year running.

| 6E C O N O M I C P O L I C YECONOMIC GROWTH (%)demand, which remains low. The year-on-year comparison shows a decline inthe consumption of households and in-vestment, which together form the mostimportant part of domestic demand. Thistrend still has roots in the 2009 recession,which noticeably influenced the devel-opment of the labour market and over-all investment. The lower demand, bothdomestic and foreign, exposed the fairlyhigh flexibility of the Czech labour mar-ket. The rate at which firms reduced thenumber of their employees and agencyworkers was unprecedented. Enterprisescould respond rapidly to the fewer orders,but at the cost of rising unemployment,which is believed to have culminated atthe beginning of this year. The numberof unemployed people exceeded halfa million and the rate of unemploymentstopped short of 10%, and thus remainedbelow the EU average. The higher unem-ployment coupled with slighter growth inwages is still creating obstacles and slow-ing down growth in consumer demand.Since households incline to save moneyin the period of increased uncertainties,their consumption has been declining forthree quarters of the year in the year-on-year comparison.... INVESTMENT ISON THE SAME WAVEInvestment also remains low. No revivalfollowed the decline of 9.2% in 2009 andinvestment dropped by 6.6% in the firstquarter of 2010. Investment into the con-struction of commercial real estate is nowjoining machinery, transport equipment,and residential real estate in the red. Lowinvestment is also connected with therecession, which caused an increase inthe share of unused manufacturing, stor-age, and other capacities. And so it waslargely a matter of cyclic developmentrather than “a burst of a bubble” as wasthe case of the US real estate market.Nevertheless, an increase in the use ofmanufacturing capacities is becomingapparent. The manufacturing industry inparticular indicates that most branchesof the industry are past the imaginarybottom. Thanks to foreign and domesticdemand, industrial enterprises are gradu-ally adding orders to their lists. The mostevident examples are the results of theelectrical engineering and automobileindustries. The improvement also ap-plies to the manufacture of basic metals,which dropped by almost 39% in the firsthalf of last year. Slower in recovery fromthe recession is engineering, which is stillfeeling the reduction in domestic andforeign investment.Economic indicators are showing thata large part of the Czech economy isgradually making up for last year’s lossesin production. Despite this, the beginningof the next wave of investment will prob-ably be delayed by one or two years. How-ever, this does not mean that the Czecheconomy would be outside the field ofvision of foreign investors. New foreigndirect investment exceeded EUR 2 billionin the first quarter of this year and thelargest amounts were re-invested profitsand repayment of credits which domesticcompanies had granted to their parentcompanies.LOW INTEREST RATESAND INFLATIONThis year again, the Czech Republic is re-taining its reputation of a low-inflationeconomy. The rate of inflation remainedbelow 1% in the first quarter in spiteof “price deregulation” and increase insome excises. The demand inflation hasvanished, and so consumer prices areinfluenced only by cost factors such asthe raw material prices on world markets,and, last but not least, the exchange rate.Due to the low inflation, which is mark-edly below the target of the central bank,the official interest rates of the Czech Na-tional Bank are at historical minimums.The main interest rate of the Czech Na-tional Bank is one quarter of a percent-age point below the main rate of the Eu-ropean Central Bank. Inflation prospectsare already indicating that the period oflow interest rates will last at least to theend of 2010. And so, low interest rateswill continue to help a more rapid revivalof the economy.There are signs that the trend of growthis back in the Czech economy mainly dueto rising foreign demand. It is not suffer-ing from any major problem requiringimmediate solution with the exceptionof the budget situation. The new gov-ernment can be expected to deal withthis problem soon and without a radicalincrease in the tax burden. In contrast tomost EU countries, the Czech Republichas the advantage of a fairly low govern-ment debt, which is no excessive burdento the expenditure side of budgets. Whenforeign demand gets going, domesticdemand should put out shoots of revivaland support both industry and services.Domestic demand could eventually fill inpossible gaps in foreign demand, whichcould come soon in consequence of theplanned cuts in the budgets of the largestEU countries.Petr DufekAnalyst ČSOBe-mail: pdufek@csob.cz2006Q1 2006Q4 2007Q3 2008Q2 2009Q1 2009Q4yearlyquarterly8.06.06.04.02.00.0-2.0-4.0-6.01.6 2.01.6 1.32.50.31.51.00.3 0.70.2-0.7-3.8-0.50.5 0.50.5Photo:www.sxc.hu

7 |I N V E S T M E N TCzech Film Industry Support Programme Launched!Film makers will get back 20% of themoney spent on film making in theCzech Republic. That is a message toboth foreign and Czech film mak-ers. They will request the return offinancing through the Czech Ministryof Culture and they have to submitthe so-called cultural test, whichwill prove whether the film hasartistic qualities. In autumn 2009the Czech government put CZK 400million (just below EUR 16 million)into a fund called the Film IndustrySupport Programme. A similar sumshould appear in this fund for filmmakers in the following years.TheCzechRepublicislaunchingtheFilmIndustrySupportProgramme.IntheEuropeanUnion the support of selected industry fieldsis a controversial issue due to market protec-tion and competition, but film is an excep-tion. After the introduction of incentives forthe film industry in not only neighbouringEU member states, the Czech Republic lostits long-time privileged position on the list ofdestinations for foreign film productions. Fiveand more years ago the situation was entirelydifferent.Atthattimetherewasnofundingforthe support of the film industry in Europeancountries and the Czech Republic was amongthe most attractive destinations of film mak-ers, who utilised the high professionalism ofCzech film workers and a wide selection oflocations. After other countries had startedto lure film makers with state-funded rebates,Czech ateliers started to languish. The larg-est decrease of production investment in theCzech Republic was between 2002 and 2008.THE NEW PROGRAMMEIS ATTRACTIVEIn June 2010 the European Commissionaverted this development by adopting theFilm Industry Support Programme. Relevantinformation for foreign investors can befound at the web pages of the Czech Minis-try of Culture – www.ppfpen.cz. Applicantscan submit their Application for supportfrom the Programme to the registry of theMinistry of Culture. According to the Minis-try, the aim of the Programme is the supportof film production in the Czech Republicand the increase of the competitiveness ofCzech film industry on the European andinternational scale. It is also an additionalsource for the financing of Czech nationalcinematography, and indirectly the Pro-gramme is aimed at the support of regionaldevelopment and support of small and me-dium-sized companies, small entrepreneurs,and professions with high added value.WHY COME FILMINGIN THE CZECH REPUBLIC?EXTERIORSThe Czech Republic has many towns, naturaland historical sights suitable for film projectsconcentrated on a small area. It is not onlyPrague, which offers a mixture of architecturalstyles, but also the interesting countrysidewith its lakes, forests, and mountains.QUALIFIED STAFFThe key asset for a large number of foreignproductions are the excellent qualificationsof staff in this sector. At the moment, foreignfilm crews are almost solely staffed by Czechworkers (for example Czech stunt performersare among the best in the world in the filmindustry and they have participated in chal-lenging scenes in many world epics such asSaving Private Ryan or Titanic) and the headsof individual crew departments are also oftenCzech.ESTABLISHED FACILITIESThe number and extent of film crews, whichis unheard of in other similar countries, alsospeaks for the sector of foreign productions– the number of capable and experiencedstage crew members is sufficient enough sothat several large productions can be takingplace in the Czech Republic at the same timeat any given moment. Established facilitiessuch as Barrandov Studios, Prague Studios, orthe Prague branch of Stillking Films are com-fortable and effective places for production.Film tradition, which is a part of the history ofthe country, has nurtured workers in the fieldof construction and set who are thanks totheir qualification capable of working fast andat a high level.

| 8I N V E S T M E N TEARLY APPLICATIONThe Programme guarantees that 20% ofeligible costs will not be paid out until the“investor–producer” invests his financialmeans into Czech services and goods. Hewill then carry out an audit of his expenses.Applications are processed in accordancewith the date upon which the applica-tions are received. This system encouragesproducers to lodge applications on time.A significant feature of the Programme isthat grants are paid after the completion ofthe project (i.e. after spending funds in theCzech Republic).The Most Advanced Brickworks in EuropeThe Czech family firm Heluz has in-vested nearly one billion Czech crowns,exactly 850 million (approx. EUR 32.1million) in the construction of a hyper-modern robotic brick-making facilityin Hevlín, South Moravia.The actualconstruction of the new plant and thetuning up of the technology took morethan two years. Currently the plant ismeeting all projected parameters.Heluz. “The manufacturing is efficientand consumes less energy than is the casein older brickworks. The technology we usemakes it possible to manufacture blocks, al-ready in one-layer walling, which meet therequirements for the circumferential con-structions of low-energy and passive houseswithout any additional thermal insulation.We manufacture nearly 40 000 such bricksa day.”GROWTH THANKS TOINVESTMENT INCENTIVESHeluz sells its products mainly in the CzechRepublic and in Slovakia. A part of the out-put, however, goes to Poland and Hungary,and also to Germany and Austria. Beforebuilding the new plant, the firm had abouta 20% share of the market, while after itscompletion its market share increased byanother 20%. “Heluz is a perfect example ofhow investment incentives help Czech firmsin conquering the European market,” saysMichal Stieber, head of CzechInvest’s invest-ment project management section.FIVE YEARS OF RESEARCHAND DEVELOPMENTBesides starting a completely new plant,Heluz steadily improves the technologies inits other plants in Dolní Bukovsko, Libocho-vice, and also in Hevlín. There, it will makea new type of brick, the development ofwhich it has been working since 2005. Theresult of its five-year development effortsis a new brick-making recipe enriched withanother biomass component – straw. Thenew mixture makes it possible to increasethe number of rows and build thinner walls,which nevertheless have excellent heat in-sulating properties meeting the conditionsfor the construction of passive houses with-out the need for additional heat insulation.In developing the technology needed forserial production of the new bricks Heluzco-operated, for example, with the TechnicalUniversity in Prague. It has invested more thanCZK 16 million (approx. EUR 605 000) in thepurchase of machines, but through CzechIn-vest it will receive CZK 5.6 million (approx. EUR223 000) in subsidies from the Innovation Pro-gramme, which is part of the EU Business andInnovation Operational Programme.HISTORY OF THE BRICKWORKSHELUZ cihlářský průmysl v.o.s. is a companyestablished in 1992. Now, after the launch-ing of its new brickworks, it has eight manu-facturing plants in three different localities.The company is the largest Czech brickmaking facility and has the second largestshare of the Czech brick market. The firm’shistory goes back to the year 1876. Duringthe less than twenty years of its presenceon the market, Heluz has made nearly 150million brick blocks, which could build some75 000 family houses.More at www.heluz.czFIFTY NEW JOBSFifty new jobs have been created in con-nection with the construction of the newplant. The building of this exclusively Czech-owned project was facilitated by the assist-ance given to it in the form of investment in-centives mediated by CzechInvest Agency.The firm meets all conditions laid down forobtaining the incentives, which was con-firmed recently by the Ministry of Labourand Social Affairs.MOST ADVANCED TECHNOLOGYUSED IN BRICK-MAKING“Thanks to the Heluz Company, the villageof Hevlín can boast the most advancedbrick-making facility, at least on the Euro-pean scale,” says the firm’s owner VladimírPhoto:www.sxc.huSELECTION OF FILM EPICSFILMED IN THE CZECH REPUBLIC:Mission Impossible (1996)Joan of Arc (1999)Hart’s War (2002)Van Helsing (2004)The Chronicles of Narnia: The Lion, theWitch, and the Wardrobe (2005)James Bond: Casino Royale (2008)Wanted (2008)Bond movie Casino Royale. Smaller produc-ers aimed at European or Asian co-produc-tions will also profit. The impact for servicessuch as transport, hotels, or catering willalso be significant. According to the Audio-visual Producers’Association materials, eachcrown spent during filming will return an-other crown into related services.FILM IS RETURNINGTO THE CZECH REPUBLICFilm producers are excited. Helena Uldri-chová, the managing director of the Audio-visual Producers’ Association, for examplesays, “It is a very positive message to thewhole film industry and a great chance tomaintain several thousands of jobs. I canconfirm that with the announcement ofthe incentive the Czech Republic’s attrac-tiveness has increased.”Many global film epics were filmed in theCzech Republic, for instance The Chroniclesof Narnia: Prince Caspian, Wanted, or the

9 |L E G I S L A T I O NHow to Conclude Lease Agreements under Czech LawAn agreement on lease of office(non-residential) premises may be,in certain circumstances, governedby other than Czech law. In practice,however, a vast majority of theagreements on lease of the officepremises in the Czech Republic isgoverned by Czech law. The ap-plicable Czech laws are still ratherrigid compared to the Europeanstandards.A lease agreement which would notmeet the specific requirements set out bythe Czech Act on Lease and Sublease ofNon-residential Premises would be consid-ered invalid. As a result of the invalidity ofthe lease agreement, the landlord wouldbe required to return to the tenant the rentpaid by the tenant under the invalid agree-ment and the tenant would be obligatedto pay to the landlord the unjust enrich-ment resulting from the use of the officepremises on the basis of the invalid legalgrounds.Under Czech law, an agreement onlease of the office premises mustbe in writing and must contain thefollowing:the subject of the lease, i. e. the specifica-tion of the relevant office premises;the purpose of the lease, e. g. use ofthe leased premises as the offices, retailpremises, etc.;thescopeofbusinesswhichthetenantisau-thorised to perform in the leased premisespursuant to the relevant public register;the amount of rent;the charges for services provided by thelandlord with the rent (service charges),which must be calculated separately fromthe rent.Failure to include any of the above-men-tioned items results in the invalidity of thelease agreement with the above-men-tioned consequences. Failure of the partiesto specify the term of the agreement doesnot render the lease agreement invalid. Insuch case, the lease agreement is deemedto be concluded for an indefinite period.It is a market standard in the Czech Re-public to include in the lease agreement anobligation of the tenant to provide the land-lord with a security in a form of a deposit ora bank guarantee.The lease expires on the date agreed in thelease agreement. Prior to that, the landlordmay terminate the lease agreement conclud-ed for a definite period for the following reas-ons: (i) use of the leased premises in breachof the lease agreement; (ii) delay of thetenant with the payment of the rent or theservice charges for more than one month;(iii) sublease of the leased premises withoutthe prior written consent of the landlord, etc.The lease agreement may state other reasonsfor the termination of the agreement.Unless agreed otherwise, the tenant mayterminate the lease agreement concludedfor a definite period if the tenant (i) relin-quishes the regulatory approvals for theperformance of the relevant business ac-tivity in the leased premises; (ii) the leasedpremises cannot be used as offices for otherreasons than due to the failure of the tenant;(iii) the landlord fails to maintain the leasedpremises in the conditions suitable for theagreed purpose of use.If the lease agreement is concluded for anindefinite period, both the tenant and thelandlord may terminate the lease agreementfor any reason or without giving reasons witha three-months notice period unless agreedotherwise in the lease agreement. If not spe-cifically agreed otherwise, neither the land-lord nor the tenant may terminate the leaseagreement as a result of the change of theownership to the leased premises.Michal Pravda, Ondřej Mánek,Wolf Theiss advokáti, s. r. o.e-mail: michal.pravda@wolftheiss.come-mail: ondrej.manek@wolftheiss.com

| 1 0L E G I S L A T I O NNew Legislation Seeking to Reduce Administrative BurdenThis article aims to provide thereader with a brief report on the ActNo. 155/2010 Coll., which amendscertain acts to improve the qualityof their application and to reduceadministrative burden on entrepre-neurs (hereinafter referred to as“theAct”or“the Amendment”), whichwas passed by the Czech Parliamentin April 2010 and comes into legalforce in August 2010.The Act is characterised bya relatively wide impact across theCzech legal order affecting acts ofboth private and public law nature.The amendments, however, sharea common objective; reducing theadministrative burden of entrepre-neurs in terms of their statutoryduties, which have turned out tobe redundant in the day-to-daypractice. For easier comprehen-sion, the impact of amendments isdivided according to the particularlegal obligations or regulationsthey affect.REDEFINITION OFTHE TERM“CONSUMER”According to existing legislation in theCzech Republic, a legal person is not ex-cluded from the scope of the term “con-sumer”. This state of affairs is, however, notentirely compliant with European law1orwith the purpose of the regulation as such,bearing in mind the fact that a legal per-son, given its nature, is hardly to be consid-ered a weaker party. The Act thus restrictsthe scope of the term “consumer” to natu-ral persons only by amending the respec-tive provisions of the Civil Code and theConsumer Protection Act2.LABELLING OF PRODUCTSIt follows from the existing provision ofSection 10 para 1 letter a) of the ConsumerProtection Act that sellers shall ensure thatproducts to be sold by them are visibly andintelligibly marked with the name of theproduct, the designation of the manufactur-er, importer or supplier, the weight, quantity,size or dimensions, and any further informa-tion that, based on the nature of the prod-uct, is necessary for its identification or use.The passed regulation reduces the amountof obligatory information to be presentedmerely to the designation of manufacturer,importer, or supplier. A label of the productshall hereafter bear additional informationonly where, based on the nature of theproduct or form of its sale, this is necessary.REMOVAL OF DUPLICATION INTHE DUTIES RELATING TO THEMARKING OF TRADE PREMISESTheActremovestheobligationsofentrepre-neurs to mark their retail outlets in conform-ity with the Trade Licensing Act and whena retail outlet is to be closed down to informthe applicable trade licensing authorityabout where claims can be settled from thescope of Consumer Protection Act due totheir unsystematic and redundant charac-ter, keeping the respective regulation in ormoving it to the Trade Licensing Act. Giventhe existing duplicity of the legal regulation,both the Czech Trade Inspection (www.coi.cz) and the Trade Licensing Offices are au-thorised to control the observation of theobligations indicated above. As soon as theAct enters into legal force, the duplicity shallbe removed and solely the Trade LicensingOffice shall be entitled to act.REMOVED REPORTINGOBLIGATIONS TO THE CZECHTRADE INSPECTIONPursuant to the provision of Section 6 para3 of the Act on the Czech Trade Inspec-tion3, a subject of an inspection shall withina defined period of time remove observeddeficiencies, their causes and harmful ef-fects of these deficiencies, or shall take im-mediate measures to remove such deficien-cies and report on them and on their resultswithin a defined period of time to the CzechTrade Inspection. The Amendment removesthe reporting duty having factually merelya formal character, no practical impact andincurring unreasonable costs on the part ofthe entrepreneurs.Furthermore, holders of intellectual prop-ertyrightsmustnolongeruponrequestsub-mit to the CzechTrade Inspection documen-tation necessary for assessment of goods orproducts pursuant to the provision of Sec-tion 8a para 1 of the Act on the Czech TradeInspection. Imposing this obligation on theowner of intellectual property right indeedseems to be redundant and an unnecessaryburden on the part of both entrepreneursand the Czech Trade Inspection. Provision ofthe necessary documentation to enable ef-fective control respecting intellectual prop-erty rights shall now be based on voluntarycooperation among stakeholders.REDUCTION OF STATUTORYDUTIES OF AN ENTREPRENEURRESULTING FROM THE TRADELICENSING ACT4One of the most positive impacts of the Actis without doubt the significant reduction ofthe amount of information to be presentedby an entrepreneur to the Trade LicensingOffice.By taking advantage of the integrationof the public sector databases, the entre-preneurs shall no longer have to presentan excerpt from the Commercial Registerwhen notifying commencement of trad-ing, as they had to so far, as the Trade Li-censing Office shall obtain all of the neces-sary information on its own. Moreover, theentrepreneurs shall not have to report allchanges concerning information and doc-uments laid down as particulars in casesof notification of the commencement oftrading or an application for a trading per-mit provided these changes are already re-corded in the respective registers.5Furthermore, the Act revokes the duty ofan entrepreneur to keep available docu-ments proving the method applied toacquire the goods on sale or the materi-als used in the provision of services in anestablishment where goods are sold ora service provided6, keeping solely the dutyof an entrepreneur to prove the above-mentioned upon request and within thetime limit set by a control body.A natural or legal person who intendsto trade (where the trade must by law benotified to the Trade Licensing Authority)shall no longer have to notify the Trade Li-

1 1 |C Z E C H B U S I N E S S A N D T R A D Ecensing Office of the date of commence-ment of trading, the date on which tradingis to be terminated (if it is intended to carryon the trade for a fixed term7), nor the dateof inception of trade authorisation, if laterthan the date of notification. The Act alsochanges the regime of an entrepreneur’snotification of the suspension of tradingto the Trade Licensing Office from compul-sory to voluntary.It is generally known that one of the gen-eral conditions to be met by natural per-sons in order to carry on a trade is that theymust be of good character. Good characteris commonly demonstrated by an excerptfrom the Crimes Register8. The Trade Li-censing Offices shall now have access tothe decisions and in reasonable cases alsoto certain sections of the criminal courts’files. Therefore, the Trade Licensing Of-fices shall have all information needed forthe purposes of complex assessment ofthe applicant’s good character, as the cur-rent extract from the Crime Register wasdeemed insufficient.CONCLUSIONFor the sake of completeness, it deservesto be mentioned that the Amendment alsoaffects other Acts, namely Act No. 61/1988Coll., on Mining Activities, Explosives, andthe State Mining Administration, Act No.156/2000 Coll., on Certification of Arms,Ammunition, and Pyrotechnic Articles, ActNo. 458/2000 Coll., on Prerequisites for thePursuit of Business Activities and on the Ex-ercise of State Administration in Energy, ActNo. 22/1997 Coll., on the Technical Require-ments for Products, and Act No. 505/1990Coll., on Metrology. As to the financial effectof the Amendment, according to the Act’sexplanatory report, the proposed changesshould save entrepreneurs more than CZK0.5 billion (EUR 20 mil.) annually. The realimpact is difficult to predict, however, anysimplification of the Czech entrepreneurialenvironment and reduction of entrepre-neurs’ statutory duties must be generallyunderstood as a positive step.Pavel ToufarLawyerČermák Hořejš Matějka a spol.Law and Patent Offices1cf. COUNCIL DIRECTIVE of 20 December 1985 to protect the consumer in respect of contracts negotiated away from business premises (85/577/EEC). 2Section 52 para 3 of the Act No. 40/1964 Coll. Civil Code,as amended and Section 2 para 1 letter a) of Act No. 634/1992 Coll., Consumer Protection Act, as amended; 3Act No. 64/1986 Coll., on the Czech Trade Inspection, as amended; 4Act No. 455/1991 Coll., theTradeLicensingAct,asamended; 5TheActextendstheinformationsourcestobeusedbytheTradeLicensingOfficeinthisrespectfromtheCommercialRegistertotheCivilRegistrationInformationSystemandthe Foreigner Information System; 6Or, if he has no establishment, at the place of business, registered office, or at the location of the organisational unit of the undertaking of a foreign person; 7The obligationof a foreign person to notify commencement of trading for a maximum period corresponding to the length of residence permitted remained; 8Or an extract from the crimes register or an equivalent documentissued by the competent judicial or administrative authority of the foreign state or of the Member State of the European Union

| 1 2W E S U C C E E DQuarter of a Century with PeatDoctor Suzan lectures on balneology atthe National College of Nature Medi-cine in Portland, USA, and visits thevillage of Krásno in the Sokolov Districtfrom time to time in quest of newknowledge. No important institute orrenowned scientist is there, but a smallfamily firm Ludmila Jílková -TORF,which rendered peat famous abroad.to find out how to process it. It dawnedon me that it behaved like meat and soI minced it. Like beef full of tendons. Youonly need very sharp knives in the mincer.Peat has ten degrees of decomposition andI already know them so well that I recognisethe degrees by touch. I can choose exactlythe structure I need for a concrete product.Since peat has so many gifts of nature, itoccurred to me that much more could bedone with it, and so I conceived peat cos-metics.The face pack came first, followed byday cream and body milk. The first responsecame from abroad – from the USA, HongKong, Japan, China and, of course, fromEurope, mainly Germany. Paradoxically, thehome market came later. "At last, peopleare beginning to realise that nature is betterthan chemistry, and that we must respect itas users”Ludmila Jílková says.WITH SULPHUR TO THE WORLDLudmila Jílková’s specific feature is that shedoes not conceive anything systematically.An immediate idea is behind all her suc-cesses. One of these came when she chat-ted with a friend who is a geologist. Whenthey spoke about lakes in a coal basin, itdawned on her: there must be sulphur!And so five years ago she extracted thefirst sample of the life-giving organic mudof sapropel. Now she is sending palletsof it to the world in the form of emulsionagainst mycoses under the Saprox mark.The largest recipients are countries withhumid climate, primarily the Bahamas. Peatcosmetics of the Ludmila Jílková - TORF en-terprise are known in the world under theSFAGNUM mark. The absolute sale hit is nota luxury cream, face pack, or body milk. Itis Saprox.REVERSED THREADThe latest success of Ludmila Jílková inthe world is the vaginal peat tampon.Peat can absorb all the problematic sub-stances which we contract, for example,in swimming pools, from washing pow-ders, or drugs and bear them in our bod-ies. A personal participant in clinical testsin Františkovy Lázně was Robert Kovarik,a gynaecologist and publicist of worldrenown who lives in Paraguay. Ludmila Jíl-ková puzzled her head over fixing a plasticapplicator on the tube for two years beforeshe suddenly got it. It was so trivial – a re-verse thread!“Whenever something turns out well,I don’t take it as my success. I rather thinkthat it is ordinary life. Doing, completing,conceiving, improving – this is how lifeshould go, isn’t it?”Ludmila Jílková - TORF357 47 Krásno, Czech Republicwww.sfagnum.czLudmila Jílková commenced work with peattwenty-five years ago. Initially she processedit and sold it as a gardening substrate. Themore often she dipped her hands into theblack-and-brown substance, the moreshe was aware of its potential and felt thestrength and energy it concealed. Thou-sands of years in marshy areas turn mossand various plants into peat bogs, in whichplant substances are perfectly preservedwithout undesirable impurities and hetero-geneous microorganisms.Peat, the purest product of nature, soonchanged its appearance in the hands ofLudmila Jílková. She reduced it to pulp, andin the form of pure substance immediatelyoffered it for use in spa facilities. She simplyturned upside down – actually simplified –the existing spa procedures. What followedwere peat wraps and baths, which could beenjoyed even at home. Spas which lack theirown source of peat are still the main buyers.The revolution in Czech balneology was notenough for Ludmila Jílková. She decided tointroduce“her”peat to the world.TEN STEPS TO HEALTHWhen one constantly dips hands into peat,begins to understand it, thinks about it nightand day, and it even becomes a teatime top-ic, it becomes a partner.“It attracts me, it hasso many excellent properties,and is constantly revealingsomething about itself. Atfirst, it was most importantPhoto:L.Jílková’sarchives

RadarsSDPS, FDPS,Safety NetsMultitrackerACARS / ATNnetworkATCO HMICPDLC communicationADS position reportsATC system(Compass)DatalinkPlotsSatellite VHFSystem Track

| 1 4C Z E C H T O PAquasoft Team is Winning PrizesAquasoft, a Czech IT company, hasbeen on the market for fifteen years.Aquasoft manufactures customsystems, mainly for state institutionsand large enterprises. The companydesigns, develops, and suppliesextensive information systems thatsupport specific processes, manageinformation about entire companydivisions and business areas, andsort and analyse large amounts ofdata. Aquasoft appears to be reallysuccessful in its field.ent and only offer what is really needed.Such long-term relationships provide the cli-ents with a feeling of trust. Aquasoft has notlost a single client during its entire existence.The overwhelming majority of business rela-tionships are longer than 5 years, and severalimportant clients have been with Aquasoftfor over 10 years. Quality relationships basedon trust set Aquasoft apart from its compe-tition. Aquasoft has proven its experience inover 100 successfully realised developmentaland integration projects.AREAS OF OPERATIONFor the state administration, Aquasoft spe-cialises in supplying extensive informationsystems in the following areas: customsoperations, tax and fines administration,subsidy administration, food safety, admin-istrative action, and control activities. Theseprojects include, for example, the informa-tion system for the export, import, and tran-sit of goods, registry of agricultural animals,a system for efficient conduct of administra-tive action, etc.In the commercial sphere, Aquasoft chieflyworks with companies whose main businessis based on project realisation. Besides ITcompanies, these include, for example, con-sulting and construction firms, developers,and also the development and constructiondivisions of production companies.Aquasoft is not limited to the Czech mar-ket, it also operates abroad, especially inTurkey, where a project aimed at preparingTurkey in the area of customs for the mem-bership of the EU has been completed re-cently. Another project in the same country,related to food safety, has just started.HELP FOR HOSPITALSHealth care has been the area of main inter-est for Aquasoft recently. There are manytechnologies readily available today thatcan radically simplify all administrative tasksand speed up access to documentationfor health care employees. However, hos-pitals do not use them, or not to their full-est potential. The integration of individualscattered information systems representsa problem for virtually all hospitals, eventhough quality solutions are available.QUALITY OF COMPANYCULTURE RECOGNISEDThe thing that makes Aquasoft really spe-cial is the 120 highly qualified professionalswho work here. Aquasoft has succeeded inbuilding a well co-ordinated team of peoplewho can rely on each other both profession-ally and personally. Their work and successis based on inventiveness and creativity,education and experience, determinationand reliability. The relations between em-ployees are reflected in their contact withcustomers.The fact that Aquasoft possesses a team ofmotivated and loyal employees is evidencedby low employee fluctuation and the repeat-edplacementofAquasoftintheTop10oftheprestigious list, Best Employer of the CzechRepublicintheSmallandMediumBusinessescategory.This study is put together by HewittAssociates every year. The study serves as anindicator of the success of company cultureand the complex work in the area of humanresources control. It is, after all, the employeeswho decide the results. Aquasoft enables itsemployees to actively influence the activi-ties within the company, and the employeesappreciate the open communication andfriendly company culture.Lenka Knoflíčková,Aquasoft,e-mail: l.knoflickova@aquasoft.eu,www.aquasoft.euEBA NOMINATIONAquasoft was nominated for the prestigiousEuropean Business Awards (EBA) this year.The EBA is awarded by the HSBC World Bankand its goal is to find and give recognitionto companies from different fields with out-standing business approaches. 3 500 com-panies from the whole of Europe enteredthis year‘s competition, but only 175, withAquasoft among these, have been chosenfor the second round. Aquasoft has thus be-come one of the only 10 nominated compa-nies from the Czech Republic.CUSTOMER APPROACHAll new information systems by Aquasoft are,from the very beginning, developed in closeco-operation with customers. The matter isso complicated that clients are often unsureof their demands. A concrete specification isworked out, on the basis of a detailed analy-sis of the client‘s needs, a search for an opti-mum solution, and the client‘s requirements.Aquasoft listens to its clients and speaks thelanguage they understand.The“only”remain-ing thing is finding a solution, developing anapplication, installing it into the client‘s exist-ing systems, and subsequent testing. Admin-istration and maintenance of the applicationis guaranteed for the time of its use.KNOWING THE CLIENT WELLAquasoft prefers long-term co-operation toone-time orders. Long-term co-operationallows to deepen our knowledge of the cli-General Manager of Aquasoft, Mr Petr Franc (centre),accepts the European Business Awards 2010 nominationAWARDS:2010 – nominated for the European Busi-ness Awards, Aquasoft one of 10 compa-nies representing the Czech Republic.2010 – 2008 Top 10 in the Best Employ-ers of the Czech Republic, Small andMedium Businesses category.2009 – 2006 Microsoft Industry / Technol-ogy Awards.“Winner”or ”Finalist”.2010, 2008 – 2006 – The Best Case Studyof theYear by Business World.Photo:Aquasoftarchives

inzerceHe’s got a great sense of rhythm, butfor something else...you’ll get to like himHe and his team can handle your complex ITprojects with the greatest of success.We create custom-made software applications for:www.aquasoft.euThe health sector State institutions Large companiesZdeněk Hřibtop senior business consultantamateur drummer

| 1 6S E R V I C E SKey Issues: Systems Integrationand Crisis Application ImplementationICT Union is a professional associationof firms operating in the area ofinformation and telecommunicationtechnologies representing the CzechRepublic’s ICT industry.To find outabout its aims, we approached itsexecutive director, Mr Ladislav Mahn,and asked him the following questions.processes in wider contexts. “IT strate-gy”is becoming increasingly important, thesame as strategic business plans.Another important shift is towards out-sourcing both as regards IT applications orIT infrastructure and IT support in general.Which IT services are currently most indemand on the Czech market?The requirements for the faultless function-ing of IT infrastructure still dominate, butkey importance is being attached increas-ingly to systems integration and the imple-mentation of crisis applications. As regardsefficiency, special requirements are placedon“on demand”services.Is there any strong trend influencing theIT sector?A strongtrendiscloudcomputing,althougha number of important issues in this areaobviously need more clarification, especiallyas regards the ensuring of service standardsand data protection.As for the requirements placed on IT ex-perts, special demands are the mastering ofintegration skills, project management anda“solution” approach – overall IT supportadded value.How did economic recession affectthe Czech IT market?Investments in backend systems were cut,thedevelopmentoftheinfrastructuresloweddown, while demands for greater efficiencyof the information systems and safety rose.Efficiency includes requirements for integra-tioninstrumentsandthesupportoftheecon-omic management of companies (supportof financial decision-making, support of thecustomer-supplier relationship).Is it difficult for a foreign IT firm wishingto do business in the CR to find expert pro-grammers speaking foreign languages?Currently, partly thanks to the economicsituation, it is no problem to find program-ming experts on the Czech market speakingforeign languages.The question remains theprice/performance ratio, which depends onprojects for which the experts are sought.How are Czech IT firms faring on foreignmarkets?Czech firms are faring well, as shown by ICTexport figures (CZK 360 billion/approx. EUR14.4 billion in 2008) and ICT services CZK 31billion/approx. EUR 1.24 billion in 2008).As an example, I would like to mentionproducts of Czech firms operating in thearea of anti-virus SW, application solutionsfor customs proceedings and for bookingand sales systems of airline companies andtravel offices.ICT Union intends to join the project of theCzechRepublic’snewexportstrategyfor2011-2016 currently being developed by the Min-istry of Industry and Trade. As part of our ICTexport support, we are planning to organiseour own ICT meetings and presentations indifferent countries in co-operation with Czechgovernment institutions, collect and supplyinformation concerning exports (informationserviceforICTUnionmembers)andparticipatein exhibitions and trade fairs in foreign coun-tries, establish close co-operation with exportorganisations in the CR and take advantage ofusing their services and know-how.Do IT firms draw money from EU funds?Members of the association do draw moneyfrom EU funds, in particular the “Marketing”and“ICT and Strategy Services”programmes(in the framework of the Business and Inno-vation Operational Programme); the ICT Un-ion itself has applied for a subsidy from theHuman Resources and Employment Opera-tional Programme.In May 2010 the European Commissionrevealed its digital economy strategy.What are the current priorities of ICTUnion?One of our aims is to make a significant contri-butiontothedevelopmentoftheCzechecon-omy so as to help to raise the Czech Repub-lic’s competitiveness to the highest possiblelevel and build an innovative and knowledge-based society. As a professional association offirms in the area of information and telecom-municationtechnologies,welargelyrepresentthe Czech Republic’s ICT industry and help topromote the efficient use of ICT in all spheresof life in the CR.This, in our view, is a conditionnecessary for building a society based onknowledge and innovation. We are co-au-thors of essential reform projects, legislation,and key decisions aimed at the developmentof ICT in the Czech Republic and are partnersto state regulatory institutions.We are a pragmatic and efficient associ-ation, which means that we want to submitrealistic and practical suggestions that willbring benefits to many areas, not just theICT industry.When recalling the situation in IT a fewyears ago – which were the main prob-lems firms had to cope with in compar-ison with their current tasks?Today, the approach to meeting the require-ments for IT support (HW, infrastructure, in-tegration, application) are assessed increas-ingly in terms of added value and efficiency,havinginmindthebenefitsofITinvestmentsfor the firm’s business. IT managers respons-ible for IT operation are becoming CIO’s withresponsibilities for the contribution IT willmake to the company’s business, and sup-pliers are turning into long-term partners,who must be skilled in doing business andknow the customers’culture. Increasingly inthe focus is conceptuality and the linkageof investment in IT to the efficiency of keyPhoto:www.sxc.hu

1 7 |C Z E C H B U S I N E S S A N D T R A D EIts main emphasis is on the possibility ofhigh-speed Internet and the strengthen-ing of an unlimited online market in musicand film. What tasks will ensue from thatstrategy for the Czech Republic?Maybe as a coincidence, at practically thesame time (10 June 2010) ICT Union pub-lished its programme document called ICTIndustry Strategy in the Czech Republic.The document, which is in harmony withthe strategic document of the EuropeanCommission, was prepared in co-operationwith experts from the ICT Union’s memberfirms.For illustration, I would like to say a fewwords about the content of our document.In it, among other things, ICT Union identi-fied the main barriers preventing the fasterdevelopment of information and communi-cation technologies, specifically the inade-quate development of broad band connec-tions – for mobile equipment (availability ofmobile Internet), inadequate evaluation ofthe importance of ICT industry for the coun-try’s economy, limited use of ICT potential inservices provided by the public administra-tion sector, limited number of highly skilledhuman resources, globalisation and itsNew Technology – Transcription of Spontaneous SpeechPhonexiaandOptimSys,incollaborationwiththeBrnoUniversityofTechnology,introducedinJune2010 anewtechnol-ogyonthemarket.ThistechnologyfromtheareaofspontaneousphonespeechtranscriptionintotextisabsolutelyuniqueintheCzechRepublic.Phonexiasuppliestechnologiesfortheautomatedgatheringofinformationfromspokenspeechanditsproductshavefounduseinapplicationsforphonecallanalysisincallcentres,intheareaofsecurityanddefence,andinmultimediaarchives.OptimSysintegratestelephonyintoenterpriseprocessesandITsystems.Thesystemiscapableofprocessinglowqualitysignalrecordings,ambientnoises,orincorrectpronunciation,whichhasnotbeenpossiblewithanyothersoftwarefortheCzechlanguage.minimum of ambient noise duringrecording, careful articulation, etc. The tran-scription of low-quality phone call recordingsinto text with their help yields only mediocreresults. In contrast, the technology devel-oped by Phonexia achieves an 85% successrate, which is fully sufficient for understand-ing the content while reading the text, andallows for further processing, such as index-ing and searching, creating speech records,phone call content checking, etc.The successrate of the system can be further improvedby adding words into its vocabulary. Thebasic version contains over 1 million words.In addition, OptimSys technologies allowfor the implementation of these advancedfunctions in company information systems,without the need to buy new telephones ortelephone switchboards.SYSTEM APPLICATIONCompanies may utilise the system, for exam-ple, to keep records of external and internalconferences, teleconferences, etc.The systemcan be used to visually parse the speech, inorder to quickly gain an idea about the direc-tion or development of a business meeting,or to search within the speech. A new func-tion allows users to dictate notes by callinga phone number. The resulting audio record-ing and the transcription will then be avail-able in the CRM system for further process-ing. The system can also detect monitoredwords, such as the name of the competitorsor vulgarisms used by both the client and theoperator.“The BUT Speech@FIT research group atthe Faculty of Information Technology at theBUThasalreadybeensuccessfulseveraltimeswith its speech recognition technologies ona worldwide level,” says Jan Černocký, Headof the Department of Computer Graphicsand Multimedia.“With the help of some addi-tional development, Phonexia transfers newtechnologies and the results of our researchinto practice. This co-operation provides uswith valuable feedback which we can reactto by further applied research.”“A new trend of information mining fromspeech is starting to take hold worldwide inthe area of customer services, especially fromphone calls, the so-called speech analytics,”comments Pavel Cenek, the Executive Man-ager of OptimSys. “Related technologies, incombination with open standards for the cre-ation of telephony and speech applications,form a whole new generation of telephonysystems with unique features. However, oldergeneration systems, not capable of the newlyoffered functions, are used almost exclusivelyin the Czech Republic today. Our companyis the only Czech producer of a platform fortelephony and speech applications based onthe aforementioned open standards.”Practical application of the technologiescan be tried out free of charge atwww.PrepisReci.cz.HIGH SUCCESS RATEOF TRANSCRIPTIONExisting commercially deployed speech tran-scription systems have been mainly devel-oped as dictation systems, limited to a specif-ic field, requiring quality sound, microphone,threats for ICT in the CR (especially the highadded value services drain from the CR).At the same time, ICT Union has formulat-ed potential solutions of many of the prob-lems, i.e. how to surmount the barriers. Theonly “little” thing that remains to be donenow is putting the strategy to life!!!In conclusion it can be said that meeting thepriorities and aims set out by ICT Union helpsto raise the competitiveness of the Czech Re-public, and will continue doing so also in fu-ture, not only on the European scale!More about ICT Union at www.ictu.cz

| 1 8S E R V I C E SIT in the Czech Republic is Comparable to the Developed WorldIn recent years, the economy of theCzech Republic has profited fromthe positive trends of past years. Yet,at the end of 2008 and especiallyduring 2009, it could not avoid theproblems caused by the uncertaintyof the world system of finance andthe subsequent global economicrecession from which the Czecheconomy has not been spared.The share of costs expended for soft-ware and services, related to hardware main-tenance from the overall IT expenditures, isgenerally considered a reliable indicator ofthe maturity of a given IT market. Accordingto IDC reports, the market for IT services in theCR grew by 5.4% in 2008, in comparison tothe year before, despite the beginning reces-sion. According to preliminary estimates, thegrowth in 2009 slowed down to 1.3% but, inview of the overall economic decline, we canstill consider these numbers a success. Ac-cording to the same source, the main sourceof investments in IT services is, and will remain,the state administration with its many e-gov-ernment projects. A further decline in expen-ditures for IT services is not predicted for 2010.Rather, they will be directed at different typesof projects than before the crisis.The performance of the domestic Informa-tionTechnologies industry should be boostedby direct foreign investments that have beenflowing into this field in recent years. Sun Mi-crosystems became the Investor of the Year2005 with the greatest economic contributiontothesectorofstrategicservicesbecauseofaninvestment in its Prague development centre.The following year, IBM was given this awardin the area of strategic services, after openingits centre for the outsourcing of InformationTechnologies in Brno in April 2006.In June 2006, Hewlett-Packard opened itsregional headquarters for Europe, Middle-East,and Africa for the management of produc-tion and distribution of personal computersand printing and image processing products.Honeywell founded a global centre for thesame area, for the support of its aviation pro-duction in Prague, which made it two devel-opment centres for the company in Prague.At the end of 2006, Google, one of the largestcompanies doing business on the Internet,also opened its branch in Prague.Mobile Technologies Support Center, builtby the software giant, Microsoft, became op-erational in January 2007. Microsoft, in co-op-eration with the South Moravian InnovationCentre (JIC), then opened the Microsoft Inno-vation Center in Brno the following year, tosupport start-up companies, especially fromthe area of IT. Microsoft opened another suchcentre in Hradec Králové at the beginning of2010. A new service centre was opened bythe Computer Sciences Corporation in 2007,providing a broad range of services in thearea of Informatics Technologies.AnotherAmericancompany–RedHat–oneof the world‘s leading suppliers of softwarebased on open source code, opened a newdevelopment centre in Brno in 2007. With207 professionals, this centre ranks among thecompany‘s most important branches.ICT investments are not limited to foreigncompanies, which is clearly illustrated by thefact that a genuinely Czech company (Logos)was named the most important Investor of theYear 2007 in the area of strategic services for anexpansion of its Prague IT development centre.The list is concluded by Novell, which openeda global Suse Linux support centre in Prague in2008, and eBay, which established a marketingand analytical centre in Prague to support itsbusiness activities in Europe and Asia. Otherinvestment projects have been realised by theHSBC bank, which opened a software and ap-plication development centre within its exist-ing centre of shared services in Ostrava, andSolarwinds Software Europe Limited with itssoftware development centre in Brno.The aforementioned information makes itclear that the Czech Republic has becomean important centre for the provision ofhigh-value added services in recent years.A Gartner Group study on the countries idealfor offshore IT services names the Czech Re-public in the regions of Europe, the MiddleEast, and Africa as being in first place aheadof Hungary, Ireland, and Israel.POSITION OFTHE ICT SECTORThere were 31 000 economic entities oper-ating in the ICT sector in the Czech Republicin 2008, 80% (25 000) of which were activein fields falling within the IT services. How-ever, the majority of them (over three quar-ters – 19 000) were individual businessmen– self-employed people.150 000 people were employed in the ICTsector in the Czech Republic in 2008 andtheir contribution to the overall employ-ment in the Czech Republic reached 2.8%.Almost half of all people working in the ICTsector in 2008 were employed in IT services.ICT MARKETIn recent years, the Czech market of the In-formation and Communication Technologies(ICT) has copied the economic developmentof the Czech Republic by recording a tumul-tuous growth. While it is difficult to estimatethe overall impact of the global economic cri-sis in the field of the ICT in the Czech Republicat this time, it is evident, on the basis of pre-liminary data from the international analyticalcompany, IDC, that the whole ICT market re-corded a year-on-year decline of 4.9% to CZK91.4 billion (approx. EUR 3.66 billion).Photo:www.sxc.hu

1 9 |C Z E C H B U S I N E S S A N D T R A D ESUCCESS OF CZECH ICTCOMPANIES ABROADThere are many Czech ICT companies thathave made a breakthrough abroad. Manysuccessful companies, such as LANGMasterInternational, CN Resources International,2N telecommunication, and many othersabroad have proved the quality of Czech ITprofessionals.The success of Czech companies from thefield of InformationTechnologies was spear-headed by Software 602 at the beginningof the ‘90s. The fame of the “ageless” T602text editor is now emulated by other Czechcompanies.AVG Technologies CZ (formerly Grisoft)from Brno has seen a great amount of in-ternational success. It is one of the largestexporters of anti-virus software (65% of thecompany was acquired by Intel Capital andEnterprise for EUR 43.23 million in 2005).Prague‘s OKsystem expands the not-so-numerousranksofsuccessfulCzechsolutionproviders for European research projects.The company has been developing a solu-tion for EU identification cards during thethree-year Onom@topic+ project (Europe-an Smart Card Platform for Citizenship andMobile Multimedia Applications). A consor-tium of 17 organisations from 7 countriesco-operated on this project. The result isa draft of a chip card operating system anda draft and an implementation of middle-ware. OKsystem should also be participatingin the subsequent BioP@ss project that willmainly make use of biometric methods.The example of Bohemia Interactive Stu-dio shows there is still room for innovativesolutions. Based on the world-famous game,Operation Flashpoint, and its newer engine,the Australian branch of the company, Bo-hemia Interactive Australia, has created theVirtual Battlespace Systems 1, a tactical sim-ulator for the military in the USA, the UnitedKingdom, Australia, and other countries. Itis a three-dimensional training system forteaching tactics to small units. A new gen-eration of this military training game, devel-oped according to NATO requirements forthe preparation of soldiers for Afghanistanand Iraq missions, is already being realisedin Prague. Czech companies have also seenmuch success in the field of games for mo-bile phones, as evidenced by the multi-player logical game, Multiplayer Reversi,developed by the Czech company Geewa.In June 2008, it became the most popularapplication for the iPhone smartphone byApple, Inc.E-GOVERNMENTIN THE CZECH REPUBLICThe Government of the Czech Republicpays a lot of attention to making the publicadministration services provided to compa-nies and citizens more effective, by modi-fying processes with the help of availableInformation and Communication Technolo-gies. In 2008, the Government approveda document called “Strategy for the Devel-opment of Services for the Information Soci-ety in the Czech Republic for 2008–2012”. Itsmain purpose was to allow citizens and thebusiness public to conveniently, securely,and reliably communicate with the publicadministration at all levels and regarding asmany life situations as possible.Thisstrategyisbeingimplementedthrougha series of mutually interconnected projects;the projects are divided into five programmeareas. Businessmen will find Area 2 usefulbecause it includes, among other things,the introduction of universal contact points(Czech POINT), allowing citizens to performa number of actions in one place, includingthe acquisition of statements from: the Driv-ers‘ Point Register, the Criminal Records, theReal Estate Register, and the Trade Register. Itis also possible to submit a form to theTradesLicensing Office.LOW RATE OFSOFTWARE PIRACYAccording to the results of BSA (BusinessSoftware Alliance) statistics, the rate ofsoftware piracy in the Czech Republic was37% in 2009, which was two percentagepoints less than the year before. The CzechRepublic has managed to lower the rate ofpiracy from the original 66% in 1994 by 29percentage points. These numbers put theCzech Republic in the 13th place worldwidewhen measuring the percentage of illegalsoftware.IT IN THE CZECH REPUBLICIS COMPARABLE TO THEDEVELOPED WORLDIn conclusion, it can be said that the CzechRepublic represents a highly competitivemarket in the area of ICT, with discriminat-ing customers and competent local busi-ness entities, whose business culture iscomparable to similar entities in the EU orOECD countries.Miloslav MarčanCIO, Ministry of Industry and Tradewww.mpo.czwww.businessinfo.cz

| 2 0S E R V I C E SThe Czech Security Branch Organi-sations Club is one of the oldest profes-sional organisations in the field of com-mercial security in the Czech Republic.It was founded in 1993 and its membersinclude companies providing protectionof property and people, private investiga-tors, and companies providing technicalprotection of property and people. Themembership base of the Club is currentlyformed by 36 firms. The Club is a trades-men‘s association of the Czech Chamberof Commerce. It serves as the spokesper-son of the Czech Chamber of Commercefor the field of property and peopleprotection.We asked the president of the Czech Se-curity Branch Organisations Club, VladimírRambousek, what developments he seeson the Czech market and what we can ex-pect in the future.Mr Rambousek, what is it the Czech Secu-rity Branch Organisations Club does?Our main goal is to improve the social pres-tige and standing of firms operating in thefield of property and people protection. Wealso contribute to the creation of a positiveimage of the field in the eyes of the public,and cooperate on the creation of suitablelegislative, economic, and social conditionsfor the performance of property and peopleThe Goal Is to Keep the Customer SatisfiedWe asked Mr Joshua Mensch, theMarketing Director of Data3s, a CRMcompany dedicated to the devel-opment of high-quality solutionspowered by Microsoft technologies.Your firm offers CRM systems. Canyou briefly introduce this term – whatdoes CRM stand for and how long has itbeen in the market?CRM stands for Customer RelationshipManagement and refers to a company‘sentire strategy for interacting with cus-tomers, clients, and sales prospects. Asa strategy, CRM includes all the basic prin-ciples of good sales, such as knowing yourcustomer, understanding their needs andmotivation, etc. As a set of practices, CRMis as old as business itself. It includes all ofthe channels a company uses to commu-nicate with clients as well as the methodsof assessing and responding to customerneeds. As a technology solution, howev-er, CRM systems have only been aroundfor about 20 years.How does a CRM system supportcustomers?A CRM system supports customers by im-proving customer service, which in turnimproves customers loyalty and reten-tion. The goal is to keep the customersatisfied so that you can continuouslyimprove and grow the business rela-tionship. But because each customer isdifferent, you need a system that is so-phisticated enough to respond to eachcustomer differently, while maintainingcomparable data across all customer seg-ments. A CRM system allows companiesto quantify all the unique and standardcharacteristics of a client and the clientrelationship so that both the selling andcustomer service models are appropriateto the context.What do you consider to be your com-pany‘s biggest success lately?To have seen strong growth in our cus-tomer base during the crisis period. Thelast quarter of 2009 was probably our bestperiod so far, and this year has seen a lot ofnew customers switch to eluzzion CRM aswell. We‘ve attracted major global brandslike Apotex and Novartis as well GedeonRichter, Glenmark, and Stada. Our clientschoose eluzzion CRM because they real-ize first, it is an incredible product, andsecond, Data3s is a company that is trulydedicated to their success. We see ourcustomers as real partners – and that‘s notjust a marketing slogan. In many cases,we have been fortunate to have potentialcustomers approach us first based on therecommendations of their colleagues inother companies. When one client refersyou to another, I think that is your great-est success.More information at www.data3s.comPhoto:www.sxc.hu,Data3sarchivesKeeping One‘s Firm Safe…

2 1 |C Z E C H B U S I N E S S A N D T R A D Eprotection. We perform competence exam-inations of security employees.How developed is the Czech market in thisarea?6 500 entities (self-employed persons andlegal entities) operate on the private secu-rity services market, which includes prop-erty and people protection, investigativeservices, and technical security services. Theoverall annual amount of provided servicesis estimated to be CZK 20 billion (i.e. approx.EUR 755 mil.) Security services are also animportant employer in the Czech Republic,with over 50 000 employees working in thefield.Is there any difference between thesituation in the Czech environment andabroad in this field?Private security services are an indispensa-ble part of the economy. This is true domes-tically, as well as abroad. The effects of theeconomic crisis are also seen in the businessof private security services, the Czech mar-ket is definitely not different in this regard.Economy measures in many companiescause a decline in their purchasing of secu-rity guard services and pressure on price re-duction. The decline in revenues from theseservices causes severe existential problemsfor some security firms. On the other hand,the positive consequences of the crisis arealso seen. Inflexible companies leave themarket, new technologies are adoptedfaster. The main reason for the deploymentof new technologies is to lower human re-sources costs.What are the new trends in securityequipment and the security industry?There is a worldwide trend, and the devel-opment in the Czech environment is thesame, which sees physical security guards ofoutside areas replaced by motion detectorcamera systems. This enables faster linkingof security services with other services.Are there any legislative news or regula-tions which need to be paid attention toin this area in the Czech Republic?The amendment of the Trades LicensingAct valid from 1 January 2009 has broughta major change for businessmen in the fieldof private security services. The amendmentintroduces obligatory examinations of pro-fessional competency for security employ-ees. Every employee in active service willhave to pass an examination of professionalcompetence from 1 January 2012. The ex-amination will be carried out by a three-member committee under the supervisionof an authorised person. Successful candi-dates will receive a certificate of professionalcompetence valid for 10 years.Are there any recent interesting develop-ments in the field? Something that caughtyour attention?The realisation of the public contract calledSector Council II is just starting. It is a jointproject of the Czech Chamber of Com-merce, the Confederation of Industry of theCzech Republic, and the consulting com-pany Trexima. The aim of the project in thearea of private security services is to prepareprofessional standards for individual “skills”.We expect the output to include the de-scription of activities of security employeestransporting money, members of tacticalunits used by panels of centralised protec-tion, and organisers at sport events.What do you think will influence this mar-ket in the future?The Czech Security Branch OrganisationsClub actively collaborates with other associ-ations of the Czech Chamber of Commerceon the preparation of a new legislature. Thenew Act on Private Security Services shouldbring a major change to the business of pri-vate security services. These services shouldbe excluded from the Trades Licensing Actand regulated by an independent law. Thischange will bring greater authority to secu-rity service employees, along with greaterdemands on the professional standard ofthe employees doing this work. And conse-quently, better services for customers anda higher social prestige for the field.

| 2 2Y O U N G S T A RScientists from Brno Discover Bambusuril,a Compound with Unique QualitiesScientistsfromMasarykUniversityinBrnohavediscoveredanentirelynewcompoundwithbroadapplicationpoten-tialinhealthcareandthepharmaceuticalandfoodprocessingindustries.Thescien-tistsareabletopreparelargequantitiesofthecompoundwhichhasnotexistedinnatureuntilnow.MasarykUniversityhasappliedforpatentprotectionofthecompound.WeaskedDr.VladimírŠindelář,theheadoftheresearchteamoftheDepartmentofChemistryoftheFacultyofScienceatMasarykUniversity,abouttheprojectdetails.hope that Bambusuril could be used toremove dirt from waste water or to prepareion exchangers.How would you describe the research?I formerly researched the qualities of an-other similar compound, called Cucurbituril.The trouble with Cucurbituril molecules wasthat they did not dissolve well and it was dif-ficult to modify their surface to make otheruses possible. Because of that, the strategyof our research team was to come up witha new compound that would significantlyimprove the listed qualities. This has reallybeen achieved with the creation of Bam-busuril. Masaryk University has submitteda patent application and the synthesis andcharacteristics of Bambusuril were subse-quently published in the prestigious sciencemagazine, Angewandte Chemie.Is it easy to prepare the compound? Whatis the origin of the Bambusuril name?Allsourcecompoundsanddissolutionagentsused during the preparation of Bambusurilare relatively easily available and cheap. Also,the clean substance separates from the solu-tion in the form of a precipitate during prepa-ration, which means no financially demand-ing separation methods need to be used forits isolation. The compound has the shape ofa short, hollow tube and is remarkably similarto one joint of a bamboo stalk.How long was the research and how muchdid it cost?The research took five years and was fi-nanced by the Grant Agency of the CzechRepublic and Masaryk University. The GrantAgency provided CZK 1.5 million (approx.EUR 60 000) and the University covered thecosts associated with employee wages.Did you co-operate with other similarforeign or domestic institutions duringthe research?The research took place exclusively at Ma-saryk University. Jan Švec, a student in theChemistry programme, contributed a greatdeal to the completion of the compound.Švec had started Bambusuril synthesis dur-ing his graduate studies and completed itafter several years, at the PhD level.Masaryk University had the compoundpatented. Is there a chance for the com-mercial application of Bambusuril? Inwhat fields?We have had Bambusuril at our disposal forabout a year now and we do not know all itsqualities yet. Only a detailed analysis of thecompound‘s characteristics will hint at otherpossible uses. We are now (June 2010) work-ing to prepare new derivatives of Bambusuril.Besides the proposed types of application,other entirely new possibilities may appear inthe future. We have submitted a patent ap-plication at the national level so far. It is be-ing considered whether Masaryk Universityshould apply for an international patent aswell. Such an application is much more costlyand the possible uses of the compound haveto be outlined more clearly before its sub-mission. Apart from our examination of thecharacteristics of Bambusuril, we are also try-ing to approach the business sphere, whosereaction could give us an idea about futureinterest in the compound, and its uses.Jana PikeYour team searched for a compound thatcould be “programmed” so that the com-pound itself could look for and eliminateharmful substances – in the human body,food, or drinking water. Have you suc-ceeded? Can you name some other pos-sible uses for the Bambusuril compound?The unique properties of Bambusuril lie inits capability to bind negatively chargedsubstances and function as their transport-er. This means Bambusuril is able to capturesome substances from a solution by stor-ing them within itself, as if in a container.The substance stored within it can thenbe transferred to another location, whereit is released. Thus, Bambusuril works likea transporter that loads a substance andtransports it from one location to another.Bambusuril has great future potential forthe health care and food processing indus-tries. Scientists can see Bambusuril used, forexample, to detect the presence of salt in thebodies of patients. A higher concentration ofsalt, or sodium chloride, in the human bodycan be a sign of some diseases, such as cysticfibrosis. Bambusuril could be used to preparesensors that would detect a higher con-centration of salt upon contact with a verysmall amount of human blood or urine, by,for example, a change in colour. The sensorswould use this method to quickly and accu-rately inform the doctor whether there areany symptoms in the patient. A similar meth-od could be used to determine the qualityof food or even to clean water. There is alsoJan Švec and Vladimír Šindelář from the Department ofChemistry of the Faculty of Science at Masaryk University.

2 3 |K A L E I D O S C O P EIndustry Is ContinuingIts Revival and Helpsto Boost ExportsIn April 2010 industrial production in theCR rose by 10.9% year-on-year and therevival in the industry sector is continu-ing. This has a favourable effect on thecountry’s balance of trade, which in thatmonth showed a surplus of CZK 15.4 bil-lion. Export trade owes its improvementprimarily to cars, electrical equipmentand devices, and machines and equip-ment used in industry. Czech importsrose by 12.9% year-on-year. Among otherfactors, the increase reflects the highercommodity prices.Fitch Raises Czech Rating from Stable to Positivefinance reform, in particular the reformof the pension and health care systems,could lead to an even higher rating, Fitchsays. The rating of long-term Czech for-eign exchange liabilities is on the levelA+ with a positive outlook. The rating ofdomestic currency liabilities remains onthe AA- level.Financial EvaluationMotivates Employeesonly TemporarilyFinancial evaluation always ranks first in theCzech Republic, according to a survey carriedout by LMC, operator of the labour portalsjobs.cz and prace.cz, and the Factum InvenioAgency. For most job seekers (47%) the deci-sivefactorinchoosingtheirlatestemploymenthas been payment conditions. The next crite-rion was the labour content (20%), followedby the long-term perspective of employment(8%) and the working hours (7%). Criteria suchas career prospects and long-term develop-ment or the firm’s reputation, were importantfor a mere 2% of the respondents. Other ad-vantages, or the atmosphere in the firm, weredecisive for just 4% of job-seekers in choosingtheir positions. The fact that money and gen-erous benefits are not sufficient for the long-termmotivationofemployeesisconfirmedbyDagmarŠimonová,HumanRelationsManagerof LMC, who says:“Senior employees, who al-readyhavesomeexperience,ata certainstageof their life opt for work with an employer whowill offer them the possibility of participatingin interesting projects. Their motivation is theopportunity to work for an employer whowill offer them a share of responsibility andthe possibility to influence important projectswhich the firm realises.”On the other hand, themost demotivating for employees is the non-observance of agreements on the part of theemployer, excessively authoritative manage-ment, zero pay growth, impossibility of profes-sional and career development, and non-par-ticipation in teamwork.At the beginning of June, the Fitch Rat-ings Agency confirmed its rating for theCzech Republic to be A+, and improvedits outlook, raising it from stable to posi-tive. The Agency thus reflected the ex-pected faster budget deficit reductionadvocated by the new government.A successful introduction of the stateDo Czech Firms AlreadyFeel the Signs of Economic Revival?According to a TACOMA survey, demandfor the products of Czech companies hasbeen rising moderately since the begin-ning of the year; in 2010, revenues are ex-pected to be higher, but there will proba-bly be no investment in new projects andno new work opportunities.The survey hasrevealed that 62% of respondents (a sam-ple of 130 important Czech companies)have already witnessed signs of revival.Their answers, however, confirmed thatin most cases the revival manifests itselfby a very moderate growth of demand, orrather by the halting of last year’s fall indemand. Ten per cent of the respondentssaid that now the situation was ratherworse than in the previous period. An-other ten per cent of respondents pointedout that the recession had no impact ontheir business and so the current situationwas the same for them as last year.Photo:MasarykUniversityarchives,www.sxc.hu

| 2 4LiberecPrahaČeskéBudějoviceJihlavaBrno ZlínOstravaOlomoucPardubiceHradec KrálovéÚstí n/LKarlovy VaryPlzeňThe Moravia-Silesia Region hasranked among the most impor-tant industrial regions in CentralEurope for 200 years. It is situatedin the north-east of the CzechRepublic; its northern neighbouris Poland and its eastern one isSlovakia.SLOVAKIAPOLANDBruntálNový JičínKarvináMoravia-Silesia RegionOstravaFrýdek-MístekNUTSArea(in sq. km)PopulationNumber ofmunicipalitiesPopulationdensity(persons/sq.km)LAU 1 – Bruntál 1 536 97 633 67 64LAU 1 – Frýdek-Místek 1 208 211 482 72 175LAU 1 – Karviná 356 273 137 17 772LAU 1 – Nový Jičín 882 152 563 53 173LAU 1 – Opava 1 113 177 133 77 159LAU 1 – Ostrava - město (city) 331 335 425 13 1 016NUTS 3 – Moravia-Silesia Region 5 426 1 247 373 299 230NUTS 1 – Czech Republic 78 867 10 506 813 6 249 133Source: Czech Statistical Office (as of 30 September 2009), NUTS – territorial unit according to EU classification, LAU 1 = districtLatest Data: Moravia-Silesia RegionPopulation As of 31 Dec. 2009 1 247 373Gross wages 1st quarter 2010 CZK 20 690 (EUR 828)Unemployment As of 31 May 2010 11.61 %AUSTRIAOpavaGERMANYR E G I O NThis is the most populated region of theCzech Republic – it contains very denselypopulated towns and districts, and otherareas with virtually no inhabitants. The majorpart of the Region has an industrial charac-ter and its main wealth lies in the deposits ofquality black coal, which reach as far as theBeskydy foothills.The power and metallurgical industrieshave the largest share, although these sec-tors are being restructured and are reducingproduction.The Region has the most burdened envi-ronment in the Czech Republic. Althoughthe quality of air has been greatly improved,it is still very polluted, especially in the areaof the black coal basins. On the contrary, theBeskydy and Jeseníky Mountains are sparselypopulated, making them popular touristdestinations. The centre of the Region is Os-trava. The structure of sectors in the Moravia-Silesia Region is causing serious problems,connected mainly with a higher rate ofunemployment.REGIONAL CAPITAL, OSTRAVAOstrava is the largest city in the Region, thethird largest city in the Czech Republic withthe third largest number of inhabitants. It hasan advantageous strategic position, near theSlovakian and Polish frontiers, on the banksof the Ostravice River, offering a view of thewonderful Beskydy range. The turning pointin the history of the city was the discovery ofcoal deposits in the second half of the 18thcentury, which was later followed by the de-velopment of ironworks. Ostrava lost the faceof a typically industrial city long ago, coalmining having definitively ceased in 1994.Extensive investment in environmentalimprovement was a boon to the air in Os-trava. Increased emphasis is being placedon engineering and other sectors. The cityis becoming the point of departure for thetourist region of the Jeseníky and BeskydyMountains. In addition to a hundred hectaresof reclaimed land, the city has a number oforiginal natural localities, many of which aremaintained as protected areas.DISTRICTSBruntál DistrictThe surroundings of the town of Bruntál usedto be a mining area, which was prosperousdue to precious metal extraction. The mostimportant sectors at present are the manu-facture of plastic materials, lighting fixtures,DISTANCES BETWEENOSTRAVA AND EUROPEANCITIES:Bratislava 295 kmVienna 370 kmPrague 380 kmWarsaw 400 kmBudapest 495 kmBerlin 530 kmBrussels 1 275 kmParis 1 410 kmRome 1 480 km

2 5 |C Z E C H B U S I N E S S A N D T R A D Ewires and spools, but the pharmaceuticaland food industries are also doing well. Ingeneral, the District has the character of anindustrial and farming area, employmentis concentrated in engineering, textile, andwoodworking enterprises.Frýdek-Místek DistrictThe Frýdek-Místek District is situated in theeasternmost part of the Czech Republic. Itscentre, Frýdek-Místek town, which is spreadout on both banks of the Ostravice River,originated in 1943 through the integrationof the Silesian town of Frýdek with MoravianMístek. The economic potential of the Dis-trict and the present structure have beenstrongly influenced by the long historicaldevelopment. The District always had anagricultural-industrial character with a pre-valent share of industry. The economic coreof the District was metallurgy plus mining.Investment has now been focused on theconstruction of a new infrastructure, prepa-ration of industrial zones, environmentalprotection, and the building of petrol sta-tions, hypermarkets and supermarkets.Karviná DistrictThe eastern and northern boundaries ofthe Karviná District are the Polish frontiers.The construction of mines and the follow-up coking, iron, metallurgical, and chemicalindustries, and the transport infrastructurecommenced in the 19th century. But a rapidreduction in heavy industry started in the1990s, as it did in other areas of the Region.Economically ineffective mining in the Dis-trict was terminated. The impetus for invest-ment happened gradually with the construc-tion of large industrial zones for businessesof greater extent – “Nové pole” in Karviná,“Pod zelenou”in Český Těšín, and support forbusinesses in other towns and villages. Statesubsidies went towards these purposes.Nový Jičín DistrictNový Jičín is an industrial and farming dis-trict. Industrial production is concentratedin the towns. The ownership share of for-eign companies is on the rise in many en-terprises of the Region. The District has richreserves of raw materials for the manufac-ture of building materials (such as lime-stone, gravel sand, brick earth, and buildingstone). The environment has been notice-ably improved since the early 1990s, dueto the reduction of industrial production,the use of more environmentally friendlytechnologies, and massive investment inecological measures. This improvement wasalso influenced by a change to heating withenergy sources that are a lesser burden tothe environment.Opava DistrictIndustry in this District is traditionallymore diversified than industry in thePOINTS OF INTERESTThe town of Kopřivnice, renowned forthe manufacture of Tatra automobiles(founded in 1850). The first automobilein Central Europe was manufacturedhere (Präsident, 1897).Sigmund Freud, famous Viennesephysician and psychiatrist, founder ofPsychoanalysis, was a native of Příbor.The house where Freud was born hasbeen ceremoniously opened; itemson display include the famous sofa,on which he examined his patients inLondon.Leoš Janáček, world-renowned classicalcomposer, was a native of Hukvaldy.Stodolní Street in Ostrava, which nevergoes to sleep: the largest concentrationof pubs and restaurants in the CzechRepublic is to be found in this street and itsimmediate vicinity (www.stodolni.cz).MORAVSKOSLEZSKÝ KRAJ(MORAVIA-SILESIA REGION)KRAJSKÝ ÚŘAD(REGIONAL OFFICE)28. října 117, 702 18 OstravaCzech RepublicPhone: +420 595 622 222e-mail: posta@kr-moravskoslezsky.czwww.kr-moravskoslezsky.czBRUNTÁLMĚSTSKÝ ÚŘAD BRUNTÁL(BRUNTÁL MUNICIPALITY)Nádražní 20, 792 01BruntálCzech RepublicPhone: +420 554 706 111e-mail: posta@mubruntal.czwww.mubruntal.czFRÝDEK-MÍSTEKMAGISTRÁT MĚSTA FRÝDEK-MÍSTEK(FRÝDEK-MÍSTEK CITY COUNCIL)Radniční 1148, 738 22 Frýdek-MístekCzech RepublicPhone: +420 558 609 111e-mail: podatelna@frydekmistek.czwww.frydekmistek.czKARVINÁMAGISTRÁT MĚSTA KARVINÁ(KARVINÁ CITY COUNCIL)Fryštátská 72/1, 733 24 Karvinápošta Karviná – FryštátCzech RepublicPhone: +420 596 387 111e-mail: podatelna@karvina.czwww.karvina.czNOVÝ JIČÍNMĚSTSKÝ ÚŘAD NOVÝ JIČÍN(NOVÝ JIČÍN MUNICIPALITY)Masarykovo náměstí 1, 741 01 Nový JičínCzech RepublicPhone: +420 556 768 222e-mail: posta@novyjicin-town.czwww.novy-jicin.czOPAVAMAGISTRÁT MĚSTA OPAVA(OPAVA CITY COUNCIL)Horní náměstí 69,746 26 OpavaCzech RepublicPhone: +420 553 756 111e-mail: info@opava-city.czwww.opava-city.czOSTRAVAMAGISTRÁT MĚSTA OSTRAVA(OSTRAVA CITY COUNCIL)Prokešovo náměstí 8,729 30 OstravaCzech RepublicPhone: +420 599 444 444e-mail: posta@ostrava.czwww.ostrava.czPhoto:CzechTourismOstrava - Masaryk Square at night

| 2 6R E G I O Ninvolved in the cross-border co-operationof Euroregions.The Moravia-Silesia Region Offers:trained labour for industry,very good knowledge of traditional indus-trial sectors (engineering, the steel, chemi-cal, and textile industries),scientific research centres and institutions(Information Technology, Biotechnology,progressive materials),four universities,industrial zones, science and technologyparks, business incubators,very dense infrastructure,advantageous situation between Polandand Slovakia,transit corridor – road intersection andrailway junction,branches of foreign banks,main international retail chains,international airport with the potential forexpansion,excellent cultural opportunities (opera,philharmonic orchestra, theatre, galleries),innumerable possibilities for leisure-timeactivities and sports,European standards of health care.Moravia-Silesia Region in general. Forthis reason, it had better prerequisitesfor adaptation to market conditions afterthe 1989 turnabout. An important part ofthis process was the privatisation of Stateenterprises.ECONOMIC POTENTIALThe heavy industry is being gradually re-placed with light industry and services. Thedevelopment of business in the market en-vironment has changed its structure beyondrecognition. Many restructured enterpriseshave been purchased by foreign investors.Local companies did well in InformationTechnologies, electronics, electrical engi-neering, and the automobile industry. Thereare also many big and small enterpriseswhich operate in traditional crafts, as well asin hi-tech products.The Moravia-Silesia Region offers opportu-nities for a broad range of new investmentprojects and for the development of poten-tial and possibilities. Domestic and foreigninvestors can utilise the existing industrialcomplexes and new industrial zones.In view of the situation of the Moravia-Silesia Region, many towns and villages areTRANSPORTThe Moravia-Silesia Region has a total of3 376.4 km of roads. It has a strategic posi-tion along the borders of three countries:the Czech Republic, Poland, and Slovakia.Thanks to this advantageous position, theRegion is situated at the intersection oftwo transport corridors: West – East (Ger-many – the Ukraine) and North – South(Scandinavia – Italy).The Region has a very dense network ofrailway lines, with a total length of 677 km.All railway lines in the Moravia-Silesia Regionare operated by České dráhy, a.s. (Czech Rail-ways www.cd.cz). International rail transportis very important to the Region. An impor-tant role is played by freight transport. Dueto large industrial enterprises, the railwayscarry huge amounts of solid fuels, metal-lurgical and chemical products, and mineralraw materials.Mošnov International Airport (www.airport-ostrava.cz), 20 km from Ostrava, is an impor-tant point of entry to the industrial area ofNorthern Moravia and Silesia, the area withthe largest concentration of economic po-tential in the Czech Republic.Source: Albertina Company MonitorIMPORTANT COMPANIES IN THE DISTRICT ACCORDING TO TURNOVERName Based in Sector ContactAL Invest Břidličná, a.s. Břidličná aluminium production www.alinvest.czContinentalAutomotive SystemsFrenštát pod Radhoštěm manufacture of parts and accessories for motor vehicles and their engineswww.siemens.czwww.siemensvdo.czŽDB Group, a.s. Nový Bohumín letting of own propertywww.zdb.czwww.viadrus.czVisteon - Autopal, s.r.o. Nový Jičín manufacture of parts and accessories for motor vehicles and their engineswww.autopal.czwww.visteon.czAsus Czech, s.r.o. Ostrava – Hrabová manufacture of computers and other information processing equipmentwww.asus.czwww.asusteam.czEvraz Vítkovice Steel, a.s. Ostrava – Hulváky manufacture of basic iron and steel and of ferro-alloys www.vitkovicesteel.comIvax Pharmaceuticals, s.r.o. Opava – Komárov manufacture of basic pharmaceutical products www.ivax-cr.comArcelorMittal Ostrava a.s. Ostrava – Kunčice manufacture of basic iron and steel and of ferro-alloys www.mittalsteelostrava.comBorsodChem Mchz, s.r.o. Ostrava – Mariánské Hory manufacture of other organic basic chemicals www.bc-mchz.czeD´ system Czech, a.s. Ostrava – Mariánské Hory wholesale of computers, computer peripheral equipment and software www.edcz.czHruška, s.r.o. Ostrava – Martinov wholesale of fruit and vegetables www.hruska.infoOKD, a.s.Ostrava – MoravskáOstravamining and agglomeration of hard coal www.okd.czTCHAS, spol. s r. o. Ostrava – Poruba general construction of buildings and civil engineering works www.tchas.czOKD, OKK, a.s. Ostrava-Přívoz manufacture of coke oven productswww.okk.okd.czwww.okd.czVítkovice, a.s. Ostrava – Vítkovice distribution and trade of electricitywww.watrex.comwww.vitkovice.comFinitrading, a.s. Třinec – Lyžbice wholesale of metals and metal oresMoravia Steel, a.s. Třinec – Staré Město wholesale of metals and metal oreswww.trz.cz,www.moravia-steel.czTřinecké Železárny, a. s. Třinec – Staré Město manufacture of basic iron and steel and of ferro-alloys www.trz.cz

2 7 |C Z E C H B U S I N E S S A N D T R A D EEDUCATIONThe Region has a total of 472 nurseryschools, 459 elementary schools, 156 sec-ondary schools, 2 conservatoires, 11 highervocational schools, and 5 colleges and uni-versities. The network of pre-school andschool establishments and institutions of-fers extra-mural activities and education atall levels. University studies in Humanities,Economics, Natural Sciences, and techni-cal branches are very well developed in theMoravia-Silesia Region.Border areas of the Czech Republic,Poland, and Slovakia have a separatesubsidy programmeIn view of the geographic situation of theMoravia-Silesia Region on the borders ofPoland and Slovakia, its officials and theirPolish and Slovakian counterparts wanttheir own European Union subsidy pro-gramme to finance projects, for instance,in transport, tourism, and the powerindustry.Since 2007, the Moravia-Silesia Regionhas acquired approximately CZK 36 billion(EUR 1.45 billion) from the EU. It has agreedwith four partners on the establishmentof a European group for territorial co-op-eration. Closer co-operation has also beenagreed upon by officials of the Chambers ofCommerce of the border areas, who intendto concentrate, in addition to the transportinfrastructure, on the environment, educa-tion, science and research. The joint inter-ests of Czech-Polish co-operation are alsoasserted by the Euroregion Silesia, whichhas won a number of awards, including anHonorary Mention of the Association of Eu-ropean Border Regions, which it gained inNovember 2006 for extraordinary successin European cross-border co-operation. In2007, the Czech Foreign Ministry bestowedthe Jan Masaryk Silver Medal on the Czechand Polish sides of the Euroregion for theirlong-term active contribution to Czech-Polish cross-border co-operation (www.euroregion-silesia.cz/).Ostrava11 and 12 October 2010Clarion Congress Hotel Ostrava (formerly Atom Hotel)A particular attention will be paid to the cross-border cooperation within the CzechRepublic – Poland – Slovakia triangle, where economically powerful regions arelocated: Silesian and Opole Voivodeships, Žilina Region and Moravian-Silesian Region.Topicstobediscussedandpresentedattheconferencewillincludeeconomiccollaboration,investments,science,researchandinnovation,commercialactivities,andentrepreneurship.Information will be provided about new initiatives supported by the European Groupingof Territorial Cooperation, Jessica (a financial tool for the development of towns andcities), and projects co-financed by public and private funds (PPP).The goal of the Conference is to offer efficient collaboration and introduce importantand successful projects that might accelerate development of the entire economic Euro-region within the new cohesion policy pursued by the European Union.Conference will be held under the auspices of:Prime Minister Czech Republic, The Deputy Prime Minister and Minister of Foreign Affairs,MinisterofIndustryandTrade,TheMinisterofEducation,Youth,Sports,PresidentoftheMoravian-SilesianRegion, LordMayoroftheCityofOstrava,ChamberofCommerceoftheCzechRepublic.For further information and registration please visit www.ifo.cz11th Annual International ConferenceMain Partners:Organiser:Partners: Media Partners:SELECTED INSTITUTIONSPROMOTING BUSINESSIN THE MORAVIA-SILESIAREGION:Moravia-Silesia Solidarity RegionalCouncil, www.rr-moravskoslezsko.czEurocentrum Ostrava, www.euroskop.czRegional Development Agency,www.rdaova.czOstrava Science and Technology Park,www.vtpo.czMoravian-Silesian Regional Chamber ofCommerce, www.khkmsk.czBIC Ostrava, www.bicova.czCzechTrade, www.czechtrade.czCzech Statistical Office, www.czso.czCzech Property Market, www.eCPM.cz,(community server for professionals inreal estate, construction, development,and related branches)OTHER FOREIGN CO-OPERATIONAlthoughtheMoravia-SilesiaRegiondoesnotshare a frontier with Germany, it has been co-operating with North Rhine-Westphalia since2002. Co-operation with the Region NorthEast, Great Britain, has been slightly stagnat-ing. Present partners of the Region which arenot EU members, are in Russia (Vologda Re-gion) and Vietnam (Khanh-Hoa Province).

| 2 8R E G I O NMoravia-Silesia Region: Gate to Investment Opens WideThe steel heart of the Czech Repub-lic, as the region around Ostrava haslong been referred to, is no longerbeating for industry alone: the 1990ssaw large-scale restructuring ofindustry in North Moravia, which ledto the growth of the region’s busi-ness potential, and consequentlyits investment opportunities. Now,production and investment go handin hand in Ostrava and its environs.Since the 19th century, the Moravia-SilesiaRegion has been one of the Czech Republic’sregions with strongly developed industry. Atthe time of its greatest industrial boom, theRegion’s vast black coal deposits promptedthe development of mining and the follow-up steel production and engineering. Cur-rently, more than one-third of the labourforce in the Region is employed in industrycreating nearly one-half of its product.Besides the traditional branches, formingthe established“coal-steel-engineering”valuechain, the Region is known for the develop-ment of yet other branches. In recent years,the most massive investments went into theautomotive industry (with a unique invest-ment project by Korea’s Hyundai Motor Man-ufacturing Czech s.r.o. in Nošovice), IT andelectrical engineering (e.g. OSRAM Bruntálplace their investment projects in the Regionthe services of industrial parks (open spacesor surfaces already fitted with the requiredfacilities). The full comfort of a well-function-ing infrastructure with follow-up services andsuitable conditions prepared for the investors’specific needs is a matter of course.Evidence of the attractiveness of NorthMoravia is proved by the high occupancyrate of the industrial parks in the Region.The use and occupancy of the surfaces byinvestors is a closely watched criterion in as-sessing the attractiveness of those localities.The average occupancy rate of the industrialparks in the Region is around 74%.The two most successful industrial parksin the Region are the parks in Karviná-NovéPole and in Kopřivnice, where the largestnumber of investors have settled. Visually,too, both localities give the impression ofprospering industrial parks. In the 1990s,the Karviná locality was prepared as a pilotindustrial park project on the territory of to-day’s Region. After a slightly hesitant start,the locality took full advantage of its lead.The Krnov-Červený Dvůr locality also provedvery successful and after some time had tobe enlarged, just like Karviná. Also success-ful are the Bolatice-type projects, mainly oc-cupied by smaller companies.The Region demonstrated its skill andability to meet the investors’ requirementsby its prompt preparation in Nošovice ofa strategic industrial park for the world carmanufacturer, Hyundai Motor Manufactur-ing Czech (HMMC). The car factory startedtrial operation in November 2008, two yearsafter Hyundai’s appearance in the Czech Re-public, and launched serial production cer-emonially in April 2009.ONE-STOP SHOPFOR INVESTORSThe task of ensuring the complete servicefor investors coming to the Moravia-Si-lesia Region was assumed by the RegionalDevelopment Agency in Ostrava, whereit developed a unique project called One-Stop Shop. Through it, potential investorscan obtain the first information about theRegion and get the first impressions aboutthe Moravia-Silesia Region. Together withCzechInvest and other regional institutionsthe Agency guides potential investors frominitial presentations and the offer of in-dustrial property to seeking out would-bePhoto:CzechInvestarchivesspol. s r.o. and TietoEnator, a.s.), thechemical industry and specialised servicesfor different firms (especially engineering,consulting, and research firms). As regardsthe country of origin, most foreign investorscome to the Moravia-Silesia Region from theUSA, Germany, and South Korea.REGION IN THE FOCUSOF INVESTORSIn 2009, through the mediation of CzechIn-vest Agency, the Moravia-Silesia Region at-tracted new investments worth more thanone billion crowns. Altogether 26 projectswere placed in North Moravia in that year.As regards the number of new investments,the Moravia-Silesia Region ranks thirdamong the Czech Republic’s 14 regions,after Central Bohemia and South Moravia.“Most frequently, our assistance in 2009went to software development firms andtheir new projects. The Moravia-Silesia Re-gion decided to realise twelve such projects,eleven of them directly in Ostrava, andthe twelfth one in Orlová,” says AlexandraRudyšarová, acting Chief Executive Officerof CzechInvest. Three projects were pre-pared by engineering companies and twoeach by companies operating in the area ofelectronics and electrical engineering, andthe rubber and plastics industry.QUALITY GUARANTEEDBY INDUSTRIAL PARKThe Moravia-Silesia Region has been tryingto support the development of wide-rang-ing business and industrial activities since the1990s by offering entrepreneurs wishing toThe Orchard Ostrava Office Park

2 9 |C Z E C H B U S I N E S S A N D T R A D Esub-contractors and other suppliers for theconstruction and equipment of their plants,including outsourcing and aftercare.In this way, investors can obtain professionalservices from a single place, which cover allphases of the investment process. The fullrange of these services is available to the in-vestors free as added value provided by theMoravia-Silesia Region over and above currentinvestment incentives. As a part of aftercare,the Ostrava Regional Development Agencyis developing its KREDO database (www.arr.cz/kredo/index_en.php), which connectsinvestors with regional suppliers, thus build-ing a sub-contractor base. The Agency alsostimulates the regional offer of commercialproperty through its RealData network. Con-sulting services are provided by the RegionalEconomic Chamber of the Moravia-Silesia Re-gion, for example in the area of cross-borderco-operation of Czech and Polish firms.GENEROUS INVESTMENTINCENTIVESBoth Czech and foreign investors coming tothe Moravia-Silesia Region to do businessare entitled to apply for local and nationalinvestment incentives provided by theCzech Republic.As from 2 July 2007, investors starting newproduction projects or enlarging their exist-ing facilities in the area of the manufactur-ing industry worth more than EUR 2 millioncan obtain investment incentives under ActNo. 72/2000 Coll. on Investment Incentives,as amended.The main investment incentives offered bythe Region include, for example, corporateincome tax relief (with full income tax relieffor up to five years in the case of new compa-nies and partial income tax relief for up to fiveyear in the case of expanding companies).Material support is available for the creationof new jobs (EUR 2000 for the creation of onejob in regions most affected by unemploy-ment) and material support for training andre-qualification to the amount of from 25 to45% depending on the size of the firm.HIGH-QUALITY OFFICE SPACEBesides well-prepared industrial parks theRegion has a good supply of high-qualityoffice space. Although the office space mar-ket (especially new construction) has beenaffected by the economic crisis, good-qual-ity and above-standard office space is read-ily available. At the end of the first quarter of2010, Ostrava had 105 700 sq. m of modernoffice space available, of which 74% in classA. Completely new office complexes areTheOrchard (3rd phase) with an area of 11 000sq. m and Nordica Ostrava (11 900 sq. m).In the first half of 2009, 17 300 sq. m of newvacant office space was placed on the mar-ket, which resulted in a 29% vacancy rate. AsSUCCESSFUL INVESTMENT PROJECTS IN THE MORAVIA-SILESIA REGIONCzech legal person Sector Country of originInvestments(EUR million)Jobs Year LocalityBehr Ostrava s.r.o. automotive Germany 20.0 130 2006 MošnovCENTRAL EUROPE AIRCRAFT MAINTENANCE a.s. repair centre – aviation Czech Republic 42.0 176 2006 MošnovErdrich Umformtechnik s.r.o. metalworking Germany 30.3 61 2005 KrnovHyundai Motor Manufacturing Czech s.r.o. automotive South Korea 1 200 3 000 2006 NošoviceMölnlycke Health Care Klinipro s.r.o medical equipment Sweden 16.8 150 2001 KarvináOSRAM Bruntál spol. s r.o. electronic Germany 13.8 115 2004 BruntálSiemens Automobilové systémy s.r.o. automotive Germany 15.7 355 2004Frenštát podRadhoštěmTietoEnator, a.s. information technology Finland 1.1 330 2005 OstravaDEVELOPMENT OF OFFICESPACE MARKET IN OSTRAVA:2006 – 26 200 sq.m2007 – 37 800 sq.m2008 – 11 000 sq.m2009 – 22 948 sq.mVACANCY RATE ASOF THE END OF:2007 – 23.2%2008 – 16%2009 – 22%Q1 2010 – 21.9%COMPARISON OF THEHIGHEST RENTS CHARGEDIN CLASS A BUILDINGSPrague - 21.00 EUR//monthBrno - 13.50 EUR//monthOstrava - 12.50 EUR//monthSource: CB Richard Ellisno other office building was completed bythe end of the 1st quarter of 2010, the mar-ket has absorbed some of the vacant space,so that the vacancy rate dropped to approx.22%. According to a study carried out by CBRichard Ellis s.r.o., the highest rent chargedin Ostrava in March 2010 amounted toEUR 12.50/sq.m/month.Source: CzechInvestThe Hrabová Industrial Park is waiting for new investors.

| 3 0R E G I O NKeyword of the Future? Innovation!The Moravia-Silesia Region is alsoinvolved in the fashionable, but es-sential trend called Innovation. Thisis why regional politicians have pre-pared a totally new strategy focusedon support for innovation processesin business.Research and Development has a largeshare in the advancement of the Moravia-Si-lesia Region. This is mainly due to the high-quality scientific background at universitiesand research institutions, and the innovativeactivities of private companies operating inthe Region. An increasingly important fac-tor in the development of innovation in theRegion are institutions such as business in-cubators, clusters, and technology parks.The Moravia-Silesia Regional strategy ofinnovation in the 2010-2016 period is a newmilestone in its development, designed toincrease the competitiveness of the Regionon global markets.MORE THAN COAL-STEEL- ENGINEERINGRegarding sectors, strategy is based on tra-ditional ones with development potential,and on the use of their unique know-how,which is typical only of this Region withinthe“coal-steel-engineering”value chain.Besides this main specialisation, successis being attained in the research of progres-sive areas – such as the development ofnew materials, lighting equipment, ventila-tion and air-conditioning systems for theautomobile industry, information techno-logies such as software for consultancyand system integration, the developmentof special equipment for the power indus-try (often based on the use of waste), thedevelopment of special (measuring) appa-ratus and equipment for the metallurgical,mining, and engineering industries, andnew methods of specialised engineering,particularly in heavy engineering. Researchand Development is also being conductedin industrial automation, robotics, electron-ics, and the chemical industry.TRANSFER AND HUMANRESOURCESFrom the thematic point of view, the strat-egy is concentrated on four areas. The firstis the transfer of technologies to make moreeffective the existent systems of com-mercialisation of the results of science andresearch, to support the co-operation ofknowledge institutions (universities and re-search institutes) with businesses, to estab-lish and develop new spin-off and start-upcompanies, and to increase the intensityof the involvement of cluster organisationsin Research and Development projects, in-cluding international ones.In the second thematic area, the devel-opment of human resources, the strategyis to raise the professional competencesof human resources in the knowledge ofeconomy in the transfer of technology, pro-tection of intellectual property, and the re-gional innovation system as such. Supportfor increasing the qualifications of humanresources, as well as for attracting the bestforeign researchers to the Moravia-SilesiaRegion will be very important.INTERNATIONALISATION,CO-ORDINATION, IMPLEMENTATIONThe third area, internationalisation, will befocused on support for the establishment ofinternational contacts and know-how trans-fer, increased participation of the Regionin international projects of Research andDevelopment, and support for the exportperformance of companies in the Moravia-Silesia Region.The last area, the co-ordination and imple-mentation of the regional innovation strat-egy, will cover matters relating to the consoli-dation of the regional innovation system.In co-operation with the RegionalDevelopment Agency Ostravawww.arr.czPhoto:www.sxc.hu,www.brownfieldy.cz

3 1 |C Z E C H B U S I N E S S A N D T R A D ESELECTED BROWNFIELDS INTHE MORAVIA-SILESIA REGIONKARVINÁ INDUSTRIAL PARK(FORMER KOVONA)District: KarvináMunicipality: KarvináGPS coordinates: 49°51‘52.376“N18°32‘40.523“EType of locality: compound (surface withbuildings)Condition of locality: The locality is preparedfor regeneration. Partial reconstruction ispossible/reconstruction of separate parts ofthe compound.Current use: partly rented for businessactivities.Previous use of locality: industry, metallurgy.Surface of locality: 122 000.00 sq. m.WESTERN ZONE, BRUNTÁLDistrict: BruntálMunicipality: BruntálGPS coordinates: 49°59‘31.967“N17°26‘23.96“EType of locality: plot (surface withoutbuildings).Condition of locality: The locality is preparedfor regeneration. The regeneration of theentire locality is possible. Feasibility studyand building study are available.Current use: abandoned locality.Previous use of locality: military compound,barracks, shooting-ground. Military barracksbuilt in 1968, currently all surface parts ofthe compound have been removed.Surface of locality: 112 000.00 sq. m.ODRA COMPOUND – JAN ŠVERMA MINESERVICE DIVISION, OSTRAVADistrict: OstravaMunicipality: OstravaGPS coordinates: 49°48‘1.132“N18°11‘54.334“EType of locality: plot (surface without buildings)Condition of locality: The locality is notprepared for regeneration.Current use: nonePrevious use of locality: industrySurface of locality: 101 000.00 sq. m.A complete and updated review of brownfields in the Moravia-Silesia Region can be found at:http://www.brownfieldy.org/brownfields-list/Money from Jessica Fund for Brownfield–Bruntál RegenerationBrownfields in the Moravia-SilesiaRegion have become a very temptingattraction. The Region is the first touse EU money for their regeneration,specifically through the Jessica Fund,and the first in the Czech Republic,where European money can be usedfor the regeneration of post-indus-trial compounds.Jessica, the Joint European Support for Sustain-able Investment in City Areas Fund, is a jointinitiative of the European Commission, the Eu-ropean Investment Bank (EIB), and the Councilof Europe Development Bank (CEB). Its aim isto support sustainable investments, growthand employment in urban areas. The princi-pal idea is to ensure a more purposeful use ofmoney from European funds and with theirhelp to draw the private sector into investmentprojects. Besides money from European funds,theprojectsaretobefinancedbyEIBandcom-mercial banks, together with private investors.JESSICA WILL GRANTADVANTAGEOUS LOANSWhile ordinary operational programmesprovide support exclusively in the form ofnon-returnable subsidies, Jessica offers theregions the possibility of getting the moneyback and to use it again in the future to sup-port further investments. The instrument isdesigned exclusively for the developmentof towns and urban areas.The conditions under which Jessica willgrant the loans or guarantees will be moreadvantageous than is current practice onthe market, but on the other hand the in-vestment projects must fit into areas whichthe region plans to support through Jessica.Both private and public investors may applyfor financing from Jessica.20 MILLION EUROSIS AVAILABLEThe Jessica holding fund loan agreementwas signed in February 2010 by JaroslavPalas, President of the Moravia-Silesia Re-gion, and Matthias Kollatz-Ahnen, Vice-President of the European Investment Bank.Jessica is a“fund of funds”, which currentlydisposes of an amount of EUR 20 million.MONEY FOR BROWNFIELDOWNERSThe Region is planning to use the sup-port for the regeneration of unused in-dustrial structures. Originally, the EUR 20million was available from the Moravia-Si-lesia Regional Development Programmefor the support of such projects, but asRegional President Jaroslav Palas said, itattracted no interest under existing con-ditions. The Region therefore decided totransfer the money into a new financ-ing instrument. “The brownfields issue,which involves a number of ownershipproblems and other obstacles, can hardlybe supported under current subsidy con-ditions,” Palas says.Brownfields, one of the potential investment opportunities in Ostrava and its environs.

| 3 2R E G I O NClusters - Direct Way to SuppliersIn the Moravia-Silesia Region themost significant industrial sectorsare organised in clusters, which givesthe Region a new profile and signifi-cantly simplifies investors’access toindividual suppliers. The Region isthe leading one in the Czech Repub-lic in this respect.To support joint development of clusters,the Agency for Regional Development sup-ports the initiative called ClusterNet. Its taskis to create and coordinate network cooper-ation of the relevant persons who are activein the clusters. At the moment there are tenclusters in the Region.The Moravian-Silesian Wood Process-ing Cluster focuses on the support of thedevelopment of wood processing sector inthe Moravia-Silesia Region. It has the ambi-tion to become a significant supplier andexporter of timber structures and innova-tive components for timber structures andhouses (www.msdk.cz/).The Czech Machinery Cluster’s objectiveis to establish a highly prestigious and mod-ern engineering platform which would beprepared in human resources, technologies,and innovations for the formation of sup-ply chains in the field of strategic projectsfor energy industry, transport industry, andconstruction on a global scale (www.mssk-ova.cz/CZ/default.aspx).The IT Cluster focuses on preparinghuman resources, on joint marketing ac-tivities, and on establishing the potentialfor innovative projects in the field of IT(www.itcluster.cz).The Moravian-Silesian Automotive Clus-ter, whose goal is to develop the automo-tive industry in the region in order to achievepermanent competitiveness of regionalsuppliers for the automobile industry in theCzech Republic and abroad and create con-Moravian-Silesian Energy Cluster wasfounded in the north of Moravia as anassociation of firms in power engineer-ing. The Moravian-Silesian Energy Cluster(MSEK) was established by seven mem-bers. Among them are the energy groupDalkia Czech Republic, Regional EconomicChamber, and the Technical University ofOstrava. According to the president of thecluster and the head of the board of direc-tors of Dalkia Czech Republic Zdeněk Duba,the cluster would like to cooperate on theenergy conception of the state, to developresearch in power engineering and sup-port regional farmers in the production ofbio-fuel. One of the founding members ofthe cluster is also the VŠB – Technical Uni-versity of Ostrava. MSEK wants to influencethe legislation in the field of power engi-neering related to the prepared EU direc-tives (www.msek.cz/).Cluster of Safety and Technology fo-cuses on the coordination and strength-ening of cooperation in the field of tech-nological safety research concentratedin the Moravia-Silesia Region, which hasa very suitable infrastructure and historylinked to heavy industry and metallurgy.It also continues in the mission and activ-ity of the Czech Technological Platform onIndustry Safety, whose primary goal is toincrease industry safety.WHAT IS A CLUSTER?A cluster is an association of regionallyconnected companies and affiliatedinstitutions and organisations – especiallyinstitutions of tertiary education (universi-ties, colleges). Their association has thepotential to strengthen and increase theircompetitiveness.Photo:www.sxc.hu,VŠB–TechnicalUniversityofOstravaarchivesditions for increasing the abilities andfull utilisation of local workforce as well astechnical capacities (www.autoklastr.cz/).The HYDROGEN Cluster focuses primarilyon research and development activities inthe field of hydrogen technologies and onthe all-round development of specialists inthe field of production, storage, distribution,and usage of hydrogen (www.msunion.cz/klastry/klastr-hydrogen-cz--o-s-).The ENVICRACK Cluster’s activity is close-ly connected to the science and researchactivities in the field of renewable and alter-native energy sources. The cluster is aimedat utilising waste as the potential source forpyrolysis technologies producing electricityand thermal energy (www.envicrack.cz/)Knowledge Management Cluster isaimed at the development of informationand communication technologies and busi-ness knowledge transfer, especially in smallcompanies in the Moravia-Silesia and ZlínRegions (www.kmcluster.cz/).Tourism Cluster (KLACR) has set as itsobjective to establish a competitive touristregion, to coordinate activities in tourism,to communicate with the public sector, tocooperate with entities in tourism and sup-port innovation at the same time. By provid-ing successful cooperation of entities andcompanies active in tourism, KLACR wantsto make the Moravia-Silesia Region a prestig-ious local and incoming destination provid-ing high-quality services and increasing theoutput of all players (www.klacr.cz).

3 3 |C Z E C H B U S I N E S S A N D T R A D EOstrava and its Neighbourhood: Location of Three Top UniversitiesEducation is the key investmentinto the society of the future. TheMoravia-Silesia Region is not laggingbehind in paying attention to it asit has a dense network of universityeducation opportunities – in bothpublic and private institutions. Withregard to the industrial history ofthe Region the university educationis also aimed mainly at technical sec-tors of education.Republic, whose scientific and research anddevelopment potential develops and repre-sents a significant part of innovation activitiesin the Moravia-Silesia Region and the CzechRepublic. At the moment,VŠB-TUO with its ap-prox. 22 thousand students is the fourth larg-est university and the second largest technicaluniversity in the Czech Republic. Research anddevelopmentactivitiesarecarriedoutatsevenfaculties. The Faculty of Electrical Engineeringand Computer Science and the Faculty ofMetallurgy and Materials Engineering providethelargestspaceforthisactivity.TheUniversityalso consists of science and technology cen-tres: Centre forTechnologyTransfer, Nanotech-nology Centre, Environmental TechnologiesCentre, Energy Research Centre, Super Com-puter Centre, Institute of Modelling and Con-trol of Forming Processes. (www.vsb.cz)UNIVERSITY OF OSTRAVAThe University of Ostrava undertakes researchanddevelopmentatsixfaculties:FacultyofArts,Pedagogical Faculty, Faculty of Science, Facultyof Social Studies, Faculty of Health Studies, andpartially also at the Faculty of Fine Arts.The Uni-versity also comprises two university researchcentres. The Institute for Research and Appli-cation of Fuzzy Modelling is a top Europeaninstitution, which focuses on the developmentof special mathematical methods and theirapplication. The European Research Institutefor Social Work focuses on the developmentof research activities in the field of social workin cooperation with six European universities.There are approx. 10 thousand students at theUniversityofOstravain350studyfieldsinBach-elor, Master, and Doctoral study programmes.University staff participate in dozens of jointresearch projects with other Czech and for-eign universities. Hundreds of students fromthis university complete study programmes atpartnership universities abroad and hundredsof students come to study at the University ofOstrava from abroad. (www.osu.cz)SILESIAN UNIVERSITY IN OPAVAThe fact that research and developmentactivities are cultivated at the Silesian Uni-versity in Opava and Karviná is testified bythe publication activity and scientific confer-ences, which the Silesian University in Opavaorganises also at international level. The Uni-versity has excellent results with internationalresponse in the field of multi-agent systemsand experiments and application of multi-agent systems on robotic platforms. TheMathematical Institute in Opava, founded on1 January 1999 and a part of the Silesian Uni-versity, has a significant position in the field ofresearch and development.The current mainresearch focus of the Mathematic Institutewith a total budget of CZK 63 million (approx.EUR 2.5 million) is in topological and analyticmethods in the theory of dynamical systemsand mathematical physics. (www.slu.cz)BUSINESS SCHOOLIN OSTRAVA, A.S.The Business School in Ostrava, a.s. (Plc) hasbecome the natural centre for education inthesectorofmanagementandbusiness,inno-vation, and integration since its establishmentin the 1990s. Specialist and creative activitiesalso hold a significant place in the school’sactivity. It organises conferences, seminars,and other specialist events and it cooperateson projects in the Region, the Czech Republic,and Europe. (http://portal.vsp.cz)COLLEGE OF SOCIALAND ADMINISTRATIVE AFFAIRSIN HAVÍŘOVThe accreditation of the College of Socialand Administrative Affairs in Havířov and thegranting of government approval dated 30November 2007 were the crowning of the ef-forts of Havířov at obtaining a high educationstatute. The founder of this private college isthe Havířov Institute of Lifelong Education,o.p.s. (public benefit organisation). Studentscan choose from two programmes: PublicEconomics and Administration and Manage-ment and Social Affairs. (www.vsss.cz).The Region is home to three universities: theVŠB-Technical University of Ostrava, Univer-sity of Ostrava, and Silesian University in Opava.There are two other higher education institu-tions present in the Ostrava region: BusinessSchool in Ostrava and the College of Social andAdministrative Affairs in Havířov. In total, therearealmost50000studentsintheRegion,whicheach year generates thousands of graduateswho have ties to the Region and the necessaryeducation. Last but not least, the dense univer-sity network represents nutritious soil for com-paniesandentrepreneurswhocanchooseanddevelop suitable students during their studiesand thus invest into the future of the company.VŠB-TECHNICALUNIVERSITY OF OSTRAVAThe VŠB-Technical University of Ostrava is oneof the top technical universities in the CzechBuilding of the VŠB-Technical University of Mining, Ostrava

| 3 4R E G I O NCompany of the Year: Gamin s.r.o.Gamin s.r.o. was established in1994. "Last year we celebrated our15th anniversary, and so, as we arepersuaded, the period of teeth-ing troubles is over for us and nowa promising future lies ahead,”Ms Radana Brábníková, the company’sExecutive Director, says.Although Gamin was founded by twoengineers, most of its employees todayare women. The company, whose specialis-ation is the surface treatment of metals,has a turnover of more than CZK 23 million(approx. EUR 920 000). About 85% of itsturnover is accounted for by imports, andthe company management is now work-ing hard to raise its export ratio. Togetherwith its affiliation in Slovakia and externalworkers, the company is run by 12 people.Their motto, by which they are all guided,is: Openness, a motivating and easy atmos-phere, and the possibility to participate inessential decision-making and the furtherdevelopment of the company.APPRECIATION FOR GAMINThis may be one of the reasons why lastyear the firm won an all-European awardfor metallisation equipment from the USmanufacturer, Thermion. “Although thereis a crisis and engineering is affected quiteheavily, everything goes better when theoffer is made with grace by lady-manag-ers like us,” says Radana Brábníková, witha smile.MORE BRANCHESBesides the Czech market, Gamin operateson the Polish, Dutch, and Slovak markets.“This year we opened a branch in Písekto be closer to our clients in the CzechRepublic. Another problem and a long-term threat, in addition to lower demand,in my opinion, is a lack of strongly mo-tivated employees living and breathingfor the firm,” Brábníková says. The firm,based in the Moravia-Silesia Region, hasa large number of interesting orders onrecord. Its products are tested in labora-tories of car factories such as Kia Slovakia,Peugeot Citroën Trnava, Toyota PeugeotCitroën Kolín, and Hyundai in Nošovice.Gamin’s talks with Korean manufacturersare among the firm’s greatest businessexperiences.ENLARGEMENTOF THE PORTFOLIOFrom the outset, Gamin s.r.o. has been theexclusive agent of the British company El-cometer Instruments Ltd, the world leaderin the area of surface finishing quality test-ing. Over the years, the firm’s managementhas significantly enlarged the portfolio of itsmeasuring and regulating equipment andhas added several more product rangesto its programme – corrosion chambers,blasting and varnishing equipment, met-allisation devices and, in response to en-vironmental requirements, equipment forused solvent and water recycling.With time, the firm has spread its rangeof activities to cover other countries – in2005 it established an affiliation in Slo-vakia (GAMIN SK, s.r.o.), and in 2009 thefirm gained the all-European agencyfrom the US manufacturer Termion formetallisation equipment. Recently, thefirm enlarged its sales activities, to whichit added its own servicing. Last but notleast, Gamin also concerns itself witheducation and training in the area of sur-face treatment and organises courses onvarious subjects for clients.More at www.gamin.czMOST IMPORTANT IS THE BUILDING OF FAIR RELATIONSHIPSCzech Business and Trade asked Gamin’s Executive Director Radana Brábníková for aninterview. Here are the questions and replies:What does your success in the competition for the Firm of the Year of the Moravia-SilesiaRegion mean to you?Naturally we have been greatly pleased with the award. At the time of the award, we were allgreatly excited, but from the long-term point of view I believe that more important for our tradepartners is the long-term building of fair relationships, mutual confidence, the observance ofwhat has been agreed. The award is rather just cream on the cake.What are the company’s plans for the future?In the near future we’ll be working hard to promote the export of our products and broadenthe range of our services, including education. One of the most essential tasks awaiting us is thereconstruction of the company’s headquarters and the creation of a representative seat.Photo:Gamins.r.o.archivesRadana BrábníkováExecutive DirectorGamin s.r.o.

inzerceD PLSKAPRAHAOSTRAVABRNOTheMoravian-SilesianRegion–MassiveAttractionforInvestmentsThe Moravian-Silesian Region, the most populous of the CzechRepublic’s 14 regions, boasts a strong engineering and heavy industrytradition. Recently, however, it has undergone a period of dynamicdevelopment and prosperity, with its business and industrial struc-ture changing beyond recognition. Mining activities have beenseverely scaled down and new companies have arrived with projectsin the areas of Information Technologies, electronics, and electricalengineering. A number of foreign investors have taken advantage ofthe favourable conditions offered by the Region for business activities,which applies in particular to car manufacture and its know-how.Businessmen and entrepreneurs will find a large number of indus-trial parks in the Moravian-Silesian Region, whose occupancy rangesabove the national average. The best-known is the Nošovice Indus-trialPark,thelocationwhereHyundaihassituateditscarfactory.OneoftheRegion’scompetitiveadvantagesistheLeošJanáčekAirportinOstrava, which links up with an industrial and public logistic zone.The Moravian-Silesian Region has a large number of brownfields.Many of them have already been regenerated, or are in the proc-ess of regeneration, but quite a number are still waiting for exploit-ation and new investors.The Moravian-Silesian Region has a strong tradition of corporateresearch and development in the area of industry. Recently, ad-vanced research has successfully been started here, with the aimof responding to the latest sophisticated requirements of the ap-plication sphere. An example is the research of InformationTechno-logies and new materials for the automotive industry.To support the public sector and businessmen in general, the Re-gion set up an agency in Ostrava in 1993– the Agency for RegionalDevelopment, a.s. - as a pilot project of the European Union, andin 2008 the Moravian-Silesian Region became its owner. Its tasksare the creation of conditions for drawing money from EU funds,support of the development of business properties, brownfield re-generation, and human resources development.Mgr.MartinRadvanDepartmentforRegionalDevelopmentandTourismMoravian-SilesianRegion–RegionalOffice28.října117,70218 Ostrava,CzechRepublicPhone:595622540E-mail:martin.radvan@kr-moravskoslezsky.czwww.kr-moravskoslezsky.czIng.PetraChovaniokováAgencyforRegionalDevelopmentNaJízdárně7/1245,70200 OstravaCzechRepublicPhone:595691210E-mail:chovaniokova@arr.czwww.arr.cz

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3 |C Z E C H E N G I N E E R I N GCzechEngineeringSupplement ofCzech Business and Trade 3/2010CONTENTSEditorial 4ANALYSISCzech Engineering Industry Has not BeenWashed AwaybyTsunami of Global Recession 4Second Breath of Czech MachineTool and Forming Machine Industry 7Results in MachineTool and Forming Machine Sectorin the Czech Republic 9INVESTMENTEngineering – the Most Favoured Sector for Investment 10INFORMATIONEuropean Machine Tool Industry Taking a Turn forthe Better This Year 12CZECH TOPInnovation from Varnsdorf 13The Customer Comes First 14WE ARE INTRODUCINGCzech ICT and Topical Opportunities for Cooperation 15ENTERPRISEObjective: To Develop Markets and Work Together 16SANS SOUCI in Dubai 18EDUCATIONStudy of Technical Branches Is not Just a Trend 21RESEARCH AND DEVELOPMENTTenYears of Machine Tool Research in Prague 24SURVEYPoll of Successful Companies Operating in the Areaof Engineering and Related Branches 25PRESENTATION OF FIRMS:Böttcher ČR , k.s.; Česká exportní banka, a.s.; EXPRESS-INTERFRACHTmezinárodní spedice CZ s.r.o.; KOVOSREAL s.r.o.; KOVOSVIT MAS, a.s.;NOEN, a.s.; TOS KUŘIM - OS, a.s.; TOS VARNSDORF a.s.; TOSHULIN, a.s.;Veletrhy Brno, a.s.MK ČR E 6379This magazine is published as a supplementof the Czech Business and Trade economic quarterly.Managing Editor: Šárka KratochvílováGraphic Design: Art Director: Nina NovákováGraphic Designer: Jiří Hetfleisch, Anežka ZvěřinováProduction: Anežka ZvěřinováAddress: PP Agency s.r.o., Myslíkova 25, 110 00 Praha 1Czech Republic, Phone: +420 221 406 622Fax: +420 224 930 016, e-mail: journal@ppagency.czwww.ppagency.czDeadline: 15/6/2010Attitudes expressed by the authors of articles in this magazineare not necessarily consistent with the viewpoint of the Publisher.© PP Agency, Company with the ISO 9001 certified qualitymanagement system for publishing servicesCoverphoto:www.sxc.hu;page3photo:www.sxc.huIN THE NEXT SUPPLEMENT TO CZECH BUSINESS AND TRADEThe chemical and pharmaceutical industry in the Czech Republic has along tradition. Thanks to thedramaticadvancesinthechemicalindustry,livingstandardsarerisinganddiscoveriesinpharmacypro-longpeople’slives.ThenextsupplementtotheCzechBusinessandTradejournalwillgiveanoverviewofthechemicalandpharmaceuticalindustryandbringanoutlineofitspossiblefuturedevelopment.

A N A LYS I SDear Readers,the engineering industry has alwayshad a strong position in the Czech Re-public, Czechs are well-known for theircreativity, there is a large number of in-ventors who have designed machinesthat are used all over the world. Czechquality machines have a high chanceto succeed on the international mar-ket, a great part of their production isdesigned for export. Although 2009brought shocks to the Czech engineer-ing industry, excellent companies havesurvived the crisis and are continuingto build their technological base. Themarket did halt for a time, but this hap-pened all over the world. However, thefirst signs of recovery have been ap-pearing since the spring. This is evidentalso from a statement of the interna-tional group of national associations ofmanufacturers from fifteen Europeancountries known as CECIMO, fromwhich we quote below.Among the articles, we would like todraw attention particularly to the an-alysis of the Czech engineering industryand to the survey of the Czech machinetool and forming machine industry.Furthermore, you can learn aboutimportant international engineeringfairs to be held in the coming months,and information about other eventsis provided also elsewhere in thesupplement.Šárka KratochvílováCzech Engineering IndustryHas not Been Washed Awayby Tsunami of Global RecessionPerhaps the motto most frequently quotedby Czech industrialists is “Crisis is a chance“. Itexpresses the viewpoint of many engineer-ing company management boards which,although surprised by the economic cool-ing at the end of 2008, succeeded in reactingquickly and creatively and thus mitigating theblow of the global recession which hit theentire economy. Its synchronous impact ontheir most important foreign markets, whichare Germany and the Commonwealth of In-dependent States, was a great shock to theexport-oriented Czech economy.Now it is becoming clear that Czech indus-try, which creates roughly 30% of the Czechgross domestic product, and its backbone,the engineering industry, are already recover-ing from the impact of the global recessionand the decline in production.As the Economic Outlook of June 2010,published by the Confederation of Europe-an Business (BUSINESSEUROPE) shows, theCzech Republic has successfully coped withthe impact of the recession.“It fared relativelywell in the assessment, along with Denmark,Germany, and Austria it was assessed amongcountries weathering best the impact of thecrisis“, the analysis showed.Tradition and InnovationThe consequences of the recession for theCzech economy would have been felt evenmore had the Czech engineering sector,and industry as a whole, not demonstrateda considerable rate of resistance. It should benoted that its forte is a tradition of more than150 years, when a number of firms producingworldfamousbrands,suchastheŠkodaworksmanufacturingcars,locomotivesandturbines,or ČKD, the producer of motors and railwaycarriages, originated in the country. In the areaof transport engineering, the list of productsincluded the Tatra, Avia and Liaz trucks, Zetortractors, Jawa motorcycles, Karosa buses, orAero aircraft. In the 1930s, the then Czecho-slovakia ranked among the ten most impor-tant engineering countries in the world, and itmaintained this position for a long time.This tradition is also linked with a technicallyeducated workforce, a system of educationwhich is to be reformed in the near futureto strengthen technical disciplines. Manyresearch institutes developed hand in handwith the engineering sector.Naturally, the sector has experienced pro-found changes. The decisive ones took placein the last twenty years when the economywas transformed, state-owned companieswere privatised and their property structurechanged further. In many cases former con-cerns were divided so that two-thirds of engi-neeringfirmsarenowaccountedforratherbysmaller medium-sized enterprises.Production EffectivenessIs GrowingA fact characteristic of the Czech sector - thelight, medium, heavy, precision, and invest-ment engineering - is that, following the re-structuring, companies have considerablyslimmed down and their production mademore efficient. They had to cope especiallywith the initial disintegration of the Easternmarkets in the 1990s, and in many cases reori-entate to the demandingWestern customers.In addition, they are gradually losing theadvantage of lower production costs.This hasled Czech producers to be more innovativewith new products and significantly increasetheir quality. Particularly under pressure fromPhoto:www.sxc.huMilan Mostýn, Confederation of Industry of the CR, e-mail: mmostyn@spcr.cz, www.spcr.cz

5 |C Z E C H E N G I N E E R I N GAsian competitors, it is vital for Czech firms tomaintain their market position by manufac-turing machines with a high value added.It was precisely due to these fortes thatengineering companies have succeeded inovercoming the period of the deepest down-turn in demand of the last two decades. It isironic that 2008 was the most successful yearever in quite a number of segments of engi-neering production.Companies ReactedCreatively to CrisisThe successful reaction of engineering com-paniestotherecessionwasprovedbysurveysconducted by the Confederation of Industryof the Czech Republic (SP CR) among its 1600member organisations quarterly from Octo-ber 2008 to June 2010. They show that whilefirms sought to reduce costs, they simulta-neously exerted enormous effort to increaselabour productivity, intensified their search fornew markets and their marketing activities.Some firms increased investment in innova-tions and improved the qualifications of theiremployees. Mainly thanks to these measuresengineering firms have been able to increasetheir global competitiveness.“This year, too, most firms (53%) continueto cut costs and a half of them to increaselabour productivity, and two-fifths of them(42%) their search for new markets,“ the SP CRsurvey notes.Different Reactions of BranchesIt is natural that different segments of the en-gineering industry and different companieswere hit by the recession to a diverse intensi-ty. For example, the manufacture of machinetools and forming machines dropped by one-third in 2009 year-on-year. For the secondhalf of the year 2010, company executives aremoderately optimistic.The greatest problem is the time lag in thedemand for machines, which will not be re-flected positively in the companies‘ economybefore 2011 at the earliest. “Even if, from dayto day, something so improbable happenednow, such as that the recession would endand the economy in the whole world wouldget to an upward trajectory, our sector wouldrecord such a change only with a certain de-lay“, says Ivan Čapek, Managing Director ofthe Association of Engineering Technology,a member organisation of the SP CR.These conclusions are based on two cir-cumstances. The first one is that the facto-ries which need machines will initially startlooking for production reserves in their ownoperations and most probably “resuscitate“capacities that have been scaled down. Thus,at first they will put into operation machinerythat has been lying idle or is little used.The second circumstance is that after therecession, the world market will be floodedwith “second-hand“ machines from compa-nies which did not weather the recession andfailed. In Europe alone, hundreds of factorieshave been forced by the economic crisis toclose down and their machinery will now beavailable cheaply.“New machines are not cheap. In manycases managers will thus decide to purchasean older machine of comparable quality athalf-price“, Ivan Čapek notes. The decisionwhether to purchase new machines or notwill also depend on how Czech companiessucceed in combining a high technical qual-ity and services with an acceptable price.Many of them have good experience in this.Crisis Has Been Felt Even bythe Largest ManufacturersIn particular small and medium-sized firmsexperienced difficulties because of the re-cession, the one-hundred strongest Czechcompanies lost CZK 200 billion (approx. EUR8 billion) in 2009. For example, as this year’sannual rankings of the Czech TOP 100 largestcompanies show, these firms earned 8% lessbecause of the crisis.The situation has been commented byRichard Hindls, Rector of the University ofEconomics in Prague, which participated inthe drawing up of the list. “These large firmsmaintain a stable performance, whether theyare companies from the area of engineering,telecommunication technologies, or car in-dustry“, Richard Hindls said.TheWorst Is OverSimilarly, other experts are also noting that forsome sectors the worst is already over. An ex-ampleisthemotorindustry,whichcreatestenper cent of the Czech gross domestic prod-uct.The Czech Republic is thus a world powerin the manufacture of vehicles, both cars andtrucks. It has acquired this status thanks to tra-dition, as well as to investments by foreign carmakers, especially theVolkswagen concern inŠkoda Auto, but alsoToyota, Citroën, Peugeot,Hyundai,andAshokLeyland.Inaddition,theseautomobilemanufacturershavebroughtwithSELECTED EXHIBITIONS AND FAIRSMSV 2010, Brno 13–17 Sept. 2010, Exhibition Centre52nd International Engineering Fairwww.bvv.cz/msvIMT 2010, Brno 13–17 Sept. 2010, Exhibition Centre7th International MachineTools Exhibitionwww.imt.czIMTS, Chicago, IL 13–18 Sept. 2010International ManufacturingTechnology Showwww.imtsnet.orgBI-MU, Milan 5–9 Oct. 2010Exhibition of machine tools, robots, and automationwww.bimu-sfortec.comJIMTOF,Tokyo 28 Oct. –2 Nov. 2010International fair of machine toolswww.tokyo-bigsight.co.jpPRODEX, Basel 16– 20 Nov. 2010International exhibition for machine tools, tools, andproduction measurementwww.prodex.ch

| 6A N A LYS I SMachine Tools WorldKOVOSVIT MAS, a.s.MULTICUT 500 - multioperational turning-milling centreƒ Max. turning diameter: 690 mmƒ Max. turning lenght: 1 500, 3 000 mmƒ Spindle output: 59 / 74 kWMCU 630/800V-5X - five-axis vertical machining centreƒ Rotary table top dia: 630 / 800 mmƒ Max. weight on table: 850 kgƒ Spindle output: 25 / 35 kWProducer of exact and productive CNC 5-axis machine tools for the aviation, automotiveand railways industries, health industry, energy sector and the production of moulds.WWW.KOVOSVIT.CZthem lots of investors-subcontractors, also inthe area of transport engineering.Notwithstanding the recession, in 2009 theCzech Republic retained its position of the 5thlargest European car maker and is the 2nd larg-est car manufacturer in the world per inhabit-ant (95.5 cars/1000 inhabitants/year). “The dif-ferent production segments of the automotiveindustry have been affected by the economicrecession with varied intensity. Car productionscored good results. A record number of carswas produced in the Czech Republic in 2009and thanks to this, the total production of roadvehicles exceeded the one-million mark“, saidMartin Jahn, President of the Automotive In-dustry Association and SP CRVice President.The favourable development in the motorindustry had a positive effect also in othersegments of the engineering sector.However, there are also other examples ofsuccessfully overcoming of the impacts of therecession.These include the manufacturers oflarge machines.Thus, companies which needthese large machines must address the man-ufacturers well in advance. In the Czech Re-public these producers includeTOS Hulín andŠkoda Machine Tools. Some smaller subcon-tractors and producers of farming machinesare also working at full throttle.Outlook of CzechEngineering SectorEven the economic cooling has not reducedthe importance of the engineering industryand neither the structure nor the orientationof manufacturers are changing for the timebeing. Despite that, the sector probably facesa revolution. Its basic feature will be a shift toclean technologies.The sector will also be influenced by chang-es in other branches. It will be particularly inthe area of energy production and distribu-tion, and the reduction of energy intensity,although this already receives attention. Thecomplementing of classical sources of elec-tricity with alternative ones requires not onlynew technologies but also different produc-tion procedures.According to a number of studies, manu-facturing will require optimisation of the useof macro- and micromechanical and elec-tronic elements to achieve a further degree ofenergy and ecology thriftiness. Emphasis willbe placed on automatic control of the opera-tion of sets of machinery and equipment.In the area of research and development ofmachine construction, there is growing needfor activity-based simulation of future oper-ation, technical design, safety and, last but notleast, production quality management. In thiscontextitisevidentthatcompetitivenessoftheCzech engineering sector will require furthermore pronounced support to research and de-velopment in future-oriented branches.A number of innovations were presentedfor example at the International EngineeringFair in Brno in 2009. In September 2010, the52nd edition of the Fair will also bring newdevelopments focused on innovative tech-nologies for reducing environmental impacts,with emphasis on renewable energy sources,energy self-sufficiency and saving.It will also introduce technological trends inthe automation of production, including theeffort to establish integrated manufacturingenterprises able to react quickly to the con-stantly changing market demand as well as tothe emergence of sudden global upheavals.

7 |C Z E C H E N G I N E E R I N GSecond Breath of Czech Machine Tooland Forming Machine IndustryŠárka Kratochvílová, PP Agency, e-mail: kratochvilova@ppagency.cz, www.ppagency.czLathes, drilling and boring machines, mill-ing machines, grinders, planers, broach-ing machines. Presses, power hammers,benders … Even this is not a complete listof machinery in the category of machinetools and forming machines that haveformed the central line of the Czech en-gineering industry for decades. Thanks tothese machines, production equipment ismade for other industrial sectors. What isthe current situation of this branch in theCzech market where export is crucial, andwhat are its prospects?Globally, the production of machinery iscurrently in a slump. A considerable rise inthe prices of raw materials has been con-stantly increasing competitive pressure inthe engineering sectors. It is becomingmore and more important to manufactureat optimum costs, not only because of thefall in orders. “However, greater efficiencyin production will be felt only if we jointhe present development and modernisethe process and production in time. Handin hand with this goes the improvement inhuman resources“, says Jiří Kapounek fromthe Association of Engineering Technol-ogy Prague. Moreover, who can hesitateat a time when foreign investors, tryingto cut costs, are moving manufacturing toother parts of the world, where they ex-pect to run more advantageous produc-tions in financial terms. The best answerto this trend is to invest in production ina manner that would bring substantialcuts in production costs.Clear StatisticsAccording to statistics published by theEngineering Technology Association, theexport of machine tools and forming ma-chines in the Czech Republic was worthEUR 418.57 million in 2009. This resultconfirmed the adverse effect of the cur-rent economic crisis. Compared with thehighly successful year 2008, the overallexport of machine tools and formingmachines dropped by almost 26%. Thisroughly reflects development in the Euro-pean area. 2009 import of machine toolsand forming machines in the Czech Re-public amounted to EUR 214.16 million,a 54% drop year-on-year. The decline ofsome 40% in both production and ex-port is not very encouraging, as the pros-pects for 2010 do not give much hope ofa substantial improvement. For example,the meeting of the European MachineTool Industries in Spain in the summer of2009 noted that a gradual re-start of in-vestment in new machining technologiescould be expected from 2010, but the re-covery would be slow.Giants in EngineeringYou need not have much practical ex-perience to see one thing – mergers andthe formation of international concernsand holdings is a world-wide trend whichhas not shunned the engineering sector.Through the process of economic amal-gamation, the giant companies then suc-ceed in substantially lowering productioncosts, diluting the cost of research anddevelopment, and subsequently of theproduction of new machines, and thuspenetrating ever new markets. For smallCzech companies it is very complicated tocompete with these production giants. Itis thus crucial which markets the particu-lar Czech firm may wish to penetrate. Ifit intends to produce machines in largequantities, an alliance will be essential,whether on the economic or trade level.According to top executives of leadingCzech companies in the sector, this wouldbe facilitated by legal amendments thatwould simplify and shorten the process.Czech firms often consider various formsof links with larger companies becausethey believe that large customers area priori distrustful of small suppliers.Czech AlliesA certain form of alliance exists withinthe membership of the Association ofEngineering Technology Prague. It existssince 1990 and associates about 40 ma-jor production and supply organisationsengaged mainly in the manufacture andsupply of machine tools and forming ma-chines, metal-working machinery, toolsand measuring devices, hydraulic ele-ments and units. As practical experienceillustrates – “no-one can do just one thingany more“. For example, the developmentof new technologies is conducted jointlyunder the aegis of the Research Centreof Manufacturing Technology. The jointresearch and development is aimed atkeeping the country among world leadersin the sector of machine tools and form-ing machines.Production “at Home“at Times of CrisisAnother clear trend on the world marketsis that at the time of crisis, when work isscarce, companies withdraw productionback under their wings, not to lose theirknow-how, skilled labour, and possiblecompetitive advantages. On the otherhand, at the time of boom everybody con-centrated on work with the highest valueadded. These times are gone long ago.New MaterialsA great future is envisaged in the area ofmachine tools and forming machines fortitanium and other noble materials fornew technologies. These new materialsare being used increasingly and machin-ery must be adapted so that they can beutilised and worked. For most companiesthis means a profound change in thestyle of development and thinking. ForSUPPORTED EXHIBITIONSAs the sector of machine tools and forming machines ishighly important for the Czech economy, support for thecompanies‘ participation in fairs and exhibitions has in-creased.The following is the calendar of exhibitions up tothe end of 2010:IMT International Machine Tools Exhibition 2010 Brno:13 - 17 September 2010AMB2010,Stuttgart:28September-2October2010TIB Bucharest: 6 - 10 October 2010MACTECH Cairo: 8 - 11 October 2010MASHINOSTROENIJE MOSCOW: 26 - 29 October 2010Metalworking Shanghai: 9 - 13 November 2010

| 8A N A LYS I SPhoto:www.sxc.huinstance, machine tools were used for 60 years to work iron andcast iron, and construction and technology were adapted to it.At present the change does not mean only the conversion ofa standard type of machine into machinery capable of workingwith titanium. Indeed, the changes must be incorporated intothe process of development of a machine from the very begin-ning. Another aspect of the current trend is the great emphasisplaced on the environment and low energy intensity.Support for EducationCurrent research shows that in a year-on-year comparison thenumber of students applying for admission to Czech technicaluniversities has been rising again after a long time. This may bepartly due to positive steps taken lately by large industrial firmsand also by some regional governments. It is necessary to main-tain a skilled labour force and employment especially in thoseindustrial branches which, although hit by recession, have thechance to become the driving force of the Czech economy oncethe crisis is over.Eastern MarketsExperts recommend greater attention to Eastern markets. This, too,could help Czech engineering companies in general to cope withthe aftermath of the economic crisis. Many Russian factories useCzech technology and trust it. As the Director of the Association ofEngineering Technology, Ivan Čapek, has noted, it is vital to negoti-ate intensively about sale and cooperation in eastern markets andpay particular attention to what the Russian market needs.How the State Will HelpThe principal issue for the Czech engineering industry and theproduction of machine tools and forming machines is export.The worsened access to financial resources and their lower avail-ability also for the potential clients of Czech exporters is one ofthe reasons for the drop in foreign demand for new supplies ofgoods which form the bulk of Czech exports (machinery, equip-ment, transport equipment, including machine tools and form-ing machines).Exporters can be aided by an amendment to Act No. 58/1995Coll., on Insurance and Funding of Exports with State Support.The amendment will allow greater participation of commercialbanks in state-supported credits and export insurance throughthe mechanism of equalisation of interest differences. The sys-tem will help to increase the comfort for Czech exporters. An-other major element is the shift in approach from support forthe export of goods of national origin to support for export inthe national interest. This means that the possibilities of financ-ing and insuring exports and investment credits will be extendedto Czech-controlled foreign companies.Other good news for Czech exports is the increase of the reg-istered capital of the Czech Export Bank (CEB) which makes itpossible to grant support at the amount of additional CZK 20-25billion (about EUR 0.756 – 0.945 billion). The insurance capacity ofthe Export Guarantee and Insurance Corporation (EGAP) has alsoincreased, to CZK 150 billion (approx. EUR 5.67 billion). Thus nowell-prepared export project requiring this form of insurance andfunding will fail because of the lack of CEB and EGAP resources.

9 |C Z E C H E N G I N E E R I N GResults in Machine Tool andForming Machine Sector in the Czech RepublicZdeněk Cvrkal, Association of Engineering Technology, e-mail: cvrkal@sst.cz, www.sst.czExport of Machine Toolsand Forming Machines fromthe Czech Republic in 2009The Czech Republic’s export of machinetools and forming machines was worth CZK11 071.3 million (approx. EUR 420 million)in 2009. This result confirmed the negativeimpact of the ongoing economic crisis.Compared with the extremely successfulyear 2008, the total export of machine toolsand forming machines dropped by almost26%, which roughly copies the fall of exportin other CECIMO member states. An analy-sis of the results by the tariff nomenclatureshows a slight increase in exports only in theHS 8457 group, in the other HS (HarmonisedSystem) groups exports decreased.Import of Machine Toolsand Forming Machines tothe Czech Republic in 2009The Czech Republic’s import of machinetools and forming machines was worthCZK 5 664.5 million (approx. EUR 215 mil-lion) in 2009, which is almost a 54% declineyear on year. The largest drops in terms ofvolume occurred in the groups HS 8456,8457, and 8458. The import of machineryto the CR by territories did not change incomparison with 2008.Export of Machine Tools and Forming Machinesfrom the Czech Republic in 2009Import of Machine Tools and FormingMachines to the Czech Republic in 2009Tab. 1: Export of Machine Tools andForming Machines from the CzechRepublic by Territories in 2009in CZKmillionin EURmillionGermany 3 368 127.335Russia 1 493 56.446Slovakia 890 33.648Poland 575 21.391China 559 21.134Austria 452 17.089Italy 438 16.559Other 3 410 128.923Tab. 2: Import of Machine Tools andForming Machines to the CzechRepublic by Territories in 2009in CZKmillionin EURmillionGermany 2 079 78.601Italy 578 21.853Japan 563 21.285Switzerland 354 13.384Austria 221 8.355China 202 7.637Slovakia 196 7.41Other 1 512 57.164Harmonised System groups: 8456 - Machine tools for material removal by laser, etc; 8457 - Machining centres, unit construction machines andmultistation transfer machines; 8458 - Lathes for removing metal; 8459 - Machine tools for drilling, boring, milling, threading or tapping; 8460 -Machine tools for deburring, sharpening, grinding, honing, lapping, etc ; 8461 - Machine tools for planing, shaping, slotting, gear cutting, etc ; 8462- Machine tools for forging, bending, stamping, etc; 8463 - Machine tools for working metal by forging, hammering, die stamping, etc.2009 20084 5004 0003 5003 0002 5002 0001 5001 00050008 456 8 457 8 458 8 459 8 460 8 461 8 462 8 463CZKthousand2009 20084 0003 5003 0002 5002 0001 5001 00050008 456 8 457 8 458 8 459 8 460 8 461 8 462 8 463CZKthousand

| 1 0I N V E S T M E N TEngineering – the Most FavouredSector for InvestmentJiří Sochor, CzechInvest, e-mail: jiri.sochor@czechinvest.org, www.czechinvest.orgInvestment exceeding two and a quarter bil-lion dollars and almost twenty thousand newjobs has been brought to the Czech Republicby mostly foreign investors in the engineeringindustry in the last few years. If the produc-tion of transport equipment is added to thecategory, engineering will be clearly the mostsought-after area of foreign investment in theCzech Republic.SolarTurbines in North BohemiaFor example, a few months ago the Caterpillarcompany, or specifically its subsidiary SolarTur-bines, has decided to build a service facility innorthBohemiafortherepairsandrenovationofitsindustrialgasturbinesfromthewholeregionof Europe, Africa, and the Middle East. Caterpil-lar has a similar facility only on the other side ofthe planet, on the American continent. Appar-ently, Caterpillar has taken a liking to north Bo-hemia because it has also opened an AFSI filtermanufacturing plant there in 2010.Dynamic Investment DevelopmentInvestment in engineering in the Czech Re-public is experiencing a dramatic develop-ment. Statistics of the CzechInvest govern-ment agency, which attracts foreign investorsto the Czech Republic, show that while for ex-ample in 2004 twenty-one investors in manu-facturing came to the Czech Republic andanother two companies made investment inresearch and development, five years later theratiowasreversed–sixcompaniesinvestinginmanufacturing and as many as 26 in researchand development in the engineering sector.Skilled Labour,Quality Management“Investors have already gained the experiencethat we are a country where their projectsprosper very well. Skilled labour, quality man-agement – all this has convinced them quitequickly that they benefit by bringing to us alsoresearchanddevelopment.Allthisisnowclearfrom our statistics“, Ms Alexandra Rudyšarová,CzechInvest’s CEO, explains the trend of thelast few years.Economic AdvantagesThe latest example is the company EdwardsVacuum. It has decided to scale down its activ-ities elsewhere in the world and concentrateits production of vacuum pumps in South Ko-rea and the Czech Republic. Besides manufac-turing,itsCzechoperationwillalsotakecareofpart of research and development. The mainreasons?AccordingtoEdwardsVacuum,theseare the advantageous geographic position inthe middle of Europe and, compared withthe old EU members, the more advantageouseconomy of costs.VariousTypes of InvestorsEdwards represents one typical group of in-vestors – those who cautiously test the CzechRepublic with simple projects at first and sub-sequently train specialists also for the smartestinvestments. A second group of the recentmonths is formed by those who have beenforced by the global economy cooling to seekmore effective ways of manufacturing, wheth-er by relocating their businesses or choosingnew suppliers – who, however, need new lo-cations for more cost-effective production.“A newly arriving investor to the Czech Re-public has the best possible conditions thathave ever existed in the Czech market and willexist for a long time to come“, Ms Rudyšarovásays. “People seek jobs and low rents can beagreed for many years ahead because devel-opersneedfundingand,inaddition,havebuilttheir properties which are now vacant for lessmoney than they could build them becauseof tax changes today.There will never be sucha favourable time again.“PROJECTS MEDIATED THROUGH CZECHINVEST IN 2009SectorNumber ofprojectsInvestment(mil. CZK)Investment(mil. USD)Newly createdjobsbiotechnology, medicalequipment3 47.74 2.55 28strategic services centre 13 170.52 8.71 921paper, wood processing 4 743.04 41.09 207electronics,electrotechnics20 1 923.36 105.22 1 895plastics, rubber 8 148.12 7.52 46chemistry, pharmacy 14 2 000.65 97.12 98IT and softwaredevelopment52 651.46 34.54 576metal products 5 78.80 3.98 20engineering 32 2 196.86 111.38 422manufacture of motorvehicles8 3 625.30 177.60 847other 27 5 303.07 286.15 709TOTAL 186 16888.91 875.87 5 769Photo:CaterpillararchivesPeterTaylor,Vice-President of Engineering and Manufacturing (Caterpillar), and JanaVaňková, President of the Usti Region

L E G I S L AT I O N

| 1 2I N F O R M AT I O NEuropean MachineTool IndustryTaking aTurn for the BetterThisYearwww.cecimo.eu, www.sst.czThe special-interest Association of Engineer-ing Technology has been operating in theCzech Republic for 20 years. It associatesabout forty major manufacturing and sup-plier organisations which produce and de-liver mainly machine tools, woodworkingmachines, and similar machinery. The Asso-ciation is a member of the prestigious inter-national organisation of national associationsof manufacturers from European countriesknown as CECIMO (European Associationof the Machine Tool Industries in Europe).It brings together 15 national associationsof machine tool manufacturers, which rep-resent approximately 1600 industrial enter-prises in Europe. CECIMO covers more than97% of machine tool production in Europeand more than 40% worldwide. In 2009, com-panies of the association employed morethan 150 000 people and had a total turno-ver of EUR 17 billion. More than half of theproduction is exported outside Europe.Better Times in EuropeThe Economic Committee of this large as-sociation met in Leipzig in May 2010, whereit confirmed that the machine tool industryis slowly recovering in Europe. During theGeneral Assembly, the CECIMO EconomicCommittee confirmed the following:an upturn in machine tool orders since the4th quarter of 2009,the recovery is led by the emerging mar-kets in Asia. CECIMO pleads for better mar-ket access to these economies, especiallythe removal of non-tariff barriers,its full support to the EU key enablingtechnology initiatives and the Free TradeAgreement with South Korea.Current TrendMachinetoolordersturnedaroundinCECIMOcountriesattheendof2009,afterdroppingbyover 50% in the first quarter of 2009 (in com-parison with the same period one year earlier)as a consequence of the financial crisis. MrMichael Hauser, President of CECIMO, explainsthat “…since order backlogs are still very low,it will take a few more weeks before the turn-around is clearly observed in sales“.China’s DevelopmentRecovery in the European machine tool in-dustry is stimulated by a growing need in theemerging markets, especially China. Despitethe severe crisis in the sector in 2009, the glo-bal market share of machine tools exportedfrom CECIMO countries rose from 55% to61%. This proves the competitiveness of theEuropean industry in global markets. CECIMOexpects this trend to continue in 2010.Certain LimitationsIt will take some time for European con-sumption to recover, as capital investmentin the traditional end-user industries is stilllow, capacity utilisation is below averageand credit is still difficult to get, especially forsmall companies.The current financial insta-bility associated with the sovereign debts ofsome European countries may also hinderthe necessary cash flow that is required byindustry to invest in modern and energy ef-ficient production equipment.New Access to MarketsThe geographical shift of the machine toolconsumption towards the emerging mar-kets of Asia and Latin America makes ittherefore necessary for the European ma-chine tool industry to obtain fair and non-discriminatory access to those markets.“The economic crisis has unfortunately ledto a revival of some national reflexes, demon-strated by a surge in small-scale national ini-tiatives which are often more of a hindrancethan a help to boosting the economy“, saysMr Frank Brinken, Chairman of CECIMO’s Econ-omic Committee. Such obstacles (as the re-centlyintroducedmachineimportregulationsin South Korea) often take the form of addi-tional local certification or of some significantdelays in getting import or export licences.Free TradeFreetradeagreements,suchastheEU-SouthKorea agreement, are expected to eliminatesuch non-tariff barriers. Therefore CECIMOis a strong proponent of this agreement.Even though it understands the mitigatedposition of some sectors regarding theduty drawback and the safeguard clauses,CECIMO requests that the European Councilaccepts a provisional implementation of thefree trade agreement before the EuropeanParliament gives its final consent.Promising InitiativesCECIMO holds high expectations of two re-cent initiatives launched by the EuropeanCommission: of the European strategy for thekey enabling technologies, and the EU 2020Strategy that should include an EU industrialpolicy.CECIMOdirectlyparticipatesinthekeyenabling technologies initiative through theinvolvement of Mr Javier Eguren, Vice-Presi-dent of CECIMO. He was recently appointedto the High-level Group as the representa-tive of the Advanced Manufacturing Systemssub-sector. As such, CECIMO is confident thatthe European Union will firmly establish thenecessary regulatory framework to succeedin paving the way to a smart, green, inclusive,innovative, and globally competitive ma-chine tool sector of tomorrow.Photo:www.sxc.hu,TOSVARNSDORFarchives

1 3 |C Z E C H TO PInnovation from VarnsdorfVarious indicators and signals from the mar-ket seem to suggest that the recession isslowly ending in the machine tool sector aswell. Although we cannot speak about biggrowth yet, the bottom has apparently beenreached and some markets are recovering.We learn this from our partners and see itin the rising participation in exhibitions insome territories.TOS VARNSDORFExpanding its ProgrammeLike all other machine tool manufacturers,TOSVARNSDORF grappled for many monthswith the negative effects of weak demand.And this is precisely the time when it is beingdecided more than ever who has enoughstrength to survive. One of the best waysmanufacturers can take is profound innova-tion or significant extension of a company’soffer. TOS VARNSDORF added an entirelynew element to its production programmein 2009: for the first time ever it began tooffer portal-type machining centres. It wasimportant step number one the companyhas taken towards the future.Innovation, and Innovation AgainHowever, let us first take a look back at thepast. TOS VARNSDORF has more than a cen-tury-old history, the machine tools manufac-turing company was founded in Varnsdorf in1903. The initial medley of various machines,mostly small ones, was improved over time,until the company specialised in the manu-facture of horizontal boring machines afterWorld War II and the subsequent nation-alisation. The motor permanently driving thecompany’s development was its focus on in-novation, every year a new type of machineoriginated, or a new version of machinery al-ready produced was launched. The companyhas operated without interruption since itsestablishment, work in the factory was not in-terrupted by the war, the founder’s death, na-tionalisation, various mergers, nor eventuallyby the post-revolutionary ferment in Czechindustry at the end of last century. Privatis-ation brought a new stage in the company’slife, which is characterised by substantial in-creases in the company’s turnover and labourproductivity, especially in the last few years.Above-averageDiameter SpindlesLet us return to the near future. A special at-tractionamongthisyear’shitsintheproduc-tion programme is the floor-type horizontalmilling and boring machine designatedWRD 170 (Q). TOS VARNSDORF implementsthe rule of coding the “size“ of its machinesinto their names. The “one-hundred-sev-enty“ thus has a spindle of 170 mm diam-eter, which is the first time in the company’sexistence that this parameter has exceeded150 mm. With this machine, the firm has en-tered a new segment of technologies andopened to new clients.Technology forMachining GiantsClients are becoming ever more demandingand suppliers who want to succeed mustoffer solutions that will satisfy these highdemands. The WRD 170 (Q) machine is thepossiblesolution,itsapplicationsarediverse.It can be used to machining very large-sizedand heavy components in many industrialsectors. This includes the manufacture ofwind power stations, steam turbines, shipengines, propellers and other parts of evenlarge surface and underwater vessels, partsfor rail vehicles of all types, for automobiles,and is naturally suitable for the aircraft in-dustry as well. Its advantage is that thanks toits numerous accessories and its parametersit can cover a wide range of technologicaloperations, from heavy machining of 125-tonne workpieces up to five-axis machiningof complex broken surfaces.Customer SolutionsThemachineisa typicalexampleoftherealis-ation that the time of the dictate of purposeis coming: “Customer, tell us what you needto be manufactured, and we will prepare thebest solution for you. It is only up to you whatyou choose and what properties of our prod-uct you will prefer. We will not supply youonly with the machine but also with our ex-perience placed in it and in the technologiesprepared for it. And we will indulge you withan additional offer of services.“Green Light for“Green“ MachinesHowever, trade is not everything. The offeredmachine tools must not only be able to man-ufacture things that will ease the burden onthe ever more tormented nature (let us givethe example of wind farms or geothermalwater pumping equipment or componentsfor photovoltaic systems), but the machinesthemselves should become “greener“. Howmore attractive is a machine from whichvarious liquids do not leak in all directionsduring operation, which does not pollute itssurroundings with noise and vibrations, doesnot ruin the operator’s health with exhala-tions and mist from dispersed emulsions?As much as it is more attractive, so much it ismore in demand. And also more needed andmore appropriate for the future. As we havesaid, a change is bound to come.Ladislav Plaňanský, TOS VARNSDORF, e-mail: lplan@tosvarnsdorf.cz, www.tosvarnsdorf.czTOStec PRIMA portal machining centre

| 1 4C Z E C H TO PThe Customer Comes FirstVendula Švajková, TOS KUŘIM - OS, a.s., e-mail: vendula.svajkova@tos-kurim.cz,www.tos-kurim.czEver since its establishment in 1942, TOSKUŘIM has been a pioneer in putting newtechnologies into practice, and the com-pany’s trademark has become worldwidea symbol of reliability and precise ma-chine tools with long service life. Duringthat time, the firm has delivered some90 000 machines to the whole world. In2005, TOS KUŘIM – OS became part ofCzech Trade company ALTA.The Company’s production programmeis focused on large-size milling machinesand machining centres that enable ma-chining of heavy workpieces of com-plicated dimensions and sophisticatedshapes from as many as five sides, mak-ing use of continuous control in five axes.These include machining centres witha moving column and portal machiningcentres. The production programme alsoincludes customised technological work-places. The main technological asset ofTOS KUŘIM – OS machines is the systemof exchangeable spindle heads. Currently,the company offers heads with outputsup to 100 kW, which allow highly univer-sal uses of the centres from roughing tohigh-speed finishing.Modular Design for UsersIn general it can be said that all universalmachines of TOS KUŘIM – OS are of mod-ular design, enabling the arrangement ofthe working space to suit the user’s re-quirements even with regard to the com-plexity of the technological operations.The universality of the machines, espe-cially the wide choice of spindle heads,allows the optimal adjustment of the ma-chine to technological requirements. Theoperator can choose the most suitablespindle head for a particular operationand make the best use of the maximumcutting conditions and working space ofthe machine. TOS KUŘIM – OS suppliescca 30 different types of spindle heads ofits own design.Wide-rangingApplication and ServiceThe machines have a multitude of uses inheavy engineering, the power industry,the armament and aircraft industries, inthe manufacture of heavy-duty buildingand mining machines, in ship-buildingand the railway industry.The firm’s strategy is based on the phi-losophy of a customer oriented society,where all begins with the identificationof the customer’s needs and ends withpost-guaranty service. The machines arecontinuously innovated, including thecomponents, systems, and accessories,which are supplied by renowned manu-facturers. Adding substantially to the cus-tomers’ satisfaction is the service supportof the machine suppliers. In recent years,TOS KUŘIM – OS has broadened its serv-ices to customers, especially in the areaof remote diagnostics and prompt supplyof spare parts from its well-stocked spareparts warehouse.On-line Contactwith the MachineRemote diagnostics allow the customerthe fastest possible service in the form ofimmediate on-line contact with the ma-chine. This enables the customer to obtainprompt and accurate identification of thedefect with the possibility of its removal.The service is provided for machines withHeidenhain, Siemens, and Fanuc controlsystem. The number of successful inter-ventions increases by tens of percenteach year and the customers’ interest inthis service is growing.Machines to the Whole WorldTOS KUŘIM – OS machining centres areexported to more than twenty countriesthe world over.The largest customer for them is ALTA,a company specialising in sales to Russia,the Ukraine, and Belarus. Machines fromTOS KUŘIM – OS are sold to leading worldfirms, such as OAO Korporaciya VSMPO-AVISMA, Russian Federation; OAO NPKIrkut, Russian Federation; OAO NPK Ural-vagonzavod, Russian Federation; ZAO No-vokramatorskiy mashinostroitelnyi zavod,the Ukraine; AOA BELAZ, Belarus, etc.Other major export destinations arefirms such as GENERAL DYNAMICS LandSystem, Canada; HVF Avadi India; BHEL,India; ORDNANCE FACTORY Kanpur, India,Hiab Balti, Cargotec Corporation, Estonia,etc. The company has recently exportedits first machine also to China.Photo:TOSKUŘIM-OSarchives,CzechICTarchivesGantry-type machining centre with movableportal and movable cross-rail FRUF 450

1 5 |W E A R E I N T R O D U C I N GCzech ICT and Topical Opportunities for CooperationMichal Zálešák, Czech ICT Alliance, e-mail: info@czechict.cz, www.czechict.czThe information and communication technol-ogy sector is experiencing a noticeable de-velopment in the Czech Republic, especiallyin the area of services. This development alsobrings new opportunities for internationalcooperation. The Czech ICT Alliance is an ex-port alliance of CzechTrade, a governmenttrade promotion agency which helps to builda good name for Czech ICT abroad and cre-ates concrete opportunities for pro-exportdevelopment. It cooperates on this long-termtask with another government organisation,the investment and business developmentagency CzechInvest. This article would like topresent to you the particular opportunities forcooperation and to show how important theICT sector is for the Czech economy.Importance of ICT Sectorfor Czech EconomyIn the last few years, ICT in the Czech Republichas seen a very dramatic development, whichis best documented by the following figures:almost 33 000 ICT firms in the Czech Re-public provide jobs to more than 130 000employees,in the last 10 years the export of ICT goodsrose 15-fold to CZK 360 billion (i.e. EUR 13.6billion)in2008,itaccountsforalmost15%oftotal exports, which makes it a very impor-tant export category (this share rose morethan 5.5-fold during the same period),another area of very promising develop-ment is the export of IT services (its valueincreased more than 8.3-fold in 7 years, toUSD 786 827 863 in 2007 (i.e. approx. CZK13.6 billion), almost 88% delivered to Eu-rope, 10% to the USA,in 2008, annual payments to the state peraverage IT employee amounted approxi-mately to CZK 350 000 (approx. EUR 13 230)(in 2002 only CZK 213 000, i.e. approx. EUR8 050), the average wage is CZK 43 703 permonth (i.e. EUR 1 325 EUR),expenditure on ICT equipment and serv-ices was CZK 742 billion (EUR 28 billion) inthe CR in 2007, of which IT services totalledCZK 129 billion (EUR 4.9 billion) and soft-ware CZK 30 billion (EUR 1.13 billion),according to the CzechInvest, every thirdinvestment in the Czech Republic goes tothe IT sector.Free Services for Foreign PartnersIn cooperation with CzechTrade’s officesabroad, the Czech ICT Alliance provides thefollowing free services to foreign partnersand those interested in cooperation withCzech ICT firms:Information services – information aboutthe different aspects of the Czech ICT mar-ket: statistics, as well as data on selectedcompanies.Search for suitable partner/supplier – onthe basis of a specified request from a for-eign partner (technology, number of se-lected specialists, reference), the Czech ICTAlliance selects suitable firms which satisfythe specified criteria.Partnership in pan-European programmessupported by the European Commission– the Czech ICT Alliance is the implemen-tation body for a project of the TechnologyPlatform for IT services, and it has extensiveexperience of subsidised projects. There aretwo options for partnership – either partner-ship with the Alliance in European projects,or assistance in the choice of a suitable part-ner firm for international projects.Preparation and implementation of pres-entations on the particular aspects of theCzech ICT market – based on the speci-fication of requested information theCzech ICT Alliance prepares a presenta-tion which will acquaint prospective for-eign partners with the advantages andpossibilities of cooperation with CzechICT companies.Organisation of trade missions to the CzechRepublic – foreign firms and potentialpartners specify the profiles of companiesor specific companies they would like tomeet in the Czech Republic. The Czech ICTAlliance then approaches these companiesand prepares appointments with them fordirect negotiations. The trade mission tothe CR thus brings maximum benefit.Czech ICT firms want not only to be suppliersto foreign companies, but also to be realpartners and participate in joint projects. Allthese services are available by e-mail frominfo@czechict.cz.Free information services are also providedto foreign analyst companies. The most im-One of the events promoting Czech ICT companies

| 1 6E N T E R P R I S EObjective: To Develop Markets and Work Togetherwww.cdte.czČeská dobývací technika (CDT – Czech Ex-traction and Mining Technology) is an alli-ance of companies which share the inten-tion to uncover new opportunities for theuse of natural resources in certain countriesof the world. Companies which are mem-bers of the alliance are also united by theiridea to expand the areas of trading to loca-tions having a high market and transactionpotential.Search for New MarketsThe key objective pursued by the CDT isto penetrate so far unopened markets inthe countries of Eastern Europe, namelythe alliance wants to create, develop, andmaintain a network of trade relations withcompanies in Russia and the Ukraine whichare engaged in the extraction of raw mate-rials. Thus, the main activity of the allianceis to provide complete services, from pre-contract stages to design documentation,complete deliveries, up to subsequentlong-term servicing.Czech Mining TraditionThe business firms which form the CDT al-liance are renowned, prosperous, and econ-omically advanced companies which carryon the long-time mining tradition in theCzech Republic. They have practical experi-ence of complete deliveries for the miningand preparation of raw materials, whichrange from the design of a mine, the selec-tion and determination of suitable tech-nology, to the preparation of the design ofequipment, organisation of complete pro-duction including assembly and puttinginto operation, up to the funding of the en-tire business case. The sum of their theoreti-cal knowledge, practical competences andknow-how in the area of complete unit de-liveries, engineering technology and indus-try in general enhances their capability tosupply complete design, engineering, andfinancial activities in the area of extractionof raw materials.Support from InstitutionsThe Czech Extraction and Mining Technol-ogy alliance endeavours to bring to theworld market a forward-looking group ofportant partnerships of the recent time arethose with the Gartner Agency and the ITconsulting company Tholons.Czech ICT at ForeignTrade FairsThe Czech ICT Alliance participates withCzech ICT companies in many trade fairsabroad. Czech firms could be seen within of-ficial Czech participations at the CeBIT tradefair, several specialised events of the prestig-ious organiser Gartner (e.g. Gartner IT expo),the Swiss Orbit show, GSM expo, and manyothers. The Czech ICT Alliance is the only re-cipient of subsidies for foreign IT trade fairs,it is preparing subsidised participations inthree exhibitions for the second half of theyear. Plans for 2011 include the CeBIT eventand several other shows where negotiationsare already ongoing.Territorial Interestof Czech ICT FirmsA survey among Czech ICT firms has deter-minedseveralprioritylocationswherethebusi-ness of Czech ICT is successfully developing:Countries of Western EuropeScandinavian countries(Sweden, Finland, Norway)RussiaSwitzerlandUSAThese are priority countries and locationson which Czech ICT firms have agreed.However, individual firms score manyexport successes all over the world. TheCzech ICT Alliance tries to help these aswell.If you are interested in cooperationwith Czech ICT companies, the easiestthing to do is to write to info@czechict.cz, and we will help you to find a suitablepartner.Photo:CzechICTarchives,CDTarchivesExhibition stand of one of the Alliance mem-bers, the 2N Telekomunikace, a.s. companyOne of the projects of the Krušnohorské strojírny Komořany a.s. firm

1 7 |C Z E C H E N G I N E E R I N GMEMBERS OFTHE CDT ALLIANCE:ALTA, s. r. o.Štefánikova 41, 602 00 BrnoPhone: +420 541 550 111E-mail: office@alta.czwww.alta.czBáňské projekty Ostrava, a. s.(Construction of Mines Ostrava)Vítkovická 11, 702 00 OstravaPhone: +420 595 620 031E-mail: bpo@bapro.czwww.bapro.czEnelex, s. r. o.U Stadionu 427, 533 12 ChvaleticePhone: +420 466 988 154E-mail: enelex@enelex.czwww.enelex.czFERRIT, s. r. o.Železniční II 174, 738 01 Frýdek-MístekPhone: +420 558 621 753E-mail: ferrit@ferrit.czwww.ferrit.czHennlich Industrietechnik, s. r. o.Českolipská 9, 412 01 LitoměřicePhone: + 420 416 711 350E-mail: engineering@hennlich.czwww.hennlich.cz/engineeringINCO engineering, s. r. o.Sladkovského nám. 2/312130 00 Praha 3Phone: +420 222 780 372E-mail: inco@iol.czwww.incoengineering.czKrušnohorskéstrojírnyKomořanya.s.Dřínovská 3, 434 01 Most – KomořanyPhone: +420 478 637 611E-mail: ksk-as@ksk-as.czwww.ksk-as.czNoen, a. s.Václavské nám. 802/56, 110 00 Praha 1Phone: +420 224 032 514E-mail: noen@noen.czwww.noen.czOstroj–Hansen+ReindersCo.,s.r.o.Těšínská 66, 746 41 OpavaPhone: +420 553 872 858E-mail: ohr@ohr.czwww.ohr.czT Machinery, a. s.696 02 Ratíškovice 1285Phone: +420 518 391 511E-mail: export@tmachinery.czwww.tmachinery.czUNEX, a.s.Brníčko 1032, 783 93 UničovPhone: +420 585 071 111E-mail: tezke.strojirenstvi@unex.czwww.unex.czVŠB –Technical University of Ostrava17. listopadu 15/2172708 33 Ostrava-PorubaPhone: +420 597 321 111www.vsb.czZEPHYR, s. r. o.Na Pankráci 30, 140 00 Praha 4Phone: + 420 234 633 152E-mail: info@zephyr.czwww.zephyr.czcompanies with solid foundations whichwill become a supporting pillar for the de-veloping mining industries in East Europeancountries. Thanks to support from the Min-istry of Industry and Trade and the Czech-Trade Agency, and to the quality of thefounding companies, the CDT is well poisedto operate actively within its competencesand intentions.Let us have a closer look now at some ofthe members of the alliance, what they do,and what successes they have achieved.ENELEX – Export of ElectronicEquipment to South KoreaEnelex develops special instruments fortechnological measurements in the energysector. When information appeared aboutits successful application of thermovisioncameras at a coal stockpile in the Czech Re-public, a specialised firm from South Koreaexpressed interest in this solution. Becauseof the climatic conditions and the coal usu-ally supplied, problems with self-ignitionand combustion of outdoor coal piles inSouth Korea are quite big.Workers of the Korean partner visited theEnelex company several times and after dis-cussing technical details proposed a pilottechnical solution for the project of the Dan-gjin unit № 7&8, which was put into opera-tion in the presence of Czech specialists in2007. The project consisted of deliveries ofCzech equipment and software.As time went by, Enelex’s systems of coalpile monitoring were installed at three otherpower plants in South Korea, and in 2009 thesecond system was installed at the Dangjinpile unit № 1-4 as an extension of the orig-inal system, which is perhaps the best proofof the end-customer’s satisfaction.In 2008, the volume of the export toSouth Korea made up approximately 50% ofEnelex’s turnover.Hennlich Industrietechnik, s. r. o.– Made the Longest Energy Chainin the WorldThe longest flexible energy supply in theworld has been manufactured by the Czechfirm Hennlich Industrietechnik, which is partof the Hennlich group. Its design for theTušimice brown-coal fuelled power plantwon the main prize, the Vector Award, at theinternational industrial trade fair in Hanover,Germany. The application of flexible energysupply to the coal pile was awarded themain prize among 110 designs entered from23 countries.The prize-winning design is the longestapplication of energy chains in the world.The equipment, using energy chains of theigus brand, brings the necessary energy tothe stacker/reclaimer machines which sup-ply brown coal to the power plant. The totallength of the energy supply line exceeds600 metres, which breaks the former lengthrecord from the port of Singapore by morethan 100 metres. An interesting technicalfeature is that this solution makes it possibleto connect each stacker/reclaimer to anytype of energy supply.Krušnohorské strojírnyKomořany a.s. – Experienceof More than 60 YearsKSK is a company operating in the area ofmachinery and equipment for opencastmining for 60 years. A major project is itsgeneral overhaul, by stages, of the wheelexcavator KU 800.11/K84, a key part in theoverburden removal technology at thequarry in Vršany, North Bohemia.The company’s basic activities are:development and construction of ma-chines, machinery systems and parts,production, repairs, assembly, and servic-ing of machines, machinery systems andparts, and steel structures,Conveyor unit of coal excavator - Hennlich Industrietechnik, s.r.o.

| 1 8E N T E R P R I S ESANS SOUCI in Dubaidevelopment, production, assembly,and servicing of brown coal boilers,metal working.Noen, a.s. – Cooperationwith GiantsNoen, a.s. employs a team of 90 top-rank-ing designers who carry out all design andconstruction work on state-of-the-art tech-nology. The company’s main activity is thedesign and engineering preparation of ma-chinery and equipment for opencast min-ing of minerals, transport equipment, bulkhandling machines and equipment, andsupplies of stockyard equipment. In the areaof design for foreign customers it is focusedon design documentation, including calcu-lations as well as detailed designs of com-plete machines and their subsctructures inthe sector.On the domestic market, the companyprepares studies and designs of new wheelexcavators, reconstruction and modernis-ation of conveyor systems and machines forbulk handling.During its operation, NOEN a.s. has be-come the main partner of Severočeské doly,a.s. Other important coal mining companieswith which it cooperates include Mosteckáuhelná společnost a.s. and Sokolovská uhel-ná a.s. In 2005, it won a framework agree-ment to perform Due Diligence on miningequipment for the Czech energy companyČEZ in all its future foreign acquisitions. Oneof the main projects of the present time iscoal feeding at the Ledvice power plant.Another important contract is e.g. for coalfeeding at the Tušimice power station.T Machinery a.s.– Success in the UkraineT Machinery a.s. is a manufacturer of top-class mining equipment. Its productionprogramme includes shearers, mechanicallypowered supports, underface equipment,face scraper conveyors, power switchingsets, and mining locomotives. In 2009, thecompany scored great success in the Ukrain-ian market with new types of its equipment.The DTEK Concern, leader in coal mining inthe Ukraine, has started the process of exten-sive renewal at its mines.T Machinery a.s. andDTEK have cooperated since 2005, when thefirst shearer of the MB series was supplied tothe Komsomolets Donbassa mine. Followingthis cooperation, and owing to the excellentperformance of MB shearers, T Machinerya.s. has become a supplier of shearers, facescraper conveyors, and power sets also toother mines of the DTEK concern. For exam-ple, at the Pavlogradskaya Mine, two milliontonnes of coal were extracted in 2009 with anentirely new type of the bridge-type shearerMB 444 P for low seams from 0.88 to 1.3 m.The new type of the MB 410 E shearer,designed for low seams of 0.9 to 1.8 mthickness, has performed very well at theKrasnoarmeyskaya-ZapadnayaoftheDonet-skstal concern, with which T Machinery a.s.cooperates since 1998. More than 5 milliontonnes of coal were extracted at this minein 2009.The development of new types of equip-ment is a natural priority for T Machinery a.s..Výstavba dolů Ostrava, s.r.o.– Mining in the JungleVýstavbadolůOstrava,s.r.o.(VDO-Construc-tion of Mines Ostrava, Ltd.) has been con-ducting mining operations at the Merit-Pilacoal deposit in central Sarawak, a Malaysianpart of the island of Borneo, for 16 years. Ap-proximately 600 000 tonnes of quality coalfor energy production are extracted thereannually in the open-pit operation with theuse of wheel machinery. The VDO providestechnical services for the deposit owner, en-sures planning, manages extraction in thedifferent quarries, supervises the local sup-ply companies which carry out the miningwork, and coordinates recultivation workso that the environmental impacts on thetropical forest are minimised. Constructionof Mines Ostrava is a part of Báňské projektyOstrava, a.s.Sans Souci Czech Glass Alliance is one ofthe youngest groupings established un-der the aegis of the CzechTrade Agency, itwas established in 2009. The initiator, andat the same time leader of the Alliance,is the San Souci Company, around whichfirms operating in the glass industry areassociated. They include not only glass-making firms but also others which areinvolved in the final products. As the com-panies are relatively small and specialised,and have numerous experts, they workclosely together in the fulfilment of largeorders and projects, especially for foreigncustomers. One of many is the project ofPhoto:Firms’archivesOriginal modern glass railingA machine of the T Machinery a.s. firmBlanka Bartošová, Sans Souci Czech Glass Alliance, e-mail: blanka.bartosova@sanssouciint.com, www.sanssouciint.com

1 9 |C Z E C H E N G I N E E R I N GLighting FixturesAlthough the entrance hall of the villa isquite a light space, the designer includedin the concept ceiling lights, which are alsoin harmony with the relatively simple andpure style of the whole interior. Lead crystalglass, combined with stainless metal parts, isa composition of high luxury and yet unob-trusive. Everything has been made in coop-eration by Sans Souci, Cristal&Cristal and J.H.KOV and J.H. LAK.Applied ArtWhat other category to use for the artisti-cally rendered entrance gate, which wasdesigned and executed by art blacksmithRadek Bárta? Lens-shaped glass pieces areset in the metal leaves and all is producedin such a way that the gate resists the localclimatic conditions without change.Other SuccessesSuccessful projects executed by Sans Soucior members of the Alliance include not onlyprivate villas and yachts, but also hotels, roy-al palaces and theatres, such as the HiltonPrague Hotel, the Connaught London, orthe 4 Points Sheraton Hong Kong, as well asprivate clients from Europe, the Near and FarEast, Russia, and Western Europe.a private villa in the Yassila area of Dubai,the UAE.The first order for the Yassila Dubai projectwas won by the Sans Souci office in Dubai,which provided commercial backing for theproject throughout the time and led it tosuccessful completion. It involved a privateresidence which was completed in 2009.Thanks to the wide range of activities inthe area of interior glass, accessories, andto cooperation with specialised firms andrenowned artists, the house was furnishedwith lighting fixtures, glass tiles, mosaics,stained glass, and applied art glass. Everysupplied piece is an original and was madeto the customer’s requirements.The Alliance partners contributed to theproduction of the parts each to a largeror lesser extent, and the success was alsodue to artists who are not members of theAlliance.Mosaic and Glass Tiling MaterialsOriginally the design for the swimming poolin the garden was very simple and in severalcolours. However, Pavel Baxa (Český šperka design) proposed unusual details whichbrighten up the pool area and connect thespace inside and outside of it.The material used was Sans Souci splitglass mosaic with galvanised metal coating,the glass statue by the pool side is madefrom blown glass components. In the inte-rior of the house, a unique tiling material,Bubbles, has been used, which works withreflections of light in numerous little glassballs of various sizes.Railings and StainedGlass WindowsThe concept of the railings and windowswas again prepared by the designer PavelBaxa, taking account of the rather modernconcept of the interior. The minimalist ren-dering gives prominence to the fused glasswith moderate colour accents. All metalparts originated in the companies J.H. KOVand J.H. LAK.SANS SOUCI CZECH GLASSALLIANCE ASSOCIATES FIVECOMPANIES AND DESIGNERS:Sans Souci: www.sanssouciint.comJ. H. LAKJ. H. KOVČeský šperk a designLudmila StodolováDetail of the villa’s entrance gateGlass tiling and decoration in the pool areaBubbles glass tiling

TOSHULIN, a.s., Wolkerova 845, 768 24 Hulín, Czech RepublicPhone: +420 573 327 111, Fax: +420 573 350 321, www.toshulin.cz, E-mail: sales@toshulin.czTOSHULIN, a.s. started operations in 1949, when the foundation stone was laid in Hulín for a new engineeringworks. Since then, the company has undergone a long development in engineering production. Today, the com-pany makes high-quality precision and reliable vertical turning lathes and vertical turning centres, which rank itamong the world’s leading manufacturers of this kind of machine tools.The company’s core programme is the manufacture of REV, SKL, SKA, POWERTURN, POWERTURN Y,SKG, SKAT, SKIQ and recently SKY vertical machining centres.The lathes come in types with table diameters ranging from 800 mm to 5000 mm and are fitted with top-standardelectronic elements, which, together with the traditionally high-precision mechanical parts, are a guarantee of highoutput, reliability, and precision of machining. All these types of machines are intended for work in demandingand complicated industrial applications and are adjusted to the individual requirements of customers.The different series of machines produced by TOSHULIN vary in their tool exchange systems, the cross sectionof the slide ram and the general design of the machines.Other important activities of the firm, in addition to the manufacture of new machines, include the modernisationand overhaul of machine tools.TRADITION – PRECISION – RELIABILITYSTARTED 1949

2 1 |E D U C AT I O NStudy of Technical Branches Is not Just a TrendIvan Čapek, Director, the Association of Engineering Technology, e-mail: capek@sst.cz, www.stt.czLatest statistics prove that reports about thestate of technical education in the Czech Re-public are becoming more favourable aftera long time – that more students have ap-plied for admission to technical schools ina year-on-year comparison. However, let usnot be prematurely optimistic, although thenotion of a light blinking at the end of thetunnel is more than enticing. On the otherhand, the statistics are certainly not acciden-tal, but reflect certain positive steps on thepart of large industrial firms, and somewhereeven regional authorities, to support interestin technical schools.Prediction of EULabour Market NeedsThe lower interest in technical educationis by far not merely a Czech problem. At itsrecent session, the European Economic andSocial Committee in Brussels has endorsedthe document New Skills for New Jobs. Theopinion makes it clear that it is in Europe’s in-terest to build up capacity and mechanismsfor forecasting skills vis-à-vis the needs ofthe labour market at national and EuropeanUnion level. Specifically this means improve-ment in research methods and databasesand concurrent updating of supply and de-mand forecasts.Association of EngineeringTechnology and Its MembershipThis assessment of the present situation intechnical education is based on the experi-ences and declares needs of a relatively largesample of engineering companies. Over fortyof the most important ones in the branch ofmachine tools and forming machines aregrouped in the Association of EngineeringTechnology. It is a special-interest organisa-tion whose objectives include maintainingthe excellent reputation of Czech machinesat home and in foreign markets.This is hardlyimaginable without an inflow of young staff.In this respect, good results have been pro-duced by cooperation of manufacturers withregional schools and training centres, as wellas promotional programmes with good mar-keting strategies aimed at stimulating stu-dents‘ interest in the machine tool and form-ing branches. An excellent response is drawnfor example by competitions of future opera-tors of CNC machines among several Czechsecondary schools that the Association of En-gineering Technology has organised on theoccasion of the International Engineering Fairin Brno for the second time this year.Young Blood Neededin Machining and FormingThe branch of machine tools and formingmachines in the Czech Republic has natu-

| 2 2E D U C AT I O Nrally suffered from the insufficient inflow ofyoung blood for quite some time as well,although it has been one of the few engi-neering sectors in the country that haverecorded considerable growth in the pastyears. Czech firms as a whole rank amongthe seven largest manufacturers in Europe.At the same time, as soon as conditionswere created within the changes in society,the companies succeeded in the re-orienta-tion of export to the technically advancedcountries ofWestern Europe. Sales increasedas well to the so-called growth-economies,where we rank China, India, and Russia.The machinery is normally equipped withstate-of-the-art electronics, also for possi-ble unmanned operation. Currently mademachine tools thus follow the many years‘tradition of highly valued products whosetechnical parameters are fully on the Euro-pean level.Contacts with ProductionIt is generally believed that schools whichsuccessfully attract students are prima-rily those which closely cooperate withleading engineering enterprises in theirregions, enable students to have directcontacts with the production process,and the best of them even have the op-portunity to participate in the solution ofspecific technical tasks. Good examples inthis can be the following companies: TOSVARNSDORF, a.s. in Varnsdorf, ŽĎAS, a.s. inŽďár nad Sázavou, and KOVOSVIT MAS, a.s.in Sezimovo Ústí, which have successfulcooperation with local technical voca-tional schools.Clear State Concept Is EssentialIt is certain that the conditions for a shiftin the professional bias of young peoplein favour of technical branches will notchange unless the task is undertaken alsoby state bodies, at least as coordinators.They have neglected the issues of de-velopment of technical education in theCzech Republic for many years. Hopefully,a really quality, objective, and feasibleeconomic concept of the state will soonbe prepared and will clearly show that en-gineering is one of the sectors on whichthe Czech economy rests. The currenttasks for the relevant state institutions ofall levels include the establishment of co-operation between the production sphereand the various parts of the Czech educa-tional system and consequent backing forit, an active participation in the organisa-tion of purposeful campaigns to empha-sise the attractiveness of various technicalbranches, and improved information ofstudents about the possibility of stud-ies and jobs, tasks the urgency of whichis sufficiently illustrated by the presentgloomy situation.Photo:STTarchivesPunching UnitsPunching UnitsTruPunch 5000Main characteristics:Extra-high speedRapid sequence of strokes – theworld’squickestpunchingmachineRotation: radical increase inrotation speedRapid shapingRapid tool exchangeSuction: efficient and reliableKOVOSREAL s.r.o.závod Duchcov Mostecká 1487419 22 Duchcov, Czech RepublicE-mail: kovosreal@kovosreal.czTrade department:Phone: +420 417 835 111Fax: +420 417 835 156www.kovosreal.czaccredited with ISO 9001 and ISO 14000quality management systemsControlling GaugesControlling GaugesTruBend 5170Length of tool strip: 4080 mmACB (Automatically ControlledBending)Short idle time facilitated by therapid tool exchange systemExtremely large freespace for bendsIntelligent 6-axle end stopQuality and safety of laserhardened TRUMPF toolsKOVOSREALKOVOSREAL s.r.o.s.r.o.traditional manufacturertraditional manufacturerof metal furniture and metalof metal furniture and metaltool containerstool containersCompetition of young mechanical engineers in CNC machine tool programming, organised bythe Association of Engineering Technology at the Brno International Engineering Fair in 2009

■ Printing● Roller coverings● Printing chemicals● Printing blanketsMain supplier of rubber rollers for printing machines of thebrands: HEIDELBERG, MAN-ROLAND, ADAST,KBA-PLANETA, KBA-GRAFITEC, WIFAG, GOSS, KOMORI,RYOBI■ Sleeves■ Escalator handrails■ Rubber coverings for industrial rollers■ Polyurethane application on the roller■ Use of technical rollers:wrapping production, textile industry, steel industry, paperindustry, tanning industry, plastic materials industry, furnitureindustry, chemical industry, food industry, electricalengineering, glass industry, mechanical engineeringBöttcher ČR, k.s., Tovární 6, 682 01 Vyškov, Czech Republic, Phone: +420 517 326 521-5, Fax: +420 517 341 718e-mail: bottcher@bottcher.cz, www.bottcher.cz

| 2 4R E S E A R C H A N D D E V E LO P M E N TTen Years of Machine ToolResearch in PragueProf. Jaromír Houša, Head of the Research Centre of Manufacturing Technology,Czech Technical University in Prague, Faculty of Mechanical Engineering,e-mail: j.housa@rcmt.cvut.cz, www.rcmt.cvut.czA research facility, founded for the machinetoolandformingmachineindustryandfortheCzech engineering sector generally, is used bythe industry in the innovation of products.This facility is the Research Centre of Manu-facturing Technology, which marks 10 yearsof its existence this year – it was establishedin 2000 and has been built with the supportof the Czech Republic’s Ministry of Education,Youth, and Sport. Its main purpose was to setup a research base which had not existed inthe country.The project, called“The Centre forManufacturing Technology“, was successfullycompleted in 2004. It is a well-equipped andstaffed research and development institutionat the Czech Technical University in Prague,with two external laboratories (at the Tech-nical Universities in Brno and Liberec). An ac-credited testing laboratory has been estab-lished as well, equipped with state-of-the artmeasuring equipment for measurements ofall important qualities of machine tools.Active Research CentreThe Centre has been very active. During thisfirst period, it issued 258 research reports andpresented partial results in 385 publications.Researchers of the Centre have been grantedthree utility models. The Centre has also builtan accredited testing laboratory. When theprojectendedin2004,theCentrewasgranteda statesubsidyforanothersevenyears’period,for a project called “Research into Manufac-turing Technology“. It consists of 3 categoriesof subjects where research is divided into 13themes.The three categories are:Research into highly productive, accurate,reliable, and ecological machine tools andtheir componentsResearch into the properties of machinetools, their monitoring, and machineintelligenceResearch into advanced, high-perform-ance, and ecological production machines(especially machine tools).More NewsIn this project, which is extended until 2011,the Centre is also committed to educatedoctoral students. As an innovation, theCentre must acquire 10% of allowable costsof the project solution from the commercialsphere through its own activities. A facility inPlzeň has been added to the external labo-ratories, and research has been expanded aswell, namely to forming machines. A majorachievementoftheCentrewasthesolutionoftwo European projects within the 6th Frame-work Programme – called Ecofit and HardPre-cision. The Centre cooperated in these e.g.with TU Stuttgart, IPT Aachen, the Dutch firmHemtech, with the Spanish research instituteFatronik and with other partners. Cooperationis also developing well with UWE Bristol.The results of this period in the Centre’soperation include 430 publications, 281research reports, 275 tasks for industry, 96outputs (prototypes of software and testedtechnology), 2 Czech, 1 European, and 1 Ger-man patent, 11 utility models, 12 courses or-ganised for staff in industry, 1 internationalconference, 17 defended doctoral theses,and 1 habilitation thesis.Cooperation with IndustryThe interest of industry in cooperation withthe Centre has been permanently growing,compared with 2004 it is at six times thatlevel this year.The reason is that, from the be-ginning, the research programme has beenprepared in cooperation with industry andin harmony with the global developmenttrends in the sector. The correctly focusedresearch has thus enabled the workers toacquire knowledge and competences whichare relevant for industry, and they now coop-erate especially in the innovation of products,regardless of the economic recession. Since2004, the Centre has cooperated with indus-trial enterprises on 15 projects supported bythe Ministry of Industry and Trade, and is cur-rently cooperating on another eight.An important activity of the Centre in thelast two years has been cooperation with theAssociation of EngineeringTechnology in theestablishment of theTechnology Platform formachine production and in its own activities.A Strategy for the Sector of Machine Toolsand Forming Machines for the Years 2010 to2020 has been undertaken for this platformin cooperation with 64 experts from indus-try and with the platform’s Executive Com-mittee. This year, the Centre will prepare its“Implementation Action Plan“, which is basi-cally a detailed research plan in the branch ofmachine tools and forming machines in theCzech Republic for the years 2012 to 2015.Working for Competitive IndustryThe establishment and activities of the Re-search Centre of Manufacturing Technol-Photo:www.sxc.hu,EXPRESS-INTERFRACHTmezinárodníspediceCZs.r.o.archives

2 5 |C Z E C H E N G I N E E R I N Gogy has brought considerable benefit forthe participants in the project, which meansuniversities and the machine tool and form-ing machine industry in the Czech Repub-lic. The establishment and activities of theCentre have enabled university laboratoriesto enhance the volume and quality of theirresearch activities, and thus help to increasethe prestige of universities.The transfer of thelatest research findings to study programmeshas brought their considerable improve-ment, increasing the attractiveness, efficien-cy, and quality of doctoral study. The Centrehas created a base for research and supportfor the development of new technology so-lutions in manufacturing companies withoutwhich there would be no chance to sustaintheir position among the most successfulmanufacturers of machine tools in Europeand worldwide. Its beneficial role is also in itssuccessful acquisition of new technical talentand in the education of a new generation oftop specialists. The applications of the out-come of research into new technology solu-tions in the area of machine tools, which orig-inate in the Centre, are a basic prerequisite forthe competitiveness of Czech products.Poll of Successful Companies Operating in the Areaof Engineering and Related BranchesMíčkova 64, 614 00 BrnoPhone: +420 548 426 411E-mail: express@express-interfracht.czwww.express-interfracht.czTurnover: EUR 28 494 000Number of employees: 28Export: to CIS states, the Ukraine, Balkanstates, the USAAs an international freight forwarder, the com-pany concerns itself with the transport of dif-ferentkindsofgoods–frombulkcargoes,suchas timber and scrap iron, to whole plant andextra-large items. We deliver these cargoes byrail, road, water, air and their combination, andfind the optimum transport route every time.Besides the actual transport of the goods, wealso secure all related transport services – cus-toms services, insurance of consignments,packing, loading and unloading, tracing andtracking the goods, complaints proceedingsand price and tariff consulting. Together withthe parent company based inVienna, this firmis part of Austria’s strong Rail Cargo Austriaholding, with affiliations all over Europe.What is the secret of your successfulweathering of the global financial crisis?Our work depends on orders for transportwe get from our permanent customers, withwhom we rise and fall. Our only opportu-nities are the new acquisitions by our man-agers, who obtain contacts to new clients,and new projects, with new transport deals.Can you describe one of your mostimportant recent orders?This year we arranged the transport of 100TATRA lorries to Azerbaijan. Because of thelarge number of lorries and the demandingnature of the transport all along the route,the consignment had to be divided up andloaded on to two entire trains. This requireda sufficient number of special low-platformwagons with wheel spacing suiting this coun-try’s track gauge and, after re-loading, thebroad-gauged CIS tracks. Both these trainswere under the continuous supervision of ouremployees and, after leaving EU territory, theywere placed in the care of private securityguards, who accompanied the consignmentup to the destination station, where it washanded over to the recipient.The whole oper-ation was carried out smoothly, without anycomplications, attested to not only by its shortduration – taking only three weeks – but alsomainly by the satisfaction of our customer.TOP FIRMS IN CZECH ENGINEERINGName Based in Sector ContactČKD Blansko Holding, a.s. Blansko water turbines and hydrotechnological equipment, lathes, machinery works www.ckdblansko.czKRÁLOVOPOLSKÁ, a.s. Brno enineering equipment, cranes, and lifting equipment www.kralovopolska.czProkop Invest, a.s. Pardubice whole plants, reconstruction of techological nodes, single machines www.prokop.czROTTER,s.r.o. Vír manufacture of parts for the engineering industry www.rotter.czSE-MI service a. s. Ostrava mining equipment www.se-mi.czStrojferr, s.r.o. Frýdek-Místek mining machines and equipment www.strojferr.czStrojírny Poldi, a.s. Kladno farm machinery crankshafts, building machines www.strojpoldi.czŠkoda Machine Tool, s.r.o. Plzeň heavy-duty milling and boring machines, heavy-duty lathes www.cz-smt.czT M T spol. s r. o. Chrudim Chrudim equipment for technological and inter-operational transport www.tmt.czTajmac - ZPS, a.s. Zlín vertical and horizontal machining centres, CNC lathes, etc. www.tajmac-zps.czEXPRESS-INTERFRACHTmezinárodní spedice CZ s.r.o.

| 2 6S U R V E YNOEN, a.s.Václavské náměstí 802/56, 110 00 Praha 1Phone: +420 224 032 510E-mail: noen@noen.cz, www.noen.czTurnover: year 2008 - EUR 39 million, year2009 - EUR 25 millionNumber of employees: year 2010 - 100Export: Documentation for VAMH/SANDVIK,final customers in China, Iran, Bulgaria, UK,Australia, South AfricaNOEN, Inc. was established in 1997. Thereare 90 highly educated and qualified ex-perts with long-term experience workingfor NOEN. They use up-to-date hardwareand software when preparing analyses,projects, and expertises. They also super-vise operations of bucket wheel excavators,conveyor systems, tripper cars, spreadersand coal handling equipment. In case ofmining equipment modernisation, theytake care about reliability and life cycleimprovement.The scope of NOEN turn-key entrepre-neurial abilities comprises lay-out design,basic design, static and fatigue (FEM) cal-culations, detail design, and supervisionof outsourced services during productionand erection phase. NOEN focuses on newbucket wheel excavators designing, beltconveyor modernisation, and coal handlingequipment designing. There are four NOENsubsidiaries located in Prague, Uničov, Chru-dim, and Bílina.What can your company offer foreigncustomers?The NOEN’s core business is turn-key man-agement and project design in the follow-ing areas:Open-cast mining equipmentLong-distance and technological trans-port of loose materialsMaterial handling equipmentStock-yard (coal handling) equipmentWithin areas of the core business mentionedabove NOEN offers:Lay-out design, basic design, static and fa-tigue (FEM) calculations, detail designExpertise, consulting, and technicalassistanceTurn-key management, supervision ofoutsourced services during productionand erection phase.What is your firm especially proud of,which recent project do you value most?One of the most important projects is thecomplete documentation of the KK 1300bucket wheel excavator – new NOEN de-sign of the TC2 series.NOEN is one of six firms worldwide withthe specific expertise to be able to makecomplete documentation for such kind ofprojects.KOVOSVIT MAS, a.s.Náměstí Tomáše Bati 41991 02 Sezimovo ÚstíPhone: +420 381 63 1111www.kovosvit.czwww.kovosvit.comTurnover: EUR 26 millionNumber of employees: 560KOVOSVIT MAS is a traditional Czechmanufacturer of modern metal-workingcentres and CNC lathes with a history ofnoteworthy development and a strongtechnical background. The company hasa seventy years’ tradition in the manufac-ture and development of machine toolsand boasts a number of awards for its tech-nical contribution to the development ofmachine tools in the Czech Republic. Itsproduction is oriented mainly towardssubcontractors for the car-making, power-generating, aircraft, and engineering in-dustries. KOVOSVIT MAS offers its clientscomprehensive services, individual solu-tions, flexibility, and above all products ofthe highest quality with correspondingservicing. MAS started the manufacture ofmachine tools as far back as 1939, and inthe course of years it has developed andsuccessfully placed on the market a largenumber of machine tool types. Its drillingand milling machines include types suchas VKW 100, MCV 32, and MCV 1000 HSC,the development of which has resulted inthe manufacture of one of the most ad-vanced machines, MCU 63OV – 5X for con-tinuous five-axle machining. In the area oflathes and turning machines, KOVOSVIThas a very strong technical background,with a range of machines including, forexample, the R5 revolver lathe, the SPT 16semi-automatic lathe, and patented de-sign of the MCSY 80 machine.The company’s current production isdrawing on its long experience of machinetool production and construction and isa guarantee of reliability for its clients.Could you mention some of the recentachievements of your company which youvalue most?KOVOSVIT MAS, a.s. participates regularly incompetitions at trade fairs and exhibitionsand it has won all sorts of prizes, gold med-als, and awards for design. The last time itwon a prize at the 2010 International Engi-neering Fair in Nitra, Slovakia, for its MMC1500 vertical portal centre.Can you give a brief description of yourco-operation with Czech technicaluniversities? What are the practicalresults of this co-operation?The company co-operates with leadingCzech universities, e.g. the Technical Uni-versities in Prague, Brno, and Plzeň, and theVCSVTT research centre. It also co-operateswith the Ministry of Industry and Trade inthe framework of subsidy projects. Basically,the co-operation concerns the constructionand development of new machine tools.Photo:Firms’archives