Deployment in the Czech Republic and Slovakia as Stepping Stone to the EU

By Liu Chia-yu

The afternoon session of the Global Networking Forum on "Based in Taiwan, Linking with the International Community and Positioning for the World" was dedicated to the market opportunities and investment climate in the Czech Republic, Slovakia and the EU. Speaking at the opening of the afternoon session, TEEMA Managing Director Warren Chen said that the aim of the association's event was to equip Taiwanese manufacturers with the latest information and best practices from the viewpoints of foreign governments and enterprises, which could serve as a reference for them to maneuver themselves into position in the local markets, and that as Taiwan's ICT industry is highly competitive, companies should take a new approach to their operations in order to create a better future in 2021, given the rapidly changing global business environment.

Taiwanese Companies Set up a Presence in the Czech Republic to Enter the Western European Market

As a member of the EU, the Czech Republic is in the front rank of Central European countries in terms of education level. The country's five main export industries are automotive, machinery, chemicals,food processing and metallurgy, with the automotive sector being the leading one in Central and Eastern Europe.
At the forum session centered on the Czech market, Representative of Taipei Economic and Cultural Office in Prague Liang-Ruey Ke noted that sitting at the heart of Central and Eastern Europe, the Czech Republic provides a springboard to gain access to countries such as Austria and Germany. With a healthy business environment, industrial infrastructure and a highly educated population, it has become Taiwan's fourth-largest investment destination in the EU, and many TEEMA members have already set up operations in this market.
Taiwan's trade ties with the Czech Republic are strong and close, Czech Economic and Cultural Office Representative Patrick Rumlar said, adding that a delegation led by Czech Senate President Miloš Vystr il met with TEEMA during a visit to Taiwan in September 2020 and he would like to extend an invitation to TEEMA to visit the Eastern European country the next year after the pandemic has subsided for closer cooperation between the two sides.
Jan Proks, Director of the Electrical and Electronic Association of the Czech Republic, said that in order to create a win-win situation in trade between the Czech Republic and Taiwan, the two countries must not only rely on good products and timing, but also on mutual understanding of each other's culture,trust and even the shared values. "During the 15 years since the signing of the MOU between the Electrical and Electronic Association of the Czech Republic and TEEMA, we have conducted many visits and cooperated on multiple projects. We hope that in the coming years the two organizations will work more closely together to promote trade activities between the Czech Republic and Taiwan," he added.
Chairman of the Czech Taiwanese Business Chamber Pavel Divis stated that the chamber is an independent body that initially acted as a bridge between the Czech and Taiwanese governments,and in recent years has opened up membership to private enterprises. Over the past few years, changes in the global supply chain have prompted them to expand business exchanges, economic and trade cooperation between the two sides. A member of the EU, the Czech Republic ranked seventh in terms of economic soundness in 2020. With its central location,convenient transport links and access to 20 different markets, it is a prime location for Taiwanese usinesses to invest.
The strength of Taiwan's information and communications technology (ICT) industry is plain for all to see, said Industrial Technology Research Institute (ITRI) Industry, Science & Technology International Strategy Center (ISTI) Deputy Director Ma-Tien Yang. Combining it with the medical services in the midst of the COVID-19 outbreak could mitigate the impact of the disease in the post-pandemic era and create significant business opportunities at the same time. Besides, the Czech Republic is ideally located to gain access to the EU market.
The Czech economy has been in good shape in recent years and the country has a large and talented labor pool, which has created an environment that is favorable for investment, said Eric Lin, General Manager of Wistron InfoComm Czech, adding that as an EU member, the country is centrally located in Europe, so it is convenient for inter-country trade and transportation, making it a good choice for setting up a supply chain and production base.

Considerable Benefits of Entering the Slovakian Market with Agreement for the Avoidence of Double Taxation

In the heart of Central and Eastern Europe,Slovakia is considered to be one of the most important gateways to Eastern Europe. Following the European debt crisis, the country's economic growth from 2017 to 2019 rose 3.2%, 4.1% and 2.3% respectively,which was driven by exports and domestic market demand, with major exports including automobiles/motorcycles, television receivers, automobile/motorcycle parts and accessories, telephone and mobile phone components, and tires.
At the forum session revolving around Slovakia,Representative of Taipei Representative office in Bratislava David Lee said that being a member of the EU and using the euro as its currency, Slovakia boasts excellent trade facilitation and a favorable business environment, which eliminates the exchange rate issue that is a major concern for companies. In view of the increasing willingness of Taiwanese companies to invest in Slovakia, the country has signed agreements with Taiwan to avoid double taxation and to exchange driving licenses, thus securing many favorable conditions for Taiwanese businesses, making it one of the countries with the best access to the European market.
Slovak Economic and Cultural Office in Taipei Representative Martin Podstavek noted that Slovakia adopts the euro and is part of the Schengen Area,which makes it easier for Taiwanese companies to do business here, check out the investment climate, and apply for investment funds offered by the EU. "Slovakia is very similar to Taiwan, with a highly educated population and excellent technological capabilities,and if combined with investments from Taiwanese enterprises, it can make a good stepping stone to the EU market," he added.
Slovakia is very friendly to foreign investors, with many Taiwanese companies based in the country as well as other international corporations such as Samsung and KIA. Crucial to this is that Slovakia is among the top countries in the EU in terms of political stability and macroeconomy, and together with a solid foundation in the automotive industry, we hope to have more diversified cooperation with Taiwan's high-tech industries, said Dominik Susa, Deputy CEO & Head of the Investment Projects Department of the Slovak Investment and Trade Development Agency (SARIO).
Representative of Delta Electronics Inc Juraj Buday said that Delta first gained access to Slovakia through the acquisition of Eltek and now has three production sites in Europe, two of which are in Slovakia. With respect to location and quality of employees, the products made in Slovakia put Delta in a very competitive position in the EU, and therefore it would continue to step up its investments in the local market.

Best Choice for Taiwanese Investment as Taiwan-Europe Trade Partnership is Getting Closer

The EU currently has 27 member states, the main currency is the euro, and there are 24 official languages. With a GDP of up to US$18.29 trillion in 2019, it is the world's second largest economic entity, and the EU market attracts many international companies to set up and invest in it. Bilateral trade between Taiwan and the EU reached 50.5 billion euros in 2019.
Deputy Head of the European Economic and Trade Office Thomas Jürgensen said that Taiwan is the 15th largest trading partner of the EU and the 5th in Asia, while the EU is the 4th largest trading partner of Taiwan, with total bilateral trade volume growing by nearly 10%. The EU plays a pivotal role in the global economic market and looks forward to diversifying its cooperation with Taiwan with a view to creating a complementary and win-win situation.
ITRI Senior Consultant Liang-Han Hsieh said that from ITRI's involvement in the EU-promoted electric vehicle project in the past, it is clear that Taiwan is seen as a partner that can supply critical technological components to the EU. Taiwan's ICT capabilities are well recognized worldwide. With the advent of the 5G era, a close collaboration between the two sides in the area of smart network will help raise the awareness and market share of Taiwanese brands in the European market.
Chin-An Wang, Business Director of the Commercialization and Industry Service Center (CIS) of ITRI said, "The EU is the largest investor in Taiwan, accounting for more than 25% of foreign direct investment (FDI) in Taiwan, amounting to approximately US$45 billion, and the EU has a good track record in the automotive industry, precision machinery industry, aviation industry, electric vehicle industry, energy industry, as well as 5G and AI, etc.
Taiwanese companies can commit funds to the market by focusing on the foregoing sectors first." Joseph Lin, President of TEEMA, mentioned that either the Czech Republic, Slovakia or the EU are very important export markets for Taiwan, and many Taiwanese companies have set up production bases or operational bases in these regions. With the restructuring of the global supply chain, TEEMA will continue to assist Taiwanese companies with their global presence through multiple channels, while gaining a competitive edge in the post-pandemic era.
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