Relationship assists both nation's growth

The fact that the Czech Republic has finished industrialization and China is in the middle of the process creates huge potential for cooperation between the two countries as their economies have complementary advantages.

The Czech Republic is now China's second-largest trading partner after Poland among the 16 Central and Eastern European countries, and China has replaced Poland to become the third-largest trading partner of the Czech Republic globally.

Outside of the European Union, China is the most important trading partner of the Central European country. In 2015, bilateral trade between the two countries hit $11 billion, according to China's statistics.

China-Czech cooperation has developed rapidly in terms of investment, finance and tourism.

By the end of last year, Chinese investment in the Czech Republic reached about $1.6 billion and the Czech Republic had invested over $1.8 billion in China.

In 2015, Xi'an Shaangu Power, an engineering company in Northwest China's Shaanxi province, purchased EKOL, a leading turbine manufacturer in the Czech Republic, at a cost of 1.34 billion krona ($55.6 million). It was the biggest investment by China into Czech Republic's manufacturing industry in recent years.

CEFC China Energy Co Ltd increased its stake in the Czech-Slovak investment group J&T Finance last year. The Chinese company also acquired several Czech companies covering the beer, tourism and aviation industries, and became a partner of the Czech national football team.

Acquisitions by CEFC China have injected enormous sums of money into the Czech market and boosted local market transactions.

Other Chinese companies with businesses in the Czech Republic include financial institutions, airlines and smart device manufacturers.

Bank of China set up a branch in the Central European country and China UnionPay has promoted its bank card business there. Hainan Airlines launched a direct route between Beijing and Prague last year, and Huawei, ZTE and Coolpad have been active in the local telecommunications markets. Consumer electronics giant Changhong and YAPP Automotive Parts increased their investments in the Czech Republic, and some Chinese companies have invested in local auto parts companies.

Many Czech companies have expanded their exports to and investments in China.

Home Credit China, for example, a subsidiary of Czech-based PPF Group, now provides financial services in 24 provinces and has 33,000 employees in the country. It reported sales revenue of 19 billion yuan ($2.9 billion) in 2015.

Other Czech companies engaging in automobile, rail transportation and machine tool sectors have also tapped the Chinese market for years.

China-Czech cooperation has a strong potential for further development, especially in the machinery, aviation, automobile, energy, biology, nanotechnology and new materials sectors. And companies from the two countries are welcome to enhance cooperation in such sectors as smart cities, telecom services, e-commerce, online tourism and software development.

China's new development plans in the coming years will continue to offer opportunities to foreign businesses including those from the Czech Republic.

During the 13th Five-Year Plan (2016-20), China will put more priority on innovation-driven strategy, energy conservation and environmental protection, in a bid to promote its industrial and economic upgrades and build a resource conserving and environmentally friendly society.

The country will largely increase its investment in foreign countries in the coming five years, and plans to exceed $500 billion. It also plans t o import $10 trillion worth of products.

(China Daily 03/29/2016 page6)