The Czech Republic ranks as the best location for manufacturing in Europe, according to new research published by real estate services firm Cushman and Wakefield.
The study titled "Manufacturing Risk Index 2019" looked at a wide range of criteria, including costs of construction, labour and electricity, labour supply, risks (including economic, political and natural disaster) as well as the pace of adoption of technology.
The data underpinning the Manufacturing Risk Index (MRI) comes from a variety of reliable sources, including the World Bank, UNCTAD and Oxford Economics.
“These rankings provide critical insight into the rapidly-evolving manufacturing landscape and the decision-making factors behind locations. Global manufacturing has entered a new era, marked by the growing influence of technology in addressing productivity, labour shortages and safety in production and logistics” Report author Lisa Graham, Cushman & Wakefield’s EMEA Head of Logistics and Industrial Research & Insight, said.
“We are seeing formerly low-cost locations such as China and India moving up through the value production chain through country-sponsored support of technological adoption. That is why Asian countries featured so prominently in our rankings. There are still concerns over intellectual property issues in the region which mean, that despite higher costs, countries in North America and Europe will continue to thrive as manufacturing bases,” she added.
Comparing the suitability of locations for global manufacturers to expand in or relocate their operations to in EMEA, the Americas and Asia-Pacific the study placed the Czech Republic fifth globally and first in Europe.
“While the Czech Republic is far from being the cheapest country for the manufacturing industry, considering not just the payroll costs for the local labour but also the costs of utilities, industrial development and administrative charges, it is rated as the best manufacturing destination in Europe primarily thanks to a high degree of security, relative political stability compared with countries in the east of Europe and also economic and corporate stability. In effect, the risks for investors are minimal. Its central position with strategic access to Europe’s main markets is a great advantage as well,” Ferdinand Hlobil, Partner and Head of Industrial agency, CEE at Cushman & Wakefield said.
The Czech Republic has been a manufacturing industry leader for decades. The landlocked central European nation shipped US$202.1 billion worth of goods around the globe in 2018. That dollar amount reflects a 10.9% increase from 2017 to 2018. Czech Republic's most valuable export products are cars followed by automobile parts and accessories, computers and mobile phones.
Czech Republic is ranked 35th out of 190 countries in the World Bank's Doing Business 2019.
In January 2019, the country was described by The Guardian as "one of Europe’s most flourishing economies".
The Czech Republic remains the European Union country with the lowest unemployment rate, new data made public by Eurostat show. In March 2019, the EU statistical office said, the lowest share of people out of work was registered in Czechia (1.9% unemployment rate), followed by Germany (3.2%).