Czechs seek larger part of Chinese market

Czech technicians assemble a plane, being displayed at the 2013 Western China International Fair. The potential for commerce and investments between China and the Czech Republic is believed be enormous. Yu Ping / For China Daily

To Chinese, the Czech Republic conjures scenery and culture. Pavel Kysilka, chairman of the Czech Savings Bank, the central European country's largest bank said there's more.

"Companies in the Czech Republic would be very interesting targets for Chinese investors due to technology know-how, very successful production in industry and agriculture, and the capability to work as a part of the European Union," Kysilka said.

The Czech Savings Bank is a member of the Erste Group, founded in 1819 as the first Austrian savings bank. In 1997 Erste set a strategy to expand into central and Eastern Europe. Kysilka visited China in mid-May to promote trade and investment. He sought partners in China to link them with Czech producers and exporters.

It was ahead of a planned visit by Czech President Milos Zeman and part of a push to boost investment from China.

Kysilka said there is a strong appetite for business on both sides. His visit was to facilitate clients' trade, investment and cooperation.

"My bank is the largest in the Czech Republic. It's a natural gateway for investors to come into the Czech Republic, and central Europe," he said.

The potential for commerce and investments may be enormous. By the end of 2013 trade between China and the 16 countries of central and Eastern Europe was worth $50 billion. That's a one-tenth of China's trade with the European Union and roughly what it does with Italy.

China invests more in Sweden than it does in central and Eastern Europe.

The Czech economy is strongly positioned in central Europe, healthy and stable. That compares with the financial crisis across the eurozone that forced rescue money to be pumped into countries including Greece and Ireland.

Producers with high-quality products can tap Europe, Kysilka said.

Czech companies may not be as widely known as rivals in Western or Northern Europe. Kysilka still thinks they have advantages to attract Chinese investors.

Almost 80 percent of the Czech economy is created by exports. Companies are disciplined to price and quality. The automotive, aviation, and agriculture equipment industries are the most competitive.

Some Czech exporters have penetrated Europe, Latin and North America. India too. None yet is seeking partners in China. Kysilka said he contacted several potential partners as part of his trip.

The Czech Savings Bank plans no operations in China, Kysilka said. It seeks partners to support business opportunities between the two countries. Some cooperation was talked of with the China Banking Regulatory Commission, the Bank of China Ltd, the Agricultural Bank of China Ltd, Minsheng Banking Corp Ltd and the Shanghai Stock Exchange.

Deals are expected to be announced when Czech President Zeman visits.

The goal is to provide the advice, opportunity, financial products and services to enable exports, imports and investments, he said. Mergers, acquisitions and joint ventures are possible, he said, as is cooperation in other countries.

The Chinese market is enormous and dynamically developed. For Czech exporters and producers it can be an excellent opportunity to direct production eastwards and find partners.

This year sees the 65th anniversary of the Czech-China relationship. Czechoslovakia, predecessor to the now separate Czech and Slovakian states, was among the first to acknowledge the establishment of the People's Republic of China in 1949.

"During the last decades we both had successes and pains," Kysilka said. "We are running similar attempts regarding the direction of how to develop society. So definitely there is enormous room for cooperation."