Ministry of Industry and Trade of the Czech Republ : The business delegation headed by Minister Kuba made successful presentations in southeast Asia

Published: 28.1.2013

Author: Veronika Forejtová, press spokeswoman [e-mail]

The delegation of Czech businessmen, headed by the Minister of Industry and Trade Martin Kuba, ended its journey to finding new partners in southeast Asia with meetings in Thailand and Myanmar.

The business delegation headed by Minister Kuba made successful presentations in southeast Asia.

THE DELEGATION OF CZECH BUSINESSMEN, HEADED BY THE MINISTER OF INDUSTRY AND TRADE MARTIN KUBA, ENDED ITS JOURNEY TO FINDING NEW PARTNERS IN SOUTHEAST ASIA WITH MEETINGS IN THAILAND AND MYANMAR. HOWEVER DIFFERENT THE TWO COUNTRIES MAY BE IN TERMS OF THE DEVELOPMENT LEVELS AND STRUCTURES OF THEIR ECONOMIES, THEY BOTH REPRESENT AN ATTRACTIVE BUSINESS AND INVESTMENT OPPORTUNITY FOR CZECH COMPANIES. THIS WAS ALSO THE CASE OF VIETNAM, WHERE THE CONFEDERATION OF INDUSTRY'S DELEGATION BEGAN ITS ONE-WEEK JOURNEY.

Minister Kuba travelled to Thailand as the first Minister of Industry and Trade of the CR in almost 20 years. He did so in accordance with the requests raised by businessmen, who are asking the state to support them especially in high-priority countries and countries of interest within the export strategy of the CR, which includes Thailand.

"Tens of thousands of Czech citizens spend their vacations in Thailand every year. Now it is time to get to know this country better economically and take advantage of the fact that it is one of the fastest growing markets within ASEAN and has an economy that has a complementary nature to ours, said Kuba, who met with several key ministers of the Government of Thailand in Bangkok.

Kuba assured the Deputy Prime Minister and Minister of Finance Kittirat Na Ranong that there are countries in the EU who are not facing a debt crisis and have healthy banking systems. He also informed him that it is the complexities related to the developments in the Eurozone that are forcing Czech companies to diversify as far as economic partners are concerned. The Thai Deputy Prime Minister responded by saying that fiscal consolidation is also key for his country and the country's development priorities are aimed at the building of infrastructure and measures that will make it possible to deal with the destructive effects of floods, such as the ones that struck Thailand in 2011.

"The Deputy Prime Minister mentioned that contracts in these areas will be worth up to 80 billion dollars in the following years. And these are areas in which Czech companies have excellent skills. It would be good if they were awarded at least some of these contracts, whether in the role of main contractors or sub-contractors, emphasized Kuba.

In a meeting with the Minister of Commerce Boonsong Teriyapirom, the ministers agreed that in the implementation of the newly concluded intergovernmental agreement on economic cooperation they will focus on specific projects of cooperation between Czech and Thai companies. Minister Kuba said that the agreement will be a significant addition to the new contractual framework at the level of relations between Brussels and Bangkok and emphasized that after Singapore, the CR is interested in also agreeing to a free trade agreement with Thailand as soon as possible.

On behalf of Thailand, the new agreement was signed together with Kuba by Deputy Prime Minister and Minister of Foreign Affairs Surapong Tovichakchaikul. "The agreement is an important milestone on the road towards the further development of our commercial and economic relations. Through more frequent contact at the governmental level within our mixed committee we are sure to succeed in fulfilling our common intention of increased trade and investments, declared the Minister, who is pleased that the first meeting of the committee will take place already in the second half of this year, on the basis of his invitation of the Deputy Prime Minister. "Czech companies are interested in cooperating with Thai partners and I see considerable opportunities especially in the energy industry, the environment, engineering, infrastructure and the defence and security industry, he added. This interest was confirmed by a memorandum of cooperation between business representations, which was signed on behalf of the Confederation of Industry of the CR by its President Jaroslav Hanák.

"We believe in much closer cooperation with the CR and this document should help in this, emphasized the Thai counterpart, whose statement showed the interest in even more intense contact between the citizens of both countries and in the further development of tourism. Both ministers are also convinced that direct air service between both countries would facilitate economic relations and meetings.

While in Bangkok, Kuba also discussed the business opportunities in the military-industrial sector. He and Minister of Defence Sukampol Suwannathat exchanged opinions on how to cooperate in the areas of previously supplied aircraft, modernization of airports, supply of combat vehicles and education within Czech training centers.

"Thailand is attractive for us from the perspective of several potential projects. For example, we are interested in modernizing its communication technology. The fact that we were able to meet directly with representatives of the Government of Thailand is extremely valuable for us, noted Jan Köhler from the company T - CZ, which supplies radio location and radio communication systems.

In his opening speech at the Czech-Thai Business Forum, Kuba pointed out the need to increase the current trade volume between the CR and Thailand and to bring more Czech companies to Asia, as this would open huge markets for them. The President of the COI added the following words to the presentation: "The Czech Republic is an open and industrially advanced country that can become a strong business partner for Thailand, especially in the supply of machinery, equipment, agricultural and medical equipment, chemicals and technology for food processing and the army.

The delegation completed the full program in Thailand with a meeting with the President of the Italian-Thai Development company Premchai Karnasuta, one of the largest Thai real estate development and construction companies. The meeting's main topic was a discussion of the possibilities of participation by Czech companies in the building of a special economic zone in Dawei in Myanmar. This is a joint Thai-Myanmar project designed to facilitate Thailand's access to strategic raw materials through a new port. It is noteworthy that Czech companies were the first from the ranks of European companies that were invited to participate in this project.

According to the members of the mission, the outcome of the meetings not only in Thailand but in two other countries in Southeastern Asia was significantly positively influenced by the fact that they were headed directly by a representative of the Czech government. "The fact the delegation is headed by the Minister of Industry and Trade plays a big role in these countries, especially with regard for the fact that the companies have the opportunities to meet directly with representatives of the local governments and find out more about specific planned projects or about their needs. I would therefore like to say how much I appreciate the direct participation of the minister on this trip, because this mission was one of the reasons why with high probability an electric power plant worth ten billion crowns will be built in Vietnam, and together with other partners we will be participating in this project, said Milan ©imáèek, Deputy CEO of EGAP.

The end of the one-week business trip brought Martin Kuba's delegation to Naypyidaw, the capital city of Myanmar, formerly Barma, which today is a country that has gotten out of political isolation and is going through a process of deep political, social and economic reforms.

"With this visit we wanted to not only support the peace process and the process of reconciliation in this country, but to also become more closely acquainted with the economic priorities of Myanmar's government and how Czech companies could become involved in their implementation, said Kuba and added that with the visit the CR is trying to follow in the footsteps of the best of the tradition of mutual relations.

In the past, Czech companies built seven complexes in Myanmar (a brewery, sugar refinery, tannery, power plant and plants for the manufacturing of tractors, pumps and tires), and some of them are still in operation. Representatives of Myanmar view this former cooperation very positively and are sincerely interested in having it continue on new foundations.

What such cooperation could look like was a topic of meetings between Minister Kuba and the ministers of finance, trade, energy (oil and natural gas), electricity, industry, national planning and economic development. The exchanges that took place showed that the Government of Myanmar is not only interested in foreign development cooperation projects, but that it also wants to create an environment that will be attractive enough for foreign investors and that will lead to the growth of the private sector.

Proof of this is a very liberal investment act, which came into legal force two months ago, as well as the plans to privatize state-owned companies (one hundred companies in the industry department alone). In connection with these two as well as other areas, the Czech side offered its experience from its transformation and the development of a full-fledged market economy, which it is prepared to transfer through the training of Myanmar specialists in the CR or by sending Czech experts to the remote country.

"Even though our country's position at the beginning of the 1990's was somewhat different due to the well-known circumstances, we can still help Myanmar in many aspects, said Kuba, who conveyed for the Myanmar representatives the interest of the Czech side in projects that will allow Myanmar to take advantage of the vast mineral wealth, participate in the development of the energy industry, modernize agriculture and build new industrial plants.

Minister Kuba was pleased that the CR is one of the first European countries making the trip to Myanmar with such a large business group. "To be honest, it is not always the case that we are able to react so quickly to events in certain countries and support the positive changes in them through economic cooperation with Czech companies, he said and added that the government will stimulate this economic cooperation at the company level through the newly established embassy in Myanmar, by concluding a new contractual framework for economic cooperation, state supported financing and insurance of exports as well as by duty-free imports into the EU within its general system of customs preferences.

"A trip by the Minister of Industry and Trade, accompanied by a delegation of the Confederation of Industry of the CR, which followed up on the earlier visit by the Minister of Foreign Affairs, is a model that we would also welcome in the future. We are speaking of countries in which personal contact and relationships play a considerable role and where in this way government representatives can open the doors to new contracts for businessmen, said Vítìzslav Grepl, the Ambassador of the CR to Myanmar, seated in Bangkok.

In Myanmar the delegation also visited the city of Yangon (formerly Rangoon), the country's commercial and industrial center. Here, as a part of a forum organized by the Myanmar Federation of Chambers of Commerce and Industry, Czech companies met with their Myanmarese counterparts and discussed specific business opportunities. "I think that we were all pleasantly surprised by the large number of visitors to the forum from the host country and by the considerable interest shown by Myanmarese companies in establishing contacts with Czech partners, said Minister Kuba, who made the opening speech at the business meeting.

"In Myanmar we did not even expect to meet with the representatives of so many ministries, where we consulted interesting topics that can have potential. Moreover, we made a deal with one private company at the business meeting regarding one attractive project that concerns transport services , said Karel Pospí¹il, Director of the Transport Research Center, an institution that examines all aspects of transport.

Overall, the results of the meetings held during the trip through Southeast Asia clearly confirmed that the priorities of the export strategy as well as the country's orientation towards countries with potential for new opportunities for Czech companies have been set correctly.

"The territory of Southeast Asia is very attractive for us. These are countries without a developed infrastructure, and we produce machinery for building it and for the construction industry in general. Vietnam, and especially Myanmar, do not have roads and railways, which is why we are interested in them. In these countries, where the state is planning and financing such construction projects, it is therefore important that the delegation is headed by a minister, said Martin Trousil, the Marketing Director of DSP Pøerov, of the week long business mission.

The situation was summarized by Minister Kuba, who was very satisfied with the trip and its outcomes: "The region of Southeast Asia, the community of ASEAN countries with approximately 600 million consumers, which includes Vietnam, Thailand and Myanmar, is exactly the kind of area in which Czech companies can be successful. We have not only a decent tradition there, but they also perceive the current position of the CR in the global economy positively. I would also like to bring attention to the fact that I also see considerable potential there for small and medium sized companies, which thanks to their flexibility and skills can react very well to the rapidly developing needs of the markets in the visited countries.