Invest in Prague

Prague is the largest and capital city of Czech Republic and is situated on the Vltava River in the central Bohemia region. It is the economic, cultural and political centre of Czech Republic. It is home to numerous cultural attractions which makes it one of the most popular tourist destinations in the entire Europe.

It is also classified as a global city and stood fifth in terms of having the highest GDP per inhabitant which was 172% of the European Union average. What is more surprising is this was even more than Paris and the whole of Czech Republic which had a GDP per inhabitant 80% of the average of that of European Union.

The Prague city is blessed with a state of the art infrastructure. It has a good rail-road and air transport system which connects it to other parts of Europe. The Prague Ruzyne Airport is one of the busiest airports in Eastern and Central part of Europe. Apart from vibrant infrastructure, Prague also has a good amount of foreign workforce which contributes towards the growth of the city.


In a survey conducted in the year 2010, Prague was found out to be one of the best destinations to do business in Eastern Europe. As recently as of 2009, Prague attracted as many as 4.1 million foreign visitors. The annual analysts Innovation Cities Index placed Prague as one of the top-tier nexus cities for innovation across the various sectors, it ranked 29th among the 289 cities in terms of innovation in the entire world. 


After experiencing economic turmoil due to the global financial crisis, the Czech economy is coming back on track and is expected to grow at a rate of 3% in 2011. This growth is really boosted by the strategic advances provided by Prague city which accounts for major chunk of Czech’s GDP. Thus, there is lot of positive trend prevailing in the Prague economy which would be helpful to foreign investors.

Market Size:

The Czech Republic is a large market for investors and so is Prague. With a population of nearly 2 million, Prague is a large market for people who wish to invest in Prague city. The excellent infrastructure of the city helps businesses to access other markets in and around the country as well as the other markets.

Growth figures and FDI figures:

Prague plays an important role in the development of the Czech Republic. It accounts for as much as 25% of the country’s Gross Domestic Product (GDP). In the year 2007, the GDP per capita of Prague stood at 42,800 Euros. The positive trend of the Czech economy in the coming years is going to benefit the city heavily as one-fifth of the investment made in Czech Republic is done in the Prague city.

Key investment areas:

Prague is mostly an export and service based economy. The Prague city offers numerous opportunities in almost all its sectors. However, some of the sectors worth investing in the city include Real estate sector, strategic services, financial services, telecommunications, tourism and manufacturing. The tourism industry in Prague is really one of the booming industries as Prague consumes more than half of the national income that is spent on tourism. The city has good accommodation facilities which satisfy almost all kinds of visitors.

FDI/Investment policy:

The Czech government follows an investor-friendly investment policy. This is evident from the fact that almost 70 percent of the industries in Czech, majority of which are in Prague run on foreign capital. This has really made Prague one of the largest markets having the largest FDI than any other city in the entire Central and Eastern European region. The Czech government has also set up an agency known as the Czechinvest to encourage foreign investment in the country. This shows the dedication of the government to attract foreign investment in the country.

As an added advantage, the corporate tax rate of Czech Republic is also low and there are no local taxes which in turn has benefited Prague region in a large way. The government of Czech is also offering loads of incentives to foreign investors who are keen in investing in the country which has ultimately benefit the cities of the country.

Special incentives:

The special incentives for investors are involved in the Czech legal system. Foreign investors have to fill in to some of the requirements set by the legal system of the country to avail these incentives. Once investors are able to fulfil these requirements they can avail tax relief for as much as five years.


The Ministry of Industry and trade has established an agency known as Czechinvest which works towards encouraging foreign investment in country. This government agency provides all kinds of valuable information to investors who want to invest in the country. This has really benefited Prague city as it has been successfully able to attract more foreign investment.

A positive growth trend, an investor-friendly government, low tax rates and attractive incentives all these factors really make Prague one of the best destinations to invest not only in the Czech Republic but in the entire Europe. Investors who want to increase their business especially in the CEE region should not overlook the strategic location of this city which has lots in store for investors.

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