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ambassador to czech republik on central europe

Wednesday 17 June, 2009

The World Trade Center Illinois hosted a breakfast reception featuring the recently returned US Ambassador to the Czech Republik Richard Graber of Reinhart Boerner Van Deuren in Milwaukee who talked about Building your Business and Relationships Across Borders.   This event was co-sponsored by CzechInvest & CzechTrade.  He noted, along with the US being the 4th largest investor in the Czech Republik, these opportunities:

  • Although central Europe is no longer the cheapest in the region, skilled labor still costs 1/3-1/2 of what it does in western Europe.
  • While Romania focuses on manufacturing & assembly, Poland & the Czech Republik are moving into high technology services.
  • American chambers of commerce have lobbied to change regulations, labor codes, & bankruptcy laws so that what formerly took months now takes days.
  • Although there is still not 1 voice, there is a need for alternative sources of energy supply in Europe because Russia’s transgressions have cut-off Europe from its oil & gas from time-to-time.
  • Health care is being reformed in central Europe as well because governments can’t afford to pay 100% of all costs for all people.  Czechs visited a doctor 16 times/year on average, which takes it s toll on the economy.  Despite an uproar, you’re seeing the beginnings of a co-payment system, which already cost some incumbents an election.
  • Central European capitals are great places to live & offer great locations to serve all of Europe, which combined with the US is 40% of world trade & accounts for 55% of world economic output.
  • Much of central Europe, except Poland, has joined the visa-waiver program, which makes travel much easier now

Problems remain with corruption, lack of transparency, intellectual property protection, & slow judicial processes.

His suggestions:

  • find local partners who know the lay of the land
  • take advantage of embassies & chambers of commerce
  • take particular advantage of American chambers of commerce

Q&A

  • upon returning in January from 2 1/2 years in Prague , he didn’t realize how bad the economic crisis is here.  In central Europe, it’s not catastrophic & the banking crisis is less severe.  The crisis varies on a country by country basis, i.e. Hungary is in worse shape than the Czech Republik.
  • a new generation has grown up in central Europe that has never known communism, so exchange programs, Fulbright scholarships, the International Visitors Centers are now even more valuable.
  • there is lots of eternal debate in central Europe on how big a role the European Parliament should play in each country.  Countries won’t lose their identities, although the debate will continue forever.

My take-having spent 7 months in Poland, I’m a somewhat unabashed advocate for central Europe.  Rolling up the EU helps these countries immeasurably, & will ensure their mutual success in the years to come.  The biggest threat is the growing divisions with neighbors to the east & south.  As long as those can be resolved, prosperity should ensue for a long long time.

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