Incentives need change

In the last five years, the Moravian-Silesian Region has attracted investments of over CZK 75 billion, making it one of the most sought-after parts of the country. However, the 2009 figures were the worst in five years. In the first half of 2008, twenty investors began operating in northern Moravia, with projects totalling CZK 5 bn. However, 2009 brought only 18 new projects with a total value of CZK 209 million. Only one of these projects was in response to incentives; the rest were funded via the OP Enterprise and Innovation. None of the investments involved 100% foreign capital. In 2009, the M-S Region accounted for just 2 percent of total investment in the Czech Republic. Paradoxically, the mason behind this rapid drop in foreign direct investment is the Region's success in creating new jobs, bringing a dramatic fall in unemployment. Marian Lebiedzik, Deputy to the Regional President responsible for regional development, commented: "The drop in investments is partly caused by the recession, but also by the ineffectiveness of the current law on incentives.