Italian direct investment in the Czech Republic: the results of a fields analysis

Abstract

The present paper presents the first results of a filed survey on Italian investments in the Central and Eastern European countries. More specifically, this paper is focused on the Italian Investments in the Czech and Slovak Republic. The survey has a qualitative approach put it allows to develop some hypothesis that will be tested in a more comprehensive quantitative analysis. The filed analysis shows that the most important reasons behind Italian investments in the region are: seeking a new market, lowering labour cost and the better law environment in the host country. By the survey, the Italian companies are often export oriented. The respondents have evaluated the degree of autonomy of the subsidiaries which are functioning on the Czech market as medium or low almost unanimously. The Czech and Slovak subsidiaries of Italian firms serve mainly for two markets – the local and Italian one, thus confirming that Italian firms have not used the foreign subsidiaries as a base for entering in the wider regional market. The performance of subsidiaries is evaluated by respondents as good or even very good during last three years. The subsidiaries are conclusively integrated to the Czech economy.