New study ranks Czechia best manufacturing destination in Europe
Czechia is the best manufacturing destination in Europe, according to a new study carried out by real estate giant Cushman and Wakefield. The country has regularly ranked among the best destination for manufacturers seeking to locate their operations since 2016, when it was included in the study for the first time.
As the case was last year, Czechia is the best-performing country in Europe in terms of the baseline rating, which ascribes the same weight to operating conditions and the country’s cost competitiveness. It is the only European country in the global top five, ranking alongside premier manufacturing destinations such as China, the US and India, which took the first three positions both last and this year. Canada remains in fifth position, as last year.
“The fact that the Czechia has been among the countries suitable for the manufacturing sector for a long time is good news for our economy,” says Ferdinand Hlobil, partner and head of industrial agency CEE, Cushman and Wakefield. “Major contributing factors are the country’s strategic position in the centre of Europe with good transport infrastructure, the advanced local business, economic and political environment with a low rate of risk and also moderate labour, energy and development costs.”
Elsewhere in emerging Europe, Lithuania, Poland, Hungary, Romania and Bulgaria all make the global top 20.
The study notes that strong foreign direct investment into Czechia’s manufacturing sector has made it possible to develop a modern infrastructure network with strong links to Germany. More specifically, leading up to the pandemic, labour markets in Katowice (Southwest Poland), northern Czechia and Slovakia had been very tight with almost a zero unemployment rate, significant wage inflation, and high employee turnover. The economic shock caused by lockdowns could potentially ease labour market conditions that, up until now have put pressure on many manufacturers to consider locations further east. In addition to a well-developed infrastructure, the study notes, the CEE region is part of the EU and has one of the highest densities of blue-collar workers in Europe.