Amazon cancels order on Czech investment

By bne IntelliNews April 2, 2014

bne -

US internet retail giant Amazon has scrapped a plan to build a logistics centre in the Czech city of Brno after the local authorities blocked the warehouse. The head of the company's European operations said it is now considering two other sites "in Central and Eastern Europe".

"We respect the decision of the city of Brno and we won't pursue this project," Tim Collins told journalists gathered at one of Amazon's 10 German logistics centres in Graben. Brno's city council withdrew the building permit for the project near the city's international airport last month.

The Brno location was one of five facilities in Amazon's strategy for expanding in CEE. Collins said recruitment for management at a warehouse near Prague has now started, with operations set for "late summer 2015". Three Polish operations should be ready by September, he added.

Amazon would not be drawn on the location of the Brno replacement, but Collins said it has "two alternatives" currently. Slovakia began lobbying instantly in the wake of the decision by the Brno authorities, while the mayor of the Moravian city had been trying to offer an alternative. Other Czech cities such as Ostrava have also said they'd be keen to see the investment, with each facility worth around €100m, and likely to bring over 3,000 jobs.

All five of the CEE projects were announced at the same time. On the one hand, Collins says that the permitting process is quicker in Poland. On the other, he insists the national and regional authorities in both Poland and the Czech Republic have been strong, but delays on the Prague logistics centre stem from "project particulars".

Zero dollars
The Amazon director claims that the US company "brings a lot to the table, but asks for little. We've asked for zero dollars from the Czechs and Poles," Collins continues, "only for help to make the project quick."

"The fundamental thing we need is speed," he says. That, he says, will be the deciding factor for nailing down a new location.

"The end of investment plans by Amazon in Brno doesn't discourage the government from its steady hard work to attract new investments namely into the regions with high unemployment levels," Bohuslav Sobotka, the Czech Prime Minister, said, according to Dow Jones.

However, Radek Spicar, vice president of the Czech Confederation of Industry, claimed Amazon's decision could hurt the country's reputation with foreign investors. "We are now in a situation when the Czech Republic is losing, to a certain extent, its attractiveness in the eyes of foreign investors, for a number of reasons," he told Radio Praha.

"One of them is the high prices of energy," he continued. "It's also known it's not easy to invest here because of human resources, that is, skilled labour force is not always available everywhere. The high taxation of high-earners is a big issue, and our immigration policy is not working in a proper way."

Politicians in Brno reacted with surprise, Radio Praha reports. Deputy mayor Oliver Pospisil had insisted on April 1 that Amazon were still interested in investing in the project, and said he had received no indication that the internet retailer was going to give up on the city. Mayor Roman Onderka said he would await an official letter from the company regarding its plans.

Related Articles

UK demands for EU reform provoke fury in Visegrad

bne IntelliNews - The Visegrad states raised a chorus of objection on November 10 as the UK prime minister demanded his country's welfare system be allowed to discriminate between EU citizens. The ... more

Czech food producer Hame seen next on the menu for Chinese giant

bne IntelliNews - Following a smorgasbord of acquisitions in late summer, China Energy Company Limited (CEFC) is eyeing yet another small Czech purchase, with food ... more

INTERVIEW: Babis slams coalition partners, but Czech govt seems safe for now

Benjamin Cunningham in Prague - Even as the Czech governing coalition remains in place and broadly popular, tensions between Prime Minister Bohuslav Sobotka and Finance Minister Andrej Babis remain ... more

Register here to continue reading this article and 2 more for free or 12 months full access inc. Magazine and Weekly Newspaper for just $119/year.

If you have already registered, enter the information below with the same email you used previously and you will be granted immediate access.

IntelliNews Pro subscribers click here

Thank you. Please complete your registration by confirming your email address. A confirmation email has been sent to the email address you provided.

Thank you for purchasing a bne IntelliNews subscription. We look forward to serving you as one of our paid subscribers. An email confirmation will be sent to the email address you have provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

If you have any questions please contact us at

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

IntelliNews Pro subscribers click here

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

If you have already registered, enter the information below with the same email you used previously and you will be granted immediate access.

Thank you. Please complete your registration by confirming your email address. The confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.