E-commerce giant Alibaba reportedly joins Chinese firms heading to Czech Republic

By bne IntelliNews September 3, 2015

bne IntelliNews -

 

Chinese e-commerce giant Alibaba is eyeing a European hub in the Czech Republic, local media reported on September 3. The claim is the latest in a series suggesting Chinese companies are planning major investments in the country.

The reports will be welcomed in Prague, and especially by President Milos Zeman, who has led a somewhat controversial campaign seeking to lure more investment from the Asian giant.

Representatives of Alibaba visited an industrial zone in Cheb, in western Czech Republic, to explore an option to open a distribution centre, Mlada Fronta Dnes reported, without citing a source for the information. Both state investment agency CzechInvest and the manager of the industrial zone declined to comment.

The report comes just a day after local real estate developer CPI said it has agreed a deal to sell a building in downtown Prague to CEFC China. China’s sixth biggest privately owned company, involved in energy and financial services, will establish its European headquarters at the location, the statement said.

Meanwhile, pharmaceutical producer Xiuzheng and Fosun Group, one of China’s largest private conglomerates, are also reported to be mulling major investments in the country. Bank of China announced earlier this week it will set up a branch in the Czech Republic this year to support its compatriots.

Prague, like its Central and Eastern European peers, is seeking a slice of China's massive investment war chest, as well as increased trade with the Asian giant in a bid to diversify its export markets. The launch of direct flights between Prague and Beijing in September will be a step in that direction. 

Efforts by the Czech government to boost trade with China have been pushed heavily by President Zeman. Never afraid to court controversy, his naked economic diplomacy has been at the centre of a debate over the direction of the country's foreign policy.

His visit to China last year kicked off a fuss in the media, with the column inches lengthening when he got a lift home on the private jet of Petr Kellner, the secretive Czech owner of financial group PPF Group. Members of another closely held financial holding, J&T Group, were also on the jaunt.

The president is currently back in the Chinese capital as the only EU leader to attend a military parade in Beijing marking the end of World War II in Asia. EU leaders will stay away from the events amid concerns that the show of military power could send the wrong signal in an already tense region.

Zeman has broken EU ranks for the second time in four months. He was one of only two EU heads of state to visit Moscow in May for events commemorating the end of what Russia calls the Great Patriotic War. During his upcoming stay in China, Zeman will again meet with Russian President Vladimir Putin.

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