16.05.2002 / 10:50
The role of the Czech Ministry of Foreign Affairs in supporting Czech export in the context of the Ministry´s tasks in external economic relations
1) Economic diplomacy and export-oriented policy in the activities of the Ministry of Foreign Affairs and Czech Embassies abroad
The economic diplomacy and export-oriented policy became an unseparable part of the Concept of the Foreign Policy of the Czech Republic, approved by governmental provision No. 124 as of 17th February 1999.
Especially in the countries with a strong state direction, Heads of the Missions abroad and other diplomats in local offices participate in promoting Czech companies. One of the preconditions for the implementation of efficient support for both the economic cooperation and export consist of the activities of Missions in a whole spectrum of bilateral relations with a given country. Foreign service focuses on external economic relations not only in a supportive, but as well in a more direct way. It coordinates, for example, the participation of the Czech Republic in a whole range of international organizations. In a number of countries (e.g. in the Middle East, etc.) the Embassies do not have Economic and Commercial Sections (hereinafter also "ECS") and their role is taken over by the Czech Ministry of Foreign Affairs (hereinafter also "MFA") by means of diplomats, charged with other duties as well.
Czech Missions abroad, and especially their Heads and employees of ECSs, participate in all larger cases of economic cooperation to the extent given by the character of the matter, local conditions, as well as the coordination between ministries.
In October 1999, the Codex of Cooperation of the CE Sections of Embassies with Business Subjects was amended in cooperation with the Czech Ministry of Industry and Trade (hereinafter also "MIT"). This Codex enables Czech companies to make use of ECSs for the activities which provide them with great opportunities. Missions and their ECSs place increased the emphasis on the export-oriented support for individual business subjects, such as helping them make first contacts with potential business partners, organize expert consultations on the economic and business environment in a given territory, involving Czech companies into international competitions, production cooperations, and participation in trade fairs and exhibitions, etc.
In international organizations, of which the Czech Republic is a member, as well as in its attitude towards those, of which the Czech Republic is not a member, the MFA strives for the fulfilment of Czech economic interests. It consults and coordinates its procedures with the ministries which have national economic powers (for example, via interministerial working groups for the cooperation with OECD), hands its suggestions over to national coordinators, especially in the cases of possible participation of domestic subjects in selective procedures. It iniciates and coordinates the transposition of international rules of economic relations into national legislation and practice and, while preparing these standards, it pays regard to the enforcement of Czech economic interests.
In case of topical international problems with economic consequences, the Ministry coordinates the procedures of other ministries in compliance with the compentence law. In the past period the Ministry concentrated especially on the elaboration of a financial and conceptional framework for the involvement of the Czech Republic into the stabilization and renewal of South Eastern Europe, with the emphasis on the strenghtening of the Czech economic presence in the Balkans, including the increase of export. The MFA participates also in creating the database of companies which are interested in participating in the reconstruction of the Balkan region, the coordination of cooperation with Greece in this area, and the establishment of an office in Thessaloniki, the main task of which will consist in direct support for the given Czech companies. In bilateral and multilateral negotiations, this results in the need to harmonize two interests: to contribute to humanitarian and development assistance for the region and, at the same time, make use of the Czech economic potential.
2) Activities related to the EU
Within the framework of its compentence, the MFA in relation to the EU ensures the supervision over the implementation of the Economic Agreement, many items of which directly concern the liberalization of exporting Czech production into the member states. The MFA actively approaches the negotiations with the EU on the conclusion of the Protocol to the Europe Agreement on Conformity Assessment and Acceptance of Industrial Products (PECA), negotiations on the conclusion and implementation of the Phytosanitary and Veterinary Protocol and the monitoring of the Czech Republic´s procedure when taking over technical regulations and standards of the EU. At the same time, the Embassy in Bonn has fundamentally contributed to the fact that by means of the Czech Standards Institute the Czech Republic has been the first country from Central and Eastern Europe since 1997, which has become a fully-fledged member of the European Standards Committee (CEN) and the European Committee for Electrotechnical Standardization (CENELEC). This fact directly influences the strenghtening of the competitive power of Czech products on advanced markets.
The MFA also cooperates with the MIT on the completion of documents of strategic economic importance, and negotiates their principles with the EU bodies. As an example we can mention the Concept of Industrial Policy of the Czech Republic.The active role of the Ministry was apparent in the course of negotiations on important investment incentives, supporting the production for export - for example, investment incentives for Škoda Auto a.s. (Inc.).
The MFA cooperates with the Permanent Mission of the ČR in Brussels in cases of antidumping procedures (whether iniciated or prepared from the part of the EU) against Czech subjects - participants of these procedures - and provides help with the acquisition and handing-over of necessary information.
3) Other information and export-oriented activities of the Czech Ministry of Foreign Affairs and Embassies in external economic relations
The MFA plays a direct role when organizing the following commercially economic activities:
- visits of the representatives of Czech economic ministries and business subjects in the territories,
- organization of business missions during the journeys of the Minister of Foreign Affairs,
- cooperation in the process of ensuring Czech participation in exhibitions and trade fairs,
- membership in international organizations and agencies (e.g. OECD, UNDP, UNIDO, etc.), in whose bodies the Czech Republic is represented by MFA employees.
Part of the information (e.g. comprehensive territorial information, demands and offers, news concerning announced tenders, etc.) directly from the territories goes to the MIT, CzechTrade, other ministries and business subjects by means of Czech Missions, or from public MFA databases on the Internet ( www.czech.cz, www.export.cz).
The MFA actively supports the influx of direct foreign investments, favourably influencing the export:
- towards the end of 1999 the Ministry took over the control of the visit of the highest representatives of the companies operating on a global scale, associated in the IPAC (International Public Affairs Centre) association, who have negotiated with the Prime Minister and members of the Czech Government on investment possibilities in the Czech Republic - some of the investments are currently being carried out,
- the MFA coordinates repeated visits of a group of British investors lead by Sir William Francis in the Czech Republic (interested in the introduction of gas, construction of motorways, sewage plants and railways) - in this case, it also ensures negotiations with the members of the Czech Government.
4) Cooperation of the Missions with CzechTrade
Czech Embassies cooperate with CzechTrade experts. They enable them to make use of the information databases of the Embassies and put them in contact with people important for pushing through Czech interests in a given territory (e.g. with governmental representatives). They also provide office space for the activity of these experts (e.g. the Embassy in Riga) and the MFA helps them with the provision of official passports.
5) Export-oriented activity of Czech Centres abroad
Export-oriented activity of 17 Czech Centres(hereinafter also "CC") abroad and the Administration of Czech Centres (hereinafter also "ACC"), which is a budgetary organization of the MFA, include the following items:
- providing Czech subjects with predominantly tollfree information on business opportunities, the country of potential export, etc. - mostly on the Internet,
- promoting our companies abroad, for example, in the form of presentations, professional seminars, organized on the premises or with the help of Czech Centres,
- active searching for foreign business partners,
- tollfree advertising in the selected foreign press.
For example in 1999, seventeen Czech Centres abroad carried out almost 200 presentations of 253 Czech companies, 43 business meetings, 82 seminars and press conferences on economic and commercial topics, and approximately 3800 presentations of Czech companies in the form of press advertising.
The activity of Czech Centres accompanies the work of CzechTrade, which bears the main responsibility. Czech Centres ensure the widest general promotion of the country and its economy, which is connected to the closer targeted export-oriented activity of CzechTrade. The MFA iniciated negotiations on the strenghtening the cooperation among Czech Centres, CzechTrade, CzechInvest and the Czech Central of Tourism with the aim to remove duplicities and make better use of office and exhibition buildings of the Czech Republic abroad. The Agreement on the Cooperation of CzechTrade with the Administration of Czech Centres, signed at the end of 2000, is a suitable appendix to the agreement between the MFA and MIT on the coordination of activities subordinate to budgetary organizations from the beginning of 1999.
The Administration of Czech Centres controls for the MFA the Website of export assistance, whose number of visitors remained high in 1999 (346.600 visits with the average choice of 8 pieces of information). The website contains information of Czech Embassies and Czech Centres abroad - mostly comprehensive territorial information, news on public contests and topical demands from individual territories.
6) Export-oriented activities of Consulates General and Honorary Consulates
The MFA constantly pays regard to making the support for economic relations a permanent and key part of the work of Consulates General and Honorary Consulates including their active involvement into the support for Czech export. The contribution of Czech Consulates consists in their suitable regional distribution and consequent orientation towards decisive local business subjects (mostly small and middle-sized companies). For the above-mentioned reason, the MFA will continue to strive especially for the increase of the number of Honorary Consulates. Honorary Consuls are mostly a source of ideas for the strenghtening of bilateral economic cooperation and initiators of business missions from and to the Czech Republic.
7) MFA activities and information provision during the preparation of meetings of governmental representatives and business circles with their foreign partners
Basic materials, prepared by the MFA for the meetings of state representatives with their foreign partners, besides the information part focused on the current political and economic situation in a given territory and the development of mutual relations, always contain topics from the area of foreign trade and economy, where, apart of classical business exchange and evaluation of the possibilities of production cooperation, mutual cooperation on terciary markets, foundation of joint companies and other things are also taken into account.
8) Development help
As a result of the strenghtening of the Czech Republic as a member of the community of developed countries, the importance of the provided Czech development help keeps growing. In many cases this help represents a condition for the consequent successful development of economic relations with the help receiving countries. Playing the role of a coordinator, the MFA prepares the proposal of a new concept of development help that will change the existing concept in terms of quality and quantity. It will especially change the ratio of technical, educational and scientific help and the ratio of national and international projects. At the same time, it will come closer to the concept of development help as it is being carried out by other OECD countries. It is often reminded that development help is also one way to sell the national know-how and production. The MFA, however, also has to respect the strong pressure of the largest world donnors on releasing the development help from the condition of supplying national products or services.
9) The implementation of tasks resulting from the closed Agreement on Cooperation between the Ministry of Industry and Trade and the Ministry of Foreign Affairs
The Agreement on Cooperation between the Ministry of Industry and Trade and the Ministry of Foreign Affairs is one of partial instruments that are to ensure the efficiency of the state administration procedure when applying Czech economic interests abroad.
The MFA participates in the fulfilment of the Agreement on Cooperation especially by means of a permanent working MFA-MIT group. For example, the amendment of the main tasks of economic and commercial departments and reports from embassies by two joint commands has been ensured within the framework of this agreement. At the same time, among work duties of economic and commercial sections, the orientation towards the increasing of Czech export and searching for new business opportunities were emphasized again. The MFA cares for the equipment of ECS employees with the highest possible diplomatic rank, that can facilitate their export-oriented activity in the given territories. In cooperation with the MIT, the MFA supplied ECSs of the embassies with 9 diplomats in 1999, in 2000 with 15 employees and further strenghtening of the foreign network is being prepared.
In connection with the Agreement, the posts of economic advisors of territorial departments directors in the MFA political departments have been created with the aim to better adapt the MFA organization structure to the needs of the export-oriented policy and its interconnection with the operation in bilateral relations.
Heads of Czech Missions abroad are also systematicly prepared at the Ministry of Foreign Affairs for practical activity in the export-oriented policy. During their preparation in the headquarters, they visit enterprises and contact institutions which have some business interests in a given territory. The duty of active support of business activities of Czech companies is also anchored in their work specification.
10) The role of the MFA in the national coordination of external economic relations and foreign trade
The MFA is a member of the Czech Council for Business and Export Assistance, which is an interministerial coordinating and advisory body for the area of state business and export assistance. It analyses the situation in individual areas of state support and issues recommendations for relevant bodies and institutions.
The MFA actively exercises its share-holder´s rights in EGAP and ČEB. It contributed, for example, to the acceleration of issuing the guarantee for the supplies of Škoda Plzeň trams to Portland, USA, and the implementation of this business case was also diplomaticly supported on the spot by the Czech Embassy, Consulate General and Honorary Consul. Making use of the suggestions and information from the Embassy, the Ministry comments all big export cases.
The Ministry is also a member of the interministerial offset commission, presided by the MIT. In this commission, the MFA actively promotes the implementation of the import of top production technologies related to the export of Czech products to foreign markets, and the active involvement of Czech companies into external economic relations.