CONTACT US
Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting cushmanwakefield.com to read:%0A%0A {0} %0A%0A {1}

Czechia ranks among top ten manufacturing destinations

01/12/2022

• In a ranking of countries with the best conditions for the manufacturing sector, the Czech Republic stands in eighth place, after countries of Asia and Poland
• Czechia owes its success in particular to its security, with a risk profile that is the third lowest worldwide
• Its lower ranking this year reflects the rise in construction and energy costs

 

The Czech Republic maintained its top ten global ranking this year in the annual Manufacturing Risk Index (MRI) compiled by Cushman & Wakefield, which assesses criteria such as operating costs, labour, and economic and political risk. Since 2016, when the Czech Republic was included in the MRI for the first time, it has been ranked among the best manufacturing destinations on a regular basis. This year, Poland edged ahead of the Czech Republic in the 47-country comparison, mainly due to its cheaper labour and lower energy prices.

 

Jiří Kristek, Partner and Head of the Industrial Team, Cushman & Wakefield: “The great news is that, in spite of the current negative climate, the Czech Republic remains at the top of the list of countries whose manufacturing sector is thriving. Major factors behind this are its well-developed transport infrastructure, a business and economic environment that is sustainable, transparent and low-risk, and relatively affordable labour. On the other hand, factors that diminish the country’s appeal include its construction and energy costs, which have been climbing dramatically, especially over the recent period.”

Asia and CEE countries top the rankings

This year, Asia dominated the Baseline scenario ranking, which gives equal importance to a country’s operating conditions and cost competitiveness. Of the top 12 locations, half are in APAC, particularly due to their abundant supply of low-cost labour.

Global Manufacturing Risk Index 2022 Ranking

Ranking 2022           Country              Ranking 2021          
 1  China  1
 2  India  2
 3  Indonesia  6
 4  Malaysia  9
 5  Thailand  8
 6  Poland   10
 7  Vietnam  11
 8  Czech Republic                5
 9  Colombia  13
 10  USA  3
 11  Hungary  16
 12  Slovakia  26

Source: Cushman & Wakefield

 

The Central and Eastern Europe region is also strongly represented, with Poland, the Czech Republic, Hungary and Slovakia all making the top 12. Poland overtook the Czech Republic (having been as much as five places below last year) thanks to its cheaper labour and electricity prices, which are lower there than in many of the other CEE countries.

Jiří Kristek, Partner and Head of the Industrial Team, Cushman & Wakefield: “Judging by their position at the top of the ranking, CEE countries can be expected to remain very attractive for industrial and manufacturing investment. It’s quite striking to see how Poland has leapt ahead from previous years, along with Hungary and Slovakia, so CEE countries are gaining ever greater importance in terms of global demand for manufacturing destinations.”

 

Europe: rising labour and energy costs

Overall, many European countries have bolstered their longer-term economic outlook and risk profile, thanks to improvements in their ability to achieve sustainability targets, efficient use of resources, and the creation of green economic opportunities.

However, uncertainty about energy supply in European countries has increased their economic risk and negatively impacted their economic prospects in the near term. This, along with higher electricity prices (notably as a result of challenges in supply and rising gas prices due to the war in Ukraine) and labour costs (as a lack of staff availability has pushed wages for workers higher), has meant that countries such as France, Netherlands and Spain have suffered falls in their rankings this year. How swiftly these challenges are resolved will make a significant difference to the competitiveness of many European countries as production locations in the near term.

America: risks and reshoring

The 12 top-ranked countries this year include Colombia, which has improved by one position (mainly thanks to cheap labour and electricity), as well as the USA, which has gone in the opposite direction, down to tenth place this year from third the year before. Similarly, Canada – which was just ahead of the Czech Republic in fourth place in 2021 – has fallen to 19th this year. Both North American countries have maintained a stable cost environment, but have seen an increase in risk elements. This is particularly due to their exposure to natural disaster risk, but also results from a drop in the unemployment rate, and therefore access to available labour. At the same time, the United States is also making a major “reshoring” push, bringing jobs back home to reduce risk and diversify supply chains.

Czechia: the third lowest risk profile and 21st in costs

In the risk scenario, the Czech Republic ranked third this year – two places up from the year before. This comparison looks at geopolitical stability, long-term sustainability targets, market transparency and investment potential.

Table 2: Ranking of countries in the Global Manufacturing Risk Index 2022, risk scenario

2022 Ranking Country 2021 Ranking 
 1  China  1
 2  South Korea  7
 3  Czech Republic  5
 4  Indonesia  27
 5  Canada  2
 6  Finland  4
 7  Singapore  9
 8  Poland  17
 9  Sweden  6
 10  Malaysia  25
 11  USA  3
 12  Germany  8
Source: Cushman & Wakefield

 

In terms of costs, the Czech Republic dropped from 15th to 21st place, mainly due to the increase in energy prices. In Asia, however, these still remain low, along with labour costs, and APAC countries thus account for two thirds of the best 12 rankings. Turkey and Poland also made the top 12, together with Colombia and Peru.


Jiří Kristek, Partner and Head of the Industrial Team, Cushman & Wakefield: “Czechia remains a country with excellent conditions for the manufacturing sector. The risks here are minimal, conditions are stable, and costs are at an acceptable level compared to neighbouring countries. If investors take the combination of all of these factors into account, then the Czech Republic could easily be their first choice.”

 

About the survey
Cushman & Wakefield’s Manufacturing Risk Index rates each country based on 20 variables, resulting in three weighted rankings rating the conditions, costs and risks for manufacturing. The data underpinning the rating comes from a variety of reliable sources including the World Economic Forum, Moody’s Analytics and the World Bank.

A summary report with survey results is available for download HERE.


 

Media Contact

Michaela Sedlbauerov
Michaela Šedlbauerová

Head of Marketing Czech Republic • Prague

Related News

store, shop, DJI, street, people
The first half of 2024 is a record year, the Czech Republic has received so far 20 new brands

20 brands entered the Czech retail market in the first six months of this year.

09/07/2024

award ceremony, people
Cushman & Wakefield outstanding achievements recognized by CEEQA jury

Cushman & Wakefield named Capital Markets Agent of the Year 2023 at the CEEQA Award.

24/06/2024

shop, store
Retail market activity grows, especially in fashion, F&B, and health & beauty sector

In 2023, rental activity in the Czech and European retail markets significantly increased year-over-year, with a rise in the number of transactions and the volume of leased space across sectors and countries.

18/06/2024

retail park, shopping
Cushman & Wakefield and CENTERSCAPE: 20 years of cooperation

Cushman & Wakefield, a leading real estate consultancy, has been cooperating with CENTERSCAPE, an investment company that owns 20 retail projects in the Czech Republic, for 20 years.

10/06/2024

Industrail space, warehouse
Record demand for industrial space

Interest in industrial and logistics space in the Czech Republic was at a record high in 2023, up 50% from 2019, which means one million sq m in demand.

29/05/2024

Shopping centre, city, street
Cushman & Wakefield manages SC Opatovská

The real estate services firm Cushman & Wakefield has taken over the management of the OC Opatovská shopping centre in Prague 4, owned by Conseq realitní fond, a significant player on the Czech capital market. Cushman & Wakefield manages OC Opatovská

22/05/2024

Related Insights

European Luxury REtail
Research

European Luxury Retail

Explore the dynamics of the European luxury retail real estate market.
Sally Bruer • 15/05/2024
Czech Republic, Prague, Old Town Square, High Street
MarketBeat

Czech Republic MarketBeat

Cushman & Wakefield MarketBeat reports analyse quarterly Czech Republic commercial property activity across office, retail, industrial and hotel real estate sectors including supply, demand and pricing trends at the market and submarket levels.
Kamila Breen • 30/04/2024
Cover, woman in a meeting room
Insights • Economy

5-minute Real Estate Market Snapshot

Explore our 5-minute Real Estate Market Snapshot, a video overview of the commercial real estate market developments presenting the key trends in real estate investment, logistics, office and retail sectors.

25/03/2024
Office Fit Out Cost Guide - Web card
Research • Workplace

EMEA Office Fit Out Cost Guide - Czech Republic

Discover the essential data for planning and budgeting your office transformation in the Czech Republic with our Office Fit Out Cost Guide 2024. Begin optimizing your workspace in key cities like Prague today!
Thomas Moore • 20/03/2024
office buildings
Insights

Complete Asset Optimisation Guide

Discover expert strategies for optimising logistics, retail, and office real estate assets. Gain insights to maximise returns and improve performance.
Andie Penman • 29/02/2024
main streets across the world 2023
Research

Main Streets Across the World 2023

In this 33rd edition of Main Streets Across the World, we’ll explore the near-term outlook for the retail sector; headline rent and ranking changes for best-in-class urban locations across the world; key indicators and global main street rankings; and key trends to watch such as the cost-of-living crunch, e-commerce and more.
21/11/2023
Women Hotel City
Insights • Investment / Capital Markets

The Hotel Investment Scene in CEE

Welcome to our fourth edition of the joint Cushman & Wakefield–CMS report on the Hotel Investment scene in CEE: Getting Real about ESG in Hotel Real Estate
Bořivoj Vokřínek • 25/10/2023
office, statistics, laptop
MarketBeat • Economy

CEE MarketBeats

Cushman & Wakefield MarketBeat reports analyse quarterly commercial real estate activity in the CEE region (Czech Republic, Hungary, Poland, Romania, and Slovakia) across office, retail, industrial and hospitality real estate sectors including supply, demand and pricing trends at the market and submarket levels.
Marie Baláčová • 13/09/2023
Prague, Czech Republic
Research • Economy

Czech Real Estate Market View

A regular update on the commercial real estate market in Czech Republic.
Marie Baláčová • 27/04/2023

CAN'T FIND WHAT YOU'RE LOOKING FOR?

Get in touch with one of our professionals.
With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on Cookies
MORE OPTIONS
Agree and Close
These cookies ensure that our website performs as expected,for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All
Save settings