Incentives don't matter

ODS Chairman Václav Klaus wrote in Hospodářské noviny today that major international companies don't make investment decisions based on the incentives offered by a government. They would invest in the CR even without tax breaks or other incentives, he said, as long as their projects were efficient and profitable in the first place. The only reason for having incentives, he argued, is so that the cabinet can declare a political success when an investor chooses the CR. He said that claims by CzechInvest about how it has attracted $5.7bn in foreign investment since 1993 are misinformation designed to show how useful and important the promotion agency is. As part of its election campaign, ODS has promised to reduce bureaucracy. Klaus' words today suggest that CzechInvest might be one of the first targets of his anti-bureaucracy axe.