PATHS TOWARDS
AN ADVANCED CZECHIA
Czechia as a leader in the global transformed economy
This joint declaration is the first time that an alliance of business, expert and non-profit organizations has come together to clearly declare that the changing global and European economy presents unprecedented opportunities for the Czech economy. Now is the time to start working together to remove barriers and create clear conditions for investors. Private sector finance is ready to support our country's economic transformation, all that remains is political support.
Our goal is to build a Czech economy that is at the forefront of global economic transformation, not only because it is beneficial for the Czech Republic. As the pragmatic best solution for the Czech Republic, we want an economy that meets the criteria listed below. To fulfill them, we recommend focusing on implementing the following steps, which are based on respected studies or work with recommendations from Enrico Letta's reports published this year [1] and Mario Draghi [2] .
Rational and modern energy for Czechia
Support for the development of a modern and sustainable energy mix in accordance with the Czech Republic's European and international commitments, which will ensure reliable electricity supplies for the competitiveness of the Czech economy by reducing costs and enabling investments in accordance with ESG criteria. The share of renewable energy sources (OZE), in particular solar and wind energy, in total consumption should be 30% by 2030 according to the current version of the National Climate and Energy Plans (NKEP) [3] . For such development , the following obstacles in particular need to be removed:
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Modernizing the transmission and distribution system and preparing it for a modern energy system is key not only for the further development of renewable sources.
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Acceleration of permitting processes for wind and solar power plants [4] and construction of transmission and distribution systems, including approval and use of acceleration zones.
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Development of smart grids, accelerating the roll-out of smart metering, effective management of the electricity system, tightening key legislation for development and investment in storage technologies and flexibility aggregation.
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Appropriate setting of investment and operations support (PPAs, Contracts for Difference, capacity payments, and others) to support the modernization of the Czech energy sector.
Rational exit from coal and rejection of subsidies or other non-market forms of support for the operation of old, emission-intensive power plants; use of available public and private funds for the modernization of the energy sector, partial conversion of coal-fired power plants to gas-fired or for the development of renewable sources and smart grids.
Modernizing the heating industry and ensuring a sustainable economic transformation of building heating through:
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development of combined heat and power generation (CHP, cogeneration)
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support for research, production and installation of heat pump technology [5]
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support for renewable heating sources
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research into other potential solutions in the field of heating, e.g. heat storage, solar thermal, geothermal technologies.
Investments in reducing the energy consumption of households and companies, with an emphasis on helping vulnerable entities with energy prices.
Enabling maximum use of the benefits of electricity sharing through soft and investment support, infrastructure availability and tariff setting. Involving new players — households, small businesses and local governments — in the energy sector [6] .
Development of production and use of green hydrogen with regard to demand, analysis of industry needs and ensuring partial domestic production of green hydrogen (hydrogen "alleys") with priority on safe import from geopolitically stable countries, focus on the use of hydrogen for industry and accumulation, with a pragmatic approach.
Landscape as an indicator of a healthy economy
Ensuring the healthy functioning of natural ecosystems, as they are also essential for the economy. Let's support the analysis of the impacts of the destruction of natural ecosystems on the Czech economy, as we do not have enough local analyses and data available.
Purposeful and planned restoration of biodiversity through a well-thought-out system of scattered small biotopes, such as landscape elements in productive agricultural and forest landscapes.
Stopping financially and materially demanding soil erosion, creating a landscape resistant to increasing weather extremes.
Prioritizing the provision of public services (water retention, etc.) primarily on state land and new models of supporting these goals on private land.
Development of modern methods of farming on agricultural land and in forests, including advisory and other support, support for innovative economic practices focused on sustainability and gaining competitive advantage (FSC forest certification, regenerative agriculture, precision farming, organic farming, digitalization, data, AI).
Supporting farmers and foresters in the transition to more sustainable farming and better use of available financial resources (e.g. from the Common Agricultural Policy), including advice and involvement of capital investments.
Creating a resilient food system through diversification of agricultural production that ensures stability of supply and resilience to climate risks.
Optimizing resources through better use of land and water and reducing the burden on ecosystems, thereby strengthening the long-term productivity of the landscape.
A paradigm shift so that healthy landscapes and nature are understood as a long-term source of prosperity.
Resource efficiency
Supporting the implementation of circular business models in the manufacturing industry that mitigate impacts throughout the entire life cycle (LCA) of products, apply ecodesign principles and “product as a service” concepts, use recycled or renewable resources, and reduce emissions from production inputs.
Reducing the material intensity of construction by supporting the renovation of the existing building stock, activating uninhabited or unused buildings [7] and policies and tools enabling the application of circular building design in practice (modularity, reuse, digitalization, material cadastres) [8] .
Strengthening the circular economy system, with an emphasis on waste prevention across sectors, including recycling and producer responsibility for their products in other product categories, and setting up a functioning market for secondary raw materials.
Reducing import dependence on China, both in raw materials and key technologies.
Research, development and innovation as the engine of an advanced economy
Reform of the system of research, development and innovation (R&D&I) in the Czech Republic and reform of the management of research institutions, especially universities, with a reassessment of the role of peer reviews, funding of renowned foreign chairs and involvement of multidisciplinary approaches. The aim of the R&D&I support policy should be the emergence of innovations and their commercialisation in Europe and the Czech Republic in order to increase our competitiveness in global markets.
Emphasis on the applicability of research, including bonuses and the creation of specific support tools for its transfer into practice, while supporting basic research as a prerequisite for applied research.
Efficient spending of public money on impactful, disruptive types of innovation and on research at the level of global excellence, focusing grants on excellence and specific societal challenges, and reducing the administrative burden of R&D&I funding.
To promote greater involvement of the private sector and capital investors, to improve the linking of innovative companies and start-ups with research organisations, including universities, for example in the form of innovation clusters, in order to accelerate the introduction of innovative ideas into the Czech economy and maintain its competitiveness on the European and global market. Other examples of initiatives to increase private capital for R&D are also given in the Draghi report.
Supporting the building of disruptive and innovative companies and start-ups through targeted support for projects in clearly defined sectors where there is potential for large-scale development, following the example of the Technology Incubation project. Focusing on areas where we can offer added value to the Czech Republic and where this support will have the greatest impact (e.g. AI, EcoTech, Ecodesign, GreenTech, HealthTech, Space industry, advanced materials, nanomaterials, DeepTech, ...)
Raising the level of education and intensive reskilling and upskilling of adults, ensuring effective reallocation of the workforce to promising fields.
Promoting researcher mobility and interdisciplinary solutions through professional doctorates and sabbaticals, harmonisation of labour law processes across institutions.
Policy-making based on current scientific knowledge.
New business models for the Czech Republic
Approval, achievement and regular evaluation of a clear and long-term policy framework including rational industrial, energy and climate strategies (including the NKEP, State Energy Concept, Climate Protection Policy) with regard to international and European commitments, ensuring effective implementation of economic transformation policies by ensuring that the various ministries work closely together and act in accordance with a unified plan[9,10].
Comply with and actively implement the European commitment to achieve climate neutrality to ensure the long-term stability of the Czech and global economy, reducing the energy, material and emissions intensity of GDP while maintaining or growing GDP.
Supporting business focused on the production of non-zero technologies, including the identification of relevant industries[11] including engineering, creating business opportunities for innovative and environmentally friendly firms in the value chains of large enterprises. Supporting the development and production of advanced technologies such as batteries, heat pumps and renewable energy components.
Strategic support for the decarbonisation of emission-intensive industry:
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Cement and steel: electrification, use of geological CO2 storage, import of green hydrogen, and support for investment, innovation and development of infrastructure for collection and quality processing of secondary raw materials[12] (steel scrap, construction and demolition waste, industrial by-products)
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Construction: Promotion of recycled and other climate-friendly building materials (e.g. wood and other renewable building materials from sustainable sources, low-emission concrete, etc.), including the removal of regulatory barriers to large-scale use and their prioritisation in construction procurement criteria. Focus on whole life cycle assessment of buildings and application of circular construction principles[13].
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Petrochemicals: Reducing energy intensity, use of cogeneration and transition to renewables, recycling of plastics and transition to advanced biofuels, promoting hydrogen, mapping the potential for using mined oil for CO2 storage.
Customer health as a priority in the transition to more sustainable and safer products and services.
Encouraging entrepreneurship and ensuring a fair benefit from foreign investment by creating a tax and business environment that motivates the establishment of new innovative companies in the Czech Republic, not abroad (e.g. the so-called ESOP), while attracting foreign investors to the Czech Republic and to pay taxes there. Setting up an environment for reinvesting profits in our territory.
Supporting companies in collecting data on their environmental and social impacts to achieve better interest rates and be competitive for foreign investors and B2B partners with high CSR standards.
Piloting carbon capture and storage (CCS) technologies, identifying suitable sites and setting up support measures to make CCS an economically viable sector, while emphasising emissions prevention as the primary tool for decarbonisation.
Following Mario Draghi's recommendation, we support policies aimed at leveraging private capital within the EU to significantly increase investment in strategic areas such as green transition or decarbonised infrastructure. This is also linked to lowering costs for investors and diversifying sources of financing for companies outside the traditional banking sector.
Emphasis on gender equality in access to new job opportunities associated with the transition to sustainable technologies, leveraging the high educational attainment of women in the Czech Republic and supporting their increased participation in the economy.
Engaging regions in the new economic reality
Rural transformation and investment in regional infrastructure, comprehensive transformation and administrative consolidation of rural areas with a focus on public services (medical care, education), transport and infrastructure. Development of efficient public transport networks in small municipalities to address transport poverty and improve accessibility. Ensuring equitable distribution of the outputs of the green transformation, including fairer and more incentive-based budgeting of taxes.
Building high-speed rail (VRT), developing modern transport infrastructure to support economic growth, connecting regions and reducing emissions.
Construction and modernisation of the motorway network, investment in the expansion and improvement of motorway infrastructure to improve transport accessibility between regions, support economic growth and reduce congestion.
Promoting sustainable urban mobility through the development of public transport, cycle routes and pedestrian zones. Improving infrastructure in peri-urban areas to reduce traffic congestion and improve the quality of life of residents.
Support the development of infrastructure necessary for the development of a modern and digital economy, such as fibre optic networks.
Signatories of the declaration
This declaration was supported by the following signatures:
Aliance pro energetickou soběstačnost
Asociace pro využití tepelných čerpadel
Business Leaders Forum
Czech Business Council for Sustainable Development (Česká podnikatelská rada pro udržitelný rozvoj)*
Fakta o klimatu
Hnutí Duha
Institut cirkulární ekonomiky (INCIEN)
Red Button Network
Středočeské inovační centrum
cats2cats (EWA - Empowering Women in Agrifood)
Česká federace nábytkových bank a re-use center
Asociace glampingu a malého bydlení
Asociace udržitelného podnikání
Climate & Sustainable Leaders Czech Republic
Czech Founders
Frank Bold
IDG Czechia Changemakers Network
Jihomoravské inovační centrum
Solární asociace
Změna k lepšímu
prg.ai
Člověk v tísni
Autonapůl
Brenowa
CSRD.cz
ING Česká republika
Kokoza
RetroVintage
Tilia Impact Ventures
Baby Office
CEDA Maps
Carboneg
Impact Hub
Omnicom Media Group
Sázíme stromy
* Czech BCSD along with the signature added a recommendation
Supporters
2. ekonomická transformace
We are pleased that the declaration, which emerged from a discussion among NGOs, business associations and representatives of the authorities, includes many of the objectives promoted by the 2nd Economic Transformation Initiative - in particular, greater support for innovation, access to capital for companies in the Czech Republic and the use of global decarbonisation rationally and effectively for the growth of the Czech economy. We are happy to support joint efforts to promote these themes.
Aliance pro bezemisní budoucnost
Aliance pro bezemisní budoucnost very much welcomes and supports the creation of this document, while identifying with the basic tenets of the call. At the same time, it sees the need to elaborate and deliver a more detailed roadmap under the section 'Strategic support for decarbonisation of emission-intensive industry'. It therefore commits itself to working together on concrete solutions and a plan for the sector and will actively support the call.
TAH - Centre for Innovations in Technology, Art, and Humanities
TAH - Centre for Innovations in Technology, Art, and Humanities intends to work with the signatories of this document to develop laws, legislation and public policies that harness the potential of new technologies in conjunction with the arts, humanities and social sciences. The aim is to provide comprehensive and sustainable solutions to global challenges with positive impacts on society, the economy and the living environment.
Sources
[1] Enrico Letta - Much more than a market (zpráva, 4/2024)
[2] Mario Draghi - The future of European competitiveness (zpráva, 9/2024)
[3] Oldřich Sklenář - Fotovoltaický průmysl a evropská importní závislost (factsheet, 1/2024)
[4] Fakta o klimatu - Cesty k čisté a levné elektřině (studie, 6/2024)
[5] Oldřich Sklenář - Zpoplatnění emisí z paliv pro dopravu a vytápění (factsheet, 9/2024)
[6] Kristina Zindulková - Komunitní energetika a energetická chudoba (paper, 2/2024)
[7] MMR - Struktura neobydlených bytů v Česku a nástroje pro jejich aktivaci využívané v zemích OECD (studie, 12/2023)
[8] INCIEN - Stavebnictví: Zpomalení materiálových toků díky cirkulárnímu designu a prodloužení životnosti budov (paper, 10/2023)
[9] Martin Abel - Zelená transformace: proč Česko nemá plán? (paper, 8/2024)
[10] Kristina Zindulková - 2040 climate target for Czechia: current policy, ambition gap and sectoral analysis (paper, 6/2024)
[11] 2. ekonomická transformace - Mapa příležitostí (analýza, 10/2024)
[13] INCIEN - Snižování emisí CO2 během životního cyklu budov v České republice (studie, 10/2024)
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