Czech Capitalism Blooms

June 20, 1994|By David Rocks | David Rocks,Special to The Sun

PRAGUE, CZEC REPUBLIC — PRAGUE, Czech Republic -- Czechs call their capital "Golden Prague" because of the scores of gilded steeples, spires and towers that loom over the city's medieval core. Foreigners coming here in recent years, though, see a different kind of gold along Prague's ancient cobblestone streets.

"Where there's change, there's opportunity," said Scott Otto, one of thousands of young foreign entrepreneurs to flock to Prague since the "Velvet Revolution" peacefully ended communism here 4 1/2 years ago. "When people hear of a part of the world that is newly opened to capitalism and entrepreneurship, they come."

During the four decades of communist rule in Prague, the Czech service and retail sectors were almost entirely nationalized. The result was a relatively small number of workshops and stores, virtually all of which provided substandard goods and services.

While many Czechs have started businesses and prospered over the past four years, thousands of young foreigners have also come to Prague to seek their fortune -- providing services that Czechs not only lacked but often didn't even know.

Now, these entrepreneurs -- most of them in their 20s and early 30s -- run restaurants, discos, laundromats, employment agencies, photocopy shops, bookstores, a mail-box rental and telephone answering business, stockbrokerages and real estate agencies.

"I think they've made a big impact," said Shelley Galbraith, a commercial counselor at the U.S. Embassy in Prague. "In some areas they're setting the standard, in some cases they're filling a niche for foreigners, and in other cases they're providing services exclusively for Czechs."

Compared to Paris of the 1920s and 1930s, Prague of the 1990s is filled with thousands of would-be Hemingways and Fitzgeralds coming here to write poetry, finish novels, and drink too much while waiting to be discovered.

These days, however, for every goatee, beret and backpack in Prague, there's also a pinstriped suit and Italian leather briefcase, not waiting for a rich publisher, but trying to become one. Or at least feed them lunch.

Hannelore Breitmeyer Jones, a 26-year-old Houston native, moved here to open the city's first -- and to date, only -- Cajun restaurant. The restaurant, Red, Hot & Blues, is a popular lunch spot for Prague's foreign business community.

Although Ms. Breitmeyer Jones had no restaurant experience before she came, she knew exactly what she wanted to do before arriving -- and has created one of the city's most successful eateries.

"I thought I'd go where there was growth and promise. I picked Prague because it had the best economic potential," said Ms. xTC Breitmeyer Jones. "I chose the place, I chose the time, I chose the industry. There was no good place to eat here."

While no one is keeping track of exactly how many foreigners have come to Prague, their impact can be seen almost immediately on arrival. Three English-language newspapers, an English literary review, a French-English magazine and a handful of titles in other languages have been started by enterprising expatriates.

Many of the city's best restaurants are foreign-owned or managed. And every week, new foreign-run businesses open their doors in pursuit of their share of Prague's pot of gold. Mr. Otto, for example, left his job with the accounting firm Ernst & Young three years ago to cash in on Prague's opportunities. He hit on the idea of opening a sports bar, modeled on a favorite haunt of his on Upper Broadway in New York City.

Now Czechs and expatriates alike can watch soccer, hockey, basketball and American football on three big-screen TVs while quaffing mugs of Czech beer or sipping mixed drinks with names like Slap Shot, Slam Dunk and Curve Ball.

"Prague is an outlet for entrepreneurial energies," said Mr. Otto, 32. Dany Himi, a 30-year-old native of Israel, came to Prague in August 1991 because a friend said he knew of a shop for rent. Although Mr. Himi had no previous connection to the country, he liked the shop, rented it and started selling jeans, T-shirts and inexpensive clothes he bought cheaply in Germany.

Now, he operates one of the largest retail chains in the region, with 25 "Himi's Jeans" stores in the Czech and Slovak republics employing 800 people.

"My success is that I was here first, I worked fast, I took the best places very fast," Mr. Himi said.

He was also among the first in the country to rethink socialist concepts of retailing. In contrast to old state stores, where customers had to line up at a counter until a salesperson would hand over a shirt or a pair of jeans for inspection, Mr. Himi's stores display all their merchandise on open shelves and a half-dozen young salespeople are on hand to help customers.

"Textiles have to be touched," Mr. Himi said. "For the first one or two years," he said, "people were afraid to touch the goods" in his stores.

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