During the 1990s, the Czech Republic experienced a drastic shift away from the industry sector and towards the services sector. This change resulted partly from the Czechoslovak split, and partly from the transformation to a market-based system. The communist system created several large monopoly industries, particularly in large machine manufacturing. Once privatized, only some of these industries were actually competitive in a free-market environment. Moreover, while the service sector was given a low priority under the communist system, the free-market environment demonstrated a strong demand for services.
Foreign direct investment (FDI) in Czech companies has been crucial to their successful transition, and the Czech Republic has benefited from high FDI levels. Some of the most famous Czech companies that have successfully survived the transition process are the Škoda