Economic Trends/Outlook in the Czech Republic
The Czech Republic's economy is one of the most developed in Central and Eastern Europe. Its economic growth is strongly influenced by the demand on exports and foreign direct investment inflow. The country’s GNP growth which was increasing steadily over the past few years, experienced a strong drop in 2009 (-4.2%) due to the global recession. The growth rate became positive again in 2010, stimulated by exports which shows that the Czech Republic's economy is in full expansion and that its basis is becoming solid. The growth rate is estimated at 2% in 2010 and it should become stronger in 2011.
Inflation remained under control but the public funds decreased and the budgetary deficit became larger. In the context of the economic revival, the government has announced a program to reorganize its public finance for 2011. Severe measures have already been taken in order to reduce expenditures (suppression of subsidies, freeze salaries, etc.) and to increase the revenues. The objective is to bring the public deficit to 3% of the GDP by 2013, with the idea of meeting the Maastricht's requirements for the adoption of the Euro as its currency.
The unemployment rate increased under the effect of the global crisis and it remained stable at 8% of the active population.
|GDP (billions USD)||190.20||192.15e||218.36e||238.61e||260.28e|
|GDP (Constant Prices, Annual % Change)||-4.1||2.3e||1.7e||2.9e||2.9e|
|GDP per Capita (USD)||18,171||18,288e||20,738e||22,610e||24,613e|
|General Government Balance (in % of GDP)||-4.2e||-3.8e||-2.8e||-3.0e||-3.2e|
|General Government Gross Debt (in % of GDP)||35.4e||39.6e||41.7e||43.4e||44.5e|
|Inflation Rate (%)||1.0||1.5e||2.0e||2.0e||2.0e|
|Unemployment Rate (% of the Labor Force)||6.7||7.3e||7.1e||6.9e||6.5e|
|Current Account (billions USD)||-1.94e||-3.40e||-5.07e||-6.28e||-|
|Current Account (in % of GDP)||-1.0e||-1.7e||-2.4e||-2.7e||-|
Source: IMF - World Economic Outlook Database
Note: (e) Estimated Data
Main Sectors of Industry
The agricultural sector went through a serious crisis in the 90s and, even today, it is still heavily subsidized. It generates approximately 2% of the country’s GNP and employs more than 3% of the active population. The main agricultural products are sugar beets, potatoes, wheat, barley and hops.
The production sector is mostly private, it accounts for almost 40% of the GNP and employs 40% of the active population. The growth at the level of performance was parallel to the increase in manpower's productivity. One of the main manufacturing sectors is the auto industry, with Skoda (Volkswagen company). Foreign investors such as Toyota and PSA also started producing cars in the Czech Republic since 2005. However, this sector has now reached a saturation point. Nearly 10,000 jobs were eliminated in 2009 because of the international crisis. The textile sector is becoming very dynamic.
Services contribute to 60% of the GDP and employ more than half of the active population. The tourism sector is booming, thanks to the city of Prague, in particular, which is a very attractive tourist center.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||3.3||40.5||56.1|
|Value Added (in % of GDP)||2.3||37.2||60.5|
|Value Added (Annual % Change)||5.0||-13.1||1.5|
Source: World Bank - Last Available Data.
Indicator of Economic Freedom
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Sources of General Economic Information
Ministry of Agriculture
Ministry of Foreign Affairs
Ministry of Industry and Trade
Ministry of Finance
- Statistical Office
Czech National Statistical Office
- Central Bank
Czech National Bank
- Stock Exchange
Prague Stock Exchange
Czech capital market association
- Other Useful Resources
Czech Republic, Official website of the Czech Republic
- Main Online Newspapers
Lidové Noviny ( in Czech only ), daily
Hospodárské noviny (in Czech only), daily
MF DNES (in Czech only), daily
Právo (in Czech only), daily
EKONOM (in Czech only), weekly
The Prague Post
The Prague Tribune
Prague Business Journal
- Economic Portals
Czech Happenings, Czech Press Bureau (in Czech and in english)
Businessinfo.cz, Czech business web portal
Financni Noviny, News in English
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Thanks to the revival of exports and robust restocking, the Czech Republic resumed growth in the last two years (2.7% in 2010 and 1.7% in 2011).
Hong Kong Trade Development Council (HKTDC) on 30 Jul 2012 related to Economic Trends/Outlook in the Czech Republic
Thanks to the revival of exports and robust restocking, the Czech Republic resumed GDP growth of 2.3% in 2010, after a 4.1% decline in the recession year 2009.
Hong Kong Trade Development Council (HKTDC) on 27 Sep 2011 related to Economic Trends/Outlook in the Czech Republic
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Government Trade Promotion, Hong Kong SAR