3rd August 2014

Competitiveness: Czech economy is to grow faster

According to the newest prediction of Ministry of Finance the Czech economy in theyear 2014 should grow by 2.7 %. That is 1 % higher than its previous estimate and it is mainly affected by real economic growth of 0.8 % in the first quarter of this year. According to the Ministry this was caused by temporary effects such as extraordinary mild winter, better use of European money or stronger export influenced by the weakening crown. Despite this and despite the Czech National Bank intervention the inflation should grow only by 0.6 % which is well below the targeted 2 % level. In 2014 the Czech GDP should continue to rise by 2.5 % and is to be determined from 75 % by the domestic demand and by 25 % by the balance of trade. Also the prediction of unemployment is improved from 6.8 % to 6.4 % for 2014 and from 6.6 % to 6.1 % for 2015. It is the same with the amount of salaries and wages that are to grow by 2.8 % instead of 1.8 % this year and by 3.8 % instead of 3.5 % next year.

Also the standard of living compared to other European countries should grow according to the newest Ministry of Finance economic estimate. The Czech Republic should attain 75 % of the GDP according to the PPP compared with the old 12 European countries. It should be better than Slovakia, Poland or Hungary but slightly worse than Slovenie with its 76 %. Youngest member of the EU Croatia should attain 55 % this year.

For more click here, here, here and here.

Members of the American Chamber of Commerce in the Czech Republic