23rd January 2015

Competitiveness: Czech economy outlook for 2015 (and review of 2014)

On Thursday 22nd January 2015 the Czech Banking Association published its economic outlook for the Czech economy for the year 2015. This outlook is updated and published quarterly and it is comprised of contributions of Raiffeisenbank, ČSOB, GE Money Bank, UniCredit Bank, Česká spořitelna, J&T Banka, Komerční banka and ING Bank analysts. This outlook foresaw the economic growth for Czech economy to reach the rate of 2.4 % that is slightly better compared to last year’s outlook of 2.3% growth. Despite certain fears of various risks and challenges that were mostly of geopolitical nature (cheaper oil, Ukraine, Russia) the Czech economy in 2014 performed well and was maybe a bit surprisingly pulled by domestic demand rather than by net export. Main components of domestic economic growth were investment that contributed to the growth with 1 % and household consumption with more than 0.5 %. Despite higher percentage of investment the amount of loans that were taken to finance the investments remained lower as most of the companies used their own resources to invest. The situation of Czech economy in 2014 forms a good starting point for companies expectations for the year 2015 as the percentage of CEOs that are afraid of bad future development of Czech economy dropped from nearly 33 % to 14 % (according to the PwC survey). Also partial sector development contributes to this optimistic outlook as the secondary sector of Czech economy plays more significant role than before as the companies strive to build the impression of Czech industry as strong, growing and innovative.

Members of the American Chamber of Commerce in the Czech Republic