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Teritoriální projekt pobaltí


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Teritoriální projekt pobaltí

  1. 1. Czech Republic YOUR TRADE PARTNER 2010/2011 Estonia, Latvia, Lithuania C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 1
  2. 2. ECONOMICS AŽD Praha Rail Transportation Road Transportation Telecommunications Traditional Czech supplier of modern control and signalling systems Safely to your destination 2 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  3. 3. CZECH REPUBLIC - YOUR TRADE PARTNER Compiled by PP Agency, s.r.o. in cooperation with Ministry of Industry and Trade Ministry of Foreign Affairs Confederation of Industry of the Czech Republic Czech Chamber of Commerce Confederation of Employers’ and Entrepreneurs’ Associations of the Czech Republic CzechTrade CzechInvest CzechTourism Czech Centres Centre for Regional Development of the Czech Republic Export Guarantee and Insurance Corporation Czech Export Bank Deadline: 12 January 2010 ® Teritoriální publikace Česká republika – Váš obchodní partner © Published by the PP Agency s.r.o. Myslíkova 25, 110 00 Praha 1, Czech Republic Phone: +420 221 406 622; e-mail:; A company with the ISO 9001 certified quality management system for publishing services C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 3
  4. 4. FOREWORD Contents Foreword by Mr Alexandr Langer, Ambassador of the Czech Republic to the Republic of Estonia 5 Foreword by Mr Tomáš Pštross, Ambassador of the Czech Republic to the Republic of Latvia 6 Foreword by Mr Radek Pech, Ambassador of the Czech Republic to the Republic of Lithuania 7 FOREWORD Czech Exporters 8 Useful Information 10 ECONOMICS Czech Economy in 2008 and 2009 13 Czech-Estonian Trade and Economic Relations 16 Czech-Latvian Trade and Economic Relations 18 Czech-Lithuanian Trade and Economic Relations 20 Smaller Projects, Advanced Technologies 22 Road Toll in the Czech Republic 25 Photo: CzechTourism, Ministry of Foreign Affairs archives; Cover photo: Škoda Auto and Škoda Electric archives, CzechTourism, PhotoCombo, Czech Republic – Member of the Schengen Area 25 BUSINESS IN THE CZECH REPUBLIC Legal Framework for Doing Business in the CR 27 How to Set Up a Company 31 Why Invest in the Czech Republic? 34 Registration and Tax Liabilities 35 The Tax System 36 EU Citizens not Required to Obtain Work Permits 38 Come and Discover the CR 40 INSTITUTIONS Confederation of Industry of the Czech Republic 42 Czech Chamber of Commerce 42 Export Guarantee and Insurance Corporation 43 Czech Centres 43 CzechInvest - the Investment and Business Development Agency 43 Centre for Regional Development of the CR 44 Czech Trade Promotion Agency/CzechTrade 44 Confederation of Employers’ and Entrepreneurs’ Associations of the Czech Republic 45 Czech Export Bank 46 Czech Tourist Authority – CzechTourism 46 CONTACTS Useful Addresses in the Czech Republic 48 Useful Contacts in the Republic of Estonia 48 Useful Contacts in the Republic of Latvia 48 Useful Contacts in the Republic of Lithuania 48 Prague, the Dancing House (it placed first in the Design category of a survey organised by the American Time magazine) The Most Important Websites 50 4 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  5. 5. The economies of the Czech Republic and the Republic of Estonia have much in common: because of their limited domestic markets both countries are export-oriented, both have undergone radical transformation and switched over to market economy principles, both moved quickly to the EU markets and until 2008 showed a rapid GDP growth. Czech goods and services are for sure not unknown in Estonia: ŠKODA AUTO, ČSA, Czech tramcars, beer, and other food products certainly need no introduction. Since the establishment of the Czech Republic in 1993, Czech-Estonian trade turnover increased 22 fold and in 2007 amounted to EUR 178.6 million. The depend- ence of both economies on exports and the decline in the absorption capacity of their largest foreign buyers of goods and services led to the decline in the performance of the economies of both countries. Currently we can see that the consequences of the world economic crisis are being successfully overcome and that the activities on both the domestic and international markets are gradually regaining their previous strength. In the Czech Republic, we are impressed by the steadfastness shown by Estonia in its efforts to meet the Maastricht criteria so as to be able to enter the Eurozone at the beginning of 2011. Both economies are trying to take advantage of any positive effects the past crisis has brought. It seems that one such positive effect is the growth of the share of the knowledge economy in the countries’ economic systems (not all users of the popular Internet product Skype know that it has its roots in Estonia). Statistics clearly show a growing share of IT technologies in the total volume of investments made in 2009. Another effect is the lesson we learned about the need for diversification – it is good to have customers on the EU market, but it would be a pity to abandon for them the positions gained with pain on third markets (we are following the activi- ties of Czech and Estonian businessmen, for example in Southeast Asia). This naturally brings to mind the idea of possible co-operation of Czech and Estonian companies on those markets, so far practically unaffected by the economic crisis. Czech-Estonian relations have deep roots. In this connection, let us mention, for example, the disciples of J. A. Comenius, who propa- gated his work in Tartu in the 17th century, or the Czech writer, literary scientist and critic Vladimír Macura, who initiated and was one of the founding members of the Baltic Union, an underground organisation at the time of the communist dictatorship associating friends of the Baltic nations and their countries occupied by the Soviet Union (predecessor of today’s Czech- Estonian Club), which operated in the former Czechoslovakia since the mid-1970s. Today, the Czech Republic and Estonia are close allies in a number of international organisations, such as the European Union and the North Atlantic Alliance. Our nations must communicate inten- sively with each other, and trade is one of the forms of communication, which, in addition, has the capability of accelerating communication at all other levels – political, cultural, tourist, etc. Without any attempt at simplification, it does not seem to be accidental that the rapid growth of mutual trade is accompanied by a growing mutual flow of tourists. Our countries are close to each other both politically and geographically, as there are direct flights connecting Tallinn and Prague operated by ČSA. To link the Czech Republic and Estonia by road more comfort- ably, it will be necessary to solve certain problems, but this in no way denies the great potential that exists for the promotion of mutual economic links. Recently we have been witnessing the emancipation of the regions of our two countries. In the past six months alone, the South Bohemia and the South Moravia Regions presented themselves at the Embassy of the Czech Republic in Tallinn. Similar activities can also be observed on the Estonian side. As a representative of the Czech Republic in Estonia, I wish your publication Czech Republic – Your Trade Partner the best of success in the presentation of the Czech Republic and in fur- thering information about our countries’ mutual co-operation potential in business, produc- tion, and investment. Alexandr Langer Ambassador of the Czech Republic to the Republic of Estonia C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 5
  6. 6. FOREWORD I welcome the opportunity of presenting in this, already traditional, way the sphere of Czech-Latvian trade and economic relations. As shown by the statistics, trade between the Czech Republic and the Republic of Latvia followed an upward trend until the end of 2008. In 2009, however, the Latvian economy experienced difficulties, moreover aggravated by the global financial crisis and economic recession. Today, Latvia is striving to combat the serious impact of the situation, so it is no wonder that the growth curve of our mutu- al trade has changed its course. A number of traditional exporters of Czech products to Latvia are faced with serious sales difficulties, with the solvency of our customers and the purchasing power of the population, used to buying the well-established products of the Czech consumer industry, having declined substantially. The same applies to investment deliveries, as a result of which some of the planned joint technical projects had to be postponed. The total volume of our exports in 2009 is estimated to have dropped by more than one-fourth. In the opposite direction, i.e. in the category of Latvian exports to the Czech Republic, the situation is slightly better; imports, however, have always played a relatively small role in our mutual trade exchange. Despite these unfavourable circumstances, Czech products have an excellent record in Latvia and, in addition, their popularity in a cer- tain sense reflects the Latvian affection for our nation. Although this publication concerns exclusively economic matters, it is proper to recall the tremendous popularity of our culture in Latvia. It would be a great pity to lose anything of that potential. As regards the economic situation, I am confident that our trade exchange will soon be back on the old track. In this respect, I am optimistic and know that it is just a matter of time. Until then I consider it correct to maintain the positions in this pleasant Baltic country and be prepared to resume dynamic activities on the Latvian market. Although small in terms of the country’s population, this market is relatively important from the point of view of Latvia as a country at the crossroads of the European transit routes, with an advan- ced infrastructure of its ports. It is a strongly competitive market, where the greatest players are Latvia’s neighbours and countries of the European North. So far, however, we have stood our ground in this competition, and I am confident that nothing will change about it in future. Tomáš Pštross Ambassador of the Czech Republic to the Republic of Latvia Photo: Ministry of Foreign Affairs archives 6 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  7. 7. I am pleased to have the opportunity to address the readers of the publication “Czech Republic - Your Trade Partner” from Vilnius, the capital of Lithuania. Czech-Lithuanian relationship is historically very fruitful in both economic and all-round area. Following our commercial relations during almost last twenty years, we can see continual increase of mutual business turnover with an exception due to global economic crisis since the fourth quarter of the year 2008. But this is a strong challenge to fight the downturn and to go back to the economic growth. The real milestone was definitely the year 2004 – the accession to the EU opened up the possibility for a qualitatively higher level of our co-operation. Additionally, Lithuania became 2004 a member of NATO. As relations between our countries have no political or other problems, trade exchange and other forms of econ- omic co-operation are thus coming increasingly to the forefront of the common interests between Lithuanians and Czechs. Bilateral contacts between the Czech Republic and the Republic of Lithuania are very intensive, stemming primarily from the traditionally friendly relations between the two countries. The first written records of Czech -Lithuanian relations can be found in a document dating back to the year 1397, when a Lithuanian college was founded at Prague University. Jan Žižka took part in the Battle of Tannenberg (Žal- giris-Grűnwald) alongside with the Lithuanian Grand Duke Vytautas the Great in 1410. In the 19th century the Czech national movement gave impetus to the Lithuanian national uprising and the Czech letters of ž,č,š found their way to the Lithuanian alphabet. Czechoslovakia was one of the first states which recognised the independent Lithuania on 5 January 1922. With the exception of the forcible break between 1939 and 1990, the Czech Republic and Lithuania have had very active diplo- matic relations. We will celebrate 19th anniversary of re-established diplomatic relations on the 9th September 2010. An important part of the work of the Czech Embassy in the Republic of Lithuania is economic diplomacy and the support of an export-oriented policy. In co-operation with represen- tatives of the Czech Trade Agency we are creating favourable conditions particularly for small and medium-sized businesses to assert themselves in the Lithuanian market. Lithuania has traditionally been the Czech Republic’s largest trade partner among the Baltic states. In 2008, the mutual trade kept the last year’s level, and it reached more than EUR 424 million. In 2009, it seems to be worse. The turnover has lowered about 36% during three quarters of this year. The Embassy of the Czech Republic, however, does not limit itself to just one-way commodity trading; with the help of lectures, the presentation of plans and the participation of Czech firms in trade fairs and exhibitions we are trying to support bilateral entrepreneurial activities. We are strengthening the cooperation with our government organisation Czech Trade Agency to support Czech-Lithuanian business activities. More and more Lithuanians visit our country as tourists and businessmen. We want to promote our country as a good place for a holiday, a good exhibition site and as one of the most important congress centres in Europe in contemporary crisis situation particularly. In the year 2010, we shall focus on: l monitoring large investment projects, especially in energetic and transport systems and passing on information to Czech businessmen and entrepreneurs so as to enable them to prepare for parti- cipation in public tenders; l the study of distribution channels and the flow of commodities, passing on of information to Czech firms wishing to enter the Lithuanian market, in close cooperation with the local office of the Czech Trade Agency; l effort of our countries in overcoming the present economic downturn. As the representative of the Czech Republic in Lithuania, I hope for the greatest success in mutual relations, in business and enterprise. Radek Pech Ambassador of the Czech Republic to the Republic of Lithuania C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 7
  8. 8. FOREWORD Czech Exporters Czech companies presenting their products in this publication wish to expand their exports and to have business partners in the Baltic states. The companies are listed by sector classification – NACE. 03.21 Marine aquaculture 27.90 Manufacture of other electrical equipment Josef Lonský - AQUA TROPIC 9 INGE Opava, spol. s r.o. 51 03.22 Freshwater aquaculture Elektro, výrobní družstvo v Bečově nad Teplou 26 Josef Lonský - AQUA TROPIC 9 28.21 Manufacture of ovens, furnaces, 10.92 Manufacture of prepared pet foods and furnace burners Josef Lonský - AQUA TROPIC 9 E-therm TZ s.r.o. 58 18.10 Printing and service activities related to printing 28.40 Manufacture of metal-forming machinery and machine Böttcher ČR , k.s. 12 tools 20.30 Manufacture of paints, varnishes and similar coatings, TOS VARNSDORF a.s. 47 printing ink and mastics 28.93 Manufacture of machinery for food, beverage, METRUM s.r.o. 15 and tobacco processing 20.42 Manufacture of perfumes and toilet preparations DESTILA, s.r.o. 49 GOLDEN LINE s.r.o. 39 J 4 s.r.o. 49 20.59 Manufacture of other chemical products n.e.c. 28.99 Manufacture of other special-purpose machinery n.e.c. GOLDEN LINE s.r.o. 39 E-therm TZ s.r.o. 58 22.10 Manufacture of rubber products J 4 s.r.o. 49 Böttcher ČR , k.s. 12 29.10 Manufacture of motor vehicles 22.21 Manufacture of plastic plates, sheets, tubes, and profiles SOR Libchavy spol. s r.o. 47 TERMOLUX, s.r.o. 29 30.20 Manufacture of railway locomotives and rolling stock 22.23 Manufacture of builders’ ware of plastic CZ LOKO, a.s. 55 TERMOLUX, s.r.o. 29 SaZ s.r.o. 54 22.29 Manufacture of other plastic products 30.99 Manufacture of other transport equipment n.e.c. OBZOR, výrobní družstvo Zlín 30 SaZ s.r.o. 54 23.42 Manufacture of ceramic sanitary fixtures 31.09 Manufacture of other furniture LE BON, spol. s r.o. 53 LE BON, spol. s r.o. 53 RIHO CZ, a.s. 52 RIHO CZ, a.s. 53 25.20 Manufacture of tanks, reservoirs, and containers of 33.17 Repair and maintenance of other transport equipment metal SaZ s.r.o. 54 DESTILA, s.r.o. 49 35.12 Transmission of electricity EURO TEPLO s.r.o. 33 KPB INTRA s.r.o. 56 HAAS + SOHN Rukov, s.r.o. 34 35.13 Distribution of electricity 25.29 Manufacture of other tanks, reservoirs, KPB INTRA s.r.o. 56 and containers of metal 46.14 Agents involved in the sale of machinery, industrial INTERO, Chmelan a spol., equipment, ships, and aircraft společnost s ručením omezeným 59 Jovbak s.r.o. 15 25.50 Forging, pressing, stamping, and roll-forming 46.45 Wholesale of perfume and cosmetics of metal; powder metallurgy GOLDEN LINE s.r.o. 39 OBZOR, výrobní družstvo Zlín 30 52.21 Service activities incidental to land transportation 25.99 Manufacture of other fabricated metal products n.e.c. AŽD Praha s.r.o. 2 EURO TEPLO s.r.o. 33 62.00 Computer programming, consultancy, and related 26.00 Manufacture of computer, electronic, activities and optical products Institut mikroelektronických aplikací s.r.o. 51 Institut mikroelektronických aplikací s.r.o. 51 64.11 Central banking 27.10 Manufacture of electric motors, generators, Česká exportní banka, a.s. 45 transformers, and electricity distribution and 64.99 Other financial service activities, except insurance and control apparatus pension funding n.e.c. AŽD Praha s.r.o. 2 Česká exportní banka, a.s. 45 27.12 Manufacture of electricity distribution 73.10 Advertising and control apparatus M.I.P. Advertising, a.s. 24 OBZOR, výrobní družstvo Zlín 30 74.90 Other professional, scientific, and technical activities n.e.c. Elektro, výrobní družstvo v Bečově nad Teplou 26 E-therm TZ s.r.o. 58 27.32 Manufacture of other electronic and electric 80.20 Security systems service activities wires and cables Institut mikroelektronických aplikací s.r.o. 51 KABELOVNA Děčín Podmokly, s.r.o. 57 86.10 Hospital activities 27.33 Manufacture of wiring devices Klinika plastické chirurgie EMOTIONS, s.r.o. 41 KABELOVNA Děčín Podmokly, s.r.o. 57 86.22 Specialist medical practice activities Elektro, výrobní družstvo v Bečově nad Teplou 26 Klinika plastické chirurgie EMOTIONS, s.r.o. 41 27.40 Manufacture of electric lighting equipment 96.02 Hairdressing and other beauty treatment INGE Opava, spol. s r.o. 51 Klinika plastické chirurgie EMOTIONS, s.r.o. 41 8 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  9. 9. THE RELIABLE PRODUCER EVEN FOR YOUR COMPANY AQUA TROPIC LONSKY K PEROVNE 740, 102 00 PRAHA 10, CZECH REPUBLIC Tel.: 272 702 880, Fax: 272 702 947 • e-mail: C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 9
  10. 10. FOREWORD Useful Information BASIC DATA struction and Development, the European Bank for Reconstruction Population 10 506 813 and Development, the OECD, as well as many other organisations. (31 December 2009) Area 78 864 UNESCO WORLD HERITAGE The capital city Praha (Prague) The UNESCO World Heritage List includes the following cities and System of government a republic sites: Prague, Český Krumlov, Kutná Hora, the Litomyšl Chateau, Language Czech Telč, the Lednice-Valtice area, Zelená Hora - St John of Nepomuk Highest peak Sněžka (Snow) Mountain Church, Holašovice, Kroměříž (chateau and gardens), the Holy (1602 m above sea level) Trinity Column in Olomouc, the Tugendhat Villa in Brno (designed Time zone Central European Time by architect Ludwig Mies van der Rohe), and St Procopius Basilica GMT + 1, summer time and the Jewish Cemetery in Třebíč. For more information, please see GMT + 2 Monetary unit 1 Czech crown (Kč/CZK) = 100 halers PROMINENT FIGURES Internet domain .cz The Czechs are described as a very cultural nation which has contributed to the world a large number of prominent figures. The The President of the Czech Republic is Václav most significant rulers and heads of state include emperor Charles Klaus. IV and presidents T. G. Masaryk, Edvard Beneš, and Václav Havel. Names of world renown include Jan Amos Komenský (Comenius) MEMBERSHIP OF ORGANISATIONS “the Teacher of Nations“, scientists Jaroslav Heyrovský (Nobel Prize Photo: CzechTourism The Czech Republic is a member of the laureate for chemistry), Otto Wichterle, a Czech chemist who European Union, the United invented contact lenses, and Antonín Holý Nations, NATO, the WTO, the Other useful information on the (professor of honour in medicinal chemist- International Monetary Fund, the Czech Republic is at ry), who discovered drugs against AIDS. International Bank for Recon- Famous people of culture include composers 10 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  11. 11. The Capital of Prague - the dominant Prague Castle State Symbols of the Czech Republic Large State Coat of Arms State Flag Czech Republic, a.s., T-Mobile Czech Republic a.s., Vodafone Czech Republic a.s., and Bedřich Smetana, Leoš Janáček, Antonín Dvořák, and Bohuslav MobilKom, a.s. Martinů, writers Franz Kafka, Karel Čapek, Jaroslav Seifert (Nobel The most commonly used credit cards in the Prize laureate), Jaroslav Hašek, Bohumil Hrabal, and Milan Kunde- Czech Republic are: Eurocard/MasterCard, ra. Winners of the American Academy Award are film directors Maestro, and Visa. Miloš Forman (born in former Czechoslovakia), Jiří Menzel, Jan Svěrák, and the singer Markéta Irglová. Painters to be named are THE BIGGEST CITIES František Kupka and Alfons Mucha. Athletes of world renown OF THE CZECH REPUBLIC include Emil Zátopek, Petr Čech, Jaromír Jágr, Dominik Hašek, city number of inhabitants Pavel Nedvěd, Jan Železný, Kateřina Neumannová, and many 1. Praha 1 180 100 others. Martina Navrátilová and Ivan Lendl are also of Czech origin. 2. Brno 366 000 The winners of gold medals at the 2008 Olympic Games in Beijing 3. Оstrava 310 000 were Kateřina Emmons, Barbora Špotáková, and David Kostelecký. 4. Plzeň 163 000 5. Оlomouc 100 000 PRACTICAL INFORMATION 6. Liberec 98 000 Country dialling code: +420. Details regarding phone numbers are 7. České Budějovice 95 000 available at the following website: 8. Ústí nad Labem 95 000 Licences to operate mobile phone networks in the Czech Republic 9. Hradec Králové 94 000 have been awarded to the following companies: Telefónica O2 10. Pardubice 88 000 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 11
  12. 12. ECONOMICS ■ Printing ● Roller coverings ● Printing chemicals ● Printing blankets Main supplier of rubber rollers for printing machines of the brands: HEIDELBERG, MAN-ROLAND, ADAST, KBA-PLANETA, KBA-GRAFITEC, WIFAG, GOSS, KOMORI, RYOBI ■ Sleeves ■ Escalator handrails ■ Rubber coverings for industrial rollers ■ Polyurethane application on the roller ■ Use of technical rollers: wrapping production, textile industry, steel industry, paper industry, tanning industry, plastic materials industry, furniture industry, chemical industry, food industry, electrical engineering, glass industry, mechanical engineering Böttcher ČR, k.s., Tovární 6, 682 01 Vyškov, Czech Republic, Phone: +420 517 326 521-5, Fax: +420 517 341 718 E-mail:, UAB "Bottcher Balticum", Radmes g. 3B, LT-82142, Radviliškis, Lithuania, Tel./Fax: +370 422 50 538, Mob.: +370 685 86 248 E-Mail: 12 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  13. 13. Czech Economy in 2008 and 2009 In 2008, and particularly in 2009, the world crisis manifested itself in Production declined in practically all sectors of a general decline in economic activities, the growth of unemploy- industry; the decline was especially noted in ment, and an increasing budget deficit. food and beverage production, the manufac- ture of tobacco products, textiles, clothing and GROSS DOMESTIC PRODUCT basic metals, and in metallurgy and metal- Economic growth, measured by the GDP growth rate, already slowed working. The rapid decline in industrial down significantly in 2008 in comparison with previous years. Year- production continued in all quarters of 2009, on-year, GDP rose by 2.3%, with growth rates in the individual when output dropped by 13.4% year-on-year, quarters slowing down steadily. GDP growth in 2008 mirrored the of which, 14.6% was in the manufacturing good nett export results in the first three quarters; in the 4th quarter, industry. just as in all four quarters of 2009, the effect was negative. In 2009, the volume of GDP dropped by 4.3% year-on-year: in the 1st quarter by FOREIGN TRADE 4.2%, in the 2nd by 4.7%, in the 3rd by 4.1% and in the 4th by 4.2%. The In 2009, for the first time in the history of the only item that mitigated the decline was final household and govern- independent Czech Republic, foreign trade*) ment spending. The influence of all other components was negative. saw a marked fall. While, in 2008, the foreign trade turnover was 0.2% up on the previous INDUSTRY year, in 2009 it was 16% down year-on-year. In 2008, industrial production was 1.9% below the 2007 level, mainly In 2009, exports were 13.9% lower in com- as a result of a rapid fall in the 4th quarter (by 86.4% year-on-year). parison with 2008 and imports were down by Macroeconomic indicators of the Czech Republic 2003 2004 2005 2006 2007 2008 7) 20097) Gross Domestic Product (current prices) CZK, billion 2 577.1 2 814.8 2 983.8 3 222.4 3 535.5 3 689.0 3 627.2 Gross Domestic Product %, real, y/y 3.6 4.5 6.3 6.8 6.1 2.5 -4.3 Gross Domestic Product in PPS 1) PPS/inhab. 15 215.0 16 262.0 17 058.0 18 213.0 19 949.0 20 150.0 n.a Overall productivity of labour %, y/y 4.7 4.1 5.4 4.8 4.6 2.4 -2.9 Industrial production %, y/y 5.5 9.6 6.7 8.2 10.5 -1.9 -13.4 Unemployment 2) % 10.3 10.3 9.7 7.7 6.0 6.0 9.2 Inflation (HICP) 3) %, average -0.1 2.6 1.6 2.1 3.0 6.3 0.6 Inflation 2) %. y/y 1.0 2.8 2.2 1.7 5.4 6.3 1.0 Year-on-year index of average nominal % 6.6 6.5 5.3 6.5 7.3 8.4 3.5 wages *) Year-on-year index of average real wages *) % 6.5 3.6 3.3 3.9 4.4 2.0 2.5 Exports 4), 5) EUR, mil. 43 053.0 54 075.0 62 961.0 75 699.0 89 396.0 99 247.0 80 711.0 Exports 4), 5) %, y/y 5.7 25.6 16.5 20.2 18.0 -25.5 -18.9 Imports 4), 5) EUR, mil. 45 236.0 54 914.0 61 647.0 74 305.0 86 238.0 96 533.0 74 950.0 Imports 4), 5) %, y/y 5.1 21.4 12.3 20.2 16.1 -27.2 -22.7 Balance of trade 4), 5) EUR, mil. -2 183.0 -839.0 1 314.0 1 394.0 3 159.0 2 714.0 5 762.0 Foreign exchange reserves of ČNB 2) EUR. billion 21.4 20,9 25.1 23.9 23.7 26.6 28.8 CZK/EUR 6) average 31.844 31.904 29.784 28.343 27.762 24.942 26.445 CZK/USD 6) average 28.227 25.701 23.947 22.609 20.308 17.035 19.057 Source: Czech Statistical Office, Czech National Bank (ČNB); General note: y/y shows year-on-year change in the indicator, n.a. = not available 1) PPS- Purchasing Power Standard; 2) At the end of the period; 3) HICP = Harmonized Index of Consumer Prices; 4) Foreign trade data expressed in EUR are the sum of the different monthly values in CZK calculated by the average monthly exchange rate announced by the Czech National Bank; 5) 2009 data according to the statement of 26 February 2010; 6) Czech National Bank; 7) Preliminary data; *) of natural persons C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 13
  14. 14. ECONOMICS USEFUL INFORMATION: – Czech Statistical Office – Czech National Bank – Ministry of Finance dation sector, in transport (especially as a result of lower fuel prices), postal services and telecommunications, and in the clothing and footwear sector. 17.8%. The balance of trade (favourable ever since 2005) which, in 2008, amounted to CZK WAGES 67.2 billion (EUR 2.7 billion/USD 4.2 billion), Average gross monthly nominal wages of employees (full-time in 2009 rose to CZK 152 billion (EUR 5.8 equivalent) in 2008 amounted to CZK 22 691 (EUR 907), a 1.9% billion/USD 8.1 billion), the highest surplus increase year-on-year in real terms. In 2009, wages grew at a in CR’s history. In 2009, exports covered slower rate, annual average gross monthly wages amounting to imports by 107.8% as against 102.8% in 2008. CZK 23 598, 3.0% more than in the previous year in real terms. In Territorially, the favourable balance of trade the 4th quarter, nominal wages grew by 5.2% year-on year, which with the EU states rose slightly year-on-year in real terms equals 4.8%. This relatively high growth, however, and the deficit in trade with states outside the was influenced by dismissals of low-wage employees and a lower EU declined. In the commodity structure, the sick leave rate. surplus in semi-finished product and indus- trial goods trading increased, while trade in Jana Bondyová machinery and transport equipment showed Czech Statistical Office a decline. PRICES *) All data in this section relate to figures applying on the deadline date, 26 February 2010; In 2008, the inflation rate, measured by the for conversion into euros, the average monthly exchange rate announced by the Czech consumer price index, amounted to 6.3%, the National Bank has been used. highest level for the past 10 years. This increase was mainly due to higher energy and housing prices, higher VAT rate, and an OTHER INFORMATION: – automotive industry increase in food prices. In 2009, the average – railway industry annual inflation rate amounted to 1.0%, the – aircraft industry second lowest inflation rate since 1989. This Photo: Škoda Auto , – heavy engineering slowdown was mainly due to the waning , – software and IT impact of indirect tax changes. Prices declined, – tourism in particular in the food and non-alcoholic , – power industry beverage sector, in the catering and accommo- – chemical industry 14 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  15. 15. C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 15
  16. 16. ECONOMICS Czech-Estonian Trade and Economic Relations Trade between the Czech Republic and Table 2. The most important commodities of Czech exports Estonia has a long tradition. The political in 2009* (Nomenclature Harmonised System 4) changes that took place in Central and East Share in EUR Europe at the end of the 1980s meant for both Code Commodity % thousand countries a new era of building political and Motor cars and other motor vehicles principally commercial and economic relations for both 8703 13.57 11 451 designed for the transport of persons countries. At the moment, bilateral busi- Organic surface-active agents; washing and ness relations are influenced by the current 3402 3.99 3 370 cleaning preparations economic crisis. 3917 Tubes, pipes, hoses, and fittings of plastics 3.04 2 569 As for the amount of trade exchange, Estonia is Motor vehicles for the transport of ten or more the Czech Republic’s smallest business partner 8702 2.86 2 412 persons, including the driver from among the Baltic states. Automatic data processing machines; units, Between 1999 and 2007 the growth of exports 8471 1.90 1 603 readers etc. to Estonia was stable and, with the exception of Machinery for pocessing by change of 2001, the same is true for the turnover. Due to the 8419 1.78 1 501 temperature, non-electric water heaters economic crisis, exports fell significantly at the Articles for conveyance/package of goods, end of 2008, which resulted in a slight decrease in 3923 1.71 1 444 stoppers, lids, caps etc, of plastics the year-on-year comparison with 2007. Exports 8308 Clasp/buckle/eye, etc. of base metal 1.62 1 367 continued to decline in 2009 and were by 39% 8414 Air and vacuum pumps, compressors, fans etc. 1.56 1 316 lower than in 2008. In 2009, imports to the Czech Republic from Estonia declined by 27% and the Electrical apparatus for line telephony or line 8517 1.51 1 275 telegraphy, including line telephone turnover by 36%. Improvement of the adverse development of mutual trade is still at the level of Ceramic sink,wash basin, bath, bidet, and 6910 1.44 1 218 similar sanitary fixture desire (see Table 1). 2309 Animal feed preparations, nes 1.43 1 204 GOODS STRUCTURE Others 63.59 53 683 Czech exports to Estonia in 2009 consisted main- Total 100. 00 84 413 ly of personal vehicles and other vehicles for Source: Ministry of Industry and Trade (March 2010), * preliminary data passenger transportation (14% of total export), pipes and hoses from plastic materials (3 %), BOTH COUNTRIES AS EU MEMBERS road motor vehicles (2.9%), automatic data Due to the fact that both countries have become parts of the single processing machines (1.9%), heating and cooling internal EU market conforming to EU legislation, there are at present appliances (1.8%) etc. The main exporters in- no obstacles or limitations to bilateral business. The internal EU clude ŠKODA AUTO, Czech Airlines, Glaverbel market is exempt from customs duty and control regimes. However, Czech, Aircraft Industries, SOR Libchavy, Bralo there is a reporting obligation in the INTRASTAT statistics system as CZ, Laufen CZ etc. (see Table 2). well as measures resulting from applying national tax directives for Czech imports from Estonia in 2009 con- VAT and the excise tax. sisted predominantly of flat rolled iron and steel products (9.2% of total import), flooring PERSPECTIVES OF BUSINESS RELATIONS (8.4%), wires, cable and insulated electri- The Czech Republic is interested in the Estonian market. Czech cal conductors (6.2%), profiled wood (5.6%) goods were present on the local market in the pre-war period as well and cut and cleft timber (5.2%) etc. Estonian as in the past decades of mutual economic history and they have goods are imported by companies such as always been sought after. ANIMALCO, Galvex, SKAN HOLZ Jirkov or Czech companies take advantage of the fact that the Estonian market is Baltaxia (see Teble 3). one of the most open areas in Europe; there is an equal competing envi- ronment for both local and foreign companies. Table 1. Development of trade between the Czech Republic and Estonia Estonian businessmen prefer direct trade rela- (EUR million) tions. The absorption of the Estonian market is 2001 2002 2003 2004 2005 2006 2007 2008 2009* limited and at the moment of economic crisis the purchasing power of the population is Exports 32.4 39.3 49.3 68.3 76.4 116.3 146.4 137.6 84.4 unfortunately significantly falling. Photo: PhotoCombo Imports 14.9 17.9 27.2 24.0 20.8 26.6 32.3 38.6 28.2 Turnover 47.3 57.2 76.5 92.3 97.2 142.9 178.7 176.3 112.6 CZECH PRODUCTS IN ESTONIA Balance 17.5 21.4 22.1 44.3 55.6 89.7 114.1 99.0 56.2 Noticeable Czech products in Estonia are Source: Czech Statistical Office, Ministry of Industry and Trade, *preliminary data Škoda cars (the number of Škoda Superbs 16 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  17. 17. been exhausted), Czech glass has a good repu- tation on the market. One of the significant bilateral economic events of 2009 was the opening of a combined power station with 67 MW heat output and 23 MW electric output, the turbine supplier of which was Siemens Industrial Turboma- chinery s.r.o., Brno. In the field of transport technology, Czech producers and suppliers of trams and related services watch the inten- tions of Tallinn’s municipal council, who want to start the project of building two new tram routes and to replace the tram fleet in Tallinn. Czech suppliers could participate in the project of a railway connection between the Baltic states and West Europe – Rail Baltica. There is a chance to succeed, particularly in the sphere of railway building. SOR Libchavy is a suc- cessful bus supplier to Estonia. A highly perspective field of Estonian econ- omy is also the energy industry: technological innovations in energy production are ex- pected. New constructions will probably take place, such as power stations with combined production of electricity and heat, those using the biomass, and wind power stations. Table 3. The most important commodities of Czech imports in Improvement of the technology of burning 2009* (Nomenclature Harmonised System 4) bituminous shale and significant reconstruc- Share in EUR tion of electric distribution networks can also Code Commodity % thousand be expected. Czech firms can offer cooperation Flat-rolled products of iron, steel over 600mm, in these areas. 7210 9.17 2 587 plated or coated Significant financial resources from national Carpets and other textile floor covering tufted as well as EU funds will also be invested into 5703 8.42 2 376 including finished environmental enhancement. Czech companies 8544 Insulated wire/cables, optical fibre cables 6.22 1 754 can offer technologies for water treatment and 4409 Wood profiled,planed, sanded, finger jointed 5.64 1 590 waste liquidation. An example of successful business is Ecofluid, which supplied waste- Wood sawn/chipped, sliced/peeled etc. above 4407 5.22 1 474 water treatment plants for six locations in 2009. 6mm Essential positive role in mutual Czech-Esto- Mattress supports;mattresses,quilts,fitted with 9404 4.35 1 226 nian relations has been played for six years by springs, stuffed etc. the direct Czech Airlines connection between Fish fillets and other fish meat fresh, chilled or 0304 4.30 1 213 Prague and Tallinn. The strong position of frozen Czech Airlines on the Estonian market allows 9406 Prefabricated buildings 4.20 1 185 for the development of other services, espe- Veneer sheets & sheets for plywood & wood 4408 3.77 1 063 cially various forms of tourism in the whole sawn lengthwise, sliced/peeled up to 6 mm of the Czech Republic. To increase tourism in Prepared/preserved fish; caviar and caviar 1604 substitutes from fish eggs 3.55 1 001 both directions is in the interest of both our countries. Mastics, painters fillings & nonrefractory surfacing 3214 3.07 867 Despite the fact that Estonia’s transparent tax preparations for walls etc. system, stable exchange rate of local currency 4016 Articles of vulcanised rubber (not hard rubber) 2.98 840 to Euro, a relatively high level of education, 8708 Parts, components of tractors, trucks, cars etc. 2.49 704 and good knowledge of languages make it Others 36.62 10 336 a paradise for foreign investment, Czech Total 100.00 28 216 companies have so far invested neither into Source: Ministry of Industry and Trade (March 2010), *preliminary data Estonian industry nor its services. There are also no Czech-Estonian joint-ventures in on Estonian roads has increased; motoring magazines evaluated Estonia. the Roomster model as the best model on the Estonian market in 2007, and Škoda Yeti has become Car of the Year 2010). Czech beer Luboš Nový is traditionally sold in Estonia (there are still possibilities for further Head of Commercial and Economic Department expansion in this field), the assortment of food products is getting Embassy of the Czech Republic in Estonia wider (here, too, the potential of increase of trade exchange has not C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 17
  18. 18. ECONOMICS Czech-Latvian Trade and Economic Relations Trade and economic relations between the as a whole, this was the second year when both exports and imports Czech Republic and Latvia have been declined, although the surplus on the Czech side of the balance sheet showing a marked increase recently. As in grew. Here, it should be noted that, from the point of view of the other European relations, this increase is Latvian side, in the past two years the deficit on the Czech side of the mainly due to the process of integration of the mutual balance of trade decreased substantially under the influence two countries into the European Union. We of the trends mentioned above. The Czech side, too, sees this fact, on have witnessed a distinct revival, a feature the whole, as a positive signal, because a high imbalance in trade usually accompanying integration processes. definitely is not our aim. The entwinement of economic structures on the global and European scale, however, also CZECH MEANS OF TRANSPORT IN LATVIA has less favourable aspects, as could be seen Despite the crisis – every crisis must end one day, after all – it can at the end of the first decade of this century, be said that the two countries have a lot to offer each other, and with the onset of the financial and economic their mutual trade continues to be based on a very wide range of crisis. products. A certain success of Czech exporters is to be seen literally at every step. Since September 2009, all of the 150 contracted DEVELOPMENT OF TRADE RELATIONS modern Škoda 24 Tr Irisbus trolleybuses have been plying the Logically, after years of growth, Czech-Latvian streets of Riga, adding comfort to the city’s public transport. In trade relations, too, could not escape a certain addition, in spring 2010 low-platform tramcars, also bearing the decline. While in the years 2003-2007 the Škoda trade mark, will appear in the Latvian capital, in fulfilment volume of mutual trade grew by tens of per of a contract signed by the two sides, and this is not the end of the cent annually and in 2006 showed a nearly 40% modernisation of Riga’s public transport. As all good things come growth year-on-year, in mid-2008 the trend in threes, the large number of Škoda cars on Latvian roads is reversed rapidly and started in the opposite incontestable evidence of the fact that in the past four years this direction. In 2008, mutual trade turnover trade mark has been the most popular one on the local market, of dropped by 20.2%, with Czech exports falling which Škoda takes a share of more than 10%. by 24% in comparison with 2007, while Latvian exports to the Czech Republic were still PARTICIPATION OF THE CR IN growing, although at a slower rate, and THE RECONSTRUCTION OF RIGA’S POWER PLANT showing a 9.2% growth. In May 2009, the first power unit of Riga’s reconstructed heat and The economic crisis, and especially the drastic power generating plant, TEC-2, for which Škoda Power supplied decline in imports into Latvia, also left an its 150 MW turbo-set with accessories, was ceremonially put into imprint on the development of mutual trade in 2009. According to preliminary figures avail- Table 2. The most important commodities of Czech exports in able before the deadline for this issue, Czech 2009* (Nomenclature Harmonised System 4) exports in 2009 dropped by 29.2% (in Euro- Share in EUR denominated prices), while Latvian sales to the Code Commodity % thousand CR rose by 9.4% year-on-year. In absolute 8702 Public-transport type passenger motor vehicles 25.78 28 245 values, in the first ten months of 2009, Czech exports were worth EUR 109.5 million, while Motor cars and other motor vehicles principally 8703 6.20 6 789 designed for the transport of persons imports from Latvia amounted to EUR 34.1 million (see Table 1). 4409 Wood profiled, planed, sanded, finger jointed 5.52 6 049 The preliminary data for 2009 indicate that, Organic surface-active agents; washing and 3402 4.12 4 510 from the point of view of Czech foreign trade cleaning preparations 3901 Polymers of ethylene, in primary forms 2.98 3 267 Table 1. Trade exchange between the Czech Safflower, sunflower/cotton-seed oil & fractions, 1512 2.62 2 866 Republic and Latvia (EUR thousand) not chem mod 8537 Switchboards, panels, control panels etc. 1.72 1 882 Exports Imports Turnover Balance Electrical apparatus for line telephony or line 8517 1.64 1 792 Photo: Škoda Electic archives 2005 113 513 15 157 128 670 98 356 telegraphy, including line telephone 2006 167 870 20 117 187 987 147 753 Automatic data processing machines; units, 8471 1.59 1 739 2007 201 737 26 094 227 831 175 643 readers etc. 2008 153 345 28 504 181 849 124 841 Others 47.85 52 426 2009* 109 565 34 105 143 670 75 460 Total 100.00 109 565 Source: Czech Statistical Office, Ministry of Industry and Trade, *preliminary data Source: Ministry of Industry and Trade, *preliminary data 18 C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r
  19. 19. Table 3. The most important commodities of Czech imports in 2009* (Nomenclature Harmonised System 4) Share in EUR Code Commodity % thousand Bars and rods of iron or non-alloy steel, not further worked than forged, hot-rolled, hot- 7214 9.77 3 331 operation. Owing to its reconstruction, this drawn or hot-extruded, but including those twisted after rolling combined heat and power generating source has become the most modern facility of its kind Hot-rolled, hot-drawn or hot-extruded, but 8517 8.41 2 870 in the entire Baltic region. From the examples including those twisted after rolling mentioned here, the list of which could con- Tubes, pipes and hollow profiles ( seam tinue, it can be seen that the leading items in 7306 or welded, riveted or similarly closed), of iron or 7.85 2 679 steel Czech exports are commodities with a high amount of added value. Prepared/preserved fish; caviar and caviar 1604 6.03 2 056 substitutes from fish eggs COMMODITY STRUCTURE Structures & parts of; plates, rods, angles etc. of 7308 4.60 1 568 iron In terms of percentage, machinery and transport equipment in 2009 accounted for 50.5% of Czech Parts of typewriters, computers etc., automatic 8473 3.72 1 268 data processing exports to Latvia; chemicals and related products represented 11.9%, miscellaneous manufactured Glass fibres (incl. wool) and articles thereof 1 114 7019 3.27 (yarns, fabrics) articles, classified chiefly by material 10.8%, different industrial products (8.1%), raw material 4418 Builders joinery & carpentry of wood 3.12 1 065 (8.0%). Other commodities, such as food, Semi-finished products of iron or non-alloy 7207 3.10 1 059 beverages and crude materials, had smaller steel shares (see Table 2). In the opposite direction, i.e. Cigars, cheroots, cigarillos & cigarette of 2402 2.23 761 in Latvian exports to the CR, the dominant items tobacco/tobacco substitutes in 2009 were bars and rods of iron (9.77%), Others 47.90 16 334 electrical apparatuses for telephony (8.41 %), Total 100.00 34 105 products of the woodworking industry and Source: Ministry of Industry and Trade of the CR, *preliminary data related sectors, iron and metal products (tubes, ingots, rods, profiles), food and tobacco products (see Table 3). officials of the Czech diplomatic mission and The fact that, even in the difficult period of economic slowdown, the CzechTrade office in Riga. They concern interest in co-operation is not fading, is attested, among other things, different areas of business – from trade to by the strong participation of representatives of smaller and me- manufacturing or subcontractor co-operation dium-sized companies in the seminar organised in Riga by the and services, including transport and tourism. Investment and Development Agency of Latvia (LIAA) devoted to commercial and entrepreneurial opportunities in the Czech Repub- Marta Stolařová lic. Evidence of the unwaning interest of companies in both countries Head of Commercial and Economic Department is the frequent enquiries and requests for contacts as to specific Embassy of the Czech Republic in Latvia possibilities of involvement in different branches, handled by C z e c h R e p u b l i c – Yo u r Tr a d e Pa r t n e r 19