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Business In Czech Republic
Business in the Czech Republic is enjoying a prosperous year in 2007. According to the Czech Statistical Office, overall confidence in the economy reached a record level in August. Here we explore some of the evidence that suggests that business in the Czech Republic is thriving and on the up.
The Czech Republic joined the European Union in May 2004. This had a positive impact on business in the Czech Republic, including the improved trading of industrial goods, and continues to influence the business environment today. In 2005, the economy grew 6.1 percent and similar growth was experienced in 2006. Exports in 2006 were estimated at $94.8 billion and include motor vehicles, machinery, iron, steel, chemicals, raw materials and consumer goods.
The Czech Republic’s most profitable company, power firm CEZ, reported consolidated net profits of Kc28.8 billion in 2006 and is expecting a growth of 22 percent this year. Their expansion programme has already seen them branch into the power industries in Bulgaria, Romania and Poland. They are currently in talks with the Moscow government about building a power station in Moscow, a deal that could be worth dozens of billions of crowns.
Another large business in the Czech Republic, car manufacturer Skoda Auto, is also showing healthy profit margins.Figures from the first half of 2007 show a growth in production of more than 9 percent and a net profit of Kc7.9 billion, a growth of 23.2 percent. Skoda Auto hope to continue this upward trend in 2008 when it releases the new Fabia Combi model, which was unveiled at this year’s Frankfurt International Motor Show. A growing sector of business in the Czech Republic is information technology. In a list of Europe’s most friendly cities for IT firms by the Belgian IT association, Agoria, Prague is placed 7th out of 26. The Czech Statistical Office states that the Czech Republic has the highest percentage of IT experts compared to the total workforce among EU newcomers. However, demand for IT experts far exceeds supply. According to Milan Prypon, Director of the Czech branch of Hewlett-Packard, Czech companies currently lack as many as 20,000 skilled IT workers.
Boasting some of the finest architecture in the world, the beautiful Czech capital of Prague also features prominently in the fortunes of the tourist industry. Business in the Czech Republic tourist industry has seen a successful first six months of 2007. There has been a reported four-percent rise in foreign visitors and tourists are spending more money during their visit. Revenue from the industry is showing an increase of 9.1-percent on the same period in 2006.
Finally, to celebrate the health of business in the Czech Republic, what better way than with a Czech beer? Beer is close to the heart of this nation. There are 48 large and around 60 private breweries in the Czech Republic and consumption of beer per head is second only to Germany. In 2007, business in Czech Republic breweries is flowing with a record production of 9.92 million hectolitres reported from Jan-June. Even though a slight drop in the consumption of beer among Czechs has been noted, the Czech Beer and Malt Association has reported a rise of 3.8 percent in production for the internal market and sales abroad have grown 4.2 percent on the year. This year is also seeing a boom in the sales of alcohol-free beer, currently up 10 percent on last year, due to the country’s new zero-tolerance policy on drink driving.
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, Mar 25 2008, 1:06 AM EDT
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