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Republic Business |
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Czech
Republic Economy
Under Soviet control, the former Czechoslovak economy
was subject to a high level of state control, lacking the small-scale
private enterprise that existed to some extent in all other Eastern
European economies. In the aftermath of the Prague Spring
economic development was concentrated for political reasons on heavy
industry. In the immediate post-Soviet era at the beginning of the
1990s, these inefficient and redundant industrial monoliths appeared
to be an impediment to the growth of the economy. The other problem
was the lack of natural resources – the country relied heavily
on the former Soviet Union for most of its raw materials, especially
oil.
After a time of political and economic crisis, ending with the separation
of the Czech and Slovak Republics and a dispute with the Soviets
over oil supplies, the Czech government plied ahead with a rapid
programme of market reforms, including mass privatisation and a
major overhaul of the country’s financial system.
The Government identified priority industries for development and
these included: aircraft and vehicles, nuclear energy, electronics,
gasification of coal, transport and communications, as well as light
industries such as textiles, ceramics, leather, glass, a variety
of agricultural and service industries.
Although more than three-quarters of economic output is now in private
hands, the government retains a major influence through minority
shareholdings and state-owned banks (which in turn own some of the
major corporations) in the economy. The results have been good,
with the exception of a mild recession in 1997-98.
The Czech Republic has recorded steady growth within a sound fiscal
and monetary environment. The high value of the koruna
(which has impeded export growth) and damage caused by serious flooding
during 2002 has slowed growth to under 2 per cent as of early 2003.
The country has negotiated associate membership with the European
Union and in 1998 began the process of negotiation to enter the
EU. The Czech Republic joined the EU, along with nine other
countries, at the beginning of 2004. Trade links with Austria
and Germany in particular, and with the EU generally, have grown
considerably. The Czech Republic has already joined the membership
of the IMF, World Bank and the European Bank for Reconstruction
and Development.
Business
Business people should wear suits. German is useful as English is
not widely spoken among the older generation. Long business lunches
are normal. Avoid making business visits during July and August
as many are closed for holidays.
Office hours:
Monday-Friday 08:00-16:00.
Commercial
Information
The Economic Chamber of the Czech Republic (HKCR), Freyova 27,
190 00 Prague 9 (telephone: (2) 2409 6111; fax: (2) 2409 6222; email:
info@komora.cz)
Conferences
and Conventions
The Prague International Congress Centre can accomodate
up to 15,000 people. There are also facilities in hotels throughout
the country. Trade fairs are held in the city of Brno. Information
can be obtained from the Brno
Trade Fairs and Exhibitions, Výstaviste 1, 647 00 Brno
(telephone: (5) 4115 1111; fax: (5) 4115 3070; email: info@bvv.cz)
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