According to the Organisation for Economic Co-operation and Development, the repercussions of Russia's war of aggression against Ukraine have hindered the Czech Republic's post-
pandemic recovery. High inflation persists, necessitating a tight macroeconomic policy to restore price stability. However the Czech labour market remains robust.
Capital: Prague Total Area: 78,867 sq km Population: 10.88 million Median age: 44.2 years Religions: Roman Catholic 7 per cent, other believers belonging to a church or religious society 6 per cent (includes Evangelical United Brethren Church and Czechoslovak Hussite Church), believers unaffiliated with a religious society 9.1 per cent, none 47.8 per cent, unspecified 30.1 per cent (2021 est.) Languages: Czech (official) 88.4 per cent, Slovak 1.5 per cent, other 2.6 per cent, unspecified 7.2 per cent (2021 est.) Currency: The koruna, or crown Government type: Parliamentary Republic Chief of State: President Petr Pavel (since March 9, 2023) Head of Government: Prime Minister Petr Fiala (since December 17, 2021) Elections: President directly elected by absolute majority popular vote in 2 rounds if needed for a 5- year term (limited to 2 consecutive terms); elections last held on 13 to 14 January 2023 with a second round held from 27 to 28 January 2023; next election to be by January 2028; prime minister appointed by the president for a 4-year term Unemployment: 3.9 per cent Tourism: 7.4 million (foreign and domestic).
of the country's exports is directed toward the EU, with 26.3 per cent going to Germany, its main trading partner. Te United States follows as Czechia’s second-largest non-EU export des- tination, after the United Kingdom. EU member states represent the largest investors in the Czech Republic.
ECONOMIC OUTLOOK Czech GDP experienced a growth of 2.4 per cent in 2022, only to contract by 0.4 per cent in 2023, as reported by the Czech Statistical Office. Tis GDP decline can be attributed to high inflation rates, largely driven by significant spikes in energy costs related to Russia’s war against Ukraine. Te average inflation rate for 2023 remained elevated at 10.7 per cent, although it was lower than the 15.1 per cent rate seen in 2022. Looking ahead, the Ministry of Finance projects a 1.2 per cent GDP growth for the Czech Republic in 2024, following last year's de- cline.
According to the Organisation for Economic Co-operation
and Development (OECD), the repercussions of Russia's war of aggression against Ukraine have hindered the Czech Republic's post-pandemic recovery. High inflation persists, necessitating a tight macroeconomic policy to restore price stability. However the Czech labour market remains robust, characterised by a low unemployment rate and high levels of job security and em- ployment. All the same according to the OECD: “Loose fiscal policy during the pandemic, measures to cushion the impact of high energy prices and unresolved structural issues linked with population ageing have worsened fiscal sustainability. Te ex- pansionary fiscal policy helped preserve jobs and incomes, but has led to a large deficit and increased public debt.” According to the Economic forecast for the Czech Republic
published by the European Commission after experiencing a 0.3 per cent contraction in 2023, the country's real GDP is projected to grow by 1.2 per cent in 2024 and 2.8 per cent in 2025, as decreasing inflation is anticipated to improve purchasing power. Te government's public finance consolidation plan is likely to result in a decrease in the budget deficit to 2.4 per cent in 2024 and 1.9 per cent in 2025. In fact inflation dropped to the bank’s target of 2.0 per cent year-on-year in June from 2.6 per cent in May.
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