Business News

Foto: ČNB

In Business news this week: Czech public debt is the second smallest in the EU but the gap widens between the country’s GDP and EU average; Škoda Auto seeks factories to produce its new SUV model; government plans to cap salaries of state-owned firms; Czech Post suspends deliveries to Syria; and a new study predicts how many medals Czech athletes will win at London Olympics.

Czech Republic’s public debt second smallest in EU

The total debt of the Czech Republic, including the debt of the government sector and that of Czech households reached 110 percent of GDP, and made the country the second least indebted country in the EU after Romania, the Czech Statistical Office said on Thursday. The debt of the Czech public sector, which last year amounted to 3.1 percent of gross domestic product, puts the country in ninth place among the 27 EU nations, up from 13th place the previous year.

… but the gap widens between Czech GDP and EU average

Photo: Barbora Němcová,  Radio Prague International
The gap widens between Czech GDP and the EU average. According to figures released by the Czech Statistical office this week, Czech GDP per capita reached 80 percent of EU average while in 2007, it was at 83 percent. In 2000, GDP per capita in the Czech Republic amounted to 71 percent of the average levels in the EU. The decrease is largely due to the slowing down of the Czech economy; in the first part of the last decade, the country was among the top ten fastest growing economies of the bloc while last year it ranked in the middle.

Škoda Auto seeks production plant for its new SUV

Photo: Škoda Auto
The German-owned, Czech-based automaker Škoda Auto is seeking production facilities for its new SUV model which should be launched in 2014, the weekly Ekonom reported. The firm originally planned to produce the model at its plant in Kvasiny but was unable to acquire the land needed for the expansion of the factory. Škoda is now looking in Russia, according to the reports, where the new SUV could be made in Nizhny Novgorod. The new model would become the second Škoda produced abroad, after the small Citigo which is made at a Škoda plant in Bratislava.

Government to cap salaries of state-owned firm

Photo: Barbora Kmentová
The Czech Finance Ministry has announced plans to change the rules for remunerating the salaries of managers of state-owned firms. The ministry is now reviewing their salaries to see how they compare to the private sector. As of January 2013, managers’ salaries in state owned firms will either increase or decrease depending on whether their current paycheques are higher or lower than those in private companies. The new rules should apply to large companies such as ČEZ and Czech Airlines as well as smaller firms where the state or other public entities have at least a one-third stake. The government however does not plan to release the managers’ actual salaries.

Czech Post suspends deliveries to Syria

The state-owned postal company Czech Post on Friday stopped accepting all shipments addressed to Syria. A spokeswoman for Czech Post said the decision was taken in view of the poor security situation in that country, adding that there was no way of telling when shipments to Syria could resume. Last year, Czech Post delivered 231 kilograms of letters and 89 parcels to the conflict-ravaged country.

PwC study predicts Czechs will win six medals at London Olympics

An analysis by the consultancy Price Waterhouse Coopers released this week predicts the medal tally for the Summer Olympics in London. Based on factors such as past Olympic performance, population growth, average income, and state support for sports, the study says that US athletes will top the medal count with 113 medals, three more than they won in Beijing. China ranks second with 87 medals, 13 fewer than four years ago, and Russia comes in third with 68 medals, five less than at the previous summer Olympics. The analysis places the Czech Republic at 32nd place with six medals which is how much Czechs won in Beijing as well.