Business News


In Business News: the European Commission warns that the aging population will have a considerable impact on Czech GDP growth; the anti-monopoly office hands down the highest ever fine to a state body, after the Labour Ministry awards a contract without a tender; Czech mortgage and home-building savings loans increase ten times in seven years; sales of second-hand cars rise by over 20 percent; and the diplomats may be at loggerheads but trade between the Czech Republic and Cuba rises considerably.

European Commission warns aging population may hit GDP growth

The Czech Republic is among six European Union states with the most risky public finances, says a new report by the European Commission. It says the aging of the Czech population is a threat that will be reflected in gross domestic product growth - it is expected to slow to 2.6 percent after 2010 and to 0.8 percent between 2031 and 2050. At the moment, the Czech economy grows more than 6 percent a year. The issue of pension reform has yet to be addressed substantially in the Czech Republic; the European Commission warns that expenditures connected with the aging of the population in the Czech Republic will be substantially higher than the EU average.

Labour Ministry fined over awarding contract without tender

The Czech Republic's anti-monopoly office has handed down the biggest ever fine to a state body, fining the Labour Ministry 500,000 CZK (over 22,000 USD) for placing a large order without a tender. The ministry originally did announce a tender for a contract to supply it with a communications system, before cancelling it and giving the order to the company Anect in January. O2, which had taken part in the tender, filed a complaint.

Mortgages, home savings up sharply, but still far lower than EU average

Czech mortgage and home-building savings loans have increased ten times in the last seven years, according to data released this week by the Mesec website. A new study it conducted suggests this upward trend should continue. The authors found 3.1 to 3.5 percent of Czech households take a loan to finance their housing. However, household debts are still some way below the European Union average.

Jobless rate decreases slightly

The jobless rate fell from 7.9 percent to 7.8 percent last month, according to figures released this week by the Ministry of Labour and Social Affairs. The unemployment rate in Prague dropped slightly and now stands at 2.9 percent. The Most district in north Bohemia has the highest percentage of jobless - 20.3 percent.

Sales of used cars up by 20 percent after change in law

There has been a marked jump in the number of used cars imported into the Czech Republic, with a rise of over 20 percent in the January to September period. Most of that sharp growth actually occurred in the summer months, after a new motorways law abolished limits on used car imports. Registration of second hand cars has been 40 percent higher than registration of new automobiles, the Car Importers Association said this week.

Trade with Cuba on the rise despite political differences

On the diplomatic front the Czech Republic and Cuba are frequently at loggerheads. But that hasn't stopped a huge increase in bilateral trade between the two countries. Last year Czech firms increased exports to Cuba by 57 percent, Pravo reported, citing the Industry and Trade Ministry. Sales of motorcycle components, dairy products, beer and power-plant supplies have helped the Czech Republic enjoy a modest trade surplus with the communist state, which exports cigars and rum to the Czechs. And bilateral trade could increase if power-plant supplier Skoda Export wins a contract to refurbish Cuba's coal-fired power plants.