The dramatic improvement from last year’s 14th place was primarily driven by declining inflation, which averaged 2.7 percent. Another positive indicator was the increased share of national income in GDP, though it remains among the EU’s lowest.

A significant factor in this economic resurgence is the growing retention of capital within Czech borders. The country is witnessing a trend of domestic companies returning to Czech ownership, exemplified by ČEZ and ČEPS’s acquisitions in the gas sector. Additionally, Czech firms are expanding their international presence, particularly in the energy sector, through investments by giants like Daniel Křetínský’s EPH and Pavel Tykač’s Sev.en.

However, structural limitations continue to challenge further advancement. The Czech economy’s role as an “assembly plant with cheap labor” results in one of the EU’s lowest value-added ratios, ranking third from bottom in gross value added to total production. In the broader European context, Sweden leads the pack with the healthiest economy, followed by Germany, which maintains its position despite current challenges. Greece finds itself at the bottom of the rankings, with Poland close behind, both struggling with high public debt and low investment rates.

Created by the team of CzechTrade Shanghai
Source: Czech Daily