Business News

Lower house approves draft budget for 2010

Photo: CTK As expected, the Czech lower house on Friday approved in the first reading a draft budget for 2010. MPs had already backed a package of measures designed to keep the budget deficit down next year. It has been set at CZK 163 billion, but would have been considerably higher except for those cuts. A deficit for this year of CZK 38.1 billion was also given the green light on Friday. However, because of the economic downturn, it is actually expected to reach 165 billion. And even that figure is artificially low, says Finance Minister Eduard Janota, because it doesn’t take into account CZK 40 billion from the Czech Republic’s reserves that has been drawn on during 2009.

Economic recovery unlikely to run smooth, says senior central bank official

Miroslav Singer Economic recovery in the Czech Republic could turn out to be W-shaped, the vice-governor of the Czech National Bank warned this week. Speaking at a conference, Miroslav Singer said what the Czech economy was currently going through resembled a journey along a bumpy floor rather than a fall, adding that things would likely remain like that for some time. Mr Singer also said that Czechs had the worst in front of them, predicting a testing period in which it will become apparent which firms will survive. The Czech National Bank expects unemployment to peak at 11.6 percent in 2011.

Significant fall in mortgage lending

The total amount lent in new mortgages in the Czech Republic fell by 38.4 percent year-on-year in the first three quarters of 2009, Lidové noviny reported this week, quoting figures from Fincentrum Hypoindex. One analyst told the newspaper that clients were deterred by rising unemployment and fears for their future, while banks had made conditions stricter. People are also waiting to see if property prices go even lower, another analyst said.

Property prices rise slightly, though Prague sees further fall in third quarter

However, flat prices may well have already fallen as far as they’re going to fall. According to official government figures, after a drop in the first half of the year, real estate agents’ asking prices grew by 0.5 percent between the start of July and the end of September. Outside the capital there was a rise of 2.1 percent, though that was offset by a drop of 1.4 percent in Prague in the third quarter. In any case, maybe the time to buy was a few years ago: flats in Prague now cost on average 43.2 percent more than they did in 2005; in the rest of the country they are 69.7 percent more expensive.

Czech Republic lagging behind in terms of percentage of women in senior management

Hospodářské noviny this week devoted a special supplement to women in Czech business. The business daily said the top 100 Czech firms have 406 people in senior management – of whom only 27 are women. That puts the Czech Republic some way below the European average of 10 percent in this respect. Hospodářské noviny also produced a table of the most important women in Czech business, with Vodafone’s Canadian boss Muriel Anton in first place.