14-04-2006

The wave of positive macroeconomic indicators about the Czech economy keep pouring in this week. A major natural gas company has announced plans to enter the Czech market. Skoda Auto continues to be riding high and Czech airlines has a new partner.

Photo: European CommissionPhoto: European Commission Unemployment in the Czech Republic dropped to 8.8 percent in March, a drop of 0.3 percent from the previous month. The unemployment rate was at 9.4 percent one year ago. In more positive macroeconomic news, the inflation rate remained stable in March at 2.8 percent, according to the Czech Statistical Office. However, this is higher than the average EU inflation rate, which is 2.2 percent.

Industrial production grew by 11.8 percent year-on-year in the Czech Republic, the Czech Statistical Office reported. The increase was mostly driven by the machining, metalworking and auto-making industries. In a related story, Skoda Auto reported this week that its quarterly sales increased 18.5 percent. The car maker also said that it plans to eclipse its production record from last year, which stands at 492,000 units.

Russian airline Aeroflot is set join the SkyTeam alliance, the same alliance that Czech airlines is a member of. There are now ten members of SkyTeam, led by Air-France-KLM. Aeroflot is wholly owned by the Russian state. CSA had planned to be SkyTeam's main carrier to former Eastern Bloc countries and it is unclear what this new addition will mena for the company's future.

Vemex, which is controlled by several Czech businessmen and a division of the Russian energy giant Gazprom, announced its intention to enter the Czech market. However, analysts say that Vemex will be very careful while entering the market. However, this will be the first company to break the near monopoly of the gas market in the country held by RWE Transgas.

Japanese electronics firm Panasonic plans to expand its production facilities in the west Bohemian city of Plzen by approximately 3,000 jobs, the economic daily Hospodarske noviny reported this week.

Czech power giant CEZ announced on Thursday that it plans to invest 30 billion crowns, or about one billion euros, in renewable sources of energy, with 20 billion alone going to wind power production. Analysts say that this represents a major change in the firm's heretofore strategy.

14-04-2006