Czech Republic: country overview
30 May 2012by Ina Dimireva -- last modified 30 January 2017
The Czech Republic is a stable and prosperous market economy, which harmonized its laws and regulations with those of the EU prior to its EU accession in 2004. The most important sectors of the Czech Republic's economy in 2015 were industry (32.1 %), wholesale and retail trade, transport, accommodation and food services (18.4 %) and public administration, defence, education, human health and social work activities (14.9 %). The Czech Republic's main export partners are Germany, Slovakia and Poland, while its main import partners are Germany, Poland and China.
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Capital: Prague
Geographical size: 78 868 km²
Population: 10 538 275 (2015)
Population as % of total EU: 2.1 % (2015)
Gross domestic product (GDP): € 163.947 billion (2015)
Official EU language(s): Czech
Political system: parliamentary republic
EU member country since: 1 May 2004
Seats in the European Parliament: 21
Currency: Czech koruna (CZK)
Schengen area member? Yes, Schengen Area member since 21 December 2007.
Presidency of the Council: the Czech Republic has held the revolving presidency of the Council of the EU once in 2009.
Country Overview
The Czech Republic became an independent state in January 1993 after Czechoslovakia split into its two constituent parts. Before World War II, Czechoslovakia was one of the 10 most industrialised states in the world, and the only central European country to remain a democracy until 1938.
The Czech capital, Prague, is more than 1 000 years old and has a wealth of historic architecture of different styles. Because of this, the city has become a favoured location for many international film makers.
Manufacturing is still a major economic activity, especially the production of automobiles, machine tools, and engineering products. Iron and steel industries are important in Moravia in the east of the country. The chief crops are maize, sugar beet, potatoes, wheat, barley, and rye.
Hills and mountains cover about 95% of the country – ideal for skiing, mountain biking and hill walking. Wild boar and foxes are found in the abundant woodlands.
The Czech Republic produces world-famous beer, including Pilsner. Wine is produced in the southern regions of Moravia and in part of Bohemia. A record 900 natural springs have also ensured that the country produces plenty of mineral water. Traditional dishes include " knedlíky ", a type of dumpling made from potatoes or bread.
Famous Czechs include the Art Nouveau artist Alfons Mucha, composers Antonin Dvorák and Bedrich Smetana, marathon runner Emil Zátopek and the writers Franz Kafka and Milan Kundera.
Economy Overview
The Czech Republic is a stable and prosperous market economy that is closely integrated with the EU, especially since the country's EU accession in 2004. The auto industry is the largest single industry, and, together with its upstream suppliers, accounts for nearly 24% of Czech manufacturing. The Czech Republic produced more than a million cars for the first time in 2010, over 80% of which were exported.
While the conservative, inward-looking Czech financial system has remained relatively healthy, the small, open, export-driven Czech economy remains sensitive to changes in the economic performance of its main export markets, especially Germany. When Western Europe and Germany fell into recession in late 2008, demand for Czech goods plunged, leading to double digit drops in industrial production and exports. As a result, real GDP fell sharply in 2009. The economy slowly recovered in the second half of 2009 and registered weak growth in the next two years. In 2012 and 2013, however, the economy fell into a recession again, due both to a slump in external demand in the EU and to the government's austerity measures, returning to weak growth in 2014, and stronger growth in 2015.
Foreign and domestic businesses alike voice concerns about corruption, especially in public procurement. Other long term challenges include dealing with a rapidly aging population, funding an unsustainable pension and health care system, and diversifying away from manufacturing and toward a more high-tech, services-based, knowledge economy.
Useful links
The Commission's Representation in the Czech Republic
European Parliament office in the Czech Republic
Portal of the Public Administration
Practical information
Tax system in the Czech Republic
Rights of EU citizens travelling in Europe
Facts about the Czech Republic for kids
Tourist information – Czech Republic
Source: European Commission, CIA - The World Factbook