Investment and foreign trade drove the Czech Republic’s economic growth in 2022
According to the Czech Statistical Office’s new estimate at the end of the fourth quarter of 2022, the Czech Republic’s Gross Domestic Product decreased by 0,4% quarter-on-quarter, thus compared to the previous quarter, but increased by 0,2% year-on-year, thus compared to the same quarter in 2021. Overall, GDP for the whole of 2022 grew by 2,4%. Specifically:
Gross Domestic Product development in percent:
| 1st quarter | 2nd quarter | 3rd quarter | 4th quarter | the year 2022 | |
| From previous quarter | +0.6 | +0.3 | -0.3 | -0.4 | +2.4 |
| For the same quarter in 2021 | +4.7 | +3.5 | +1.5 | +0.2 |
Development of gross value added in percent:
| 1st quarter | 2nd quarter | 3rd quarter | 4th quarter | the year 2022 | |
| From previous quarter | +0.5 | +0.5 | -0.2 | +0.3 | +2.5 |
| For the same quarter in 2021 | +4.0 | +3.4 | +1.5 | +1.0 |
Czech economic growth in 2022 was possible mainly due to investment and foreign trade. The most impactful contribution to GDP growth was fixed asset creation, then investment up 6 percent from the year before, foreign trade, and government sector spending. Not a factor in GDP growth was household spending, down 1%.
Gross Value Added (GVA) increased 0,3% from last quarter and 1% from a year earlier.
| Sectors that influenced GDP | Compared to the same quarter in 2021 |
| Investment | +6% |
| Fixed asset creation | |
| Foreign trade | |
| Government sector spending | |
| Household spending | -1% |
| Sectors that influenced GVA | |
| Manufacturing industry | +1.6% |
| Banking and insurance | +3.6% |
| Real estate | +2.4% |
| Construction | +0.9% |
| Trade, transportation, lodging and hospitality | -0.3% |
| Information and communication activities | -1.4% |
| Professional, scientific, technical and administrative activities | -0.3% |
| Sectors that influenced VAT | |
| Industry | +3.1% |
| Real estate activities | +5.1% |
| Trade, transport, accommodation and hospitality | -2.9% |
| Construction | -2.8% |
| Demand-side influences | |
| Final consumption expenditure of public institutions | +0.2% |
| Gross fixed capital formation | +0.9% |
| Foreign demand | +2.4% |
| Stocks | -0.3% |
| Household final consumption expenditure | -5.5% |
As for household consumption, final spending decreased by 2,8% on a quarterly basis. The largest decline was seen in purchases of durable goods and food spending (down 10% year-on-year). Only spending on services experienced growth. Fixed investment decreased 1,1% from the previous quarter (the third in 2022) in housing, buildings, construction and transportation equipment. In contrast, investment in machinery, equipment and intellectual property grew by 4,6%.
The balance of foreign trade in goods and services reached 11,1 billion Czech crowns in current prices. They grew by 0,5% quarter-on-quarter and 9,7% year-on-year. This development was most influenced by growth in exports of electrical equipment and motor vehicles. Imports were unchanged on a quarterly basis but increased by 7,6% year-on-year.
The graph below shows the contributions to annual real growth:
- BLUE: household final consumption expenditure
- GREEN: gross capital formation
- PURPLE: real year-on-year change
- RED: general government final consumption expenditure
- YELLOW: foreign trade balance
GDP deflator: increased by 10,8% year-on-year and decreased by 0,5% quarter-on-quarter.
Employment: increased by 1,7% over 2021, counting 5.450.000 people. In total, 3,6% more hours were worked than in 2021.
Sources: https://www.camic.cz/ ; https://www.czso.cz/
Source of the chart: https://www.czso.cz/
Sources of images: https://pixabay.com/ ; http://storyset.com
