Growth and Stability of the Czech Economy in the Years 2001-2011

Economic growth of the Czech Republic measured by GDP reached 3,4 % per annum in the decade 2001-2010 and was substantially faster than average annual growth of the European Union. Strong acceleration in the years 2005-2007 was followed by stagnation in the years 2008-2012 caused by strong decline of GDP in the year 2009 and milder recession in the year 2012. The modest recovery in the years 2010 and 2011 was pulled namely by foreign trade, while final consumption and gross fixed capital formation stagnated. Alternative indicator of national income was negatively influenced by growing outflow of primary incomes. Real gross domestic income indicates different results in comparison with gross domestic product because of changes in the terms of trade. Macroeconomic stability improved substantially in the field of foreign trade while general government deficit contributed to its deterioration.

Keywords: economic growth, gross domestic product, current account balance, real gross domestic income, domestic demand, foreign trade and trade balance, national savings, gross capital formation, general government budget