Strong fundamentals provide a cushion against the economic impact of Covid-19

A2

MEDIUM RISK for entreprise

  • Economic risk

  • Business environment risk

  • Political risk

  • Commercial risk

  • Financing risk

  • Economic risk

  • Business environment risk

  • Political risk

  • Commercial risk

  • Financing risk

Updated in August 2021.

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GDP USD244bn (World ranking 46, World Bank 2020)
Population 10.7mn (World ranking 86, World Bank 2020)
Form of state Parliamentary Democracy
Head of government Andrej Babiš (PM)
Next elections 2021, legislative (Chamber of deputies)
  • EU membership and good international relations
  • High income economy with fairly strong underlying macroeconomic fundamentals
  • Solid monetary policy
  • Favorable public finances
  • Manageable external debt burden
  • Sound banking sector that has proven resilient to adverse shocks
  • Favorable business environment
  • History of fragile coalition governments, resulting in often ineffective policymaking and slow reform progress
  • High export dependence and unfavorable export structure

Trade structure by destination/origin

(% of total, annual 2020)

Exports Rank Imports
Germany 32.7%
1
23.2% Germany
Slovakia 7.6%
2
18.1% China
Poland 6.2%
3
7.9% Poland
France 4.7%
4
4.1% Slovakia
Austria 4.2%
5
4.1% Italy

Trade structure by product

(% of total, annual 2020)

Exports Rank Imports
Road vehicles 19.0%
1
11.4% Electrical machinery, apparatus and appliances, n.e.s.
Electrical machinery, apparatus and appliances, n.e.s. 9.9%
2
9.2% Office machines and automatic data processing machines
Office machines and automatic data processing machines 9.2%
3
9.0% Road vehicles
Telecommunication and sound recording apparatus 7.9%
4
8.6% Telecommunication and sound recording apparatus
Other industrial machinery and parts 6.8%
5
5.2% Other industrial machinery and parts
The payment culture of domestic companies is generally good but when it comes to settling bills some delays can be expected.

  • Low

  • Medium

  • Sensitive

  • High

  • Payments

  • Court proceedings

  • Insolvency proceedings

  • Payments

  • Court proceedings

  • Insolvency proceedings

The court system is complex and is criticized for a lack of transparency and independence. In addition, legal proceedings tend to be overly lengthy and costly while enforcing court decisions may also be problematic.

When the debtor has become insolvent, debt-renegotiation mechanisms are inefficient and liquidation is the default procedure so that the chances of collecting the debt are extremely poor.

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