Market Report, "Czech Republic Freight Transport Report Q4 2010", published

Oct. 2, 2010 - PRLog -- The Czech Republic new coalition government is potentially fractious and has yet to knuckle down to economic reform and reduce the country's deficit. However, the Czech economy is among the healthiest in Central and Eastern Europe, even though the Czech economy is recovering from the worst recession since the end of communism in 1989. The real economy contracted by 4.1% in 2009, mainly due to a significant drop in external demand as the Czech Republic's main export markets fell into recession. However the conservative Czech financial system remained relatively healthy throughout 2009.

The Prague-based Statistics Office reported that exports, which account for about 70% of Czech economic output, outpaced import growth in April and pushed the trade balance to a 16th consecutive surplus. This factor is fuelling an economic recovery and a drop in household spending showed a lack of inflationary pressure, signalling stable interest rates and allowed the Czech central bank to the benchmark two-week interest rate by a quarter-point to a record-low 0.75% in May. The economy rebounded in the January-March period, rising an annual 1.2 %, the first increase in five quarters. The Finance Ministry on April 29 raised its forecast for full-year 2010 economic growth to 1.5% from 1.3%. However, unemployment is still high and dropped in April to 9.2% from a six-year high of 9.9% in February and this factor is slowing retail sales.

The Czech Republic expects improving foreign demand to restart economic growth and help the government narrow the fiscal deficit to 5.3% of GDP this year and 4.8% in 2011 from 5.9% of GDP in 2009. Foreign investment is robust, and the EU is injecting the economy with billions of euros in development aid. The Czech Crown has appreciated against other currencies and is seen as a safe haven currency by some investors. This has helped the domestic economy by undercutting inflation as the strong currency offsets high global food and energy prices but is also putting pressure on the very exports that are driving the recovery.

BMI believes that the economy will grow by 1.8%, following the very sharp recession of 2009 when activity levels plummeted by -4.1%. Unemployment, low external demand and fiscal imbalance at home all conspire to prevent a stronger recovery. GDP growth is expected to pick up and reach an annual average of 3.2% over the next five years.

After a very sharp contraction in volumes in 2009, followed by a weak improvement in 2010, growth will then pick up from 2011. In road haulage, volumes contracted by -9.3% in 2009, with a very modest 1.0% recovery in 2010 and a forward looking annual growth average of only 2.1%, less than GDP. Railfreight volumes contracted -8.5% in 2009; we are predicting only a 0.5% recovery in 2010, and medium term annual average growth rate of 1%, also slower than GDP. Airfreight, harder hit by the recession will, however, be more dynamic. After the drop of -20.9% in 2009, a recovery of 2.2% is expected in 2010 and a five-year forward looking annual average of 5.2%, which will be faster than GDP. The less important, inland waterway freight volume will experience a double-digit growth over the next few years after a massive contraction of -65% in 2009.

Czech foreign trade fell by -9.9% during 2009 in real terms, broadly in line with the contraction of world trade. BMI expects a muted recovery this year of 2.9%. Trade will pick up and is expected to have 5.5% growth in 2011, and an average annual rate of 5.6% across our five-year forecast period, which will be significantly ahead of GDP. In 2010 exports are expected to grow 6.2% to US$146.6bn, while imports will expand by a more subdued 5% to US$136.3bn.

In this economic climate both CSA Ceske Aerolinie (Czech Airlines) and Ceske Drahy (CD) will implement policies to make themselves more efficient mainly through cost cutting measures. For CD this will involve investment in new trains and rolling stock but even Czech Airlines will rationalise its airfleet on the Airbus with the addition of eight previously ordered aircraft.

For more information or to purchase this report, go to:
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Report Table of Contents:

Executive Summary
SWOT Analysis
- Czech Republic Freight Transport Industry SWOT
- Czech Republic Political SWOT
- Czech Republic Economic SWOT
- Czech Republic Business Environment SWOT
Market Overview
- Road
- Rail
- Air
Industry Trends And Developments
- Road
- Rail
- Air
Global Oil Products Price Outlook
- Table: Oil Product Price Data And Forecasts, 2010 (US$/bbl)
- Table: Oil Product Price Data And Forecasts, 2007-2014 (US$/bbl)
Industry Forecast
- Table: Rail Freight, 2007-2014
- Air Freight
- Table: Air Freight, 2007-2014
- Road Freight
- Table: Road Freight, 2007-2014
- Water Freight
- Table: Inland Waterway Freight, 2007-2014
- Table: Trade Overview, 2007-2014
- Table: Key Trade Indicators, 2007-2014
- Table: The Czech Republic's Main Import Partners, 2002-2008 (US$mn)
- Table: The Czech Republic's Main Export Partners, 2002-2008 (US$mn)
Company Profiles
- Cechofracht
- Ceske Drahy
- CSA Ceske Aerolinie (Czech Airlines)
BMI Methodology
- How We Generate Our Industry Forecasts
- Transport Industry
- Sources

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Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.