Political and financial crises in 1997 shattered
the Czech Republic's image as one of the most stable and prosperous of
post-Communist states. Delays in enterprise restructuring and failure
to develop a well-functioning capital market played major roles in
Czech economic troubles, which culminated in a currency crisis in May.
The currency was forced out of its fluctuation band as investors
worried that the current account deficit, which reached nearly 8% of
GDP in 1996, would become unsustainable. After expending $3 billion in
vain to support the currency, the central bank let it float. The
growing current account imbalance reflected a surge in domestic demand
and poor export performance, as wage increases outpaced productivity.
The government was forced to introduce two austerity packages later in
the spring which cut government spending by 2.5% of GDP. Growth
dropped to 0.3% in 1997, -2.3% in 1998, and -0.5% in 1999. The basic
transition problem continues to be too much direct and indirect
government influence on the privatized economy. The government
established a restructuring agency in 1999 and launched a
revitalization program - to spur the sale of firms to foreign
companies. Key priorities include accelerating legislative convergence
with EU norms, restructuring enterprises, and privatizing banks and
utilities. The economy, fueled by increased export growth and
investment, is expected to recover in 2000.

purchasing power parity - $120.8 billion (1999 est.)

-0.5% (1999 est.)

purchasing power parity - $11,700 (1999 est.)

agriculture: 5%
industry: 42%
services: 53% (1999 est.)

NA%

lowest 10%: 4.6%
highest 10%: 23.5% (1993)

2.5% (1999 est.)

5.203 million (1999 est.)

industry 32%, agriculture 5.6%,
construction 8.7%, transport and communications 6.9%, services 46.8%
(1997 est.)

9% (1999 est.)

revenues: $16.4 billion
expenditures: $17.3 billion, including capital expenditures of $NA
(1999)

fuels, ferrous metallurgy, machinery and equipment, coal,
motor vehicles, glass, armaments

-4% (1999 est.)

61.466 billion kWh (1998)

fossil fuel: 75.54%
hydro: 2.55%
nuclear: 20.37%
other: 1.54% (1998)

54.733 billion kWh (1998)

10.8 billion kWh (1998)

8.37 billion kWh (1998)

grains, potatoes, sugar beets, hops, fruit;
pigs, cattle, poultry; forest products

$26.9 billion (f.o.b., 1999)

machinery and transport equipment 41%, other
manufactured goods 40%, chemicals 8%, raw materials and fuel 7% (1998)

Germany 42%, Slovakia 8%, Austria 6%, Poland 6%,
France 4% (1999)

$29 billion (f.o.b., 1999)

machinery and transport equipment 39%, other
manufactured goods 21%, chemicals 12%, raw materials and fuels 10%,
food 5% (1998)

Germany 34%, Slovakia 6%, Russia 6%, Austria 6%,
France 5% (1999)

$24.3 billion (1999 est.)

$351.6 million (1995)

1 koruna (Kc) = 100 haleru

koruny (Kcs) per US$1 - 35.630 (December 1999), 34.569
(1999), 32.281 (1998), 31.698 (1997), 27.145 (1996), 26.541 (1995)

calendar year