External Trade of the Czech Republic in

Commentary

External trade in October 2004

Growth of exports and imports slowed down

According to preliminary data, seasonally adjusted exports rose by 2.5% and imports by 1.1% month-on-month.

In terms of year-on-year comparison, current price exports and imports were up 16.6% and 15.1%, respectively. These rates of growth of exports and imports were the lowest ones from January and February 2004, respectively. Due to the appreciation of the Czech koruna against the US dollar and against the euro, external trade grew faster both in terms of US dollars (exports +26.4% and imports +24.7%) and in terms of euros (exports +18.5% and imports +16.9%) than external trade valued in Czech korunas.

The trade balance ended in a deficit of CZK 4.1 billion, which amounted to a y-o-y improvement of CZK 1.3 billion. This is the lowest deficit recorded in October over the last decade. The trade balance with EU member states reached a surplus of CZK 17.1 billion, the trade balance with non-EU states ended in a deficit of CZK 21.2 billion. Trade balance improved in ’machinery and transport equipment’ (a CZK 8.9 billion increase in surplus) and in ‘chemicals and related products’ (a CZK 0.9 billion decrease in deficit). On the other hand, trade balance worsened in ’mineral fuels, lubricants and related materials’ (a CZK 3.5 billion increase in deficit) and in ‘manufactured goods classified chiefly by material‘ (a CZK 2.0 billion decrease in surplus).
The higher surplus of trade in ’machinery and transport equipment’ resulted mainly from improvements in the balance of trade in telecommunications equipment (a CZK 0.5 billion deficit turned into a CZK 2.0 billion surplus), increases in surplus of trade in office machines and automatic data-processing machines (by CZK 1.7 billion) and general industrial machinery and equipment (by CZK 1.2 billion), and a simultaneous decrease in deficit of trade in electrical machinery, apparatus and appliances (by CZK 2.1 billion). The balance of trade in ’mineral fuels, lubricants and related materials’ deteriorated mainly due to markedly higher petroleum imports (+123.6% in terms of value and +74.0% in terms of volume) in comparison to October 2003 when petroleum imports were below the average. Natural gas imports remained at a lower level, falling by 20.1% in terms of value and 16.2% in terms of volume y-o-y.

By group of countries, balance of external trade with EU member states reached a CZK 1.5 billion increase in surplus. Surplus of trade with Germany grew by CZK 3.3 billion, and the CZK 0.1 billion deficit of trade with Belgium turned into a CZK 1.1 billion surplus. Conversely, surplus of trade with the Netherlands dropped by CZK 2.5 billion. Deficit of trade with non-EU states slightly increased by CZK 0.2 billion y-o-y, most with Russia (by CZK 1.1 billion) and Japan (by CZK 0.9 billion).

Over last twelve months, exports and imports were up 21.3% and 19.0%, respectively. Trade gap totalling CZK 46.6 billion was CZK 17.8 billion down on the preceding twelve months.

Favourable development was reported for trade in ‘machinery and transport equipment‘ (a CZK 39.9 billion increase in surplus). On the other hand, higher deficits were recorded for trade in ‘chemicals and related products’ (by CZK 7.0 billion), ‘crude materials, inedible, except fuels‘ (by CZK 3.0 billion) and ‘mineral fuels, lubricants and related materials‘ (by CZK 2.8 billion). At the same time, surpluses were lower in trade in ‘manufactured goods classified chiefly by material (by CZK 2.8 billion) and ‘miscellaneous manufactured articles‘ (by CZK 1.1 billion).

By group of countries, surplus of trade with EU member states grew by CZK 48.8 billion, particularly in trade with Germany (by CZK 29.6 billion), Slovakia (by CZK 13.8 billion), Austria (by CZK 8.7 billion) and Belgium (by CZK 7.7 billion). Deficit of trade with non-EU states rose by CZK 30.9 billion, especially in trade with Japan (by CZK 20.8 billion) and China (by CZK 16.7 billion). On the other hand, trade gap with Malaysia decreased by CZK 3.3 billion.

January-October 2004 exports and imports grew by 23.3% and 20.5%, respectively. Trade deficit reached CZK 18.3 billion, which was CZK 23.2 billion down year-on-year.

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According to the communication from the Directorate General of Customs, data were received from 96.1% of the total of 19 963 firms obliged to report to the Intrastat system. As far as large firms are concerned (firms whose value of exports to or imports from EU member states exceeded CZK 100 million in 2003), the response rate was 98.6% from among the total number of 2 724 firms.

Data on firms exempted from reporting duty (firms whose annual value of trade with EU member states was below CZK 4 million for goods dispatched and below CZK 2 million for goods received) and data on firms that failed to report were imputed. The imputation methods are based on data that firms supplied in the previous period. As to the October data, shares of imputed values in total exports and total imports were 0.9% and 1.0%, respectively.