Revised data show Czech GDP dropped in 2023 by 0.2%

Revised data show Czech GDP dropped in 2023 by 0.2%
The Czech economy has stopped contracting, with the latest figures indicating a 0.2% increase. / bne IntelliNews
By bne IntelliNews March 29, 2024

Czech GDP increased in the fourth quarter by 0.4% quarter on quarter and by 0.2% year on year following a revision by the Czech Statistical Office (CZSO).

The revised figures also show that the overall GDP decreased by 0.2% in 2023, an improvement from the preliminary figure showing a contraction of 0.4% and published by CZSO in January.  

“The revised data for last year’s fourth quarter reports better than originally reported development of the government consumption and expenses on the production of fixed capital,” commented the head economist at Generali Investments CEE Radomir Jac for Czech Press Agency (CTK).

Other analysts surveyed by CTK pointed out that despite the revision, the Czech economy still lags behind its level before the Covid-19 pandemic, with GDP lagging behind by approximately 1%.  

The revision followed after “new data for the general government sector were also included in the sector accounts for the fourth quarter of 2023”, CZSO stated.

“Today’s refined estimates confirmed an already known thing – the consumption of Czech households if regaining breath after two years of “darkness”, the head economist from Patria Finance consulting, Jan Bures, was quoted as saying by CTK.

The 4Q figures for the sector accounts show that the total monetary and non-monetary income of households decreased in real terms by 2.5% in 2023, and the real consumption per capita shrank by 5% y/y. The saving rate increased by 2.2 percentage points to 18.6% y/y.

In q/q terms, the total of real monetary and non-monetary income of households per capita increased in the 4Q by 1.1% q/q and by 1.6% y/y. Real consumption of households per capita increased by 1.6% q/q and by 0.2% y/y.

Profit belonging to foreign owners of corporations (profit from foreign investment) reached 5.6% of GDP in 2023.

“Foreign owners distributed almost CZK290bn in the form of dividends, and almost CZK120bn were reinvested. This development reflects high profitability of foreign direct investment in the Czech Republic,” stated Vladimir Kermiet of the CZSO.

The profit rate of non-financial corporations in the 4Q was 48.9%, which is by 0.2 pp higher q/q and by 0.5 pp higher y/y. The total labour costs increased by 6.3% y/y. The investment rate rose by 1 pp y/y and 0.1 pp q/q to 29.3%.