Quarterly GDP preliminary estimate - 4th quarter of 2010

GDP up by 2.3% in 2010, of which in Q4 by 2.9%, y-o-y

In 2010, gross domestic product adjusted for price, seasonal and calendar effects increased by 2.3%, year-on-year (y-o-y), of which in Q4 by 2.9%, y-o-y (+0.5% compared to Q3 2010). Total employment decreased by 0.7% in 2010, y-o-y; however, in Q4 2010 it increased by 0.5% compared to Q3 2010.

In Q4 2010, according to the preliminary estimate, real GDP (adjusted for seasonal and working day effects) increased by 2.9% in comparison to Q4 2009. Compared to Q3 2010, GDP was by 0.5% higher. At constant prices, it reached almost 99% of the level from Q3 2008, which was the top of the economic boom. The positive y-o-y and q-o-q development was influenced mainly by growing industrial performance, especially in the following industries: manufacture of transport equipment, machinery, and electrical and optical equipment. Construction and agriculture recorded, the same as in previous quarters, continuing decrease of the gross value added. Without adjustment for working day effect, GDP in Q4 2010 increased by 3.2%, y-o-y.

In total for 2010, GDP was up by 2.3%, y-o-y. Economic growth was ensured, mainly in the second half of 2010, by gradually increasing performance of industry and market services. Economic recovery in countries of the main trade partners had a positive effect in industries that are oriented as usual on exports: manufacture of chemicals and chemical products, rubber and plastic products, machinery, metal products, transport equipment, and electrical and optical equipment. On the contrary, gross value added formation decreased in construction (as a result of lower volume of orders and demand for new dwellings) and in the second half of 2010 also in agriculture (due to unfavourable climate conditions). The GDP development was negatively influenced also by cuts in general government budget expenditure, which were more markedly reflected in financial management results in the second half of 2010.

During 2010, the demand for goods and services was affected in a different way by many external and internal influences (that were often unrepeatable), which were especially the following:

- growth of external demand and related to that increases in inventories of enterprises;
- saving measures aimed at reduction of budget deficits and the deficit of the general government sector;
- change in the structure of household expenditure related to the development of their disposable income and the modification of the reduced VAT rate;
- termination of the possibility for fast depreciation of transport vehicles as at 30 June;
- unfavourable climate conditions for agriculture in summer months;
- development of photovoltaic power engineering.

Total employment in terms of national accounts increased in Q4 2010 by 0.2% (seasonally adjusted), y-o-y; compared to Q3 2010 it was up by 0.5%. Partial increases were recorded by some industries of market services, while employment in industry has remained almost unchanged both y-o-y and q-o-q. Compared to 2009 in total, employment in 2010 decreased in average by 0.7%; in the second half of 2010 the number of the employed persons was not decreasing any more.
The standard estimate of GDP formation and use will be published on 11 March 2011.

---

Contact: Jan Heller, phone (+420) 274 052 865, e-mail: jan.heller@czso.cz

Published: 15.02.2011
The data are valid as of the release date of the publication.