The general government balance expressed as a percentage of GDP reached a deficit of 1.08 percent in the fourth quarter of 2016. The deficit decreased by 1.54 percentage point (p.p.) compared to the fourth quarter of the previous year.

Net lending/borrowing of government institutions, the Czech Republic, 3.Q2015–3.Q2016

Notice: Data are not seasonally-adjusted; data cannot be compared quarter-to-quarter

In the fourth quarter 2016, the total government revenues fell by 3.1 percent in particular in relation to the decrease in investments grants (-76.4 percent) and current transfers
(-65.4 percent) from the rest of the world. By contrast, annual growth was registered in case of social contributions (7.0 percent), taxes on production and imports (5.3 percent) and income taxes (2.4 percent).

On the expenditure side, the total amount of outlays fell by 6.2 percent. This development was in particular driven by declining investment activity, i.e. expenditures on gross capital formation (-49.7 percent) and investment grants (-16.6 percent). By contrast, a growth on the expenditure side occurred in case of subsidies (17.7 percent), current transfers (10.6 percent) and compensation of employees (7.8 percent).

Annual decrease in deficit was primarily affected by the development at the level of central government institutions whose deficit declined by CZK 17.3 bn to 8 bn, and public healthcare companies (an annual reduction in deficit by CZK 1 bn). In case of local government institutions, a deficit slightly deepened by CZK 0.3 bn.

General government consolidated gross debt decreased on the year-on-year basis by 3.10 p.p. to 37.22 percent of GDP. This annual decrease in indebtedness was caused by both a growing nominal GDP contributing by 1.38 p.p. and a declining nominal debt (-81.4 bn). The indebtedness fell by 1.40 p.p. compared to the second quarter of 2016.

Debt of government institutions, the Czech Republic 4.Q2015-4.Q2016

Shares of individual financial instruments on the total debt remain stable over time with a dominant position of the debt securities (90 percent).

Indicators of government deficit and debt mentioned above are based on the methodology ESA2010 and the Manual on government deficit and debt. Quarterly indicators published in this release are methodologically consistent with the annual indicators used for the EDP purposes. 

Government surplus/deficit is represented by the item B.9 “net borrowing (-) or net lending (+)” in national accounts. It refers to the ability of general government sector to finance other sectors (+) or the need of general government sector to be financed (-) by other economic sectors. Deficit is compared with nominal GDP in given quarter.

General government debt is defined as sum of the items Currency and deposits, Debt securities and Loans. General government debt at the end of a given quarter is compared with the sum of nominal GDP in four previous quarters.

Fiscal indicators of quarterly government deficit and debt are regularly published within the Transmission programme (table 25, table 28) on the web www.czso.cz in the section “GDP, National Accounts” (http://apl.czso.cz/pll/rocenka/rocenka.indexnu_gov?mylang=EN)

Responsible manager: Vaclav Rybacek, Ph.D., tel.: 274 052 596, e-mail: vaclav.rybacek@czso.cz
Contact person: Jaroslav Kahoun, tel.: 274 054 232, e-mail: jaroslav.kahoun@czso.cz
Coming News Release: 03. 07. 2017

This press release was not edited for language.