“The year-on-year decline in GDP was negatively affected by lower household final consumption expenditures and lower gross capital formation. Foreign demand had a positive effect,” said Vladimír Kermiet, director of the National Accounts Department of the CZSO.
It is precisely the small consumption of Czech households that has long been identified by economists as the main cause of the declining performance of the economy. People spend little in stores, so stores have little sales, and ultimately there is little demand for goods from manufacturers.
Price-adjusted and seasonally adjusted gross domestic product (GDP) in the third quarter was a preliminary estimate of 0.3% lower than in the previous quarter and fell 0.6% from the same quarter a year earlier.
The quarter-on-quarter drop in GDP was mainly influenced by foreign demand. Domestic demand stagnated.
In a quarter-on-quarter comparison, there was a decrease in gross value added (GVA) in most sectors of the national economy. Industry and trade, transport, accommodation and hospitality sectors had a negative impact.
The same industries were most affected by the year-on-year decline in VAT. On the contrary, information and communication activities and professional, scientific, technical and administrative activities prospered.