In 2004, the Czech Republic's foreign trade1) showed the
most favourable results for the past ten years. The foreign
trade turnover reached a record value, which was nearly
four times higher than in 1994; the trade deficit was the
lowest for the past decade, while both the export and
import values were substantially higher than in 1994. Basically,
the favourable results are due to the CR's accession
to the European Union. After the removal of customs barriers
and the shifting of the customs frontier the CR became
part of the gigantic internal market of the enlarged EU,
whereby the trading conditions changed basically for
Czech firms.

In 2004, the country's foreign trade was characterized by
a high growth of both exports and imports, reaching
record levels since the establishment of the Czech Republic
in 1993. In comparison with 2003, exports rose by
23.7 per cent, i.e. by EUR 10.2 billion, to EUR 53.3 billion;
imports were up by 19.2 per cent, i.e. by EUR 8.7 billion
and were worth EUR 53.9 billion. The high growth of
exports and imports resulted in a 21.4 per cent (EUR 18.9
billion) turnover increase to the extraordinarily high level of
EUR 107.2 billion. The all-year growth of trade was
favourably influenced especially by its growth after the
CR's joining the EU, when exports in the period from May
to December grew by an average of 29.3 per cent and
imports by 22.7 per cent;

a significant deficit reduction.In comparison with 2003,
the unfavourable balance of foreign trade was down by
EUR 1.5 billion and amounted to EUR 0.6 billion2). The balance
improved in 2004, exclusively after the CR joined the
EU. While in January-April 2004 the deficit was practically
on the level of the same period in 2003, in May-December
2004 it dropped by EUR 1.5 billion.
2004 exports and imports rose at different rates in relation
to all the main territories.
Although the growth of exports to the EU25 was slightly
below average (23.2 per cent), in absolute figures exports to
those states rose by EUR 8.6 billion and accounted for
nearly 85 per cent. The highest proportion (86.0 per cent) of
total exports went to the EU25. Especially the higher exports
to Germany, by EUR 3.4 billion, to Slovakia, Poland, Austria,
the Netherlands, Hungary, France, Italy, and Belgium were
responsible for the growth of exports to the EU25. Among
the remaining advanced market economies, an above-average
growth of exports was shown in trade with Japan and
Canada. High growth rates were recorded by exports to
CIS3), the developing economies and the European transition
economies; in the total absolute export increase, however,
the said groupings accounted for a mere 11 per cent. The
problem of low exports to the remaining states4) was further
aggravated, as their year-on-year growth was rather negligible
(1.5 per cent)
An above-average growth was recorded by imports
from the EU25 (20.5 per cent). The EUR 6.6 billion
import increase accounted for more than 76 per cent of
the growth of total imports. In 2004, more than 72 per
cent of total imports were from EU states. The absolute
increase in imports from those states was due to higher
imports from Germany, by EUR 2.3 billion, from Poland,
Slovakia, Italy, the Netherlands, France, the United Kingdom,
Austria, and Hungary. As for the remaining
advanced market economies, import increases were
recorded mainly in trade with Japan (by EUR 0.7 billion).
An above-average growth was shown by imports from
European transition economies, while imports from the
other states and from CIS were below average. Substantially
lower was the growth of imports from developing
economies (by 0.6 per cent).
The balance of the foreign trade deficit declined thanks to
the higher growth of exports in comparison with the growth
of imports. From the territorial point of view, the Czech
Republic's balance of foreign trade improved with the EU25,
the European transition economies and the developing
economies, while it worsened in relation to the remaining
states, CIS and the other advanced market economies

All figures are stated in EUR and have been taken from the statistical sources of the Czech Statistical Office. Figures for 2003 are final
according to the balance at 27 August 2004; the 2004 figures are estimates according to the balance at 28 January 2005. 2) The highest
trade deficit for the whole existence of the Czech Republic was recorded in 1996. 3) Commonwealth of Independent States. 4) China, North
Korea, Cuba, Laos, Mongolia and Vietnam.