Mr. Marek Vošta
K Pérovne 1384/13
Bucharova 1423/6
102 00 Praha 10


Papermerchanting in the Czech Republic in 2012



Economic developments

During the whole 2012, the Czech economy was probably experiencing a shallow recession, from which it is expected to emerge at the beginning of this year. However, economic recovery should be only gradual, with GDP increasing by mere 0.1% YoY. In 2013, the economy should continue to be driven by balance of goods and services surplus, though the positive contribution of net exports should be counterbalanced by a negative contribution of gross domestic expenditures.

More pronounced economic recovery should occur only in 2014, when GDP could increase by 1.4%, with positive contribution of both foreign trade and gross domestic expenditures.

We expect consumer prices to grow by 2.1% in 2013, while in 2014 the average inflation rate should reach 1.8%. Therefore, in both years it should be near the CNB inflation target. We consider the risks of both inflation acceleration and deflation to be low. This year, the growth of consumer prices will be significantly influenced by a 1 p.p. hike in both VAT rates, effective from 1 January 2013.

Employment, which is likely to have increased by 0.4% in 2012, should stagnate both in this and the following year. However, the unemployment rate should follow a mild upward tendency; it could increace from an estimated 6.9% last year to 7.3% this year (on average for the whole year), and further on to 7.4% in 2014. Growth of the wage bill could reach 1.9% this year and 3.5% in 2014.

The current account deficit as a percentage of GDP should slightly exceed 1% and should thus remain at a low level.

Forecast risks are slightly tilted to the downside. In addition to the further development of the crisis in the euro zone, there is also the risk of low confidence in the Czech economy.



The developments in the merchanting and printing business


Period 2012 was stable and paper market remained on 2011 level. There was a decrease only of 0,4%. Development in stock and indent business was also on 2011 figures. There was an opposite development by main products Gross. Wood free coated dropped by 1%, wood free uncoated dropped by 3%, but wood free uncoated cut size increased of 7%. Situation on the market was difficult. All Merchant, printers and mill are facing to negative margin developments. Current situation forces all to cost optimalization and higher efectiveness. There was a signifiant reduction of Merchant employees between 2011/2012. Merchants share  by sheets (WFC,WFU,cut size) is 78%. Forecast for 2013 shoild be stable with some possible decrease of 2-3%.


facts & figures