It would be triple better at school. So the susceptibility of Czech companies to bankruptcy is generally not as great as it might seem due to the recent avalanche of bad economic news. But it can be worse, especially in some regions.
This follows on from the “strong sustainability index”, which the local branch has started to publish International Chamber of Commerce (ICC). She was successful in all the physical field in the third quarter, a starting value of 5.9. The number is measured on a scale of one to ten and is updated quarterly thereafter. The higher the value, the better.
The input data for the index is based on data from CRIF, Coface and Dun & Bradstreet, which have long been dedicated to assessing the financial health of companies. They all contributed to the new measure with their own assessments from their databases, which are not otherwise publicly accessible.
“The index was created in response to the growing stability of the economic environment, the weak performance of the Czech economy and the growing number of bankruptcies,” said Ján Čarný, Chairman of the Board The ICC CR and former director of the ICC CR, Czech branch of Coface, will examine the product.
The data includes 350,000 domestic companies. They monitor parameters such as the amount of overdue liabilities, total debt to asset size, transaction data on payment confidence, as well as other non-public information held by CRIF, Coface and Dun & Bradstreet. companies and which companies provide. only for them.
According to Čarný, the biggest contribution from the index is the long-term series, which shows how the local economic situation improves or worsens. The second advantage is the comparison across subjects, which already shows significant differences.
Reliance on mining and energy, gas and commodity distributors is at risk of problems
A ten in the index indicates a hypothetical situation where no company has financial problems. When companies are divided according to the areas with which official state and EU statistics work, the best values are shown by energy and mining – i.e. areas dominated in the Czech Republic by large business groups and famous managed by famous billionaires. .
On the other hand, logistics and the accommodation, catering and hospitality sector seem to be the most dangerous. In all cases, these are areas characterized by great division and also under strong economic pressure from covid.
“The low value of the index does not necessarily mean that the companies in the sector are on the verge of collapse, but that they have partial problems a little more often than companies in the sector with a higher value,” economist Petr Bartoň told .the index, with which the creators work as an expert consultant.
To simplify, Bartoň defines the value of the index as “the ability to last until the next day”. He believes that it is good news that the initial value for all companies together is in the upper half of the fixed period. This should show that the stability of the local economy is still at a strong level.
Both Bartoň and Čarný explain the difference between winners and losers by what happens in individual areas. Although the energy sector is going through a big change as a result of the Green Deal, it is happening with no sign of a break. The changes are happening within the companies, without necessarily anyone having to leave the wheel, in addition, the sector has had good years of energy prices. total
“In logistics, on the other hand, selection happens,” says Bartoň. Čarný sees another risk factor for transport and storage companies as the covid pandemic has “accelerated the creation of new capacities” and these are now partially unused. In gastronomy, there was already a purge during the covid and immediately after it, but the problem continues due to the increase in the price of inputs on the one hand and due to the slowdown in cargo demand -used on the other side.
The difficult times in logistics are also confirmed by publicly available data from the CRIF portal, which monitors the statistics of physical and personal violations for a long time. According to him, a total of 578 companies went bankrupt in the first ten months of this year in the Czech Republic, six more than last year. In the transport and warehousing sector, the numbers – in terms of the total number of companies in this sector – were the worst.
According to Čarný, the usefulness of the new index can be shown in the context of what is happening in Germany, where a third of domestic exports go in the long term and from which which a large number of local investors are coming. Official data in Germany predicts another slight recession in the economy this year, just like last year, and that will hardly remain without a response in the Czech Republic.
The German statistics office said last week that 23 percent more companies fell into bankruptcy in October than last year, and that double-digit growth has continued since the beginning of the year. According to another report from the German central bank, another wave is coming next year, partly due to the accumulation of economic pressure and partly due to the end of the protective measures put in place during covid.
“Data about the German industry shows that it already peaked in 2017. Since then, a steady decline can be seen. The problems have been there for seven years, and now we are only seeing further decline. The index of 5.9 is really good news about the sustainability of Czech companies. But it may fall in the future,” Čarný thinks.
2024-11-28 09:00:00
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What are some potential limitations of using a single index, like the one developed by Deloitte, to measure the complex concept of economic resilience in the Czech Republic?
## Open-Ended Discussion Questions on Czech Economic Resilience
This article highlights the resilience of Czech companies compared to German counterparts, using a new index developed by Deloitte. Let’s explore this topic further with some open-ended questions:
**Thematic Section 1: The New Index and its Implications**
1. **What are the key components of the new index developed by Deloitte, and how accurately does it reflect the health of Czech businesses?** This question encourages discussion about the methodology and limitations of the index.
2. **Economist Jiří Čarný states the index shows Czech companies are more resilient than their German counterparts. What factors might contribute to this difference?** This prompts exploration of the specific economic landscapes of Czechia and Germany.
3. **Do you believe this index will be a reliable indicator of future economic performance for Czech companies? Why or why not?** This challenges participants to analyze the predictive value of the index and consider external factors impacting the economy.
**Thematic Section 2: The German Economy and its Impact on Czechia**
1. **The article mentions rising bankruptcies in Germany. How might this trend directly affect Czech businesses, particularly given their reliance on German exports and investments?** This encourages thinking about the interconnectedness of national economies and potential ripple effects.
2. **Germany is facing several economic pressures, including the after-effects of Covid-19 and the energy crisis. Which of these factors do you think will have the most significant impact on the Czech economy in the coming year?** This invites participants to weigh different economic pressures and their potential consequences.
3. **What measures could the Czech government take to minimize the negative impact of a potential German recession on the Czechirtschaft?** This encourages brainstorming solutions and policy interventions.
**Thematic Section 3: Future Outlook for Czech Companies**
1. **Despite the positive news about Czech resilience, the article suggests the index may fall in the future. What potential threats do you foresee for Czech businesses in the coming years?** This promptsmuscle contemplation of future challenges and risks.
2. **What sectors of the Czech economy appear most vulnerable to the economic downturn? How could these sectors be strengthened to improve their resilience?** This encourages closer examination of specific industries and their vulnerabilities.
3. **Beyond economic indicators like the Deloitte index, what other factors are essential for fostering a healthy and sustainable business environment in Czechia?** This broadens the discussion to address social, political, and environmental factors influencing economic performance.
By structuring the interview with these open-ended questions, we can encourage a nuanced and insightful discussion about the state of Czech businesses and their future prospects.
