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MINISTRY of INDUSTRY and TRADE

Department of Construction and Investment Development

The

CZECH

CONSTRUCTION INDUSTRY

2006

HANDBOOK for PROFESSIONALS

13th Edition

Prague - May 2006

The Czech Construction Industry 2006

The goal of the “Czech Construction Industry” handbook is to provide basic informa-tion about investment development, construction industry and construction materials both to Czech and foreign professionals. Also the handbook can be used as an aid in which are in-cluded standard information provided to partners from other sectors and professions or to institutions, schools etc. in general meaning. Processing of this handbook follows the previous editions and includes following chapters and appendices: I. Gross fixed capital formation, investments and business incentives, housing, transport

infrastructure and direct foreign investments. II. Construction industry (position of construction industry in the national economy, con-

struction market, output and prices, employees and wages, business results). III. Building materials (position of the building materials sector in the national economy,

number and structure of subjects on the building materials market, output, employees and wages, business results).

IV. International comparison of the selected indicators. V. Selected indicators of the Czech Republic. VI. Selected issues from the area of investment and construction processes. Numbers and other information (for example quoted laws and other legal acts,) refer to the period of the end of year 2005, where it was suitable also newer data was used (e.g. for quoted legal acts). The content of this handbook cannot (and also do not want to) substitute the original information sources but provides basic orientation and shows those sources to all who are interested. There are only factual data and explanations without any judgements by which the information can be subjectively influenced. Also the list of companies included in the hand-book has only informative character and cannot substitute original sources. First handbook was made from the initiative of Ministry of Industry and Trade of the Czech Republic 12 years ago. Many experts from construction development and building materials are participating in the processing of the handbook. This edition is based on all preceding editions, it updates original data and adds new data using consultations with experts and in-formation from other institutions. We would like to thank to all who provides any information, data, advises and notices. Prague, May 2006. For the Ministry of Industry and Trade of the Czech Republic made by ÚRS PRAHA, a. s. Contact: [email protected] ISBN: 80-7369-072-1


C O N T E N T BASIC INDICATORS (Table) 9

I

INVESTMENTS AND GROSS FIXED CAPITAL 11

1 Gross fixed capital formation 13 2 2.1 2.2 2.3 2.4 2.5

Investments and business incentives system Investment incentives for manufacturing industry Investment incentives for services and technology centres Incentives application Other business support measures Operational programme for industry and enterprise

16

3 3.1 3.2

Housing Housing construction Governmental support of housing 3.21 State Fund for Housing Development 3.22 Other forms of governmental support of dwellings 3.23 Savings for construction and its governmental support

22

4 4.1

Transport infrastructure State fund of TI and important projects of 2005

31

5 5.1 5.2

Direct foreign investments Foreign investments in the Czech Republic Czech direct investments abroad

34

II

CONSTRUCTION 39

1 Construction industry in national economy and basic trends 41 2 2.1

Construction market Number and structure of construction enterprises

43

3 3.1 3.2 3.3

Construction output and prices Construction output and its structure Potential factors of dynamics 3.21 Building permits 3.22 Orders for construction work Prices of construction works

47

4 4.1 4.2 4.3

Employees and wages Employment 4.11 Employment in the construction sector 4.12 Employees in construction enterprises with 20 or more employees Wages 4.21 Wages in the construction industry 4.22 Wages in construction enterprises with 20 or more employees Productivity of labour

57


5 5.1 5.2

Business results Business results (construction enterprises with 100 or more employ-ees) Enterprises with foreign control

66

III

BUILDING MATERIALS 73

1 Building materials sector in the National economy 75 2 Number and structure of the building materials producers 76 3 Output of building materials 78 4 Employees and wages 81 5 Business results (enterprises with 100 or more employees) 83 IV INTERNATIONAL COMPARISON

87

1 1.1 1.2

General indicators Population Roads and railways

89

2 2.1 2.2 2.3

Gross domestic product Gross domestic product per capita in purchasing power parity Productivity of labour (per 1 employee) Rate of long-term unemployment

91

3 Gross fixed capital Share of GFC in the private sector in GDP

94

4 4.1 4.2 4.3 4.4 4.5

Construction industry Construction in EU Construction output and GDP Year-to-year changes in construction output by type of construction - EU countries Structure of construction output in EU Labour in construction industry Employees of construction industry in year 2005 in EU countries

95

5 5.1 5.2 5.3 5.4 5.5

Housing Stock of dwellings Dwellings by number of rooms Dwellings by floor area Dwellings amenities in % Living in houses and flats and dwelling status

103

V SELECTED INDICATORS of the CZECH REPUBLIC (Tables)

107

1 1.1 1.2 1.3 1.4

Selected macroeconomic indicators of CR Costs and sources of GDP Long-term development of GDP Other indicators Number of subjects registered by the Czech Statistical Office

109


1.5 1.6 1.7

Gross fixed capital formation - factual division Direct foreign investments in the Czech Republic – by countries Direct foreign investments in the Czech Republic – by sectors

2 2.1 2.2

Employment and wages Employment Average nominal monthly wages – 2005

113

3 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8

Housing Stock of houses and dwellings 3.11 Development 3.12 Stock of houses and dwellings structure in 2001 Started and completed dwellings 3.21 Absolute values 3.22 Indices Dwellings by types - started dwellings Dwellings by types - completed dwellings Dwellings by regions Cancelled dwellings Completed dwellings by number of rooms Completed dwellings by floor area

115

4 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10

Construction Construction firms (with 20 or more employees) Output by size and type of firm Output by type of work Building permits - absolute numbers Building permits - indices Orders Employees – current state and development Employees - percentage Monthly wages and labour productivity Construction works prices

120

5 5.1 5.2

Building materials Manufacturing of selected commodities Building materials producers

128

VI APPENDIX

131

1 Brief summary of basic changes in legislative 133 2 2.1 2.2

Construction Code Current legislative 2.11 Landscape planning 2.12 Construction regulations 2.13 Building control department and state building supervision New Construction Code 2.21 Basic principles 2.22 Landscape planning 2.23 Building regulations 2.24 Other 2.25 Building control departments and state supervision and activity of Minis-

try for regional development 2.26 Change act

135


2.3 Expropriation of real property 2.31 According to act No. 50/1976 Coll. 2.32 According to new expropriation act

3 3.1 3.2 3.3 3.4 3.5

Partners and institutions in the construction process Authorized professions in construction Participants of construction process – current conditions Participants of construction process – new conditions Geodetic activities Cadastral area and authorities and real estate cadastre

143

4 4.1 4.2 4.3

Public procurement Current legislative New public procurement act Concession act

147

5 5.1 5.2

Hygiene, health and safety at work Health and safety at work Preservation of health, healthy living conditions and environment, us-ing of building by handicap persons

150

6 6.1 6.2 6.3 6.4 6.5 6.6

Preservation of the environment Water management and water preservation Air preservation Waste management Preservation of nature Preservation of agricultural land and forests Preservation of mineral resources

152

7 Other legal act related to construction 155 8 Strategy of the sustainable development 156 9 9.1 9.2 9.3

Classification of economic activities and products Classification of economic activities (OKEČ/NACE) Standard classification of products (SKP) Classification of types of construction CZ - CC

157

10 10.1 10.2 10.3 10.4

Technical standards and testing European technical harmonisation Attestation of conformity Liability of indemnity Accreditation

161


BASIC INDICATORS

unit 2005 2004 2005/2004

N a t i o n a l e c o n o m y

GDP (at purchase prices) Gross fixed capital formation Gross value added (at basic prices)

bill.CZK current

prices

2 931.1 773.9

2 612.0

2 767.7 743.8

2 467.1

105.9 104.1 105.9

GDP (at purchase prices) Gross fixed capital formation Gross value added (at basic prices)

bill.CZK.prices 1995

1 879.8 600.5

1 689.0

1 771.7 579.0

1 584.7

106.0 103.7 106.6

Employment Average monthly nominal wage of employees

thous. p.CZK

4 803.7 19 030.0

4 732.7 18 035.0

101.5 105.5

Construction industry

Construction work - output

CZK bill.curr. p.

const. p.

422.7 362.1

394.3 347.7

107.2 104.1

Construction work index - - - 103.0 Contractors (registered by Czech Statistical Office) - of which firms of individuals businesses

thous.

269.6 230.4

18.5

263.7 227.7

17.6

102.2 101.2 105.1

Employment thous. p. 457.5 451.1 101.4

Construction firms with 20 or more employees

Construction work - output of which non-financial private firms non-fin. private firms in foreign control

bill.CZK curr. pr.

% %

290.7

79.2 17.8

269.0

80.5 16.8

105.1 *

103.9 111.3

Construction firms of which non-financial private firms non-fin. private firms in foreign control

number

2 498 2 156

131

2 404 2 058

114

103.9 104.8 114.9

Employment Average monthly nominal wage of employees

thous. p.CZK

161.6 18 923.0

154.1 18 233.0

104.9 103.8

Productivity of labour (by contracts) (by own employees)

thous. CZK

curr. pr.

1 798.3 1 351.7

1 745.5 1 240.5

100.2 109.0

H o u s i n g

Dwellings - started - completed

number 40 381 32 863

39 037 32 268

103.4 101.8

* index of output at constant prices Sources: Statistical Yearbooks of the Czech Republic, CZSO Social and economic development indicators of the Czech Republic), CZSO Construction industry in 2004, 2005, CZSO National accounts quarterly of the Czech Republic in 4th quarter of 2005, CZSO Time series 2006, CZSO

9


I

INVESTMENTS

AND

GROSS FIXED CAPITAL

1. Gross fixed capital formation 2. Investments and business incentives system 3. Housing 4. Transport infrastructure 5. Direct foreign investments

The Czech Construction Industry 2006 I - Investments, fixed capital creation

13

I - 1 GROSS FIXED CAPITAL FORMATION

Gross fixed capital formation is defined as: - purchasing of new or existing fixed tangible or intangible assets and non-produced tangible or intangible assets - additions to the value of non-produced non-financial assets (such as sites, subsoil sources, non-cultivated biological sources and water sources and intangible non-produced assets) Gross fixed capital formation consists of resident producers’ acquisitions, less disposals, of fixed tangible or intangible assets characterised by long-term consumption and with the price higher than stated limit, i.e. new investments, costs for large repairs, improvements of invest-ment assets, purchasing or selling of existing investment assets and costs for changing of ownership of investment assets. Excluded are long-term assets purchased by households, as-sets purchased by government for army purposes without possibility of civil use, expenditures for research and development, market surveys etc.

GDP, gross capital (GC) and gross fixed capital formation (GFCF)

c u r r e n t p r i c e s c o n s t a n t p r i c e s (1995) 2001 2002 2003 2004 2005 2001 2002 2003 2004 2005 C Z K b i l l .

GDP GC GFCF

2,315.3 668.6 638.6

2,414.7 674.2 643.3

2,555.8696.1685.6

2,767.7765.8749.9

2,931.1772.9773.9

1,617.9534.3507.6

1,642.0 552.8 525.0

1,703.0 568.3 550.4

1,777.7619.7600.3

1,879.8604.8600.5

p r e v i o u s y e a r = 1 0 0 GDP GC GFCF

107.7 108.1 107.3

104.3 100.8 100.7

105.6103.2105.4

107.9110.0110.2

105.9100.4104.1

102.6106.3105.4

101.5 103.5 103.4

103.2 102.8 104.7

104.4109.0107.6

106.0100.1103.7

G r o s s f i x e d c a p i t a l f o r m a t i o n s h a r e ( %) GDP = 100 GC = 100

27.6 95.5

26.6 95.4

26.697.4

27.297.5

26.499.9

31.4 95.0

32.0 95.0

32.3 96.8

33.996.9

31.999.3

In 2005, the gross fixed capital formation (GFCF) at current prices reached CZK 773.9 bill. and rose by CZK 24 bill., i.e. by +4.1 %, in comparison with 2004. The growth of the GFCF reflected both the growth of the GDP and gross capital. The growth rate of the GFCF exceeded the growth rate of the gross capital but did not exceed its own previous growth in 2000 – 2004. For this reason, the percentage of the GFCF at current prices did not increase.

At constant prices, the GFCF rose by +3.7 %, i.e. by CZK 0.2 bill. to final total CZK 600.5 bill., compared to 2004. Its growth rate is lower then GDP growth rate by 2.3 %, but higher then gross capital growth rate by 3.6 p. p. Therefore its share on GDP decreased by 2 % from 2004, share on gross capital increased to 99.3 %. The GFCF grew up slower than final consumption expenditure (by -0.2 p. p.) at cur-rent prices but more rapidly (by +1.7 p. p.) at constant prices, similar situation is with house-holds and government consumption expenditures.


14

GFCF by sectors

c u r r e n t p r i c e s 2000 2001 2002 2003 C Z K b i l l .

TOTAL Non-financial firms Financial institutions Government insti-

tute. Households Non-profit institute.

594.913405.584

16.48163.331

108.3401.177

638.625425.338

18.84175.202

117.0722.172

643.311412.733

20.86890.392

116.1653.153

685.633 448.286

9.157 111.744 113.807

2.639

share on GFCF ( %) Non-financial firms Financial institutions Government insti-


68.22.8

10.618.2

0.2

66.63.0

11.818.3

0.3

64.23.2

14.118.1

0.5

65.4 1.3

16.3 16.6

0.4 Index: previous year =100 %

TOTAL Non-financial firms Financial institutions Government insti-


- - - - - -

107.3104.9114.3118.7108.1184.5

100.797.0

110.8120.2

99.2145.2

106.6 108.6

43.9 123.6

98.0 83.7

Increase of GFCF from previous year is manly driven by sector of governmental insti-tutions where GFCF reached CZK 111.7 bill, this correspond to the relative growth rate of +23.6 %. In the sector of non-financial institutions the GFCF reached CZK 448.3 bill. and rose by CZK +8.6 bill. On the other side there was a relative fall (CZK -11.7 bill., i.e. -66 %) in the sector of financial institutions. In the long-term analysis, i.e. contrary to the year 2000, there was a change in struc-ture of sectors for GFCF, mainly to the favour of governmental institutions and to the expanse of financial institutions. It means that main “engine” of investment activities was governmen-tal sector and non-financial enterprises. Fall of GFCF in the sector of households is noticeable (more then CZK 3.5 bill. in current prices) but in relative numbers it is fall by 2 % in com-parison to 2002 and in the long-term (comparison to 2000) it even rose by 5 %.

GFCF by economic activity

current prices 2002 2003 2003/2002 C Z K b i l l .

Agriculture, hunting and forestry Mining and quarrying Manufacturing Electricity, gas and water supply Construction Trade, repairs of motor vehicles, household goods Transport, storage and communication Financial intermediation

17.8 10.9

148.6 38.7 22.6 66.1

104.7 21.5

16.6 7.0

157.8 47.0 25.4 61.7

116.8 9.6

93.3 64.2

106.2 121.4 112.4

93.3 111.6

44.7

0

500

1 000

1 500

2 000

2 500

3 000

CZ

K b

ill.

2001 2002 2003 2004 2005Year

GROSS DOMESTIC PRODUCT FORMATION

0

200

400

600

800

CZ

K b

ill.

2001 2002 2003 2004 2005Year

GROSS FIXED CAPITAL FORMATION


15

The most important economic activity from the GFCF point of view was “manufactur-ing industry” with GFCF value of CZK 157.8 bill. (in current prices), that is nearly quarter of total GFCF. Next economic activities with highest share on total GFCF were “transport, stor-age and communication”. Those economic activities created GFCF of more then CZK 100 bill, that is 17 % of total GFCF.

Share on GFCF by economic activity

current prices 2002 2003 GFCF total = 100

Agriculture, hunting and forestry Mining and quarrying Manufacturing Electricity, gas and water supply Construction Trade, repairs of motor vehicles, household goods Transport, storage and communication Financial intermediation

2.8 1.7

23.1 6.0 3.5

10.3 16.3

3.3

2.4 1.0

23.0 6.9 3.7 9.0

17.0 1.4

GFCF by segments

current prices 2000 2001 2002 2003 CZK bill. – current prices

TOTAL - buildings / structures - machinery / equipment - other

561.5 244.7 290.3

26.5

638.6 276.1 321.5

41.0

643.3 273.6 325.2

44.5

685.6 321.0 319.5

45.1 share on GFCF ( %)

TOTAL - buildings / structures - machinery / equipment - other

100.0 43.6 51.7

4.7

100.0 43.2 50.3

6.4

100.0 42.5 50.6

6.9

100.0 46.8 46.6

6.6 GFCF created by buildings and structures in 2003, i.e. GFCF created by construction industry, reached in current prices CZK 321.0 bill., this is 46.8 % of total GFCF. GFCF cre-ated by buildings and structures overtook GFCF created by machinery and equipment by CZK 1.5 bill., that is 0.2 percent points. In comparison with previous year GFCF created by buildings and structures rose rela-tively by 17.3 %, this growth rate is by 6,6 p. p. grater then total GFCF growth rate and by 1.8 p. p. grater then growth rate of the GFCF created by machines and equipment.


16

I - 2 INVESTMENTS AND BUSINESS INCENTIVES SYSTEM

I - 2.1 INVESTMENT INCENTIVES FOR MANUFACTURING INDUSTRY

The investment incentives package for the manufacturing industry was originally approved by the Czech Government in April 1998 in order to make equal conditions for both Czech and foreign investors. This package was further redesigned by the Act on Investment Incentives (No. 72/2000 Coll.), effective May 1st, 2000. This Act simplified and extended the original national incentives scheme. The Act was discussed with the European Commission and there was confirmed that the Act follows European rules on state aid. The Act No. 72/2000 Coll. was amended in January 2002 and further in December 2003 (by the Act No. 19/2004 Coll., which, among others, defines the meanings of the terms “permissible intensity of state aid”, “permissible amount of state aid” and “eligible costs”.) The Act No 72/2000 Coll. in wordings of later amendments has been in force since 1st May 2004. The Investment incentives system includes: • Tax incentives, consisting of income tax relief for new companies (new legal entity has to be established) or partially income tax relief for existing companies, for period up to 10 years. Once the limit of state aid available to the project has been reached, the tax break is termi-nated and the company has to start paying corporate tax. • Job creation grants to support creation of new jobs. Amount of the grant is dependent on the unemployment rate in the district where the investment ought to be realised. It ranges from zero (districts with unemployment rate lesser than the national average) up to CZK 200 000,- (+ CZK 50 thous. per a disabled employee or an employee registered in employment office for more then 6 months) per employee (districts with unemployment rate 50 % or more above the national average). • Training and retraining grants, assigned for training and retraining courses of new employ-ees. Grant covers 35 % of training costs per employee. • Support for the construction of an industrial zone in the form of transferring land with infra-structure or land owned by Czech state at a discount. This aid is granted to municipalities, un-ions of municipalities, regions, developers (i.e. legal persons whose main part of business is related to development and renting of business real estates in the CR) or significant investors who acquired the incentives in compliance with the law. The programme supports the devel-opment of industrial zones, constructions and reconstructions of production halls for rent and regeneration of brown-fields. The purpose of this aid is to prepare conditions for investment projects in manufacturing industry.


17

205 companies used the incentives till the 15th November 2005. Realised investments of those companies should reached of total USD 6.79 bill. and they should generate 48 110 job oppor-tunities. Incentives are subject to the following criteria:

- minimal size of the site 10,000 m2 or minimal 5,000 m2 of unused space of brown-field;

- approved zoning plan for industrial production, commercial activities and services; - sites owned by the receiver of the aid or the State, eventually the investor; - the participation of the State on the budget will not exceed 200 CZK/m2 of industrial

zone area, eventually 1000 CZK/m2 of a brown-field area; - if the receiver of the aid is a developer or significant investor, the project has to be fi-

nanced in such a way that at least 25 % of total project costs are not based on any state aid.

The amount of the aid:

- the difference between the costs for the project preparation and revenues from the pro-ject;

- in case of infrastructure construction or reconstruction of already existing industrial zones, direct subsidy of 75 % of eligible costs for municipalities, districts and regions and 46 % for businesses subjects;

- in case of industrial zones accreditation – maximum of CZK 400,000 (80 % of costs)

* * * Compatibility of the investment incentives rules applied in the Czech Republic with EU state aid legislation is evaluated by the European Commission. Each application for investment in-centives must pass evaluation by the Ministry of Industry and Trade, which also decides on the total amount of state aid available to each project. The actual aid available to each project is calculated as a percentage of the total value of the actual investment (i.e. capital expendi-ture into buildings, machinery and equipment, including expenditure into intangible assets) and is dependent on the location within CR. Maximum percentage of state aid available for particular regions in the Czech Republic is: - 50 % for Central Bohemian and Moravian-Silesian Regions - 49 % for Karlovarský, Ústecký, Olomoucký and Zlínský Regions - 48 % for Liberecký, Královéhradecký, Pardubický, Vysočina and South Moravian Regions - 46 % for South Bohemian and Plzeňský Regions - 20 % for capital city Prague

I - 2.2 INVESTMENT INCENTIVES FOR SERVICES AND TECHNOLOGY CENTRES

Based on Government Decree 1238 of December 10, 2003, the Framework Pro-gramme for Support of Technology Centres and Centres of Business Support Services, the following incentives are offered if appropriate eligibility criteria are met:


18

Eligibility criteria:

- minimum investment of CZK 30 mil. (CZK 15 mil.) and creation of min. 50 (15) new jobs within 3 years;

- at least half of the investment has to be financed by own resources of the recipient; - the results of the technology centre should be materialized in production; - investments and jobs have to be preserved for at least 5 years.

Subsidy for business activity: - paid yearly up to 50 % of eligible business expenses (up to 65 % at SMEs):

- expenditures on tangible and intangible assets within 5 years or - the employees’ two-year average wages within the first 3 years.

Subsidy for training and re-training:

- paid yearly at a level of 35 % (30 % in Prague) of special training costs (i. e. costs for training by which employees gain knowledge and skills which can be used only within the investor’s project and cannot be easily transferred to other employers) and 60 % (55 % in Prague) of general training costs (i. e. costs for training by which employees gain general knowledge and skills which can be used outside the investor’s project)

- max. amount of training subsidy is CZK 100,000 per employee (or CZK 150,000 per employee if the investor creates more than 100 new jobs).

Notes: “Business Support Services” are selected activities of companies characterised by a high proportion of added value, a high proportion of qualified labour, a close relationship with information technologies, a distinctive international focus, in particular customer contact centres, shared services centres, including the regional headquarters of multinational com-panies, software development centres, expert solution centres for information and telecom-munication technologies and high-tech repair centres. “Technology centres”, or design centres, are centres of innovation activities that are closely related to manufacturing. The results of the centre’s innovation activity are expected to be applied in regular production within 3 years from the Project Aid Decision. The typical inno-vation activity of the technology centre would include routine or periodic changes made to products, production series, manufacturing processes, existing services and other operations in progress, even if such changes may represent improvements. No part of the technological centre’s activities may be intended for or depend on the arms industry in any way.

I - 2.3 INCENTIVES APPLICATION

Investors asks for incentives by standard form (Application for investment incentives) submit-ted to the CzechInvest agency. Within 30 days (60 days in the case of incentives for technol-ogy centres or business support services) CzechInvest agency evaluates the application and forwards its proposal for grant to the Ministry of Industry and Trade of the Czech Republic (MIT). MIT asks respective ministries for comments (14 days for comments) and in coopera-tion with the Office for the Protection of Economic Competition (in accordance with EU leg-islation) assesses within 2 – 3 months the permissible intensity and amount of state aid. Upon receiving comments from other ministries, the MIT proposes an “Offer to Grant Investment Incentives“ to the investor. This proposal has to list all available types of incentives (and their


19

amount) and state the conditions for their acquiring. The investor has a 6 months to express his consent with the offer. Once it is accepted, the MIT issues an official “Decision to Grant-ing Investment Incentives“. For details see the “Manual of Investment Incentives“ available at CzechInvest in printed or electronic format.

I - 2.4 OTHER BUSINESS SUPPORT MEASURES For companies/investment projects that for any reason do not fulfil the criteria for the national Investment Incentives Scheme described above there are other forms of support available (none of them includes tax breaks).

Programmes of support for small and medium-sized enterprises (SME) are tar-geted at enterprises with 50 to 250 full-time employees (actual number of employees depends on the program). Next eligibility criteria is volume of revenues and assets. Maximum of 25 % of the SME may be owned by the subject that fails to meet the eligibility criteria. Only al-ready existing enterprises can apply for these programmes. At 2nd April 2006, The Government of the Czech republic approved (by act no.) 353 the program of support for small and medium-sized enterprises involved by the flood in 2006, this program is called REKONSTRUKCE 2006 (Reconstruction 2006). The support is for small and medium-sized enterprises on the area affected by floods to reduce costs with resto-ration. The support is in the form of convenient subsidized bank guarantees to secure the loans. Guarantee is up to 90 % of the loan principal and unpaid interests not greater then 20 % of residual loan principal. Small-sized enterprises with less then 10 employees can ask for do-nation up to 10 % of eligible costs for renovation of business activity but CZK 1 mill. at maximum. Guarantees for bank loans and donations are given by Českomoravská záruční a rozvojová banka, a.s. (Bohemian-Moravian Guarantee and Development Bank). Programmes of support for small and medium-sized enterprises 2005 – 2006, ap-proved by the Government of the Czech Republic by decree no. 1159 from 24th November 2004, including changes in programs conditions approved by the Ministry of Trade and In-dustry valid from 1st January 2006: ZÁRUKA (Guarantee) - The objective of the programme is to provide subsidized bank guar-antees for bank loans, lease plans, and risk and development capital, guarantees for bids in public commercial tenders, and guarantees for operating loans in order to facilitate the im-plementation of the investment-based entrepreneurial projects of small and medium-sized en-terprises, and in order to enhance the competitiveness of these enterprises.

* * *

Národní vzdělávací fond (the National training fund - NTF) runs a variety of human resources development programmes. NTF is the national co-ordinating body for the EU’s Leonardo da Vinci Programme. The program supports training programmes in the Czech Re-public (up to 75 % of total costs), and study stays in EU countries (up to EUR 5,000 per stay).


20

Companies may subtract 10 to 15 % of the cost of new machinery and technologies from their tax base provided they are the first owners or leaseholders. Real estate tax relief for 5 years is offered to companies that switch from coal or oil heating to gas, electricity or other alternative sources of energy to heat their spaces. Export support is provided by:

- CzechTrade, the national trade promotion agency, provides contacts and information on export opportunities worldwide and financial assistance towards market research, export catalogues and establishment of business contacts. Details are available at www.czechtrade.cz.

- The Czech Export Bank (Česka exportní banka) provides Czech exporters with state-supported financing in order to create export conditions comparable to those available to their foreign competitors.

- The Export Guarantee and Insurance Company (Exportní garanční a pojišťovací společnost, EGAP) enables exporters to purchase insurance against risks of non-payment by a foreign customer due to commercial or political risks.

There are over 25 Business Innovation Centres (BIC’s), Science and Technology

Parks and Business Incubators in the Czech Republic. Details are available from the Czech Society of Technology Parks at www.svtp.cz. One of the most important is Technology and Innovation Centre (TIC) founded by Czech Technological University (www.bic.cvut.cz/en). The mission of TIC is to initiate and support the creation and development of small and me-dium-size innovation firms and takes part in a wide range of national and international pro-jects

Investment and business development agency of the Czech Republic CzechInvest was

established in 1992 by the Ministry of Industry and Trade. Its services and development pro-grammes contribute to attracting foreign investment and to developing Czech companies. Its mission is to support investment activities to the highest level of competence not only through the information service and consultancy but also by linkage with structural funds of the EU.

I - 2.5 OPERATIONAL PROGRAMME INDUSTRY AND ENTERPRISE

In consequence with the EU membership of the Czech Republic “Operační program průmysl a podnikání (OPPP)“ (the “Operational Programme Industry and Enterprise“ - OPIE) was established.

The aim of support within the framework of the OPIE is to continue developing a competitive and efficient productive and business potential, to contribute to increased eco-nomic performance, and to support the necessary structural changes in industry and business in order to achieve substantial progress in real convergence during the current programming period. In order to ensure that the set goals are reached, assistance focuses on the develop-ment of small and medium-sized enterprises, on the support of innovative activities in indus-try, and on the production-technology, economic, and organizational restructuring of enter-prises, branches, and sectors. Issues to be tackled also include elimination of old environ-mental burdens, equal opportunities, and the information society. An integral feature in the


21

quest to achieve set goals is an ongoing reduction in costs, achieved in the Czech Republic in particular by increasing the efficiency of energy use.

Operational Programme Industry and Enterprise will be financed by the European Regional Development Fund (ERDF). The financial sources are divided into business environment de-velopment (50 %), development of enterprise competitiveness (46 %) and technical assistance (4 %). OPIE support programmes for 2004 – 2006:

- “START”, “KREDIT” (Credit), “MARKETING”, “INOVACE” (Innovation), “ÚSPORA” (Saving), “ENERGIE” (Energy), “OBNOVITELNÉ ZDROJE” (Renew-able Resources)

- support is in the form of favourable interest-free loans and irreversible subsidies - support can be used to invest to tangible or intangible assets, stocks, technologies, re-

constructions and technical revaluation, etc.

General conditions are at www.mpo.cz or www.czechinvest.cz.


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I - 3 HOUSING

I - 3.1 HOUSING CONSTRUCTION After high numbers of started and completed dwellings achieved in the 70’s and 80’s (in 80’s, the number of completed dwellings per year were about 50 to 80 thousands), these numbers felt down dramatically at the beginning of 90’s. • In 1991 – 1995, the number of annually completed dwellings decreased gradually to less

then 13 thousands in the following five-year period it gradually increased up to 25,207 dwellings in 2000. The growth continued during next years and reached 32,268 dwellings in 2004.

Dwellings: started – completed – under construction

Started Completed Under construction

number index number index number index 1990 1991 1995 2000

61 004 10 899 16 548 29 502

100,0 17,9 27,1 48,4

44 594 41 719 12 662 23 074

100,0 93,6 28,4 51,7

158 840 128 228

66 172 118 785

100.0 80.7 41.7 74.8

2001 2002 2003 2004 2005

28 983 33 606 36 496

39 037 40 381

47,5 55,1 59,8 64,0 66,2

24 759 27 292 27 127 32 268 32 863

55,5 61,2 60,8 72,4 73,7

121 705 129 609 139 132 146 801 155 202

76.6 81.6 87.6 92.4 97.7

Notice: For more detailed data see table no. 3.2 in Chapter V. • The number of started dwellings felt as well, minimum was in 1993 (7,454 dwellings, it is only 12.3 % in comparison with 1990). In contrast to the gradual decrease of dwelling com-pletions, the number of started dwellings dropped suddenly from year to year (from 61,004 in 1990 to 10,899 in 1991). The most dramatic drop was in the cooperative type of dwellings construction. During next years, the number of started dwelling was continually growing; maximum was (till now) reached in 2005 (40,381 started dwellings). In 2005, the number of dwellings under construction equalled to 98 % of those under construction in 1990. (For annual numbers of dwellings starts, finishes and under construction from 1990 see chap-ter V “Selected indicators “.)

STARTED AND COMPLETED DWELLINGS

0

15 000

30 000

45 000

1991-1995 1996-2000 2001 2002 2003 2004 2005

year averages

num

ber

of d

wel

lings

started completed


23

Dwellings by house type and form of development

In family houses In multi-dwelling houses Started dwellings

Develop. type ⇒ cooperative individual other cooperative municipal other 2004 number 2005 number index 05/04 % of total

10 2

20.0 0

16 022 16 143

100.8 98.8

90 192 213.3

1.2

562 423

75.3 3.1

2 012 1 968

97.8 14.5

9 327 11 183 119.9

82.4 Completed dwellings

Develop. type ⇒ cooperative individual other cooperative municipal other 2004 number 2005 number index 05/04 % of total

- - - -

12 475 12 837

102.9 99.2

30 106

353.3 0.8

1 494 1 384

92.6 12.0

3 641 2 430

66.7 21.1

5 587 7 712 138.0

66.9

The individual development of family houses was dominant in 2005; it is same trend as previous years. The importance of “other“ type of multi-dwelling houses development (i.e. private investors and developers) grow up in last years, now reaching about twice the value of started and completed dwellings from 2003. In 2005 this percentage also increased in comparison with 2004 – for finished dwellings it exceeded 2/3 and for started it even exceeded 80 %. The number of started and completed dwelling in this type of development increased substantially from previous year. The number of completed co-operative and municipal dwellings falls in comparison with previous year. The total number of started dwellings, compared to the one of the previous year, increased.

Started dwellings by house type

Total Family h. Multidw.h. FH extens. MdH ext. Com. care Non-r. b. Converted N u m b e r

2000 2001 2002 2003 2004 2005

32 377 28 983 33 606 36 496 39 037 40 381

12 177 12 895 13 659 17 250

17 485 17 579

7 097 6 276 10 246 10 043 11 901 13 574

4 272 3 639 3 600 3 561 3 499 3 141

3 658 2 048 1 850 2 288 1 841

2 103

845 1 357 1 803 1 017 855 527

1 453 1 384 1 225 1 167 1 318 1 932

2 875 1 384 1 223 1 170 2 138 1 525

Percentage from total number of started dwellings 2000 2001 2002 2003 2004 2005

100.0 100.0 100.0 100.0 100.0 100.0

37.6 44.5 40.6 47.3 44.8 43.5

21.9 21.7 30.5 27.5 30.5 33.6

13.2 12.6 10.7

9.7 8.9 7.8

11.3 7.1 5.5 6.3 4.7 5.2

2.6 4.7 5.4 2.8 2.2 1.3

4.5 4.8 3.6 3.2 3.4 4.8

8.9 4.8 3.6 3.2 5.5 3.8

Notes: Family h. - family houses Multidw. h. - multi-dwelling houses FH extens. - extensions of all types, located in family houses MdH ext. - extensions of all types, located in multi-dwelling houses Com. care - community care service homes Non-r. b. - non-residential buildings Converted - dwellings in converted non-residential spaces


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As regards the structure of the started dwellings: • for several years prevailed dwellings in family houses; it was nearly ½ in 2003 but it seems

that this trend is ending. - felt by -1.3 percent points in comparison with 2004 • multi-dwelling houses made the second place in number of started dwellings (13,574), they

reached 33.6 % (rose by + 3.1 p. p. and share on total number rose by 14.1 % compared to the previous year);

- more then 80 % were built by „other“ type of development (82.4 %), 14.5 % by munici-palities and 3.1 % by co-operatives,

- nearly 80% (79.1 %) of dwellings started by municipalities and „other“ type, should be sold after completion, 9.1 % for rent and 6.7 % are social housing flats.

• the percentage of the flats in house extensions was 13.0 %; from those 8.9 % in family

houses,

• the percentage of other types of flats, i. e. flats in community care service homes or sen-iors’ boarding houses, dwellings located in non-residential buildings and in converted non-residential spaces were less significant; their number felt except for the flats in community care service homes.

Completed dwellings by house type

Total Family h. Multidw.h. FH extens. MdH ext. Com. care Non-r. b. Converted N u m b e r

2000 2001 2002 2003 2004 2005

25 207 24 758 27 291 27 127 32 268 32 863

10 466 10 693 11 716 11 397

13 302 13 472

5 926 5 912 6 393 7 720 10 722 11 526

2 911 2 948 2 957 2 486 2 453 2 270

2 339 1 874 1 737 1 454 2 070 1 569

687 708 1 725 1 729

1 638 1 047

745 824 1 070 1 213 719

794

2 133 1 799 1 693 1 128

1 364 2 185

Percentage from total number of completed dwellings 2000 2001 2002 2003 2004 2005

100.0 100.0 100.0 100.0 100.0 100.0

41.5 43.2 42.9 42.0 41.2 41.0

23.5 23.9 23.4 28.4 33.2 35.1

11.5 11.9 10.8

9.2 7.6 6.9

9.3 7.6 6.4 5.3 6.4 4.8

2.7 2.8 6.3 6.4 5.1 3.2

3.0 3.3 3.9 4.5 2.3 2.4

8.5 7.3 6.2 4.2 4.2 6.6

Notes: Family h. - family houses Multidw. h. - multi-dwelling houses FH extens. - extensions of all types, located in family houses MdH ext. - extensions of all types, located in multi-dwelling houses Com. care - community care service homes Non-r. b. - non-residential buildings Converted - dwellings in converted non-residential spaces


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As regards the structure of the completed dwellings:

• for several years prevailed dwellings in family houses but it is falling continuously from 2001; it was 41.0 % in 2005, it rose by +1.3 % but its share fall by 0.2 p.p. from previous year,

- 96 % was targeted for own use of the developer and 4 % for selling after completion (ac-cording to previously mentioned structure of started dwelling, we can expect similar situa-tion with completed dwelling in next years),

- nearly all completed dwellings in family houses were constructed by individual develop-ment

• the share of completed dwellings in multi-dwelling houses rose for nearly 2 p. p. from pre-

vious year; number of those completions rose by +7.5 %, - prevailing is „other“ type of development (66.9 %), it roses by +38.0 % (total 7 712 dwell-

ings) in comparison with previous year, - more then 20 % of dwellings in multi-dwelling houses were built by municipalities

(21.1 %) and its number felt by 35 % (total 2,430 dwellings) in comparison with 2004 - share of cooperative development reached 12 %, it is drop by more then 100 dwellings in

comparison with 2004 (in percentages it felt by 7.4 %, in total 1,384 dwellings) • the percentage of the flats in house extensions (both in family and multi-dwelling) was

15.1 %; it is 11.7 % from total completed dwellings, • the number of completed dwellings in community care service homes and seniors’ board-

ing houses felt by 591 in comparison with 2004 • the percentage of completed dwellings by conversion of non-residential spaces rose by

2.4 % in comparison with 2004 to final 6.6 % and share of dwellings in non-residential houses rose by 0.1 p. p. from 2004

In addition, 21,894 dwelling were modernised in 2005. It is by +6,427 completed modernised dwellings more then in previous year. Because the modernisation of 24,404 dwellings was started (by +21.6 % more then in 2004), we can expect higher number of com-pleted modernised dwellings in 2006.

Dwellings completed in 2004 by number of rooms and area

Avg. number of rooms habitable area in m2 Useful area in m2 family h. multidw. h. family h. multidw. h. family h. multidw. h.

4.39 1.96 97.0 47.5 151.5 66.7 Dwellings started after 2000 have better quality then those started before 1990. Quick development was in the area of built-in products and technical amenities of dwellings (e.g. windows, doors and fittings, bathroom installations, electricity, lights etc.). Dwellings in basic design are on the European level (share of dwellings with public water supply, hot water, bathroom, WC, central heating). Dwelling area, number of rooms, garage availability etc. were significantly less.

Completed dwellings by number of rooms in 2004, in % of total


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Number of rooms (total completed dwellings = 100 %)

Bed-sitters 1 room 2 rooms 3 rooms 4 rooms 5+ rooms Family houses

0.3 0.9 4.6 15.8 33.6 44.8 Multi-dwelling houses

15.1 27.0 28.6 21.9 6.3 1.17 Notes: Completed dwellings without any extensions. 1 room dwellings includes double bed-sitters.

In family houses prevailed dwellings with 5 or more living rooms (completed in last years), about 45 %. Dwellings with 4 or more rooms crossed 78 %. Small falling trend is with smallest dwellings, i.e. bed-sitters or 1 room flats and double bed-sitters but only in family houses. In multi-dwelling houses 1 and 2 rooms flats prevailed, with approximately 27 % share on total; followed by 3 rooms flats (share of those three flat categories reached 77 %). Larger flats reached only about 7.5 %. In long-term period, it is possible to see tendency to shorten the construction time, mainly for family houses where construction time felt from nearly 60 months in 2000 to less then 44 months in 2004.

I - 3.2 GOVERNMENTAL SUPPORT OF HOUSING

I - 3.21 State Fund for Housing Development

In 2000 “Státní fond rozvoje bydlení” (SFRB - the State Fund for Housing Develop-ment) was established by act No 211/2000 Coll., effective from July 21st, 2000. It is an inde-pendent organisation. Its purpose is to form, cumulate and develop financial sources for sup-port of housing investments, and use them mainly for: - construction of flats, preferably rental, - repairs, particularly for panel houses, - construction of municipality technical infrastructure, i.e. for preparation of the sites for fu-

ture house constructions. The SFRB sources are used in the form of: - subsidy for construction of rental houses development, incl. community care service homes

and seniors’ boarding houses - loans to municipalities for repairs or modernisation of dwellings, - subsidy for repairs of panel houses, - loans to natural persons for construction or purchase of dwellings. In 2006, following aids of total amount of CZK 4.1 bill. can be expected:


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CZK - subsidy for construction of dwellings for rent 1,400 mill. - subsidy for construction of flats owned by co-operatives 150 mill. - subsidy for repairs of panel block of flats in emergency conditions 400 mill. - subsidy for interests to loans for construction of non-for-profit housing 100 mill. - subsidy for interests to loans – Program PANEL 400 mill. - subsidy for interests to loans for young families (new born child) 30 mill. - loans to citizens for building a cooperative dwelling 1,050 mill. - loans to citizens for purchasing of dwelling (young marriages, low-income households) 1,370 mill. - loans to citizens for repairs and modernisations 1,000 mill. - loans to municipalities for repairs and modernisations 300 mill.

Support of rental dwellings construction

According government decree no. 481/2000 Coll. as amended, this support has a form of subsidy for paying part of the costs of dwelling construction started initially to the end of 2002, later extended (by decree no. 145/2003 Coll.) to the end of 2003. The budget of SFRB helped to 82 asks in total amount of about CZK 1 bill., it represents 2,722 of dwellings (3,743 dwellings were completed from 2000 to 31st December 2003 for total amount of CZK 1,270.4 mill. and average construction costs per 1 sq. m of dwelling area was CZK 14,788).

Support of rental dwellings construction owned by municipalities

This type of support is directed by government decree no. 146/2003 Coll.. Subsidy is for municipalities to help with construction of dwellings which stays in their ownership. It was designated for dwellings with limited area (80 % of dwellings with area less then 60 sq. m and 80 % with area less then 20 sq. m). 172 projects were approved in 2004 for total amount of CZK 1,433 mill., it represents 2,467 dwellings. In 2005 were approved projects for total amount of CZK 1,134 mill. representing 1,960 dwellings.

Support of repairs of multi-dwelling houses made from panels

This support (called Program PANEL) serves as help for owners of panel multi-dwelling houses for financing complex repairs, modernisations and reconstructions. The pro-gram was realised in accordance with government decree no. 299/2001 Coll. as amended, and SFRB realised it in cooperation with “Českomoravská záruční a rozvojová banka” (ČMZRB, Czech-Moravian Guarantee and Development Bank). Program recognised 3 types of support: - state subsidy for interests (difference between loan repayments represented by lowering of

interest rate by 3 % (4 and 5 % in economically weak regions) and it was designated for complex regeneration)

- bank guarantee for loan (guarantee was given by ČMZRB to applicants for loans without enough guarantee means, guarantee was given up to 70 % of unpaid loan principal from the bank giving loan)

- professional technical and consultancy help (provided by persons certificated by MIT). Subjects by type of ownership which participated on subsidy for interest in 2003 of the total amount of CZK 429.155 mill.:


28

Municipalities Co-operatives Association of owners Natural persons

32.9 % 65.3 % 1.8 % 0.02 % The volume of support increased from 2001 (about CZK 35 mill.) to 2005 (up to about CZK 430 mill.) and supported loan increased from about CZK 120 mill. to about CZK 1,378 mill.. Similar was growth of bank guarantees. There was relatively high decrease of subsidies and supported loans in 2005. Subsidies were CZK 221.7 mill. and supported loan CZK 876.8 mill. Oppositely guarantees increased from initial CZK 6.7 mill. for risk guarantee and CZK 22.3 mill. for bank guarantee in 2000 to CZK 268 mill. and CZK 893.3 mill.

Loans to municipalities for repairs and modernisations of house stock Realisation was based on government decree no. 396/2001 Coll. as amended. It en-ables to municipalities to ask for loans with low interest rate (3 %) with maximal term of ex-piration 10 years. Municipalities affected by floods in 2002 can ask for help with repairs of house stock in the form of loans with 1 % interest rate (according governmental decree no. 397/2002 Coll.). Both mentioned decrees were amended by decree no. 59/2004 Coll., which (among others) defined more precisely: conditions for receiving and use of supports, rules for using flood fund and process of application. There were 203 asks for loans of total amount CZK 2,425.4 mill. from 2001 to 2004. In 2005 there were 14 asks of total amount CZK 59.6 mill. 164 contracts about loans were signed of total amount CZK 844.4 mill. The most number of signed contracts were in Zlínský region (29). The most financial amounts were in Prague (CZK 282.0 mill / 2 contracts) and Královehradecký region (CZK 103.6 mill. / 14 contracts)

Loans to young households for construction of dwelling Based on government decree no. 9/2002 Coll. Loans are determined to person of age less then 36 years and it is possible to use them for construction of flat, family house with 1 flat or for rearranging initially non-residential space into flat. Floor area of the flat cannot exceed 90 m2 (120 m2 in the family house). Interest rate is 3 % and the loan can be up to CZK 200 thous. for maximally 10 years. From 2. 4. 2002 to 31. 12. 2005 there were 1,367 of signed contracts (from that 50 in 2005).

Loans to young families for purchasing of flat or family house

Based on government decree no. 616/2004 Coll. Loans are directed to persons of age less then 36 years who are married or take care of at least one underage child. Loans can be used for construction of family house or flat, for purchasing of family house or flat and also for fees for transferring of right to use cooperative flat (new rental contract has to be signed). Interest rate is 2 % and the loan can be up to CZK 300 thous. for maximally 20 years.


29

I - 3.22 Other forms of government support of dwellings

Following programmes were declared in 2005 to support dwelling construction from the budget of Ministry of local development: - Support of regenerations of panel houses settlements for gradual change of current mono-

functional settlements - Support of construction of flats for rent and technical infrastructure - Support of construction of social dwellings owned by municipalities - Support of repairs of panel blocks of flats

I - 3.23 Saving for constructions and its government support

Saving for constructions and its government support is directed by Act no. 65/2004 Coll. Ac-cording this Act, saving for constructions is defined as accepting the deposits, providing loans and providing benefits to participants of saving for constructions. Act (among others) defines duration of saving period, time of waiting for obtaining of loan and conditions of government support (from government budget). There was amendment which changed contracts signed after 1. 1. 2004 as follows: - Participant of saving for constructions can be any natural or corporate person, including

foreigners – citizens of EU countries (other conditions are stated by the law) - Government support is 15 % of saved amount in particular year. Maximal value is CZK

3,000 for saving at least CZK 20,000 (previously it was CZK 18,000 with maximal gov-ernmental support CZK 4,500).

The last amendment to the law about savings for constructions came in force at the beginning of October 2005. Mainly it states the value of fees for savings for constructions.

Basic indicators of development of savings for constructions in the Czech Republic

1997 1998 1999 2000 2001 2002 2003 2004 2005 Number 530,176 638,232 906,867 1,115,926 1,373,258 1,293,890 2,097,338 314,650 430,233

New signed contracts Increment (%) 20.4 42.1 23.1 23.1 -5.8 62.1 -85.0 36.7 Amount

(thous. CZK) 143.2 145.3 144.2 139.4 136.9 146.7 200.5 222.8 227.9 Average target value of new signed contracts Increment (%) 1.5 -0.8 -3.3 -1.8 7.2 36.7 11.1 2.3

Number 1,967,849 2,371,816 2,801,389 3,424,580 4,196,408 4,870,620 6,300,831 5,899,300 5,573,874 Contracts in the saving stage 1) Increment (%) 20.5 18.1 22.2 22.5 16.1 29.4 -6.4 -5.5

Amount (bill. CZK) 3.817 5.068 6.393 7.719 9.313 11.059 13.261 15.337 16.086

Granted government support Increment (%) 32.8 26.1 20.7 20.7 18.7 19.9 15.7 4.9

Amount (CZK) 2,795 2,803 2,795 2,874 2,956 3,138 3,159 3,256 n/a Average value of granted government support Increment (%) 0.3 -0.3 2.8 2.9 6.2 0.7 3.1

Amount (bill. CZK) 59.552 81.731 93.629 110.400 133.309 180.190 236.815 287.077 328.987

Saved value 1) Increment (%) 37.2 14.6 17.9 20.8 35.2 31.4 21.2 14.6 Loans at total 1) Number 81,870 187,245 286,942 373,463 465,824 568,920 685,740 786,483 857,875 it that: from savings for constructions 21,554 70,377 167,687 262,259 346,145 420,929 488,850 549,698 582,867 bridging loans 2) 60,316 116,868 119,255 111,204 119,679 147,991 196,890 236,785 275,008 Increment (%) 128.7 53.2 30.2 24.7 22.1 20.5 14.7 9.1

Loans at total 1) Amount

(bill. CZK) 5.936 17.669 26.346 31.011 37.023 46.308 63.597 84.184 108.063 it that: from savings for constructions 0.712 2.790 8.416 14.207 18.522 21.916 25.099 28.735 31.751 bridging loans 2) 5.224 14.879 17.930 16.804 18.501 24.392 38.498 55.449 76.312 Increment (%) 197.7 49.1 17.7 19.4 25.1 37.3 32.4 28.4

Loans at total / saved value Ratio (%) 10.0 21.6 28.1 28.1 27.8 25.7 26.9 29.3 32.8 1) At the end of the period 2) Loans according to § 5 para. 5 of Act no. 96/1993 Coll., about saving for living and its government support, as amended


31

I - 4 TRANSPORT INFRASTRUCTURE The current transport infrastructure projects exceed one quarter of all construction work and more then 50 % of all orders for construction work. Transport infrastructure includes: - constructions, repairs and maintenance of highways, motorways and roads, - constructions, repairs and maintenance of railways, - development of water management structures, water and air transport infrastructure. At the end of the 90’s: • The length of railways reached 9,400 kilometres and the density was 12 km per 100 sq. km; - CZK 160.5 bill. (of which CZK 12 bill. for repairs and maintenance, CZK 150 bill. for new

investments) are necessary to reach the „standard state“, i. e. the re-establishment and refur-bishment of depreciated facilities and upgrading of the railways infrastructure;

- CZK 20.6 bill. (of which CZK 6.3 bill. for repairs and maintenance, CZK 14.2 bill. for new investments) are necessary to maintain the current state.

• The length of roads (of all categories, incl. highways) reached 128,000 km (of which mo-torways 325 km and highways 489 km) and the density was 162 km per 100 sq. km; - in 2000 the percentage of the road transport exceeded 86 % for persons transport and 68 %

for goods transport; the working load of roads and highways grew up by +52 % in compari-son with 1990; the higher safety of the road traffic will need higher financial sources, e.g. for roundabout crossings or overpasses, etc.

• The waterways have been without any development for long time The Czech Republic belongs by - length of road net (all categories, including highways) to the level of Netherlands, Austria or

Sweden and by its density to the level of Denmark, United Kingdoms or Switzerland - length of railways to the level of Spain or Sweden and by its density to the level of Belgium,

or Germany Recession is significant in the length and density of highways and in the quality of railways which are unsuitable for high speed. The road and highways development is funded by the ‘Státní fond dopravní infra-struktury’ - SFDI (the State Fund of the Transport Infrastructure). The Fund was established through the Act No 104/2000 Coll. as amended. The Fund is directed by the Ministry of Transport. The Fund uses its revenues for development, construction, maintenance and mod-ernisation of roads and highways, railways and inland waterways.


32

For 2005 – 2013 is state politics about transport infrastructure directed by government decree No. 882 from 13th July 2005. One of the main points is to assure transport infrastruc-ture of high quality, mainly by:

1. maintenance and renovation of current transport infrastructure 2. construction and modernisation of transport infrastructure

I - 4.1 STATE FUND OF TRANSPORT INFRASTRUCTURE AND IMPORTANT PROJECTS OF 2005

“Státní fond dopravní infrastruktury” (SFDI, State fund of transport infrastructure) is directed by Act no. 104/2000 Coll. which came in force in 1st July 2000. The purpose of the fund is to develop, construct, maintain and modernise roads and highway, railways and inland waterways. Beside the financing of construction and maintenance, the fund also provides con-tributions for survey and project works, study and expert activities focusing on transport in-frastructure.

Among incomes of the fund belong road tax, consumption tax from hydrocarbon fuels

and lubricants and charges for using of highways. The SFDI also uses financiers from Euro-pean funds. Residue finances on the end of the year are transferred to the following year.

The SFDI is directed by committee of 9 persons appointed by the government for E4 years and it is chaired by the minister. The committee can among others appoint and recall the director of the fund, approve the purpose of the budget, approve time plans of the incomes and expenditures, approve yearly program of tenders for realisation of the investments.

The supervisory board is composed of 5 persons appointed by the Parliament for 4 years. The board is controlling body of the fund and supervises all activities of the fund. The director of the fund is appointed by the committee and manages all activities of the fund.

The budget of the SFDI for 2005 (including residual finances from 2004) was CZK 55

bill. on the income side and to 31st December 2005 it was decreased to CZK 52 bill. (at the expanse of EU finances). The budget was composed form 29 % of tax incomes and from 66.5 % of subsidies from the National fund of CR property. Total expenditures of the SFDI reached CZK 48.5 bill. at the end of 2005 (from that 38.8 % for railways, 34.6 % for highways and 25.5 % for roads). Among important activities realised in 2005 belong: - sections of highways D1, D3, D5, D8 and D11 and freeways R1, R6, R7, R35 and R48 - modernisation and optimization of sections I. and II. of train corridors and their connection


33

Structure of financial sources

Bill. CZK 2002 2003 2004 2005 SFDI 38.88 41.21 51.87 48.20 Co-financing sources 7.57 9.36 9.58 10.11 from that: sources form EU 0.37 0.70 0.74 0.46 loans 6.90 8.05 7.92 8.16 other sources 0.30 0.61 0.92 1.49 TOTAL 46.45 50.57 61.45 58.31 The most important programs (by the financial amount) financed by the SFDI in 2006 are: - construction and renewal of I., II. and III. class roads, road net of corporate towns, free-

ways and highways - D1 (Vyškov – Lipník), D3 (Praha – České Budějovice – state boarder), D5 (by-road of

Plzeň, Černice – Útušice), D8 (Trnice – state boarder), D11 (Poděbrady – Hradec Králové)

- R1 (Prague road perimeter), R35 (Hrádek nad N. – state boarder with Poland, by-road of Holice and Vysoké Mýto), R4 (Skalka – road II/118, cross-road I/20 – R4 by Nová Hospoda), R48 (by-road of Frýdek-Místek, Frýdek-Místek – Rychaltice), R6 (Sokolov – Tisová – Kamenný Dvůr, Karlovy Vary – Olšová Vrata), R7 (by-road of Sulec, Chomutov - Hora sv. Šebestiána)

- reconstruction and modernisation of chosen railways, modernisation of sections II., III. and

IV of railway corridors and increase of railway safety - electrification of the section Kadaň – Karlovy Vary, I. corridor (Zábřeh – Červenka),

III. corridor (Přerov – Olomouc, Plzeň – Stříbro), IV. corridor (Benešov – Strančice – Praha Hostivař), rail junctions (Brno, Prague, Ústí n.L.), optimalisation of railway sec-tion Břeclav – state border with Slovak

- support of waterways development

- improvement of Labe channel, reconstruction of canal locks - construction and maintenance of bicycle roads


34

I – 5 DIRECT FOREIGN INVESTMENTS

I – 5.1 FOREIGN INVESTMENTS IN THE CZECH REPUBLIC At the end of 2004 the amount of direct foreign investments (DFI) reached CZK 1,280.6 bill. (i.e. USD 57.3 bill. 1USD=22,365CZK or EUR 42.0 bill. 1USD=22,365CZK) in the Czech Republic. Nearly two thirds were basic capital and one third was reinvested profit.

Since the beginning of 1993, the DFI have grown constantly, except for 2003, when there was a decrease by approximately 3.7 bill. CZK. The reason was back purchase of the Eurotel shares from the foreign investor and the selling of the international share of Český Telecom to portfolio investors. It resulted to decrease of the DFI by – 0.3 %. These transac-tions also affected the structure of the DFI. The percentage of transport and telecommunica-tions compared to the total DFI decreased from 11 % at the end of 2002 to less than 6 % at the end of 2003. Compared to previous years there were no distinctive one-shot investment in 2004 but the growth was spread into investments to more economic sectors.

Direct foreign investments in the Czech Republic

Basic capital Reinvested profit

Other Total

CZK bill. previous year = 100

To 1.1.1993 83,488.7 84,488.7 - 1995

2000 2001 2002 2003 2004

195,526.3 641,391.6 706,410.0 798,060.8 767,018.3 800,580.3

60,826.2 131,127.3 215,042.1 242,373.5 321,262.0

116,193.8 144,797.7 152,426.2 152,391.8 158,752.5

195,526.3 818,411.6 982,335.0 1 165,529.1 1 161,783.7 1 280,594.8

-

129.9 120.0 118.6 99.7 110.2

At the end of 2004 there were 66 investors in total in the Czech republic, 35 from

European countries (including self-governing territories like Guernsey, Jersey) – 24 from EU countries, 12 from North, South and Central America, 3 from Africa countries, 14 from Asia countries and 2 from Oceania countries. Some of the foreign investors form the USA, Japan and some others invest to the Czech republic through 3rd country (mainly through filial com-panies in the Nederland, Luxembourg or Cyprus). Percentage of particular economic zones was as follows: OECD European union EFTA and other Europe countries Africa

96.7 % 84.9 % 4.3 % 0.2 %

North America Central and south America Asia Oceania and Polar regions

5.8 % 0.5 % 1.8 % 0.0 %


35

The most important investor countries in 2004 were same as in previous years, it was

Nederland and Germany with more then 50 % share on total DFI. Among other most impor-tant investor countries belongs Austria, France, USA, Belgium, United Kingdoms and Swit-zerland, their common share on DFI was 33.1 %. Netherlands Germany Austria France

32.6 % 20.6 % 11.2 % 6.6 %

USA Belgium UK Switzerland

5.2 % 3.8 % 3.7 % 2.6 %

The major investments were into banking and insurance (17 %), followed by com-merce and repairs (over 11 %). Total 63.2 % of the DFI is allocated in 8 branches. Banking and insurance Commerce and repairs Motor vehicles Electricity and gas supply

16.5 % 12.4 % 7.5 % 6.7 %

Transport and telecommunications Metal. metal products Real estates and services for comp. Services. mainly for companies

6.2 % 5.3 % 5.3 % 5.0 %

At the end of 2004, over 55 % of DFI were located in Prague (compared to the previ-

ous year it was increase of the 10 percent points.), over 13 % in Central Bohemia Region. The percentages of other regions were between 0.8 and 6.0 %.

Location of DFI by regions

Regions (in %) Pha StČ JČ Plzeň KV ÚL Lb HK Pa Vys JM Ol Zl MSl 54.8 13.3 2.3 2.6 0.8 4.2 2.4 1.4 1.9 1.8 5.0 1.9 1.6 6.0

DFI in construction industry, mining and quarrying and manufacture of non-metallic mineral products

As in previous years, construction industry was not very attractive for foreign

investors - DFI in construction industry reached approximately CZK 23.4 bill. at the end of 2004, i.e. 1,8 %. Share of DFI in construction industry on total DFI decreased by 0.5 percent points.

DFI in construction industry Basic capital Reinvested profit Other capital Total bill. CZK % bill. CZK % bill. CZK % bill. CZK % 16.426 67.0 9.302 38.0 -1.23 -5.0 24.498 100.0

Investors from 18 countries invested in total in the Czech Republic – 14 form EU countries and 1 from other European country, 2 from North, South and Central America and 1 from Asia.


36

DFI in construction industry by country of the investor EU + other Euro-pean countries

Germany ( 5,542.1) Austria (4,855.2) France (4,371.9) Sweden (3,612.4) Slovakia (2,456.3)

Switzerland (1,010.1) Nederland (958.7) UK (271.3) Luxembourg (181.3) Italy (43.0)

Cyprus (43.0) Finland (25.1) Denmark (13.8) Poland (2.8) Croatia (-1.2)

America Surinam (20.4) Panama (18.5) Asia Israel (-0.4) Note: In brackets is DFI in mill. CZK of respective country.

From economic activities including mining, quarrying and production of building ma-terials are more important and more interesting form the DFI point of view “Manufacture of other non-metallic mineral products.” There invested investors from 17 countries – 12 from EU. Share on the DFI made by manufacture of other non-metallic mineral products was 3.9 %, it was decrease by 1 percent point from 2003. Second economic activity – “Quarrying and mining” – have share 0.4 % on the total DFI and there invested investors form 10 countries – 8 from EU countries.

DFI in quarrying and preparation of minerals other non-metal mineral raw-materials Quarrying and mining Manufacture of other non-metallic mineral

products EU Nederland (2,542.7)

Austria (1,764.2) Germany (468.2) Belgium (373.6)

Sweden (15.0) Poland (1.3) Slovakia (0.05) Hungary (-1.0)

Nederland (19,764.3) Germany (15,236.1) Austria (8,574.6) France (1,468.1) Italy (1,373.9) UK (1,331.6)

Spain (653.5) Cyprus (77.2) Portugal (45.9) Poland (25.2) Hungary (11.7) Slovakia (-7.2)

Other European countries

Croatia (-0.1) Guernsey (-1.1) Switzerland (398.5) Lichtenstein (26.5)

Croatia (-3.4)

America Neloze (328.9) Asia Japan (228.6) Note: In brackets is DFI in mill. CZK of respective country.

I – 5.2 CZECH DIRECT INVESTMENTS ABROAD

At the end of 2004, Czech direct investments abroad (CDI) reached CZK 84.1 bill. (i.e. USD 3.8 bill. 1USD=22,365CZK or EUR 2.8 bill. 1EUR=30,465CZK). Since 1993, the amount of CDI continuously increased; the highest growth was in 2001 and 2004. Over 80 % of the total investments were basic capital; reinvested profit reached negative values in 2000 and 2002.


37

Prevailing part of Czech investors´ filial companies were established with the purpose to place free financial means or provide sales of the production abroad, i.e. to manage foreign activities or to optimize taxation (which can be presupposed in case of investments located in Cyprus, British Virgin Isles, Liechtenstein as well as in the Netherlands or Luxembourg; the amount of the FDI in these countries represents 50 % of the total amount). Establishing of production units was less frequent (mainly in Slovakia). Also so called companies of special determination are established abroad; these are used for managing assets or for gaining finan-cial means in foreign capital markets.

Czech direct investments abroad

Basic capital Reinvested

profit Other capital Total

Mill. CZK previous year = 100

To 1.1.1993 2,634 .0 2,634.0 - 1995 2000 2001 2002 2003 2004

9,190.1 28,110.7 34,685.0 47,080.5 48,521.3 57,168.7

- 3,313.2 2,948.6 - 7,588.4 2,444.2 13,495.2

3,101.8 3,543.5 4,925.0 7,616.0 13,423.4

9,190.1 27,899.3 41,176.1 44,397.1 58,581.5 84,087.3

- 111.1 147.6 107.8 131.9 143.5

At the end of 2004 Czech direct investments were located in total 59 countries - 24

EU countries, 9 other European countries, 1 Africa country, 9 America country, 14 Asia and Australia countries. The percentage of particular economic zones were as follows: OECD European Union (EU25) EFTA Other European countries Africa

51.5 % 24.3% 7.6% 14.3% 0.0%

North America Central and South America Asia Oceania and Polar regions

0.6 % 3.7% 18.6% 0.1%

In 2004 Czech investments targeted especially into Slovakia, the Netherlands, Cyprus and United Arab Emirates. Their percentage exceeded 45 %. The most important Czech direct investment abroad was entering of ČEZ to distribution company in Bulgaria.

Among the 8 countries in which the investments made nearly 80 % of the total Czech investments abroad belonged (Russia for the first time): Slovakia Netherlands Cyprus United Arab Emirates

22.2 % 11.5% 11.4% 8.5%

Bulgaria Lichtenstein Luxembourg Russia

8.4 % 6.0% 5.5% 3.6%

Czech direct investments abroad were located into 41 economic activities, mainly banking and insurance which had 43 % share on total CDI at the end of 2004 (in comparison with previous year it was decrease by more then 10 percent points).


38

Banking and insurance Commerce and repairs Services, mainly for companies Electricity and gas supply Mnf. of crude oil and chemical products

40.5 % 19.1 % 1.1 % 8.4 % 5.5 %

Mnf. of non-metallic mineral products Real estate business services Mnf. of food and beverages

2.0%

1.9% 1.5%

CFI in construction industry, mining and quarrying and manufacture of non-metallic mineral products

The investments in construction industry reached 1.276 bill. CZK, which was 1.3 % of the total amount; fife sixths of this was represented by basic capital and reinvested profit Three quarters of all Czech investments abroad was basic capital, the other one sixth repre-sents the reinvested profit and other capital.

The investments in “manufacturing of other non-metal mineral products” were rather

higher (1,745 bill. CZK, i.e. 1.3 %). The investments in “mining, quarrying and preparation of other mineral raw-materials” reached CZK 336.5 bill., i.e. 0.4 % of total investments.

Sources to Chapter I.: Quarterly national accounts of the CR in 4th quarter of 2005, CZSO Statistical yearbooks of the Czech Republic, CZSO Dwelling development, CZSO Programmes of dwelling support for 2006, Ministry of regional development The budget of SFRB for 2006 Purpose of dwelling policy, Ministry of regional development, January 2006 Yearly activity report of SFDI for 2005, SFDI, March 2006 Yearly activity report of SFRB for 2005, SFDI, March 2006 Direct foreign investments 2004, CZSO Quoted laws, decrees and other legal acts


II

C O N S T R U C T I O N

1. Construction industry in national economy and basic trends

2. Construction market 3. Construction output and prices 4. Employees and wages 5. Business results

The Czech Construction Industry 2006 II - Construction

41

II - 1 CONSTRUCTION INDUSTRY IN NATIONAL ECONOMY AND BASIC TRENDS

The construction industry is one of the most important economic branches in the Czech Republic and can be considered as one of the pillars of the economy, when - producing approx. 7 per cent of the value added (at current prices), - employing approx. 9 per cent of labour force of the civil sector and the employment in the branch is long-term, - having important share in fixed capital formation; its creation is one of the growth factors of the all economy. During the process of economic transformation the construction industry proved its ability to adopt to market conditions: - facing up to changes in demand, restructure in production base same as - claims to higher quality and architectural level of housing structures - successfully follow European trends in all main sectors of construction industry Construction industry - holds on to own production and economical potential, to know-how of foreign partners,

which are important owners of the biggest construction companies with residence in Czech Republic.

- creates market structure, in term of size of companies and its legal forms, which is created from classical supplier-consumer relationships with wide background of sub-suppliers, de-veloper companies, architects, designers and with links to activities in property market.

- participate significantly on regeneration of Czech economy - in some activities is on the same level or almost the same as construction in EU countries. Construction sector cause a multiplying effect when influencing so as the demand for prod-ucts from other sectors (construction industry consumed products and services of other sec-tors in bulk volumes, the amount of which is approximately CZK 200 bill. a year) as follow-ing services connected with maintaining of buildings. this all generates revenues to the State budget and long-term effect to the State finance (payment of debts) and services

In the long-term horizon, construction industry indicates further development of the economy ahead of time. In the second half of 90´, civil engineering became the most important sector, thanks to public sector contracts, particularly contracts for surface transport infrastructure projects. Civil engineering took over from non-dwelling, non-production buildings, which were the most significant segment of the market in the first half on 90´. Due to boom in banking sector; the decrease of its investments was partly compensated with investments of foreign retail chains. Foreign investments are becoming very important source of funding of investments and construction works. The rate of residential buildings, which is in foreign economies usu-ally at top, is still low in Czech Republic.


42

Despite the positive growth of the construction work profitability, a low profit level of construction companies persists. Lack of own capital, especially of SMEs persists as well, which makes their access to loans and their position in tenders difficult (as high guaranties and / or co-financing are required).

* * *

After 1990, transformation changes resulted in substantial real decrease of construction production, with the minimum in 1993. Between 1994 and 1999, there was a cyclic development, with growth in 1994 – 1996 and recession in 1997 – 1999. In 2000, a period of revitalisation and growth started which continued through next years, in spite of decrease of the dynamics; the year 2005 is the sixth year of continuous growth.


43

II - 2 CONSTRUCTION MARKET

II - 2.1 NUMBER AND STRUCTURE OF CONSTRUCTION ENETRPRISES

In December 1999 more than 200,000 firms with prevailing construction activity

(corresponding to Division 45 of the NACE-CZ Classification), i.e. "construction firms", were registered by the Czech Statistical Office (CZSO). In December 2002 the number of registered construction firms reached 241,303 entities and 256,273 bodies were registered in December 2003. The percentage of construction firms, both firms of individuals or businesses, achieved 11 per cent of all registered bodies. In 2004, both the number of registered economic entities, and construction companies decreased (to 2,213,904 and 248,991), in year 2005 the number increased again up to 2.388.490 registered economic entities and up to 269.625 in construction companies.

Number and structure of construction enterprises to Dec. 31st, 2005

number % All firms registered by the Czech Statistical Office 2,388,490 100.00 - Firms with the prevailing construction activity (OKEČ 45) 269,625 11.29 - of which 100.00 - Individual contactors total - of which registered in the Commercial Register

230,419 2,899

85.46 1.08

100.00 1.26

Business companies - incl. joint stock companies limited liability companies

18,532 824 16,564

6.87 0.31 6.14

100.00 4.45

89.38 Co-operatives State enterprises

509 61

0.19 0.02

- -

According to chosen legal forms there were in construction sector in the end of 2005: - 230,419 individual contractors (85.5 %), of them registered in the Commercial Register

2,.899 (1,1 %), - 18,532 commercial companies (6.9 %), of them 824 joint stock companies (0,3 %) and

16,564 limited liability companies (6.1 %), - 509 co-operatives (0.2 %) and - 61 state enterprises (0.02 %).

Number and structure of construction enterprises by sectors in year 2005

Total Public sector Private sector - foreign control Households number

% 269,625

100.00 107

0.04 41,607

15.43 24,083

8.93 227,766

84.48 By sectors, there were: - 107 enterprises of public sector (0.04 %), - 41,607 enterprises of private sector (15.4 %), of them 24,083 enterprises foreign-controlled

(8.9 %) and - 227,766 enterprises in households sector (84.5 %; households sector includes households as consumers and contractors as manufacturers working under The Trades Licensing Act)


44

* * *

Construction enterprises with 20 or more employees by sectors

Non-financial

public ent. Non-financial private ent.

Non-fin private foreign-cont.

Households sector

Total

2000 2001 2002 2003

number

12 10 7 5

1,884 1,860 1,920 1,921

51 89 96 97

369 251 219 224

2,216 2,210 2,242 2,247

2004 2005

number

%

6 7

0.3

2,058 2,193 86.7

114 133

5.3

226 196

7.8

2,404 2,529 100.0

In structure of institutional sectors according to national account procedure, the non-financial private enterprises under Czech control had strongly prevailing part. The importance of non-financial private enterprises foreign-controlled was increasing because of its increas-ing number and also it consist mostly great enterprises. Building enterprises with 20 or more employees by legal status

Private enterprises Enterprises total unregist. registered unl. part. ltd. j. stock co-op other

percent - y e a r 2 0 0 5 98.6 7.5 1.7 1.2 73.9 13.6 0.8 0.5

unregist. – contractors - individuals, unregistered in Commercial Register registered. -registered in Commercial Register unl. part. = unlimited partnerships From whole number of building enterprises with 20 or more employees there were in 2002 a 2003 private enterprises the rate of 98.6 %. In the year 2004 the rate increased to 98.7%, but in the year 2005 decreased again to 98.6% In year 2005 there were 2,498 building enterprises with 20 or more employees. There were mostly limited liability companies in the year 2005 with number 1.847 (from whole number of building enterprises with 20 or more employees 74 %). The second most numerous category is joint-stock companies (339, it’s . 13.6 %), following by individual contractors. Other enterprises are less important in number.

Number of construction enterprises with 20 or more employees

1997 1998 1999 2000 2001 2002 2003 2004 2005 2,370 2,408 2,316 2,216 2,210 2,242 2,247 2,404 2,463

The important economical position of building enterprises with 20 or more employees result from its rate on whole building production (about 70 %) and also on total employment. Their number is in last years stabilized over the border of 2,200 subjects, in year 2004 almost crossed 2,400 subjects and in the year 2005 crossed also 2,460 subjects.: The greatest building enterprises, due to year sales, assets volume, resp. due to number of employees in the year 2004(data for year 2005 will be published in second half of year 2006), are:

ENTERPRISES BY SECTORS number of enterprises in sector

107

41 607

24 083

227 766

publicprivateforeign-controlledhouseholds

ENTERPRISES WITH 20+ EMPLOYEES BY SECTORS

number of enterpises in sector

72 193

133

196

publicprivateforeign-controlledhouseholds


45

Sales Assets Number of employees order CZK bill order CZK bill order personSkanska CZ a.s.* 1. 29.462 1. 21.581 1. 4,413 Metrostav a.s.* 2. 19.579 2. 12.026 2. 4,573 Stavby silnic a železnic, a.s.* 3. 18.317 3. 10.219 3. 4,650 STRABAG a.s. 4. 14.466 4. 9.058 4. 6,334 ŽS Brno, a.s. 5. 8.071 5. 3.812 5. 4,003 IMOS Brno, a.s. 6. 5.244 10. 2.433 11. 5,663 HOCHTIEF VSB a.s. 7. 4.728 8. 2.676 6. 2,942 GEOSAN GROUP a.s. 8. 4.081 7. 2.692 26. 10,075S u b t e r r a a.s.*** 9. 4.029 12. 1.938 12. 4,663 VCES a.s. 10. 3.085 6. 3.014 9. 2,932 TCHAS, spol. s r.o. 11. 2.617 14. 1.793 7. 1,856 COLAS CZ, a.s. 12. 2.449 15. 1.342 13. 2,854 SYNER, s.r.o. 13. 2.404 9. 2.436 35. 7,961 UNISTAV a.s. 14. 2.345 13. 1.863 19. 4,318 PSJ holding, A.S. 15. 2.283 18. 1.145 37. 7,983 KONSTRUKTIVA KONSIT a.s. 16. 2.124 17. 1.169 31. 5,618 Pražské silniční a vodohosp.stavby, a.s. 17. 1.893 20. 1.127 15. 2,685 GEMO OLOMOUC, spol. s r.o. 18. 1.808 29. 0.601 32. 4,820 SMP CZ, a.s. 19. 1.774 19. 1.137 16. 2,617 BAK a.s. 20. 1.635 22. 0.986 18. 2,645 VOKD, a.s. 21. 1.588 23. 0.937 8. 1,230 Dálniční stavby Praha, a.s. 22. 1.530 11. 2.290 41. 5,690 SWIETELSKY stavební s.r.o. 23. 1.514 27. 0.702 20. 2,975 M - Silnice a.s. 24. 1.474 21. 1.049 17. 2,359 P r ů m s t a v , a.s. 25. 1.471 28. 0.624 22. 3,185 Elektrizace železnic Praha a.s. 26. 1.456 16. 1.317 14. 2,056 NAVATYP a.s. 27. 1.216 26. 0.737 34. 3,629 Energie - stavební a báňská a.s. 28. 1.007 24. 0.826 10. 1,054 FIRESTA-Fišer, rekonstrukce, stavby a.s. 29. 0.933 32. 0.486 27. 2,314 Českobudějovické pozemní stavby spol. s r.o. 30. 0.931 40. 0.309 28. 2,315

Structure of building enterprises by number of employees

2000 2001 2002 2003 2004 2005 Number of empl. percentage

20 - 24 25 - 49 50 - 99

100 - 499 500 - 999

1000 or more

19.3 43.9 22.4 13.1

0.8 0.4

19.1 45.5 22.0 12.3

0.8 0.4

19.8 46.0 22.1 11.6

0.7 0.4

20.0 45.5 22.3 11.3

0.6 0.4

24.3 43.8 20.5 10.4

0.6 0.4

25.0 43.6 20.3 10.2

0.6 0.4

During the nineties the rate of small enterprises(up to 49 employees) increased and the rate of middle-sized and great enterprises decreased.


46

II - 3 CONSTRUCTION OUTPUT AND PRICES

II -3.1 CONSTRUCTION OUTPUT AND ITS STRUCTURE Development of building production volume

constant prices (as at 2000) current prices CZK bill. previous y. = 100 CZK bill. previous y. = 100

2000 2001 2002 2003

2004 2005

258.9 283.8 290.9 317.0 347.7 362.1

105.3 109.6 102.5 108.9 109.7 104.2

259.7 295.7 311.2 346.8 394.3 422.7

109.3 113.8 105.2 111.4 113.7 107.2

The year 2000 can be considered the first year of construction market revitalisation. Since that time, construction works have been growing for 5 years already. Structure of construction works by type of production

2001 2002 2003 2004 2005* % from whole volume of made construction works

Work abroad inland of inland work: - new * - repairs/maint. - other

2.0 98.0

74.1 23.0

0.9

1.3 98.7

73.4 24.3

1.0

1.1 98.9

72.7 25.2

1.0

1.4 98.6

76.1 21.7

0.8

1.5 98.5

78.2 19.5

0.8 % from volume of const. works made by ent. with 20 or more employees

Work abroad inland of inland work: - new * - repairs/maint. - other

2.3 97.7

84.7 12.2

0.9

1.4 98.6

84.1 13.5 1.0

1.2 98.8

83.5 14.3 1.0

1.5 98.5

84.4 12.9

1.2

1.6 98.4

85.4 11.7

1.3 (a) including reconstructions and renovation * data from whole volume of made construction works = estimation The rate of works abroad is around 1%, works inland are long-term more important. Of the inland work, new construction work, incl. reconstruction and modernization, was dominant; its percentage was above 80 %. As shown in the table above, the enterprises with 20 and more employees were focused mostly on new constructions (the percentage of this size of companies was by +7.2 p.p. higher than those of all the construction companies) and also on works abroad (the percentage higher by +0.1 p.p.). They were focusing less on maintenance and repairs (the percentage lower by +7.8 p.p. than those of all the construction enterprises).


47

Construction output of small and great enterprises

bill.CZK current pr.

rate in % Index current pr.*

2000 Enterprises with 19 or less employees Enterprises with 20 or more employees

66.724 192.946

25.7 74.3

115.2 107.4


78.006 217.700

26.4 73.6

116.9 112.8


84.899 226.273

27.3 72.7

108.8 103.9


100.525 246.227

29.0 71.0

118.4 108.8


116.098 278.207

29.4 70.6

115.5 113.0


132.065 290.672

31.2 68.8

105.4 108.1

* Index current pr..= estimation The share of small enterprises has grown last years. In 2000, enterprises with up to 20 employees carried out over 75 per cent of construction output; in 2005, this volume decreased to “only” 69 %.

Structure of output by size of enterprise (enterprises with 20 and more employees)

2000 2001 2002 2003 2004 2005 Number of emp percentage 20 - 24 25 - 49 50 - 99 100 - 499 500 - 999 1000 +

3.8 14.8

16.8 35.5 7.8 21.3

3.9 15.4

17.9 31.2 7.2 24.4

4.3 16.3 17.3 30.7

8.2 23.2

4.1 15.7 17.6 28.5

8.4 25.6

5.2 15.7 16.9 27.6

8.9 25.8

4.9 14.5 15.3 26.2 10.5 28.6

The development of structure of construction output by size of enterprise reflected the changes in national economy. The amount of middle-sized and great enterprises decreased but the greatest enterprises kept its main rate on whole output. Structure of output of enterprises with 20 and more employees by sectors

Non-financial pub-lic ent.

Non-financial private ent.

Non-fin private foreign-cont.

Households sector

percentage 2000 2001 2002

2003 2004 2005

1.7 1.8 2.4 1.4 1.3 1.2

90.1 78.1 80.0 77.8 79.5 79.2

4.5 17.4 15.0 18.3 16.9 17.8

3.6 2.7 2.9 2.5 2.2 1.7

bill. CZK current prices 2005 3.584 230.276 51.777 5.035


48

Major part of the output of enterprises with 20 or more employees was realized by private en-terprises (without foreign-controlled ent.) even if between 2000 and 2004 their rate fell down by more than 10 percentage points. The rate of foreign-controlled enterprises was still in-creasing.

Structure of construction output of building enterprises with 20 or more employees by legal status in %

Private enterprises Enterprises total unregistr. reg. unlim. p. ltd. joint-st. co-op. other

2001 2002 2003 2004 2005

99.3 99.6 99.8 99.6 99.9

3.1 2.8 2.6 2.1 1.6

0.8 1.0 1.0 1.2 1.1

1.2 1.3 0.8 0.6 0.4

42.7 42.1 40.3 40.6 38.7

51.5 52.1 54.7 54.7 57.8

0.3 0.2 0.2 0.2 0.2

0.1 0.2 0.0 0.2 0.1

Explanations: unregistr. –individual contractors enterprises, unregistered in the Commercial Register reg.. - individual contractors enterprises, registered in the Commercial Register unlim. p.= unlimited partnerships ltd. = limited liability companies Almost whole construction output was done by private enterprises with 20 or more employ-ees. Mostly joint-stock companies with rate, which reached almost 58% in year 2005 and which increased for last 3 year at the expense of other categories. Limited liability companies rate on construction output was under 40 %. Other enterprises were not important from this point of view, their rates reached about 3.5% in whole.

The rate of construction works buildings / civil engineering

2 0 0 3 2 0 0 4 2 0 0 5 inland

=100

new=100 repairs

= 100 inland

=100

new=100 repairs

= 100 inland

=100

new=100 repairs

= 100 Buildings Civil engineering

58.1 40.9

60.2 39.8

50.2 49.8

59.3 39.5

61.1 38.9

53.0 47.0

57.3 41.4

58.4 41.6

55.6 44.4

Notes: new – new buildings including reconstructions and renovations The difference in rates on works inland is created by other works. Most part of construction works is done by enterprises with 20 or more employees. Buildings are 57% of works. This rate decreased from 64% to 58% from year 2001 to year 2003. In the year 2004 increased by 1% but in year 2005 again decreased to 57.3 %. Civil en-gineering works creates remaining 41% of output. Most part of work were new constructions (including reconstruction and renovations) same as in buildings and civil engineering works.

Structure of construction output by type of work

2000 2001 2002 2003 2004 Total production % from whole volume of new buildings (inc. R a R)

Residential buildings Non-resid. non-indust. buildings

15.4 19.4

15.0 16.4

15.5 17.0

17.3 16.2

18.6 18.5

CONSTRUCTION WORKS

0

50

100

150

200

250

300

350

400

450

2000 2001 2002 2003 2004 2005

CZ

K b

ill.,

curr

ent p

rice

s

Total

Enterprises with20+ employees

Enterprises withup to 19employees


49

2000 2001 2002 2003 2004 Non-resid. industrial buildings Civil engineering Water buildings

27.5 35.6

2.1

33.7 33.7 1.2

30.4 35.8

1.3

29.5 35.4

1.6

22.5 38.9

1.5 Ent. with 20 or more empl. % from whole volume of new buildings (inc. R a R)

Residential buildings Non-resid. non-indust buildings Non-resid. industrial buildings Civil engineering Water buildings

13.8 19.7 28.1 36.5

1.9

13.2 16.1 36 34 2

13.7 16.8 31.7 36.8

1.0

15.9 15.8 30.6 36.4

1.3

17.4 18.6 22.2 40.6

1.2

In structure of new constructions by type: - prevailed since half of 90´ civil engineering works and non-residential industrial buildings,

their rate was about 30%, dominance of civil engineering over 6 % in year 2003 and 16 % in year 2004.

- decreasing trend have construction of non-residential non-industrial buildings, its rate de-creased from quarter rate in half of 90´ down to one sixth rate.

- important changes were in dwelling construction; after decrease down to 7% in year 1995 reached the rate 15% in 2000 and in year 2004 overcame 18%; beyond this increase the rate of dwelling construction was still below the level in European countries.

II - 3.2 POTENTIAL FACTORS OF DYNAMIC

II - 3.21 Building permits

Number of released building permits

2000 2001 2002 2003 2004 2005

Number year to year variation (%)

169.6 +1.2

149.2 -12.0

140.8 -5.6

149.3 +6.0

153.6 +2.9

142.9 -7.0

The number of building permits granted from 1994 to 1997 grew up to almost 181,000. A slowdown followed since 1998 and the number of permits reached approx. 141,000 in 2002. In the year 2003 there was year-to-year increase up to 149 thousands (+ 6 %), which was al-most same as in year 2001. In the year 1004 the increase slowed down (+ 2.9 %) and number of building permits was about 154 thousands, in year 2005 the number decreased again and not exceed 143 thousands.

Released building permits by regions Kraj: Pha StČ JČ PL KV ÚL LB KH PA Vys JM OL ZL MSl

percentage (total number of building permits = 100) 2002 2003 2004 2005

9.2 9.2 8.5 8.2

17.3 17.8 18.0 18.4

7.0 7.1 7.0 6.5

7.0 6.9 6.8 6.7

2.6 2.6 2.7 2.9

5.3 5.2 5.3 5.5

3.6 3.8 4.1 3.9

5.2 5.4 5.6 5.2

4.1 4.4 4.2 4.1

6.1 5.3 5.3 4.9

11.8 12.3 13.2 13.8

6.2 6.5 5.5 5.9

4.6 4.4 4.6 4.7

8.9 8.3 8.3 8.2


50

The highest number of permits was released in Central Bohemia (StČ, Středočeský kraj) and in South Moravia (JM, Jihomoravský kraj), the less permits were issued in Karlovarský Re-gion (KV). As seen is rates in different regions in each years, the structure of released building permits is stabilized.

Number of released building permits by type of construction

Residential buildings Non-residential buildings Environ. Other

2005 total new adapt. total new adapt. N

y/y %

47,974 -6.8 33.6

16,614 -1.2 11.6

31,360 -9.5 22.0

25,668 -12.8 18.0

10,100 - 16.8

7.1

15,568 -7.7

10.9

33,691 -6.6 23.6

35,608 -2.95

24.9 Notes: new - new works + reconstruction + modernisation adapt. - adaptation of completed buildings Environ - Preservation of the environment N – number; y/y – year to year variation in %; % - percentage of total number of permits The most permits were released for dwelling construction in year 2005, almost 48 thousands, it is decrease against last year by 6.8%. This trend continues already for a few years. Also the trend of decrease in adaptation of completed building (residential), more than 31 thousands (year to year decrease by 9.5 %), number of permits for new buildings also de-creased compared to year 2004 (by 1.2% down to 16.6 thousands), slightly overcome one third of all permits for dwelling buildings. On second place in numbers, there were permits for environmental buildings in year 2005 (same as 2004), there were released 33 thousand, which is by 6.6% less than in last year. Number of permits released for non-residential building in year 2005 decreased year to year by 12,8 %, but as same as residential building, it prevails permits for changes of fin-ished buildings. The number of permits for other constructions also decreased almost by 3 %. In region point of view, there were most permits in Středočeský region and in Prague for dwelling buildings 8,540, resp. 7,485 permits. In Středočeský region the number of per-mits for new building and for changes in finished buildings was almost in equilibrium, in Pra-gue mostly prevail permits for changes in finished buildings. In other regions the number of permit vary between 1,233 permits in Karlovarský region up to 6,013 in Jihomoravský region, also here the permits for changes prevail. Estimated value of released building permits

2000 2001 2002 2003 2004 2005 bill. CZK change (%)

229.96 -3.7

236.38 +2.8

242.21 +2.5

286.23 +18.2

315.07 +10.1

325.82 +3.4

The estimated value of permitted projects at current prices has grown up since 1994, except 2000, i.e. thanks to the growth of prices of construction works. The highest relative growth was in years (1994-1996). In next years there were strong decrease in year growth, which meant real stagnation. In year 2003 there was relatively high growth by + 18.2%.


51

There was not so high growth in 2004 but + 10.1% can be considered as growing trend. In year 2005 the growth of estimated value slowed down to 3.4%.

Estimated value of released building permits by regions

Region: Pha StČ JČ PL KV ÚL LB KH PA Vys JM OL ZL MSl percentage- total value of building permits

2002 2003 2004 2005

17.5 15.1 16.3 11.9

12.5 12.0 12.9 13.6

4.8 4.2 4.7 4.2

5.4 5.0 5.0 5.7

2.2 2.2 2.6 1.9

6.6 4.7 4.6 6.1

3.2 2.2 2.4 2.3

4.3 3.6 4.2 3.8

3.5 2.9 3.9 4.1

4.9 4.2 3.7 3.6

9.5 9.3 9.0 10.3

4.2 4.2 4.2 4.6

4.2 3.4 4.0 3.8

7.5 7.9 7.7 7.3

The highest rates of estimated value volume of released building permits had Středo-český region, 13.6% and Prague, 11.9% (from higher rate of estimated value mainly in Pra-gue we can decide on bigger size and higher facilities of permitted buildings). From other re-gions, Jihomoravský and Moravskoslezský region participate on estimated value of permitted buildings. their rates reached 10.3% resp. 7.3 %. Similar to region structure in number of re-leased permits also structure of estimated value of permits is stabilized. .

Estimated value of released building permits by type of construction

Residential buildings Non-residential buildings Environ. Other 2005 total new adapt. total new adapt.

CZK bill. y/y %

97.3 +2.8 29.9

73.7 +6.2 22.6

23.5 -6.8 7.2

108.6 +9.2 33.3

61.7 +9.6 18.9

46.9 +8.8 15.4

28.4 +13.7

8.7

91.5 -4.7 28.1

Non-residential buildings participate on volume of estimated value by one third and by 30% residential buildings. In comparison with year 2004 the value increased in 2005 by + 9.2% for non-residential building and +6.2% for residential buildings. New residential build-ing created more than 70% and year to year growth was + 6.2 %. Non-residential new build-ings created 60% and in comparison to last year there was an increase by + 9.6%. Estimated value of permitted buildings for preservation of nature overcame 28 bill. CZK. It is about 9 % of whole value and it is increase of +14% to year 2004. Other permitted buildings decreased its rate down to 28.1%, they decreased their value by – 4.7%.

Average value per building permit

2000 2001 2002 2003 2004 2005 bill. CZK change (%)

1.356 -4.8

1.584 +16.8

1.720 +8.6

1.917 +11.4

2.051 +7.0

2.279 +11.1

Average value of one building (value for one building permit) is increasing from year 1994. This is caused by growth of construction works price.


52

Average value per building permit by type of construction

Residential buildings Non-residential buildings Environ. Other 2005 total new adapt. total new adapt.

mill CZK change y/y *

2.027 +10.3

88.9

4.435 +7.5

194.6

0.752+3.333.0

4.232+25.3185.7

6.109+31.7268.0

3.013+20.9132.2

0.844 +21.8

37.0

2.570-1.9

112.7 Notes: new - new work + reconstruction + modernisation adapt. - adaptation of completed buildings Environ - Preservation of the environment y/y - year to year variation in %; % - percentage of the total number of permits * average value of all permits = 100 Trend of growth took effect also in case of average values of each type of construc-tions. Average value of residential buildings reached 2.279 mill. CZK in year 2005 and in comparison to year 2004 increased by + 11.1 %. Average value of dwelling new buildings reached 4.435 mill. CZK. This relatively high value is effected by high rate of changes in fin-ished buildings. Similar situation is for value of non-residential buildings, 4.232 mill. CZK. Strongly lower was average value of buildings for nature preservation, roughly third of total average. In permitted dwelling buildings should originate 38,711 new apartments, of them in new buildings 32,887, in changes of finished buildings 5,824 and in non-residential buildings 2,917 new apartments. In comparison to year 2004 there should originate by + 4.1 % more new apartments, of them by + 7.4% in new buildings and in changes of existing buildings – 11.3 %. In non-residential buildings the number of new apartments increased by + 5.8% in comparison to last year. II - 3.22 Orders for construction work

Stock of orders as at the end of year

2000 2001 2002 2003 2004 2005 CZK bill., current prices

T o t a l 102.644 118.912 136.501 158.451 212.499 205.390 of which abroad inland

2.611 100.033

3.242 115.670

2.420 134.081

2.589 155.862

11.315 201.184

11.350 194.040

per cent (all orders = 100) Orders - abroad - inland

2.5 97.5

2.7 97.3

1.8 98.2

1.6 98.4

5.3 94.7

5.5 94.5

Since year 1993, when the orders are statistically monitored (orders for works com-prised in Divisions 451 or 452 of NACE/CZ, firms with 20 or more employees) till the end of 2004 the size of orders in current prices increased almost three times, from about 71 bill. CZK up to 212.5 bill. CZK. In year 2005 the volume of orders decreased. The rate of foreign orders in year 2004 increased more than three times (same in 2005), the inland orders strongly pre-vailed.

0

50

100

150

200

250

300

350

CZ

K b

ill.,

curr

ent p

rice

s

2002 2003 2004 2005

APPROXIMATE BUILDING PERMITS GRANTED

ORDERS BY INVESTOR'S SECTORS to 31st December 2005

0102030405060708090

100

in the

CRne

w const

ructio

n

reside

ntial

not f

or pro

ducti

on fo

r prod

uctio

nciv

il eng

ineeri

ng

water m

anag

emen

t

CZ

K b

ill.,

curr

ent p

rice

s

publicprivate


53

Inland orders as at the end of year – by type of works

2000 2001 2002 2003 2004 2005

CZK bill., current prices New work + R + M Repairs + maintenance Other work

95.387 4.485 0.161

110.823 4.749 0.098

127.777 6.182 0.122

147.686 7.379 0.797

193.299 7.099 0.786

185.750 7.596 0.693

Per cent; total orders = 100 New work + R + M Repairs + maintenance Other work

92.9 4.4 0.2

93.2 4.0 0.1

93.6 4.5 0.1

93.2 4.7 0.5

91.0 3.3 0.4

90.4 3.7 0.3

* including reconstruction and modernization Orders for new works, incl. reconstruction or modernisation prevail.

Year to year variation of the orders stock as at Dec. 31st, 2005 – by type of works

- - Inland orders New work + Reconstruction + Modernisation all abroad all R + M Other New Resid. NR/NI NR/I Civil. e. Water b.

Per cent - 3.3 +0.3 -3.6 +7.0 -11.8 -3.9 +16.3 +13.9 +27.5 -15.3 -10.8

Notes: R + M = repairs and maintenance Resid. = residential buildings NR/NI = non-residential non-industrial buildings NR/I = non-residential industrial buildings Civil. e. = civil engineering work Water b.= water buildings To Dec. 31.st, 2005 the whole volume of orders decreased by – 3.3% on comparison to year 2004. and similarly the volume of inland orders and orders for new buildings decreased by the same rate. In comparison to last year there was no growth in any type of works. The highest decrease was in civil engineering works by – 15%, water building by -10.8%. The growth in volume of orders in non-residential and non-industrial building increased above-average.

Orders for new works* as at the end of year ...

2000 2001 2002 2003 2004 2005 bill. CZK, current prices

Buildings - residential - non-resid, non-ind - non-resid, industr. Civil eng. works Water build.

13.636 28.062 11.003 40.517

2.169

13.23426.849

8.95659.807

1.977

18.50629.115

7.52570.352

2.279

20.45540.998

8.70174.109

3.422

22.053 33.384 12.079

122.508 3.275

25.63738.01115.397

103.7852.920

per cent (orders for new work + reconstruction + modernisation = 100) Buildings - residential - non-resid, non-ind - non-resid, industr. Civil eng. works Water build.

14.3 29.4 11.5 42.5

2.3

11.9 24.2

8.1 54.0

1.8

14.5 22.8

5.9 55.1

1.8

13.8 27.8

5.9 50.2

2.3

11.4 17.3

6.2 63.4

1.7

13.8 20.5

8.3 55.9

1.6 * including reconstruction and modernization


54

In structure of orders the rate of orders of civil engineering works decreased by – 7.5%. The rate of orders for water buildings also decreased by – 0.1 %. The rates for orders of other types increased year to year by + 2%. In the end of 2005 the average size of order decreased from 13.707 mill. CZK down to 12.536 mill.CZK, it’s by – 8.5% in comparison to year 2004. In next 6 months, it is in 1. half of year 2006, there should be realized 41.7 % (from number of 79.5%), which is almost same as last year. In next half year (2. half of 2006) should be realized next 30.4 % of volume ( 13.9% ) it’s little more than last year.

Percentage of public orders by volume in %

as at Dec 31

Inland orders

New+reconstr.+modern..

Residential buildings

Non-resid. non-ind. b.

Non-resid. industr. b.

Civil engineering

Water build-ings

2000 2001 2002 2003

2004 2005

64.6 69.9 72.5 71.2 77.1 69.1

64.8 70.2 72.3 71.1 77.1 68.5

48.9 42.9 47.4 35.1 37.9 20.6

59.8 61.9 58.8 58.2 61.4 56.9

20.9 27.8 37.3 41.6 21.4 13.9

84.5 85.8 88.0 90.8 93.6 92.1

81.1 86.1 76.0 90.4 90.3 89.2

The public sector kept its strong position as the submitter in year 2005, the same as in new works as in maintenance and repairs and in other works; in new works civil engineering and water buildings prevailed. In comparison to last year the volume of public orders de-creased in all sectors. Public and private orders differed also by their size : average size of public order was more than two times higher (19,9 against 6,6 mill. CZK)

II - 3.3 PRICES OF CONSTRUCTION WORKS

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Construction work price indices; previous year = 100

114.0 110.9 111.3 111.3 109.3 104.5 104.0 104.0 102.7 102.2 103.7 103.0 Reflecting the overall growth, a steep growth of construction work prices appeared in the beginning of 90´, and continued, but the year rates of growth decreased gradually. The decreasing continued slowly except years 1994 and 1999. The year 2004 started increasing the growth trends by + 1.5%, but in year 2005 the trend decreased again by – 0.7%.

same period of last year = 100 2003 2004 2005 2005 - 2004 Construction work (NACE, Division 45) 102.2 103.7 103.0 -0.7 Construction work (NACE, Division 46) - residential buildings - non-residential non-industrial buildings - non-residential industrial buildings - civil engineering - water buildings

102.2 102.2 102.1 102.1 102.2 102.7

103.7 103.7 103.4 104.1 103.6 102.7

102.9 102.8 102.8 103.1 103.1 102.6

-0.8 -0.9 -0.6 -1.0 -0.5 -0.1


55

The rate of growth increased in year 2004 in all types of construction, on contrary in year 2005 the growth decreased in all types: the strongest year to year decrease of growth was by prices of non-residential industrial buildings by – 1.0 %, on contrary the smallest decrease was in prices of water buildings by – 0.1 %. The year growth rate was in each type of construction about + 2.6% to + 3.1%. During the year the growth rate had decreasing tendencies in all types of construction. The highest values were in 1.quarter – indices exceeded 104.0 ( range from 104.0 – 104.4), contrary in 4.quarter were the values the lowest (range 102.3 – 103.2).


56

II - 4 EMPLOYMENT AND WAGES

II - 4.1 EMPLOYMENT

II - 4.11 Employment in the construction sector

Employees in the construction industry

Number (1,000) Previous year = 100 1990 = 100 % (of civil sector) 1990 402.5 - 100.0 7.5 1995 455.4 - 113.1 9.2 1999 2000 2001 2002 2003 2004 2005

443.2 439.0 428.4 435.6 438.6 451.1 457.5

- 99.1 97.6

101.7 100.7 102.8 101.4

110.1 109.1 106.4 108.2 109.0 112.1 113.7

9.3 9.3 9.0 9.1 9.3 9.5 9.5

The average number of person working in construction industry was increasing from about 200 thousands in year 1950 and in 70´ exceeded 400 thousands persons. In 2half of 90´ started slow decrease, in last years it has increasing tendencies again and in year 2004 ex-ceeded 450 thousands workers in construction and in year 2005 almost 460 thousands. Changes were influenced by progression, restructuring of enterprises and by the growth of productivity of labour.

Employment by sectors - 2005 (persons with the only or main employment as in the 4th quarter)

1,000 persons % 2000 = 100

Construction 457.5 9.5 105.1 Agriculture, hunting, forestry, fishing Mining and quarrying Manufacturing industry Prod./supply of electricity, gas and water

144.5 52.2

1 319.1 73.5

3.0 1.1

27.5 1.5

62.5 95.3

100.1 95.0

Trade, repairs of mot. vehicles/h. goods Hotels and restaurants Transport, warehousing, posts, telecommunication.

612.1 181.1 356.8

12.7 3.8 7.4

97.4 103.7

98.0 Financial intermediation Real estates, business services, R&D

98.2 304.1

2.0 6.3

104.8 107.0

Public administration., defence, social care Education Health/veterinary care, social activities Other public, social or personal services

339.7 306.4 322.7 189.6

7.1 6.4 6.7 3.9

105.4 99.8

106.5 98.9

Construction 4 803.7 100.0 101.7


57

In 2005 the percentage of employees in the construction industry reached 9.5 per cent of all employees with the only or main employment and number of persons reached 457.5 thousands. In year 2005 the number of persons employed in construction industry increased by 6.4 thousands persons. From the point of view of number of workers in construction indus-try, Czech Republic is on comparable level with Italy, Portugal, Germany, Austria or Switzer-land.

Workers, (W) – Employees (E) - enterpriser (En) in chosen sectors

W E En thou-

sands thou-sands

% * thou-sands

without E

% **

Total in main employment in 4. quarter 4,803.7 4,026.4 83.8 724.6 547.8 75.6 Construction 457.5 292.7 64.0 160.6 134.3 83.6 Agriculture, hunting, forestry, fishing Mining and quarrying Manufacturing industry Trade, repairs of mot. vehicles/h. goods Transport, wareh., posts, telecomm. Real estates, business services, R&D

144.5 52.2 1,319.1 612.1 356.8 304.1

102.3 50.7 1,221.3 461.9 310.9 198.2

71.0 97.1 92.6 75.5 87.1 65.2

23.3 1.5

90.7 141.4

43.5 102.1

19.7 1.2

61.6 43.3 33.2 84.4

84.5 80.0 67.9 30.6 76.3 82.7

Explanations: * of number of workers; ** enterprisers without employees of all enterpriser The difference between the sum of employees and enterprisers and number of workers are other categories of workers e.g. members of co—operatives, number of helping family members and so on. Most part of people in all sectors were at direct employees position. As a sum for all sectors in 4.quarter 2005 the rate of employees created 84% on whole employment. In con-struction industry was the rate usually the lowest from all sectors, 62.4 % (292.7 thous. per-sons). Construction industry has its specific features. Strong prevail of whole number 160.6 thousands enterprisers had enterprisers without employees, 134.3 thous. (it’s 83.6% - almost the highest rate of all sectors); on whole number of enterprisers without employees it created almost one quarter. According to FIEC estimation ( Fédération de l’Industrie Européenne de la Construction) in the beginning of period in EU countries the rates of employees of whole number of workers in construction industry are usually above the level of Czech Republic. Belgium Denmark Finland France

79 % 87 %

80 % 85 %

Italy Germany Portugal Austria

62 % 79 %

75 % 93 %

Unit. Kingdom Spain Sweden EU 15

60 % 79 %

85 % 70 %

In structure of workers in Czech construction industry by gender there was above-average rate of men: in 4.quarter 2005 the rate of men on level of whole economy was 56.7% (decrease 11 % compare to year 2004), in construction it was 91.7 %. It included be-sides other high exacting of construction professions and works, as influenced by the weight of building materials and structures and as by character of working place and climate (work in open area). High rate of men in construction industry has long-term character.

Percentage of employees by age in %


58

15 - 24 years 25 - 29 years 30 - 44 years 45 – 59 years 60 and more 7.2 13.2 39.2 36.9 3.5

The structure of employment in the construction industry by age was almost the same as in the manufacturing industry. II - 4.12 Employees in construction enterprises with 20 or more employees

In 2005, the average number of direct employees in construction firms with 20 or more employees increased by +7,500 persons, i.e. by +4.9%, compared to 2004. The number of employees differs in relation to the seasons: the number of people directly involved in construction industry started on 150,721 at the beginning of 2005, increased by August up to 167,916 and in next 3 months vary about 166 thousands persons. In December the average number of employees decreased to 162.5 thousands persons. Direct employees in enterprises with 20 or more employees by legal status

Average no. of direct employees Index 2004 2005 2004 = 100

T o t a l 152,674 159,867 104.7 of which ent. of individuals, not in the Comm. Reg. entered in the Comm Reg. unlimited partnerships limited liability companies joint-stock companies

5,306 2,380 877

83,494 59,922

5,948 2,363 938

89,468 60,338

112.1 99.3

106.9 107.2 100.7

co-operatives other businesses

707 719

923 840

130.6 116.9

The number of direct employees increased in all the sectors, except private individuals registered in the Commercial Register.

Structure of employment by legal status of enterprise

P r i v a t e f i r m s Organisations not reg. registered unlim. p. ltd. joint-stock total co-op. other

p e r c e n t 2000 2001 2002 2003 2004 2005

5.2 5.3 4.8 4.7 4.3 3.7

1.5 1.5 1.5 1.6 1.6 1.5

1.1 1.1 1.1 1.0

0.8 0.6

50.9 51.6 52.8 52.7 53.8 55.3

40.1 39.0 38.6 38.6 38.1 37.3

99.1 99.0 99.1 99.0 99.0 98.9

0.7 0.7 0.6 0.6 0.5 0.6

0.2 0.3 0.3 0.4 0.5 0.5

Notes: not reg. - firms of individuals, not entered in the Commercial Register registered - firms of individuals, entered in the Commercial Register unlim. p - unlimited partnerships ltd. - limited liability companies joint st. - joint-stock companies co-op. - co-operatives From table results, that:


59

- more than half of employees work in limited liability companies and their rate increased - almost 40% employees work in joint-stock companies, their rate slightly decreased - enterprises not registered in the Commercial Register participate on employment roughly by 4 % and its rate has decreasing tendency - the rates of private enterprises registered in the Commercial Register and unlimited partner-ship were on same level about 1.5% resp. 0.6% - the rates of enterprises of other legal status, it is co-operatives and other organizations, had small rates about 0.5 %. As a whole we can say, that structure of employment by legal status was in compari-son to last periods almost constant. The rate of limited liability companies is slightly increas-ing at the expense of joint-stock companies.

Direct employees by size of enterprises

Employees Workers Average number Index structure Average number Index Rate 2004 2005 ‘04=100 2005 2004 2005 ‘04=100 Z=100

T o t a l 154,100 161,630 104,9 100,0 100,883 105,769 104.8 65.4 of which ent. with 20 - 49 50 - 299 300 - 499 500 - 999

1,000 or more emp.

46,096 67,006 10,179 11,378 19,439

50,36869,85810,30611,73119,630

109,3104,3101,2103,1

99,6

31,243,2

6,47,3

12,0

32,73945,398

6,1596,6049,983

35,729 47,156

6,240 6,798 9,847

109.1 103.9 101.3 102.9 98.6

70.9 67.5 60.5 57.9 50.8

Notes and explanations: Division to categories corresponds roughly to determination of small, middle-sized and large enterprises by number of employees Rate = rate of workers of employees in the year 2005 In small enterprises (with 20-49 employees) there were in year 2005 employed more than 30 % of all employees, in middle-sized enterprises (with 50-299 empl.) more than 43% and in large enterprises about quarter of all employees. In comparison to last year, the num-bers of employees and workers in large enterprises decreased in year 2005 on behalf of small and middle-sized enterprises: - number of employees and its rate on whole employment in small enterprises increased by 4.2 thousands, it is more than 9%; number of workers increased by +2,200 persons, it is about +9%; - number of employees and its rate in middle-sized enterprises increased almost about + 3 thousands persons, it is about + 4%; number of workers increased about 1,800 persons, it is almost about +4%, - number of employees in large enterprises decreased by -191 employees, it is – 0.4 %; num-ber of workers decreased by - 136 persons, it is by – 1.4 %. The highest rate of number of employees had workers in small enterprises, more than 70 %. In middle-sized enterprises there were their rate lower than 70% and in large enter-prises about 50-60%, this status roughly corresponds to last year.

Employment by institutional sectors

Non-financial ent. Non-financial ent. Enterprises for- Households sector


60

public private eign-controlled 2004 Employees Workers

3,432 1,755

127,997 84,519

16,902 9,981

5,768 4,628

2005 Employees Index - ‘03 = 100 Workers Index - ‘03 = 100 Rate of empl.

3,376

98.4 1,705

97.1 50.5

134,171 104.8 88,312

104.5 65.8

17,586 104.0

10,619 106.4 60.4

6,496 112.6

5,132 110.9

79.0 In the year 2005 number of employees increased in all institutional sectors, mostly in households sector, by + 12.6 %. One exception was the sector of non-financial public enter-prises where the number of employees decreased by – 2.9 % in comparison to year 2004. Similar progression is in number of workers. The highest growth was in households sector, by + 10.9 %. In private non-financial enterprises and enterprises foreign-controlled the change was about + 6%. in non-financial public enterprises the number of workers decreased by – 2.9%.

II - 4.2 WAGES

II - 4.21 Wages in construction industry

Average monthly wages of employees by sectors in year 2005

Wages y/y variation Pattern CZK % %

Construction 18,963 +4.9 99.6 Agriculture, hunting, forestry Fishing Mining and quarrying Manufacturing industry Prod./supply of electricity, gas and water

13,878 15,986 22,484 17,825 24,186

+5.6 +4.0 +6.3 +4.6 +6.9

72.9 84.0

118.2 93.7

127.1 Trade, repairs of mot. vehicles/h. goods Hotels and restaurants Transport, warehousing, posts, telecommunications

19,040 13,393 20,579

+3.8 +3.0 +6.0

100.1 70.4

108.1 Financial intermediation Real estates, business services, R&D

37,406 21,147

+5.6 +8.0

196.6 111.1

Public administration, defence, social care Education Health/veterinary care, social activities Other public, social or personal services

22,307 17,184 17,529 15,622

+8.9 +4.7 +4.6 +6.0

117.2 90.3 92.1 82.1

TOTAL 19,030 +5.5 100.0

In year 2005, the average monthly wages in construction: - reached the height 18,963 CZK, - in comparison to year 2004 increased by +892 CZK, it is by +4.9 %, - of 14 sectors, the construction is in the 7th place, in year to year growth in 8th place and by

year to year absolute increase in 6th place.


61

II - 4.22 Wages in construction enterprises with 20 or more employees

In construction enterprises with 20 or more employees, the average nominal monthly wage increased in year 2003 by 6.1 %, in year 2004 by + 6.2 %. In year 2005, there was also increase but lower, by + 3.8 %. Nominal monthly wage of manually working employees also increased but a less.

Average nominal monthly wages by institutional sectors

CZK diff. 2005 - 2004 2004 = 100 Wages of employees - total - public enterprises - private enterprises - private ent. in foreign control - household sector

18,233 17,496 17,652 24,717 12,576

690 1,025

652 1,132

578

103.8 105.9 103.7 104.6 104.6

Wages of workmen - total - public enterprises - private ent. - private ent. in foreign control - household sector

14,923 16,066 14,749 17,362 12,397

377 610 378 312 504

102.5 103.8 102.6 101.8 104.0

- In the year 2005, the wages reached the highest absolute height and absolute increase in en-

terprises with foreign control: absolute increase + 1,132 CZK, average month wage 24,717 CZK. Average monthly wage in these enterprises highly got over total average, by + 36.6 %.

- The highest relative increase of wages and 2nd place, in absolute increase, was in non-

financial public enterprises (the size of growth + 5.9%, increase + 1,025 CZK, average wage in these enterprises was by 2.1 % down by total average).

- The lowest monthly wage and the lowest year to year absolute increase were in household

sector (size of growth + 4.6 %, absolute increase 578 CZK, average monthly wage 12,576 CZK, by – 30.5 % below total average.

Similar development was in wages of workers. In comparison to employee’s wages the growth was slower. But also these wages were above-average in enterprises foreign-controlled and in non-financial public enterprises. In total, the level of workers wages was in 80.9 % of employee’s wages: the highest rate had wages of workers in enterprises foreign-controlled, 93%, the lowest rate was in household sector, almost 70 % (it relates to size and employees structure). High rate was in non-financial public enterprises, 88.1 %, in non-financial private enterprises was 79.9 %.


62

Average nominal monthly wages by status of enterprises

Wages - CZK Index Increm. CZK Relation 2004 2005 2004 = 100 ‘05 - ‘04 2005

T o t a l 18,233 18,923 103.8 690 100.0 Private firms - total - individuals not entered in C. R. - individuals entered in Com. Reg. - unlimited partnerships - limited liability companies - joint-stock companies

18,271 12,603 14,721 16,681 16,493 21,458

18,977 13,137 15,282 17,129 16,799 22,996

103.9 104.2 103.8 102.7 101.9 107.2

706 534 561 448 306

1,538

100.3 69.4 80.8 90.5 88.8

121.5 Co-operatives Other organisations

14,247 14,047

13,373 14,720

93.9 104.8

-874 673

70.7 77.8

Note: Relation to the overall average According to legal status of enterprises, the average monthly wage increased the high-est in joint-stock companies, by + 7.2 %, resp. by + 2,538 CZK. Its height reached 23,000 CZK and it was by + 21% above total average. In enterprises of other legal status the monthly wage did not reach the average value: in unlimited partnership the wage was lower by – 9.5%, in limited liability companies by – 11.2 %, in other enterprises by – 20-30%.

Average nominal monthly wages by size of enterprises

Firms with the number of employees up to

24 49 74 99 199 299 399 499 999 more E m p l o y e e s

2004 2005

14,544 14,845

15,410 15,664

16,130 16,600

17,145 17,517

17,070 17,580

18,085 18,561

19,210 20,041

19,907 20,236

22,458 23,892

26,697 29,692

‘04=100 diff

102.1 301

101.7 254

102.9 470

102.2 372

103.0 510

102.6 476

104.3 831

101.7 329

106.4 1,434

111.2 2,995

Σ‘05=1 0.78 0.83 0.88 0.93 0.93 0.98 1.06 1.07 1.26 1.57

Firms with the number of employees up to 24 49 74 99 199 299 399 499 999 more

W o r k m e n 2004 2005

13,398 13,650

13,860 14,022

14,295 14,735

14,701 14,994

14,650 14,976

14,627 15,243

16,158 16,688

16,664 16,411

17,134 18,108

18,176 19,259

‘04=100 diff

101.9 252

101.2 162

103.1 440

102.0 293

102.2 326

104.2 616

103.3 530

98.5 -253

105.7 974

106.0 1,083

Σ‘05=1 0.89 0.92 0.96 0.98 0.98 1.00 1.09 1.07 1.18 1.26 Explanation: 2005, 2004 - wage in CZK ‘04=100 - last year = 100 diff - difference between wage in 2005 compare to 2004 in CZK Σ‘05=1 - total average in year2005 = 1 About monthly wages by size of enterprise we can say: • The height of average monthly wage of employees is strongly dependent on size of enter-

prise (according to number of employees):


63

- the wages of employees in small enterprises ( with 20 to 49 employees) reached in 2005 only up to 80 % of total average, in middle-sized enterprises ( with 50 to 299 employees) 88 to 98 % and in large enterprises up to 157 % of total average, - the wages of workers in small ent. reached about 90 % of total average, in middle-sized ent. 96-100 % and in large ent. up to 126 %.

• We can also see the dependence between the increase of wages of employees and size of enterprise. The increase varied from about + 254 CZK in small ent, in middle-sized ent. over +400 to +800 CZK and up to + 2,995 CZK in largest enterprises. Similarly, it was in case of workers wages, in small ent. the increase was about + 200 CZK, in middle-sized ent. up to +600 CZK and in largest ent.. up to +1,000 CZK.

• The rate of monthly wages of workers and employees decreased with size of enterprise, from about 92 % in small ent. down to 68 % in the largest ent.

II - 4.3 PRODUCTIVITY OF LABOUR

Productivity of labour (PoL) - 2005

CZK at constant prices CZK at current prices PoL (of value of contracts - va-lue “S“)y/y variation in %

1,540,080 +0.2

1,798,379 +3.0

PoL (of own empl. output - va-lue“ZSV“)y/y variation in %

- -

1,351,721 +9.0

Significant change in the labour trend productivity took place in 2000. Following the fall by -0.8 % in 1999, the productivity of labour grew up by -0.8 % in 2000 and so did the growth rate in next years: in the year 2005 it reached 1,540,080 CZK and compared to year 2004 it increased by + 0.2 % (at constant prices), resp. 1,798,379 CZK, it’s + 3.0 % (in cur-rent prices). It means that it did not overtake the monthly wages growth (which reached + 3.8%).

Productivity of labour by institutional sectors

Public firms Private firms - in foreign control Households Productivity of labour in thousands CZK in prices of year 2000

2004 890 1,484 2,346 731 2005 index

910 102.3

1,471 99.1

2,510 107.3

666 91.2

P - M -3.6 -4.6 +2.7 -13.4 Explanations: index - year 2003 = 100 P - M - difference of size of growth of productivity of labour and monthly wages The highest productivity of labour reached enterprises foreign-controlled: in year 2005 overtook 2.5 mill. CZK (at constant prices). The size of productivity growth was the highest in enterprises foreign-controlled and overtook + 7 %. Roughly about 1 mill. lower was the productivity in private enterprises (1.5 mill. CZK). The lowest productivity was reached in household sector, about 666 thousands CZK by decrease of 9 %.


64

The leading of productivity growth before wages growth was reached only in enter-prises foreign-controlled, where the difference reached almost 3 % on behalf of productivity growth. In other enterprises and households the productivity growth fell behind to wages growth by 3.6 to 13.4 %. In comparison to last year there were strong changes. When the highest increase in the productivity was in private enterprises but the households fell behind this year.

Productivity of labour by size of enterprises

Firms with number of employees up to 24 49 74 99 199 299 399 499 999 more

Productivity of labour in thousands CZK in prices of year 2000 2004 948 1,075 1,115 1,296 1,220 1,814 1,654 1,465 2,041 3,207 2005 index

905 95,4

984 91,5

1,058 94,8

1,188 91,7

1,104 90,5

1,827 100,7

1,746 105,5

1,659 113,3

2,212 108,4

3,665 114,3

P - M - 6,7 - 10,2 - 8,1 - 10,5 - 12,5 - 1,9 1,2 11,6 2,0 3,1 Explanations: index - year 2003 = 100 P - M - difference of size of growth of productivity of labour and monthly wages The height of productivity was directly proportional to size of enterprise, it means “the larger enterprise the higher productivity” (except to enterprises with 200 to 399 employees). in small ent. was around 1 mill. CZK, in middle-sized ent. from 1.0 to 1.8 mill. CZK and in large ent. from 2 to 3.6 mill. CZK. The productivity increased year to year in categories over 200 employees. There is also the dependence between size of growth of productivity and size of enterprise: in middle-sized ent. the size of growth was only a few tenth percent but in en-terprises with 1,000 and more ent. it reached + 14 %.

The productivity growth was higher than wages growth only in enterprises in category with 300 and more employees. The significant increase was in category of 400 – 499 employ-ees ( 11.6%). In smaller enterprises the size of productivity growth did not overtake the wages growth.

20 to 24

25 to 49

50 to 99

100 to 199

200 to 299

300 to 399

400 to 499

500 to 999

1000 and more1.-4.Q 2004

1.-4.Q 2005

0

800

1 600

2 400

3 200

4 000

4 800

CZ

K th

ousa

nds

Size of enterprise (number of employees)

Productivity of employees (from "S" value)in years 2005 and 2004


65

II - 5 BUSINESS RESULTS

II - 5.1 BUSINESS RESULTS (CONSTRUCTION ENTERPRISES WITH 100 OR MORE EMPLOYEES)

Construction enterprises with 100 and more employees produced in year 2005 con-struction works by supply contracts (value “S” ) in 189.3 bill. CZK and by own employees (value “ZSV”) in 122.0 bill. CZK which is more than half of total construction output. It can be taken as a representative sample of all construction enterprises.

2004 2005 05/04 Share of profit-makers (in %) Share of loss-makers (in %)

83.1 16.9

85.8 14.2

+3.3 -16.0

Profitability of costs (in %) shareholders’ equity (in %) revenues (in %) assets (in %) Profits per employee (thousands CZK) Costs of wages (in %)

4.5 21.2

4.3 7.6

113.2 8.5

4.6 21.3

4.4 7.9

148.9 8.4

+3.1 +0.6 +2.3 +3.9

+31.5 -1.8

Value added as percentage of revenues Productivity of labour (of value added) Inventories turnover

18.6 538.5

22.1

18.0 562.7

21.0

-3.1 +4.5 -5.0

Explanations: 05/04 = year to year changes in % The economy progression of these enterprises can be considered as a positive in year 2005 because: • The economic result for 1 employee increased • The creation of own sources strongly increased. • The productivity of labour of added value increased by + 4.5 % and crossed half million

CZK • The investments to machinery and equipment increased, the size of supplies increased year

to year by + 5.7%, from that unfinished production by + 5.6 % thereby the need of finan-cial sources increased.

• The growth of revenue overtook the growth of cost by + 0.2 p.p. which influenced year to

year growth of economic results pre-tax (increase by + 15.3 %). Next effect is the increase of the rate of profiting enterprises up to 85.5 % and decreasing the number of loosing en-terprises. The profit of profiting enterprises increased by + 17.2 % in comparison to 2004 but the loss of loosing enterprises increased by + 48 %. The profitability (of own capital, costs, incomes and assets) increased.


66

• The wages growth by 9.9 p.p., other personal costs by 2 p.p. (costs as total increased by + 11.7 p.p.) by reason of that the labour costs decreased in 2005 by – 1.8 p.p.

• Consumption from operation increased more (13.0%) in comparison to added value growth

(+8.6%) which lead to decreasing of the rate of added value on output, by – 0.6 p.p. to 18.0 % and to growth of volume of total costs by + 11.7 %.

• The rate of profit of assets increased by + 3.9 % compared to year 2004 and the rate of

own property on assets increased by + 3.1 p.p. to 35.2 %. Specialisation of enterprises Building Resident NB/NV NB/V Civil en. O + Ú Non sp. Number of ent. of which profit-makers losers

44 42

2

13 11

2

9 9 0

23 22

1

63 58

5

21 17

4

142 115

27 Profitability of shareholders’ equity-% revenues - % Profits per employee - CZK 1,000 Assets as percentage of revenues

22.9 5.0

116.6 9.7

13.1 1.5

37.3 3.6

19.1 5.5

132.9 10.5

26.6 6.5

148.4 12.0

28.0 5.8

223.7 10.4

16.6 4.9

92.1 7.9

16.7 3.3

116.4 6.1

Prod. of labour (of VA) - CZK 1,000 Inventories turnover - days

479.4 23.2

371.6 34.9

443.9 31.3

539.6 15.1

700.0 14.9

429.9 15.5

511.0 24.9

Explanations: Building – building construction Resident – residential civil en. – civil engineering NB/NV – non-residential non-industry b. NB/V – non-resident. industry b. O + Ú – maintenance and repairs Non sp. – non-specified ent. Financial-economic results differed by production specialization of enterprises. • Enterprises oriented mostly to building constructions decreased the income by – 0.7 bill

CZK ( by – 40.5 %). revenues decreased by – 45.7 %. • The main part of growth was in civil engineering enterprises; in enterprises oriented on

dwelling construction decreased profitability in year to year, in enterprises oriented to pub-lic constructions increased profitability and increased the income and decreased their dept.

• In comparison to enterprises with other specialization, construction enterprises reached:

- the profitability slightly above-average - below-average height of economic result on 1 employee - asset returns slightly above-average - below-average productivity of labour of added value, productivity of revenues and pro-ductivity of output - almost the longest stock turnover (except dwelling construction enterprises)

• Enterprises oriented to civil engineering reached:

- slightly above-average profitability, - strongly above-average economic result recalculated on 1 employee, the highest from all

sectors, - above-average assets return and - the highest productivity of labour from added value.


67

• Enterprises oriented mostly to civil engineering constructions created in year 2005 profit by + 2.3 bill. CZK higher year to year. 58 of the enterprises with this orientation created about 48% of total profit of enterprises with 100 and more employees. • In not-specialized enterprises, the revenues increased by + 23%. Overall it came about a setback in profitability sector.

II - 5.2 ENTERPRISES WITH FOREIGN CONTROL Of 271 construction enterprises with 100 and more employees there were 29 enter-prises with foreign control. In year 2005, they employed 16.8 % persons of whole construc-tion enterprises and they participated on revenues from 23.4 %.

Selected financial – economical indices for year 2005

All enterprises Enterprises with foreign control Indicator 2004 = 100 Indicator Rate in % 2004 = 100

Number Number of employees Revenues (mill. CZK)

271 75,555

255,813

104.2 103.9 111.9

29 13,277 59,817

9.2 16.8 24.2

120.8 108.5 108.1

Productivity (of revenues) - CZK 1,000 HV - CZK 1,000 Profitability of shareholders’ equity - % Inventories turnover - days

3,385.8

11,250.5

21.3 21.0

107.6 115.3

100.5

95.0

4,505.3

1,989.9

16.6 15.7

143.6

20.4

87.7 80.5

99.7

100.1

89.2 88.2

Note: Enterprises with 100 or more employees (acc. to P3-04)

Comparison of chosen financial economic indices for years 2004 and 2005

2004 2005 Total in f. c. relation total in f. c. relation

Assets as percentage of revenues - % Profitability of revenues - % shareholders’ equity - % assets - % Profits per employee - CZK 1,000

7.64.3

21.27.9

134.2

6.03.6

18.66.0

162.4

0.79 0.84 0.88 0.76 1.21

7.9 4.4

21.3 7.6

148.9

6.2 3.3

16.6 6.0

149.9

0.78 0.75 0.78 0.79 0.01

Productivity (of revenues) - CZK 1,000 (of output) - CZK 1,000 (of value added) - CZK 1,000

3,146.1 2,893.7 538.5

4,518.2 4,119.7 707.9

1.44 1.42 1.31

3,385.8 3,122.4

562.7

4,505.3 4,149.2

657.5

1.33 1.33 1.17

Shareh.’ equity as percentage of assets - % 34.1 31.0 0.91 35.2 34.9 0.99 Inventories turnover - days 22.1 17.8 0.81 21.0 15.7 0.75 Explanations: Total – construction enterprises with 100 or more employees in total in f.c. – construction enterprises with 100 or more employees with foreign control Relation – ent. total = 1,00

The rate of ent. with foreign control on the output of ent. with 20 and more empl. 2001 2002 2003 2004 2005

17.4 % 15.0 % 18.3 % 16.9% 13.3%


68

In year 2004 and 2005, the enterprises with foreign control, in comparison to all enterprises of 100 and more employees: - were less profitable; but their revenues and own capital profitability improved in comparison to average and total average of profitability decreased by – 20%, - in year 2005 they feel behind by – 1.7 % in asset returns - compared to year 2004 decreased its leading position in height of economic result on 1 em-ployee - they overtook all other enterprises in productivity - in year 2005 decreased their dept to level 65 % - they have markedly shorter the stock turnover by – 5 days, it is by 25 %. In total we can characterized them as more efficient nut less profitable.

* * *

According to Czech National Bank, the construction enterprises with foreign control with base in Czech Republic in 2004:

- The revenues for goods and services reached the volume 80,756,032 mill. CZK. The construction enterprises participated on the revenues of all sectors by 3.2 % and this rate decreased by – 0.4 p.p. compared to year 2003.

- There were working 18,022 employees. Compared to last year, the number of employ-ees increased almost by 7 thousands and it is participation about 3 % on all sectors.

- They created the added value in height 14,372,407 mill CZK, which was 17.8 % of volume of revenues. In comparison to total of all enterprises, the rate of added value on revenues was lower by – 3.2 %. In volume of added value created by all sectors the construction enterprises participated by 2.7 %.

- In re-calculation to 1 employees, the volume of revenues for goods and services of construction enterprises reached 4.5 mill. CZK, which was by 9.6 % more than other enterprises in other sectors. It means that in construction enterprises there were higher “ gross productivity” in comparison to all enterprises with foreign control in other sec-tors.

- In re-calculation to 1 employee, the added value was created in volume 0.8 mill. CZK, it was lower by 7.2 % than in average in other enterprises in all sectors. It means that construction enterprises fell behind by total average in creating “ net productivity”.

Enterprises with foreign control with base in Czech Republic

Sales Employees Value added Sales Value added mil. CZK persons mil. CZK thousands CZK / employee

Total 2,536,079.566 100.0 %

620,367 533,245.885 21.0 %

4,088.031 100.0 %

859.565 100.0 %

Construction - rate of total - relation to total

80,756.032 100.0 % 3.2 %

18,022

2.9 %

14,372.407 17.8 % 2.7 %

4,480.970

109.6 %

797.492

92.8 %


69

Construction enterprises with inland capital participation in abroad in year 2004: - The revenues for goods and services reached the volume 10,032,478 mill CZK. They

participate on revenues of all enterprises of all sectors by 7.0 %, which was less than last year.

- There were working 4,342 employees which was the most of all enterprises in all sec-tors. The number of employees increased by 500 from last year.

- They created the added value in volume 2,310,566 mill CZK. In comparison to year 2003, the volume of added value increased 1,5times and construction enterprises par-ticipate on the rate of added value by 15.7%.

- In “gross” and “net” productivity, the construction enterprises fell behind on enter-prises in all sectors when reached only 39.7 % of average value of revenues in re-calculation to 1 employee, resp. 89.9 % of average height of added value.

Enterprises with inland capital participation abroad

Sales Employees Value added Sales Value added mil. CZK persons mil. CZK thouands. CZK / employee

Total 144,445.116 100.0 %

24,812 13,285.025 9.2 %

5,821.583 100.0 %

535.427 100.0 %

Construction - rate of total - relation to total

10,032.478 100.0 % 7.0 %

4,342

17.5 %

2,088.163 20.8 % 15.7 %

2,310.566

39.7 %

480.922

89.8 %

* * * As a strong aspects of Czech construction enterprises it can be considered

- the ability to construct buildings of the highest technical requirements, quality and dif-ficultness which was evidenced by realization of number of inland and foreign pro-jects,

- the high quality of architects and designers which related to qualitative university edu-cation and professional tradition,

- high qualification and ability of individual decision making also in craft professions, - relatively good education and professional tradition of workers in all categories, - low prices of construction works and low labour costs, - understanding to conditions of home market, east-European markets and markets of

countries of third-world, previous customers of Czechoslovakia and contacts.

The weak aspects are: - decreasing numbers of qualified craftsmen, - critically low numbers of apprentices, especially in some specializations, - insufficient quality of works on small constructions (as an effect of cancelling the manda-

tory building inspectors) - absolutely and relatively high number of small enterprises (in comparison to foreign coun-

tries).


70

Sources - Chapter II: Sources of the Czech Statistical Office: Organizační statistika – stav k 31. 12. 2005 (Organisational statistics). Stavebnictví České republiky (do roku 2005) ( Construction of the Czech Republic (til year 2005)) Statistické ročenky ČR, ČSÚ (Statistical Yearbooks) Přehled vydaných stavebních povolení (Construction work permits) Statistika stavebních zakázek (Construction work orders) Indexy cen stavebních prací a stavebních objektů (Construction prices indices) Zaměstnanost a nezaměstnanost v České republice podle výsledků výběrového šetření pra-covních sil (Employment and unemployment in the Czech Republic) Evidenční počet zaměstnanců a jejich mzdy v ČR za 1. – 4. čtvrtletí 2004 (Registered number of employees and their wages in the Czech Republic (1st – 4th quarter of 2004)) Other sources: Top - Stav 100, in: Stavitel, No 12/2005 L’activité de la construction en Europe 2005, FIEC Stavebnictví v roce 2005 (Construction in 2005), ÚRS Praha, a. s., March 2006 Přímé zahraniční investice 2004 (Direct foreign investments 2004), ČNB


III

BUILDING MATERIALS

1. Building materials sector in the National economy

2. Number and structure of the building materials producers 3. Output of building materials

4. Employees and wages 5. Business results

The Czech Construction Industry 2006 III - Building materials

75

III - 1 BUILDING MATERIALS SECTOR IN THE NATIONAL ECONOMY

To this handbook the production of silicate building materials is included, it’s their production, modification and processing, in these sections: - Quarrying and preparation of stone (sector 141 NACE/OKEČ) - Quarrying and preparation of aggregates, sands, gravel sands, kaolin, clays etc. (sector 142 NACE/ OKEČ) - Manufacture of refractories (sector 2626 NACE/ OKEČ) - Manufacture of ceramic wall or floor tiles (sector 263 NACE/ OKEČ) - Manufacture of burnt bricks, roofing or tiles etc. (sector 264 NACE/ OKEČ) - Manufacture of cement, lime and plaster (sector 265 NECA/ OKEČ) - Manufacture of concrete, plaster, lime or cement elements (sector 266 NACE/ OKEČ) - Manufacture of other mineral non-metal products (sector 268 NACE/ OKEČ) (in total The industry of production of building materials - PBM). The sections which are strategical from viewpoint of national economy are: - quarrying and preparation of aggregates with good raw material basis, quarrying and prepa-ration of gravel sand and sand, its raw material basis is suitable but limited, - manufacture of burnt brick materials, roofing, tiling and similar products with suitable raw material basis - manufacture of cement, lime and plaster with good raw material basis and - manufacture of ceramic wall and floor tiles, with good raw material basis Good raw materials basis is also for manufacture of concrete, cement and plaster and manufacture of other mineral non-metal products. In each manufacturing sections large foreign companies have the leading position and it came or still coming to modernizing of manufacturing technologies and manufactured prod-ucts. Together with import, there is the supply of building materials comparable to advanced west-European markets.

* * * The industry of producing the building materials was in increase of revenues and profit in year 2005 as a whole, it is the reflection of positive development of building output. In comparison to year 2004 it came to increasing of created profit pre-tax , about + 5 %; the revenues increased by + 2.1% and assets increased by 1%. At same time in the year to year the productivity (of revenues, added value and output) and profitability (own capital and as-sets) increased.


76

III - 2 NUMBER AND STRUCTURE OF THE BUILDING MATERIALS PRODUCERS

The subjects dealing with activities in industry of producing building materials are the part of sub-category CB – “Quarrying other mineral raw-materials“ by NACE/OKEČ sectors 141 and 142, and sub-category DI - “Manufacture of glass, ceramics, porcelain and building materials“ OKEČ (sectors 2626, 263 to 266 and 268). - To Dec. 31.st, 2005 the number of registered subjects in sub-category CB reached 527 (in-creased by + 6% compared to year 2004) and these subjects participate on total number of registered economic subjects by 0.02 %. Mostly there were limited liability companies and private contractors, almost all not registered in the Commercial Register. - To Dec. 31.st, 2005, the number of subject registered in sub-category DI reached 11,764 (compared to 2004 decreased by – 54 subjects). On total number of registered subjects they participate by 0.5 %. Mostly there were private contractors not registered in the Commercial Register and limited liability companies.

Registered enterprises - sub-category CB and DI to Dec. 31.st, 2005

CB – Quarrying of other

raw-materials DI – M. of glass, ceramics, porcelain, build. Materials

number % % number % % Registered firms 527 100.00 - 11,710 100.00 - Firms of individuals - of which registered in the Commercial Register

182 7

34.54 1.33

100.00 3.85

9,913 88

84.65 0.75

100.00 0.89

Businesses - of which joint stock companies - limited liability companies

270 41 224

51.23 7.78

42.50

100.00 15.19 82.96

1,563 167 1,345

11.49 1.43

11.49

100.00 10.68 86.05

Co-operatives State enterprises

2 7

0.38 1.33

- -

35 10

0.30 0.09

- -

Hard competition influenced the supply or demand for construction materials. It re-sulted in concentration of productive capacities or in liquidation of small producers. Never-theless the core pattern of producers of building materials was stable since 1999.

Producers of building materials by sectors OKEČ Enterprises with 100 or more employees 2004 2005 141 142

Quarrying and preparation of stone Quarrying and preparation of aggregates, sands, gravel sands, kaolin, clays etc.

2 16

2 12

2626 263 264 265 2651 266 268

Manufacture of refractories Manufacture of ceramic floor or wall tiles Manufacture of burnt bricks, roofing, tiles etc. Manufacture of cement, lime or plaster - of which of cement Manufacture of concrete, plaster, lime or cement elements Manufacture of other non-metal mineral products

9 7 7 4

36 13

1

7 6 7 4

40 12

1 T o t a l 91 87

The biggest producers of building materials, according to volume of yearly profit, vol-ume of assets and number of employees, were in year 2004 these enterprises:


77

Sales Fixed assets Direct employees # bill CZK # bill CZK # WIENERBERGER cihlářský průmysl, a.s. 1. 2,626,832 1. 2,268,669 2. 528 ZAPA beton a.s. 2. 2,053,673 4. 1,400,006 4. 397 Lafarge Cement, a.s. 3. 1,105,652 2. 2,178,145 ŽPSV a.s. 4. 972,705 3. 1,770,684 1. 626 BEST, a.s. 5. 785,246 5. 980,458 10. 237 KÁMEN Zbraslav, spol. s r.o. 6. 746,372 6. 843,796 8. 245 ILBAU spol. s r.o. 7. 689,886 13. 331,437 14. 120 Prefa Brno a.s. 8. 580,592 10. 407,238 3. 401 PREFA-BETON Cheb, spol. s r. o. 9. 499,437 15. 229,512 16. 107 KM Beta a.s. 10. 493,597 14. 267,093 5. 378 BETA Olomouc a.s. 11. 479,893 11. 406,404 7. 332 CIDEM Hranice, a.s. 12. 444,854 7. 796,020 6. 350 KOTOUČ ŠTRAMBERK, spol. s r.o. 13. 423,960 8. 754,640 9. 244 KB - Blok systém, s.r.o. 14. 351,694 9. 635,427 11. 178 B & BC, a. s. 15. 332,094 16. 171,679 13. 144 Kámen a písek, spol. s r.o. 16. 306,748 12. 370,800 15. 115 BETONBAU, s.r.o. 17. 250,305 18. 118,096 17. 103 TOPOS spol. s r.o. 18. 238,730 17. 128,479 12. 168


78

III - 3 OUTPUT OF BUILDING MATERIALS

The raw materials and manufacturing capacities are equally located in all regions of Czech Republic, except enterprises for manufacturing cement and kaolin, which is significant from economic view point. This fact let to wide spread the quarrying and manufacturing of silicate raw materials. Similarly as whole Czech economy, also these sectors of industry of producing building materials went through significant changes which took effect also in vol-umes and structure of output. The volume of profit from selling own goods and services in year 2005 increased by +3.1 % to almost 2 bill. CZK. The biggest relative and absolute growth was in sector “manu-facturing of concrete, plaster, lime and cement elements“ (+ 1.7 bill. CZK). The volume of profit decreased in “quarrying and preparation of stone” (- 9.1% resp. – 1.3 mil. CZK)

Profit of sale own goods and services

2004 2005 05/04 OKEČ mill CZK curr.prices index 141 142

Quarrying and preparation of stone Q. and p. of aggreg., sands, gravel sands, kaolin, clays etc.

- 7,920.6

- 6,637.9

- 83.8

2626 263 264 265 2651 266 268


3,093.1 -

4,375.9 10,039.3

7,840.7 20,904.3

6,989.9

2,812.4 -

4,417.1 10,485.6

8,195.5 22,585.9

7,329.8

90.9 -

100.9 104.9 104.5 108.0 104.9

T o t a l 59,585.3 61,404.7 103.1 Note: According to low number of enterprises there are no data for sectors 263, 141 The manufacture of selected commodities in natural units in each sectors in year 2004 and 2005 developed:

The growth was only in two commodities. The quarrying of limestone (the most im-portant commodity in volume), as raw material for manufacturing of cement and lime and for desulphurization of thermal power plants increased more than about 4 %.

141 - Quarrying and preparation of stone (in 1,000 metric tons) 2004 2005 index 2005/2004

Granite Sandstone Limestone

175.1 27.6

6 726.9

196.4 23.0

7 023.6

112.2 83.4

104.4 The 16 % decrease of profit in sector 142 had no connection to decrease of production in volume. The highest relative increase was noticed in case of siliceous sands almost by + 30%.


79

142 - Quarrying and preparation of aggregates, sands, gravel sands, kaolin and clays

(in 1,000 metric tons) 2004 2005 index 2005/2004

Siliceous sands Gravel sands Crushed aggregates Kaolin floated

2,079.5 15,703.4 28,846.8

901.3

2,701.4 15,643.1 30,324.9

1,019.0

129.9 99.6

105.1 113.1

The 9% decrease in profit volume in sector 2626 was partly influenced by decrease of physical production of some products. It do not include the magnesite refractories.

2626 - Manufacture of refractories (in 1,000 metric tons) 2004 2005 index 2005/2004

Magnesite refractories Dinas Fireclay Other shaped refractories Non-shaped refractories

34.9 8.7

26.1 67.0 82.0

28.5 8.8

24.9 66.2 96.1

81.6 101.8

95.5 98.8

117.2 The production of ceramic tiles and floors decreased by + 2,6% in natural units.

263 - Manufacture of ceramic floor or wall tiles (in 1,000 sq. metres) 2004 2005 index 2005/2004

Tiles non-glazed Tiles glazed

8.6 24.1

8.2 23.6

95.4 98.1

The growth of sales for burnt bricks, roofing etc. reflected the growth of output of these commodities in natural units.

264 - Manufacture of burnt bricks, roofing etc. 2004 2005 index 2005/2004

Burnt bricks (in 1,000 brick units) Burnt roofing (in 1,000 metric tons)

1.3 0.2

1.4 0.2

105.2 100.8

The highest increase of output in natural units was in cement production, the highest relative increase was in SOMS (plaster mixtures) 107.8 %.

265 - Manufacture of cement, lime and plaster (in 1,000 metric tons) 2004 2005 index 2005/2004

Cement Lime (burnt) Lime hydrate Plaster SOMS

3.8 1.1 0.2 0.1 1.4

4.0 1.0 0.2 0.1 1.5

103.9 96.7 90.2 87.9

107.8


80

In sector 266, the highest absolute and relative increase was in manufacturing of fibre-cement plates which increased about more than 7.8 mill. tons in comparison to year 2004. Significant growth was also in sector of production of prefabricated construction elements.

266 - Manufacture of concrete, plaster, lime or cement elements 2004 2005 index 2005/2004

Roofing of concrete (in 1,000 metric tons) Pref. Construction elements (1,000 cu. ms.) Plaster cardboard plates (in 1,000 sq. ms.) Fibre-cement plates (in 1,000 sq. metres)

1.7 0.7

38.7 15.0

1.6 0.7

36.4 22.8

101.0 102.7

94.1 152.0


81

III - 4 EMPLOYEES AND WAGES

The trend of decreasing the number of employees continued also in year 2005 when number of employees, in enterprises for production of building materials with 100 and more employees, decreased by – 1.2 %, resp. 291 persons (from 24,299 to 24,008 employees). Ex-cept “manufacturing of cement, lime and plaster” (by + 5.7 %, resp. by 472 persons) the num-ber of employees decreased in all other sectors, relatively and absolutely the highest decrease was in sector “quarrying and preparation of stone” (by – 17.6 %, resp. by – 533 persons).

Average number of direct employees by sectors

2004 2005 05/04 OKEČ persons index 141 142

Quarrying and preparation of stone Q. and p. of aggregates, sands, gravel sands, kaolin, clays

- 3,032

- 2,499

- 82.4

2626 263 264 265 2651 266 268


2,276 -

1,999 2,034 1,422 8,313 3,203

2,064 -

1,746 1,975 1,369 8,785 3,087

90.7 -

87.3 97.1 96.3

105.7 96.4

T o t a l 24,299 24,008 98.8 Nominal monthly wages grew up year to year by +3.2 % and reached 22,234 CZK in 2005. Wages grew up in all sectors, particularly in sector “Manufacture of burnt bricks, roofing etc.“ (by +5.8 %). On the other hand wages in sub-sector “Manufacture of refractories“ grew up by +0.3 % only. Wages of this sector was the lowest of all others, it reached only 80% of total average.

Average nominal monthly wages

Enterprises with 100 or more employees 2004 2005 05/04 OKEČ CZK index 141 142


- 20,755

- 21,112

- 101.7

2626 263 264 265 2651 266 268


17,929 -

20,712 30,463 34,510 20,894 19,734

17,981 -

21,912 32,016 35,651 21,493 20,599

100.3 -

105.8 103.6 103.3 102.9 104.4

T o t a l 21,355 22,234 103.2


82

The productivity of labour, of added value, grew up by +1.4 % in 2005. The highest growth rate was achieved by “Manufacture of non-metal mineral products“ (+8.3 %), or by “Manufacture of burnt bricks, roofing etc.“, by more than + 8 %). In sector of manufacturing of refractories the productivity decreased by almost - 5%.

The productivity of labour of sectors is different. In 2005 the highest productivity was reached by the sector “Manufacture of cement, line or plaster“ (CZK 3.2 mill.); it exceeded the overall productivity by 177 %, particularly thanks to the productivity of the “Manufacture of cement“. On the other hand, the lowest productivity was achieved by the “Manufacture of refractories“ (CZK 0.560 mill., resp. 57 % as percentage of the overall productivity).

Productivity of labour of added value

Enterprises with 100 or more employees 2004 2005 05/04 OKEČ CZK index 141 142


- 895.9

- 859.7

- 96.0

2626 263 264 265 2651 266 268


587.1-

1,137.52,543.43,019.0

865.3707.5

560.2 -

1,231.9 2,705.6 3,242.8

877.0 766.5

95.4 -

108.3 106.4 107.4 101.3 108.3

T o t a l 961.2 974.4 101.4


83

III - 5 BUSINESS RESULTS (ENTERPRISES WITH 100 OR MORE EMPLOYEES)

The year 2005 was successful for enterprises with production of building materials from view point of economical results, the betterment was in few parameters, e.g.: - the growth in revenues and also in created profit and profitability, - the growth of revenues absolutely and also for 1 CZK of assets. The revenues in year 2005 increased by + 1.5 bill. CZK, outputs and profit for selling own goods and services by + 2 bill. CZK, it’s by + 3.0 %. As it was said before, the produc-tivity of labour also increased and there was positive development of relation between growth of productivity and wages. This positive trend influenced also next economical indices. The significant positive fact is also slight growth of added value, in the industry PBM as a whole by + 0.2%. But in each sector, the volume of created added value increased only in sectors 265, 266, 268. The assets returns developed positively; in whole PBM it reached the value almost 0.95 CZK per 1 CZK of assets. In comparison to last year, it increased in year 2005 by + 0.8 %. The most profitable asset was in “Manufacturing of refractories” (2626) where achieved value 1.33 CZK per 1 CZK of assets but with year to year decrease by – 4.0 % and in “manu-facturing of concrete, plaster, lime and cement elements” (sector 266) reached value 1.28 CZK per 1 CZK of assets but also with year to year decrease by – 7.0 %. More than 1 CZK of revenues was achieved also in sectors 264 and 268. The lowest revenues profitability was in “quarrying and preparation of stone”.

OKEČ 142 2626 264 265 2651 266 268 Total R/A % index

90.2 105.0

132.8 96.0

113.4 104.6

72.6 115.4

74.7 118.0

128.0 93.1

111.1 87.6

95.8 100.8

Notes: R/A – revenues per CZK 1 of assets in 2004 index - year 2004 = 100 The number of profit-making enterprises (with 100 or more employees) in the year 2005 decreased from 80 to 72 together with increasing the profit by + 3.9 %. The number of loosing enterprises increased from 11 to 15 but their loss decreased by – 12.2%. In sectors 2626 and 265 were profit-making companies only. The created profit pre-tax in the year 2005 increased by + 388 mill. CZK, it’s by + 4,8% to 8,4 bill. CZK. Except “Manufacturing of refractories” and “Quarrying and preparing of sand and clays and aggregates”, where the volume of created profit decreased down to about 90 % of last year. The highest absolute profit growth was reached in sectors “Manufac-turing of cement, lime and plaster”.


84

OKEČ 142 2626 264 265 2651 266 268 Total

Profit 329.4 305.5 844.9 3,218.0 2,815.7 2750.0 593.7 8,395.0 index 40.7 85.6 105.1 116.0 119.8 105.5 87.3 104.8

change -480.7 -51.3 40.9 444.4 465.5 142.8 -86.3 387.8 Explanation: Profit and change in mill. CZK; index and changes against year 2004; This facts influenced the significant profitability growth: in industry of PBM as a whole the profitability of revenues increased by + 0.3 p.p. to 11.2 %, profitability of share-holder’s capital by 0.2 p.p. to 19.0 % and profitability of assets by 0.3 p.p. to 11.7 %. The increase of profitability was in different sectors and in each profitability different and in some sectors the decrease appeared, that is why the whole profitability growth was not so signifi-cant.

OKEČ 142 2626 264 265 2651 266 268 Total 3.8 9.5 13.3 25.1 27.4 10.1 6.8 11.2P(r)

change -4.8 -0.7 0.1 -1.2 -1.0 0.4 -0.1 0.35.6 17.9 24.9 30.9 38.6 22.0 13.2 19.0P(e)

change -6.4 -2.4 0.5 2.9 3.3 -0.8 -3.5 0.24 13 16.4 19.5 22 13.7 8.5 11.7P(a)

change -3.9 -1.7 0.8 1.5 2.1 -0.6 -1 0.3 Notes: P(r) – profitability of revenues, P(e) – profitability of equity, P(a) – profitability of assets in %t in 2005 Change against year 2004 in percent points The growth of created profit and profitability influenced also the profit re-calculated per 1 employee, which increased in PBM industry in year 2005 by + 6.1 % and which grew only in sectors of manufacturing of cement and plaster and manufacturing of bricks and burnt roofing. The increase of dept as the rate of external sources to assets, which increased in whole PBM industry by + 1.4 p.p. to 43.3 % is relatively low. The highest increase in dept was in “manufacturing of mineral and non-metal elements” by + 5.3 p.p. and in sectors 2651 and 264 it increased by + 2 p.p.

OKEČ 142 2626 264 265 2651 266 268 Total 38.83 29.55 39.47 41.08 47.03 41.11 42.48 43.3 CZ / A

change -0.25 0.77 1.94 -0.02 2.03 0.15 5.33 1.44 Explanations: CZ/A – external sources/assets in %,change against year 2004in percent points The stock turnover increased by 0.2 days in whole PBM industry. The time of turn-over and its shortage or prolongation differed among sectors and showed specifics of each sector. The shortage was in sectors 265, 268 where the time shortened to 0.6 resp. 0.2 days. The longest turnover was in “manufacturing of refractories (sector 2626), about 19 days and “Manufacturing of burnt bricks and roofing” (sector 264), almost 13 days.


85

OKEČ 142 2626 264 265 2651 266 268 Total turnover change

7.791.00

18.82 1.72

12.932.75

6.83-0.61

7.22-0.7

7.960.44

9.19 -0.22

9.560.19

Explanation: the stock turnover in days; changes against year 2004 in days Sources (Chapter III): Statistické ročenky ČR, ČSÚ (Statistical Yearbooks of the Czech Republic), CZSO Přehled ukazatelů sociálního a ekonomického rozvoje ČR, ČSÚ (Indicators of the social and economic development of the Cz. R.), CZSO Vybrané obory průmyslu stavebních hmot v roce 2005, ÚRS Praha, a.s., duben 2006 (Selected sectors of building materials as in 2005), ÚRS Praha, a. s., April 2006 TOP - STAV 100, v: Stavitel č. 12/2005 (TOP-STAV 100, in: Stavitel, No 12/2005)


IV

INTERNATIONAL COMPARISON

1. General indicators 2. Gross domestic product 3. Gross fixed capital 4. Construction industry 5. Housing

Note: Data shown in these tables serves mostly for mutual comparison of indicators of introduced countries. Therefore there are data of same or most similar year or period. It concerns also data for Czech Republic, its data with same or detailed information or more actual are shown in section V.

The Czech Construction Industry 2006 IV – International comparison

IV - 1 GENERAL INDICATORS

IV - 1.1 POPULATION

Total population as at

July 1st 2001

Economic activity rate

as at 2001 Population density

in 2000

mill. persons % of population (f) persons per sq. km Czech Republic (a) Belgium (a) Denmark (a,b) Finland (a) France (c) Ireland Italy Hungary Germany Netherlands (a) Norway (a) Poland Portugal Austria (a) Slovakia (a) Slovenia United Kingdom of GB and NI (d) Spain (e) Sweden (a) Switzerland

10.2

10.3

5.3 5.2

59.2 3.3

58.0 9.9

82.4 16.0

4.5 38.6 10.0

8.1 5.4 2.0

59.8 40.3

8.8 7.2

60.0

52.2

53.5 (g) 50.6 (h)

44.6 59.1 48.7 (i) 53.3 (h) 57.2 63.4

. 56.3 (j) 62.3 58.2 60.3 57.9 50.2 (k) 44.5 (k)

50.0 (l.i) 67.4

130

336

124 15 107 54 192 108 230 382 14 120 109 97 110 98

246 78 20 174

Notes: (a) de iure population (b) Faeroe Islands and Greenland excluded (c) overseas departments excluded (d) the Isle of Man and the Channel Islands excluded (e) incl. Balearic Isles, Canary Islands and the North Africa territories (f) persons aged from 15 (g) persons aged from 15 to 66 years (h) persons aged from 15 to 74 years (i) incl. persons on compulsory military service (j) armed forces excluded (k) persons aged from 16 years (l) persons aged from 16 to 64 years

Source: Statistická ročenka ČR 2003 (Statistical Yearbook of the Czech Republic), CZSO

89


IV - 1 GENERAL INDICATORS

IV - 1.2 ROADS AND RAILWAYS

Total length (1,000 kms)

Density rations

(kms per 100 sq. kms)

roads, highways

railways

roads, highways

railways

Czech Republic

127.7

9.4

162

12

Belgium Denmark Finland

147.1 71.6 77.9

3.4 2.2 5.9

482 167

23

11 5 2

France Italy Hungary

984.3 316.4

30.2 (8)

31.8 16.0

7.7

179 105 32

6 5 8

Germany Netherlands Norway

649.2 116.1 (7)

91.5

38.4 2.8 4.0

64 280

28

11 7 1

Poland Portugal Austria

371.7 68.8 (7)

106.0

23.3 3.0 5.7

115 71 127

7 3 7

Slovakia Slovenia United Kingdom

17.7 20.1

396.1

3.7 1.2

17.0

36 99 163

7 6 7

Spain Sweden Switzerland

162.8 139.1

71.2

12.3 9.9

32.9

32 31 172

2 2 7

Notes: (7) as in 1997 (8) as in 1998 Source: Statistická ročenka ČR 2002 (Statistical Yearbook Cz.R. 2002), CZSO

90


IV - 2 GROSS DOMESTIC PRODUCT

IV – 2.1 GROSS DOMESTIC PRODUCT PER CAPITA IN PURCHASING POWER PARITY

2000 2001 2002 2003 2004

Czech Republic

64.4

64.6

67.2

68.3

70.1

Belgium Denmark Estonia Finland France Ireland Italy Cyprus Lithuania Latvia Luxembourg Hungary Malta Germany Netherlands Poland Portugal Austria Greece Slovakia Slovenia United Kingdom Spain Sweden

116.0 125.9

43.2 114.1 114.7 125.7 110.4

85.6 38.2 35.2

217.0 53.1 77.1

113.0 120.7

45.9 79.9

126.9 72.0 47.6 72.7

113.6 93.2

118.9

116.3 125.0

44.4 113.9 115.2 128.4

*110.4 88.5 40.4 37.1

211.5 56.0 72.7

111.2 123.1

45.5 76.5

123.3 73.0 48.5 74.1

114.4 94.1

115.4

116.0 120.8

46.3 113.5 113.4 131.8

*108.3 82.9 42.1 38.7

211.2 58.2 72.6

110.1 121.3

45.3 76.2

121.3 77.1 51.1 74.8

117.5 96.2

114.0

117.0 121.2

48.7 113.3 111.7 131.5

*106.1 81.6 45.5 40.7

213.2 59.6 72.4

109.2 120.1

45.7 74.2

121.5 80.6 52.0 76.3

*118.8 *98.9 114.4

118.5 121.7

50.7 114.5 110.4 138.6

*105.0 81.3 47.8 43.3

*222.3 61.0 71.3

109.0 *119.4

46.8 *72.6 122.2

81.8 52.1 78.0

*119.1 *98.3 116.1

EU 25

100.0

100.0

100.0

100.0

100.0

Bulgaria Croatia Romania Turkey

26.8

*41.3 25.2 30.1

28.3

*41.9 26.5 25.9

28.6

*43.6 28.5

*26.4

29.6

*45.2 29.5

*27.5

29.9

*46.0 31.7

*28.9

Notes: * preliminary values, evaluation

Source: Statistická ročenka ČR 2005 (Statistical Yearbook Cz.R. 2005), CZSO

91



IV – 2.2 PRODUCTIVITY OF LABOUR (PER 1 EMPLOYEE)

2000 2001 2002 2003 2004

Czech Republic

59.2

60.4

60.9

61.8

64.0


125.5 104.1

44.8 110.6 123.5 121.7 119.0

77.6 36.4 38.2

155.0 60.8 88.9

102.4 102.1

50.5 68.8

106.4 86.8 54.7 69.8 97.6 98.6

106.7

125.7 104.6

45.9 110.2 124.1 123.9 116.3

78.4 40.3 39.5

145.5 64.5 83.6

101.6 103.9

49.8 68.6

104.4 89.7 56.1 71.6 99.1 98.6

103.1

126.3 101.8

47.1 109.1 122.1 127.8 112.4

72.9 45.2 40.3

142.7 66.9 84.6

101.3 102.6

50.5 68.5

103.2 94.9 59.1 72.7

101.5 100.0 102.0

127.6 103.2

48.5 108.9 120.8

*126.9 109.6 *72.1

47.4 41.3

142.4 67.3 85.5

101.3 102.3

58.0 *67.3 103.6

97.9 59.0 74.2

101.7 101.7 102.7

129.2 104.0

50.6 110.3 120.4

*132.2 108.5 *72.3

49.8 43.3

146.3 69.3 83.7

100.9 *103.2

59.7 *66.3 105.1

96.8 59.5 76.0

101.6 100.2 105.4

EU 25

100.0

100.0

100.0

100.0

100.0


31.7

- 28.2

*39.9

32.9

- 30.2

*35.7

33.0

- 32.5

*37.5

31.8

- *33.6 *40.1

*31.1

- 36.0

*41.8

Source: Statistická ročenka ČR 2005(Statistical Yearbook Cz.R. 2005), CZSO

92



IV – 2.3 RATE OF LONG-TERM UNEMPLOYMENT

2000 2001 2002 2003 2004

Czech Republic

4.2

4.2

3.7

3.8

4.2


3.7 1.0 5.7 2.8 3.5 1.6 6.3 1.3 8.0 7.9 0.6 3.0 4.4 3.7 0.8 7.6 1.7 1.0 6.2

10.2 4.0 1.4 4.8 1.4

3.2 0.9 8.7 2.5 3.0 1.3 5.7 1.0 9.2 7.2 0.6 2.5 3.7 3.7 0.6 9.3 1.5 0.9 5.5

11.4 3.5 1.3 3.9 1.0

3.6 0.9 5.0 2.3 3.1 1.3 5.1 0.8 7.2 5.7 0.8 2.4 3.4 3.9 0.7

10.8 1.7 1.1 5.3

12.2 3.4 1.1 3.9 1.0

3.6 1.1 4.7 2.3 3.7 1.5 4.9 1.1 6.1 4.3 0.9 2.4 3.3 4.5 1.0

10.8 2.2 1.2 5.3

11.4 3.4 1.1 3.9 1.0

3.8 1.2 4.8 2.1 3.9 1.6 4.0 - 5.5 4.3 1.0 2.6 3.4 5.4 1.6

10.2 3.0 1.2 5.6

11.7 3.1 1.0 3.5 1.2

EU 25

100.0

100.0

100.0

100.0

100.0


9.4 - 3.5 1.4

11.9

- 3.2 1.8

11.7

- 4.0 3.1

8.9 - 4.2 2.5

7.1 - 4.2 2.2

Source: Statistická ročenka ČR 2005 (Statistical Yearbook Cz.R. 2005), CZSO

93


IV - 3 GROSS FIXED CAPITAL

IV - 3.1 SHARE OF GFC IN THE PRIVATE SECTOR IN GDP

2000 2001 2002 2003 2004

Czech Republic

24.7

24.3

22.9

22.4

22.9


19.3 18.4 21.7 17.1 16.3 20.9 17.4 14.3 16.4 23.2 16.9 20.3 18.2 19.7 19.0 21.1 24.2 21.3 19.5 23.1 22.0 15.7 22.8 14.8

19.2 18.3 22.9 17.6 16.4 19.1 17.3 14.1 18.0 14.0 18.4 19.7 15.5 18.3 18.3 17.2 23.2 20.9 19.8 25.7 21.5 15.2 22.6 14.4

17.9 18.3 24.0 16.0 15.7 18.4 17.9 15.2 17.5 22.8 16.8 18.5 10.3 16.6 17.2 15.4 21.5 19.4 20.3 24.3 20.5 15.1 22.7 13.4

17.3 17.9 25.5 15.3 15.6 19.7 16.6 14.0 18.4 22.9 14.9 19.0 14.5 16.1 16.6 15.0 19.3 20.2 21.6 23.1 21.1 14.3 23.6 12.6

17.0 17.9 25.2 15.8 15.9

*20.7 16.9 14.6 18.7 23.9 14.3 19.2 16.4 15.8 17.1 14.8 19.3 19.9 21.4 22.2 21.9 14.5 24.3 12.9

EU 25

18.4

100.0

100.0

100.0

100.0


12.1

- 17.0

-

14.7

- 18.3 18.1

15.3

- 18.2 16.6

16.5

- 19.1

-

17.8

- *19.1

-

* preliminary data Source: Statistická ročenka ČR 2005 (Statistical Yearbook Cz.R. 2005), CZSO

94


IV - 4 CONSTRUCTION INDUSTRY

IV – 4 CONSTRUCTION IN EU

Construction production in EU22 countries reached in year 2004 volume of 951 bill. Euro, it is around 10 % from rate of created GDP. There were more than 12,7 mil. persons working in the same year in construction, which is around 7 % of all workers. In the year 2004 Germany participate in whole construction production by 20 % and “the big five”, which is Germany, United Kingdom, France, Italy and Spain, participate in whole construction production by 75 %. From the year 1999 the construction growth rate was decreasing and year 2004 could be considered as year of upturn (+1.5 %); economic recovery in EU countries, which started already in the end of year 2003, contribute too. In the sense of economic trends – another improvement is expected during year 2005 (+ 1.9 %).

Those data are conclusions of all 22 EU countries as an average, single data defers from each other in different countries. For example Germany is in decrease of construction production already fifth year ( -2.5 %) or Netherland (-1,1 %) and Portugal (- 4.9 %), the situation is caused by weak output in dwellings section (-8%) and civil engineering works (-4%). Germany is also the only country , where the decrease of construction production is expecting in year 2005.

On the other hand, Great Britain reached positive growth rate data (+3.4%), there was main growth of new dwelling construction (+14.2%) but on other side there was a rapid decline in civil engineering works ( -8.3%); France (+3.3%) also with main increase in new dwelling construction (+9.2%; Spain (+4.1%), mostly public investments to dwelling construction started already in 1998. Others are Belgium (+4.4%) with very good results in private sector of non-residential construction (+7.9%) and new dwelling construction (+8.3%)+ Ireland (+6.3%) even with increase of two digits in new construction (+12.6%); and Denmark (+4.2%) also with very good result in new dwelling construction (+12.6%) and non-residential construction both private and public (+14.6%).

Italy, in year 2004, was already sixth year in growing indices, although they have

decreasing tendencies, which will continue also in year 2005. Among new member countries, there is Hungary (+6.2%) with the best results in construction production thanks to dwelling construction, private non-residential buildings and engineering buildings. Sources: L’activité de la construction en Europe 2005 FIEC (Fédération de l’Industrie Européenne de la Construction)

95



IV - 4.1 CONSTRUCTON OUTPUT AND GDP

2 0 0 3 2 0 0 4 2 0 0 4 GDP Cons.prod. Cons/GDP GDP Cons.prod. Cons/GDP C 04/03 bill. Euro % bill. Euro % %

Czech Republic 79 8 9.7 82 9 11.0 112.5Belgium 270 23 8.5 281 25 8.9 108.7Denmark 188 22 11.7 196 24 12.2 109.1Estonia 7 1 12.9 9 1 12.2 122.2Finland 143 18 12.6 150 20 13.3 111.1France 1 557 122 7.8 1 625 131 8.1 107.4Ireland 138 23 16.7 146 26 17.8 113.0Italy 1 302 113 8.7 1 358 118 8.7 104.4Cyprus 12 1 6.9 12 1 7.3 112.5Luxembourg 24 1 4.2 25 1 4.0 100.0Hungary 73 7 10.1 77 8 10.4 114.3Germany 2 128 208 9.8 2 178 206 9.5 99.0Netherlands 454 48 10.6 466 48 10.3 100.0Poland 185 19 10.3 195 23 11.8 121.1Portugal 130 21 16.2 134 21 15.7 100.0Austria 226 16 7.1 235 16 6.8 100.0Greece 153 15 10.5 165 15 10.9 100.0Slovakia 31 2 7.1 34 3 8.8 150.0Slovenia - - - 26 2 1.8 - United Kingdom 1 619 137 8.5 1 703 145 8.5 105.8Spain 745 129 17.3 799 145 18.1 112.4Sweden 244 16 6.6 255 17 6.7 106.3 EU 22

9 708

951 9.8 10 151 1 004 9.9

105.6

Bulgaria 17 1 5.9 19 1 5.3 100.0Norway 195 21 10.8 202 22 10.9 104.8Romania 50 4 8.0 58 5 8.6 125.0Switzerland 281 32 11.4 285 32 11.2 100.0Turkey 212 7 3.3 240 10 40.2 142.9

Notes and explanations: GDP a construction production values in common prices C04/03 – year-on-year change of construction production volume in year 2004 Source: L’activité de la construction en Europe, FIEC, 2005

96



IV - 4.2 YEAR TO YEAR CHANGES IN CONSTRUCTION OUTPUT BY TYPE OF CONSTRUCTION – EU COUNTRIES

Const. Constructions works build. residential from build. non-residen. from build. civil e.. Σ Σ Σ new r + m Σ private public Σ

Belgium

2000 2001 2002 2003 2004* 2005*

3.4 0.4

-4.8 -3.5 4.4 9.9

2.2 1.3

-4.9 -4.3 5.1 7.6

0.7 1.5

-0.7 0.9 4.7 4.0

-0.7 0.6

-4.4 -0.6 8.3 6.6

2.0 2.3 2.2 2.0 2.0 2.0

3.7 1.0

-8.9 -9.8 5.6

11.7

1.6 3.1

-10.7 -14.6

7.9 7.5

8.3 -3.3 -4.8 0.1 1.6

19.6

8.3 -3.3 -4.8 0.1 1.6

19.6 Czech Republic 2000

2001 2002 2003 2004* 2005*

0.3 5.2 1.5 8.0

10.4 5.0

-5.0 6.4 0.5 9.5 9.6 5.9

-13.4 2.5 2.2

-0.6 23.0

5.7

-19.7 2.2 2.1

-5.0 25.0

6.0

3.7 3.0 2.4 8.6

19.3 5.0

0.1 4.8 0.1

12.2 6.4 6.0

6.1 8.4 2.5

10.6 7.1 4.0

-7.8 -0.8 -3.9 15.0

5.2 9.4

6.3 6.7 3.0 5.8

11.6 3.6

Denmark

2000 2001 2002 2003 2004* 2005*

3.4 5.6 0.3

-1.4 4.2 3.7

6.4 4.3 0.9

-3.3 8.2 4.4

8.1 -5.2 10.5

5.3 6.8 6.7

-9.7 16.4 18.9

5.0 12.6

6.6

27.2 -21.5

0.9 5.7

-0.8 6.8

13.0 12.1 -5.3

-13.2 14.6

3.7

10.5 14.8 -6.9

-15.0 16.2

5.3

20.6 4.3 0.0

-8.0 10.2 -1.0

-5.1 9.6

-1.5 4.4

-7.2 1.4

Finland

2000 2001 2002 2003 2004* 2005*

5.8 -1.3 -0.6 0.5 3.1 2.8

8.3 -2.2 -0.5 0.4 2.8 2.9

8.2 -8.6 2.3 6.9 6.5 5.0

8.8 -13.4

-0.1 12.0 10.0

5.0

7.6 -3.7 4.5 2.5 3.0 5.0

8.4 5.7

-3.4 -7.0 -2.0 0.0

4.7 3.9

-9.2 -6.9

- -

23.8 12.0 15.6 -7.0

- -

-1.8 1.6

-0.8 0.7 4.0 2.5

France

2000 2001 2002 2003 2004* 2005*

7.1 1.8

-0.5 0.5 3.3 2.7

5.7 1.5

-0.2 -1.0 3.4 2.9

5.1 -0.3 0.3 0.3 4.9 4.1

2.4 -0.5 0.1 0.3 9.2 6.6

7.2 -0.1 0.5 0.3 1.7 2.0

6.6 4.0

-1.0 -2.8 1.1 1.2

7.2 5.1 0.2

-5.5 -1.6 0.5

5.3 1.7

-3.9 3.7 7.0 2.7

11.1 2.8

-1.1 4.5 3.0 2.0

Ireland

2000 2001 2002 2003 2004* 2005*

6.7 3.5

-0.7 0.9 6.3 1.9

6.4 0.8

-1.8 4.1 6.9

-0.4

7.3 4.8 2.1 9.7

10.9 -3.0

11.5 5.4 6.1

20.2 12.7 -4.9

-0.3 3.4

-6.3 -15.4

4.8 3.6

5.9 -6.4 -8.7

-27.9 -3.6 8.1

3.3 -12.0 -16.8 -30.2

-2.7 6.3

10.7 15.2 11.3

-23.6 -5.2 11.1

7.7 13.9

2.8 -9.4 3.9 2.8

Italy

2000 2001 2002 2003 2004* 2005*

5.9 3.0 3.3 1.8 1.3 1.2

6.3 3.0 3.6 1.7 1.1 1.1

5.3 1.4 4.4 2.3 1.5 1.3

6.2 0.3 6.0 3.1 1.0 0.5

4.5 2.5 3.0 1.5 2.0 2.0

8.0 5.6 2.2 0.9 0.5 0.8

9.3 6.3 2.5 0.5 0.0 0.5

3.0 2.5 1.0 2.5 2.5 2.0

3.0 2.5 1.0 2.5 2.5 2.0

Cyprus

2000 2001 2002 2003 2004* 2005*

-1.2 3.8

14.1 6.4 - -

-1.0 3.0

17.5 10.2

- -

3.0 -0.4 7.9

17.8 - -

0.5 -0.3 8.0

20.6 - -

22.7 -1.2 7.5

-0.9 - -

-3.9 9.4 5.1

-6.1 - -

1.0 16.9

3.8 -7.6

- -

-11.8 -4.1 7.9

-2.8 -

-1.8 6.3 3.6

-6.9 - -

97



IV - 4.2 YEAR TO YEAR CHANGES IN CONSTRUCTION PRODUCTION BY TYPE OF CONSTRUCTION – EU COUNTRIES

(continuation 1)

Const. Construction works build. residential from build. non-residen. from build. civil e. Σ Σ Σ new r + m Σ private public Σ

Hungary 2000 2001 2002 2003 2004* 2005*

4.5 6.2

12.8 5.9 6.2 5.6

4.5 5.5

13.0 8.9 4.5 1.7

5.4 4.1

25.7 11.8

1.4 -2.8

4.0 3.8

17.3 7.4 2.9

-3.8

11.8 5.3

60.0 25.0 -2.5 0.0

3.9 6.3 5.4 6.8 6.9 5.0

2.5 5.6 6.1 3.6 3.4 0.0

10.0 9.1 2.8

18.9 18.2 19.2

4.6 7.9

12.2 -0.7 10.2 14.6

Germany

2000 2001 2002 2003 2004* 2005*

-2.7 -4.8 -5.8 -3.3 -2.5 -1.0

-2.5 -5.1 -6.3 -3.8 -2.6 -1.2

-2.6 -6.2 -5.9 -2.7 -1.3 -0.7

-8.2 -16.4

-9.4 -0.7 -2.4 -1.9

3.7 4.3

-3.0 -4.3 -0.4 0.3

-2.3 -2.6 -7.0 -6.0 -5.4 -2.4

-1.3 -1.5 -7.0 -6.1 -5.1 -2.6

-7.0 -7.5 -7.1 -5.4 -6.9 -1.2

-3.3 -3.1 -3.2 -0.8 -2.0 0.0

Netherlands

2000 2001 2002 2003 2004* 2005*

4.6 1.8

-2.7 -4.4 -1.1 1.5

3.9 0.5

-3.6 -5.2 -0.5 2.4

2.4 -1.1 -3.5 -3.0 1.6 2.7

1.8 -3.5 -6.0 -4.1 2.5 4.0

2.9 1.4

-1.1 -2.1 0.7 1.5

5.9 2.5

-3.7 -7.8 -3.1 1.9

3.9 1.4

-9.0 -11.1

-5.4 0.7

14.7 7.1

17.2 2.5 2.9 5.0

7.0 5.7

-0.2 -2.2 -2.5 -1.0

Poland

2000 2001 2002 2003 2004* 2005*

1.0 -6.4

-10.0 -5.0 3.3 9.9

2.0 -5.6 -8.4

-13.1 -0.2 8.1

10.9 -1.0 -5.1 15.3

2.3 4.9

18.0 7.6

-5.3 26.8

0.0 6.5

2.2 -13.5

-4.8 -5.0 5.3 4.0

-1.2 -7.4

-17.4 -19.3

0.9 7.5

-1.7 -7.6

-18.3 -20.7

1.9 7.3

4.3 -5.3 -8.0 -8.7 -4.8 8.8

-3.0 -10.0

6.8 5.5

14.6 15.0

Portugal

2000 2001 2002 2003 2004* 2005*

4.9 1.1

-1.6 -11.6

-4.9 0.9

5.7 -0.1 -2.1

-12.1 -5.2 -0.5

6.8 -1.2 -3.7

-17.7 -7.8 -2.6

7.0 -1.5 -4.0

-18.0 -8.0 -3.0

6.0 0.3

-2.1 -16.4

-6.7 -0.5

2.8 2.8 2.1 1.7

-0.2 3.3

3.5 2.3 2.4 1.9 1.1 2.7

1.5 3.8 1.4 1.4

-2.8 4.7

2.5 5.0 0.0

-10.0 -4.0 5.0

Austria

2000 2001 2002 2003 2004* 2005*

2.0 -1.2 1.7

11.8 2.8 1.6

1.5 -1.5 -1.7 10.4

4.8 -2.2

1.1 -1.9 -2.8 11.0

5.6 -2.0

-2.8 -3.6 -4.5 9.0 3.2

-2.7

6.1 0.0 0.6

14.8 9.9

-0.7

1.9 -0.9 -0.2 9.6

-0.1 1.3

- -1.8 2.9

11.7 0.8 0.5

- 1.9

-9.4 2.5

-3.2 4.3

3.8 -0.4 7.2

13.9 2.3 4.8

Slovakia

2000 2001 2002 2003 2004* 2005*

-2.7 -4.8 -5.8 -3.3 -2.5 -1.0

-3.1 -1.2 -0.8 5.0 2.3 2.2

-10.8 5.3

10.8 8.5 1.5 1.9

-17.3 67.6 11.7

2.5 1.4 1.9

-34.8 -51.2

7.8 28.2

1.5 2.0

3.8 -6.0

-10.6 1.2 3.2 2.5

10.4 1.8

-13.2 -5.1 -8.0 0.7

- - - - - -

33.9 20.6 19.8 -2.2 1.5 7.1

98



IV - 4.2 YEAR TO YEAR CHANGES IN CONSTRUCTION OUTPUT BY TYPE OF CONSTRUCTION – EU COUNTRIES

(continuation 2)

Const. Construction works build. residential from build. non-residen. from build. civil e. Σ Σ Σ new r + m Σ private public Σ

United Kingdom of Great Britain and Northern Ireland

2000 2001 2002 2003 2004* 2005*

1.5 2.5 4.2 5.0 3.4 3.5

0.7 0.7 2.9 6.7 6.6 6.0

2.1 -1.5 4.2 8.0 7.3 6.8

11.0 -5.6 5.5

12.7 14.2 11.2

-2.1 0.7 3.5 5.6 3.5 4.1

-0.4 2.6 1.8 5.6 6.0 5.3

0.9 2.6

-2.7 0.3 4.4 2.7

-4.6 2.7

16.8 20.4

9.8 11.0

4.5 9.5 8.9

-0.8 -8.3 -7.0

Spain

2000 2001 2002 2003 2004* 2005*

6.4 5.8 4.6 3.9 4.1 3.4

6.2 4.4 3.1 2.8 3.4 3.4

7.1 4.0 2.9

¨3.1 4.1 4.4

9.0 4.0 2.0 3.0 5.0 6.0

3.4 4.1 4.8 3.4 2.2 1.0

4.7 5.0 3.4 2.1 2.1 1.4

4.2 5.3

-0.1 0.8 1.4 2.7

7.5 3.4

24.3 8.5 5.1

-3.8

7.0 10.0

9.0 7.0 6.0 3.5

Sweden

2000 2001 2002 2003 2004* 2005*

4.6 6.0 3.5

-3.1 1.1 1.1

7.5 3.3 2.7

-4.1 0.6

-0.8

10.7 4.7

14.7 -0.1 11.0 -0.6

17.2 6.4

13.5 6.4

18.5 -2.5

2.9 2.3

16.4 -9.0 -0.9 3.0

5.5 2.3

-5.3 -7.3 -8.4 -1.0

10.4 1.8

-13.2 -5.1 -8.0 0.7

-3.7 3.5

11.9 -10.9

-9.2 -4.2

-2.4 13.3

5.6 -0.6 2.2 5.3

E U

2000 2001 2002 2003 2004* 2005*

3.0 1.0 0.1 0.6 1.5 1.9

2.7 0.2

-0.4 0.3 2.1 2.1

2.8 -1.2 0.9 1.8 3.4 2.5

2.5 -3.9 0.3 3.3 5.5 3.5

3.8 1.4 1.7 0.6 1.7 2.0

3.1 2.2

-1.7 -1.9 0.3 1.6

3.7 2.7

-3.4 -3.7 -0.4 0.8

1.4 0.5 4.4 3.3 2.1 3.2

3.6 3.7 1.8 1.4

-0.3 1.0

Notes and explanations: changes in % in comparable prices against last year r + m - repairs and maintenance * preliminary data Source: L’activité de la construction en Europe, FIEC, 2005

99



IV - 4.3 STRUCTURE OF CONSTRUCTION OUTPUT IN EU

2 0 0 3 2 0 0 4 Bill.€ % Bill.€ %

Czech Republic 8 0.8 9 0.9 Belgium 23 2.4 25 2.5 Denmark 22 2.3 24 2.4 Estonia 1 0.1 1 0.1 Finland 18 1.9 20 2.0 France 122 12.8 131 13.0 Ireland 23 2.4 26 2.6 Italy 113 11.9 118 11.8 Cyprus 1 0.1 1 0.1 Luxembourg 1 0.1 1 0.1 Hungary 7 0.7 8 0.8 Germany 208 21.9 206 20.5 Netherlands 48 5.0 48 4.8 Poland 19 2.0 23 2.3 Portugal 21 2.2 21 2.1 Austria 16 1.7 16 1.6 Greece 15 1.6 15 1.5 Slovakia 2 0.2 3 0.3 Slovenia - 0.8 2 0.9 United Kingdom 137 2.4 145 2.5 Spain 129 2.3 145 2.4 Sweden 16 0.1 17 0.1 EU 22

951 100.0 1 004 100.0

Source: L’activité de la construction en Europe, FIEC, 2005

100



IV - 4.4 LABOUR IN CONSTRUCTION INDUSTRY

2000 2001 2002 2003 2004 2005 Labours - thousands persons

Czech Republic 392 371 370 378 380 382Belgium 232 233 230 239 240 244Denmark 170 170 168 164 165 169Finland 149 145 148 151 148 150France 1,430 1,471 1,493 1,502 1,512 1,522Ireland 166 180 186 200 214 220Italy 1,559 1,641 1,674 1,742 - - Cyprus 26 27 27 32 32 - Hungary 253 280 274 302 336 340Germany 2,761 2,587 2,428 2,312 2,252 2,180Netherlands 478 489 484 469 452 455Poland 815 737 659 570 620 - Portugal 596 586 622 584 551 545Austria 276 265 258 255 255 253Slovakia 127 125 128 132 135 138United Kingdom 1,492 1,545 1,629 1,589 1,703 1,770Spain 1,612 1,725 1,823 1,907 2,001 2,061Sweden 181 188 190 192 194 196 EU

12,716

12,764 12,790 12,718 -

-


101



IV - 4.5 EMPLOYEES OF CONSTRUCTION INDUSTRY IN YEAR 2005

IN EU COUNTRIES

Number Year-to-year change

Ratio of employees Ratio OSVČ.

thousands % Czech Republic 382 100.53 42.93 52.62 Belgium 244 101.67 79.10 20.90 Denmark 169 102.42 86.98 12.43 Finland 150 101.35 79.33 20.67 France 1,522 100.66 85.15 14.85 Ireland 220 102.80 Hungary 340 101.19 Germany 2,180 96.80 79.82 20.18 Netherlands 455 100.66 84.40 15.60 Portugal 545 98.91 75.05 24.95 Austria 253 99.22 93.28 6.72 Slovakia 138 102.22 61.59 39.13 United Kingdom 1,770 103.93 59.94 40.06 Spain 2,061 103.00 78.55 21.45 Sweden 196 101.03 85.20 14.80


102


IV - 5 HOUSING

IV - 5.1 STOCK OF DWELLINGS

Stock of dwellings (in 2nd half of the nineties) acc. property relations thousands per 1000 inhabitants own (%)

Czech republic (a) 3,828 374.4 46 Belgium Denmark Finland France Ireland Germany Netherlands Austria United Kingdom Sweden

3,974 2,476 2,450

28,740 1,212

37,050 6,522 3,191

24,598 .

391.0 467.2 475.4 491.0 327.0 452.0 414.0 399.0 418.0

.

71 56 64 53 75 41 51 51 69 59

EU 15 . . 59 Norway Switzerland

1,901 3,508

427.6 510.0

22 .

Hungary Poland Slovakia

4,048 11,688

1,682

401.1 302.0 312.0

11 50

.

IV - 5.2 DWELLINGS BY NUMBER OF ROOMS

Number of rooms 1 2 3 - 5 6 and more per inhabitant p e r c e n t rooms

Czech republic 7 27 62 5 1.0 (a) Denmark Finland France Germany Austria United Kingdom Sweden

6 11

6 2

10 1

12

19 14 12

6 23

2 22

62 63 64 72 59 64 55

13 11 16 20

9 34

9

2.8 .

2.4 2.4 .

2.8 .

Norway 6 15 61 19 . Hungary Poland

2 3

15 16

79 82(b)

4 -

.

.

Notes: (a) as at March 1st, 2001 (Census day)

(b) 3 or more rooms Sources: Výsledky sčítání lidu, domů a bytů k 1. 3. 2001 (Result of the census, 1st March 2001), CZSO Eurostat Yearbook 2003 (The statistical guide to Europe) Annual Bulletin of Housing and Building, Statistics for Europe and North America, UN/ECE, 1996, 1998 a 2000

103


IV - 5 HOUSING

IV - 5.3 DWELLINGS BY FLOOR AREA (completed in 1998)

Average dwelling area in sq. m

Percent proportion of dwellings by usable area in sq. m

usable habitable up to 49 50 - 99 100 - 199 200 - moreCzech republic 104.3 68.9 . . . . Belgium Denmark Finland France Ireland Italy (7) Germany Austria United Kingdom (1) Spain Sweden

203.0 . . .

87.6 154.9

.

.

. 94.7 79.5

133.1 79.4 81.8

. 70.0 87.4 90.7

.

.

.

.

. 13.1 24.6 13.4

.

. 13.8 15.4

7.0 . .

. 38.0 51.1 54.0

.

. 56.8 50.5 62.4

.

.

. 43.9 22.4 30.3

.

. 27.6 31.9 26.6

.

.

. 5.0 1.9 2.6 . .

1.7 2.1 4.0 . .

Norway Switzerland

152.2 91.0

131.0 .

.

. . .

.

. . .

Hungary Poland Slovakia

96.9 93.4

121.3

52.0 57.8 70.3

18.8 . .

63.2 . .

17.3 . .

0.5 . .

IV - 5.4 DWELLINGS AMENITIES (2nd half of the nineties) in %

Water supply Hot water Bathroom WC Centr. heat. (a) Czech Republic (1) 98 . 97 97 80 . Belgium Denmark Finland France Ireland Italy Germany Netherlands Portugal Austria United Kingdom Spain

94 .

97 100

97 97 97 99 82

100 100

98

96 99

. 98 94 98 95 99 79 97

100 97

96 97 94 97 99 98 98 99 85 97

100 99

. 98 98 97 97

.

.

.

. 94 98

.

. 98 91 82 59

.

.

.

. 69 85

.

87 86

. 55 94 89 83 96 74 74 95 73

Hungary Poland

85 91

.

. 80 80

76 80

48 71

.

. Notes: (1) as in 1991; (7) as in 1997; (a) balcony, terrace, garden Note: Many low-income households (income less than 60 % of median value) in southern countries of EU live in primitive conditions. In Greece, Spain and mainly in Portugal, more than 60 % of these households declare a lack of one of the basic amenities, i. e. bath or shower, flush toilet in the dwelling, central heating. Sources: Bytová výstavba v ČR (Construction of residential buildings), CZSO

Eurostat Yearbook 2003, The statistical guide to Europe, Eurostat, Housing

104


IV - 5 HOUSING

IV - 5.5 LIVING IN HOUSES AND FLATS AND DWELLING STATUS

Households living in Dwelling status houses flats * own rental percent (as in 1998)

Czech Republic ** 37 63 . . Belgium Denmark Finland France Ireland Italy Germany Netherlands Portugal Austria Greece United Kingdom Spain Sweden

77 58 54 57 92 33 38 67 67 45 47 81 39 48

23 42 46 43

8 67 62 33 33 55 53 19 61 52

71 56 64 53 75 71 41 51 66 51 74 69 82 59

29 44 36 47 25 29 59 49 34 49 26 31 18 41

EU 15 52 48 59 41 * in residential buildings ** estimated by census (March 1st, 2001) Notes: Two different trends are revealed in EU countries. In southern countries, low-income households (less than 60 % of median income) live predominantly in houses while households with higher-income (higher than 140 % of median income) live in flats. An opposite trend is observed in northern countries. In Greece, Spain and Portugal, low-income households live in a standalone houses, the opposite is observed in Denmark, Germany, Italy and Finland. It is also related to the level of urbanisation of particular country.

Proportion of dwelling ownership is higher in southern than in northern countries of EU whereas status (own – rented) is determined by income level. Many low-income households from southern countries live in primitive conditions. It is possible to assume that many low-income households live in small „overcrowded“ (more than 1 person per habitable room) dwellings. Great disparity between income groups is in Italy, Portugal, Ireland and Spain. In all countries are low-income households endangered by living in „overcrowd“ dwellings. Ownership is not generally influenced by the fact that the family has children; exceptions are Belgium, Denmark, Germany, Netherlands and Austria where having children does influence dwelling status. Sources: Předběžné výsledky sčítání lidu, domů a bytů k 1. 3. 2001 (Census preliminary data), CZSO Eurostat Yearbook 2003. The statistical guide to Europe.

105


V

SELECTED INDICATORS Czech Republic

TABLES

1. Selected macroeconomic indicators 2. Employment and wages 3. Housing 4. Construction 5. Building materials

The Czech Construction Industry 2006 V – Selected indicators CR

109

V - 1 SELECTED MACROECONOMIC INDICATORS

V - 1.1 COSTS AND SOURCES OF GDP

unit 2003 2004 2005 A b s o l u t e v a l u e s - c u r r e n t p r i c e s

GDP at purchasing prices bill. CZK 2,555.8 2,767.7 2,931.1 Final consumption expenditure - of which households government non-profit institutions

bill. CZK

1,919.4 1,300.5 604.4 14.6

2,011.2 1, 372.4

622.1 16.7

2,096.8 1,421.9

657.2 17.7

Gross capital formation - of which Gross fixed capital (GFC) - Construction (of GFC)

bill. CZK

696.1 685.6

765.8 749.9

772.9 773.9

Gross value added (at basic prices) - of which Construction

bill. CZK 2,321.7 165.3

2,482.6 173.5

2,612.0 177.3

A b s o l u t e v a l u e s - c o n s t a n t p r i c e s (1995) GDP at purchasing prices bill. CZK 1,694.7 1,774.2 1,879.8 Final consumption expenditure - of which households government non-profit institutions

bill. CZK

1,310.9 915.3 385.9 9.8

1,330.0 945.1 375.6

10.9

1,357.1 969.8 378.6

11.1 Gross capital formation - of which Gross fixed capital (GFC) - Construction (of GFC)

bill. CZK 559.9 549.8 205.0

604.3 579.0 211.4

604.8 600.4 211.1


bill. CZK 1,515.4 77.8

1,584.7 80.6

1, 689.0 81.2

Variation year to year - Constant prices (1995) GDP at purchasing prices index 103.2 104.7 106.0 Final consumption expenditure - of which households government non-profit institutions

index

104.4 104.6 103.8 103.2

100.5 103.3

97.3 111.3

102.0 102.6 100.8 101.9

Gross capital formation - of which Gross fixed capital

index 101.3 104.7

107.9 105.3

100.1 103.7


index 103.0 105.1

104.6 103.6

106.6 100.8

Note: Variation year to year – previous year = 100 (in constant prices)

V - 1.2 LONG-TERM DEVELOPMENT OF GDP

total GDP - current prices GDP per inhabitant bill. CZK 1990 = 100 CZK,curr. pr. 1990 = 100 USD exch.rate EUR, PPP

1995 1,466.7 220.5 141, 972 234.9 - 10,664 2000 2001 2002

2,150.1 2,315.3 2,414.7

323.2 348.1 363.0

209,302 226, 449 236,714

346.3 374.7 391.7

5,878 6,644 7,683

12,811 13,531 14,319

2003 2004 2005

2,555.8 2,767.7

2,931.1

384.2 416.1 440.7

250,526 271,161 286,367

414.5 448.6 473.8

7,867 8,499 9,615

15,406 15,936

-

Source: Čtvrtletní národní účty ČR ve 4. čtvrtletí 2005 (Quarterly national accounts of Czech republic – 4th quarter of 2005), CZSO


110


V - 1.3 OTHER INDICATORS

unit 2003 2004 2005

Z a h r a n i č n í o b c h o d - b ě ž n é c e n y Total export - of which goods services

bill. CZK

1,590.5 1,371.3

219.2

1, 962.1 1,713.7

248.4

2,134.8 1,875.2

259.6 Total import - of which goods services

bill. CZK

1,646.7 1,440.7

205.9

1,972.0 1,736.0

236.0

2,073.5 1, 834.9

238.6 Total export Total import

index 107.1 107.3

120.9 118.5

108.3 104.5

E x c h a n g e r a t e s CZK / EUR CZK / USD

31.84 28.22

31.90 25.70

29.78 23.95

F i n a n c i a l i n d i c a t o r s Balance of payments - current account Commercial balance Government budget - balance (accumulated)

bill. CZK

-160.6 -69.8 -109.1

-167.3 -26.4 -93.7

-61.7 40.4

-56.3

Industrial output Construction works Retail sales

index

105.8 111.2 104.7

109.9 104.5 103.2

108.1 103.7 103.1

Industrial producers prices construction works prices consumers prices

index

99.7 102.2 100.1

105.7 103.7 102.8

103.0 103.0 101.9

Inflation rate (as at the end of the year) % 1.0 2.8 2.2 Unemployment (as at the end of the year) % 7.8 8.3 7.9

V - 1.4 NUMBER OF SUBJECTS REGISTERED BY THE CZSO

2003 2004 2005 thousands

T o t a l 2,326.0 2,352.6 2,388.5 Private entrepreneurs - individuals - of which registered in the Commercial Register

1,771.9 20.8

1,774.3 18.7

1,781.1 17.9

Commercial companies - of which joint stock companies

232.2 15.9

224.5 16.4

256.7 17.0

Co-operatives State enterprises

13.1 0.9

13.3 0.8

13.8 0.7

Sources: Čtvrtletní národní účty ČR ve 4. čtvrtletí (Quarterly national accounts of Czech republic – 4th quarter), CZSO Ukazatele sociálního a hospodářského vývoje ČR (Social and economic development indica-tors), CZSO Indikátory měnového a hospodářského vývoje, (Monetary and economic development indica-tors), ČNB

http://wdb.cnb.cz/cnb/docs/STATPUBL/INDIKATORY.PDF


111


I - 1.5 GROSS FIXED CAPITAL FORMATION FACTUAL DIVISION

current prices

2003 2004 2005 A b s o l u t e v a l u e s - b i l l. C Z K

Total - Housing + other buildings and structures - Other machinery and equipment + vehicles

- other

685.6 329.8 319.3

36.6

743.8 356.1 345.6

42.0

773.9 365.9 363.2

44.8 S a m e p e r i o d o f p r e v i o u s y e a r = 100

Total - Housing + other buildings and structures - Other machinery and equipment + vehicles

- other

- - - -

108.5 108.0 108.3 115.0

104.1 102.7 105.1 106.6

S t r u c t u r e in % - t o t a l f o r m a t i o n = 100 Total

- Housing + other buildings and structures - Other machinery and equipment + vehicles - other

48.1 46.6

5.3

47.9 46.5

5.6

47.3 46.9

5.8 Source: Time series, CZSO


112


V - 1.6 DIRECT FOREIGN INVESTMENTS IN THE CzR – by countries

Order Geographical a eco-nomical zones

Basic capital in bill. CZK

Reinvested profit in bill. CZK

Other capital in bill. CZK Total in bill. CZK

WORLD TOTAL 184,592.0 78,199.9 414.3 263,206.2 1. Spain 112,498.9 5,069.5 61.6 117,630.0 2. Netherlands 13,916.6 23,714.1 9,902.2 47,532.8 3. Germany 4,051.2 22,768.0 -127.1 26,692.1 4. Poland 15,130.6 1,690.9 9.7 16,831.2 5. Austria 2,355.2 10,052.3 -1,404.6 11,002.9 6. Sweden 1,257.5 1,320.4 4,386.5 6,964.4 7. Switzerland 3,347.1 1,123.6 1,698.3 6,169.1 8. Great Britain 4,173.2 318.7 1,042.8 5,534.7 9. France 1,419.2 3,649.7 196.5 5,265.4

10. Belgium -69.9 3,937.5 550.8 4,418.4 11. Slovakia 1,567.4 2,081.6 173.7 3,822.6 12. Luxembourg 3,878.0 -326.7 149.4 3,700.6 13. Japan 3,017.2 -867.2 1,157.1 3,307.1 14. USA -93.5 2,763.3 -112.7 2,557.2 15. Guernsey 501.4 334.6 50.0 886.0 16. Italy 58.6 254.9 382.7 696.2 17. Lichtenstein 762.4 32.0 -110.8 683.5 18. Finland 408.3 159.4 50.0 617.7 19. Marshall Islands 398.7 2.8 0.0 401.6 20. Korea 245.5 0.1 1.9 247.5 21. Ukraine 207.5 15.1 -0.6 222.0 22. China 195.0 0.6 0.0 195.6 23. Slovenia 141.4 44.4 0.0 185.8 24. Hungary 0.0 208.9 -35.3 173.6 25. British Virgin Islands 164.3 -52.9 6.1 117.5 26. Latvia 101.1 3.8 0.0 104.9

V - 1.7 DIRECT FOREIGN INVESTMENTS IN THE CzR – by sectors

Income in 2005 Sectors Basic capital Reinvested profit Other capital Total bill. CZK bill. CZK bill. CZK bill. CZK MANUFACTURING INDUSTRY 17,347.1 26,624.9 286.7 44,258.7Metals. metal products 7,499.7 8,124.8 -240.8 15,383.8Machinery and equipment prod. 1,345.9 239.10 881.4 2,466.3Other non-metallic mineral prod. 514.0 1,550.9 -236.0 1,828.9CONSTRUCTION 18.0 3,100.8 -898.3 2,220.5RAW-MATERIALS 0.0 1,256.7 0.8 1,257.5Source: Přímé zahraniční investice 2005 (Direct foreign investments 2005), ČNB 2006


113

V - 2 EMPLOYMENT AND WAGES

V - 2.1 EMPLOYMENT (4th. quarter of 2004)

Employees *

Direct empl.

thousands % 2004 = 100 thousands Construction industry

457.5

9.5

101.4

293.1

Agriculture, forestry, hunting, fishing etc. Mining/quarrying of mineral raw materials Manufacturing Production/supply of electricity, gas, water

144.5

52.2 1,319.1

73.5

3.0 1.1

27.5 1.5

91.2 94.0

103.0 97.9

117.4

50.7 1,222.7

69.9 Trade, repairs of mot. vehicles and cons. goods Hotels and restaurants Transport, storage, posts, telecommunications

612.1 181.1 356.8

12.7

3.8 7.4

96.5

104.7 99.7

462.6 144.5 310.9

Financial intermediation Real estate, renting, business activities

98.2

304.1

2.0 6.3

103.5 109.8

77.6

198.8

Public administration, defence, social care Education Health care, veterinary and social activities Other public, social and personal services

339.7 306.4 322.7 189.6

7.1 6.4 6.7 3.9

105.9 108.2

95.9 100.3

319.8 296.4 294.7 135.3

T o t a l

4,803.7

100.0

101.5

4,029.6

* Employees with one or main employment Source: Zaměstnanost a nezaměstnanost v ČR podle výsledků výběrového šetření pracovních sil, 4. čtvrtletí 2005(Employment and unemployment in the CzR, sample research results. Q4 of 2005), CZSO


114

V - 2 EMPLOYMENT AND WAGES

V - 2.2 AVERAGE NOMINAL MONTHLY WAGES – 2005

Wage

Increase

Growth

Relation

CZK CZK % %

Construction industry

18,963

Agriculture, forestry, hunting Fishery Mining/quarrying of mineral raw-materials Manufacturing industry Production/supply of electricity, gas, water

13,878 15,986 22,484 17,825 24,186

732 618

1,332 790

1,558

105.6 104.0 106.3 104.6 106.9

72.9 84.0

118.2 93.7

127.1

Trade, repairs of motor. vehicles or cons.goods Hotels and restaurants Transport, storage, post, telecommunications

19,040 13,393 20,579

694 395

1,161

103.8 103.0 106.0

100.1

70.4 108.1

Financial intermediation Real estate, renting, business services

37,406 21,147

1,980 1,566

105.6 108.0

196.6 111.1

Public administration, defence, social care Education Health care, veterinary and social activities Other public, social or personal services

22,307 17,184 17,529 15,622

1,817

770 776 885

108.9 104.7 104.6 106.0

117.2

90.3 92.1 82.1

T o t a l of which Business sphere Non-business sphere

19,030

995

105.5

100.0

Increase: absolute in CZK in comparison with year 2004 Growth: relative in % in comparison with year 2004 Relation: sector in comparison with total average; total average = 100 Source: Evidenční počet zaměstnanců a jejich mzdy v ČR (Number of employees and their wages), CZSO


115

V - 3 HOUSING V - 3.1 STOCK OF HOUSES AND DWELLINGS

(according to Census at 1st March 2001) V - 3.1.1 D e v e l o p m e n t

1961 1970 1980 1991 2001 thousands HOUSES - total - permanently inhabited - family houses

. 1,615.6 1,424.2

. 1,627.7 1,408.1

1,830.9 1,634.4 1,384.1

1,859.9 1,597.1 1,352.2

1,969.6 1,630.7 1,407.2

as percentage of total number HOUSES - permanently inhabited - family houses

.

. . .

89.3 75.6

85.9 72.7

82.8 71.4

thousands FLATS - total - permanently inhabited

. 2,845.2

3,216.6 3,088.8

3,781.4 3,494.8

4,077.2 3,705.7

4,369.2 3,827.7

as percentage of total number FLATS - permanently inhabited . 96.0 92.4 90.9 87.6 percentage Average number of flats per house Average number of rooms* per 1 flat Avg. num. of inhabitants per 1 flat** Avg. num. of inhabitants per room*

1.76** 1.80 3.36 1.87

1.90**2.10 3.18 1.51

2.14 2.41 2.94 1.22

2.32 2.66 2.78 1.05

2.35 2.72 2.67 0.98

* habitable rooms with 8 or more sq. meters of floor area ** in permanently inhabited houses

3.1.2 Stock of houses and dwellings structure in 2001 Communities with Houses (%) Houses (%) *** Flats (%)

inhabitants inhabited * family * uninhab. ** family * uninhab. ** inhabited * up to 1999 2000 - 4999 5000 - 9999 10000 or more T o t a l

44.4 14.6

9.2 31.8

100.0

49.1 15.3

9.2 26.4

100.0

67.3 13.3

6.6 12.7

100.0

95.4 90.8 85.5 71.7 86.3

23.9 16.0 13.0

7.7 17.2

23.9 10.2

8.5 57.4

100.0 * permanently inhabited ** permanently uninhabited *** total number of houses in relevant community size = 100 % Sources: Předběžné výsledky sčítání lidu, domů a bytů k 1. 3. 2001(Preliminary results of the Census), CZSO Regionální portréty 2001 (Regional profiles), CZSO


116

V - 3 HOUSING

V - 3.2 STARTED AND COMPETED DWELLINGS

V - 3.2.1 Absolute values

Started dwellings Completed dwellings Under.con.new adapted total new adapted N + A modern. total

1990 61,004 . . 44,594 . . . 158,840 1991 1992 1993 1994 1995

10,899 8,429 7,454 10,964 16,548

.

.

.

.

.

.

.

.

.

.

41,719 36,397 31,509 18,162 12,662

.

.

.

. 336

.

.

.

. 12,998

2,039 330 242 195 2,061

128,228 97,768 72,356 62,117 66,172

1996 1997 1998 1999 2000

21,481 31, 370 33,255 31,313

29,502

1,199 1,782 1,772 1,587 2,875

22,680 33,152 35,027 32,900 32,377

14,037 15,904 21,245 22,299 23,074

445 853 938

1,435 2,133

14,482 16,757 22,183 23,734 25,207

2,725 4,645

6, 078 8,755 10,725

73,452 90,552 103,191 113,530 118,785

2001 2002 2003 2004 2005

27,599 32,383 35,326 35,899 38,856

1,384 1,223 1,170 2,138 1,525

28,983 33,606 36,496 39,037 40,381

22,960 25,598 25,999 30,904 30,678

1,799 1,693 1,128 1,364 2,185

24,759 27,291 27,127 32,268 32,863

13,435 13,599 12,761

15, 469 21, 896

121,705 129,609 139,132 146,801 155,202

V - 3.2.2 Indices

Started dwellings Completed dwellings Under.con.new adapted total new adapted N + A modern. total

1991 1992 1993 1994 1995

17.9 77.3 88.4 147.1

150.9

.

.

.

.

.

.

.

.

.

.

93.6 87.2 86.6 57.6

69.7

.

.

.

.

.

. . . .

. 16.2 73.3 80.6

1056.9

80.7 76.2 74.0 85.8 106.5

1996 1997 1998 1999 2000

125.6 146.0 106.0 94.2

94.2

. 148.6

99.4 89.6

181.2

. 146.2 105.7

93.9 98.4

110.9 113.3 133.6 105.0

103.5

132.4 191.7 110.0 153.0

148.6

111.4 115.7 132.4 107.0 106.2

132.2 170.5 130.9 144.0

122.5

111.0 123.3 114.0 108.9 105.6

2001 2002 2003 2004 2005

93.5 117.3 109.1 101.6 108.2

48.1 88.4 95.7

182.7 71.3

89.5 116.0 108.6 107.0 103.4

99.5 111.5 101.6 118.9

99.3

84.3 94.1 66.6 120.9 110.4

98.2 110.2

99.4 119.0 101.8

125.3 101.2 93.8

121.2 141.5

102.5 106.5 107.3 105.5 105.7

Notes: adapted - dwellings in adapted previously non-residential areas Under con = under construction to 31.12. Sources: Bytová výstavba v roce 2005 (Dwellings development 2005), CZSO


117

V - 3 HOUSING

V - 3.3 DWELLINGS BY TYPES - STARTED DWELLINGS

1999 2000 2001 2002 2003 2004 2005 percentage from the total number of dwellings: dwellings in ⇓

p e r c e n t a g e

family houses of which for investor’s use for sale after completing

38.0 (95.3)

(4.7)

37.6 (94.4)

(5.6)

44.5 (95.7)

(4.3)

40.6 (95.6)

(4.4)

47.3 (94.0)

(6.0)

44.8 (92.2)

(7.8)

43.5 (92.9)

(7.1)apartment houses of which in houses of co-operatives in municipal houses other

21.9 (5.5)

(45.2) (49.3)

21.9 (10.0) (51.6) (38.4)

21.7 (12.0)(41.0)(47.0)

30.5 (12.2) (42.9) (45.0)

27.5 (13.1) (37.7) (49.2)

30.5 (4.7)

(16.9)(78.4)

33.6 (3.1)

(14.5)(82.4)

house extensions, attics, penthouses community care service h., senior’s boarding h. non-residential buildings adapted non-residential rooms

27.4 4.2 3.8 4.8

24.5 2.6 4.5 8.9

19.6 4.7 4.8 4.8

16.2 5.4 3.6 3.6

16.0 2.8 3.2 3.2

13.7 2.2 3.4 5.5

13.0 1.3 4.8 3.8

Dwellings started in 2005– numbers by type of house, by development and by use

Family houses Apartment houses Other Σ total own use sale total co-op. municip other extens. comm.c. non-r. adapt.

17,579 16,337 1,242 13,574 423 1,968 11,183 5,244 527 1,932 1,525 40,381

V - 3.4 DWELLINGS BY TYPES - COMPLETED DWELLINGS

1999 2000 2001 2002 2003 2004 2005

percentage from the total number of dwellings: dwellings in ⇓

p e r c e n t a g e

family houses of which for investor’s use for sale after completing

38.9 (95.1)

(4.9)

41.5 (97.3)

(2.9)

43.2 (95.8)

(4.2)

42.9 (96.0)

(4.0)

42.0 (95.3)

(4.7)

41.3 (94.0)

(6.0)

41.0 (96.1)

(3.9)apartment houses of which in houses of co-operatives in municipal houses other

27.8 (1.4)

(44.2) (54.3)

23.5 (8.9)

(48.9) (42.1)

23.9 (15.1)(45.2)(39.3)

23.4 (9.3)

(41.2) (49.5)

28.4 (19.0) (33.7) (47.2)

33.2 (13.9) (34.0) (52.1)

35.1 (12.0) (12.1)

(66.19)house extensions, attics, penthouses community care service h., senior’s boarding h. non-residential buildings adapted non-residential rooms

21.3 2.7 3.4 6.0

20.8 2.7 3.0 8.5

19.5 2.8 3.3 7.3

17.2 6.3 3.9 6.2

14.5 6.4 4.5 4.2

14.0 5.1 2.2 4.2

11.7 3.2 2.4 6.6

Dwellings completed in 2005 – numbers by type of house, by development and by use

Family houses Apartment houses Other Σ total own use sale total co-op. municip other extens. comm.c. non-r. adapt.

13,472 12,943 529 11,526 1,384 2,430 7,712 3,839 1,047 794 2,185 32,863 Note: in brackets - as percentage of the number of dwellings in the respective type of house Source: Bytová výstavba v roce 199 - 2005 (Dwellings development in year 199 – 2005), CZSO


118

V - 3 HOUSING

V - 3.5 DWELLING BY REGIONS

2003 2004 2005

D w e l l i n g s ⇒ started completed started completed started completed R e g i o n ⇓ p r o c e n t a

Prague Středočeský Jihočeský Plzeňský

Karlovarský

15.6 20.7

6.5 5.6 2.8

16.3 17.2

5.4 6.3 1.9

17.8 20.4

6.6 5.1 2.6

18.4 19.0

6.8 6.3 1.6

20.1 23.7

5.8 4.2 1.7

21.5 18.8

6.2 5.8 3.6

Ústecký Liberecký

Královéhradecký Pardubický Vysočina

3.1 5.0 3.8 5.6 5.3

4.5 4.2 4.7 4.4 4.9

3.2 3.7 3.1 4.8 4.9

2.8 4.1 4.1 4.9 4.9

3.4 2.4 4.9 4.2 4.0

2.9 3.5 4.3 4.5 4.4

Jihomoravský Olomoucký

Zlínský Moravskoslezský

10.5 5.3 4.3 5.8

12.2 5.2 5.1 7.7

13.8 4.6 4.2 5.2

11.9 4.5 4.6 6.2

12.1 4.4 4.1 5.0

11.2 3.1 4.4 5.7

V - 3.6 CANCELLED DWELLINGS

Number : 2000 2001 2002 2003 2004 - cancelled buildings 1,044 956 1,389 1,060 1,001 - cancelled dwellings 2,120 2,025 2,006 2,239 1,678

V - 3.7 COMPLETED DWELLINGS BY NUMBER OF ROOMS

In apartment houses In family houses number of rooms number of rooms

betsit. 1 2 3 4+ ∅ betsit 1 2 3 4 5+ ∅ percentage per dw percentage per dw

2000 2001 2002 2003 2004

8.5 9.7

11.5 7.9

15.1

22.8 21.3 31.5 21.2 27.0

37.5 36.7 31.1 38.3 28.6

25.7 25.1 20.7 26.0 21.9

5.5 7.2 5.2 6.6 7.4

2.02 2.10 1.90 2.10 1.90

0.3 0.4 0.3 0.4 0.3

1.1 1.2 1.1 1.3 0.9

5.4 5.4 5.4 4.6 4.6

17.0 17.4 15.9 16.0 15.8

31.0 31.7 32.0 33.5 33.6

45.1 43.9 45.3 44.2 44.8

4.40 4.37 4.40 4.40 4.40-


119

V - 3.8 COMPLETED DWELLINGS BY FLOOR AREA

Floor area of 1 dwelling Dwellings Floor area of 1 flat Dwellings

habitable usable per house habitable usable per house Family houses (FH) Apartment houses (AH)

2000 2001 2002 2003 2004

96.9 96.3 97.0 96.6 97.0

155.4 151.7 153.0 152.7 151.5

1.1 1.1 1.1 1.1 1.0

45.2 48.0 43.7 49.3 47.5

67.7 68.0 61.1 67.5 66.7

18.0 18.4 19.6 17.8 20.3

FH –extensions, attics, penthouses AH –extensions, attics, penthouses 2000 2001 2002 2003 2004

63.2 64.2 64.3 64.9 65.3

95.5 97.5 96.6 97.4 97.1

1.0 1.0 1.0 1.1 1.1

48.3 51.8 53.7 55.5 49.7

71.3 77.4 78.4 79.4 71.1

2.6 2.5 2.6 2.4 3.2

Other house types 2000 2001 2002 2003 2004

39.8 41.0 38.1 37.4 39.9

59.8 58.9 57.5 55.6 68.1

4.0 3.9 4.7 4.6 4.2

Source: Statistická ročenka ČR 2005 (Statistical Yearbook of the CzR 2005), CZSO


120

V - 4 CONSTRUCTION

V - 4.1 CONSTRUCTION FIRMS (with 25 or more employees)

2001

2002

2003

2004

2005

Total number

2,210

2,242

2,247

2,404

2,498

Firms : percentage number with 20 - 24

25 - 49 50 - 74 75 - 99

100 - 199 200 - 299 300 - 399 400 - 499 500 - 999

1000 or more employees

19.1 45.5 14.8 7.2 8.4 2.4 0.9 0.5 0.8 0.4

19.0 46.0 15.3

6.8 8.2 2.1 0.9 0.4 0.7 0.4

20.0 45.4 15.8

6.5 7.8 2.1 0.8 0.5 0.6 0.4

24.3 43.8 13.8

6.7 7.2 2.1 0.7 0.4 0.6 0.4

25.0 43.6 14.1

6.1 7.0 2.0 0.8 0.4 0.6 0.4

625

1,089 353 153 176

50 19

9 16 10

- non-financial public - non-financial private - under foreign control household sector

0.5 84.2 4.0 11.4

0.3

85.6 4.3 9.8

0.2

85.5 4.3

10.0

0.2

85.6 4.7 9.4

0.3

86.3 5.2 8.1

8

2,156 131 203

Sources: Stavebnictví v roce 2001 - 2005, ČSÚ (Construstion in year 2001-2005), CZSO


121

V - 4 CONSTRUCTION

V - 4.2 OUTPUT BY SIZE AND TYPE OF FIRM

2001 2002 2003 2004 2005 bill. CZK, current prices 2004 = 100

T o t a l previous year = 100 of which firms with 19 or less 20 or more employees

295.7 113.8

78.0 217.7

311.2 105.2

84.9

226.3

346.8 111.4

97.5

249.3

394.3 113.8

125.3 269.0

422.737

132.065 290.672

107.2

105.4 108.1

bill. CZK, prices 2000 2000 = 100 T o t a l previous year = 100 of which firms with 19 or less 20 or more employees

283.8 109.6

74.9 208.9

290.9 102.5

79.4 211.5

317.0 108.9

88.0

225.1

347.5 109.7

110.6 236.9

362.138

113.215 248.923

104.2

102.3 105.1

Firms with percentage 19 or less 20 or more employees

18.6 81.4

19.6 80.4

19.5 80.5

29.4 70.6

31.3 68.7

Firms with percentage bill.CZK* 04=100 s 20 - 24 25 - 49 50 - 74 75 - 99 100 - 199 200 - 299 300 - 399 400 - 499 500 - 999 1000 or more employees

3.9 15.4 11.4

6.5 15.6

8.0 4.2 3.4 7.2

24.4

4.2 16.3 10.8

6.5 15.5

8.1 4.1 3.0 8.2

23.2

4.1 15.7 10.8

6.8 13.6

7.9 4.6 2.4 8.4

25.6

5.2 15.7

9.7 7.2

12.0 9.1 3.9 2.5 8.9

25.8

4.9 14.5

9.0 6.3

10.3 8.8 4.5 2.6

10.5 28.6

14.318 42.085 26.295 18.185 30.033 25.455 13.078 7.548 30.611 83.064

109.7 98.2 99.9 95.0 92.4

108.2 106.3 115.8 111.7 113.9

- non/financial public - non/financial private - under foreign control household sector

1.8 78.1 17.4

2.7

2.0 80.0 15.0

2.9

1.4 77.8 18.3 2.5

1.3 79.5 16.9 2.2

1.2 79.2 17.8

1.7

3.584 230.276 51.777 5.035

100.6 103.9 111.3 102.7

Notes: Indices at constant prices * at current prices Sources: Stavebnictví v roce 2001 - 2005, ČSÚ (Construction in year 2001-2005), CZSO


122

V - 4 CONSTRUCTION

V - 4.3 OUTPUT BY TYPE OF WORK 2001 2002 2003 2004 2005

Firms with 20 or more employees: bill. CZK, current prices 04=100 % Construction works by contracts

217.7

226.3

249.3

269.0

290.672

113.0

100.0

of which - abroad - inland

4.9

212.8

3.2

223.1

3.0

246.3

3.9

265.0

4.646

286.025

149.5 112.6

1.5

98.5

of inland works: - building - civil engineering - new + reconstr. + modernisation building civil engineering - repairs and maintenance building civil engineering

- other works

136.6

74.3

184.8 120.9

63.9

26.1 15.4 10.7

1.9

135.9

84.9

190.2 118.8

71.4

30.6 17.1 13.5

2.3

143.1 100.7

208.2 125.3

83.0

35.6 17.9 17.7

2.5

156.6 105.0

226.49 137.8

88.6

35.1 18.8 16.4

3.4

163.938 118.329

248.268 145.035 103.233

33.999 18.903 15.096

3.759

113.6 110.7

114.3 114.6 113.7

102.0 106.8

97.0

122.7

58.4 38.9

84.4 51.6 32.8

13.0

6.9 6.1

1.2

Output, excl. subcontractors

160.1

165.5

179.7

191.2

218.479

109.7

69.8

Note: Indices from volume of works in constant prices. Sources: Stavebnictví v roce 2001 - 2005, ČSÚ (Construction in year 2001-2005), CZSO


123

V - 4 CONSTRUCTION

V - 4.4 BUILDING PERMITS – ABSOLUT NUMBERS

Number (thousands) Tentative value ** Average project value * Number of dwellings Building permits total

2002 2003 2004 2005

140.8 149.3 153.6 142.9

142.2 286.2 315.1 325.8

1.720 1.917 2.051 2.279

35,097 38,927 39,944 41,628

Building permits for residential buildings 2002 2003 2004 2005

46.0 51.9 51.5 48.0

74.3 86.1 94.6 97.3

1.616 1.657 1.838 2.027

- - -

38,711 Building permits for non-residential buildings

2002 2003 2004 2005

29.0 28.4 29.4 25.7

90.2 96.8 99.4

108.6

3.109 3.409 3.378 4.232

- - -

2,917 Building permits for preservation of the environment constructions

2002 2003 2004 2005

36.2 36.4 36.1 33.7

24.5 26.0 25.0 28.4

0.678 0.714 0.693 0.844

- - - -

** Tentative value of permitted constructions in bill. CZK in current prices * Average value of permitted construction in mill. CZK in current prices

V - 4.5 BUILDING PERMITS – INDICES

Number Tentative value Average construction value previous y.= 100 % previous y.= 100 % previous y.= 100 total = 100

Building permits total 2002 2003 2004 2005

94.4 106.0 102.9

93.0

100.0 100.0 100.0 100.0

102.5 118.2 110.1 103.4

100.0 100.0 100.0 100.0

108.6 111.4 107.0 111.1

100.0 100.0 100.0 100.0

Building permits for residential buildings 2002 2003 2004 2005

101.4 113.0

99.1 91.0

32.6 34.8 33.5 33.6

118.7 115.9 109.9 102.8

30.7 30.1 30.0 29.9

116.9 102.5 110.9 110.3

94.0 86.4 89.6 88.9

Building permits for non-residential buildings 2002 2003 2004 2005

96.7 97.9

103.7 87.2

20.6 19.0 19.2 18.0

99.7 107.3 102.7 109.2

37.2 33.8 31.6 33.3

102.9 109.6

99.1 125.3

180.8 177.8 164.7 185.6

Building permits for preservation of the environment constructions 2002 2003 2004 2005

86.8 100.7

99.0 93.4

25.7 24.4 23.5 23.6

91.4 106.1

96.1 113.7

10.1 9.1 7.9 8.7

105.4 105.3

97.1 121.7

39.4 37.2 33.8 37.0

Sources: Přehled vydaných stavebních povolení v ČR v roce (2002 - 2005), ČSÚ (Review of granted building permits in CR in years (2002 - 2005), CZSO


124

V - 4 CONSTRUCTION

V - 4.6 ORDERS

Orders as at 31st December of year 2 0 0 4 2 0 0 5 bill.CZK % PS % bill.CZK index % PS % number ∅mill

New - residential buildings - non-resid., non-man. - non-resid., manufact. - civil engineering str. - water structures

193.3 22.1 33.4 12.1

122.5 3.3

91.0 10.4 15.7

5.7 57.7

1.5

77.1 37.9 61.4 21.4 93.6 90.3

185.8 25.6 38.0 15.4

103.8 2.9

96.1 116.3 113.9 127.5

84.7 89.22

90.4 12.5 18.5

7.5 50.5

1.4

68.5 20.6 56.9 13.9 92.1 89.2

11,7363,1342,355

9864,892

369

15,8278,180

16,14115, 61621,215

7,913Repairs + maintenance Other works

7.1 0.8

3.3 0.4

76.2 91.9

7.6 0.7

107.0 88.2

3.7 0.3

81.2 95.3

3,69349

2,05714,148

Inland works 201.2 91.0 77.1 194.0 96.4 94.5 69.1 15,478 12,536T o t a l 212.5 100.0 - 205.4 96.7 100.0 - 15,573 13,189 Notes: PS % = percentage of public sector in order volume in % index – same period of previous year = 100 ∅ mill. – average order value in mill. CZK at current prices - orders for construction works division 451 and 452 NACE Classification included - new orders includes also reconstructions and modernisation Source: Statistika stavebních zakázek v 4. čtvrtletí (2004 a 2005) (Statistics of construction orders in 4th quarter in (2004 and 2005), CZSO


125

V - 4 CONSTRUCTION

V - 4.7 EMPLOYEES – CURRENT STATE AND DEVELOPMENT

Employees Manual workers Firms with 20 or more employees 2004 2005 index 2004 2005 index

persons ‘04=100 persons ‘04=100 Average registered state 154,100 161,630 104.9 100,883 105,769 104.8 Firms: non-financial public non-financial private under foreign control Households

3,432127,997

16,9025,768

3,376134,171

17,5866,496

98.4 104.8 104.0 112.6

1,755 84,519

9,981 4,628

1,70588,31210,619

5,132

97.1 104.5 106.4 110.9

Private firms - total - unregistered in the Commercial Register - registered in the Commercial Register - Unlimited partnerships - Limited liability companies - Joint-sock companies - other

152,6745,3062,380

87783,49459,922

1,426

159,8675,9482,363

93889, 46860,338

1,763

104.7 112.1

99.3 106.9 107.2 100.7 123.6

- - - - - -

- - - - - -

- - - - - -

Firms with 20 - 24 employees 25 - 49 50 - 74 75 - 99 100 - 199 200 - 299 300 - 399 400 - 499 500 - 999 1000 or more

11,83134,26520,28212,707

22, 92911, 088

6,3723,807

11,37819,439

13,59636,77221,36913,168

23,0511,166,4163,890

11,73119,367

114.9 107.3 105.4 103.6 102.1 107.5 100.7 102.2 103.1

99.6

8,533 24,206 14,468

8,547 15,117

7,266 3,698 2,542 6,604 9,983

9,83325,89615,288

8,82815,320

7,7203,6982,5426,7989,847

115.2 107.0 105.7 103.3 101.3 106.2 101.3 101.3 102.9

98.6

V - 4.8 EMPLOYEES - PERCENTAGE

Employees Manual workers 2004 2005 2004 2005 D:Z ‘05

Average registered state 100.0 100.0 100.0 100.0 65.4 Firms: non-financial public non-financial private under foreign control Households

2.2 83.1 11.0

3.7

2.1 83.0 10.9

4.0

1.7 83.8

9.9 4.6

1.6 83.5 10.0

4.9

50.5 65.8 60.4 79.0

Private firms - total - unregistered in the Commercial Register - registered in the Commercial Register - Unlimited partnerships - Limited liability companies - Joint-sock companies - other

99.1 3.4 1.5 0.6

54.2 38.9

0.9

98.9 3.7 1.5 0.6

55.4 37.3

1.1

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

. Firms with 20 - 24 employees

25 - 49 50 - 74 75 - 99 100 - 199 200 - 299 300 - 399 400 - 499 500 - 999 1000 or more

7.7 22.2 13.2

8.2 14.9

7.2 4.1 2.5 7.4

12.6

8.4 22.8 13.2

8.1 14.5

7.4 4.0 2.4 7.3

12.0

8.5 24.0 14.3

8.5 15.0

7.2 3.7 2.5 6.5 9.9

9.3 24.5 14.5

8.3 14.5

7.3 3.5 2.4 6.4 9.3

72.3 70.4 71.5 67.0 65.5 64.8 57.6 65.3 57.9 50.8

Sources: Stavebnictví v roce 2005 (Construction in 2005), CZSO


126

V - 4 CONSTRUCTION

V - 4.9 MONTHLY WAGES AND LABOUR PRODUCTIVITY

Employees (E) Manual workers (W) Monthly wage, CZK Productivity, mill CZK. Monthly wage, CZK 2004 2005 index 2004 2005 index 2004 2005 index D : Z

T o t a l 18,233 18,923 103.8 1.537 1.540 100.2 14,923 15,300 102.5 80.9 Non-financial firms: - public - private - under foreign control Households

17,496 17,652 24,717 12,576

18,52118,30425,84913,154

105.9 103.7 104.6 104.6

0.890 1.484 2.346 0.731

0.911 1.471 2.510 0.666

102.3 99.1

107.0 91.2

16,066 14,749 17,362 12,397

16,676 15,127 17,674 12,901

103.8 102.6 101.8 104.1

90.0 82.6 68.4 98.1

Firms - private total - unregistered in Com. Reg. - registered in Com. Reg. - Unlimited partnerships - Limited liability comp. - Joint-sock companies Co-operatives Other

18,271 12,603 14,721 16,681 16,493 21,458 14,247 14,047

18,97713,13715,28217,12916,79922,99613,37314,720

103.9 104.2 103.8 102.7 101.9 107.2

93.9 104.8

. . . . . . . .

. . . . . . . .

. . . . . . . .

. . . . . . . .

. . . . . . . .

. . . . . . . .

. . . . . . . .

Firms with 20 – 24 employees 25 - 49 50 - 74 75 - 99 100 - 199 200 - 299 300 - 399 400 - 499 500 - 999 1000 or more employees

14,544 15,410 16,130 17,145 17,070 18,085 19,210 19,907 22,458 26,697

14,84515,66416,60017,51717,58018,56120,04120,23623,89229,692

102.1 101.7 102.9 102.2 103.0 102.6 104.3 101.7 106.4 111.2

0.948 1.076 1.115 1.296 1.220 1.814 1.654 1.465 2.041 3.207

0.905 0.984 1.058 1.188 1.104 1.827 1.746 1.659 2.212 3.665

95.4 91.5 94.8 91.7 90.5

100.7 105.5 113.3 108.4 114.3

13,398 13,860 14,295 14,701 14,650 14,627 16,158 16,664 17,134 18,176

13,650 14,022 14,735 14,994 14,976 15,243 16,688 16,411 18,108 19,259

101.9 101.2 103.1 102.0 102.2 104.2 103.3 98.5

105.7 106.0

92.0 98.5 88.8 85.6 85.2 82.1 83.3 81.1 75.8 64.9

Notes: Productivity of labour at constant prices 2000 W / E - percentage of manual workers wages from employees wages in 2005 (in %)

Sources: Stavebnictví v roce 2005 (Construction in 2005), CZSO


127

V - 4 CONSTRUCTION

V - 4.10 CONSTRUCTION WORKS PRICES

2001 2002 2003 2004 2005 Previous year = 100

T o t a l

104.0

102.7

102.2

103.7

103.0

Residential buildings Non-residential non-industrial buildings Non-residential industrial buildings Civil engineering Water structures

103.5 103.8 103.5 104.7 105.1

102.6 102.6 102.3 103.2 103.2

102.2 102.1 102.1 102.2 102.7

103.7 103.4 104.1 103.6 102.7

102.8 102.6 103.1 103.2 102.6

One or two-dwelling houses Multi-dwelling houses Industrial buildings and warehouses Commercial buildings Buildings for agricultural purposes Buildings for culture and education Buildings for health and social care Buildings for other purposes Bridges and elevated motorways Tunnels and undegr. struct. (mines excl.) Railways and suspended lines Long-distance lines - pipelines - for power and telecommunications Local lines - pipelines - for power and telecommunications - energetic other than power Tanks, surface sewage treatment plants Surface communications and grounds Water structures

102.6 103.3

103.8 103.7 103.9 103.5 103.3 104.0

103.8 103.5

. 104.7

.

. 104.4*

.

.

. 104.4 105.4 105.1

102.6 102.6

102.5 102.2 102.4 102.7 102.5 102.4

102.7 103.1 102.8

103.3 102.8

103.3 102.8 103.3 103.3

103.8-103.9 103.1-103.2

102.3 102.2

102.3 102.0 102.3 102.2 102.1 102.0

102.3 102.2 101.9

102.1 102.0

102.1 102.0 102.1 102.7

102.5-103.4 102.6-102.7

103.8 103.6

103.9 104.2 104.2 103.4 103.4 104.1

105.6 103.3 103.6

103.4 103.5

103.5 103.5

- -

103.2 -

103.0 102.8

103.1 103.1 103.1 102.6 102.6 103.4

104.1 102.9 103.2

103.4 103.1

103.3 103.1

102.9 102.6

Repairs and maintenance

103.8

102.6

102.2

-

102.8

Sources: Indexy cen stavebních prací a stavebních objektů za 4. čtvrtletí 2000 až 2005 (Indices of con-struction work prices in 4th quarter of 2000 to 2005), CZSO


128

V - 5 BUILDING MATERIALS

V - 5.1 MANUFACTURING OF SELECTED COMMODITIES (from manufacturers filling in statements Prům P 2-12)

unit 2004 2004/2003 2005 2005/2004 S e l e c t e d r a w m a t e r i a l s

Crushed aggregate Floated kaolin Natural sands Glass and foundry sand Gravel sands Limestone Terrazzo

thousands tons

28,846.8 901.3

2,079.5 15,703.4

6,726.9

106.3 130.8 105.6 102.6 106.3

30.324.9 1.019.0 2.701.4

15.643.1 7.023.6

105.1 113.1 129.9

99.6 104.4

S e l e c t e d p r o d u c t s Cement Burnt bricks Structure members Ganister Ceramic tiling - unglazed - glazed Roofing tiles - burnt - concrete Magnesite fireproof material Plaster Gypsum boards Concrete mixtures Dry plaster and mortar mixtures Fireclay Other fireproof materials Unshaped fireproof materials Lime hydrate Burnt lime Fibrocement products

thousandstons mill. unit

thousands m3

thousands tons thousands m2

thousands m2

thousands tons thousands tons thousands tons thousands tons thousands tons thousands tons thousands tons thousands tons thousands tons thousands tons thousands tons thousands tons thousands m2

3,828.7 1,378.8

681.3 8.7

8,567.0 24,083.6

204.4 1,650.6

34.9 144.5

38,697.7 12,226.8

1,420.1 26.1 67.0 82.0

180.0 1,084.3

14,984.6

109.3 104.5 124.2 103.6 123.2 101.8 106.6 102.8 107.1 112.6 120.5 105.1 119.2 108.3

84.1 131.4

92.5 102.8 126.5

3,978.1 1,449.9

699.9 8 .8

8,175.0 23,635.0

242.4 1,605.8

28.5 127.1

36,410.1

1,531.1 24.9 66.2 96.1

162.3 1,048.7

22,778.3

103.9 105.2 102.7 101.8

95.4 98.1

100.8 101.0

81.6 87.9 94.1

107.8

95.5 98.8

117.2 90.2 96.7

152.0

Sources: Vybrané obory průmyslu stavebních hmot v roce 2004, 2005 (Selected sectors of the building materials industry), ÚRS Praha, a.s., 2005, 2006


129

V - 5 BUILDING MATERIALS

V - 5.2 BUILDING MATERIALS PRODUCERS (Firms with 100 or more employees)

Number of firms Sales (mill. CZK) Sectors 2004 2005 2004 2005 index

Quarrying and preparation of aggregate Quarrying and preparation of sands, ...

2 16

2 12

- 7,920.6

- 6,637.9

- 83.8

Man. of fireproof ceramic products Man. of burnt masonry and roof. elements Man. of cements, lime, plaster - of which manufacture of cement Man. of concrete, gypsum ... products Man. of other mineral non-metal products

9 7 7 4

36 13

7 6 7 4

40 12

3,093.1 4,375.9

10,039.3 7,840.7

20,904.3 6,989.9

2,812.4 4,417.1

10,485.6 8,195.5

22,585.9 7,329.8

90.9 100.9 104.9 104.5 108.0 104.9

T o t a l 91 87 59,585.3 61,404.7 103.1

Number of employees Monthly wage (CZK) Productivity from VA * Sectors 2004 2005 index 2004 2005 index 2004 2005 index

Quarrying and prep.of aggregate Quarrying and prep. of sands, ...

- 3,032

-2,499

- 82.4

-20,755

-21,112

- 20,755

- 895.9

-859.7

-96.0

Man. of fireproof ceramic prod. Man. of burnt masonry and roof. Man. of cements, lime, plaster - of which man. of cement Man. of concrete, gypsum prod. Man. of other min.non-met. rod.

2,2761,9992,0341,4228,3133,203

2,064 1,746 1,975 1,369 8,785 3,087

90.787.397.196.3

105.796.4

17,92920,71230,46334,51020,89419,734

17,98121,91232,01635,65121,49320,599

17,929 20,712 30,463 34,510 20,894 19,734

587.1 1,137.5 2,543.4 3,019.0 865.3 707.5

560.21,231.92,705.63,242.8

877.0766.5

95.4108.3106.4107.4101.3108.3

T o t a l 24,299 24,008 98.8 21,355 22,234 21,355 961.2 974.4 101.4 * Labour productivity of value added (VA) in thousands of CZK

Sources: Vybrané obory průmyslu stavebních hmot v roce 2004, 2005 (Selected sectors of the building materials industry), ÚRS Praha, a.s., 2005, 2006


VI

TEXT APPENDIX

1. Brief summary of basic changes in legislative

2. Construction code

3. Partners and institutions in the construction process

4. Public procurement and license code

5. Health and safety and occupation hygiene

6. Preservation of the environment

7. Other legislation related to construction 8. Strategy of the sustainable development

9. Classification of economic activities and production

10. Technical standards and testing

The Czech Construction Industry 2006 VI – Appendix

133

VI – 1. BRIEF SUMMARY OF BASIC CHANGES IN LEGISLATIVE

The transformation of the economic and political system in the Czech Republic needs principal legislative transformation as well. Main legal amendments, in reference to the physical development and construction process, are oriented into the following issues:

- harmonisation of law in force and the Bill of Basic Human Rights and Freedom, - safeguarding of owner’s rights, incl. expropriation of real property in public

interest - harmonisation of the Czech law and the European law and - simplification and transparency of development control. - regulate the right and duties of subjects, including sanctions on statutory offence

Specific part of legislative changes and regulations are the changes which include the reform in state administrative system and related state administration bodies when the regions were created, in section of landscape planning and building regulations.

The basic legislative in section of construction is the Construction Code act No 50/1976 Coll. about landscape planning and construction regulations; consolidated version act No 109/2001 Coll. (amended by acts No 254/2001 Coll., 320/2002 Coll., 405/2002 Coll., 422/2002 Coll., 362/2003 Coll., 218/2004 Coll., 300/2004 Coll. and 437/2004 Coll.) and relating decrees No 132/1998 Coll. (amended by decree No 492/2002 Coll.), 137/1998 Coll., 135/2001 Coll. (amended by decree No 570/2002 Coll.) and 369/2001 Coll.

One of the main processes, influencing the capital construction, is public procurement which is regulated from May 1st of 2004 by the code No. 40/2004 Coll. about public procurements.

Public procurement was regulated by act No 199/1994 Coll. At December 17th 2003 new public procurement act (No 40/2004 Coll., amended by acts No 436/2004 Coll. and 437/2004 Coll.) was put in force. It respects rules of the European law and secures the harmony of the EC and the Czech law. It was renegotiated 8times till nowadays.

For details and for other relevant acts regulating the development control, e. g.

- act No 360/1992 Coll. on authorised professionals, - acts on geodetic activities, - act No 40/2004 Coll. on public procurement, - acts on the preservation of the environment etc. - new administrative regulations issued by act No. 500/2004 Coll. with

effectiveness from January 1st 2006.

The reform of the public administration system in 2003 (acts No 210/2002

Coll. and 320/2002 Coll.) reflects e. g. the transfer of competencies of professional departments from late district authorities to new regional or municipal authorities.


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In March 2006, a few key act were ratified by Parliament which define legal conditions for enterprising in sectors of constructions and public procurement. It is mainly:

- the act about landscape planning and construction regulations (Construction code) - the act about privation and limitations of owner’s rights in case of constructions

(The Expropriation act) - The public procurement act - The concession act

The new Construction Code will be in effect from January 1st of 2007. It’s main purposes are to create modern and democratic system of landscape planning and construction regulations respecting landscape conditions and needs and to ensure the sustainable development. It should simplify and accelerate processes in preparing of building and its permitting.

The new public procurement act was ratified in relation to new European legislative about public procurements (directive of EU 2004/17/ES and 004/18/ES ).

The concession act coordinates legal conditions in cooperation of public and private sector. It agrees with European direction 2004/18/ES.

The harmonisation of the Czech law and the European law is reflected e. g. by

acts regulating public procurement, value added tax or technical standards and testing.

Technical standards reflect harmonisation of Czech rules and standards with EC standards under Government agreement No 97/1993 Coll. (on principles of harmonisation). Introducing of EC technical standards is ruled by Government agreements from 1994, 1997 and 2003. The directive 89/106/EC is the principal document for unification. In 1997 the compatibility of the Czech and of the European standard systems was achieved (when 80 per cent of European standards were introduced into the Czech standard system) and the Czech Republic has joined (full membership) the European organisations for standardisation, CEN and CENELEC). The process of harmonisation is characterized by the following principles:

- state guaranty for formulation and publishing of standards (CSN) - standards (CSN) are formatted and published by an independent body authorized

by the state, - standards (CSN) are not obligatory, - harmonised standards are introduced progressively.

Harmonization of the Czech law and of the European law is reflected by the act

No. 22/1997 Coll. on technical requirements of products as well. It has been put in force since September 1997 and has:

- established an independent supervisory system and raises penalties, - arranged fixing of technical requirements of products, which could threaten health

or safety of persons, property or environment, - defined basic concepts, state attestation system and rules, certification,

notification or accreditation, - arranged conditions and rules for edition of standards, attestation of conformity,

duty to inform etc. - increased strongly financial sanction when the act is not kept.


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VI – 2 CONSTRUCTION CODE

VI – 2.1 CURRENT LEGISLATIVE

The physical development is regulated by the Construction Code, act No

50/1976 Coll. – consolidated version by act No 109/2001 Coll. and amendments by acts No 254/2001 Coll., 320/2002 Coll., 422/2002 Coll., 362/2003 Coll., 218/2004 Coll., 300/2004 Coll. and 437/2004 Coll., and by the following supporting decrees:

- No 135/2001 Coll., including detailed rules for the planning process and detailed items of planning documents (amended by decree No 570/2002 Coll.),

- No 132/1998 Coll., including details referring to the realisation of the Construction Code (e. g. building permits, permission for use, rules and conditions of the expropriation of the real estate etc.) or defining basic concepts etc., amended by decree No 492/2002 Coll.

- No 137/1998 Coll., including general technical rules and conditions, or decrees No 192/2002 Coll. and No 590/2002 Coll. including technical requirements of agricultural buildings and other structures or of hydraulic work,

- No 369/2001 Coll. – on special rules and conditions in reference to the use of some residential buildings, houses for special purpose, schools and some other buildings by handicapped people.

VI – 2.1.1 LANDSCAPE PLANNING

The main goal and task of landscape planning is complex solution of area and time coordination of construction and other works influencing the landscape development.

The basic principles of landscape planning are:

- area planning data – urban studies, area generals, technical data’s

- area planning documentation – landscape plans of large areas, landscape plans of towns and regulations

- area planning permissions.

Planning authorities are communities, regions, Ministry for regional development and Ministry of defence.

VI – 2.1.2 CONSTRUCTION REGULATIONS

The construction and its changes can be made only by business or individual persons authorized for construction works.

Simple buildings and its changes can be made by the builder itself in cooperation with authorized person as a quality surveyor.

The buildings, its changes and maintenance can be made only according to building permits or announcement to local authorities.


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VI – 2.1.21 Building permits and announcement to building control department

Building permits lay down binding conditions for implementation of

construction projects and the use of buildings or other structures, and they are to ensure the conformity of designed buildings or other structures with

- rules and conditions given by the Construction Code, - principles of the master plan of the respective region, or - rules and conditions given by local authorities.

From this point of view there are three types of projects, in reference to the size

and complexity of projects: - projects, for which building permits are necessary, - projects, for which notice is sufficient (small construction work, small adaptation

etc.), - projects, for which neither permit nor notice is required (e. g. movable facilities,

wooden movable survey towers, vineyards and hop-gardens, small maintenance work etc.) – see the CC.

Businesses or individuals (owners of designed work) submit applications for

building permits to local authorities. Application must prove the ownership to the ground or the right to erect building or other structure on the land owned by another person. Application comprises description of designed construction work and information relating to the proposed date of its completion, identification number of respective ground, type of neighbouring grounds and names of neighbours. Next to these applications the following documents are necessary:

- approvals of local authorities referring to the following issues: preservation of the environment, fire safety, hygiene regulations etc.; this approval is requested before the permit is granted,

- planning documents and drawings of the designed work.

Building permit is valid for next two years.

The announcement to building control department can be made in case of small constructions, repairs and changes which do not influence the design of building, load-bearing parts of building and do not change the use of building.

The cases when no permit or announcement is necessary are given by law.

VI – 2.1.22 Permission to use

The finished building which needed the building permit can be use only after given permission to use. The permission to use is issued by local authority (which issued the building permit).

The permission to use is issued after the permission administration. Its participants are the builder, the owner of building, the user and the owner of land. In permission of use can be given the conditions of using, shortages in building construction found by local examination.


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VI – 2.1.23 The maintenance and removing of buildings

The maintenance of buildings and other structures in proper state is compulsory for their owners. Dilapidated buildings or structures, dangerous for use, may be demolished by order of authorities.

VI – 2.1.3 Building control department and state building supervision Building control department is:

- municipal authorities, - regional authorities, - Municipality of the capital Prague,

The towns which are not building control department, control whole construction works in town to correspond with landscape planning. They control building, its changes, terrain corrections and works if they are done with building permit. They can decide to stop construction.

For special constructions as aerial, railways, water buildings and so on, there are special building control departments.

The protection of public right is ensured by state building supervision.


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VI – 2.2 NEW CONSTRUCTION CODE

The new act about landscape planning and construction regulations (Construction code) was ratified by Czech Parliament in March 14th 2006, together with changes of few act corresponding with construction code. The validity will be from January 1st of 2007. The changes of current code in case of expropriations will be valid from July 1st 2006.

VI – 2.2.1 Basic principles

Basic principles conditioning the efficiency of process of public administration (mentioned mainly in § 4), are mainly:

a) The duty of authorities in landscape planning and building control departments to make use of simplifying processes. It is possible in by law given cases to join landscape and building process (§ 78 art. 1).

b) So called touched authorities, protecting public interest will not lead their own administrative processes.

c) The principle of continuity of view-points – touched authorities are bound to their view-point issued in previous parts of process. Next (changed) viewpoints can be applied only based on newly found out and documented facts.

d) Issuing the coordinated viewpoint – touched authorities of public administrative issue the coordinated viewpoints which involve requirements for preservation of all public interests which protect.

e) The authorities can make a contract governed by public law instead of issuing the administrative viewpoint.

VI – 2.2.2 Landscape planning On part of landscape planning the act establish these main changes:

1. Strong differentiation of processes in deciding about area depending on if it is built-up or non built-up area (with protection of non built-up area)

2. The enlargement of participation of public in processes in landscape planning including landscape process.

3. Creating of landscape analytical documents on municipality level. It will be public system which will offer needful data to administrative bodies and investors.

4. The policy of landscape development gives the priorities in inland and also international context.

5. The Act set the conditions of landscape process according to complexity and importance of construction and conditions of area:

- regulative plan,


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- whole landscape process with landscape viewpoint - simplified landscape process - area agreement (according to § 96) – for non-conflict cases

6. The new institute is set up – landscape planning information, which is issued by municipalities, the office of landscape planning, regional office and building control departments. They informs about conditions of using of area, its changes, issuing of regulations plan and so on. Their validity is 1 year from date of issuing.

VI – 2.2.3 Building regulations

1. It spread the range of buildings which will not need the building permit or announcement.

2. Strongly increase the range of simple buildings which can be only announced to local building control department and the agreement can be written or in silence – by expiration of 40 days time-limit. It is e.g. buildings as dwellings or for recreation up to 150 m2 built-in area, with one underground level down to 3 meters and maximally two above-ground levels and attic.

3. The building process is limited to setting of technical conditions for construction.

4. The simplified building process can be used by using the services of authorized inspector. If the builder make a contract with authorized inspector about control of project documentation, this construction can be only announced to building control department.

5. Finished building can be used based on:

- announcement to building control department together with documentation of real fulfilment 30 days before real building usage.

- building inspection

VI – 2.2.4. Others Expropriation and substitutes

The Act defines some reasons for which a land or buildings can be expropriated. Those reasons are mainly public works – traffic and technical infrastructure, public building, buildings for ensuring the defence and security of state and cases of regeneration of areas. The process of expropriation is defined directly in the individual Act.

The statement § 101 sets up the right of refusal to towns, regions and state in cases and conditions given by the law.

A compensation belongs to the owner of land or building whose rights to use were reduced.


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Authorization to issuing of implementary regulations

The implementary regulations (their issuing is expecting in second half o year 2006) will be set up mainly for:

- the content of building documentation

- the content and way of leading the building notes

- technical requirements on buildings and facilities including general technical requirements for buildings used by handicap persons

- some propositions to authorized inspectors VI – 2.2.5 Building control departments, state supervision in landscape

planning and activity of the Ministry for regional development

Building control departments are divided to:

a) general, which are: - the Ministry for regional development, it is the central authority for building

regulations - regional authority, - Municipality of Prague, - Municipalities of towns

b) special – according to special legal norms for buildings: - aerial, railways and buildings belonging; highways, local roads and public roads, - water structures, - the building which need integrated building permit according to Act No.76/2002.

c) military and other - The Ministry of defence, - the Ministry of Internal Affairs (building for state security), - the Ministry of Justice, - the Ministry of industry and Trade (building for quarrying, processing, transport

and storing of radioactive raw materials and nuclear works.

The activity of the Ministry of regional development The ministry is central administrative authority in landscape planning and

executes the state supervision in landscape planning and provides the policy in area development including the area planning data.

The ministry is central administrative authority for building regulation and mainly:

- executes state supervision on building regulations - observes and analyzes serious and repeated mistakes in construction and propose

arrangements


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- observes the effectively of technical rules for buildings, proposes modifications of requirements on buildings

- supervises the work of authorized inspectors

Building supervision and special rights of building control department

Building control departments execute systematic supervision on protecting public interest and protecting the rights of individuals and business persons. Specification of public interest is defined in Construction code in § 141 par. 3. In public interest the building control department is allowed to: a) do control inspections of buildings b) direct the urgent removing of building or direct the necessary safety works (§ 135); c) direct necessary modifications on construction, on building land or built-up land (§

137); d) direct the maintenance works (§ 139); e) direct the building clearance (§ 140); f) place the arrangements on neighbouring land or building (§ 141).

VI – 2.2.6 Change act

The act about changes of some acts related to ratifying of Construction code and Expropriation act was ratified by Czech Parliament on March 14th of 2006. For implementation of new Construction code it novelizes 51 related acts.

VI – 2.3 EXPROPRIATION OF REAL PROPERTY

VI - 2.3.1 – According to Act No. 50/1976 Coll. The land, buildings and rights to them can be limited or expropriated in cases given by law. Expropriation can be done only in public interest and the reason has to be proved in expropriation process. By expropriation all rights to land and buildings comes to proposer and all other rights to those land and buildings expires.

Expropriation can be done only if the expropriated object cannot be reached by agreement or other way and only in necessary range and according to goals of landscape planning. The compensation is done in money, if it is not said other way.

VI - 2.3.2 – According to new expropriation act New act about expropriation or limitation of owner’s rights to land and building was ratified by Czech Parliament together with new Construction code.


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Expropriation is possible only if public interest prevails the rights of expropriated. Expropriation is not allowable if those rights can be reached by other way.

Compensation will be in height of usually price of land or building (rated by expert´s report). Other land or building can be afforded.

The expropriation process is executed by expropriated authorities which are municipalities. The participants of process are the owner, the proposer and other persons stated in § 17 of the act.


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VI – 3 PARTNERS AND INSTITUTIONS IN THE

CONSTRUCTION PROCESS

VI – 3.1 AUTHORIZED PROFESSIONS IN CONSTRUCTION

Under the Construction Code a special qualification must be proved by those that want to undertake selected professional activities, e. g. planning, geodetic activities, stress analysis, dynamic designs, designing, management of construction work on site, testing of structures etc. This qualification is approved by “authorisation“.

Under act No 360/1992 Coll. (Authorised Professionals Act), amended by acts No 164/1993 Coll., 275/1994 Coll. and 224/2003 Coll.:

- authorised architects, - authorised engineers and - authorised technicians

are professionals authorised to activities mentioned above.

Authorised architects are entitled: - to undertake planning, documents, master plans and detailed drawings (but civil

engineering structures), architectural or urban research and geodetic activities, - to take part in undertaking of civil engineering work, undertook by authorised

engineers, - to manage the realisation of simple projects on site, - to supervise and check the implementation of construction projects, - to be the client’s representative etc.

Authorised architects are registered by the Česká komora architektů (ČKA, the

Czech Chamber of Architects) and are authorised to do business in the following sectors: buildings, planning, interiors, garden or landscape formation.

Authorised engineers are entitled: - to undertake designs (but sophisticated architectural or urban projects), planning

documents and relevant parts of master plans, stress analysis, dynamic designs, geodetic activities and technical research,

- to co-operate with architects when elaborating sophisticated architectural or urban projects,

- to manage or supervise the implementation of construction projects on site, - to be client’s representative etc.

Authorised technicians are entitled:

- to take part in elaboration of planning documents of authorised architects or engineers,

- to undertake technical research, - to manage or supervise the implementation of construction projects or relevant

construction works on site, - to represent clients in selected cases etc.


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Authorised engineers or technicians are registered by the Česká komora

autorizovaných inženýrů a techniků činných ve výstavbě (ČKAIT, the Czech Chamber of Authorised Engineers and Technicians Involved in Construction). They are authorised to do business in the following sectors: buildings, transport infrastructure, water works, bridges and civil engineering works, technological facilities of buildings, built environment, stress analysis and dynamic designs, urban engineering, geotechnics, testing and diagnostics, fire safety and energy audits.

ČKA and ČKAIT are independent professional organisations.

For authorisation the following conditions are required:

- citizenship of the Czech Republic and residence in the Czech Republic (for details see act No 224/2003 Coll.),

- ability to rights and liabilities, - professional experience, - professional qualification (both architects and engineers must hold a technical

university degree, technicians must have passed a professional secondary school or hold a technical university degree),

- professional swear.

VI – 3.2 PARTICIPANTS OF CONSTRUCTION PROCESS

current conditions There are public or private sector clients. Public sector clients, i. e. contracting authorities, shall be ministries, administrative offices, regional or local authorities or other bodies – for details see the Public procurement act No 40/2004 Coll. Their role is controlled by regulations given for public procurement procedures. Private sector clients may by business companies, developers or any other businesses or individuals investing in construction projects. There are few constraints given on private clients in the Czech Republic.

Clients apply for building permits and permissions for use. Clients usually are owners of the new created construction work. Under the Construction Code, the Trade Licensing Act and Authorised Professionals Act special qualification for designers is required. This qualification is awarded to individuals, that are authorised under conditions given by act No 360/1992 Coll. only. Businesses, e. g. design bureaus etc., must either employ authorised professionals or must be entities owned by such professionals. Contractors may be both businesses or individuals. Under Trade Licensing Act and act No 286/1995 Coll., special qualification is required in dependence upon the type of construction work realised. This qualification is awarded only to individuals authorised under conditions given by Authorised Professionals Act; businesses must employ authorised professionals or must by owned by authorised professionals.


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VI – 3.3 PARTICIPANTS OF CONSTRUCTION PROCESS – NEW CONDITIONS

New Construction code brings some changes with validity from 1.1. 2007:

Newly define definitions: - construction enterprises = person authorized to construction works - builder = person which demands issuing of building permit or gives the building

announcement; person which does the construction; the builder can be also the investor

- building supervision = professional supervision on building construction In construction code, there are defined duties of builder (§ 152), site manager (§ 153) and the owner of construction (§ 154). Also there is given the responsibility of designer for elaboration of building documentation, area studies and documentation for area decision.

VI – 3.4 GEODETIC ACTIVITIES Geodetic activities (methods for research, design, development or erection purposes and for use of structures and technical facilities) are defined by act No 200/1994 Coll. (consolidated by act No 289/2001 Coll., amended by Act No 319/2004 Coll.) and supporting decree 31/1995 Coll., amended by decrees No 212/1995 Coll. and 365/2001 Coll. Special kind of authorisation is required for geodetic activities: authorised architects or engineers are entitled to do some of them. Surveyors authorised by the “Český úřad zeměměřičský a katastrální“ are entitled to surveying only. Act No 62/1958 Coll. is another basic legal rule in this respect, next to act No 200/1994 Coll. For transfer of competencies from late district authorities to regional or municipal authorities see act No 320/2002 Coll. Next to acts mentioned above, the following acts are important in this respect: - act No 284/1991 Coll. (consolidated version by act No 218/1997 Coll., amended by act No 120/2000 Coll.; supporting decree No 4/2000 Coll. Last amendments are included in: - act No 139/2002 Coll. (on ownership to real estate and agricultural land) and decree No 545/2002 Coll.

VI – 3.5 CADASTRAL AREA AND AUTHORITIES AND REAL ESTATE CADASTRE


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Under act No 359/1992 Coll. on land surveying and cadastre authorities

(consolidated version by act No 11/2004 Coll., amended by act No 499/2004 Coll.) the following authorities have been established:

- Český úřad zeměměřický a kartografický (the Czech Land Surveying and Cartographic Office) – the supreme authority in this respect, controlling

- Zeměměřický úřad (Land Surveying Office), - katastrální inspektoráty (cadastre inspectorates), and - katastrální úřady (cadastre offices).

Cadastre areas have been fixed by decree of the Ministry of agriculture No

380/2004 Coll. (or decree No 463/2002 Coll., amended by decree No 387/2003 Coll.), including the list of areas and related mean basic prices of agricultural land.

* * *

The cadastre is a public document – for details see:

- act No 344/1992 Coll., consolidated version by act No 172/2000 Coll. and its amendments by acts 220/2000 Coll. and 53/2004 Coll., - act No 265/1992 Coll., amended by acts No 210/1993 Coll., 90/1996 Coll., 27/2000 Coll., 30/2000 Coll. and 120/2001 Coll. (supporting decree No 190/1996 Coll. and its amendments.

The cadastre includes basic information referring to all real properties, e. g. burdens referring to the respective property or other rights referring to, the type of land (ground), its location and way of use, its cadastre number, the type and way of use of the respective building, its identification number, identification indicators of flats or dwellings or on non-residential spaces etc.

Different types of entries or notes are put in the cadastre. Compulsory entries approve the right to the real property and an approval of authorities is necessary in case of transfer of ownership rights. Abstracts of the register are available under conditions given by decree No 162/2001 Coll.


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VI – 4 PUBLIC PROCUREMENT

VI. – 4.1 CURRENT LEGISLATIVE

The process of public procurement procedures, i. e. co-ordination of procedures for awarding of public works or supplies contracts, in regulated by act No 40/2004 Coll., amended by acts No 436/2004 Coll., 437/2004 Coll. and No 60/2005 Coll. It respects legal rules of the European Communities and secures the harmony of the European law and the Czech law. The Public Procurement Act comprises: - general provisions, - common advertising rules, - common rules on participation, - criteria for qualitative selection, - criteria for award of contracts, - final provisions. Contraction authorities must award their contracts by procedures applied under rules laid down by the act, i. e. - open procedure, - restricted procedure, for which tenderers must prove fulfilment of given criteria, - negotiated procedure, with or without advertising. Provisions of the Public Procurement Act shall apply to contracts exceeding the minimum limited value, in dependence on the type of contracting authority: - public authorities, - other contracting authorities of projects funded by public authorities, - entrepreneurs controlled by public authorities. Contracting authorities shall make known essential characteristics of the contracts with they intend to award by means of an indicative notice in the “Obchodní věstník“ (Commercial Journal, weekly). Common rules of procedures, e. g. time limits for tenderers (i. e. final date for receipt of tenders etc.), the address to which they must be sent, time limits for presentation of contract documents, etc., must be comprised in the notice. Contracts should be awarded to the “best offer“ under terms and conditions given in the notice: lowest tender price or lowest tender price and other terms and conditions, e. g. operating costs, maintenance costs, ecological issues etc. All tenderers must be informed of the result in proper time by means of the information system of the Ministry for Regional Development and in the Official Journal EC in selected cases as well. No tenderers may be discriminated against, whether Czech of foreigner.


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Procedures of the public procurement are supervised by the “Úřad pro ochranu hospodářské soutěže“ (Office for the Economic Competition Protection).

VI. – 4.2 NEW PUBLIC PROCUREMENT ACT On March 14th of 2006, the Czech Parliament ratified new act about public

procurement. It will be valid from July 1st of 2006. Basic changes compared to last act will be mentioned here from viewpoint of construction works and services related to construction industry.

This legal act applies 2 new directives of European parliament and Council of

Europe (2004/17/ES and 2004/18/ES) which substituted last 4 directives. They were basis for act No. 40/2004 Coll., about public procurement. New legal modification is detailed and clear and same time it kept same conception and procedures of last version, if it correspond to new directives and practise.

The act modifies: - the procedures in public procurement, - project competition, - supervising keeping the act;

The submitters are divided to categories to: - public – same as in last version of act; - subsidised – according to European directives defined for person which set the

above-limited public contracts for construction works and above-limited services related with these works if they are reimbursed from more than 50% of public submitter;

- sector – persons making so called relevant actions according to § 4 of act. - central – from position of public submitter it set centralized assignment for other

submitter or on their account According to expecting value the public procurements divides to: a) above-limit – expected value (corresponding to EU limits), construction works

from 165.288 thousands CZK. b) under-limit – construction works started with 6 mill.CZK, distributions and

services from 2 mill. CZK; c) small range – the submitter need not set the public procurement according to act,

it has to keep only basic principles (transparency, equal treatment, prohibition of discrimination)

By the act, there are 6 types of procurement process. To current 4 types ( open process, closer cooperation, negotiation with publication, negotiation without publication) two more types were added:

- competition dialog - for more difficult solutions,

- simplified under-limited process – for at least 5 applicants, expected value does not reach 20 mill. CZK (without added value tax).


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The method of limiting the number of applicants is newly solved by objective

criteria, by random choice by ticket or by combination of both.

The contractual documents is defined as a set of documents, data’s, requirements and technical conditions from submitter, specifying the subject of public procurement (PP) in details necessary for preparing the offer.

VI. – 4.3 CONCESSION ACT

The concession act was ratified by Czech Parliament in March 14th of 2006. It gives the basic legal conditions for cooperation of public and private sector

(Public Private Partnership-PPP) for realisation of project by concession contract. It implement the EU directives 2004/18/ES.

The concession act set up the conditions and process of public submitter in making the concession contracts.

The public submitter is defined in this act same as the definition of public submitter in the Procurement act.

Concession process proceeds in form of: - negotiation about offers - concession dialogue.

The choice of concessionaire is done by criteria of economical advantage of offers.

The publicity is done by information system about public commission and in Official reports EU (for above-limited concession contracts). The Ministry of regional development assures the control of index of concession contracts which is public.


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VI – 5 HYGIENE, HEALTH AND SAFETY AT WORK

VI – 5.1 HEALTH AND SAFETY AT WORK

The right to safety is guaranteed by the whole legal system of the Czech Republic, particularly by the following acts and decrees: Labour Code, act No 65/1965 Coll. (consolidated version by act No 85/2001 Coll., amended by acts No 177/2001 Coll., 6/2002 Coll., 136/2002 Coll., 309/2002 Coll., 311/2002 Coll., 312/2002 Coll., 274/2003 Coll., 362/2003 Coll., 46/2004 Coll., 436/2004 Coll., 562/2004 Coll., 563/2004 Coll. and 628/2004 Coll.; supporting decree No 108/1994 Coll., amended by decrees No 461/2000 Coll., 342/2004 Coll. and 516/2004 Coll. Basic duties of employers are included in §§ 35, 132, 133, 170, 171, etc, basic duties of employees are included in §§ 73, 74, 135, 170, 171 etc. State Supervision on Safety Act No 174/1968 Coll., consolidated version by act No 396/1992 Coll., amended by acts No 47/1994 Coll., 71/2000 Coll., 124/2000 Coll., 151/2002 Coll., 309/2002 Coll., 320/2002 Coll., 362/2003 Coll. and 436/2004 Coll. Health Care Act No 20/1966 Coll.; consolidated version by act No 86/1992 Coll. and later amendments, and the decree No 178/2001 Coll., amended by decrees No 523/2002 Coll. and 441/2004 Coll. Decree of the “Czech mining office“ No 324/1990 Coll., on safety in the construction process, and the Government decree No 378/2001 Coll., on safe use of machines and technical equipment, apparatuses and tools. Act No 258/2000 Coll., on public health protection, and act No 274/2003 Coll. and its amendments.

VI – 5.2 PRESERVATION OF HEALTH, HEALTHY LIVING CONDITIONS AND ENVIRONMENT, USING OF BULDING

BY HANDICAP PERSONS

All buildings or other structures should be safe for users and for users of buildings and other structures in the neighbourhood and should not exceed the limits of preservation of the environment. Basic limits are laid down by relevant rules, e. g. minimum level of the ground floor above the ground or subsoil water, clearance height of rooms, limits of sanitary facilities etc. By decree No 6/2003 Coll. hygienic limits of chemical, physical or biological indicators are laid down for schools, buildings for recreation, health or social care, hotels, shopping etc.


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Special rules and conditions are comprised in decrees No 137/1998 Coll., on general technical rules and conditions, and No 369/2001 Coll., on conditions for the use of residential buildings by handicapped people).


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VI – 6 PRESERVATION OF ENVIRONMENT

Preservation of the environment comprises preservation of clean air, preservation of clean water, wastes, preservation of nature and of biodiversity, restriction of noise and vibration, protection against radiation, research and development of issues mentioned above and other activities for reservation of the environment, e. g. protection against floods, education in the preservation of the environment etc.

* * *

General duties in preservation of environment in connections with construction are given by conditions in area and building administration given by construction code and its supporting decrees.

Basic legal acts in environment preservations are: - Act No. 17/1992 Coll., about environment, in acts No. 123/1998 Coll. and No.

100/2001 Coll. - Act No. 100/2001 Coll., environmental impact assessment (EIA) and its

supporting acts No. 93/2004 Coll. - Act No. 123/1998 Coll., about the right for information about environment, in

acts No. 132/2000 Coll., No. 6/2005 Coll. and No. 413/2005 Coll.

The main legal act in this area is the Act No. 76/2002 Coll., about integrated prevention and limiting the pollution, about register of pollutions and about changes in some acts No. 521/2002 Coll., No. 437/2004 Coll., No. 695/2004 Coll. and No. 444/2005 Coll.

VI – 6.1 WATER MANAGEMENT AND WATER PRESERVATION

Basic acts and decrees regulating preservation of clean water: - Water Act No 254/2001 Coll., amended by acts No 76/2002 Coll., 320/2002 Coll., 274/2003 Coll. and 20/2004 Coll., - government decree No 61/2003 Coll. (on limit values of indicators of contamination of surface and waste water), - decree No 191/2002 Coll. (on technical requirements of agricultural structures) - decree No 590/2002 Coll., (on technical requirements of hydraulic works) Competent authorities: local, district and regional authorities, Česká inspekce životního prostředí (the Czech Inspection of the Environment), the Ministry of the Environment, The Ministry of Industry and Trade and the Ministry of Agriculture.


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VI – 6.2 AIR PRESERVATION Basic act and decree: - Preservation of Clean Air Act No 86/2002 Coll., amended by acts No 521/2002 Coll., 92/2004 Coll., 186/2004 Coll. and 695/2004 Coll. - Government decree No 350/2002 Coll., on pollution limits, amended by decree No 60/2004 Coll. Competent authorities: local, district and regional authorities, the Czech Inspection of the Environment, the Ministry of the Environment.

VI – 6.3 WASTE MANAGEMENT Basic acts and decrees: - act No 185/2001 Coll., on wastes, amended by acts No 477/2001 Coll., 275/2002 Coll., 320/2002 Coll., 356/2003 Coll., 167/2004 Coll., 188/2004 Coll. and 317/2004 Coll., - decree of the Ministry of the Environment No 381/2001 Coll., amended by decree No 503/2004 Coll., including Catalogue of wastes, and acts and decrees referring to package: - act No 477/2001 Coll., on package, - decree No 184/2002 Coll., on compulsory package withdrawal.

VI – 6.4 PRESERVATION OF NATURE Basic acts and decrees: - act No 114/1992 Coll., on the preservation of nature and land, consolidated version by act No 460/2004 Coll., - supporting decree of the Ministry of the Preservation of the Environment No 395/1992 Coll., amended by decrees No 190/2000 Coll., 116/2004 Coll., 381/2004 Coll., 573/2004 Coll. and 574/2004 Coll.

VI – 6.5 PRESERVATION OF AGRICULTURAL LAND AND FORESTS

Basic acts and decrees: - act No 334/1992 Coll., on the preservation of agricultural land, consolidated by acts No 132/2000 Coll., 76/2002 Coll. and 320/2002 Coll., - Forest Act No 289/1995 Coll., amended by acts No 238/1999 Coll., 67/2000 Coll., 132/2000 Coll., 76/2002 Coll., 320/2002 Coll. and 149/2003 Coll., - decree of the Ministry of Agriculture No 433/2001 Coll., on technical requirements of forestry structures, - decree of the Ministry of Agriculture No 191/2002 Coll., on technical requirements of agricultural structures.


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For non-agricultural purposes non-agricultural land is to be used. Competent authority: Preservation of the Agricultural Land Fund.

VI – 6.6 PRESERVATION OF MINERAL RESOURCES Basic act No 44/1988 Coll., (Mining Act), consolidated by act No 439/1992 Coll. Competent supreme authorities for supervision and inspection on mineral resources are Ministry of the environment (the preservation of the raw stock of mineral resources and of ecology) and Ministry of the Regional Development (utilisation of mineral resources and geological research).


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VI - 7 OTHER LEGAL ACTS RELATED TO CONSTRUCTION

With preparation and realization of constructions it relates a range of other legal acts. WE can mention especially:

- Act No. 274/2001 Coll., about water and drainage systems for public use

- Act No. 151/2000 Coll., about telecommunications

- Act No. 266/1997 Coll., about railways

- Act No. 13/1997 Coll., about ground communications

- Act No. 49/1997 Coll., about civil aviation

- Act č. 114/1995 Coll., about inland navigation

- Act No. 406/2000 Coll., about energy management

- Act No. 458/2000 Coll., about conditions in business and state administration in energy sector

- Act No. 18/1997 Coll., about peaceful using of nuclear energy

- Act No. 20/1987 Coll., about state monument preservation

- Act No. 164/2001 Coll., about natural healing springs, sources of natural mineral water, natural healing spas and spa places

- Act No. 258/2000 Coll., about preservation of public health

- Act No. 133/1985 Coll., about fire prevention

- Act No. 239/2000 Coll., about integrated emergency system

- Act No. 455/1991 Coll., The Trades Licensing Act

Main regulation related to constructions is also Act No. 500/2004 Coll.,

administrative regulations with validity since January 1st of 2006. It regulate the processes of executive bodies, municipalities and other bodies and persons in public administration. Relation to constructions is mainly in communications in administrative, issuing the permissions, making public contracts and so on.


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VI - 8 STRATEGY OF THE SUSTAINABLE DEVELOPMENT

In 2004 The Czech Government approved the strategy of sustainable development reflecting both the principles of the strategy of the sustainable development of UNO (definition of the environment and development from 1987), OECD or EU and specific needs of the Czech Republic. The development of the human society is sustainable if it fulfils needs of the present society and without threatening the needs of future population. There are tree main pillars of the sustainable development, social, economic and environmental, and the summit in Johannesburg in 2002 pointed out the necessary balance of them. It is necessary to fulfil the tree main goals:

- social development, respecting the needs of all people, - high and stable level of economic development and employment and - efficient preservation of the environment and natural sources.

Both strategic a partial goals, tasks and tools of the Strategy of the sustainable

development of the Czech Republic shall secure the balance of these tree pillars. Strategic goals shall secure the highest possible quality of life of the present population and create assumptions for high quality life of future population as well. The strategic goals are as follows:

- to secure the economic stability and resistance to all negative factors, - to support the economic development respecting the capacity of the environment

and securing sustainable economy, - to secure the competitiveness of industry, agriculture and services, - to secure good quality of all elements or components of the environment in the

Czech Republic and to secure harmonised relations of ecosystems, national fortune and biological diversity,

- to reduce encounters of economic activities and preservation of the environment, - to take part of solving global problems of sustainability, - to keep the stable population of the Czech Republic and to make the pattern by

age more positive, - to create condition for lasting decrease of unemployment reflecting the economic

and social motivation to be active from the economic point of view, - to support development of human resources and to achieve maximum social

coherence, - to secure increasing culture for securing of the competitiveness of the Czech

society, - to develop ethic values reflecting European culture traditions, - to protect and promote Czech national interests, - to fulfil Czech international obligations in the sphere of sustainability.


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VI – 9 CLASSIFICATIONS OF ECONOMIC ACTIVITIES AND PRODUCTS

VI –9.1 CLASSIFICATION OF ECONOMIC ACTIVITIES

(OKEČ/NACE) “Odvětvová klasifikace ekonomických činnosti“ (OKEČ – “the Classification of Economic Activities“) has been introduced by the Czech Statistical Office since November 1st, 1991 (1st edition). The last, complete edition of OKEČ has been introduced since January 1st, 2003. It is the basic classification of all activities of businesses or individuals. It reflects new economic conditions given by the transformation and restoration of market economy in the Czech Republic since 1990 and respects the classification of European Communities NACE (Nomenclarure des Activités établies dans les Communautés Européennes) and other relevant international standards and good praxis, EC or UNO statistic classifications etc. Two classification keys are used. • alphabetic: X categories XX subcategories

There are 17 categories: A Agriculture, forestry, hunting B Fishing and similar activities C Mining of mineral raw-materials D Manufacturing E Production and supply of electricity, gas and water F Construction G Trade, repairs of motor vehicles and household goods H Hotels and restaurants I Transport, warehousing, posts and telecommunications J Financial intermediation K Real estate, renting, business services, research and development L Public administration, defence, social care M Education N Health care, veterinary care and social services O Other public, social and personal services P Households with employees Q Exterritorial organisations and associations

• numerical: XX divisions (there are 60 divisions) X subdivisions (there are 250 subdivisions) X groups X subgroups

* * *


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Construction work, category F = division 45 of the OKEČ Classification: 45.1 Site preparation 45.2 Building of complete constructions or parts thereof; civil engineering 45.3 Building installation 45.4 Building completion 45.5 Renting of construction of demolition equipment with operator

VI – 9.2 STANDARD CLASSIFICATION OF PRODUCTS (SKP)

Goods, incl. imported, are classified by means of this classification, incl. by-products, industrial or agricultural wastes and other secondary raw-materials, parts of industrial products and accessories, production of new products and services (repairs, maintenance, reconstruction, modernisation, dismantling, installation or finishing). It reflects European standard CPA (Classification of Products by Activities). It was established by the Czech Statistic Office and replaced five “uniform classifications“ of products, types of construction etc. The 2nd edition of SKP has been established since January 1st, 2003 (published in No 198/2002 Coll.). Two classification keys are used: • alphabetic: X sections XX subsections • numerical: XX divisions X groups X classes (approx. classes of OKEČ classification) X categories X subcategories Classification has 17 sections, 16 subsections and 62 divisions. Class SKP corresponds usually to class OKEČ. there is also the relation of SKP to OSN-ISIC rev.3.

* * *

Construction work, groups and classes

45 Construction work 45.1 Site preparation work


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45.2 Works for complete construction of per there of; civil engineering work 45.3 Building installation work 45.4 Building completion work 45.5 Renting services of construction or demolition equipment with operator Classification of types of construction does not belong to SKP, since January 1st of 2004 is substituted by Classification of typed of construction CZ – CC.

VI – 9.3 CLASSIFICATION OF TYPES OF CONSTRUCTION CZ - CC

“Klasifikace stavebních děl CZ-CC“ (Classification of Types of Construction CZ-CC) has been introduced since January 1st, 2004. It is derived from the international standard “Classification of Types of Construction – CC“, introduced by Eurostat in October 1997. It is compulsory for all statistic searching under act No 89/1995 Coll. (and its amendments). The object of this classification is a complete construction work which can be used for its given purpose. Technologic facilities, which can be dismantled and mover, are not included.

There are 4 parts of the CZ-CC: - normative, - methodological, - systematic, - notes and converters. Pattern of classification: X sections (2 sections: buildings – civil engineering work) X divisions (6 divisions, e. g. 11 – residential buildings) X groups (20 groups, e. g. 111 – one-flat residential buildings) X classes (46 classes, e. g. 1121 – two-flat residential buildings) X subclasses (335 subclasses) Next detailed division uses partly Classification of types of construction (KSD, division 46) and respects the classes of European standards CC. The classification unit is built structure and each built structure is classified on its own. In practise, there can be exceptions. In case of multipurpose buildings, the classification is from sections to subclasses according to prevailing use. 1 Buildings 11 Residential buildings

111 One-flat buildings 112 Multi-flat buildings 113 Other residential buildings


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12 Non-residential buildings 121 Hotels and similar buildings 122 Buildings for administration 123 Commercial buildings 124 Buildings for transport and telecommunication 125 Industrial buildings and warehouses 126 Buildings for cultural purposes, research, education and health care 127 Other non-residential buildings

2 Civil engineering work

21 Transport work 22 Highways, roads, local and special communications 23 Railways, tramways 24 Airport grounds 25 Bridges, elevated highways, tunnels, subways 26 Ports, waterways, cascades and other hydraulic work

22 Pipelines, telecommunication or power 221 Long-distance pipelines, long-distance telecommunication or

power lines 222 Local pipelines, local power or telecommunication lines

23 Ensembles of buildings and other structures for industrial purposes 230 Ensembles of buildings and other structures for industrial purposes 24 Other civil engineering work

241 Construction work for sport and recreation 242 Other civil engineering work

For details see http://www.czso.cz.


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VI - 10 TECHNICAL STANDARDS AND TESTING

VI – 10.1 EUROPEAN TECHNICAL HARMONISATION Present and future activities dealing in technical standards reflect the harmonisation rules with EC norms under the Government agreement No 97/1993 Coll. of March 3rd, 1993 (Principles of Harmonisation). The establishment of technical standards of the EC is regulated by the Government agreements No 631/1994 Coll. and 432/1997 Coll. and other. The Directive 89/106/EC is the principal document for unification of products used in construction or manufactured by construction (building materials). The goal of it is to guarantee a free circulation of these products throughout the EU. Main requirements in public interest are laid down in it, i. e. mechanical strength and stability, fire safety, hygiene, health and environment issues, safety in use, protection from noise, energy consumption and heat retention. These requirements are to be fulfilled before products are introduced into the market. It is supposed that these requirements will be comprised in a more detailed version in “harmonised technical specifications“.

As regard construction, in reference with the Directive 89/106/EEC, there are

“mandates“, i. e. orders by the CEN European commission on preparation of harmonised standards, for preparing selected groups of products. It is supposed that these mandates will include approx. 600 harmonised European standards for building materials and approx. 1,500 supporting standards. Documents for structures are prepared by the technical commission DEN/TC 250. For their complexity these documents are published as European preliminary standards (ENV), which are transformed in the EN system.

In 1997 the compatibility of the Czech and European standard systems was

achieved, when 80 per cent of European standards were introduced into the Czech standard system, and the Czech Republic has joined the European organisations for standardisation, CEN and CENELEC, as full member.

The process of harmonisation is characterized by

- State guaranty for formation and publishing of standards (CSN), - CSN standards are formatted and published by an independent body authorized by the State, - CSN standards are not obligatory, - harmonized standards are introduced, - logo CSN is protected by law, etc.

Most important acts and decrees in force are the following ones:

- Act No 20/1993 Coll., on the State control of standardisation, amended by acts No 22/1997 Coll., 119/2000 Coll., 137/2002 Coll. and 309/2002 Coll.


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- Act No 22/1997 Coll., on technical requirements of products, amended by acts No 71/2000 Coll., 102/2001 Coll., 205/2002 Coll., 226/2003 Coll. and 277/2003 Coll. - Government decrees No 17, 18, 20, 22 to 27/2003 Coll., on technical requirements of selected equipment, products or systems (in force since May 1st, 2004) - Government decree No 179/1997 Coll., on the Czech logo of conformity, amended by the Government decrees No 585/2002 Coll. and 291/2002 Coll. (on the logo “CE“) - Act No 59/1998 Coll., on the liability of indemnity, amended by act No 209/2000 Coll. - Act No 102/2001 Coll., on the safety of products - Government decree No 163/2002 Coll., on technical requirements of selected products used in construction - Government decree No 190/2002 Coll., on technical requirements of “CE“ products used in construction, establishing and defining responsibility, in reference to European technical attestation (ETA), rules of ETA (ETAG) etc., amended by the Government decree No 251/2003 Coll. - Government decree No 173/1994 Coll., amended by Government decrees No 174/1998 Coll., 78/1999 Coll., 323/2000 Coll., 344/2000 Coll. and 329/2002 Coll., which lay down the list of selected products for attestation of conformity - Government decree No 339/2002 Coll., on publishing of information referring to technical standards or documents, amended by the Government decree No 178/2004 Coll.

VI – 10.2 ATTESTATION OF CONFORMITY

At September 1st, 1997 act No 22/1997 Coll., on technical requirements of products, was put in force (amended by acts No 71/2000 Coll., 102/2001 Coll., 205/2002 Coll., 226/2003 Coll. and 277/2003 Coll. This act has:

- established common duty to introduce only safe products into the market, - established an independent supervisory system and raises penalties, - defined basic concepts, state attestation, certification or accreditation, - arranged fixing of technical requirements of products, which could threaten health of safety of persons, property or environment, - arranged conditions for edition of standards, attestation of conformity etc. It was amended by the following acts: Act No 71/2000 Coll. has established the status of Czech technical standards (ČSN) laying down that “the Czech technical standard is not obligatory in general sense“. It can get obligatory through another act. In act No 71/2000 Coll. another important concepts are newly defined, e. g. - introduction into the market, technical requirements of products, technical documents and prescriptions, harmonised standards, - duty to inform, - duties of authorised bodies, - attestation of conformity and conformity declaration.

At July 1st, 2001 the act No 102/2001 Coll., on general safety of products, was

put in force. It has defined tasks and duties of producers, importers or distributors more


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precisely and has introduced concepts like “Czech technical standard“ or “Harmonised European standard“ etc., supporting the harmonisation of Czech and European law.

Act No 205/2002 Coll. ha defined tasks and duties of importers or distributors CE

products more precisely, has introduced the full compatibility of supporting Czech decrees and European directives, has amended information duties, incl. notification of authorised persons, and the declaration of the conformity attestation and had laid down the use of the Czech conformity logo (CCZ or CE).

Act No 226/2003 Coll. reflected the new version of the chapter 8 of the Protocol

to the European agreement of attestation of conformity and industrial products acceptance, relating to the origin of products.

Act No 277/2003 Coll. reflected the directive 2001/95/EC and established new

conditions for introduction of products into the market.

VI – 10.3 LIABILITY OF INDEMNITY

The Civil Code and the Commercial Code (act No 531/1991 Coll., consolidated by act No 64/2001 Coll., and its later amendments) are basic norms of the Czech law referring to the liability of indemnity. Since July 1998 act No 59/1998 Coll., amended by act No 209/2000 Coll., on the liability of indemnity, has been in force. It has made the Czech law more harmonised with the European law (e. g. Directive 85/374/EC, on responsibility of product defects), laying down that both bodies, sellers and producers are responsible for damages caused by defective goods. In the EU the liability of indemnity is regulated by the Directive 85/374/ECC (regulating the compensation for damage to health, life of property, defective services excl.). At July 1st, 2001 act No 102/2001 Coll., on general safety of products, was put in force. It was amended by acts No 146/2002 Coll. and 277/2003 Coll. (the last mentioned act reflects the Directive 2001/95/EC. The goal of it is to harmonise the Czech law and the European law in this respect.

Tasks and duties, referring to the safe use of products introduced into the market,

are as follows: Exporters or importers may introduce only safe products into the market. Distributors are not allowed to distribute products, which are not safe, as far as they know or are able to know. Persons introducing a safe product, which can get dangerous under special conditions, must deliver information of such a possibility and must inform of ways of safe use. Products must be taken off market by producers, importers or distributors whenever a danger related with the use of such a product has been ascertained. All businesses or individuals that could make a product unsafe are obliged to take such a product out off market.


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VI – 10.4 ACCREDITATION Accreditation is an official authorisation to some activities, e. g. laboratory testing, calibration, certification of products or quality systems, inspection etc.

Český institut pro akreditaci – ČIA (the Czech Institute for Accreditation) is entitled to award accreditation in the Czech Republic (the accreditation is awarded for five years). ČIA supervises all authorised bodies as well. The Counsel for Accreditation is the permanent consulting body of the ČIA. Sources – Chapter VI: Legal norms mentioned above Odvětvová klasifikace ekonomických činností (OKEČ), ČSÚ (Classification of economic activities CSZO,) Standardní klasifikace produkce (SKP), ÚRS Praha, a.s. (Standard Classification of Products) Klasifikace stavebních děl (CZ-CC) (Classification of types of construction) Individuální konzultace (Individual consultations)