Overview of the latest economic events in the Czech Republic

The Czech economy is on a moderate upswing in the first half of 2025. According to current data from the Ministry of Finance and the Czech National Bank, GDP growth is expected to be in the range of 1.6-2.5 %, with the main factors being rising domestic demand, investment in infrastructure and stabilising energy prices.

Inflation held at 2.5 % in April, in line with the CNB's target, despite global inflationary pressures. The exchange rate of the koruna was stable at around CZK 25.10/EUR. The RM-SYSTÉM and Prague Stock Exchange saw a slight increase of 0.8 % in the PX index, with investors encouraged by positive corporate results of companies in the energy and telecommunications sectors.

Foreign investment

Foreign investment in the Czech Republic has seen several significant developments:

  • GE Aerospace announced an investment of CZK 135 million in its subsidiary GE Aviation Czech in Letňany. The project is aimed at modernisation of production facilities and expansion of aircraft engine production.
  • Yanmar Group bought a Czech engineering company from Japan Tedom, which specialises in CHP units. The transaction was carried out with the investment group Jet Investment, which has owned Tedom since 2010.
  • Emposat, a non-EU company, unsuccessfully tried to acquire a stake in a defence technology company. The Czech government blocked the transaction under a new law on foreign investment screening - a historic first in the Czech Republic.

These cases show the growing interest of foreign investors in Czech industry and the stricter control framework of the state in strategic sectors.

Significant events outside the Czech Republic with global impact

The global economy is facing a combination of geopolitical tensions and renewed growth. The OECD expects global GDP growth of 3.3 % between 2025 and 2026:

  • The strengthening of the US dollar, which is having an impact on commodity prices.
  • The ongoing conflict in the Middle East, which is driving up oil prices.
  • Increasing regulation of technology exports between China and the US, slowing some investment flows.

Despite this, investment activity in Europe and Asia remains robust, particularly in sustainable energy and automation.

Business Transactions and Acquisitions - a selection of six key cases

  1. O2 Czech Republic acquired Nordic Telecom Holding
    Telecom giant O2 completes acquisition of 100% stake in the company Nordic Telecom Holding. This transaction will significantly expand O2's portfolio in wireless internet and 5G spectrum access. The value of the transaction has not been disclosed, but estimates are in the hundreds of millions of crowns.
  2. Yanmar Group bought Tedom
    Japonský koncern Yanmar Group completed the purchase of a Czech energy company Tedom, strengthening its presence in Europe in the energy sector. This move is a strategic response to the growing demand for decentralised energy sources.
  3. GE Aerospace invests in GE Aviation Czech
    As part of its expansion and increased competitiveness, the American company announced GE Aerospace an investment of CZK 135 million in the plant GE Aviation Czechwhich manufactures turboprop engines for regional aircraft.
  4. Ban on Emposat's investment
    The Ministry of Industry and Trade banned the acquisition of the company Emposat citing a threat to national security. This precedent confirms the tightened oversight of strategic investments.
  5. TPA Group and real estate transactions in logistics
    Poradenská skupina TPA recorded several significant mergers and acquisitions in the logistics and industrial real estate segment. Among the most significant is the consolidation of distribution centres in Moravia under an international fund based in Luxembourg.
  6. EY Czech Republic highlights the growth of mergers in finance
    According to EY, there were 16 M&A deals worth €737 million in the first quarter of 2025. Most of the interest is in companies in the energy, finance and consumer goods sectors, as confirmed by the recent transactions above.
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