Prague

8. 8. 2011

The capital city of Prague is the major business hub of the Czech Republic. More than 10 percent of the country´s population lives here and the city´s economy accounts for 20 percent of the Czech GDP.

Prague (Praha) is the Capital City of the Czech Republic. It is a natural centre of politics, international relations, education, culture and economy. Within the EU, the Capital City of Prague is considered as one of the most attractive historical European cities. Since 1992, its historical centre has been on Unesco´s World Heritage List. All these aspects are reflected in the specific character and position of Prague among the regions of the CR.

Geography

Prague is the largest city of the Czech Republic. It covers the area of 496 sq km (0.6 % of the CR’s territory). However, with the population of 1,249,026 inhabitants (as of 31 December 2009) it represents 11.9 % of the total population of the CR. Prague dominates the population structure in the Czech Republic as its second largest city, Brno, makes one third of the Prague’s population.

Prague is located in the central part of Česká vysočina (the Bohemian Highlands), predominantly in the area of Poberounská soustava (the Berounka River Formations). Rather a small part situated in the northeast is included in Česká tabule (the Bohemian Plate). As for geomorphology, there is the flat relief of the high-raised areas on one hand, contrasting with the sharp valleys of the Vltava River and its tributaries on the other hand. The most broken topography originated on the left bank of the river. The highest point is the flattened landscape southwest of the Zličín town part (399 m above sea level), while the lowest point is the surface of the Vltava River at the north edge of the city at Suchdol where the River leaves the territory of Prague (177 m above sea level). Therefore, the maximum altitude difference exceeds 200 m within rather a small area.

From a geographical point of view, Prague can be considered a centre of Europe. It lies almost in the centre of the Continent, approximately the same straight–line distance away from three seas: the Baltic Sea (365 km), the North Sea (495 km) and the Adriatic Sea (490 km).

Transportation

Prague is a central point of all highway routes. Before the split-up of the former Czechoslovakia the first highway D 1 linking Prague, Brno and Bratislava was developed. The construction of the highway D 8 to lead from Prague via Dresden to Berlin is under construction. More and more painful becomes especially absence of alternate routes around Prague and, most of all, around the inner city. Up to now, only partial segments were built out of two rounds planned. Car city ring road Myslbekova - Pelc Tyrolka called „Blanka" is now under construction (started in 2007) to be put into operation in 2011. The south part of Prague ring was finalised in September 2010.

Prague is an important international railway node, too. Stress is being put on the development of railway transport on the European basis (e.g. Eurocity trains) along with the current phase-out on the less travelled tracks. The reconstruction of key railway routes to fit express traffic is under preparation. The reconstruction will contribute to high comfort of travel on long-distance routes, especially international ones. Trains connecting suburban areas form part of the Prague Integrated Transport. At present the construction of the "New Connection" was finished. Its aim is to connect the Hlavní nádraží railway station and Masarykovo nádraží railway station at one side and Libeň, Vysočany and Holešovice railway stations at the other side, to increase the capacity of these stations. The construction is scheduled to be finalised in December 2010 (including recultivation of surroundings).

Air transport of freight as well as passengers is provided particularly by the Prague-Ruzyně airport. In 2009, there were 11,643,366 passengers checked-in which represents an annual decrease of 7.8 %. The new Sever 2 terminal was opened in January 2006 to which all the flights to Schengen countries were transferred. What is important for the Prague airport is the development of long-distance flights, thanks to which the number of passengers who use the Czech capital as a transfer point for flights to distant destinations increases. The Prague airport also prepares an expansion of the airport track, the new parallel track should be put into operation in 2010.

Prague has relatively well functioning public transport with a backbone system of the metro (almost 60 km long) and networks of tram railways (142 km long). More than 1 billion passengers use public transport vehicles a year and 1,650 million km are driven. Urgent need to make the public transport more attractive helped gradual origination of the system of Prague integrated transport. Now, it is operated up to 35 km far from Prague and thus it includes also an important part of the Středočeský Region (about 240 municipalities). Even though important investments were completed building the transport infrastructure in order to help the city centre suffering from traffic jams remains to be a priority in Prague.

Economy

Prague has a unique position within the Czech Republic; it is an economic centre of the state and also a centre for intermediation of impacts of multinational economic relations in the whole state. Most financial institutions and foreign undertakings are based here. This has a significant effect on the Prague economy. Its economic output accounts for almost a quarter of the GDP. Privileged position of Prague owes also to investors interested in this area which is a gateway to the Central and East European markets.

Economy of the region expressed in GDP in current prices has been recording a permanent growth. The year-on-year increase since 2001 stands at the national average even after the accession of the CR to the EU in 2004, which positively affected the economy of the whole country by improving conditions for trade with the EU states. GDP in Prague per capita highly exceeds the CR average as well as the average for the whole EU. The higher level of GDP production is typical for metropolises. It is caused by many factors: higher level of wages, location and registration of headquarters of economic entities in the city, presence of subsidiaries of multinational companies, concentration of central bodies of the public and private sectors. These phenomena are linked with agglomeration effects which lead to cutting company costs as a result of concentration of various economic and supporting activities.

Basic structural reconstruction was reflected in changes of branch structure of Prague economy. Characteristic features of the development of Prague economic basis are strengthening of the sphere of services and decrease of share of production industries. Tertiary industries represent now in Praguemore than 80% of value added. Also employment rate in this sphere in Prague markedly exceeds data from all the regions. In 2001, 77% of all employed in Prague worked in services and in 2009, it was 80 %. The share of people employed in terciary inductries is constant for a relatively long time.

On the contrary, the share of industrial sector in creation of value added and Prague''s employment is much lower than national average. Industry as a branch does not have such an important position in Prague as in other regions of the CR.

Also construction showed consequences of crisis. 147 construction enterprises with 50+ employees were based on the territory of Prague by the end of 2009 (it is by 20 more than in 2008). Number of completed and started dwellings was, as usual, second highest from 14 regions, right after the Středočeský region. In 2008 , the decline of intensity of dwellings construction was recorded. In 2009, the builders concentarted on the finalisation of the dwellings (the number of completed dwellings have increased), but less dwellings were started, which confirms the economic crisis influence.

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Labour market

Prague is the largest regional market in the CR. Job positions in Prague are not only opportunities for inhabitants of the city but also for inhabitants from wide surroundings and in fact the whole CR. According to results of the 2001 Population and Housing Census, the number of filled job vacancies in Prague represented a fifth of all job vacancies in the CR. The number of jobs as of March 1, 2001 was nearly 726 thousand and there were 125 thousand less Prague inhabitants searching for a job. The importance of commuting has got an exceptional meaning for Prague.

The labour force in Prague is significantly higher skilled than in other regions. Almost 30 % of employed are persons with a university degree and their number has been steadily increasing. The average wage in Prague is significantly higher than in the rest of the country. A low unemployment is another characteristic feature of the Prague’s labour market. The Prague’s labour market was, thanks to a wide offer of professions, able to absorb almost all labour force released in the process of transformation as well as newcomers. Lately, the unemployment level in Prague has been developing similarly to the national average, in total however it is around half of the value. Prague also affects the rest of the Czech Republic, especially the Středočeský region part of which is closely connected to Prague due to an intensive commuting lowering the unemployment in the region.

Tourism

An important branch for Prague''s economy is tourism. Prague has become a favourite destination of tourists from abroad, who represent more than 90 % of all accommodated guests, most often come clients from the United Kingdom and Germany. However, Prague is also a common target of domestic business trips and it is an important centre of congress tourism.

The capacities of hotels has been growing, primarily 3 star, 4 star and 5 star hotels as a response to the demand represented by an increasing number of tourists accommodated in these hotels. As air transport gets cheaper, there has still been an increasing popularity of weekend tours. Tourist season in Prague is not limited to time, however, summer months are preferred. Guests accomodated in Prague are one third of all guests in the Czech Republic, when foreigners represent 63 % of all foreigners accommodated in the Czech Republic.

Social affairs

Prague is a national centre of education. Prague has the highest number of grammar schools and secondary technical schools of all the regions. Prague''s position is absolutely unique in university education. There were 33 universities with 119 thousand students in the school year 2008/2009. The number of students has been slightly increasing. During the last few years, existing demographical development has been reflected also in shifts in school establishments. Number of basic schools as well as their pupils is slightly decreasing. Numbers of students at secondary schools are more or less stagnating.

There are specialised and research health institution serving to patients from all over the Czech Republic. Almost one fifth of all physicians working in the CR are employed in Prague. Relative indicators from health grossed up to 1,000 population are permanently the highest of all regions and are markedly above the national average, because all Prague’s health establishments serve also to the surroundings of Prague and basically to population of the entire CR as well. While there are more and more non–state establishments in other regions (after transfer of health establishments to the competence of regions), this is not the case of Prague, in which almost a half of all physicians works in state health establishments. It is a phenomenon characteristic for Prague.

Prague`s position within EU

On May 1, 2004, the Accession Treaty of the Czech Republic with the European Union entered into force and thus the Czech Republic together with other nine countries integrated in the geopolitical space of Europe. Prague with its population ranks ninth among the 25 EU Member States.

Prague ranks among important and developed regions even within the entire EU. This is caused by its long-term historical development and also its geographical location. Prague is an attractive territory for foreign investors. The quality of connection from Prague to European and worldwide communication network has significantly improved. There is a stable and manifold labour market and potential of labour force with above average qualifications. The top quality education, science and research institutions play an important role.

Prague`s website

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