czech trade integration over the last two decades

Abstract

Development of international trade is (in our view) one of the greatest achievements of the transformation process in Eastern Europe. In the paper we illustrate this achievement by the example of the Czech Republic. We conclude that the economy has enormously changed from closed one with backward production and orientation towards the Eastern markets to one that is among the most open economies in the world, with nearly entire orientation towards the developed markets and with relatively advanced production. This development was partly a result of quick (and in our view brave) liberalization at the beginning of the transformation process. At the same time, we have to conclude that the level of dependency has enormously increased in the course of the respective period and the Czech economy is now highly dependent on the economic development of the main trading partners – foremost the other European countries. This dependency is largely positive but can bring negative aspects in the periods of economic decline.