Business Environment and Competitiveness of Czech Republic after Accession to the European Union

Abstract

Purpose of the article: European Union can be considered as a full integration process including political, safety, social or economic aspects. Economic integration is process of interconnection otherwise separated national markets (by removal of economic borders). This assumes removal of all obstacles (in economy, trade, tax, administration or industrial area) and establishment of common rules for market competition. Basic benefit of economic integration is occurrences of real or potential competitiveness effects. Methodology/methods: European integration influenced number of factors of business environment mainly in area of legislation, taxes, public competition or harmonization of norms which can result in overall Czech Republic competitiveness abroad. In these papers have been used DB and GCI indexes and their subsequent indicators to analyze competitiveness and business environment in CR. Scientific aim: The aim of this article is research on impact of European integration on business environment and competitiveness of Czech Republic. Findings: Growing DTF trend for DB index since 2004 shows improvement of business environment after accession to the EU in contrast with non- EU members (Switzerland, Norway) which remains flat. The biggest benefit for Czech business environment seems to be trade liberalization as Czech companies were able to compete successfully at foreign markets. On the other hand, according to GCI remains biggest challenge non- effective bureaucracy, tax regulation, corruption, political instability and low business sophistication. Conclusions: Czech Republic should focus, consistently with Lisbon strategy, on qualification of labour forces, increase of innovation capacity and support of more sophisticated businesses with higher added value.