German recession to hit the Czech Republic

The conservative newspaper Lidové noviny fears that the economic downturn in Germany will also affect the Czech Republic: "Although Germany's share of Czech exports is sinking continuously, it still accounts for more than 30 percent. According to calculations by the Federal Statistical Office Germany is now in a recession, and that will no doubt have repercussions on the Czech Republic. ... 2009 will be hard. We can expect prices to rise, regardless of the drop in oil prices and the slowdown in inflation. As opposed to recent years, however, unemployment will rise as well. Companies must adjust to sinking demand by cutting costs. That means layoffs."

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