Although most business analysts predicted that the country's foreign trade balance could end with a surplus of 200 million to 500 million Kč for the month, high oil prices on worldwide markets caused the balance to sink.

"High oil prices pose the main threat to Czech foreign trade," said Deputy Industry and Trade Minister Martin Tlapa.

The ČSÚ reported that trading in fossil fuels and other raw materials contributed the most to the deficit.

Over the first seven months of this year, the country had a foreign trade surplus of 36 billion Kč, down 600 million Kč against the same period last year.

The strengthening crown helped reduce the losses resulting from high oil prices, ČSOB economist Petr Dufek said.

The foreign trade surplus with European Union countries increased 3.7 billion Kč against the same period last year. The trade balance with Hungary, Belgium, Austria, Germany, Switzerland and Italy improved greatly. But the trade deficit with non-EU states widened 4.2 billion Kč.

Raiffeisenbank's analyst Aleš Michl said it was up to the new government to start improving business relations with non-EU member states, too.

"New government members should start making business trips to former Soviet countries and to Asia and China, where they should help promote Czech businesses," Michl said. "Expansion to the Eastern market would reduce the country's strong dependency on the EU."

Exports increased 14.4 percent and imports added 14.9 percent in that period.

Machinery and transport equipment exports increased 22.1 percent, reaching a value of 15 billion Kč, while imports in the two categories rose 14.9 percent (8 billion Kč).

Increasing oil prices caused the value of fossil fuel imports to increase 3.8 billion Kč — growth of 28.4 percent. Oil imports increased in price 33.1 percent and 11.4 percent in volume.

The ČSÚ also released final foreign trade data for 2005. According to the results, the 2005 surplus reached 38.6 billion Kč, down 900 million Kč against the original figure.