Economic prospects are good. The economy is thriving.Strong demand and exports are driving growth.Economic growth will slow due to labour shortages but remain above its potential.Poverty and inequality wellbeing indicators are good.Low productivity is limiting convergence towards OECD living standards.GDP per capita has been increasing but convergence towards OECD living standards is slow. Better skilling, R&D and innovation are needed for the upgrading of the economy. Better skilling is necessary to increase labour productivity and innovation to maintain the price competitiveness and to favour upgrading in value chains. Increasing labour force participation of women with young children would reduce labour shortages.An acceleration of immigration procedures and facilitation of immigrants’ integration could reduce labour shortages. The Czech Republic has to address the challenges of an ageing society. Ageing will weigh on public finances.Retirement age should be tightly linked to life expectancy. Financing of health and long-term care can be expanded making all types of income contributing. There is room to improve the delivery of health care. The Czech health care system performs well along several dimensions but can be improved. Indicators for the quality of care and outcome performance are missing in the management and regulation of the health care system. The delivery of health care could be improved through better management of hospitals; and putting more incentives in the remuneration scheme of health providers. The efficiency of the delivery of primary care is suffering from lack of co-ordination.