Despite an increase in the average wage in the Czech Republic at the end of last year, consumer prices rose even more in the fourth quarter of 2023, resulting in a continued decline in real wages for the ninth consecutive quarter, Novinky.cz writes. Analysts warn that wages are failing to keep up with inflation with data from the Czech Statistical Office (ČSÚ) expected to shed more light on the situation next week. Jakub Seidler, chief economist of the Czech Banking Association, noted that year-on-year growth in wages slowed down in the fourth quarter of 2023 to 6.5 percent from 7.4 percent in the previous quarter. While wages saw rapid growth in certain sectors, such as real estate activities, others, like agriculture, experienced minimal growth, exacerbating the overall decline in real wages. Vít Hradil, chief economist at Cyrrus, estimates that nominal wage growth reached 6.6 percent for the entire economy, falling short of covering inflation, leading to a 0.9 percent decrease in real wages year-on-year. This trend of declining real wages has persisted for the second consecutive year, with Martin Gürtler, an analyst at Komerční banka, highlighting a significant decrease in purchasing power over the past two years. Looking ahead, analysts...
The Czech Republic’s economic standing within the European Union (EU) has weakened for the second consecutive year, according to the 2024 Prosperity and Financial Health Index. Compiled by Česká spořitelna and Europe in Data, the index reveals the Czech Republic now holds the 14th position, down from 12th in 2023 and 9th in 2022. While the Czech Republic boasts a diverse and complex industrial landscape, its economic performance is hampered by two key factors: low value added and persistently high inflation. The country recorded the second-highest inflation rate in the EU at 12%, surpassed only by Hungary at 17%. Food prices have emerged as a particular area of concern. Analyst Tereza Hrtúsová from Česká spořitelna points out that although the Czech Republic remains below the EU average price level for the overall consumer basket, the cost of essential items has risen significantly. Food prices have practically reached 97% of the EU average, with some items like sugar experiencing a year-on-year increase of nearly 40%. However, not all food prices have increased. Butter has seen the most significant price drop at 13%, followed by E-type cheese at 6%. On a more positive note, the Czech Republic regained its second-place position in...
Czech Republic and Poland on Tuesday said they are not considering sending troops to Ukraine after that option for European nations was mentioned at a meeting in Paris, but they agreed to cooperate on buying more ammunition for Kyiv. French President Emmanuel Macron raised the possibility on Monday of European countries sending soldiers to Ukraine, saying “nothing should be excluded”. Macron said, though, there was no consensus at this stage, while allies agreed to increase efforts to supply more munitions to Kyiv as its fight against Russia’s invasion enters a third year. The Kremlin warned on Tuesday that conflict between Russia and the U.S.-led NATO military alliance would be inevitable if European members of NATO sent troops to fight in Ukraine. Asked about Macron’s comments, Czech Prime Minister Petr Fiala and his Polish counterpart Donald Tusk said the option of troops was not being considered by their governments. “I am convinced that we should develop the paths of support that we embarked on after Russia’s aggression,” Fiala told a news conference alongside Tusk as they met in Prague on Tuesday. “I believe we do not need to open some other methods or ways,” Fiala said. Tusk added: “Poland does not...
Former US President Bill Clinton will head to Prague in March to deliver the keynote address at a conference marking the 25th anniversary of the Czech Republic’s membership in NATO. The “Our Security Is Not a Given” conference, organized by Jagello 2000, will take place on March 12th at Prague Castle’s Spanish Hall. Clinton, who served as US President from 1993 to 2001, is attending at the invitation of Czech President Petr Pavel. The organizers highlighted how, early in his presidency, Clinton proposed a vision of a united, democratic Europe free from conflict. “Inviting Central and Eastern European democracies into NATO was a key part of this vision,” they said, “and the 1999 expansion that included the Czech Republic, Poland, and Hungary was a historic step towards its realization.” This year’s conference, the 11th edition, will not only assess the Czech Republic’s quarter-century in NATO but also discuss the alliance’s future amidst a rapidly changing security landscape. On April 4th, NATO celebrates its 75th anniversary. Joining Clinton at Prague Castle will be Czech President Petr Pavel, Prime Minister Petr Fiala, Defense Minister Jana Černochová, and Foreign Minister Jan Lipavský. The panel discussion will also feature representatives from the opposition ANO...
Prague is now the fourth richest region in the European Union by GDP per capita, ahead of cities like Brussels, Paris, and Berlin. “Prague holds the number four spot in the EU regional ranking for 2022, based on GDP per capita,” confirmed Petr Dufek, chief economist at Bank Creditas. While two Irish regions and Luxembourg currently hold the top positions, Dufek highlighted the stark contrast between Prague’s prosperity and the rest of the Czech Republic, with the capital boasting more than double the national GDP per capita. “Prague’s success stems in part from hosting the headquarters of many major companies,” explained Dufek. However, a concerning disparity is emerging within the country. “Over the past nine years, GDP per capita has grown significantly faster in Prague than in other regions, widening the gap,” he noted. For further perspective, Dufek compared Prague to its neighbor, Berlin. “In terms of purchasing power parity, Berlin’s GDP per capita is only 60% of Prague’s, while Germany as a whole remains 30% wealthier than the Czech Republic.” Bratislava “In 2013, Bratislava surpassed Prague,” Dufek revealed. “But the latest data paints a different picture, with Bratislava now trailing at 71% of Prague’s level. Its GDP per capita...
EU countries, except Hungary, on Monday called for an “immediate humanitarian pause that would lead to a sustainable ceasefire” in the Gaza war, the bloc’s foreign policy chief Josep Borrell said. The European Union has struggled for a united response on Israel’s military operation following the October 7 attack by Hamas. “The joint statement addresses the humanitarian crisis in Gaza and the potential repercussions of the planned military operation in Rafah. On behalf of the Czech Republic, I believe it is critical to underscore international humanitarian law and acknowledge the State of Israel’s right to self-defense,” stated Czech Minister Jan Lipavský, adding that this represents “a comprehensive perspective encompassing the diverse positions within Europe.” On Monday, the ministers also deliberated on further sanctions against the Hamas terrorist organization and radical Jewish settlers. Lipavský reiterated the Czech stance, emphasizing that Prague has no objections to the sanctions package itself; however, they oppose linking the two groups, rejecting “any attempt to draw an equivalence between Hamas terrorists and extremist political activists.” “I believe everyone clearly understood this position,” the Czech minister added, “but then another member state intervened and blocked the entire sanctions package, effectively ending the discussion for today.” He confirmed...
The Czech Republic’s consumer price inflation eased more-than-expected in January to the lowest level in nearly three years, largely due to a sharp slowdown in utility costs along with a continued fall in food costs, data from the Czech Statistical Office shows. Consumer prices climbed 2.3 percent year-over-year in January, much slower than the 6.9 percent rise in December. Meanwhile, economists had expected inflation to slow to 2.9 percent. Further, this was the weakest inflation since March 2021, the agency said. The annual price growth in utilities eased markedly to 3.1 percent in January from 16.8 percent in December. The decline in prices of food and non-alcoholic beverages deepened to 3.9 percent from 0.3 percent. Meanwhile, transport charges rebounded 0.4 percent after a 0.2 percent drop seen in December. On a monthly basis, consumer prices rose 1.5 percent in January, versus an expected increase of 2.0 percent. The monthly upturn was mainly attributed to higher utility costs, especially electricity charges.
The Czech Defence Ministry and local industry have identified 800,000 units of available ammunition that could be delivered to Ukraine within weeks, if funding are secured. Ukraine desperately needs artillery ammunition to fend off Russian forces. Although the EU has promised to deliver one million rounds by March, it failed due to low production capacity. The Czech Republic is, therefore, exploring the possibility of buying ammunition from outside the EU. “Our Defence Ministry and our companies in the defence industry, through their contacts, have an overview of where equipment and ammunition are available,” Pavel said during a press briefing in Munich, where he attended the Munich Security Conference. According to Pavel, the Czechs have identified a significant amount of 155mm NATO-standard artillery shells and the 122mm calibre often used in the former Soviet Union. “As far as I know, our companies have identified, variously around the world, up to 500,000 NATO 155mm calibre rounds and up to 300,000 122 mm calibre rounds,” Pavel said. “In cooperation with our partners, mainly from Denmark, the Netherlands and Canada, we are raising the financial resources to cover the transaction. And then we will transport the equipment and ammunition to Ukraine through our resources,”...
French President Emmanuel Macron will visit the Czech Republic on Tuesday, March 5th. This was reported today by Czech Television and confirmed by the Czech ambassador in Paris, Michel Fleischmann. This upcoming visit marks Macron’s third official trip to the Czech Republic since 2018. His most recent visit took place in October 2022, when he attended the European Political Community’s Prime Ministerial Summit and the subsequent informal European Council Summit at Prague Castle. In October 2018, he commemorated the 100th anniversary of the founding of the Republic with a visit to the country. Last December, President Pavel met with Macron at the Elysee Palace in Paris. Following the meeting, President Pavel remarked on the close ties between the Czech Republic and France, highlighting their shared positions on issues like the war in Ukraine, the Middle East situation, energy security, and EU enlargement. Macron’s upcoming visit underscores the ongoing diplomatic cooperation between the two nations.
A Prague court on Wednesday acquitted for the second time former Prime Minister Andrej Babis of fraud charges in a $2 million case involving European Union subsidies. Babis had pleaded not guilty and repeatedly said the charges against him were politically motivated. The prosecution can still appeal the verdict. It had requested a three-year suspended sentence and a fine to be paid by the populist billionaire. Prague’s Municipal Court previously acquitted Babis and Nagyova last year in January. In September, Prague’s High Court canceled the lower court’s decision and ordered the case to be retried at the same court. The case centered around a farm known as the Stork’s Nest, which received EU subsidies after its ownership was transferred from the Babis-owned Agrofert conglomerate of around 250 companies to Babis’ family members. Later, Agrofert again took ownership of the farm. The subsidies were meant for medium- and small-sized businesses and Agrofert wouldn’t have been eligible for them. The conglomerate later returned the subsidy. Babis’ former associate, Jana Nagyova, who signed the subsidy request, was also acquitted. Judge Jan Šott said what they did was not considered criminal. Babi has become part of the country’s opposition after his populist ANO centrist...
The four-day workweek is gaining traction across Europe, with Germany leading the charge through a nationwide pilot program involving dozens of companies. While this trend might seem alluring, the Czech Republic finds itself at a crossroads, unprepared for full-scale implementation due to unique economic and cultural factors. Currently, enjoying a four-day workweek remains a rare privilege in the Czech Republic. Only a handful of companies offer it, and even then, with obstacles. “This benefit comes with demanding performance targets,” warns Dagmar Rottová, sales director at Citfin. Psychologist Jan Lašek echoes this concern, highlighting the potential strain on “memory, attention, and overall concentration” under a condensed schedule. Additionally, industries like construction and service sectors seem ill-equipped for such a shift. “It’s simply impossible for us,” says a café and bakery owner. “We’re open seven days, and hiring more staff wouldn’t be financially viable.” Official recognition or government-led trials are absent in the Czech Republic. The perceived limited applicability, primarily benefiting office workers, further complicates matters. “Sales, dealerships, and call centers are some roles where this system might work,” confirms Rottová. For Jiří Halbrštát, a labor market expert, success hinges on “internal company adjustments, like boosting productivity or automating tasks, to maintain...
An EU effort to impose sanctions on Israeli settlers attacking Palestinians in the West Bank has stalled due to objections from Hungary and the Czech Republic, diplomats say. The two staunch allies of Israel made clear in an EU committee on Thursday they were not ready to let the proposal go forward for now, said four diplomats, speaking on condition of anonymity about internal EU deliberations. Some said a compromise may be found later to let the measures proceed, possibly after more EU sanctions on Hamas, the Palestinian militant group responsible for the Oct. 7 attack on Israel that triggered the current Middle East crisis. While much international attention has focused on that cross-border assault from Gaza and Israel’s subsequent war there, European officials have also expressed increasing concern about rising violence against Palestinians in the West Bank. The United States and Britain have expressed similar concerns and have already imposed sanctions on several settlers they say are responsible for violence. EU foreign policy chief Josep Borrell said in December he would propose similar measures. But EU sanctions require unanimity among member states and the bloc has yet to find agreement – a reflection of broader divisions on the Middle...
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