Politics & Economics

Czech Government Earmarks CZK 66 Billion to Help Ease Energy Price Shock

The Czech government will earmark 66 billion crowns to help households and companies hit by soaring energy prices, Industry Minister Jozef Sikela said on Wednesday. Measures aimed at taming the price shock in the next winter heating season will include the state covering some “green energy” fees and giving subsidies to households, including a planned discount electricity rate subsidised by the state. Around two-thirds of the assistance will go to households, Sikela said. Moreover, the Czech state has prepared a website called the “Umbrella against Inflation” (Deštník proti drahotě) where it summarizes the aid available to different groups in the population due to price rises and will allocate approximately CZK 100 billion [EUR 4 billion] from the budget this year for the anti-inflation measures; the information portal was created to make the situation more transparent and to serve as a guide on how to claim eligibility for it. Czech Prime Minister Petr Fiala (Civic Democratic Party – ODS) announced the portal last week after the cabinet session. According to Fiala, the cabinet has had to deal with high prices and inflation from their onset at the end of last year and “the lavish behavior and policy of the previous Government had...

by Prague Morning Jun 22, 2022

Czech Government Cracks Under Prague Corruption Scandal

Czech Education Minister Petr Gazdík announced his resignation on Sunday following revelations that he attended several meetings with organized crime boss Michal Redl. Along with Gazdík, who also served as a deputy chair of the Mayors and Independents (STAN) party, Czech MEP Stanislav Polčák (EPP) was also in touch with Redl. His political future is now also in question and will be addressed by the Prague organisation of STAN this week. On Wednesday (15 June), Deputy Mayor of Prague Petr Hlubuček (STAN) and ten other people were charged with bribery and organised crime linked to the Prague Transport Company. The scandal is particularly painful for STAN as the centre-right party performed well in last year’s general elections and became the third strongest political party in the Czech parliament. The State Prosecutor’s Office has begun investigating a leak of documents from the corruption investigation, Czech Justice Minister Pavel Blažek confirmed the news on Twitter on Sunday, saying he would inform the government about the circumstances of the case on Wednesday. On 1 July, the Czech Republic is taking over the Council of the EU Presidency. “My contacts with some people cast a shadow over the STAN movement. I do not want...

by Prague Morning Jun 20, 2022

Czech Government Announced Logo, Motto and Slogan for its Presidency of EU Council

On 15 June 2022, Prime Minister Petr Fiala presented the political priorities of the Czech EU Presidency at the Hrzánský Palace. Together with the Minister for European Affairs Mikuláš Bek and the Head of the Office of the Government of the Czech Republic Jana Kotalíková, they also unveiled the official logo, motto and present the organizational details. The Czech Presidency of the Council of the EU begins on 1 July 2022. The program was unveiled under the motto “Europe as a task: rethink, rebuild, repower.” The slogan, inspired by the late author and statesman Václav Havel, is meant to symbolize the new chapter in Europe’s history opened by Russia’s invasion of Ukraine. “We can say that the world will not be the same after Russia’s aggression,” Fiala said, speaking to reporters at the Hrzánský Palace in Prague. “We want to play an active part and rewrite Europe’s future.” The war has shaken the continent’s “certainties”, exposed its “vulnerabilities” and “fundamentally” altered its security architecture, the prime minister said, calling on the EU to tackle these challenges in an “active way” rather than as an observer relying on other great powers. Every six months an EU member state is assigned to preside...

by Prague Morning Jun 16, 2022

Zelenskyy in Front of the Czech Parliament: “We’re With You, Be With Us”

The president of Ukraine, Volodymyr Zelenskyy, spoke this morning (Wednesday, June 15) to both houses of the Czech Parliament via video. Zelenskyy reminded Czechs of historical parallels between Czechia and Ukraine, evoking the years 1938, 1948 and 1968 as well as famous mottos such as “We’re with you, be with us” and “Truth and love must prevail over lies and hatred”. He also addressed the importance of the Czech Republic’s EU presidency in relation to the possibility of Ukraine’s candidacy status and more sanctions against Russia. According to him, the Czech Republic can participate in the renewal of Ukraine for example by taking patronage over Ukrainian regions. “Russia’s invasion of Ukraine is only the first step in paving the way for other states. (…) Not only Russian propagandists, but also senior state officials talk openly about it,” he said. Leaving the territory to Russia would not resolve the situation. “He who wants to seize everything will never stop,” he said. Zelenskyy spoke also about Ukraine’s ambition to become a candidate country of the European Union. “Granting Ukraine candidate status means proving that the European Community is real, that European values work and are not just empty words in several documents”....

by Prague Morning Jun 15, 2022

Debate Rages Over Free Public Transport in Prague

“We want free public transport in Prague”, the opposition claims. “It is just a pre-election move”, the city management replies. The chairman of ANO Party, Ondřej Prokop, came up with a controversial proposal for free public transport in Prague until the end of 2022. Prokop argued that public transport in Prague is still not full after the coronavirus epidemic and that many cars run empty or half-empty, and Prague residents need to be positively motivated to use public transport. The second argument is Prokop’s claim that the people of Prague are facing an energy and inflationary crisis. “As the economic situation is deteriorating significantly, many Praguers are falling into poverty, and public transport is still not full, we will propose public transport completely free of charge until the end of 2022,” Prokop wrote in a report to journalists. “Of course, we understand the difficult situation of citizens in these times, but this must be addressed through targeted assistance and not wasteful budgeting. At the same time, it is important to maintain the quality of Prague’s public transport. Frequent connections, building new tram lines, metro lines, electrifying bus lines, buying new modern vehicles and we can only ensure this thanks to...

by Prague Morning Jun 15, 2022

Czech Inflation Hits 16%, Raising Bets of Big June Rate Hike

Czech headline inflation soared to 16% in May, above expectations, to hit a nearly 30-year high, statistics office data showed on Friday. The data – above the central bank’s forecast of 14.9% – added to bets the Czech National Bank would deliver another hefty interest rate hike when the board meets under its current composition for a final time this month. Markets are now pricing more than a 100-basis-point rate hike to take the base rate well above 6% on June 22, before three of seven members’ terms end. “After this figure, I believe the bank will go for a big hike, not just a 75 basis point move already indicated. The question is how much more,” Pavel Sobisek, chief economist with UniCredit in Prague, said. The country’s president named three new members to the central bank board this week, easing market worries about a sharp dovish swing in the board. Czech central banker Ales Michl, who has opposed the 550 basis points in rate hikes delivered in the last year, will take over as governor from July and has sought rate stability. Central banks around central and eastern Europe have already sharply raised rates in the last year to...

by Prague Morning Jun 11, 2022

Demand for Offices in Prague Has Returned to Pre-Pandemic Levels

The Czech branch of Colliers, a leading provider of diversified professional services for commercial real estate and investment management, published a survey of the Prague office market for the first quarter of 2022. According to this survey, there was a further increase in vacancy, which increased across Prague. However, gross take-up recorded a year-on-year increase of 44 %, and thus returned to pre-pandemic levels. The increase in prices throughout the city is still felt especially in construction projects, mainly due to rising costs for materials and construction work. Record volume of gross take-up The first quarter of this year was very successful, especially in terms of gross take-up. With a total of 135,600 sqm, it was the highest volume ever recorded during the first quarter. „A year-on-year increase of 44 % shows that we are back at pre-pandemic levels and the demand for offices seems unscathed,“ says Josef Stanko an analyst at the consulting company Colliers. Almost 40 % of the net take-up, which amounted to 75,700 sqm, was concluded in Prague 8, confirming that Karlín and surrounding areas are still the most sought-after submarkets. The following most sought-after districts were Prague’s 1, 4, and 5. Rising vacancy and low...

by Prague Morning Jun 08, 2022

Unemployment in the Czech Republic Fell to 3.2% in May

Unemployment in the Czech Republic fell to 3.2 percent in May, a decrease of 0.1 percent when compared with the previous month, data published by the Czech Republic’s Labour Office on Wednesday show. There are 235,468 job seekers in the country, 8,190 less than in April. The number of job vacancies decreased by about 7,000 compared to the previous month. Last May, unemployment in the Czech Republic was 3.9 percent. The labor market continues to be affected by seasonal work, which is in full swing, especially in construction, gastronomy, tourism, agriculture and horticulture, but also in forestry, fishing, spa and mining, said Viktor Najmon, director of the Czech Labor Office. According to Najmon, unemployment could fall even further. “But everything will also depend on how the war in Ukraine develops and on the impact of the energy crisis on businesses,” he said. According to available sources, a total of 68,885 citizens found a job since the Russian invasion of Ukraine; currently, at the end of May, 56,388 Ukrainians were working in the Czech Republic with a temporary visa. Most of them are in the Pilsen, Central Bohemia regions and in Prague. Most unemployed people are in the Karviná region The...

by Prague Morning Jun 08, 2022

Czech President Milos Zeman Vows to Block Same-Sex Marriages

Czech President Milos Zeman said Tuesday that he is ready to veto, if it’s approved by parliament, proposed legislation that would give same-sex couples in the country the right to hold civil weddings. The bill drafted by lawmakers from across the political spectrum was submitted to the Czech Parliament’s lower house Tuesday, but no date has been set for the beginning of its debate. It is strongly opposed by the Christian Democrats, a member of the governing five-party coalition, and by the opposition Freedom and Direct Democracy, an anti-migrant and anti-Muslim populist party. “I’d like to announce that if I really receive such a law to sign I will veto it,” Zeman said Tuesday after meeting his Hungarian counterpart Katalin Novak. Zeman noted that the Czech state already enables civil unions for same-sex couples, “But a family is a union between a man and a woman. Full stop.” The Czech president is known for derogatory comments about the LGBTQ community. A majority of all lawmakers in the lower house can override the presidential veto. The Czech presidency is a largely ceremonial post. Parliament already started to debate similar legislation in 2018 but didn’t take a vote on it before last...

by Prague Morning Jun 07, 2022

Inflation to Exceed 12%, Economy to Slow Down, Finance Ministry Predicts

The Ministry of Finance has presented its first economic forecast, having also taken into account the war in Ukraine. It has thus significantly worsened its estimate of the Czech economy’s growth this year to 1.2 percent from 3.1 percent in January. At the same time, in comparison to the January estimates, the office expects higher average inflation for this year at 12.3 %. So far this year, it has predicted a price rise of 8.5 percent. Economic growth this year is expected to be driven by government and private sector investment and consumption. At the same time, however, household consumption will be enfeebled by a significant increase in the cost of living, especially energy prices, and the CNB’s (Czech National Bank) tightening monetary policy. For next year, the government body expects economic growth to accelerate to 3.6 percent and the average inflation rate to fall to 4.4 percent. However, the ministry said the estimates are currently very uncertain, mainly because of the impact of the war in Ukraine. “On the one hand, the influx of refugees from Ukraine could ease labor market deficiency and weaken upward pressure on wages growth, but potentially unsuccessful integration could pose a significant social problem...

by Prague Morning Jun 04, 2022

Czech Republic Wants to Elevate Ukraine to Candidacy Status During its EU Presidency

On July 1, the Czech Republic will take over the six-month presidency of the EU Council, and the motto “Europe as a task” will then replace the current “We will sweeten it for Europe.” What the task is, the government has not yet revealed. In an interview with Czech news outlet Deník N, Minister for European Affairs Mikuláš Bek said that the Czech ambition for Ukraine is for the war-torn nation to become an EU candidate country. According to Bek, there is a second part to the new motto that will be released as a surprise on June 15. What is not surprising is the main task of the Czech presidency: confronting Russia’s aggression against Ukraine. The fallout from the invasion will likely continue to accelerate as debates surrounding the issue start turning into concrete proposals. “We want the process of Ukraine’s rapprochement with the European Union to move forward. I cannot say how realistic it is that the European Council will be able to reach an agreement in June on granting candidate status. I would very much like that, but there is still a certain divergence of views. If that does not happen in June, we will do everything...

by Prague Morning Jun 01, 2022

Woman Running for President? Economist Danuše Nerudová Declares Her Candidacy

Economist and former Rector of Brno’s Mendel University Danuše Nerudová has announced her candidacy for president. “I do so after considering all the pros and cons and with all seriousness. We need a head of state who has the ability and energy to stand on the side of the people in economically difficult times. We all deserve hope for better times,” Nerudová said on Twitter on Tuesday. Nerudová, who is 43, will start to collect the 50,000 signatures needed to officially register as a candidate. She highlights that, as a respected economist, it can help bring the Czech Republic out of the economic crisis. At the same time, she wants to improve the situation of the poorest. “I believe in a state where everyone, from young people to seniors, has the hope of a decent life,” said Nerudová. Czechs will be voting for the future head of state in a direct election at the beginning of next year. Former Czech Prime Minister Andrej Babiš and Petr Pavel, a former high-ranking Czech army and NATO official are regarded as the favorites, but they have not yet officially announced their candidacies. Earlier in May, trade union leader Josef Středula also began collecting...

by Prague Morning Jun 01, 2022

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