Czech Minister of Agriculture Zdenek Nekula has told Czech Radio that former premier Andrej Babis’ Agrofert holding will have to return agricultural subsidies worth of up to CZK4.5 billion, and he indicated that more aid could be demanded back by other ministries. Nekula’s comments follow the European Commission officially concluding the probe into the billionaire’s conflicts of interest, sparked already by Babis’ first ministerial stint in the cabinet of Social Democratic PM Bohuslav Sobotka (2014-2017) and then his own 2017-21 government. During his time in government Babis’ agro-chemicals holding continued to claim subsidies for projects, despite the fact that, according to the EU, he still exercised effective control of the holding and was therefore in a conflict of interest. The EU has refused to reimburse the Czech government for money paid out to Babis while he was in a conflict of interest, leaving it to the government to recoup the misspent subsidies from Agrofert, the largest private recipient of subsidies in the country. Nekula expects Agrofert to object to his ministry’s move and braces for legal battles ahead. Agrofert is likely to build its case around the looser standards of ownership and consequently conflict of interests under the then-existing Czech legislation. Current opposition leader Babis and his...
Energy suppliers in the Czech Republic have already raised prices several times this year. Families living in houses that heat water, heat and cook with gas will feel it the most. According to experts, a household consisting of four people will have to prepare approximately 56,000 crowns more than they were used to just for gas bills. The worst situation is for families with children who live in a house and heat with gas. In a block of flats without gas, a family of four will pay an extra 11,000 crowns for electricity this year. However, if they live in a house and heats with gas, electricity costs will rise by 22,000 crowns this year, and even by 28,000 for gas. However, it is not only households with children that are at risk. “The most vulnerable category of customers are typically pensioners who live in a house heated by gas and who have not invested in that house for a long time,” said Karel Polanecký, an energy expert from Duha. According to experts, energy prices have still not reached their ceiling. For example, if a family of four uses gas for heating and water heating in their home and paid...
Construction sites, factory assembly lines and warehouses across central Europe are scrambling to fill vacancies after tens of thousands of Ukrainian men left their blue-collar jobs to return home after Russia invaded their country. Ukrainian workers had flocked to central Europe in the past decade – drawn by higher wages and aided by an easing of visa requirements – filling jobs that weren’t highly paid enough for local workers in construction, the automotive sector, and heavy industry. Many of these workers have returned home to help the war effort since Russia invaded on 24 February, abruptly worsening labour shortages in some of Europe’s most industrialized economies. Before the Russian invasion, Ukrainians were the largest group of foreign workers in central Europe. The Czech Republic hosted Ukrainian workforce of around 200,000 respectively, according to industry trade groups. “The loss of Ukrainian workers has deepened the problems companies are facing,” Radek Spicar, vice president of the Czech Federation of Industry, told Reuters. “Companies say they can’t cover all the demand from business partners: they deliver with delays and pay penalties.” Before the Russian invasion, Germany-based recruiter Hofmann Personal had more than 1,000 Ukrainian candidates due to arrive in the Czech Republic between...
The Czech Republic’s gas stores are 80% full, Prime Minister Petr Fiala said on Monday, as the country and other European Union member states continue to boost storage to protect against risks of a halt to Russian supplies. The EU aims to have gas storage facilities across the bloc 80% full by Nov. 1, but its efforts have been hit by temporary outages or reduced capacity via Nord Stream 1, a major pipeline carrying Russian gas to Europe. Fiala said in a Twitter post that Czech gas storage levels were at a record level. “We are working to be as well prepared as possible for the winter,” he said. Deliveries of Russian gas via the Nord Stream 1 pipeline have now been limited to 20 percent. The annual gas consumption in the Czech Republic is about 9.4 billion cubic meters and the country gets about 98 per cent of its gas from Russia. The Czech Republic was nearly fully dependent on Russia for gas before Moscow’s invasion of Ukraine in February pushed it to seek alternative supplies. Industry Minister Jozef Sikela said last week the country had secured 3 billion cubic meters of annual gas capacity – roughly a third...
No one who’s keen on eating out has missed the fact that they have to dig deeper into their pockets when visiting the restaurant. However, the willingness to pay more and more for lunch has begun to decline. Since the beginning of this year, the price of lunch has been rising by one or two crowns every month. The costs of running restaurants are rising and their owners cannot afford to bear them all. The margin in the catering sector is very sensitive to any cuts. The average price of lunch in June reached CZK 160.20, 10.1 per cent more than a year ago. And it seems that this is an amount that for many Czechs represents the ceiling of financial possibilities. Data from the Czech Statistical Office and the Ticket Restaurant Card Index show that prices in restaurants increased by 23.5 percent year-on-year in June. At the same time, however, the gap between the amount spent and how much food costs is increasing. Thus, in May, restaurant prices rose 11.6 percent faster than spending; in June, the gap was already 13.4 percent. Which means only one thing – guests are choosing cheaper items from the menus, denying themselves salads...
The European Commission found conflicts of interest in the distribution of EU funds, and as a result, Czechia will have these amounts deducted from future subsidies. The European Commission investigated the allocation of subsidies to non-eligible entities, including some linked to former Prime Minister Andrej Babiš, Regional Development Minister Ivan Bartos from the Pirate party, said on Thursday, according to the Czech News Agency. In an investigation spanning some three years, the Commission found several unlawful examples, including disbursement to a bakery from Agrofert, which Babis transferred to trust funds to meet the Czech conflict of interest law. The firm was given a subsidy of €4 million for constructing a bread assembly line that did not meet the innovation criteria. Czech ministries will now have to enforce the return of such subsidies from the recipients, which could result in litigation. Bartos said he expected the ministries to enforce the return of such subsidies, which may lead to court proceedings. Rather than returning the money to the Commission, Czechia will get less in the next period when other subsides are approved, as those allotted unlawfully will be deducted from their volume, Bartos said. “It will be up to our institutions to gain...
The ministers of foreign affairs of Austria and the Czech Republic, Alexander Schallenberg and Jan Lipavsky, have visited Irpin, city mayor Oleksandr Markushyn has said. The visit is to signal continuing EU support for Ukraine in the war waged by Russia and ascertain the country’s needs at the present time. “We are especially honored to welcome such guests, since Irpin receives a noticeable assistance from Austria and the Czech Republic. Thousands of Irpin residents have found safe shelter in these countries. In addition, Austria has started providing us with its support for the recovery of the city,” he said on the Telegram channel. On behalf of the entire community, the mayor thanked both ministers for their clear position and comprehensive support for Ukraine and its people. Markushyn said on July 18 that 70-75% of Irpin’s residents had already returned to the city. The Czech Foreign Minister also paid a visit to the town of Irpin and the Hostomel air base, which were the scenes of fierce fighting at the beginning of the Russian invasion of Ukraine. Thousands of Ukrainians lose automatic right to health insurance in Czechia Thousands of Ukrainians in the Czech Republic will lose the automatic right to...
It is time for Czechia to reconsider its foreign policy towards Russia with relations expected to be strained for at least 10 years, Czech Foreign Minister Jan Lipavský said at a meeting of the Foreign Affairs Council on Monday. He is not alone in his position, but the idea that EU member states would abolish the right of veto in a unified foreign policy seems unrealistic to him. “Relations with the Russian Federation will be relatively tense for at least the next decade,” the head of Czech diplomacy said following the meeting. “Europe must be able to reflect this. It must be able to defend itself. The still-accepted starting points assume completely different relations with Russia,” he added. Lipavský already announced before the start of the negotiations that he intends to propose a complete redefinition of relations with Russia to his European counterparts. It was clear from his words that he wishes for the European Union to adopt a unified position on this issue and that individual countries do not deviate from it. “It is time to rethink our policy towards Russia. We have to build new measures against it to stop the war and prepare ourselves for new atrocities that Russia...
As many as 15 new brands arrived on the Czech retail market in the first six months of this year. Compared with the first halves of the past few years, this is the highest number since 2018, when multiple newcomers were attracted as a result of an outlet centre opening near Prague’s airport. The number of newly arriving brands in the second half of the year has been traditionally higher than in the first half, mainly as a result of the Christmas season. In effect, the number of newcomers this year can be expected to be similar to last year’s 38. “The Czech retail market remains attractive for international brands; it is often the first one in the Central and Eastern European region where they test their performance. The coronavirus pandemic has not changed anything about that – now that the restrictions have been lifted, customers are largely returning to shopping in physical stores and the local purchasing power is attractive for the brands,” said Jan Kotrbáček, Partner & Head of CEE Retail Agency team, Cushman & Wakefield: French and fashion brands first and foremost Four brands arrived from France, two from Slovakia, and one each from the other countries...
On the evening of Thursday, July 14, the lower house of the Czech Parliament approved the bill on the so-called “economical tariff.” This is a program to help residents pay bills for electricity and gas in the new heating season. All the MPs present voted in favor. The program envisages that the state will compensate all household consumers with up to CZK 16,000 for energy costs. In an earlier version, the bill only assisted with electricity and gas, but the deputies added to it also heating. The Government will determine the exact amount of compensation for specific cases by a separate decree. This is expected to take place in early August. Compensation will be provided automatically in the form of a discount. Residents will not have to file an application or additionally ask about it in another way – the energy companies will independently conduct the recalculation and resolve all issues with the state directly. However, compensation will not apply to temporary residences (e.g. cottages) and tariffs that include recharging points for electric vehicles. “People will see the results in their invoices from October 1. The support will be valid for the whole heating season,” stated the Minister of Industry...
Czech inflation jumped to a fresh three-decade high in June, hitting a rate of 17.2% year-on-year and posing a challenge to pledges of interest rate stability from a new central bank governor after sharp policy tightening over the past year. The rise in inflation, which is at its highest rate since 1993, was above the 17.0% expected in a Reuters poll. With price growth soaring since last year, the Czech National Bank (CNB) has lifted its key interest rate CZCBIR=ECI by 675 basis points, to 7.00%, since June 2021, trying to anchor inflation expectations. Other central European policymakers have also increased borrowing costs amid price pressures from both external issues such as supply chain problems and fast-rising energy prices in the wake of Russia’s invasion of Ukraine and local factors like tight labour markets and increasing wages. But a change of guard on the bank’s seven-member board has led many analysts to predict an end to the policy tightening cycle. New governor Ales Michl, a board member since 2018 who has opposed rate hikes over the past year, pledged rate stability when he was appointed in May. “Inflation is not only moving away from the CNB’s target but also its...
Germany and the Czech Republic on Monday signed a joint declaration, pledging to overcome Russian fossil fuel dependency and to accelerate the transition to low carbon energy as falling Russian gas imports threaten security of supply across Europe. Also on Monday, the biggest single pipeline carrying Russian gas to Germany began annual maintenance, with flows expected to stop for 10 days, but governments, markets and companies are worried the shutdown might be extended because of the war in Ukraine. “We are going to finalise the agreement on solidarity measures to safeguard the security of gas supply between our countries prior to the start of the upcoming winter season,” the declaration read. German Economy Minister Robert Habeck, on a visit to Prague, and Czech Industry Minister Jozef Sikela said it was necessary to prepare for various options, including that deliveries through the Nord Stream 1 gas pipeline would not resume when scheduled maintenance is due to finish on July 21. “European solidarity is more important than ever in the current energy crisis. This also includes closer coordination between direct neighbours,” explained Habeck.” Already, Christian Kullmann, president of the chemical industry association VCI, has called for the securing of industrial gas supplies...
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