Politics & Economics

Prague to Host Mayor NATO Meeting This May

US Secretary of State Antony Blinken is expected to attend an informal meeting of NATO foreign ministers in Prague in May, Seznam Zprávy reported. The news site said the size of the event was reflected in the CZK 100 million budget that had been set aside for it. The gathering will be the biggest NATO event in Prague since a summit in 2002 and comes as Czechia marks 25 years of membership and the alliance marks 75 years of existence. The foreign, defense, and interior ministries are set to contribute financially to the event. “We are operating with a budget of CZK 100 million, although the final amount is yet to be determined,” stated Foreign Ministry spokeswoman Mariana Wernerová to Seznam Zprávy. The Czech Foreign Ministry highlighted the nation’s commitment to NATO’s political cohesion, emphasizing the meeting’s symbolic importance in today’s global security context. “The decision to join the Euro-Atlantic structures and the subsequent anchoring of the Czech Republic in NATO represents one of the most historically important steps in the Czech Republic’s independent history. Its significance is truly appreciated today,” the ministry noted. The meetings will take place at the Czernin Palace, the Foreign Ministry’s seat, and at Prague...

by Prague Morning Feb 07, 2024

Czechia Takes a Step Closer to Euro Adoption with New Euro Commissioner

Czech Minister for European Affairs, Martin Dvořák (STAN), has appointed economist Petr Zahradník as the national commissioner for joining the European Exchange Rate Mechanism (ERM II) and adopting the euro. Renewing the position of the national coordinator for the euro has been under discussion within various government parties, spurred by President Petr Pavel’s New Year’s speech regarding the potential adoption of the common European currency. While the ruling parties – STAN, KDU-ČSL, TOP 09, and Pirates – are supportive, the Civic Democrats hold a negative stance. Zahradník, a specialized economist and analyst focusing on the European Union, has been appointed to encourage a public debate on the benefits and risks of adopting the euro, according to Dvořák’s press release. The new commissioner’s primary responsibilities include engaging in expert discussions on meeting the Maastricht criteria, monitoring and analyzing economic aspects of eurozone entry, and providing expert support to Dvořák. The minister’s press office states that the position is established for an indefinite period without additional financial costs, as Petr Zahradník already serves as an adviser to the minister. Dvořák expressed optimism, stating, “I believe that thanks to the new commissioner, we will be able to address main objections from the professional...

by Prague Morning Feb 05, 2024

Czech Koruna at Lowest Point in 20 Months Against Euro

At the close of trading on Friday, February 2, the Czech koruna weakened against the euro by 14 halers, reaching 24.97 crowns per euro, marking the lowest level since May 2022. Senior Czech central banker Jan Frait said he was prepared to back at least a 50-basis-point cut next week and may favour an even larger move, raising the prospect of the bank discussing bolder monetary easing than market predictions. Analysts highlight that the koruna’s decline is attributed to the overall instability in global financial markets and the news of a Czech economic recession. This downward trend commenced at the end of November last year, accumulating a loss of 71 halers over two months. It’s worth noting that the Czech crown reached its peak strength against the euro in July 2008, with an exchange rate of 22.86 crowns per euro. Its lowest point was in April 1999 when one euro was equivalent to 38.46 crowns.

by Shadia Oseni Feb 04, 2024

Czech Government Now Seeks to Build Up to 4 Nuclear Reactors Instead 1 to Reduce Price

The Czech government said Wednesday it plans to build up to four nuclear reactors instead of one as the country tries to become more energy-independent and wean itself off fossil fuels. Prime Minister Petr Fiala said the decision to seek more reactors could reduce the price per reactor by up to 25%. The timing and locations are not yet decided. Three companies including U.S. firm Westinghouse, France’s EDF and Korea’s KHNP originally submitted bids to build one reactor at the Dukovany nuclear power station. It should become operational by 2036. As part of their bids, the companies had also submitted unbinding offers to build three more nuclear reactors. In a surprise move, the government announced that Westinghouse’s bid didn’t meet the conditions of the tender, and only EDF and KHNP have been asked to submit new, expanded bids in April. Industry and Trade Minister Jozef Sikela said an assessment of the bids should be completed by the end of May. The Czech Republic already relies on six nuclear reactors to generate more than a third of its electricity. Besides four in Dukovany, state-controlled power company CEZ operates two 1,000-megawatt reactors at the Temelin plant. Unlike its western neighbors Austria and...

by Gabriella Burgess Feb 01, 2024

President Pavel Warns of Risks in Potential Trump-Putin Agreement

European nations must seriously consider the potential risks of Donald Trump winning the U.S. election and crafting an agreement with Vladimir Putin, which could be disadvantageous for both Ukraine and Europe, Czech President Petr Pavel said on Jan. 30. “It’s not about undermining transatlantic ties, it’s not about questioning the United States as an ally, but we have to realistically recognize that Donald Trump sees many things differently,” Pavel said. Ukraine, unlike Russia, currently has limited capabilities on the battlefield, he said. Therefore, the allies recommend limiting offensive actions and strengthening the defense. For this purpose, Kyiv needs not only purely defensive weapons but also weapons that can disrupt the supply routes of the Russian army, such as artillery, longer-range cruise missiles, and F-16 aircraft, stated Pavel. Trump repeatedly claimed that he would swiftly end Russia’s war against Ukraine within 24 hours if re-elected as president. Additionally, he expressed willingness to “allow” Russia to take over parts of Ukraine, arguing that Washington is providing Ukraine with excessive weaponry. Incumbent U.S. President Joe Biden officially announced in April 2023 his candidacy for a second term in the 2024 elections. Republican leader Donald Trump declared his candidacy for the 2024 White House...

by Prague Morning Jan 31, 2024

President Petr Pavel Advocates Euro Adoption for Czech’s Export Economy

In an interview with Czech Radio on Monday, President Petr Pavel underscored the advantages of the Czech Republic adopting the euro, emphasizing its advantages for the country’s export economy and the opportunity to actively shape the future of the eurozone. Pavel initiated discussions on euro adoption in the country during his New Year’s speech, calling for strategic steps to facilitate the transition. While Finance Minister Zbynek Stanjura (ODS) currently dismisses the need for immediate consideration, Pavel argues that the Czech Republic’s strong export orientation aligns it closely with eurozone countries. He suggests that actively participating in eurozone decisions, rather than passively accepting them, would be more beneficial for the nation. President Pavel also highlighted the Czech Republic’s efforts to meet the Maastricht criteria this year, a prerequisite for joining the eurozone. He proposed the establishment of a euro adoption officer within the government to demystify the euro debate, emphasizing the need for informed decision-making and long-term public education. Pavel urged a careful examination of other countries’ experiences with euro adoption, dismissing fears of potential drawbacks and encouraging a more objective understanding of the fundamental political decision ahead. Who’s in favour, who’s against The Mayors and Independents and the Pirate Party,...

by Cara McErlean Jan 30, 2024

Czech Lower House Approves Tougher Gun Law After Nation’s Worst Mass Shooting

The Czech Parliament’s lower house on Friday approved an amendment to the country’s gun law that tightens requirements for owning a weapon more than a month after the worst mass killing in the nation’s history. The legislation now goes before the Senate and if approved there must then be signed by President Petr Pavel before becoming law. On Dec. 22, a lone shooter killed 14 people and wounded dozens before killing himself at a Charles University building in downtown Prague. The assailant was a 24-year-old student who had a proclivity for firearms, with a license to own eight guns, including two long guns. Authorities said he had no criminal record and therefore did not attract the attention of authorities. Parliamentary debate on the legislation had already begun before that shooting. Interior Minister Vit Rakusan has said it was hard to speculate whether the new rules would have prevented it if they had been in effect before it took place. In the 200-seat lower house, lawmakers approved the changes in a 151-0 vote. If approved by the Senate, where the ruling coalition government has a majority, and signed by President Petr Pavel, it would then be possible for authorities to seize...

by Cara Stevenson Jan 26, 2024

Czechia Suggests Restricting Russian Diplomats’ Movement Across Schengen Zone

The Czech Republic asks the EU to consider restrictions on the movement of Russian diplomats across the Schengen area. Minister of Foreign Affairs Jan Lipavsky offered to include the restriction in the next package of EU sanctions targeting Russia. “Czechia proposes to establish the restriction of the movement of Russian diplomatic mission staff and their family members only to the territory of the state where they are accredited. It is not right for Russian diplomats to take advantage of Schengen area. We will do our utmost to ensure that our proposal is included in the 13th sanctions package,” Lipavsky stated. He added that Ukraine’s security is “linked” to Czechia’s security and providing military and financial support to Ukraine in its defense against Russian aggression is “a must”. The Czech Republic has proposed that Russian diplomats be issued visas and residence permits that only allow travel within their host country and not the rest of the Schengen area. Prague also proposed only accepting biometric passports, which are more difficult to forge. The ministers also endorsed the decision made by the European Commission to launch legislation screening in Ukraine and Moldova and prepare the framework for negotiations regarding the states’ accession to...

by Prague Morning Jan 24, 2024

EU Parliament Adopts Ceasefire Resolution for Gaza. Austria and Czechia Voted Against

European lawmakers on Thursday adopted a resolution calling for a permanent cease-fire in Israel’s war against Hamas, on the condition that the Palestinian militant group in Gaza be dismantled and that all hostages it holds be released. The conflict has divided European Union countries and political groups at the legislature, and reaching a consensus on the wording of the resolution was not an easy task. The original text underlined the need for a permanent cease-fire. It was adopted after an amendment tabled by conservative lawmakers was passed, insisting that Hamas needed to be dismantled for a cease-fire to happen and calling for the immediate and unconditional release of all remaining hostages. “Sustainable peace cannot exist as long as Hamas and other terrorist groups hijack the Palestinian cause and threaten the existence of Israel, the only democracy in the region,” Antonio López-Istúriz, an EPP lawmaker, said at the plenary. Responding to the resolution, a representative of the Israeli mission to the EU told Euronews that it shows the Parliament “has an understanding of the cause of the war and the means to end it.” “We are pleased that the resolution states clearly that a ceasefire is provided upon the unconditional release of...

by Prague Morning Jan 19, 2024

Despite Rising Prices, Polish Supermarkets Remain a Shopping Heaven for Czechs

Poland’s recent surge in prices hasn’t deterred Czech shoppers from flocking to popular Biedronka stores, known for accommodating trunk-sized loads, Novinky.cz writes. While the new year and a change in government have led to increased costs, Czech visitors are still drawn to Polish supermarkets for their larger purchases. Despite an unfavorable exchange rate of 5.8 Czech crowns to one Polish zloty, Biedronka stores near the Czech-Polish border continue to attract Czech shoppers. In the border town of Kudowa Zdroj, Czech license plates filled ninety percent of the supermarket parking lots, contrasting with half-empty stores in the neighboring town of Náchod. Although grocery bills are no longer just a few hundred crowns cheaper, savvy Czech shoppers are finding ways to save, utilizing the Biedronka app for discounts and factoring in increased fuel prices in Poland. Despite the looming disadvantageous exchange rate, Czechs are leaving Polish supermarkets with full shopping carts, taking advantage of promotions and discounts. Biedronka is responding to the price increase by strategically implementing promotions, often offering discounts on the second item. Loyalty app users benefit from additional discounts, ranging from thirty to almost sixty percent. Polish supermarkets maintain a zero VAT rate on essential items, but a return to...

by Prague Morning Jan 18, 2024

Czech Egg Prices Soar Despite VAT Reduction

There has been a notable increase in egg prices across Czech supermarkets. This price surge comes as a surprise, particularly in light of the recent three-percentage-point reduction in the value-added tax (VAT) on food items. Throughout December, supermarkets lured customers with discounted egg prices. However, these same eggs are now being sold at a higher cost per piece. The earlier Christmas promotions and current seasonal factors, including concerns about bird flu, are likely contributing to this unexpected price hike. According to the Czech Statistical Office, the average price of eggs in stores at the end of the previous year was 3.70 crowns each. Stores like Albert offered promotions, such as a pack of ten eggs for 29.90 CZK, a deal echoed by other chains. Following the New Year, the pricing has seen an increase, with Albert pricing the package at 48.60 CZK, Lidl at 43.50 CZK, and Penny at 46.65 CZK. At Billa, a pack of thirty eggs equates to a single egg price of 4.66 CZK. It’s not only consumers who are closely monitoring these prices; both the Government and the Czech National Bank had pledged a reduction in high inflation. However, the repricing efforts in January, along with...

by Karolina Kubičková Jan 17, 2024

Record Number of Self-Employed Individuals Cease Business in Czechia

In 2023, the Czech Republic witnessed a record-breaking 277,000 self-employed individuals terminating their businesses, marking the highest number since 1993, according to data from Imper. The trend is attributed to economic uncertainties, escalating costs and increased administrative requirements such as mandatory data boxes. Despite 68,000 entrepreneurs registering anew, mirroring the figures from 2022, the overall termination of businesses reflects a challenging economic environment. Last year, 14,000 limited liability companies and 4,703 foreign individuals ceased to exist. Associations that ceased to exist were 3,424, and individuals engaged in agriculture also significantly felt the impact with 2,836 entities ending their activities, a notable increase from 812 in 2022 The termination of businesses in 2023 almost matched the previous record set in 1993 when over 278,000 self-employed individuals ended their businesses. Factors contributing to this record include the dissolution of Czechoslovakia and the legislative prohibition of the “black system,” effective from that year onwards. Throughout the years, the number of terminated businesses varied in the tens of thousands, with exceptions like 2013 when nearly 150,000 self-employed individuals ceased their activities and the post-COVID year 2022. Tomáš Berger, the director of Imper, pointed out that the peak termination of activities occurred during February and...

by Cara McErlean Jan 16, 2024

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