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Tag: Czech Republic

  • Czechia: Former President Klaus refutes allegations about sending money to Soviet Union

    Former President Václav Klaus called articles claiming that he had secretly sent a $1.3 billion (€1.06 billion) loan to the Soviet Union in the early 1990s as an “unbelievable handful of lies”. Klaus considers the article of the Hospodářské noviny daily a planned attack on his person, possibly with the aim of blocking his possible return to politics.

    The money borrowed on the basis of an agreement concluded by the communist government of Ladislav Adamec became part of a multi-billion debt, of which Russia returned only a fraction to the Czech Republic. The Hospodářské noviny daily, in collaboration with several other news outlets, points to documents from the National Archives.

    In April 1989, Zdeněk Rachač, an official of the Czech Ministry of Finance, proposed to provide a billion-dollar loan to the Soviet Union. The proposition was then approved by Adamec’s government. In November of the same year, however, the communist regime fell, and on Dec. 10, the cabinet of Marián Čalfa, in which Klaus was minister of finance, took over the government.

    “I don’t remember this loan to the Soviet Union. I didn’t and still don’t know much about this loan, concluded on Nov. 10, 1989, one month before I became minister of finance,” Klaus said.

    “Long before I took office, the then Czechoslovak government approved the loan, which was supposed to ensure that the Soviet Union could continue to buy our goods even in the absence of transferable rubles and focused mainly on the sale of engineering products. It was not a secret conspiracy act,” he noted.

    Klaus added that Rachač was one of the thousand officials in the Ministry of Finance. He stressed that he did not select his employees after the fall of communism and taking office.

    According to the Hospodářské noviny daily, there is a letter from December 1989 in which Klaus, as the minister of finance, was warned against sending the loan to Russia by the then director of the Czechoslovak Commercial Bank (ČSOB). According to Klaus, however, the daily distorted the correspondence. The letter only concerned the possible loss that the bank could suffer.

    “At that time, we were very strongly connected to the Soviet Union economically. We totally depended on Soviet raw materials, oil, natural gas, iron ore. (…) It was, of course, necessary to continue a certain elementary type of economic contact,” said Klaus.

    After 1989, Czechia tried to recover the debt from Russia, which overall reached $3.6 billion (€2.94 billion). While Miloš Zeman served as the prime minister, a private company bought about two-thirds of the debt from the state.

    In August 2013, the government of Prime Minister Jiří Rusnok approved an agreement with Russia to repay the remaining debt. According to Rusnok’s statement at the time, Czechia was to obtain approximately 80 percent of the rest of the debt, i.e., at least $6.5 million (€5.3 million). Before Christmas 2013, the Russian Ministry of Finance announced that the debt to the Czech Republic had been repaid through supplies of industrial production and partly by money.

    Title image: Václav Klaus giving a statement on the allegations of the Hospodářské noviny daily (Václav Klaus Institute)

  • Czechia to once again have a new health minister

    On Tuesday, 48 days after being appointed, Minister of Health Petr Arenberger announced his resignation after he faced criticism for submitting incorrect information about his property.

    Prime Minister Andrej Babiš stated that Arenberger would be replaced by one of his predecessors, Adam Vojtěch, who ran the office in the first months of the coronavirus epidemic and left the government last September.

    President Miloš Zeman appointed the “old-new” minister on Wednesday. Since the start of the epidemic, this is the fourth change at the head of the health ministry.

    While opposition politicians criticize Vojtěch’s return, some representatives of the medical community welcome the comeback, saying that Vojtěch already knows the office and proved himself as the health minister.

    At a press conference on Tuesday morning, Arenberger said that the only mistake he made was incorrectly filling out his asset declaration. According to Arenberger, he has been experiencing a “media lynching” in the last week. The media reported that he owns over 160 properties, doubted the lease of one of them to the Vinohrady hospital, and wrote about millions of korunas he gained in profits from clinical studies.

    “I pay taxes properly, and my tax returns are in order. Unfortunately, I filled in the asset declaration incorrectly, thus creating space for creative speculation,” stated Arenberger.

    He had previously apologized for the mistake, which he said was only a misdemeanor. According to Babiš, Arenberger decided to resign due to pressure on his family.

    The Czech prime minister also added that he talked to Vojtěch about a possible return to the government last week. He hopes that Vojtech will lead the ministry until the resignation of the government after the October elections.

    Vojtěch became minister of health in December 2017 when he was 31 years old. He resigned last September, stating that he had been overly burdened by managing the ministry during the first wave of the pandemic. He also faced criticism for allowing the summer easing of coronavirus measures, thus paving the way for the rapid onset of the second, much more tragic wave of the epidemic.

    He was replaced by epidemiologist Roman Prymula, who resigned after photographs of his visit to a restaurant that should have been closed under government restriction appeared. At the end of October, he was thus succeeded by pediatric hematologist Jan Blatný. He left the office in early April after criticism from the prime minister and the president. While Babiš questioned his lackluster approach to new Covid-19 drugs, Zeman reproached him for refusing the use of the unapproved Sputnik vaccine.

    Title image: Czech Republic’s Health Minister Adam Vojtech speaks with the media as he arrives for an extraordinary meeting of EU health ministers in Brussels to discuss the Covid-19 virus outbreak, Friday, March 6, 2020. Fearing a possible shortage in medicine and protective masks, health ministers from the European Union are trying to boost their collective response to the novel coronavirus outbreak during an emergency meeting. (AP Photo/Virginia Mayo)

  • Czechs face most difficult path in Europe to buy an apartment

    In Europe, the road to obtaining an apartment is the most difficult in the Czech Republic. It was difficult before the pandemic, and it would seem to be even more difficult now. Prices of apartments and houses in Prague and other larger cities are soaring.

    According to the Property Index study of the Deloitte consulting company, Czechs need to work 11.4 years for an average salary to purchase their own apartment with an area of 70 square meters.

    Germans will reach comparable housing in 5.1 years, Poles in 7.7 and Hungarians in 7.6 years. The situation in Prague is even more acute. In the unavailability of housing, neighboring Austria is getting close to the Czech capital, where ten annual average salaries are needed to purchase an apartment, and Slovakia, where it is 9.9 salaries.

    The latest data on apartment prices are from the third quarter of last year. Prices continued to rise sharply despite the coronavirus pandemic. The price of houses and apartments rose by 4.9 percent in a year. Real estate prices are thus growing even faster than prices of goods and services, which rose by 3.1 percent. It is the fourth-highest price increase in the entire European Union at the time of the pandemic. The average price of a square meter apartment is 70,300 korunas (€2,758). The apartment with an area of 70 square meters will cost almost 5 million korunas (€196,200).

    Build, build, build

    The Covid-19 pandemic has further exacerbated trends that have long affected the housing market. Wages in the country have risen despite the economic downturn. However, shops were closed, the services did not work. It was impossible to travel. The only option was online shopping – and it was growing rapidly.

    But overall, people spent much less and increased their savings. And as the government began to accumulate huge debts, prices shot up. People have begun to fear that inflation will devalue their money, and they started looking for a way to save it safely. And real estate in the Czech Republic, where people are not used to taking too much risk with their money and investing in stocks, for example, is a very safe and at the same time profitable appreciation of savings.

    Moreover, with rising inflation, it is increasingly likely that the Czech National Bank will raise interest rates, making mortgages more expensive, which has left people wanting to buy houses and apartments while they are still low. Czechs have long been one of the countries where a large part of the population lives in their own apartments and long for them. At the same time, compared to other countries, there are not enough apartments and little construction. All this together is the perfect constellation for soaring property prices and the least affordable housing in Europe.

    There are 460apartmentsper thousand inhabitants in the Czech Republic. This is below the European average. In neighboring Germany, it is 511.8apartments, in Austria 541, and in Italy 581. Portugal has the most apartments and houses per thousand inhabitants at 582. It is no coincidence that this country, which is now much poorer than the Czech Republic, has the most affordable housing in Europe. A Portuguese with an average income needs four annual salaries for an average apartment of 70 square meters. The Czechs have to work for the same apartment for the aforementioned 11 and a half years. The relationship between the number of apartments and their availability is visible at first glance. Therefore, real estate prices in the Czech Republic are growing at an above-average rate by European standards.

    The poorer the country, the more people own an apartment

    The European comparison also clearly shows how insufficient the construction in the Czech Republic is. Last year, an average of 3.62 apartments per thousand inhabitants began to be built. In Poland, where housing is significantly more affordable, it was 6.18 apartments, and in France 6.12. The good news is that construction is accelerating at least a little.

    The numbers of people living in their own houses and apartments vary considerably across Europe. The poorer the country, the more people live in their houses and apartments.

    In general, the rich west and north of Europe have far more people renting apartments than the poorer east and south of the continent. In the European Union, 69.7 percent of people live in their own apartments and houses on average, with the most in poor Romania, where it is 95.8 percent. It is followed by Hungary with 91.7 percent and Slovakia with 90.9 percent. Except for Malta, only the post-communist countries of Central and Eastern Europe are among the largest owners of property. The history of many years of foreclosure might be one of the reasons why so many people live in their own houses in this part of Europe.

    At the opposite end, there are the richest countries in Western Europe. In Switzerland, only 41.6 percent of people live in their own house or apartment, 51.1 percent in Germany, 55.2 percent in Austria, and 60.8 percent in Denmark. The richer the country, the fewer owners. These are all countries where, unlike Central Europe, the housing market works well. It is the lively, competitive market that significantly decides when young people move away from their parents. In rich Western and Northern Europe, children move out from their parents many years earlier than in the poorer central and southern parts of the continent.

    The result of all these trends is soaring house and apartment prices. They have risen by 59.5 percent since 2015. The average salary in the economy rose by only 51.5 percent over the same period. Therefore, housing in the Czech Republic is far less available from year to year.

    Title image: In this picture taken Tuesday, Oct. 3, 2017, a woman walks past a new apartment building that is being constructed in Prague, Czech Republic. The Czech Republic’s capital has the hottest residential property market in Europe, and it’s becoming a problem. (AP Photo/Petr David Josek)

  • Opinion: Can the Visegrad Four last?

    The issue surrounding the border dispute over the Turów mine has revealed the frailty of the Polish-Czech alliance. The crisis between Warsaw and Prague is heating up instead of cooling down. Just the fact that there actually is a crisis proves that there is a lack of trust.

    Despite constant meetings between heads of government and despite the declarations of closeness, Poles did not understand how serious of an issue for their ally they were dealing with. Poles do not understand how crucial the topics of water and environment are and that they create huge emotions among local populations.

    It had seemed that a few days after the exposure of the affair involving Czechia’s complaint to the European Court of Justice (ECJ) that both sides managed to work out an agreement — one more beneficial to Czechia because its court complaint turned out to be effective. According to Mateusz Morawiecki, this was meant to have happened at the level of the prime ministers, but then Andrej Babis came out and denied any deal had been struck.

    This all took place during the highly observed EU summit in Brussels which made it so our bilateral crisis sailed into deep international waters.

    The crisis may last, as it has promising potential for internal party struggles in both countries. Turów has become the subject of the campaign prior to Czech elections which will take place in the fall. Meanwhile, the approach to the ECJ had already been dividing Poles and now the issue of Poland’s energy future has joined the picture, which has much potential to fuel the conflict between PiS and the opposition. Moreover, national pride on both sides of the border remains a huge factor.

    How is it possible that the paths of Czechia and Poland split apart so much? After all, Czechs have held first place in surveys concerning Polish sympathies towards other nations. Czechia is Poland’s most important trade partner, apart from Germany.

    There had been problems in the past: the export of Polish food fell victim to the industrial salt affair which ended up in meals instead of melting snow on streets. Czech producers and politicians eagerly used the incident to limit competition and ‘Made in Poland’ is not as well-received in Czechia as we would like. Poland and Czechia also have similar strategic goals, and they have the most in common in the V4 when it comes to security.

     

    “Of course, we’re still in the middle of a deep crisis, but the responses about long-term life evaluation did not change decisively, though the disruption in our lives was so profound,“ added Sachs, who said people had shown great resilience over the past year.

    The report evaluates 149 countries around the world based on factors such as gross domestic product, life expectancy, level of corruption, social support, or personal freedom. Due to the pandemic, the authors of this year’s report conducted surveys in less than a hundred countries, the evaluations of other states are based on estimates from earlier data.

    European countries eventually occupied nine of the top ten, with only New Zealand wedging in. Finland again proved to be the happiest country in the world, followed by Denmark, Switzerland, Iceland, and the Netherlands.

    Among Visegrád Four countries, Czechia has the happiest citizens, according to the report.

     

    In recent years, Czechia has been steadily rising in the rankings. In 2016, it was in 27th place, a year later 21st, and the year before 20th. Slovakia finished 34th this year, jumping from 37th place last year. On the contrary, Afghanistan, Zimbabwe, Rwanda, Botswana, and Lesotho proved to be the least fortunate countries.

    According to an economist from Columbia University Sachs, the residents of northern European countries have long been the most satisfied. They are placed regularly on the front rungs.

    “People feel secure in those countries, so trust is high. The government is seen to be credible and honest, and trust in each other is high.”

  • Covid-19 epidemic slows in Czechia, but hospitals are still dangerously stretched

    The coronavirus epidemic in the Czech Republic continues to slow down, with laboratories in the country detecting 5,443 infected on Saturday, about 1,500 less than a week ago. The reproduction number also dropped again, which is now at its lowest level in two months, however, the capacity of hospital beds is still strained.

    The reproduction number indicating the average number of other people infected by one person with a positive test dropped from 0.87 to 0.85. If the reproductive number was higher than one, it would mean that the epidemic is accelerating again.

    Despite the declines, the capacity of hospitals remains almost exhausted, but even in this case, the situation is slowly improving. As of Saturday, there were 8,168 patients positive with coronavirus in hospitals, a decrease of almost 600 hospitalized compared to Friday. At the beginning of the week, there were more than 9,400 Covid-19 patients in hospitals, however, the number of people with a severe condition is declining much slower. There were 1,970 on Saturday compared to 2,054 at the beginning of last week.

    By Sunday morning, 12 percent of the beds in the ICU wards in Czech hospitals were vacant, and 124 were intended for Covid-19 patients. The worst situation is in the Karlovy Vary region, where there are three beds available in these wards, one of which is for patients with coronavirus. There are 24 percent free standard oxygen beds in the Czech Republic, which means 907 free places in Covid-19 wards.

    Since the outbreak of the epidemic last year, 1.5 million people in the Czech Republic have been infected with coronavirus. According to the ministry, there should currently be approximately 232,400 infected people in the country, most of them with a mild course of the disease.

    In a week-on-week comparison, the daily increments of newly infected people have been declining since Tuesday. This was particularly pronounced on Friday when the difference was about 5,300 cases. Since the beginning of this week, there have been 62,435 newly diagnosed coronavirus patients in the Czech Republic.

    The PES epidemic risk index is at 68 points the second day and has remained in the fourth of five alert levels for almost two weeks. In addition to the reproductive number, the other three indicators for calculating the score also improved — the average number of infected per hundred thousand inhabitants in two weeks, the fortnightly average of infected among seniors, and the proportion of hospitalized who were diagnosed with Covid-19 after their arrival in the hospital.

     

    Today at noon, bells across the Czech Republic rang and the country paid homage with a minute of silence to almost 25,000 victims of the pandemic. A group of activists also painted 25,000 crosses on the Old Town Square to remember the victims and to point out the alleged government’s failure in responding to the crisis.

    Although the lockdown was to last three weeks, the pandemic’s decline is only gradual. The current measures, therefore, remain in place and the government will ask the Chamber of Deputies to extend the state of emergency once again, this time until April 11 at least.

    Title image: Health care workers assist COVID-19 patient during a transport from an overrun hospital in Ceska Lipa, Czech Republic, Thursday, March 18, 2021. (AP Photo/Petr David Josek)

  • VIDEO: Much like humans, chimpanzees are now connecting over Zoom

    Czech zoos are closed due to coronavirus measures and that means animals are lacking interaction with visitors, including the chimpanzees at the Brno Zoo. 

    In order to help alleviate the boredom, the chimpanzees at Brno Zoo can now have fun via an online stream with their counterparts from the Safari Park Dvůr Králové. The chimpanzee videoconferences on Zoom immediately proved to be both popular and attracted the attention of foreign media outlets around the world. 

    “We used the idea and the initiative of enthusiasts from Brno, who installed large screens in both zoos and thus connected the two chimpanzee groups. It is a new and interesting stimulus for these very intelligent animals,” said Martin Hovorka, director of the Brno Zoo.

    Mariana Hubíková, a breeder of chimpanzees at the Brno Zoo, stated that the chimpanzees already belong to the group of animal seniors, but they will be interested in any novelty.

    “Sometimes they come in front of the screen to show each other food, or I noticed how chimpanzees from Dvůr Králové watch me while I clean the enclosure,” said Hubíková.

    Animals in zoos are deprived of the attention of visitors due to coronavirus measures, which was the inspiration for the authors of the idea of ​​Pavel Cupák and Petr Vídeňský.

    “Pavel was inspired by news that some animals in the zoo may be bored at this time, and it occurred to him to at least partially replace the missing visitors. Therefore, I contacted the director of both zoos, and as part of the trial run, we first connected the chimpanzees with children in the kindergarten,” said Vídeňský.

    People can watch chimpanzees live every day via a YouTube channel between 8 a.m. and 4 p.m. The online stream will be up until the end of the month.

  • Prague comes behind Warsaw and Bratislava in ranking of financial centers

    In the ranking of world financial centers, Prague placed behind Warsaw and Bratislava, as it fell ten ranks to 76th place. New York, London, and Shanghai remain in the lead, according to a study published by the Global Financial Centers Index (GFCI) based on research from the China Development Institute (CDI) in collaboration with the London-based consulting company Z / Yen Partners.

    CDI and Z / Yen Partners surveyed 126 financial centers and eventually ranked 114 in the 29th edition of the index. The placement is determined by 143 criteria provided by third parties, including the World Bank, the Economist Intelligence Unit (EIU), the Organization for Economic Co-operation and Development (OECD), and the United Nations.

    Of the Central European capitals, Warsaw did the best this year thanks to its 61st-place ranking, but it also lost four places compared to the last edition. Bratislava came in 66th place but advanced 21 places higher than last year. Budapest was the worst in 85th place, although it also jumped 16 places ahead.


     

    Regarding European cities, in addition to London, Frankfurt am Main and Zurich also made it to the ten most competitive financial centers. They placed ninth and tenth.

    Title image: This picture taken March 6, 2013 shows the Zizkov television tower peaking over the skyline of Prague, Czech Republic. Following its completion in 1992, the 216-meter (236-yard) tall television tower in the Czech capital has become a dominant landmark of the city skyline that offers a breathtaking view of Prague from its restaurant and observation desk. (AP Photo/Petr David Josek)