The spotlight has been put on serious European Commission reservations over Czech supervision of the way its funding is spent and administered as the Finance Ministry says it will not be seeking reimbursement of cash for two key structural fund programs until June. By then, Prague hopes to have satisfied Brussels with stepped up supervision which will deflect a much more damaging funding freeze.
Czech industry made a modest start to 2012 in January with output slipping from December’s levels but up on January 2011. New orders from abroad still appear strong, especially for the booming motor sector, alongside rising domestic demand.
The fallout from Eyjafjallajökull — the Icelandic volcano that spewed a cloud of ash from the British Isles to beyond the Baltics — is nothing compared to the political ramifications the ongoing trial of Iceland’s former prime minister could bring. Geir Haarde will go down in history as the first world leader to face criminal charges over the 2008 financial crisis that brought Europe to its knees. But will he be the last?
Czech PM Petr Nečas appears to have retreated from his more radical option for increasing the flow of income into state coffers, a unified VAT rate at around 20 percent. Instead, he is now talking up a more timid one percentage point hike in the exiting lower and higher rates.
The export oriented Czech economy came through January with flying colors and a record monthly trade surplus of Kč 29.6 billion as the traditional big earners abroad, cars and other machines, stepped up sales while imports, apart from fuel, were kept under control.
Czech Minister of Industry and Trade Martin Kuba (ODS) proudly unveiled his proposal for economic diplomacy to play a key role in boosting exports and diversifying sales abroad to reduce dependence on a struggling Europe. But he failed to get the foreign ministry on board beforehand — and it has a long list of complaints about allegedly major flaws in Kuba’s proposal.
Czech National Bank (ČNB) stress tests show the domestic banking sector is resilient to potential adverse shocks — such as a deeper recession in the European Union due to the eurozone debt cirsis — thanks to good capitalization, profitability and balance sheet liquidity, the central bank said in a report on Tuesday.
Confidence among Czech manufacturers has crept higher according to a monthly survey of purchasing managers in spite of a sharp drop in new export orders. Although production climbed, companies are continuing to lay off workers.
Leisure craft will be able to navigate a 100 kilometer stretch of the Vltava River from the Orlík dam all the way upstream to the capital of South Bohemia Český Budějovice, thanks to a project being implemented by the Czech Waterways Administration (ŘVC). The authority expects the navigable stretch of the Vltava to attract around 200,000 tourists a year.