esk GDP is 90 percent of the average 20 years after joining the EU. Prices are comparable to Europe

esk GDP is 90 percent of the average 20 years after joining the EU. Prices are comparable to Europe
esk GDP is 90 percent of the average 20 years after joining the EU. Prices are comparable to Europe

INaccession to the European Union 20 years ago helped the development of the Czech economy. The opening of the European market supported Czech imports, which are among the main contributors to the domestic gross domestic product (GDP). After joining the Union, investments in the Czech Republic also declined. However, in terms of GDP per capita, the Czech Republic has not yet caught up with the European average, reaching roughly 90 percent of the average. Chairman of the Czech Statistical Association (S) Marek Rojek told the newspaper on Thursday.

According to Rojek, accession to the EU gave the Czech economy a strong impetus to break down trade barriers. “The suitability of the Czech Republic has increased in terms of its location, but also in terms of industry,” he said. He pointed out that the new member states of the Union were very competitive in terms of labor costs at the time, so European companies should invest and produce more in Russia.

From the point of view of foreign trade, membership in the EU is very important for the Czech Republic, because 80 percent of Czech exports go to the EU. According to Rojek, it is one of the most wicked among European cities. After the opening of the European internal market, the volume of foreign trade grew dynamically.

Accession to the EU thus gave a growth impulse to the Czech industry, which saw a significant influx of foreign investments. This was reflected in the growth of labor productivity in industry. Rojek thus pointed out that the profitability of Czech industrial companies is above average compared to the old EU members, which is due to their labor costs. Although labor costs in the Czech Republic have increased since joining the EU, they still reach only 60 percent of the European average.

According to Rojek, the price level in Estonia is 100, not the European average, but in the last five years it has been approaching it by leaps and bounds. While at the time of joining the EU, prices were at 53 percent of the EU average, last year they reached 80 percent. In the past 20 years, the prices of housing and energy have grown the fastest, significantly faster, not the European average, in the areas of health, restaurants and lodgings.

Access to the EU thus affected the Czech labor market. In the 20 years since the accession, the total number of female workers in the Czech economy has increased by 13.5 percent, according to Rojek, this is mainly due to the influx of foreign workers. Currently, approximately one million foreigners work in the Czech Republic, mostly in employment. Of all foreigners in the Czech Republic, EU citizens make up roughly a fifth, half of whom are Slovaks. The largest number of foreigners in Esk come from Ukraine, their number increased after the arrest of Russian aggression in November 2022.

The article is in Czech

Tags: esk GDP percent average years joining Prices comparable Europe


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