Prague is the third richest region in the EU: only Luxembourg and the south of Ireland have topped it
According to analysts, the location of the Czech capital is due to the longer-term catching up of the Western world, and people who commute to Prague for work are also to blame.
But the inhabitants of the regions do not have to envy those from the capital. “It’s not about the wealth of the people who live in the region. But about the wealth that will be created there, and at the same time about the wealth that companies create in a given territory, ” Trinity Bank chief economist Lukáš Kovanda explained in an interview for iDNES.cz.
According to J&T Banka analyst Pavel Ryska, Prague came in third place also because the whole of the Czechia has been on the heels of Western European countries for a long time. “In the last five years, or rather before coronavirus, the Czech economy has grown faster than the EU average. Prague has thus caught up with Western cities, ” says Ryska.
Kovanda mentioned the current data of the International Monetary Fund (IMF), according to which the Czechia last year surpassed Italy and Spain in terms of GDP per capita. And it should be even better! The forecast states that in 2025, the Czech Republic will surpass the economic performance of Japan and New Zealand.
“Wages are rising here, as is the purchasing power of the people. our model, the famous Germany, we still haven’t caught up and we won’t catch up. But we manage to download videos of other Western economies, especially the southern ones, ” Kovanda added.
We are fleeing not only from the selected states of southern Europe, but also from Slovakia, which has long been given to us and other Central European countries as a model as a place with a great economy. Obviously, this is no longer the case.
“Unlike in Slovakia, for example, there was no such slowdown in foreign direct investment after the last crisis, ie after 2009. The inflow of capital from rich countries continues.” said Kovanda. Bratislava is now in 13th place in the Eurostat rankings, although in 2013 it finished ahead of Prague and placed 4th.
Prague will probably not reach the first place for a long time and it is not only because the coronavirus pandemic has significantly affected the economy.
“Luxembourg has long been one of the financial centers. There are a number of funds, a bank and other financial institutions. ” J&T Banka analyst Pavel Ryska commented on his position for iDNES.cz. “Southern Ireland, on the other hand, is popular with many American firefighters because it’s tax-efficient there.” he added.
“Microsoft, Apple, Alphabet and Facebook have a European base in the south of Ireland. In addition, the region of southern Ireland is not densely populated, so the wealth created by large American companies is budgeted among a relatively small number of people. ” economist Lukáš Kovanda said, adding that the wealth produced in Ireland did not warm up for very long.