On the contrary, about the inhabitants of Prague, whose standard of living or economic possibilities statistics do not seem to indicate. “It’s not about the wealth of the people who live in the region. But about the wealth that is there and at the same time about the wealth that companies based in the given area create, “Lukáš Kovanda slows down the main economy of Trinity Bank, what the published data are about.
According to Eurostat, the location of Prague can be explained by the high number of people who travel to Prague for work but do not live there. “For example, the inhabitants of Benešov commute to Prague for work and there is some value that will be calculated among the people of Prague,” adds Kovanda.
Gross domestic product per capita in EU regions. Data are shown as a percentage of EU risk. According to the GDP per capita indicator, blue regions are the richest.
According to Pavel Ryska, an analyst at J&T Banka, these are not just crowds of commuters. Every morning, people from the surrounding area travel to Vienna, Austria, or Hamburg, Germany, for work. However, the named cities ended up in the ranking behind Prague. So what is it?
According to Ryska, Prague won third place, among other things, because the entire Czech Republic has long been on the heels of Western European countries. “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. “Convergence not only of Prague but also of the Czech Republic is really taking place.”
We still haven’t caught up with our role model – the famous Germany, and we just won’t catch up. But we are succeeding in pulling the edge of other Western economies, especially the southern ones.
Lukáš Kovanda Trinity Bank’s main economy
In this respect, recently published data from the International Monetary Fund (IMF), according to which the Czech Republic surpassed Italy and Spain in terms of GDP per capita last year, will disappear. The IMF forecast even claims that in 2025 the economic performance of the Czech Republic will surpass Japan or New Zealand.
Prague scored in the ranking of the greenest cities. It doesn’t surprise me, says the councilor
“Wages are rising here and with it the purchasing power of people. We still haven’t caught up with our role model – the famous Germany, and we just won’t catch up. But we are succeeding in pulling the lead of other Western economies, especially the southern ones, “adds the economist.
Kovanda mentions another factor which, according to him, contributed to the location of the Czech Republic, namely foreign investment. “Unlike, for example, Slovakia, there is no such slowdown in foreign direct investment after the last crisis, ie after 2009. The inflow of capital from rich countries continues,” says Kovanda. Bratislava is now in 13th place in the Eurostat rankings, yet in 2013 it finished ahead of Prague and placed fourth.
Luxembourg has long been one of the financial centers. There are a number of funds, a bank and other financial institutions. Southern Ireland is again popular with many American companies.
Pavel Ryska analyst at J&T Bank
Luxembourg and Ireland as magnets for capital
In terms of GDP per capita, the richest European region has long been the Luxembourg capital, Luxembourg, which has 260 percent of the EU’s GDP risk. Right behind it is southern Ireland with 240 percent.
Their attractiveness for foreign entrepreneurs or multinational companies contributes to the statistical primacy of these two regions. The real product does not even have to be produced there, it is enough if it “flows” in the form of numbers in the financial departments of these companies.
“Luxembourg has long been one of the financial centers. There are a number of funds, a bank and other financial institutions, “comments analyst Ryska. “Southern Ireland is popular with many American companies because it’s tax-guaranteed.”
The billion-dollar business has dried up, the technological giant Kapsch is withdrawing from the Czech Republic
Kovanda would agree. “In the southern part of Ireland, Microsoft, Apple, Alphabet and Facebook have their European base. In addition, the region of southern Ireland is not densely populated, so the wealth made up of large American companies is budgeted among a relatively small number of people, “says Kovanda, adding that the wealth produced in Ireland does not warm up for too long. “Companies pay it elsewhere from Ireland in dividends or in various in-house transfers,” adds the economist.
|Region||GDP per capita (percentage of EU influence)|
|Eastern and Central Ireland||202%|
Regions cartoon statistics
Experts agree that similar statistics from Eurostat and other institutions need to be read in context. Ryska, for example, looks at the issue of the regions themselves, with which the EU statistical office works.
“These regions are defined by their size. In the Czech Republic, these regions do not copy our regions, nor do they copy local provinces in other countries either. When we look at France, for example, Paris is like a region connected to its surroundings. As a result, in some countries, cities and metropolises are classified as larger areas, which in turn reduces their average economic performance per capita. In contrast, Prague is narrowly defined in statistics only as the city itself, which helps it, “adds Ryska.