Czech Republic’s Wealth Increase by 40% Since Joining the European Union

Published: 24.04.2024 Related countries:  China China

Since joining the European Union in May 2004, the standard of living for the average Czech citizen has significantly increased, surpassing several Southern European countries. Despite this, the Czech Republic still lags behind Western countries in terms of wage levels. The majority of domestic regions have benefited from joining the EU. However, this is not the case for all areas – some are moving away from the average standard of living in the European Union.

This is according to an economic analysis by Česká spořitelna (Czech Savings Bank), which states that the Czech Republic’s real Gross Domestic Product (GDP) per capita has increased by more than 40 percent, from 480,000 CZK in 2004 to 675,000 CZK last year. The average household consumption also rose by more than a fifth to 302,000 CZK.

The economic situation would be worse if the Czech Republic weren’t part of the EU. The bank said the GDP per capita for last year would be a fifth lower, around 130,000 CZK less, and household consumption would have reduced by a third or 100,000 CZK. Overall, Czech living standards have moved closer to that of Western Europe in the past two decades. While at the accession to the EU, Czechia had a GDP per capita at 80% of the European average by 2023, the per capita GDP in purchasing power parity reached 91%.

The Czech Republic has surpassed countries like Greece, Portugal, and Spain in terms of the standard of living and is getting closer to Italy. However, Czechia has missed out in many ways. Some countries that joined the Union at the same time grew faster. Poland, for instance, went from a living standard of 50 percent of the European average to 80 percent. Lithuania, on the other hand, grew from 43 to 90 percent of the EU average. Unfortunately, life in the Czech Republic is not the same everywhere.

In conclusion, the Czech Republic generally approaches the EU’s average standard of living, but some regions are moving away. Specifically, in the Karlovy Vary and Ústí nad Labem regions, the standard of living has grown slower than in the remaining areas and compared to the EU average, according to the leading economist of the Czech Savings Bank, David Navrátil. The most significant increase in the standard of living among Czech regions was in the South Moravian Region.

Created by the team of CzechTrade Shanghai
Source: Czech Daily