In today’s business news: The head of the Erste Group predicts an economic revival in the Czech Republic for the second half of 2012, foreign direct investment into the country has reached 2.5 trillion Czech crowns since 1993, carrier Czech Connect Airlines has filed for bankruptcy, a SANEP poll finds that the majority of Czechs think the country’s billionaires are corrupt, and food inspectors have confiscated 2.5 tons of spring rolls containing mice droppings.
According to Andreas Treichl, head of the Erste Group, of which Česká spořitelna is a subsidiary, the Czech economy will be seeing a revival in the second half of 2012. Mr. Treichl told press on Wednesday that the Czech Republic’s low debt made the country an attractive choice for investors and that the chances for economic development at a time of a possible European financial crisis were better in the Central and Eastern European regions than in Western Europe. The fact that the US-based rating agency Standard & Poor’s last Friday downgraded the credit rating of Austria, where Erste Group is headquartered, could also affect Erste’s credit rating, he said. However, the effect is likely to be minimal. The Erste Group is one of the largest financial services providers in Central and Eastern Europe and focuses on retail and banking for small to medium enterprises.
Nearly 2.5 trillion Czech crowns in foreign direct investment have flowed into the Czech Republic since 1993, according to figures released by the Czech Statistical Office on Thursday. Between 1995 and 2009, the share of foreign investors in the domestic economic output grew from 7.3 to 42.5 percent. Foreign direct investment was highest in 2000, when the sale of state-owned bank and company shares in the Czech Republic reached its peak. Foreign capital is most strongly represented in the financial sector and the car and oil-refinery industries. The Netherlands leads the list of foreign investors, with Dutch investments into the Czech Republic amounting to 684 billion crowns. German investments reached 317 billion crowns, while Austrian investments came in third place, with 279 billion crowns.
The Ostrava-based carrier Czech Connect Airlines has filed for bankruptcy and will stop operating flights effective Saturday. According to a report in the daily Mladá fronta dnes, the carrier’s main investor dropped out of the company. The airline’s owners and management will be discussing measures to save Czech Connect Airlines and minimize the bankruptcy’s effect on its customers, employees and business partners. The company will also have to assist a group of Russian tourists, who had travelled to the Czech Republic with the airline a few days ago, in finding alternative transportation home. Czech Connect Airlines focuses mostly on scheduled flights to Russia and charter flights for travel agencies to various popular summer destinations. Last year, some 108,000 travelers had flown with Czech Connect Airlines, which had a fleet of only 2 planes.
According to a poll by the SANEP agency, commissioned by the Czech tabloid Blesk, 60 percent of Czechs associate the term billionaire with money tunneling, corruption and theft. Only six percent responded that a billionaire is a “successful businessman”. Similarly, 35 percent answered the question whether there are honest businessmen among the country’s billionaires with “no”, while 35 percent replied “probably not”. The poll also suggests that 35 percent of respondents believe former communist party officials had an advantage during the privatization process in the 1990s.
The Czech Agriculture and Food Inspection Authority have confiscated almost 2.5 tons of meat-filled spring rolls in an illegal production facility in Prague. Hygienic conditions in the facility were inadequate, the inspectors said. Meat and rice for the production of the spring rolls were wrapped in bamboo leaves. According to police, who discovered the facility, the ingredients for the spring rolls, which were sold to the nearby Asian marketplace Sapa, contained mice droppings. In connection with the case, police have arrested four Vietnamese citizens, who are living in the Czech Republic illegally and were working in the facility.