In this week’s business news: worker and management still far apart on wage rises at Škoda Auto; two Czech power companies but no ČEZ bid for German coal assets; electronic cash registers clear Senate; till ring slower in January; public deficit seen down to 60 billion in 2017.
Union leaders at the Czech Republic’s biggest car maker Škoda Auto say they are prepared to take unlimited strike action to push their wage claims for this year. The current collective agreement runs out at the end of March. Management is currently offering a wage hike of 3 percent with the unions demanding 8 percent. Škoda Auto, part of the Volkswagen group, this week announced record profits for 2015. Last year the two sides agreed on a pay rise of 3.5 percent.
Czech electricity producer ČEZ has said that it will not make a binding bid for the German coal mine and power plant assets of the Swedish-based power company Vattenfall. CEZ said that low wholesale electricity prices and uncertainty over whether brown coal power plants might have to be closed early deterred it from making a bid. The state controlled company added though that it was still prepared to talk about other options for the German assets. Separately, Czech Coal said it had made a bid for the assets. Later, Czech energy group EPH said it made a joint bid along with the PPF Investments company.
The Czech upper house, the Senate, has approved on of finance minister Andrej Babiš’ flagship measures aimed at combatting tax avoidance, so-called electronic cash registers. Attempts to amend the proposal or stall debate from members of right-wing parties failed. The controversial move now just needs to be approved by head of state, Miloš Zeman. The minister reckons the measure will curb tax avoidance to the tune of 18 billion crowns a year. Opponents say it adds another burden to small business and will not deliver on the promise of extra tax revenues.
Czech retail sales in January, not counting the automotive sector, fell by 4.6 percent year-on-year compared to a 6.7 percent rise in December 2015. The figures were released by the Czech Statistics Office on Monday. Czech consumers spent significantly more online, an increase of 15.4 percent year-on-year, while retail sales of food and fuel also increased. By contrast, consumers spent less on pharmaceutical items and medical goods. Prices decreased year-on-year in the categories of fuel, food and computers. Higher prices were registered in the categories of culture, sports and recreation, clothing and footwear and pharmaceutical and medical goods.
The public finance deficit in 2017 should be 60 billion crowns, Finance Minister Andrej Babiš said in a debate on commercial TV Prima. The minister indicated that meeting that target would not be easy, saying he expected to come under considerable pressure from individual cabinet members. Babis said he was counting on an increase in pensions, more funds for sports and emphasized the need for investment projects which he said would be given priority. The 2015 deficit in public finances was 62.8 billion, which is 37.2 billion less than originally projected.