Is the Czech Republic prosperous among Western countries?

Credit ratings are an important indicator for investors. Simply put, it indicates a country\’s ability to repay its debt. The higher a country\’s rating, the safer it is in the eyes of lenders. Moody\’s recently raised the Czech Republic\’s credit rating to A1 from Aa3. The Czech Republic\’s rating was improved because improved budget indicators and government reforms are supporting the country\’s economy. However, the Czech Republic has yet to reach the prestigious ratings of Germany and Switzerland.

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Low wages and rising prices

Other studies indicate that three decades of democracy have contributed significantly to prosperity. However, the Czech Republic lags behind Western European countries in terms of wages. Czech wages are 25% to 40% of those in neighboring Germany. Despite the positive words of Prime Minister Andrej Babiš, the Czech Republic still ranks among the poorest countries in Europe. This group includes most of Eastern Europe and Portugal.

This year\’s survey reveals that despite Central Europe\’s growing prosperity, only one-sixth of respondents say their current income is sufficient. Rising prices, mainly housing prices, are the main cause of dissatisfaction. People are concerned about the gradual automation of production and administrative activities and the resulting job losses and redundancies.

The poverty rate is a positive indicator. The Czech Republic has the second lowest poverty rate in Europe (3.8%) and is one of the countries with a relatively equal distribution of wealth. This means that the majority of the population benefits from the country\’s prosperity.

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Future Prospects

Studies show that Central and Eastern European countries are slowly but surely catching up with the West, both politically and economically. These countries, including the Czech Republic, will continue to face the threat of growing poverty and income inequality. The structure of health care and education will also need to be addressed in more detail.

It is already certain that major and often radical changes are inevitable in Central Europe. However, having taken the long road to prosperity over the last 30 years, it is possible to estimate future success, if not slow down.