News in brief for July 27: Top headlines in Czechia for Thursday

A survey co-conducted by PAQ Research released today shows that about four-fifth of Ukrainian parents who migrated to Czechia since February 2022 have successfully secured Czech schools for their children aged three to 17 years for the upcoming school year. 

However, 11 percent are uncertain if their children will attend school in September, 6 percent have not enrolled their kids, and 3 percent of Ukrainian children have not been accepted. Overall, school attendance among the Ukrainian youth in the country has slightly increased since March, with 69 percent attending kindergartens, 94 percent registered in primary schools, and 53 percent studying at secondary schools in June.

The Senate has this afternoon approved an amendment to increase the consumption tax on diesel in Czechia, reverting to the previous level before June. President Petr Pavel is ready to sign the amendment, which would make it effective from August. If the law is changed, 1 liter of diesel will increase by up to CZK 1.8.

The government's decision to raise the tax rate comes in response to lower diesel prices and aims to boost budget revenues. The tax change is expected to generate an additional CZK 800 million per month, with CZK 727 million going to the state budget and CZK 73 million to the State Transport Infrastructure Fund. The original plan was to maintain the reduced rate until the year's end.

According to Czech National Bank (CNB) Governor Aleš Michl, inflation is still at too high a level to justify the central bank lowering interest rates. Despite domestic price growth slowing to below 10 percent, Michl says that Czechia still needs a hawkish policy to ensure inflation does to spike.

In June, year-on-year inflation hit 9.7 percent. The CNB aims to reach 2 percent annual inflation by the middle of 2024. The central bank’s basic interest rate has stood at 7 percent since June 2022. Higher interest rates make borrowing more expensive, putting downward pressure on prices and helping contain inflation.

According to an announcement by the Odra River Basin spokeswoman Šárka Vlčková this morning, around 2 percent, or one ton of the fish population on the Odra River by the Czech-Polish border have been found dead in recent days. 

The incident is likely due to adverse weather conditions, including low water levels and long-term warm temperatures, followed by heavy rain that brought sewage and reduced oxygen levels in the water. According to Vlckova, the dead fish included all species, but predatory fish more sensitive to the lack of oxygen were more likely to die.

In the first half of the year, Škoda Auto, a subsidiary of Volkswagen, saw a significant increase in operating profit by over one-third year on year, to EUR 911 million, driven by strong sales volume and higher prices.

However, exchange rates, production costs, and the Volkswagen Group's exit from Russia put a strain on profits. Despite these challenges, the company managed to boost sales to EUR 13.75 billion and delivered 432,173 cars to customers, a nearly 20-percent increase compared to the previous year. Škoda Auto operates multiple production facilities, including plants in the Czech Republic, China, and India.

Potato fields in Czechia are suffering from drought, leading to lower yields in the lowland regions of Central Bohemia and higher potato prices, according to the Czech Potato Association. Due to low supply, the potatoes are therefore becoming more expensive: farmers are receiving CZK 12 to CZK 14 per kilogram, about 50 percent more than last year.

Importing potatoes is not cost-effective, as prices in other countries are also elevated. The dry conditions have affected most areas, and rain in the coming weeks might offer some relief for later harvested potatoes in the highlands.

The Czech government has adopted a neutral stance on the Christian Democrats' proposal for same-sex partnerships, signaling a shift towards addressing rights settlement. Minister for Legislation Michal Šalomoun stated that the government views the proposed change as not fully sufficient. The cabinet previously expressed similar positions on other discussions, including legalizing homosexual marriage and constitutional protection of marriage as a union between a man and a woman.

The Christian Democrats' amendment aims to grant same-sex partners property and social rights akin to married couples, but it has drawn criticism for overlooking parental rights. The draft will undergo government discussion before proceeding to parliament.

The Czech government has approved a proposal by Defense Minister Jana Černochová to allow allies' flights over Czech territory annually starting next year. The decision aims to facilitate the approval of requests from allies for transits and overflights. The approved proposal covers the armed forces of states involved in multilateral technical arrangements within the European Defence Agency, NATO members, participants in the Partnership for Peace program, and countries with partnership relations with the Czech Republic.

Such overflights are conducted for training and military operations, and the Czech Republic seeks to fulfill its NATO obligations by facilitating these requirements. Approval by the Foreign Ministry is required for any overflights by foreign armed forces. The government and parliament will receive retrospective information on specific overflights and passages biannually.

The Czech government has made it clear that athletes from Russia and Belarus are not allowed to represent their countries in the Czech Republic. Foreign Minister Jan Lipavský stated this in connection with the upcoming women's tennis tournament in Prague. The government previously banned Russian athletes and teams from competitions on Czech territory in response to the invasion of Ukraine.

The event in question, the WTA tournament, will take place at Prague's Sparta in Stromovka from July 31 to Aug. 6. Despite concerns raised by former national hockey goalkeeper Dominik Hašek on Twitter, the tournament director assured that they will fully comply with the government's decision during the event.

Pojišťovna Kooperativa and Affordable Housing Česká spořitelna will jointly acquire 300 rental apartments in Prague 11 as part of the Opatov project by the Sekyra Group. The cost of the project was CZK 1.5 billion crowns, and each company will hold a 50 percent stake. The apartments will be utilized for affordable rental housing for socially beneficial professions such as healthcare workers and teachers.

The project is expected to be approved by the end of next year, and tenants can move in by the first quarter of 2025. The partnership aims to provide long-term accessible housing, and the rent prices are yet to be determined.

Prague City Hall mulls canceling a concert by Russian opera singer Anna Netrebko scheduled for October 16 in Smetana Hall. The organizers will seek financial compensation if it's canceled. Netrebko, on Ukraine's sanctions list due to Russia's invasion, has been criticized for supporting pro-Russian separatists in the past and is seen as close to Russian President Vladimir Putin.

Prague's Deputy Mayor for Culture, Jiří Pospíšil, stated that the ruling coalition agreed to cancel the concert. The producer expressed confusion over the cancellation efforts, claiming Netrebko condemned the war. The singer faced a boycott in the West after the 2022 Russian invasion of Ukraine.