Wednesday May 25, 2022

Exports call for protection against slc crowns, damage them

This year, the Czech koruna is the fastest of all Central and Eastern Europe. However, this will noticeably affect domestic exporters who are pushing for anti-crisis revival in the country. And a strong disagreement with the governor of the Czech National Bank Miroslav Singr, that the exchange rate is not dramatic and that Czech companies are able to cope with it.

The koruna has strengthened the euro by about seven percent since the beginning of the year, and at the arrest of June it even touched the twenty-fifth maximum, ie its pre-crisis value. This is at a time when the biggest pressure is to devalue their currencies in order to make their companies more competitive, and the whole situation is threatening to grow into an open currency wolf.

MF DNES therefore addressed both exporters and small exporters with a survey on how the impact on their business exchange rate. The koruna is stronger, so domestic goods are beyond the borders of dra and the competitiveness of domestic companies is declining.

How do the most significant exports cope with the crown? Are you going to hire a new employee? tte on Monday MF TODAY.

Half of the companies contacted disagree with the resignation of Governor Singra. “A strong koruna is still a problem for Czech companies. Mainly because its value is not very small and the speculation on the capital markets is increasing, ”says Radek picar from the Mladá Boleslav code Auto.

For exports, the sun’s crown is still dark, also because other production costs will increase. The main increase in energy prices in the first year is mentioned, but economists can see the rising labor costs.

“So far, we are not able to keep up with the competition and get back to where we were before the recession,” said economist Raiffeisenbank Ale Michl. According to him, the Czech Republic’s decline in world exports is still behind, and both the sun’s crown and the growth of labor costs are behind it. “It’s a deadly combination for exports,” Michl explains, referring to the so-called relatively effective exchange rate, except for a change in the koruna’s exchange rate, which captures changes in labor costs.

“The relatively effective exchange rate has risen by 61 percent over the last eleven years, and our exporters, for example, have extremely harsh conditions compared to Poland,” the economist added, adding that the country would lose a weak koruna. In contrast to Poland and Hungary, this year the price of labor began to rise again.

The usual recipe for a strong currency, which disadvantages companies abroad, is the growth of their productivity.

“Not only for exports, it is essential to drink the euro as much as possible. In this way, we will avoid serious weights about the sustainability and unsustainability of the course, ”says Brisk, the manufacturer of spark plugs, Mojmr apka.

This opened up the darkness of the euro, which subsided in times of crisis, and the central bank, on the other hand, praised the Czech crown as a tool, only to allow its weakened companies to breathe. At the height of the financial crisis at the end of 2009, the koruna weakened to 29 crowns per euro. This is a good thing, he, for example, Slovakia, is then freshly paid in euros, drank. In times of post-crisis, the situation is again in favor of the euro. Apart from the strong exchange rate of the koruna, exports stand mainly on the unpredictable fluctuations of the Czech currency, which would fall off with the euro.

“Until you adopt the euro, there will be either exports to the koruna service or unions for its weakness,” said the former governor of the Slovak central bank Marin Jusko for MF DNES. He also warned against the complete sending of the koruna exchange rate in the period before the adoption of the common currency, which broke the neck in weak companies in Slovakia.

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