Living standard in the Czech Republic will soon be higher than those in Spain and Italy
The incredible increase in per capita GDP in the Czech Republic, adjusted for purchasing power parity, is expected to surpass that of Mediterranean countries in terms of quality of life by 2030. A report by financial firm Bloomberg has found that parts of Central and Eastern Europe (CEE), including the Czech Republic, will surpass living standards of Mediterranean countries in the coming years. Using per capita GDP at purchasing power parity (PPP), Bloomberg has calculated that the Czech Republic is close to reaching countries like Italy and Spain, whose per capita GDP at PPP is respectively $56,905 (1.3 million Czech crowns) and $52,012 (just under 1.2 Czech crowns). The current rate in the Czech Republic is $50,475. Particularly, the Czech Republic is already more developed than some European countries in terms of per capita GDP, such as Portugal and Greece, both Southern European nations registering rates of about $47,000 and $41,000 respectively. The study predicts that the Czech Republic, akin to Poland, Slovenia, and Lithuania, will have higher living standards and be richer than Spain by the end of the decade, and close to Italy’s level between 2029 and 2029. Germany, with a per capita GDP of $67,000, remains out of reach.
According to Bloomberg, this exponential growth is attributed to these countries’ entry into the EU’s common market and foreign investments that have helped CEE countries reach Western European levels in recent decades. The financial site also emphasizes that the enrichment of CEE countries simultaneously brings more movement and fluidity (and perhaps more uncertainty) to the labor market, as workers are often seeking better-paying jobs. Bloomberg also notes that the recent shaky economies of Italy and Spain have helped the Czech Republic and other CEE countries regain ground compared to Southern European states.
A separate study by Eurostat also highlights the positive growth of the Czech economy. In particular, Prague is the fourth wealthiest city in the EU, based on per capita GDP levels at PPP. In 2019, Eurostat data placed Prague in third position. Compared to Warsaw and Paris, the Czech capital shows significantly stronger economic performance, boasting a per capita GDP of 25% higher. Additionally, Berlin’s per capita GDP is only 60% of Prague’s one.
However, it should be clarified that, as noted by Petr Dufek, Chief Economist of Creditas Bank, per capita GDP does not fully indicate the quality of life of a particular city, as other factors such as increased standard of living and business profitability can influence a nation’s overall economic growth. Nevertheless, the prospect of the Czech Republic’s continuous economic growth is a positive signal for the country and its position in the European economic arena. Therefore, the Czech Republic is projecting significant economic growth that could soon establish it as one of the nations with one of the highest qualities of life in Europe. As seen above, per capita GDP at PPP is steadily increasing, nearly reaching Mediterranean countries like Italy and Spain by 2030.
Sources: https://www.expats.cz/
