Forecasting Dinner 2015

Conducted in: 2015

About the survey

The survey was conducted on the occasion of the 13th annual CFA Society Forecasting Dinner 2015, organized regularly by the CFA Society Czech Republic, associating certified financial experts. The theme of the annual meeting of leading domestic and foreign economists under the auspices of Miroslav Singer, Governor of the Czech National Bank, is the forecasting of the economic development of the country in the coming year as well as trends on the international markets. 

Donath Business & Media PR agency, in cooperation with the Herzmann consulting company, conducted the on-line survey for the CFA Society Czech Republic from January 7 to January 20, 2015. The purpose of the survey was to map the views of economic and financial experts on selected aspects of the Czech economy. The exchange rate of the Czech shot to CZK 28.40/EUR during the survey period.

An invitation to take part in the survey was extended to:
  • Members of the CFA Society Czech Republic, and candidates of the CFA Program;
  • Leading figures of the Czech business and financial sector (VIP);
  • Readers of The Fleet Sheet's Final Word electronic bulletin.

The questions focused on:

  • Policies of the government and the CNB;
  • Russian and Chinese investment in the country;
  • Economic development of the country.

A total of 1,699 respondents took part in the survey. The invitation was extended to 8,122 individuals, for a 20.9% response rate. 

Key findings

CNB’s policy of interventions has not helped to revive the economy  

The majority (53.2%) of those taking part in the survey believe that the bank’s action to weaken the crown has not helped to revive the Czech economy; more than a third (37.0%) are of the opposite opinion. However, the subgroup of respondents from the financial sector shows a different pattern: 54.9% believe the CNB’s intervention policy has helped to revive the Czech economy. The majority (55.3%) expect the CNB to use intervention to maintain the current exchange rate of the crown for the next 12-18 months. 

Appointment of the Bank’s board should not be solely the President’s prerogative

A clear majority of the respondents believe that the appointment of the members of the CNB board should not remain an exclusive prerogative of the President. This view is shared by almost two-thirds of the respondents, whilst less than one-third (32.2%) are of the opposite opinion. 

The government fails to control corruption and unemployment 

Three-fourths of the respondents (73.4%) believe the government fails to implement the promised anti-corruption measures; only one-fifth (19.3%) are of the opposite opinion. The findings correspond to last year’s expectations. The majority of the respondents (58.2%) believe the government’s policy does not help to reduce unemployment. Less than one-third (30.5%) are of the opposite opinion. Respondents from the private sector and managers are the most critical of the government. 

The new VAT structure is not suitable for the Czech economy

Late last year the government pushed through a new VAT arrangement, which took effect on January 1. More than two-thirds of the respondents do not consider the VAT structure of three rates, i.e. 21%, 15% and 10%, to be suitable for country. This critical view is shared by 67.8% of the respondents, whilst 27.8% are of the opposite opinion.

China is an opportunity, Russia more of a threat

Whilst twice as many view Chinese investment in Central Europe as an opportunity (65.6%) compared to those who see it as a threat (31.0%), in case of Russian investment a moderate majority sees it rather more as a threat (50.5%) than an opportunity (47.1%). The Czech government should encourage the investment, but only in selected industries and activities (51.9% in the case of Russian investment, 61.5% in case of Chinese investment). 38.8% oppose any kind of government incentives for Russian investment, and 24.9% in the case of Chinese investment. A large majority of the respondents (74.3%) expect the inflow of Chinese investment to Central Europe to grow in the years to come, while only a little more than a quarter (28.3%) expect growth in Russian investment. 

Human rights prevail over economic interests

Which is more important in relation to Russia and China: economic interests, or the principles of democracy and human rights? Nearly two-thirds of the respondents see democracy and human rights as the priority (61.5%); more than one-third prefer the economy (35.8%). Half of the respondents (50.9%) believe Czech politicians are able to provide efficient support to Czech firms active on the Russian and Chinese markets. 

Crisis in Russia will reduce the growth of Czech economy 

Nearly two-thirds of respondents (62.3%) expect the crisis in Russia to reduce the growth of Czech GDP; 47% of the respondents expect the reduction to be less than 1%, and only 15.3% expect the reduction to be more than 1%. 

Kontakt: Tomáš Jelínek

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