Illustrative image. | Photo: Pixabay/Bru-nO
There are big disagreements about this and it’s also not clear in my ODS. Do Euros need to be paid in the Czech Republic too? I think so. Citizens and entrepreneurs who offer work to other people will get it.
Our largest trading partners are the countries of the European Union, which account for about 80% of Czech exports and about two-thirds of imports. It is dominated by countries with a population of 340 million, which use the euro as their currency. These facts are already strong reasons for us to introduce the euro as a currency in the Czech Republic, because it will greatly facilitate trade with our main trading partners.
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What are the other benefits of the euro? Thus, due to its application, costs have been eliminated in the Eurozone which caused exchange rate fluctuations. Moreover, eurozone businesses and customers do not have to deal with fluctuations in currency markets, which is often a problem that makes production and services more expensive. It also leads to low investment and a volatile economic environment.
If the company is trading abroad, it should take into account the deviation of the exchange rate and take into account its effects. It stands to reason that the longer the planning time, the greater the problems with unexpected currency fluctuations. It is true that companies can face these risks through actions with banks, but these are additional costs for them that can be eliminated if the euro is introduced. Although the introduction of the euro will not completely eliminate the exchange rate risk against other currencies, trade with the eurozone is the most important for us.
The elimination of this problem in the European Union member states that joined the eurozone led to a significant decrease in interest rates and, accordingly, to cheaper loans to companies, which significantly contributes to improving the business environment.
The introduction of the euro is also important for foreign investors planning their activities in the Czech Republic. One currency will save them a lot of money, for example, double accounting will disappear. The absence of the euro in our country is the reason why they are preferred in the final decision to a member state of the eurozone, such as Slovakia.
Belonging to the eurozone has other advantages. This includes membership in the Single Euro Payments Area (SEPA). Its members are 36 European countries, of which 27 are members of the European Union. This association acts as a single payment point in euros under the simplified mediation of money transfer in European countries.
The writer is Regional Representative of Central Bohemia in the ODS.
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