The hard reality of EU funds and Visegrad.
PM Andrej Babiš of the Czech Republic spoke at the V4 summit in Bratislava. Babis told Merkel something she and other West EU leaders needed to hear.
The V4 Report has touched on this issue in the past, but this article helps clarify the details that many conveniently toss aside.
While anti-V4 demagogues in the EU Parliament continue to employ misleading rhetoric to attack the Visegrad states regarding EU subsidies, one must look past the slogans of EP simpletons such as Guy Verhofstadt.
– When the Czech Prime Minister Babiš began to speak, Merkel stared at him in shock.
”We are sometimes criticized for not being in solidarity while actually receiving money,” Babis said slowly as he assessed the critical comments of the West EU towards Central Europe.
“So in all due respect, it would be important to realize that from the four countries that stand here today, each year, 50 billion euro of dividends are leaving. This is also a very significant number. This is the debate that we are also conducting, and it would be good to make it here,” the prime minister said.
This leads directly to the ideas of French economist Thomas Piketty, who claims that post-communist countries have clearly contributed to EU membership.
“In Paris, Berlin and Brussels, people do not understand the lack of gratitude for the huge sums of public money that they send out to the east. But in Prague and Warsaw, things are interpreted quite differently. People emphasize that the return on Western investment here was enormous and that the amounts withdrawn by Western investors outweigh the amounts that came from the European Union. In fact, when we look at numbers, the Czechs and Poles have the truth. After the collapse of communism, Western investors (mainly Germans) gradually became owners of a significant part of capital in post-communist Europe. When we take the total volume of fixed capital (including buildings), it is a quarter,” wrote Piketty in January this year.
Piketty cites the data of his co-worker, Filip Novokmeth. Comparing how much money from Central Europe in the years 2010 to 2016 went to dividends (a distributed profit) is compelling. How much, on the contrary, came from European subsidies?
The article cites the Czech Republic as one example. According to official statistics of Eurostat, from 2010 to 2016, dividends from the Czech Republic were “diverted” to 7.6% of GDP. In absolute terms, this means that the Czech Republic has spent at least 2,252 billion crowns, while in the form of European subsidies, they have received 1.9% of GDP or 563 billion crowns.
That is CZK 1,689 billion over seven years, or an annual minus of CZK 241 billion to the Czech Republic. “In terms of economic performance, it is minus 5.7 percent of GDP,” said analyst Lenka Zlámalová in March at Echo24.cz from the article, “Czech Republic becomes a European breeder”.
* In other words, Western European companies are profiting quite nicely from these investments in Visegrad.
The West EU bloc may want to think twice about linking EU funds to migrant quotas before they shoot their own eyes out.