Six leading membership candidates called on the EU to announce a more precise time schedule of its enlargement by the end of this year. Czech Foreign Minister Jan Kavan, speaking on behalf of the Czech Republic, Poland, Hungary, Slovenia, Estonia and Cyprus, said that the six countries hoped to hear reassurance that the next members would be admitted in time for the 2004 election to the European Parliament. The six countries opened EU membership negotiations as early as in 1998. Six others began talks two years later. Kavan said the candidates wanted the EU to find a unified stance towards enlargement quickly, and also to differentiate between individual candidates on the labor issue to take into account "economic, social, historical and geopolitical facts". The six candidate countries once again emphasized in a joint statement their readiness to join EU from January 2003.
The non-launch of the nuclear power plant in Temelin would mean CZK 117.4 bn in direct costs plus further indirect damage, according to a study on "zero variant" released by the Czech Foreign Ministry. Indirect damage would consist of a loss from unrealized energy export (about CZK 5bn in five years), unrealized sale of rights to carbon dioxide production under the Kyoto protocol (about CZK 2bn annually) and a loss inflicted by higher imports of gas and oil. The loss for the CEZ, which is Temelin's investor, would be at least CZK 108.3bn and the company would submit the bill to the state because the state would close the plant. The value of CEZ in its planned privatization would considerably decrease. There would also be a marked negative impact of the decision on regional employment (about 5t people would be affected).
The owner of the steel group Z-group who owes some CZK 3.5bn to CSOB, proposed an immediate sale of CSOB's claims on his steelworks to a strategic partner. He said that the appraisal of the claims should be ready by the end of June. "We will not talk about how realistic the appraisal of the claims is but about the payment of the provided loans," CSOB spokesman Milan Tomanek announced. According to the owner, Mr. Zemek, there are investors interested in taking over the steelworks but willing to pay for the CSOB claims 25 % of their nominal value at maximum. CSOB filed a bankruptcy petition against Z-group's eight companies in October 2000. Zemek argues that the bank will not get more than CZK 330m from the completed bankruptcy procedure and the rest would have to be covered by the state.
The Czech GDP per capita could achieve 75 % of the EU average as soon as by 2006, predicted Minister Lachnit after his return from an EU conference on cohesion held in Brussels. The conditio sine qua non, though, should be EU-accession of the first six candidate countries in 2003. If the Czech accession takes more time or the number of invited countries rises, the 75 % target will have to be postponed in time. The 75 % share is important because it was defined to be the upper limit for drawing money from EU structural funds. At present, only region Prague in the Czech Republic reaches some 118 % of the average GDP per capita in the EU, while the other Czech regions produce about 59 %.
The Czech crown reached eight-week highs against the euro on Wednesday in thin trading and low volumes. Late on Wednesday the crown was very slightly up at 34.22/24 to the euro from the 34.24/27 late on Tuesday. CZK/USD dipped to 39.79/81 from 39.56/58 late Tuesday. Dealers said Reuters that the crown would probably remain in an uptrend and they did not expect April foreign trade figures, to published on Thursday, to have an impact. A Reuters poll showed the market expects a CZK 9.9bn trade deficit in April.
The state 6.95/16 bond down 15 basis points at 102.45/75, yielding 6.68/65 %. The state 6.75/05 lost three basis points to 103.77/07, yielding 5.59/50 %. Market activity was low, the same holds for traded volumes, prices went down on average. The Czech central bank announced on Wednesday it would auction a CZK 10bn tranche of a 13-week Finance Ministry bill on Thursday, with a limit yield set at 5.0 %. The yield in the previous auction of 13-week bills on April 12 was 4.96 %, equal to the limit yield.
| late May 23|| bond yield || late May 22|
| State 6.75/05||103.77/07||5.59/50||103.80/10|
| State 6.95/16||102.45/75||6.68/65||102.60/90|