In search of German prices
2007-12-11
If Czechs have to pay German prices for electricity, why
shouldn't they also get to pay German prices for groceries,
electronics and clothing? It used to be that Germans would visit
the CR to do their shopping, but now it's the other way around.
The CR has become an expensive country, and this is a
monumental shift. Only part of the reason the grass is now
greener on the other side is due to the sharp rise in the crown
vs. the euro. Other reasons are low competition in the CR (in
some areas) and high bureaucratic barriers. These aren't going
to improve overnight. In the meantime, there's a big arbitrage
opportunity that's only partially being used. Not everyone can
jaunt across the border to do the weekly shopping. As prices
rise even further next year, Czechs will be more receptive than
ever to entrepreneurial ventures that are able to reduce the price
disparity with neighboring countries.
[Czech Republic Poland Austria Germany currency rates ČEZ]
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