Spending abroad

Lot of Slovaks visited not only before Easter shopping centers and groceries in Hungary, Czech Republic and Poland due to depreciation of their local currencies against Euro. It gained 10-30% against national currencies in last couple of weeks. Our banks reported up to 10x increase in payments with cards in these countries.

Reactions:

• Citizens usually tend to say: local stores should decrease their price and find savings in order to keep up with their counterparts in abroad.
• Local authorities say: we have 19% flat VAT compared to 7 or 10% VAT on groceries in Poland or Czech so there is the reason of higher price level in Slovakia.

Whether is the truth on one, or other side or somewhere in the middle one thing is indisputable: price of cars or real estate today compared to last year´s are much lower. This answers their earnings of 3,4 billions Euro for Volkswagen in H1 2008 or 183 mil. Euro for Immoeast (biggest CEE developer) in Q1 2008.