Czech Republic risks losing billions due to slow EU subsidy drawdown

The Czech Republic faces a critical situation regarding the drawing of European subsidies from various operational programs, particularly the Just Transition program, which aims to support regions traditionally reliant on coal mining. According to a report published by the Ministry for Regional Development, if the country does not expedite the utilization of these allocated funds within this year, it risks losing a significant portion, specifically one to four billion crowns. This potential loss emphasizes the urgency for prompt action in drawing these funds, vital for the nation's economic stability. In addition to the Just Transition program, the report pointed out that the Technology and Applications for Competitiveness program and the Fisheries program are also at risk of underutilization. These programs are essential for enhancing competitiveness, short-term efficiency, and supporting sustainable fishing practices in the Czech Republic. The report indicates the necessity for strategic planning to maximize the benefits of these financial resources and avoid substantial economic setbacks. To address these challenges, the national coordination authority, represented by Minister for Regional Development Petr Kulhánek, has proposed 21 measures aimed at simplifying the administrative processes surrounding subsidy allocation and utilization. These measures are designed to enhance the overall efficiency of drawing funds and ensure compliance with the EU's rules. Particularly, the so-called n+3 rule states that allocated project support for a given year must be fully utilized within the following three calendar years, putting pressure on the Czech Republic to act swiftly. The potential impact of these subsidies on various sectors, including regional development, transport modernization, and entrepreneurship support, underscores their importance for the Czech Republic’s future growth and competitiveness. The evaluation of measures and further risk analysis will occur in the autumn, ensuring that the implementations are on track. For the current programming period from 2021 to 2027, the European Union has allocated a total of 550.5 billion CZK for the Czech Republic, signifying the critical role these funds play in the nation's developmental agenda.