Eastern Europeans face difficult fiscal choices

Significance The other Visegrad Four (V4) countries appear more reluctant to cut their budget deficits, despite increased scrutiny from the European Commission. Impacts Czechia may offer a more stable business environment, potentially becoming an entry point for companies looking to gain a regional foothold. Czechia's currency could appreciate relative to currencies in neighbouring V4 countries. The risk of capital flight from Hungary and Slovakia will rise as concerns mount about their political and economic stability.