Politics & Economics

Czech PM Andrej Babiš Could Become President Even if He Goes to Prison

Former Prime Minister Andrej Babiš and his former adviser Jana Nagyová are facing potential prison terms in the Čapí hnízdo (Stork Nest) case, which is being pursued by Prague prosecutor Jaroslav Šaroch. However, even if he is convicted, he may have constitutional grounds for becoming president, a position he is likely to seek in the upcoming election. According to the indictment, Babiš illegally drew a subsidy worth 50 million crowns and used it to build the Stork Nest. In an interview with the SeznamZprávy news outlet, constitutional lawyer Jan Kysela stated that Babiš could become Czech president even if he was convicted. As stated by lidovky.cz news outlet, Babiš is accused of subsidy fraud and damage to the financial interests of the EU, while the actions of Nagyová are qualified as helping Babiš in this criminal activity. Babiš and Nagyová have been rejecting such accusations for a long time. Babiš meets the basic requirements to run for president Constitutional lawyer Jan Kysela commented on what the lawsuit means in terms of Babiš’s presidential candidacy. Babiš is one of the favorites in the upcoming elections, which will take place at the beginning of 2023. According to Kysela, it is presumed that a person facing criminal charges would not...

by Prague Morning Mar 24, 2022

Czech PM Says Putin Will Create New Soviet Union if We Don’t Stop Him Now

Petr Fiala told The Daily Beast that Western allies need to rush more anti-aircraft and anti-tank missiles to Ukraine to halt the Russian advance. Petr Fiala has powerful early memories of tanks. In August of 1968, the Soviet Army invaded Czechoslovakia and crushed an uprising against the Soviet Union’s dictatorial rule. More than 100 people died in the street while resisting the soldiers. Back then, Fiala was just 4 years old, but he can still recall his parents’ shock and distress, which lingered long after the Soviet soldiers had withdrawn to their nearby barracks. Now, Fiala is 57 and prime minister of the Czech Republic, which split peacefully from Slovakia in 1993. The Soviet invasion that went down in history as the “Prague Spring” has left Fiala extremely vigilant when it comes to Russia. This is why Fiala did not hesitate when the idea of going to war-torn Kyiv to meet Ukrainian President Volodymyr Zelensky came up at the European Union summit in Versailles. “I saw the Soviet tanks in the streets of Prague and I know very well what it did to my country for the next 20 years. I don’t want to see Russian tanks here or anywhere else in Europe again,”...

by Prague Morning Mar 24, 2022

Madeleine Albright, First Female US Secretary of State, Dies

Former US Secretary of State Madeleine Albright, who was a native Czech, has died of cancer at the age of 84. Albright was a central figure in President Bill Clinton’s administration, first serving as US ambassador to the United Nations before becoming the nation’s top diplomat in his second term. She championed the expansion of NATO, pushed for the alliance to intervene in the Balkans to stop genocide and ethnic cleansing, sought to reduce the spread of nuclear weapons, and championed human rights and democracy across the globe. She was a face of US foreign policy in the decade between the end of the Cold War and the war on terror triggered by the September 11, 2001, attacks, an era heralded by President George H.W. Bush as a “new world order.” The US, particularly in Iraq and the Balkans, built international coalitions and occasionally intervened militarily to roll back autocratic regimes, and Albright — a self-identified “pragmatic idealist” who coined the term “assertive multilateralism” to describe the Clinton administration’s foreign policy — drew from her experience growing up in a family that fled the Nazis and communists in mid-20th century Europe to shape her worldview. She saw the US as the “indispensable nation” when it...

by Prague Morning Mar 23, 2022

An Influx of Ukrainians Refugees Could Halt Wage Growth

An influx of Ukrainian refugees into the Czech labor market will aid the country’s economy, but it could also compress wages, Štěpán Křeček, the adviser to Prime Minister Petr Fiala has told Czech news outlet Echo24. For several years, employment offices have been offering more places than registered jobseekers across Czechia. There are current 360,000 job vacancies with just 260,000 applicants. Sectors such as gastronomy, healthcare, industry, logistics, and IT have been most affected, however, the current conflict in Ukraine has the opportunity to rectify this with many skilled workers returning home. So far, an estimated 270,000 people have come to Czech Republic, with more refugees expected to arrive in the longer term. “Thanks to the arrival of the Ukrainians, positions can be filled in which the Czechs no longer want to work. If we manage the integration of the Ukrainians, it will ultimately help our economy,” Štěpán Křeček told the news outlet. According to Křeček, employers welcome the arrival of a new workforce, however, current employees will face tougher competition and may perceive the opposite. Businesses are currently needing to satisfy the requirements of prospective employees, however, a redress of the balance of power could see working conditions and wage...

by Prague Morning Mar 23, 2022

Czech Union of Bakers Warned About Sharp Rise in the Price of Bread

The Association of Bakers and Pastry Chefs called on the authorities to limit wheat exports, as the price of the grain has almost doubled year on year due to the fighting in Ukraine. If no measures are taken, the country may face a deficit of this key product, which will lead to a sharp increase in the price of bread, up to 60 crowns per kilogram. Many countries in Asia and Africa depend on imports of cereals from Russia and Ukraine, but now due to the war, they have to buy raw materials in other countries, including the Czech Republic. According to Bohumil Hlavatý, executive director of the Association of Bakers and Pastry Chefs, “the Czech Republic is completely self-sufficient in the production of wheat, which is an essential raw material for Czech pastries, and exports a significant part of its production. Unfortunately, the current situation affected by the war in Ukraine has increased the price of wheat year-on-year by 100 percent.” As a result of the increase in the prices of raw materials, fuel and energy, Mr Hlavatý says bakeries saw their costs rise by more than 30 percent in January compared to the same month last year. The...

by Prague Morning Mar 23, 2022

Czech Finance Minister: Total Ban on Trade With Russia Not Realistic

A total ban on trade with Russia proposed by Polish Prime Minister Mateusz Morawiecki is not realistic as the EU’s four sanction packages are working well, said Czech finance minister Zbyněk Stanjura. “From what I have heard from fellow finance ministers from other countries, I do not think this proposal will get support,” Stanjura said. While the Czech government claims that it promotes the strictest sanctions against Russia, a complete ban on trade would mean the end of gas and oil imports from Russia – a move unacceptable for several EU countries, including Germany and Austria. Further measures against Russia will be discussed at the European Council summit on 24 and 25 March. In its latest package, the EU widened sanctions to more Russian and Belarusian oligarchs and banned exports of luxury goods, iron, and steel, as well as investments in the Russian energy sector. EU sanctions are landing a devastating blow to the Russian economy, said Czech National Bank Governor Jiří Rusnok. European and US sanctions will set the Russian economy back twenty years, he added. Stanjura added that the fifth package of EU sanctions is being prepared. Czechia proposes to exclude all Russian banks from the SWIFT international...

by Prague Morning Mar 22, 2022

Former Czech Prime Minister Babiš Indicted in Fraud Case

Czech Former Czech Prime Minister Andrej Babiš will face trial after the prosecution indicted him in a fraud case involving European Union subsidies. The move announced on Monday by Prague’s public prosecution office came weeks after lawmakers in the lower house of the Czech Parliament agreed on March 3 to lift Babiš’ immunity from prosecution for his alleged involvement in the $2 million fraud. That decision allowed the prosecutors to complete their review of the case and go ahead with Babiš’ indictment. It was repeatedly recommended by police investigators. Babiš denies any wrongdoing and has repeatedly said the allegations against him were politically motivated. “I’ve never done anything illegal, in the past or in politics,” he said on Monday. “I’ll prove it at the court.” The prosecution said Prague’s Municipal Court will take over the case. A date for the trial has not been immediately set. The allegations involve a farm that received EU subsidies after its ownership was transferred from the Babiš-owned Agrofert conglomerate of around 250 companies to Babiš’ family members. Later, Agrofert again took ownership of the farm. The subsidies were meant for medium- and small-sized businesses and Agrofert wouldn’t have been eligible for them. Lawmakers twice...

by Prague Morning Mar 21, 2022

Czech, Polish, Slovenian Prime Ministers to Visit Kyiv on Tuesday

Prime ministers of the Czech Republic, Poland and Slovenia will travel to Kyiv on Tuesday to meet President Volodomyr Zelenskiy as representatives of European Union leaders, Czech Prime Minister Petr Fiala said on social networks. “The purpose of the visit is to confirm the unequivocal support of the entire European Union for the sovereignty and independence of Ukraine,” he said. “The aim of this visit is also to present a broad package of support for Ukraine and Ukrainians.” Polish Prime Minister Mateusz Morawiecki, Petr Fiala, and Slovenia’s Janez Jansa will also meet with Ukrainian Prime Minister Denis Shmyhal during the visit. The trip was organized “in agreement with” European Council chief Charles Michel and European Commission president Ursula von der Leyen, it added. The agenda of the talk is expected to revolve around Ukraine’s immediate needs. “The purpose of the visit is to confirm the unequivocal support of the entire European Union for the sovereignty and independence of Ukraine and to present a broad package of support for the Ukrainian state and society,” the statement said. Today, we are going together with PM of Poland Mateusz Morawiecki, deputy PM Jarosław Kaczyński and PM of Slovenia Janez Janša to Kiev...

by Prague Morning Mar 15, 2022

Czechs Buying Massive Amounts of Foreign Currencies, Mostly US Dollars and Euros

In recent days, Czechs have begun to look for foreign currencies to buy up as uncertainty in the global economy and inflation pressures grow. Most of the addressed money changers agreed that the demand for currency exchange had begun to rise in the last seven to ten days. According to them, Czechs are especially interested in exchanging korunas for U.S. dollars or euros, seen as relatively safe currencies. Demand has also grown for the British pound and Swiss francs. According to the exchange offices, the usual amount of money people want to exchange has also increased, with often tens of thousands of crowns being transferred per individual (about €400 to €3,500). Now, there are long lines at some currency exchange offices in Prague, and the majority of the customers consist of Czechs. According to the exchange offices, the interest from Ukrainians has also increased slightly, but not significantly. The situation is more difficult because some Prague exchange offices no longer buy the Ukrainian hryvnia. In other places, the purchase of the Ukrainian currency still works, but often at a significantly reduced exchange rate. All the contacted Czech exchange offices completely stopped the purchase of Russian rubles. The main reason is European...

by Prague Morning Mar 12, 2022

Why is the Czech Government Doing Nothing About Rising Gas Prices?

The eagerly awaited government meeting, which was to seek an answer to the sharp rise in prices of gasoline, diesel, and, secondarily, other energies, ultimately bore little fruit. For the time being, excise tax and VAT on fuel will not be remitted, nor will the government resort to capping prices at gas stations. Instead, the ministers announced two minor, albeit welcome, changes: they will abolish the obligation to mix bio-components into fuels and temporarily introduce a road tax on vehicles not exceeding 12 tonnes unladen weight, but it is desperately insufficient. According to available reports, there were two arguments as to why the government decided to only adopt these two measures. One of them says that if the government announced a price cap, it would encourage stocking up on fuel, lines at gas stations, and consumer panic. The second reason concerns excise duty and VAT on fuel. With more than 100 billion crowns a year, taxes on gas and diesel are among the main sources of the state budget’s income. By cutting the excise tax, the government would thus lose tens of billions of korunas at a time when it wants to reach a balanced budget as quickly as possible. The government...

by Karolina Kubičková Mar 12, 2022

Czech Inflation at Its Highest Level Since June 1998

Czech inflation accelerated to 11.1% year-on-year in February, its highest level since June 1998, up from 9.9% recorded in January, said the Czech Statistics Office in its monthly report. “Inflation thus accelerated further, significantly exceeding the upper boundary of the tolerance band around the CNB’s target. Consumer prices adjusted for the first-round effects of changes to indirect taxes rose by 10.7% y/y in February,” said Petr Kral, Executive Director, Monetary Department. The growth in consumer prices also exceeded analysts’ estimates, who expected growth to reach 10.3% to 10.6%. Some of them pointed out that the war in Ukraine, which had led to a sharp rise in the prices of a number of commodities, had not yet been included in February’s inflation. “The inflationary impact of the war and the related sanctions in the Czech Republic will be felt only in the following months. Inflation may rise up to 15%. However, it depends on the development of the war conflict and the severity of the sanctions and Russian response,” commented Lukas Kovanda, chief economist at Trinity Bank. “Consumer prices increased by more than 11% in comparison with last February. Y/y price growth has accelerated since last July, i.e. for eight consecutive months. The most...

by Prague Morning Mar 11, 2022

President Zeman Awarded the Highest State Award to Volodymyr Zelenskiy

Czech President Milos Zeman, on Monday evening, awarded the highest state honors to Ukraine’s President Volodymyr Zelenskiy for his bravery and courage in the face of Russia’s invasion. Zeman has supported closer ties with Russia since taking office in 2013 but called Russian President Vladimir Putin a “madman” at the outset of Russia’s invasion of Ukraine on Feb. 24. Russia has faced harsh Western sanctions in retaliation for its invasion, which Moscow has called a “special military operation” to disarm Ukraine. On Monday, at an overdue state awards ceremony – which had been interrupted in the past two years by the COVID pandemic – Zeman showed support for Ukraine and its people as “war raged”, calling the war one provoked by Russian aggression. He said one parliamentary deputy had proposed awarding Zelenskiy the highest Czech honours. “And I decided to comply with this proposal,” Zeman said. “This is because the Ukrainian president has shown courage and bravery, and although the United States offered him an evacuation, he stayed in the capital of his country, from where he is leading its defence.” CTK news agency cited Zeman’s spokesman as saying Zelenskiy could be given the honours at the end of October,...

by Prague Morning Mar 08, 2022

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