EU country briefing: Czech Republic

[Photo: Robert Steenland]

The following article is a part of a series of brief country profiles for the EU-28 ahead of the European elections in May.

The Czech Republic, shortened to Czechia since 2016, was the second most developed country (after Slovenia) of the eight Central and Eastern European states joining the EU in 2004. Support for EU membership was confirmed in a 2003 referendum, where 77.3% of voters supported this, with a turnout of 55.2%.

Today, many Czechs appear indifferent about their membership, as 42% consider it neither a good or a bad thing, whereas just 39% (the lowest in the EU) believe it is a good thing. Moreover, only 32% of Czechs trust the EU, the second lowest after Greece.

Unlike Slovakia (with which it used to form Czechoslovakia), Czechia didn’t adopt the euro and the current government does not plan to do so either. But the country has the obligation to adopt the EU currency under its accession treaty.

The government’s scepticism toward the currency is rooted in pragmatism – most Czechs (74%) oppose the replacement of the Czech Crown, hence support for the euro is politically risky. Fellow Visegrád Group members Poland and Hungary also oppose the single currency.

With a total population of 10.5 million, the Czech Republic represents 2.4% of the total EU without the UK. 21 Members of European Parliament (MEPs) will be re-elected this year.

EP elections have so far generated little enthusiasm, as just 18% of the population, the second lowest after Slovakia, turned out to vote in 2014. Nevertheless, a small majority of 57% Czechs does feel like they are citizens of the Union, against 47% that do not.

Economy:

Following two years of economic recession in 2012 and 2013, Czechia enjoyed robust growth from 2014 to 2018, averaging 3.5% (real GDP) annually, outperforming the EU average of 2.1%.

However, labour shortages in the country are expected to further constrain its economic growth, which is expected to slow down to 2.7% by 2020, as the country recorded the lowest unemployment rate in the EU (2.2%) in 2018, ‘outperforming’ its big neighbour Germany (3.4%).

As an export-focused economy reliant on global trade, the country could also face a potential growth setback if the external environment deteriorates further.

In economic size, Czechia’s total GDP was around €192 billion in 2017, corresponding to roughly 1.5% of the EU-27 (if the UK eventually leaves).

At individual level, this amounts to €17,200 in real GDP per capita in 2017, falls behind the EU28 average of 27,700. Nonetheless, in purchasing power standards (PPS), Czechia’s was 89% of the EU28 average in 2017.

Political context and direction

Following the end of communism in 1989, Czechoslovakia shortly existed as a federative Republic for four years, after which it split into the Czech and Slovak republics in 1993.

This event is also known as the Velvet Divorce (referencing the bloodless Velvet Revolution), and was a rather political decision, as only 27% of Czechs and 35% of Slovaks supported this.

The new Constitution established

Czechia as a bicameral parliamentary republic, consisting of the Chamber of Deputies with 200 members, and the Senate with 81 members, elected for four-year and six-year terms, respectively. The Chamber of Deputies holds greater power than the Senate, as it can exercise parliamentary scrutiny over the government.

While the prime minister (currently Andrej Babiš) carries the most political weight, it shares power with the president (Miloš Zeman), who has the right to veto the Parliament, nominate constitutional court judges and dissolve the Chamber of Deputies in special cases.

However, the president assumed a more influential de-facto role, in part due to the moral authority of Václav Havel, a leader of the Velvet Revolution and subsequent president of Czechoslovakia (1989-1992), who went on to become Czechia’s first president (1993-2003).

During his term, the calm Havel often found himself at odds with Vaclav Klaus who was prime minister until 1998. While the rivals used to be part of the same political alliance (Civic Forum), the latter founded the successful conservative Civic Democratic Party (ODS).

Klaus became the country’s president from 2003-2013 and often sought conflict with the ruling governments. He also became increasingly critical of the EU and attempted to block the ratification of the Lisbon treaty. After a no-confidence vote against Prime Minister Topolanek in 2009, the government collapsed halfway during the Czech presidency of the EU.

The most dominant political parties in the Czech Republic were ODS (ECR-affiliated) and the centre-left Czech Social Democratic Party (ČSSD), as they had shared the two top spots in the parliamentary elections until 2013.

After that, new political parties such as the centre-right TOP 09, the populist ANO (ALDE-affiliated) of businessman Babiš, or SPD gained in prominence. Another notable party is the communist KSČM, which has been excluded from governments, although it provides minority support to the ANO-led government of 2017.

Czech politics have also had a major figure in the brash Miloš Zeman, who led ČSSD since 1993 (before being briefly part of Civic Forum), and who governed as prime minister in 1998-2002. After a failed presidential bid in 2003, in part due to opposition from his own party, he distanced himself from the ČSSD.

However, in 2013’s first direct presidential elections, Zeman made a surprise comeback, supported by Klaus, rebranded as a left-wing populist with nationalist rhetoric.

His victory increasingly polarised the country, especially due to his having links with Kremlin and having classified the 2014 events in Ukraine as a ‘civil war’. The relationship between Zeman and Russia would prove problematic in the future, including an attempt by the parliament to curb presidential powers over sanctions on Russia.

In the same year, Czech politics faced another earthquake as the ODS coalition government collapsed over a spying and corruption scandal, which involved closes aides of Prime Minister Petr Nečas, including his chief of staff (who was also his mistress). The ODS collapsed electorally and ANO, with its anti-corruption agenda, climbed to second place.

Another corruption scandal hit ANO in 2017 but Zeman used his presidential prerogatives to support Babiš. In the end, following an agreement, Babiš did leave the government and had his parliamentary immunity stripped. However, the events played into the hands of ANO, which went on to win 2017’s elections.

Babiš  (often compared to Berlusconi and even to Trump) was aided by his grip on media, which he used against political competitors. This led to concerns over an illiberal turn for Czechia.

ANO also rebranded itself as Babiš used increasing anti-immigration and Eurosceptic rhetoric. He also criticised the German Chancellor for her alleged mismanagement of the migration crisis and rejected adopting the euro.

The 2017 election saw an unprecedented fragmentation of Czech politics, which strengthened or gave birth to new parties. Those included the Eurosceptic right-wing populist Freedom and Direct Democracy (SPD) and the pro-EU social-liberal Czech Pirate Party, which ended third and fourth, respectively. Nine groupings won parliament seats in total.

Many parties initially refused to form a coalition with ANO as long as Babiš was its leader, but after several negotiating rounds, the ČSSD entered a minority coalition with him. The Communists then agreed to support the government, which narrowly won the vote of confidence.

In 2018, Zeman won a second term despite continued controversy. He did so on an even more extreme and polarising platform, based on demonising his opponent who he suggested was open to welcoming migrants. Most of his support came again from the rural, more conservative and low-educated areas of Czechia.

On the whole, the last decade of Czech politics has led to a radical shift in Czech politics, as the once-dominant ODS and CSSD have lost their former glory and ANO dominates the political landscape, followed by a large group of second-tier parties whose support fluctuates heavily.

 Predictions

Given the low turnout of just 18% in 2014 EP elections, the lack of voters’ interest  could prove crucial for any political party. According to a poll by the EP, ANO will win the elections with 31% of the vote. This would result in 7-8 MEP seats for the Alliance of Liberals and Democrats for Europe (ALDE). [List of ANO candidates]

The parties fighting for second place are the Pirates party (17%) and ODS (14%), forecast to win 4 and 3 MEP mandates. For ODS, these would go to the Alliance of Conservatives and Reformists in Europe (ECR). It’s unclear which group the Pirates will join.

They are followed by a coalition of centre-right parties (10%): TOP 09 + STAND + SZ, which could win two MEP seats for the European People’s Party (EPP).

Other parties set to win an MEP seat include the communist KSČM (7%), social-democrat CSSD (7%). These would go to the European United Left–Nordic Green Left (NUE/NGL) and Progressive Alliance of Socialists and Democrats (S&D), respectively.

The right-wing populist SPD is still at 7% and could win one MEP seat for a Eurosceptic group, though it has struggled in the polls recently because of internal troubles.

The final party that stands a chance to win a MEP seat for the EPP is the Christian-democrat KDU–ČSL that polls 5%.

It is difficult to predict the actual outcome. Apart from the turnout factor, there is also a recent domestic poll that actually suggests ANO might lose its pole position to the Pirates. Given the recent political volatility in the country, anything seems possible.

Robert Steenland works as an evaluation and research consultant in EU policies, as well as an analyst in EU politics.  He holds a double degree master in European Governance.

Patrik Fritz works as an EU policy analyst in the European insurance sector, and holds a master degree in European Studies.

Pablo Ribera Payá is a PhD candidate in European Studies at Masaryk University and works in EU policy analysis and communication. He holds a double degree master in European Governance.

Jan Szyszko – EU policy researcher and analyst based in Warsaw, publishing with In.Europa and Polityka.pl among others. Previously with Polityka Insight, graduate of the College of Europe and Trinity College, Dublin.

[Edited by Georgi Gotev]

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