Overview of Czech news: Thursday, April 7, 2022

The ANO shadow government is asking the ruling coalition for a one-time bonus of CZK 6,000 for the elderly, higher parental allowances, a zero VAT rate for basic foodstuffs, as well as capped food prices. The measures are presented as a response to inflation, which is expected to rise further due to the war in Ukraine. The ruling coalition is skeptical of the consumer price cap, as it believes it only piles up problems for the future.

A Czech who fought for pro-Russian separatists against the Ukrainian army in 2016 has been sentenced to 20 years in prison. Alojz Polák is prosecuted as a fugitive; according to the prosecution, he killed four Ukrainian soldiers while fighting with separatists between 2016 and 2020. The indictment claims he was a sniper for the separatists, although the verdict of today ruled that it could not be proven that he killed anyone. The verdict is not yet final; an appeal will be lodged with the High Court in Prague.

The Czech Republic can leave the post-Soviet international banks, namely the International Investment Bank (MIB) and the International Bank for Economic Cooperation (MBHS). The Czech Senate today almost unanimously approved the withdrawal of these financial institutions. This decision is also supported by the lower house of the Czech parliament and Czech President Miloš Zeman. So far, two-thirds of MBHS member countries have withdrawn due to the war in Ukraine.

The Prague Castle authorities are suspected of having prematurely destroyed classified documents on the activities of the Russian armed forces on the Ukrainian border and NATO information on the security situation in Iraq. The rules stated that the documents should have been destroyed in 2023 at the earliest. The Office of the President of the Republic did not provide any explanation for the apparent discrepancy.

The Czech Senate, the upper house of parliament, has approved a bill establishing two new “significant days” in the Czech calendar. These are the day of national resistance on May 27 and the day of the departure of the occupation troops on June 25. The first date commemorates the assassination of Reich Protector Reinhard Heydrich in Prague by Czechoslovak paratroopers in 1942. The second is the anniversary of the signing of the protocol on the departure of the last Soviet troops from Czechoslovakia in 1991.

President Miloš Zeman will now sign the bill. According to the author of the bill, Christian Democrat Senator Lumír Kantor, the desire to make these two dates “significant days” has increased following the invasion of Ukraine by Russia.

The Czech government has approved accelerated military procurement programs for the period 2022 to 2024, worth a total of 48 billion Czech crowns. Yesterday Prime Minister Petr Fiala and Defense Minister Jana Černochová informed journalists about the military program.

The government has also approved a plan for legislative changes to improve and strengthen the Czech Armed Forces’ ability to react to crises. A better system of long-term defense financing is also planned, with the objective of reaching 2% of GDP devoted to defence, as required by NATO. The sudden emphasis on defense procedures is the result of Russia’s invasion of Ukraine and heightened security concerns throughout Central and Eastern Europe.

Czech President Miloš Zeman has doubled his pardon for Miloš Balák, the head of Lány’s forest administration. Balák was found guilty of influencing a public tender for the management of forests around the presidential residence in Lány.

In an interview with Mladá fronta DNES, Zeman said that Balák did not enrich himself from the affair and that no “national economic damage” occurred. Zeman also claimed that the nature of Balák’s corrupt act, which was to show a business around the forest, was not the reason for his conviction, but the place where he worked. Zeman described Balák as “an innocent man whose work I am very pleased with”.

New data from the Czech Statistical Office shows a drop in Czech industrial production in February. Production fell 0.3% year-on-year, which was a significant surprise after growing 1.2% in January. Economists had predicted a 1.5% increase. Still, the news wasn’t all bad: manufacturing output rose 0.4% and mining output 7.1%.

Separate figures showed that the Czech Republic’s trade balance turned into a deficit, with imports rising more than exports. A deficit of CZK 4.4 billion was recorded for February, compared to a surplus of CZK 21.3 billion in February 2021.

Fuel prices in the Czech Republic fell by tens of cents last week. Petrol is now sold at an average of CZK 43.88 per litre, down CZK 0.46 week-on-week, while diesel is sold at CZK 46.62 per litre, down CZK 0.33. Despite the fall in prices, fuels remain significantly more expensive than a year ago.

A year ago, petrol was up to CZK 12.58 cheaper, while diesel was CZK 17.06 cheaper. Both fuels reached record prices in early March due to uncertainty caused by Russia’s invasion of Ukraine and the weakening Czech koruna. The recent stabilization has led to lower prices.