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Breakfast Brief – 17 February 2009

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Klaus scolds Time’s praise of Marx’s ideas

In an opinion piece today reacting to Peter Gumbel’s recent article Rethinking Marx that appeared in Time magazine, President Václav Klaus says he cannot believe that after the fall of communism anyone could publicly defend such a system. Klaus said post-communist EU states had seen the EU return to a number of economic and political policies that were common under communism. But he said Brussels dismisses the distrust of these members as due simply to their “hypersensitivity, misunderstanding” and “underestimating the ‘astonishing’ developments in western Europe and the US”.

HN 8

North Moravia rail crash wounds 43

A head-on collision yesterday morning of two local trains in Paskov injured over 40 people after one of the drivers failed to see a stop signal.

most Czech press

Ministries looking into regional financing of medical fees

Interior Minister Ivan Langer will launch an investigation into how regional governments led by ČSSD will cover medical fees now that they are no longer paid by private citizens. A cabinet memorandum said the findings could lead to legal consequences. In the Hradec Králové region, for example, officials are diverting money from an anti-flood protection fund to pay the fees, while in Pardubice, officials will delay reconstruction of a home for the chronically ill. Finance Ministry will examine whether the gift tax law is being observed as some regions cover the health fees in the form of gifts.

most Czech press

Legerova street to lose one lane for six months

Jana Černochová, the mayor of Prague 2, has confirmed that part of Legerova street, a major Prague artery, will be narrowed from four lanes to three in an attempt to limit traffic. The closure will start 1 March and last six months. Officials are hoping many drivers will avoid the street after the measure is implemented. Some 100,000 cars use the street every day.

LN 6, Pd 1, 3

Clubs to provide own security during football matches

Football clubs will have to provide their own security at matches following an amendment to the police law in January. Only two major clubs, Jablonec and Sparta Praha, have CCTV security cameras. The spring leg of the football season opens this weekend with two potentially risky matches: Brno v Baník Ostrava and Sparta Praha v Sigma Olomouc. Police will continue to accompany fans from the train station to the stadium.

most Czech press

First guest workers apply for redundancy scheme

The Interior Ministry says dozens of redundant non-EU guest workers, most of them from Mongolia, yesterday applied for a new government programme to get a free flight back home and a EUR 500 bonus.

most Czech press

Ministers OK partial pension privatisation

The cabinet has approved a preliminary plan under which earners will be able to voluntarily divert part of their mandatory pension contributions to commercial pension funds.

LN 13, Právo 1, 17

Baroque vase found under Charles Bridge

Police scuba divers yesterday fished out of the Vltava River a baroque vase that was once part of the statue of St. Anthony of Padua that stands on Charles Bridge. The divers, in cooperation with archaeologists, are trying to locate the sunken pillars of the Romanesque Judith Bridge, which pre-dated Charles Bridge, in order to establish its original location.

Pd 1, 4, MfD C1, C2

Czech ambassador to UK dies

Jan Winkler, the Czech ambassador to the UK and former deputy foreign affairs minister, yesterday died at age 51, the Czech Foreign Ministry said.

Právo 4


Crown falls below CZK 30/EUR

The Czech crown fell to as low as CZK 30.04 per euro at Raiffeisenbank yesterday, while the official exchange rate sank to CZK 29.20. The crown fell to CZK 22.80 against the US dollar. The drop has prompted electronics retailers and carmakers to talk about raising prices soon. Petrol prices are also on the rise.

most Czech press

Stimulus passes as unions talk of deep recession

Ministers yesterday approved measures designed to fight the economic downturn by cutting mandatory social contributions and changing corporate depreciation and taxation rules. The package will cost state coffers some CZK 70 billion, or 1.9% of this year’s GDP. Some analysts and business reps welcomed the move, while the opposition Social Democrats and unions called it insufficient. Union leaders yesterday warned that the Czech economy might face a contraction of up to 5% this year. The Czech Chamber of Commerce rejected the claim as political.

most Czech press

Cabinet to scratch income tax pre-payments for small businesses

The cabinet has added to its anti-crisis package a provision that sole proprietors and companies with less than five employees will not have to pay their income tax instalments in advance this year in order to give them more operating cash. They’ll still have to pay taxes at the end of the year, which Bedřich Danda, head of association of entrepreneurs (SPČR), says will not help them much. The package must now be approved by parliament.

most Czech press

PPF buys into J&T industrial unit

Billionaire Petr Kellner’s PPF and the Czech-Slovak private equity group J&T have signed a deal to set up a joint venture on Friday. PPF will pay CZK 6 billion for a 40% stake in J&T’s energy and manufacturing operations. Daniel Křetínský will hold a 20% share in the venture and will be in charge of management. J&T has also launched four new ventures within the group, including one for developing the High and Low Tatras region.

HN 13, 14, 15

MfD: ČEZ electric bills 6%-13% lower in 2010

Electricity from the energy giant ČEZ could be as much as 6% to 13% cheaper next year, according to the latest price calculations of ČEZ management to be introduced today, Mladá fronta DNES reports. It is not known whether Pražská energetika and E.ON are taking similar steps. ČEZ is reacting to falling electricity prices on world markets.

MfD A1, B1, B4

Czech officials warn EU against protectionism

Speaking at the European Parliament (EP) yesterday, Czech Finance Minister Miroslav Kalousek reiterated his warnings against protectionism and excessive public debt that might result from government stimulus packages. In an apparent hint at French President Nicolas Sarkozy’s recent proposal that French carmakers should move overseas plants back to France, Czech Senate speaker Přemysl Sobotka spoke against “protectionism, social engineering, Napoleonic visions of some politicians and national economic egoism”.


Blue chips hit five-year low

The Prague Stock Exchange’s PX index of 14 premium stocks yesterday tumbled 3.4% to 699 points, the lowest rate since February 2004.

HN 13, 20, Právo 1, 17

Czech Railways posts drop in cargo volumes

ČD Cargo, the freight unit of state-run Czech Railways, last year moved 86.2 million tonnes of freight, 6% less than in 2007.


Residential construction declining

Builders started construction of 9,686 homes in October to December, 19.1% fewer than a year earlier, and home completions were down 30.4% at 12,397. For the whole year, home starts were down 0.6% and completions down 7.8%, according to the Czech Statistical Office. The whole construction sector last year grew by just 0.6%, the slowest rate since 1999, with December same-price output down 2.6%.

Právo 17, E15 10

Ski worlds not seen helping Czech economy

Analysts interviewed by ČTK agree that the world championships in Nordic skiing starting this week in north Bohemia may benefit businesses in the Liberec region, but will not help the Czech economy as a whole.


Euro seen hurting Slovak tourism

The Slovak tourist industry has reported slowing demand, especially from Czech visitors. Mag Consulting’s Jaromír Beránek says this is partly because Slovakia has adopted the euro, while other central European currencies have weakened.


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