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Breakfast Brief – 20 May 2009

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Table of Contents

ČSÚ: Czech population will grow and age
The population of the Czech Republic will rise from 10.47 million today to 10.67 million in 2065, according to the Czech Statistical Office. Life expectancy by 2065 will rise from 74.2 to 86.5 years for men and from 80.3 to 91 years for women; the share of people over 65 will double. E15 quotes analysts as saying the ageing population will put pressure on the pension system, which could collapse if not reformed soon. They expect a first big influx of pensioners in 2015 and a second in 2045.
most Czech press

ČSSD posts plans for welfare state
Social Democrat leader Jiří Paroubek said yesterday his party will push for the minimum legal wage, set at CZK 8,000 a month since January 2007, to be increased regularly every year. The party also wants higher pensions, slower rent deregulation and more social housing, but ČSSD Deputy head Bohuslav Sobotka told Mladá fronta Dnes that some pre-election promises, such as increasing benefits for families with children, may have to wait until after the economic crisis has passed.
MfD A1, A12, Právo 1, 20

Photo sends three neo-Nazis to jail
In a breakthrough ruling, a court yesterday sent three men to prison for six to 14 months for posing in a photograph with a Nazi flag and giving Nazi salutes. The photo was taken at a private event at a bar in Teplice but later posted on the internet.

Paroubek calls on Havel to apologise for ‘concentration camp’ comment
ČSSD leader Jiří Paroubek said Václav Havel should apologise to the workers at Škoda Auto for his comment on Monday comparing making cars solely in order to employ workers to employing guards at a concentration camp. Havel refused, saying he chose Škoda at random and that the focus of the comment was to say that production should serve some purpose other than simply employment.
most Czech press

Brussels makes ads to boost election attendance
The European Parliament has prepared a media campaign to help boost voter participation at polls in the Czech Republic and 14 other EU countries this year and invested some EUR 18 million in the project, E15 reports. Only a fifth of Czechs say they will definitely vote in European parliamentary elections on 5-6 June, while half say they are thinking about it. The spots were delivered to Czech Television and radio stations for free.
E15 1, 7, HN 7

Topolánek: EU Presidency not affected by relations with Sarkozy
Former PM Mirek Topolánek denied in an interview for television France 24 that the Czech EU Presidency was affected by personal disputes between him and French President Nicolas Sarkozy. He did say, though, that “France has always had tendencies to govern the EU as a directorate”.
LN 7

Kalousek leaving KDU-ČSL over policy
Former Finance Minister Miroslav Kalousek told Rádio Česko yesterday he would either leave politics or start a new centre-right party. Kalousek criticised the Christian Democrats, a party he used to lead, for having moved too far left. “KDU-ČSL only differs from the socialists in that its members go to church,” he said.

Respekt cartoonist wins journalism prize
Pavel Reisenauer, a cartoonist and cover artist for the weekly Respekt, has received the 2008 K. H. Borovský journalism award. Czech Radio’s Lenka Kabrhelová and Czech Television’s Antonín Bruštík received awards for journalists under 33.

Two polls show ČSSD as election winner
If the general elections were held now, ČSSD would win with 32.4% of the vote according to STEM and 25% according to CVVM. The two agencies show, respectively, support for ODS at 23.7% and 19%, followed by the Communists (10.9% and 10%), KDU-ČSL (5.9% and 4.5%) and Greens (5.3% and 5%).
Právo 2

Soviet symbol will stay on Brno memorial
The Brno town hall yesterday voted down a request to remove a hammer and sickle symbol mounted earlier this year on a local Red Army memorial. Most councillors abstained from the vote.

Unipetrol cuts staff as parent struggles
Unipetrol will lay off some 8% of its more than 4,000 staff and close down some operations in a bid to save about CZK 1 billion, according to CEO Krzysztof Urbanowicz. Former CEO François Vleugels has warned the Czech petrochemical group might be dragged into serious difficulties by its cash-starved owner, Polish group PKN Orlen.

Prices for summer houses fall dramatically
Low demand for weekend houses has prompted a dramatic drop in prices for weekend cottages in the Czech Republic, according to an analysis by the real estate company Sting. Brokers say the drop was sparked by the economic crisis, stricter borrowing conditions and perceptions that prices will fall even further.
HN 17, 21

Škoda to invest EUR 2 billion in new model
Škoda Auto is developing a new small car to be based on the Volkswagen Up! city car and produced at VW’s Bratislava plant as of 2011, Škoda head Reinhard Jung confirmed to HN yesterday. In the next five years, Škoda wants to invest EUR 2 billion (CZK 54 billion) in the new model. Škoda Auto will reportedly make gearboxes for the Up! The firm will create 270 new jobs in Mladá Boleslav and invest CZK 1.5 billion in the expansion.
HN 1, 17, ČTK

Govt may cancel CZK 300m aid for Setuza
The new government will probably not approve an agreement for CZK 300 million in state aid for the food company Setuza that the company negotiated with former Agriculture Minister Petr Gandalovič. The regional governor for South Moravia, Michal Hašek, and the head of the Federation of Food and Drink Industries, Miroslav Toman, who nominated new Agriculture Minister Jakub Šebesta for his post, said similar aid could be claimed by other indebted companies, which would be costly, and that the aid could be regarded as illegal state intervention by the EU.
HN 1, 20

Small shareholders protest against squeeze-outs
More than 340 Czech firms have resorted to squeezing out their small shareholders since a relevant law took effect in 2005. Small shareholders have filed several complaints with the Constitutional Court, saying squeeze-outs run counter to the constitution and that buyout prices are too low, depriving them of an estimated CZK 20-30 billion.
HN 3

Estimate: Nearly 1,700 companies to go bankrupt this year
According to estimates of the country’s biggest private credit insurer, Euler Hermes Čescob, some 1,690 Czech companies will end up in bankruptcy this year, a rise of 25% from last year. Companies in the construction, textiles, metallurgy and auto sectors are at the highest risk.
LN 1, 15

Vítkovice steelworks CEO resigns
Vladimír Bail has resigned as CEO of the Russian-owned metallurgical firm Evraz Vítkovice Steel. His replacement is not yet known. Bail joined the firm 30 years ago as an apprentice.

EIB loans will help Czech SMEs
The European Investment Bank will lend at least EUR 200 million to Czech small and medium-sized businesses to help lessen the impact of the global economic downturn.

Crunch renews ‘DIYism’ among Czechs
Home Credit says the volume of loans used to buy DIY tools and material has almost tripled in the first quarter of 2009. The lender says people now try to save by doing home repairs and garden maintenance by themselves.

Poll: Most Czech firms cut pay
A Czech Confederation of Industry survey shows 61% of Czech firms have reduced salaries or bonuses to offset the impact of the global recession.

Paroubek wants Prague Airport sale halted
ČSSD leader Jiří Paroubek yesterday reiterated that Jan Fischer’s caretaker government should immediately suspend preparations for privatising the Prague Airport. He said the airport could be sold later under economically more favourable conditions.

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