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Breakfast Brief – 25 November 2009

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Table of Contents

E15: Füle’s chances still high for Czech EU commissioner
Questions put by the European People’s Party to the Czech EU commissioner candidate Stefan Fülle about his past Communist party ties would not stand in the way of his election, E15 reports, quoting an unnamed source. According to former foreign affairs minister Alexandr Vondra, Füle’s appointment doesn’t pose a security risk.
Source: most Czech press

Chief health officer: ČR swine flu vaccine is safe
A swine flu vaccine from GlaxoSmithKline (GSK) which caused abnormal allergic reactions in Canada is not being delivered to the Czech Republic, the country’s chief health officer Michael Vít said yesterday. Almost half of the staff at two Czech hospitals refused to be vaccinated yesterday when the latest wave of swine flu inoculations for healthcare workers began.
Source: most Czech press

TOP 09 to choose leadership this Saturday
Newly established conservative political party TOP 09 will meet this weekend to elect its chief officials, including the party chair. The lead candidate for the top post is former foreign affairs minister and current senator Karel Schwarzenberg. 170 delegates will decide on the party leadership on Saturday.
Source: ČTK

Report: 30 Czech roads pose serious risk
Almost 30 sections of high-speed roads in the Czech Republic pose substantial danger to drivers, according to a new risk map released by CityPlan yesterday at a national conference on road traffic. The map is available at
Source: MfD A1, A4

Opencard costs climb to CZK 888m
Prague City Hall’s Opencard project set up last year to make more city services accessible has so far cost CZK 888 million, and no profit has been made, Deputy Mayor Rudolf Blažek told reporters yesterday, referring to the latest project audit. Opencard revenues were reportedly expected to reach CZK 837 million at the end of this year. The auditors called the estimate unrealistic, blaming the council’s IT department for the poor result.
Source: most Czech press

Poll: One-third of Czechs offer doctors ‘inducements’
A survey by NGO Transparency International (TI) says up to one-third of Czechs offer doctors small gifts, mostly as a reward for services, while about 3% of respondents admit they have given a bribe to a doctor exceeding CZK 50,000, TI director David Ondráčka told a conference yesterday on state healthcare corruption. He criticized hospitals’ investments in medical equipment as inefficient.
Source: ČTK, MfD A2, LN 5

NGO blasts Veterans’ Day awards for politicians
Anti-corruption NGO Růžový panter criticised the Defence Ministry yesterday for awarding honours to several politicians including MP Jan Vidím and head of the president’s office Jiří Weigl on Veterans’ Day this year. Hospodářské noviny reports the ministry was unable to give reasons why these medals were awarded.
Source: HN 4

More high schools drop entry exams to keep students
Only 12% of Czech secondary schools will require new students to pass entrance exams, while two-thirds of high schools will accept new students based on their final primary school report cards, the Institute for Information on Education said yesterday. The changes should ensure that high school pupil numbers remain solid in light of an overall decline in the student population.
Source: Právo 3

Court rules out actor’s ties to StB
A Prague court found yesterday that well-known actor Jan Kanyza had been wrongly accused three years ago of giving information to the Communist secret service (StB). Although the court ruled that proof of cooperation was weak, Zdeněk Cvejn of the Interior Ministry said that Kanyza had made verbal arrangements with the StB.
Source: HN 5, LN 1, 4

EC launches anti-trust probe of ČEZ, J&T
The European Commission is investigating Czech companies, ČEZ and J&T, on suspicion that the energy giant and the financial group might have influenced wholesale prices on the national electricity market and brown-coal trading through their joint activities. The investigation is allegedly based on a complaint filed by Czech Coal. ČEZ stock value dropped 2.55% overnight to close at CZK 861.5 per share. The headline PX index lost 1.2% on news of the probe to end at 1,140.70 points.
Source: most Czech press

FBI to investigate claims of Erste corruption
Two former Erste Bank managers Hans Leitner and Peter Andahazy, who were both sacked after alleged illegal gold trading, have filed a complaint with the FBI about the privatisation of Česká spořitelna in 2000. The managers claim bribes were paid to top politicians, including the then finance minister, Czech National Bank governor, and ODS deputy chair to facilitate the deal, Hospodářské noviny writes. They also highlighted similar practices in other acquisitions in central Europe. Erste spokeswoman Hana Cigonková told HN the bank had received a letter from both men offering to keep silent if the bank paid them EUR 30 million.
Source: HN 6, MfD B4, ČTK

Experts: Motorway costs in ČR too high
Czech motorway construction costs exceed the average in other European countries due to corruption, lobbying and a bad legal framework, participants at a seminar on road construction agreed yesterday. Official data shows one kilometre of motorway in the Czech Republic costs CZK 227 million on average, however, some analysts put the figure at close to CZK 1 billion. Mladá fronta Dnes reports that consortiums have had rising success in public tenders since 2005, naming Skanska, Eurovia, Strabag, OHL ŽS, and Metrostav as leading players.
Source:, MfD B4, Právo 15

Student Agency mulls EC complaint over train tender
Student Agency is considering filing a complaint with the European Commission over the suspension of a public tender for a train operator in the Plzeň region. The region eventually gave the train contract to Czech Railways (ČD) under a deal to be completed on 2 December. Student Agency head Radim Jančura argues that using his company’s services would save the regional budget some CZK 40 million annually.
Source: ČTK

Czech Post expects profit CZK 500m in 2009
Czech Post should close the year with a profit between CZK 400 and CZK 500 million, Director General Petr Sedláček said yesterday, crediting reduced costs from investments and operations for the far better-than-expected result. The company has launched a new data mailbox system, with plans to start notifying recipients of registered mail via SMS or email. For the first time, the company will also hire more vans to help distribute mail during Christmas.
Source: HN 17-19

HN: Litigation threatens ArcelorMittal-PPF deal
Plans by steel giant ArcelorMittal to acquire a 14% stake in ArcelorMittal Ostrava (AMO) from Petrcíle, a subsidiary of financial group PPF, for CZK 7 billion are under threat, according to Hospodářské noviny. The daily reports allegations by entrepreneur and former Petrcíle owner, Petr Nádvorník, that the company had been stolen from him under the proposed transaction. The High Court is dealing with the case now, HN writes.
Source: ČTK

ČEZ leads capital markets survey
Energy giant ČEZ claimed first place in the latest EVA rankings by Czech capital market information agency ČEKIA, which compares firms’ financial performance based on their annual profit results. Mobile operators Telefónica O2 and T-Mobile and carmaker Škoda Auto finished next on the ladder. Mining firm OKD recorded the biggest improvement to snatch 12th place, after adding CZK 1.2 billion to its value this year.
Source: most Czech press

Analysts put ECM loss at CZK 684m in Q1-3
Developer ECM’s loss for the first three quarters of this year may rise to CZK 684 million, up from CZK 563 million last year, analysts told ČTK yesterday. Company head Milan Janků confirmed that the company would likely post a loss for the whole of 2009. ECM may have to raise its share capital or start selling assets to avoid paying off bonds ahead of schedule, Atlantik FT analyst Patrick Vyroubal said.
Source: ČTK

Orco records new shareholders
New names have been registered on the shareholder list of developer Orco, including financial groups Fio and I.F.B, a member of the Swiss IFB Group. Both of these companies had a 2.03% share in Orco on 20 October, according to Orco’s website.
Source: HN 25, LN 18

First Czech gluten-free beer hits the market
Brewing master Tomáš Hub at Zámecký minipivovar microbrewery in Ostrava-Záhřeb yesterday introduced the Czech Republic’s first gluten-free beer. The new beer Pikard is made of corn instead of malt and has only 2% alcohol content. About 50,000 Czechs are affected by Coeliac disease, according to Eliška Dufková of the Czech Coeliac Society.
Source: MfD A5

Survey: ČR’s no 1 restaurant serves up tradition
The Grand Restaurant 2010 survey has rated Prague-based La Degustation Boheme Bourgeoise as the top restaurant in the country. The establishment’s head chef Oldřich Sahajdák said he takes inspiration from traditional Czech cookbooks and family recipes, and that with quality ingredients, Czech cuisine can be first rate.
Source: LN 1

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