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Breakfast Brief – 27 May 2009

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Table of Contents

Janota wants to trim public sector
New Finance Minister Eduard Janota wants to freeze hiring on 13,500 of the 18,000 currently empty public jobs as a way to save CZK 5 billion. The move would cut teachers’ wages by CZK 800-900 per month and prevent the ministries of the interior, defence and justice from hiring 2,000 new police, 1,500 soldiers and more than 1,000 court staff.
HN 4

ODS denounces egg attacks on Paroubek
Civic Democrat leader Mirek Topolánek yesterday denied that his party was responsible for eggs being thrown at ČSSD head Jiří Paroubek. ODS deputy chair David Vodrážka called on Paroubek’s opponents to refrain from such attacks. Later that day, Paroubek had to shield himself with an orange umbrella as six more eggs were thrown his way. Paroubek’s request to the prime minister and interior minister that police guard his meetings has been rejected.
most Czech press

MPs to vote on new government on 7 June
The Chamber of Deputies is scheduled to vote on its confidence in PM Jan Fischer’s interim cabinet on 7 June, right after the European Parliament elections.
most Czech press

Lawyers say some deportations are illegal
Hoang Quan and Nguyen Dam, who overstayed their visas, were deported to Vietnam in April, before their appeals could be heard in court. Their Czech lawyers say this constitutes a violation of a recent Czech-Vietnamese agreement. Police have recently adopted stricter measures against illegal immigrants. The Interior Ministry offers to pay for a flight for those guest workers who want to go back home, an option few Vietnamese have used so far.
HN 5

Moravian school drops separation of Roma
A primary school in Valašské Meziříčí will not segregate Romani pupils into their own class as previously planned. The decision was made after an inspection by the ministries of education and human rights. While the school’s director, Otto Medek, said the aim was mainly to attend to the specific educational needs of children from socially disadvantaged environments, the plan was opposed by various nonprofit organisations and ministries.
LN 1, 3

Kalousek registers logos for new party
Former Finance Minister Miroslav Kalousek has registered seven different logos for a new party that he plans to start following his recent split with the Christian Democrats.

Mayors say funding of town halls is unfair
Mayors of several hundred smaller municipalities yesterday called on the government to revise the existing regulations under which large cities get significantly more funding per resident from the state budget than municipalities of fewer than 100,000 people.
most Czech press

Neo-Nazis get jail for Hitler salute
A court yesterday sent two young men to jail for 18 months and six months, respectively, for making straight-arm, open-palm salutes before a Nazi flag in a private video shot several years ago.
HN 1, 5, Právo 7

Topolánek rated poorly, but may win EP voting
In a STEM survey, half of those polled have given Mirek Topolánek’s former cabinet the two worst Czech school marks, 4 and 5, while only 22% gave 1 or 2. Still, recent surveys show that Topolánek’s Civic Democrats will beat the Social Democrats in the elections for European Parliament.

ČR slow to clean up dangerous chemicals
The Czech Republic may face EU sanctions as well as further environmental damage as firms will probably not be able to meet a deadline to register and dismantle equipment that uses poisonous polychlorinated biphenyls, researcher Dagmar Sirotková said yesterday. Under EU directives the deadline is 2010.

Headmaster quits over child porn
The principal of two Prague primary schools resigned yesterday after being charged for having child pornography at home and at work.

Memorial for Heydrich assassins to be unveiled today
A memorial to commemorate Jan Kubiš, Josef Gabčík and the 293 others who supported them in their attack on SS-Obergruppenführer and Deputy Protector of Bohemia and Moravia Reinhard Heydrich on 27 May 1942 will be put on display today at the assassination site in Prague 8. Supporters of the memorial have fought for its construction since 1945.
MfD A4

Led by Tesco, supermarkets thrived in 2008
Sales at the 50 largest retailers in the Czech Republic totalled CZK 446.9 billion last year, 9% more than in 2007, according to figures by Incoma Research. Tesco took over from Ahold as the country’s largest chain. Sales at each were estimated at CZK 47 billion and CZK 44 billion, respectively.
most Czech press

‘Nightmare’ on the steel market
Sanjaj Samaddar, CEO at ArcellorMittal Ostrava, has called the current downturn in the steel business an unprecedented “nightmare”. The top Czech steelworks is now using only 35-45% of its production capacity and plans to suspend more operations in June and move some production across the border to Poland’s Sosnowiec. Samaddar has ruled out reports in the Financial Times that ArcellorMittal may close down the Ostrava subsidiary entirely.
HN 17

Czech Post will lay off another 650
Czech Post has announced plans to make 650 staff redundant by August, mostly at the company’s Prague headquarters. The second-largest state-run employer already fired 1,300 last autumn; it now has 37,000 employees.
HN 1, 20

Banks cut loans to Jablonex
An unnamed source has told E15 that banks are reluctant to continue providing loans to the glass and bijou producer Jablonex Group after the company failed to find a strategic investor in the first round of searching. The group has now re-entered cooperation with PricewaterhouseCoopers and is looking for an investor that would acquire the enterprise as a whole. Jablonex is currently at a 60% production level and has laid off 2,200 employees out of 3,900.
E15 1, 8

RSJ Invest to enter Eurex, has made CZK 1bn
Karel Janeček, owner of the financial derivatives firm RSJ Invest says his company has already earned more than CZK 1 billion and is planning to enter the Eurex stock exchange. Janeček also said the company has decided not to continue trading its clients’ assets.
MfD B4

Lender sees Q1 business slump 16%
Home Credit provided consumer loans worth just under CZK 2 billion in the first quarter of the year, 16% less than in 2008, as the overall consumer credit market dropped 17%. CEO Erich Čomor said that Czechs fear unemployment and postpone larger purchases “for better times”.

Madeta announces plans to slim down
Top Czech dairy Madeta has laid off 130 employees and will make 70 more redundant, as well as selling some assets and cutting bonuses, CEO Milan Teplý said in an interview with HN yesterday.

Consultant: Most bankruptcies yet to come
Deloitte ČR’s Josef Kotrba yesterday expressed opinion that Czech businesses are still awaiting the main wave of corporate insolvencies and loan defaults. He added that the current bankruptcies are mostly not caused by the global recession, but result from the firms’ own past mistakes.

Penta believes it will win Polish tender
The Czech aircraft maker Aero Vodochody will likely win a tender to take over the Polish helicopter manufacturer PZL Świdnik, a director of Penta Investments, which owns Aero, said yesterday. Aero’s competitor is the Italian-British firm AgustaWestland.

Hochtief fights default suit
A court has terminated insolvency proceedings against the construction firm Hochtief CZ after Alga cz, a subcontractor, withdrew the CZK 700,000 debt claim it had raised against the company last week.

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