Czech Foreign Minister Karel Schwarzenberg said on Thursday the Czech Republic should not distance itself from the eurozone’s debt crisis but pull its weight in helping to resolve the problem. Speaking at a conference of Czech foreign policy, Mr. Schwarzenberg said that this was a time for solidarity from all EU members, because all were in the same boat and a crisis in the eurozone would sooner or later affect everyone. The Czech Republic has taken a cautious stand to developments in the monetary alliance, and the ruling Civic Democrats have even thrown their weight behind the idea of holding a national referendum on euro adoption.
The Czech lower house approved the 2012 state budget in its first reading late Wednesday, nodding to its basic parameters: budget revenues, expenditures and deficit. The draft budget, pushed through by the votes of the centre-right coalition government of Civic Democrats, TOP 09 and Public Affairs, reckons with revenues of 1,085 billion crowns, expenditures of 1,190 billion and a 105 billion crown deficit, i.e. 3.2 percent of GDP. The draft budget, fiercely criticized by the opposition, will be now discussed by the lower house's committees. The house is to take a final vote on it in December.
The opposition has slammed the government for putting forward a draft budget based on unrealistic growth figures. The budget was tailored according to a June forecast predicting a 2.5 percent growth in 2012. That estimate has been revised sharply down to a 1 percent growth estimate at best. The ministry says it will revise the budget in January when it has a more accurate growth forecast for that year. The lower growth would cause the expected revenues to drop by around 18 billion crowns. The ministry is said to be working on several crisis scenarios, including one for recession.
According to Thursday’s Lidove Noviny Finance Minister Miroslav Kalousek is seriously considering the possibility of postponing the government’s pension reform by a year –from January 2013 to January 2014. The paper suggests that the minister may use the concession as a means to break the obstruction tactics of the opposition and open the way for another half a dozen reform bills to pass through the lower house after their rejection by the Senate. The opposition, which argues that in view of the economic situation the government should put some of the planned reforms on ice, has been obstructing a vote on the respective bills since Tuesday.
The Czech Central Bank on Thursday also confirmed the bleak economic outlook, revising its growth forecast for 2011-2012 downward, mirroring an economic slow-down in Europe. The bank predicts a 2 percent growth this year, down from a previous 2.1 percent growth estimate and 1.2 percent growth in 2012 down from a 2.2 percent forecast. The downward revision echoes a similar estimate by the Czech Finance Ministry announced earlier this week. The Central Bank board on Thursday voted to leave the benchmark two-week repurchase rate at a record-low 0.75 percent, half the European Central Bank’s main rate.
Analysts predict a rise in unemployment in the coming months both due to the end of seasonal work and the gloomy economic predictions that will inevitably result in more lay-offs. The jobless rate, which has stagnated at around 8 percent for some time is expected to climb by one percentage point, possibly more, in the coming months depending on the economic slowdown in Europe.
Police have classified a Romany attack on two teenagers in the town of Nový Bor as racially motivated. The incident took place last Friday outside the local cinema. An 18-year-old boy and a girl of 15 ended up in hospital with concussion, a broken nose and head injuries. They were attacked by Romany youths of approximately their own age. Another attack occurred in the town less than 24 hours later when unknown culprits beat up a twenty-year-old man. Racial tension has been high in Nový Bor since August of this year when a group of Romanies attacked guests in a bar with machetes. The towns inhabitants have criticized the local administration for failing to secure law and order and anti-Romany demonstrations have been taking place on a weekly basis. Following the latest attacks the town has once again received police re-enforcements.
Ten guests staying at a Prague 5 hotel have been taken to hospital with food poisoning. Others who suffered a milder form of food poisoning were attended to on the spot. All are said to be in stable condition. Eight of the patients are believed to be contestants in a beauty pageant. Tests are being conducted to ascertain the cause of the problem.
A group of around 100 students and civic leaders from the Moravian town of Moravsky Krumlov on Thursday demonstrated outside Prague Town Hall in a last-ditch attempt to convince councilors their home town should be allowed to keep the Slav Epic – an impressive collection of outsize paintings by Art Nouveau painter Alfons Mucha. The tug-of-war over the collection has been going on for over a year ever since the city of Prague decided to claim its legacy from the Art Nouveau painter, despite the fact that it has not yet fulfilled the condition under which Mucha bequeathed the paintings – that they would be displayed in a pavilion specially built to accommodate them. While the demonstration in Prague had little effect there are reports claiming that 5 more canvasses from the 20 strong collection have already been packed and sent on their way to the Czech capital.
U.S. General Timothy Ray, who is in charge of building an Afghan air force, has praised the Czech Republic’s input in training Afghan helicopter pilots. In an interview for the CTK news agency the general said the work of Czech instructors was excellent and the skill of Czech mechanics who have experience with Russian military equipment was proving invaluable. Czech military experts are teaching Afghan pilots to fly Russian-made Mi-17 helicopters and maintain them, both in the Czech Republic and in Afghanistan. The Czech Republic has aspirations to establish a NATO helicopter pilot training centre in Pardubice, east Bohemia.