Wednesday News Briefing

PraguePost: PM Nečas confident on church restitution bill; Czech economy falls deeper into recession

CHURCH The church restitution bill has enough support in Parliament to override a potential Senate veto, Prime Minister Petr Nečas (Civic Democrats, ODS) said Aug. 15. The wide-reaching legislation proposes to compensate churches some 59 billion Kč over the course of the next 30 years, alleviating the financial burden of some 1,500 municipalities. The Senate, where the opposition Social Democrats hold a majority, began debating the government-proposed bill Aug. 15.  

SMOKING The Health Ministry is supporting a widespread ban on smoking in restaurants in a new bill, a ministry spokesman told the Czech News Agency (ČTK) Aug. 15. The bill would ban cigarette smoking in all pubs and restaurants, including outdoor seating areas, and heighten fines for establishments found in violation of the rules to up to 1 million Kč. Current legislation requires eateries to house separate smoking and nonsmoking sections.  

POLICE PM Nečas chastised Police President Petr Lessy in a public address Aug. 15, claiming the police chief was "playing an incomprehensible game" and antagonizing members of the Cabinet. Lessy had accused Interior Minister Jan Kubice of blackmailing him. Kubice subsequently filed a complaint against Lessy with the General Inspection of Security Forces (GIBS).  

Business

ECONOMY The Czech economy has fallen deeper into recession, according to preliminary figures from the Czech Statistical Office (ČSÚ) published Aug. 14. Gross Domestic Product (GDP) shrunk 0.2 percent between April and June when compared with the previous three months, which was the third straight quarter of contraction. On a year on year basis, economic performance was 1.2 percent lower. Analysts say the Czech economy - the second largest among post-Communist EU states - has been hit by weaker exports and harsh government-imposed austerity measures, including tax hikes and spending cuts. The decline came even though Germany, the Czech Republic's biggest trading partner, posted annual growth of 1 percent. Meanwhile, neighbouring Slovakia saw its economy expand 0.7 percent quarter on quarter and 2.9 percent year on year. Of the EU countries for which GDP data is available, only four states (Greece, Portugal, Italy and Cyprus) recorded worse results than the Czech Republic.  

OIL The MND Group, which is part of Czech oil magnate Karel Komárek's KKCG Group, has entered into a joint venture with the Guernsey-based firm Blake Oil and Gas to fund development and appraisal activities in Georgia, daily Hospodářské noviny reported Aug. 15. Under the terms of agreement, MND will obtain a 50 percent stake in three of Blake's subsidiaries in the country: Ninotsminda Oil Company, Canargo (Nazvrevi) and Canargo Norio. The deal represents KKCG's largest ever foreign investment, with the Czech firm pledging to plough in 2 billion Kč ($99 million/80 million euros) over the next three years. A large proportion of this sum will be used to increase production at the Ninotsminda oil field.  

TRAINS Private Czech rail firm RegioJet has been forced to delay the opening of its planned routes to Germany after negotiations with the country's national railway Deutsche Bahn (DB) appeared to hit a stumbling block, daily Mladá fronta Dnes reported Aug. 15. RegioJet has been involved in exclusive talks with DB regarding the Prague, Dresden, Berlin and Hamburg line, which is currently operated by the state-subsidized Czech Railways. RegioJet had expected to begin operating the line in 2014, but that start date has now been pushed back by at least a year. Neither party would disclose the reasons for the delay.