The Moody's bond rating agency has confirmed the Czech Republic´s A1 rating with a stable outlook. In doing so, the agency praised the Czech government’s commitment to fiscal consolidation amid an unfavourable macroeconomic situation and, to a degree, Europe´s debt crisis. Last year, the government's austerity measures reduced the general deficit to 3.1% of GDP. Moody´s said that further effort would be difficult, however, because the Czech economy has been weakening since the third quarter of 2011. For this year, Moody´s expects the Czech GDP to fall by 0.6% and expects the government will manage to cut the budget deficit to 2.9% in 2013.
Police have dropped charges against a Czech pilot and key witness in the
CASA planes scandal. Karel Daňhel was arrested on Tuesday on suspicion of
having committed a sexual offence. According to the new website iDnes.cz,
the alleged victim told police during investigation that she had invented
the story. She will not face charges, as her testimony was given five days
before her 15th birthday.
The pilot had reportedly been providing police with information regarding suspicions he had regarding the CASA purchases. Daňhel has reportedly claimed that defence deputy Martin Barták exerted pressure to purchase the overpriced CASA military planes. The head of military intelligence chief is said to have told parliamentarians that Daňhel was taking kickbacks from the arms producer involved in the purchase, Omnipol.
The Senate has approved a bill requiring phone operators and internet providers to record data on personal electronic and mobile communication. The Czech Interior Ministry, which drafted the bill, hopes it will help fight organized crime by keeping a record of who called who, when, from where and for how long. Activists have said it will instead introduce a principle of ‘guilty until proven innocent’ into Czech law. The country’s Constitutional Court last year struck down a similar measure arguing that personal data retention was unconstitutional.
The police have issued another request for imprisoned MP David Rath to be given up for investigation in a separate case. Dr Rath is already awaiting trial in prison on charges of accepting a bribe and misusing EU funds. The new request reportedly involves three additional charges relating to health care facilities in Central Bohemia, where Rath was until recently governor, and his acceptance of bribe money. Police arrested David Rath in May after finding him with seven million crowns in a box. He will likely be allowed to address Parliament on the new charges on September 3.
Meanwhile, Finance Minister Miroslav Kalousek has produced documents that he says prove that his conversation with police president Lessy centred on the purchases and repairs of police vehicles and not the CASA transport plane controversy. The finance minister handed out copies of an official document in which the police president requests nearly 95 million crowns for the vehicles from the Interior Ministry. Mr Kalousek apparently received the documents from the interior minister, who had asked him for a finance assessment in May. The request was rejected.
The Czech Trade Inspectorate discovered 342 counterfeit shoes in a store in Prague's Narodní Třída, it was revealed on Wednesday. Fake brands, including Tommy Hilfiger, Holister, Abercrombie&Fitch, La Martina, Burberry and Lacoste were reportedly being sold with a total street value of 1 million crowns. The raid occurred last week and also involved experts in copyright law on the scene. Counterfeit goods continue to pose a challenge across the Czech Republic, particularly in the field of clothing.
The case of energy giant ČEZ using an armed “anti-theft unit” to recover debts has been definitively closed. Supreme State Prosecutor Pavel Zeman lost a complaint to the Supreme Court, in which he protested the suspension of the investigation into the group. Two years ago, 13 people were charged after shocking video footage emerged showing ČEZ controllers dressed like commandoes and carrying out paramilitary-like training for the purpose of collecting money from black market consumers. The Supreme Court has yet to publish its findings, saying only that agreed for the most part with the lower courts, which found that no crime had been committed.
Anti-corruption police have officially charged former defence minister and MP Vlasta Parkanová with mismanagement of state funds and abuse of office relating to the CASA military planes controversy. The police believe the procedure for purchasing the planes from Spain was illegal and that the state paid too much (3.5 billion crowns) for them. Independent assessments have spoken for and against her guilt; Mrs Parkanová herself says her conscience is clear. If convicted she could face up to ten years’ imprisonment.
President Václav Klaus has offered his support for embattled police president Petr Lessy, who is currently in a heated row with the prime minister and finance minister. Klaus met with Lessy at Prague Castle on Monday and told the press that it was the police president’s duty to protect the force from external influences. Prime Minister Petr Nečas accused Lessy of “political activism” on Tuesday in regards to a letter the police president issued to subordinates, called on officers to resist political pressures while investigating cases of corruption. The letter related to Lessy’s claims that he was pressured by Finance Minister Miroslav Kalousek over a controversial arms sale investigation. President Klaus said Wednesday that direct and indirect attacks on Lessy must stop and said the serious situation must calm down.
The lower house has approved the government’s so-called “second pillar” of the pension system. The legislation calls for the transfer of money from the state pension system to individual accounts in private insurance companies. People will also be able to transfer three percent of their social security insurance (currently 28%) to private pension companies on the condition that they add two percent on their own. The bill must now be approved in the Senate.
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