This year’s deficit of Czech public finances should not exceed 3 percent of gross domestic product, Finance Minister Miroslav Kalousek said on Friday. Mr Kalousek’s remarks came in a reaction to an estimate by the European Commission which predicted the deficit would reach 3.1 percent of the country’s GDP. Keeping the gap below 3 percent would bring an end to the excessive deficit procedure launched against the Czech Republic by the European Commission in 2009, Mr Kalousek said. The finance minister however warned the target could only be met provided that European economy does not experience any dramatic downturn.
In Business News this week: The Czech economy is passing through the lowest point of the recession, says the head of the central bank; the EC predicts the Czech economy will stagnate in 2013; CEZ and Czech Coal are reported to be close to a deal worth a whopping CZK 200 billion-plus; 40,000 Czech customers file a class action for the return of bank charges; and a fifth of Czech medicines are being resold in more expensive markets.
President-elect Miloš Zeman has slammed the Czech government for not doing enough to defend the position of the Czech power utility ČEZ in Bulgaria. Mr. Zeman said it was the duty of any government to defend its companies abroad and urged the Nečas administration to use all the means at its disposal – such as EU contacts, international arbitration mechanisms and negotiations with the outgoing Bulgarian government – to defend Czech national interests. The state-owned power utility may lose its license in Bulgaria following mass protests over electricity prices. President Václav Klaus has also criticized the Czech government for taking what he called “a passive stand” in the dispute, saying that ČEZ has been made a scapegoat for the growing social unrest in Bulgaria.
Government officials have rejected the criticism. Trade and Industry Minister Martin Kuba said that it was primarily up to ČEZ to prove to the Bulgarian authorities that it had not violated any public procurement rules or any other norms. The Czech government, he said, would only make sure that the administrative proceedings against ČEZ were not politicized. Meanwhile, Foreign Minister Karel Schwarzenberg said he had discussed the matter both with Bulgarian Foreign Minister Nikolay Mladenov and EU officials in Brussels. Diplomacy is conducted behind-the-scenes, he noted.
The Bulgarian energy regulator announced on Wednesday morning that although proceedings aimed at revoking the distribution license of Czech energy company ČEZ have been launched, a final decision has not been made. The regulator announced that it will continue to look into possible wrongdoings and will hold hearings with the company’s shareholders in April. Czech Finance Minister Miroslav Kalousek denied the allegations of the Bulgarian authorities that ČEZ broke a number of regulations while operating in the country.
The Bulgarian operation of the Czech state-controlled energy firm ČEZ has run into serious problems after Bulgaria’s energy regulator launched proceedings to revoke its licence to operate in the country. The decision came after nationwide protests against high electricity prices centred on the Czech company which controls around 40 percent of Bulgaria’s electricity distribution market. On Wednesday, Bulgarian Prime Minister Boyko Borisov announced his cabinet was stepping down after 14 protesters were injured in clashes with the police. Ilin Stanev
The authorities in Bulgaria are planning to strip the Czech power giant CEZ of its distribution license in the country on Tuesday, Bulgaria’s Focus news agency reported, referring to a statement made by the country’s prime minister, Boyko Borisov, at a news conference in Sofia. People in Bulgaria have been protesting against what they regard as the excessively high prices for electricity charged by CEZ and an Austrian company. An analyst told the news website iHned.cz that a forced exit from Bulgaria could cost CEZ as much as CZK 15 billion.
Reacting to developments surrounding CEZ's position in Bulgaria, the Czech prime minister, Petr Nečas, said on Tuesday that he expected that Bulgaria, as an EU member, would adhere to its international commitments and treaties regarding the protection of investments. Mr. Nečas said he believed the dispute over electricity prices had become politicised and said comments made by Bulgarian officials were out of the ordinary. Speaking in Brussels, the Czech minister of industry and trade, Martin Kuba, said the situation was alarming, adding that he was prepared to discuss the matter with the European Commission.
The Bulgarian authorities are looking into the electricity prices charged by Czech and Austrian power distributors following an avalanche of complaints from the public. Energy Minister Delyan Dobrev said that once it had the results of an audit the government would make a final decision on whether there are grounds for revoking their licenses. Tens of thousands of people took to the streets across the country on Sunday to protest against what they call excessive electricity prices set by the Czech power distributor ČEZ and the Austrian energy company EVN. There have even been demands for the country’s distribution network to be nationalized. ČEZ claims that the higher electricity bills in January reflect higher consumption over the Christmas holidays and a colder-than-usual winter. ČEZ recently had its license revoked to operate Albania’s national grid after drawn-out disputes over tariffs and unpaid bills.
Massive street protests continued for a second weekend in Bulgaria where people are demonstrating against what they call excessive electricity prices set by the Czech power distributor ČEZ and the Austrian energy company EVN. Over 3,000 demonstrators stopped traffic in the Bulgarian capital Sofia on Sunday chanting “out with the mafia” and demanding that the country’s distribution network be nationalized. ČEZ claims that the higher electricity bills in January reflect higher consumption over the Christmas holidays and a colder-than-usual winter. ČEZ recently had its license revoked to operate Albania’s national grid after drawn-out disputes over tariffs and unpaid bills.
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