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Simeon Mitropolitski

Simeon Mitropolitski is a Canadian analyst, of Bulgarian origin, and a former syndicated columnist with the Bulgarian News Agency (BTA). He is the author of several hundred articles dealing with hot political and economic topics, both national and international.

He was part of the first group of Bulgarian intellectuals and students that began the opposition movement that finally put an end to the communist regime in this country in 1989, and in 1996-1997 participated in international observation teams during the elections in several Balkan countries - Romania, Albania and Bulgaria.

In 2002 Simeon and his family moved from Bulgaria to Canada where they live now in Montreal, province of Quebec. Simeon is a Master of Political Science from McGill University and a B.A. of Political Science and History.

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30 June 2006

Czech Republic: Eastern Euro-skepticism

© 2006, IRED.Com, Inc., Simeon Mitropolitski

The Czech Republic is by any standard among the most successful post-communist countries. It enjoys political balance between its Left and the Right-wing parties, social and ethnic peace, and economic growth. Yet this country is also among few to show growing skepticism regarding the prospects of EU to help the country reaching the economic level of most advanced West European nations. Unlike some other post-communist countries that look at the EU as a source of fresh investments and grants only, being ready to exchange these short-term economic bonuses for long-term political weight, Czech government would rather prefer having the EU political influence in its own domain restricted. It's a new phenomenon coming from post-communist EU member still economically in need of catching up with the most advanced Western nations.

The Czech Republic and the lands that constitute its territory now have been for a long time among the most industrially advanced in Europe. Up to the start of the World War II it was among the first 5-6 world industrial powers, surpassing economically countries like Japan, Italy, and Spain. If for some countries the communism was a period of strong industrial growth, for the Czech lands it was a period of relative economic and technological decline. The country that was once on the par with France and that had its automobile industry as early as 1895, it had later to compare itself economically with Hungary and Greece. The communism's overthrow was soon followed by peaceful divorce between Czech and Slovak parts of the federation. They both looked to the West for inspirations, but moved to the EU in different speed. The two parts joined the EU in 2004.

Unlike many other post-communist countries, the Czech Republic was always considered as an imminent EU and NATO member. There wasn't even a talk that there may be EU or NATO eastward enlargement without the Czech Republic being among the first to receive the letters of invitation. The West still feels a sense of guilt because of prewar 'Munich appeasement', which determines the lower than usual level of pressure coming from Brussels. Unlike many other post-communist countries still struggling to prove their 'Europeanness' by strictly following all EU directives, the Czech population considers itself 'European' by the virtue of birth. If for some other post-communist EU-hopefuls the real question is how to satisfy the EU, countries like the Czech Republic can question the very foundations of any new EU project the same way as United Kingdom or Denmark do.

Being a Euro-skeptic in Prague has its sound economic rational. The EU is both a free trade area and a supranational political organization. Tilting the balance of this structure toward its free trade dimension will enhance the relative weight of countries that are located strategically at the center of the main European transportation corridors like the Czech Republic. Within a free trade area it's the market that rules. Tilting the balance of the EU toward its supranational political dimension will reduce the market incentives and will give more power to those countries that have comparative economic disadvantages.

To illustrate this principle let's take something that deals with the investment flows among the EU countries. Right now the Czech Republic gains enormously from the fact that its workers can perform as well as the workers in Germany and Austria at the fraction of the labor costs in these richer EU countries. If the market is the only factor that really matters, then the Czech Republic will rightfully expect many more billions coming from EU countries into its industrial factories. If, however, the EU decides to deepen its integration, this relative market advantage may vanish. Countries that now feel 'outsourced' may decide to impose additional costs on countries that 'kidnap' their industries, thus eliminating their relative economic advantage. If for some new and poorer EU members more EU means more grants and investments, for countries like the Czech Republic more EU means less certain investments and more political conditions attached.

This Euro-skepticism explains partly the political vitality of parties that don't hide their negative attitudes toward further EU integration. The recent parliament election in the Czech Republic gave small victory to the leading among these political formations, the Civic Democratic Party. Its victory short of an absolute majority cannot turn the country away from the European mainstream. In fact, the Czech Euro-skepticism isn't at all about pulling the country away from the Union. It's more about halting the integration right where it's now, at the point where the EU still looks more like free trade area instead of supranational sovereign government. The good news for Prague is that such a halt is currently possible due to much more powerful Euro-skepticism coming from some older EU members like France. In this case the Czech Republic has nothing to worry about its own image within Europe; what it has to do is just to collect the fruits of its comparative market advantage and to hope that the big EU countries won't find common ground for further compromises.

Czech Republic country profile:
  • Area: 78,866 sq km.
  • Population: 10.2 million (July 2006 est.).
  • Population growth rate: -0.06% (2006 est.).
  • Net migration rate: 0.97 migrant(s)/1,000 population (2006 est.).
  • Life expectancy at birth: 76.22 years.
  • Ethnic groups: Czech 90.4%, Moravian 3.7%, Slovak 1.9% (2001 census).
  • GDP per capita: purchasing power parity $19,500 (2005 est.).
  • GDP real growth: 6% (2005 est.).
  • Main trading partners: EU countries (mainly Germany), China, and Russia.
  • Internet users: 5.1 million (December 2005)
(Sources: CIA World Factbook 2006, Reuters)

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See also the directory of companies providing real estate services in, and general real estate information of Czech Republic.

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