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Czech finance minister warns of ballooning public deficits in EU

The Czech presidency of the European Union has urged member states to rein in their growing public deficit as soon as the economic crisis allows. Chairing a meeting of EU finance ministers devoted to crisis management, the Czech finance minister, Miroslav Kalousek, said that the coordinated fiscal stimulus now taking place must be followed by a coordinated effort to cut public deficits as soon as circumstances allow. The 27-member block agreed last December to pump 200 billion euros into their economies in the hope of minimizing the impact of the recession and public deficits, which are normally kept under 3 percent of GDP, are ballooning. The European Commission is expecting the combined EU shortfall to reach 4.4 percent of output in 2009. At least 12 member states are expected to go over limit this year.

Czech government sends fact-finding mission to Gaza

Three Czech experts have left for Israel and the Palestinian territories in order to assess the humanitarian needs of people hit by the war in the Gaza Strip. The team was sent out by the Czech EU presidency ahead of a foreign ministers’ meeting in Brussels on Wednesday which is also to be attended by Israeli representatives. The EU is currently seeking ways to consolidate the ceasefire, improve humanitarian aid, restore electricity and water supplies and stop arms smuggling into Gaza.

Part of Entropa artwork covered up at Bulgaria’s request

The Czech representation in Brussels has complied with Bulgaria’s request for its section of the controversial Entropa artwork, in which the country is pictured as a land of squat toilets, to be covered up. Created by Czech artist David Černý to mark the start of the Czech presidency, the symbolic map depicts the 27 member states through a variety of crude stereotypes that have sparked both amusement and anger. Czech Deputy Prime Minister for European Affairs Alexander Vondra apologized last week for any offense the work may have caused. Entropa has been a source of embarrassment to Czech officials in Brussels after it emerged that artist David Černý duped the government into thinking that he was working on the project together with artists from the 26 other member states.

Industry minister welcomes resumption of gas supplies

Czech Industry Minister Martin Ríman on Tuesday welcomed the resumption of natural gas supplies from Russia but said that Russian gas must flow through Ukraine to Europe for at least three days before the crisis can be considered well and truly over. The Czech EU presidency led the talks aimed at resolving the gas dispute between Russian and Ukraine, but its efforts were repeatedly thwarted by fresh controversy between the two neighbour states. The drawn-out disputes over pricing and payment have led the EU to consider a diversification of its energy supplies.

EU officials to meet with Afghan foreign minister

EU officials are scheduled to meet with Afghan Foreign Minister Rangin Dadfar Spanta for talks in Prague on January 28. According to a Czech government statement the talks will focus on the relationship between the EU and Afghanistan, the situation in Afghanistan and regional ties. The EU will be represented by Czech Foreign Minister Karel Schwarzenberg and by EU external relations commissioner Benita Ferrero-Waldner.

Ambassador Graber returns home

US Ambassador Richard Graber on Tuesday ended his diplomatic mission to the Czech Republic and returned home. A Republican, Mr. Graber resigned from his post following Barack Obama’s victory in the US presidential elections. The US Embassy in Prague said Mr. Graber’s successor would be appointed within the next few months.

Public mass for architect Jan Kaplický

A public mass for architect Jan Kaplický, 71, who died in Prague last week is to be held at the Church of St. Anne in Prague’s Old Town next Tuesday. The actual funeral is to be a private affair for family and friends. Mr. Kaplický died of heart failure last Wednesday, just hours after the birth of his daughter Johanka. In 2007 Kaplický’s design consultancy, Future Systems, won an international design competition for a new building of the Czech National Library in Prague, which would have been Kaplický's first building in his homeland. However the project sparked enormous controversy and its future remains uncertain. Since his death 15,000 people have signed a petition for the so-called Octopus or Blob to be built.

Czechs starting to feel the pinch

Retail sales sank by 6.3 percent year-on-year in November, hitting the biggest low since December 1998, the Czech Statistical Office said on Tuesday. Analysts say that the situation on the labour market is changing and many Czechs have curbed their spending for fear of growing unemployment. The November figures indicate that the recession has made households cautious in their spending mainly of durable goods.

Finance minister wants to boost business with reduced VAT rate

Czech Finance Minister Miroslav Kalousek is considering introducing a reduced VAT rate - from 19 to 5 percent - on certain labour intensive services, such as catering, construction and hairdressing. He told Tuesday’s Hospodarské noviny that direct tax cuts would be a good way to boost the economy, but since they were not politically feasible he was now considering a reduced VAT rate instead. The minister said this would have to be discussed within the EU, but that he first wanted to know the opinion of the newly established National Economic Council which is to help draft a rescue package for the economy.


The next few days are expected to be overcast with rain or sleet showers and day temperatures between 0 and 4 degrees Celsius.