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Country Commercial Guides
FY 2000: Czech Republic
CHAPTER III: POLITICAL ENVIRONMENT
A. Nature of the Political Relationship with the United States
U.S.-Czech relations are excellent and reflect strong historical ties. The United States and the Czech Republic cooperate on a wide range of issues, and the Czech Republic became a NATO ally in March 1999. The United States supports Czech participation in Western economic and political institutions and played a major role in facilitating the Czech Republic's transition to a market economy.
B. Major Political Issues Affecting the Business Climate
The Czech government is strongly supportive of foreign investment, and further integration with Western economic and political institutions remains a fundamental tenet of major political parties on both sides of the political spectrum. The current government has voiced strong support for further economic reforms, but its relative inexperience and position as a minority government have limited its ability to tackle underlying structural issues affecting the economy.
Some European companies have sought to use the Czech Republic's interest in EU membership to gain advantage in commercial competition. Although Czech interest in EU accession is clear, the Czechs also desire a strong U.S. presence in the country.
American and other foreign business people often cite a convoluted -- or in some cases corrupt -- system at both national and local levels as impeding market access. Potential investors often must spend considerable time and effort to finalize a deal, or to enforce the terms of a contract, and the Embassy is sometimes asked to intercede on an American investor's or supplier's behalf. Government officials have proved, in most cases, to be accessible and receptive in such instances.
The risk of political violence in the Czech Republic is extremely low. The Czech lands have never had a history of political violence or terrorism. Two recent historic political changes -- the "Velvet Revolution," which ended the Communist era in 1989, and the division of Czechoslovakia into the Czech Republic and Slovakia in 1993 - occurred without loss of life or significant violence.
C. Synopsis of Political System, Schedule for Elections and Orientation of Major Political Parties
The Czech Republic is a parliamentary democracy. President Vaclav Havel, the head of state, is an internationally recognized advocate of human rights and social justice. The Prime Minister is Milos Zeman, chairman of the left-of-center Social Democratic Party (CSSD). He heads a minority government. The main opposition party is the right-of-center Civic Democratic Party (ODS), headed by former Prime Minister Vaclav Klaus. Other opposition parties are the right-of-center Freedom Union (which split from ODS in 1998), the centrist Christian Democratic Union (KDU-CSL) and the leftist Communist Party. The next scheduled national elections are in 2002, but many analysts predict the fragility of the minority government may lead to a new coalition government or early elections.
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Note* International Copyright, United States Government, 1998 (or other year of first publication). All rights under foreign copyright laws are reserved. All portions of this publication are protected against any type or form of reproduction, communications to the public and the preparation of adaptations, arrangement and alterations outside the United States. U. S. copyright is not asserted under the U.S. Copyright Law, Title17, United States Code.
