News Saturday, NOVEMBER 25th, 2000

By: Vladimir Tax

New National Bank governor appointed

Czech President Vaclav Havel has appointed Zdenek Tuma as the new governor of the Czech National Bank. Mr Tuma succeeds Josef Tosovsky, who resigned at the beginning of November after 11 years in office. President Havel choose Mr Tuma despite strong opposition from the two main political parties, the ruling Social Democrats and the main opposition Civic Democrats. Mr Havel argued that he could not postpone the appointment any longer as it could destabilise the Czech National Bank. Havel also named new members of the board of the central bank. He made it clear that the independence and expertise of the central bank leaders was, in his opinion, more valuable than their acceptability to political parties. Mr Havel appointed Mr Tuma a month before a new law on the Czech National Bank comes into effect, under which the new governor will be chosen by the government.

In his reaction to Tuma's appointment, the opposition leader and speaker of the lower house, Vaclav Klaus, accused President Havel of using the Czech National Bank as a vehicle to achieve his political goals. Mr Klaus said Tuma's appointment was a threat to the bank's independence.

Prime Minister Milos Zeman said that by his choice, President Havel assumed responsibility for possible deterioration of Czech economic development. Zeman was referring to Tuma's recent warning that the bank would tighten its monetary policy if the current economic growth leads to stronger inflationary pressures.

Four-Party Coalition calls for vote of no-confidence in cabinet

The Four-Party Coalition has called for a vote of confidence in the cabinet after the ruling Social Democratic Party's recent failure in the Senate and regional elections. The coalition of four right-of-centre parties did unexpectedly well in both elections and gained 39 out of 81 seats in the upper house. The Four-Party Coalition argues that it would be logical for the government to ask for a vote of confidence because the elections clearly showed the stance of Czech citizens towards the Social Democrat government. At the same time, the coalition admitted that it would be impossible to initiate the government's removal because it was installed due to a power-sharing pact with the strongest opposition party, the Civic Democrats. Any vote of confidence would take place in the lower house, where the Social Democrats and the Civic Democrats still enjoy a majority.

Battle for liberal telecommunications market continues

Czech alternative telecommunication operators have been protesting against the conditions for interconnection of networks announced by the monopoly Czech Telecom. The so-called Reference Interconnection Offer governs the conditions for the interconnection of the public telecommunication networks of Czech Telecom and the competing operators which will be allowed to enter the market as of January 1st. The newcomers are complaining about the prices for interconnection which are higher than the end-user price of calls within Telecom's network. That means that the other operators will be unable to offer competitive prices. Commentators say Czech Telecom has thus made another move to retain a dominant position on the market, benefiting from its monopoly position.

Rapist sent to prison for a quarter century

Prague district court has sentenced a Ukrainian national, Olexander Kravz, to 25 years in prison. Kravz was found guilty of murder and multiple rape. In addition to the prison sentence, Kravz will have to undergo psychiatric therapy and will be expelled from the country after serving the sentence.

Weather forecast

And finally, a brief look at the weather - we are expecting a cloudy day with occasional showers, the highest daytime temperatures should range from 5 to 10 degrees Celsius.