Economy

Czech cabinet proposes enshrining koruna in constitution

The Czech cabinet approved a proposal to enshrine the koruna in the constitution, signaling a shift away from euro adoption. The Babiš administration holds 108 seats but requires 120 parliamentary votes to implement the change amidst ongoing protests and political friction.

Czech cabinet proposes enshrining koruna in constitution

Parliamentary hurdles for the koruna

The Czech cabinet approved a proposal on October 26 to enshrine the koruna in the constitution and shifts away from the euro adoption plans that followed the country’s 2004 entry into the EU and a 2003 national referendum. Although Prague committed to the single currency upon EU entry, successive cabinets have done little to adopt the euro. The populist government, led by Prime Minister Andrej Babis, includes his Ano party, the far right Freedom and Direct Democracy party led by Tomio Okamura, and the Motorists. This administration is the most rightwing in the country’s history and holds a majority of 108 seats after Ano won last October’s general election with nearly 35% of the vote, one of the strongest performances in Czech politics on record. The cabinet members signaled they hope to get MPs from the opposition neoliberal ODS party to join them to reach the necessary majority. The coalition, which consists of the Ano party, the far right Freedom and Direct Democracy party led by Tomio Okamura, and the Motorists, holds 108 seats but lacks the 120 parliamentary votes needed to implement this change, although the document describes the "tabled constitutional draft law" as a step to fulfilling the government programme.

Entity Value Detail
Ano 35% Election vote share
Coalition 108 Parliamentary seats
Threshold 120 Required parliamentary votes

Protests and political friction

The Babis cabinet faces a country-wide protest movement that accuses the government of trying to tear the country out of the EU and uses measures reminiscent of the rule of former Hungarian prime minister Viktor Orban. These regular protests target the dismantling of environmental, human rights, and drug policies, as well as the push to curtail financing for public media and NGOs. Minister of Foreign Affairs and Motorists leader Petr Macinka said he hopes opposition parties remain consistent in what they have been saying for many years. The current ODS leader, Martin Kupka, attempts to push his party into more EU mainstream politics, despite the ODS having delayed Euro adoption and produced radical anti-EU politicians like Vaclav Klaus, who now openly backs the SPD. While economists suggest the euro would benefit the export-oriented economy, the cabinet uses nationalist and sovereignist rhetoric targeting Brussels and Germany. In May, Okamura led a parliamentary resolution against the Sudetengerman summit, which commemorated the German minority expelled from the former Czechoslovakia in the aftermath of World War II.