Czech Republic Politics and Economy

Government and politics

Founding principles

According to, the Czech Republic is a parliamentary democracy, whose Constitution as well as the Charter of Fundamental Freedoms and Rights (an integral part of the Magna Carta of the Czech Republic) were ratified on December 16, 1992, and entered into force on January 1, 1993. Civil law is based on the Austro-Hungarian (former monarchy) legal system while the legal system is currently in the final stage of harmonization with European Union law following the 2009 entry into force of the Lisbon Treaty.

Separation of powers

The head of state is elected in indirect elections by the two houses of Parliament in joint session, the presidential term is 5 years. On the other hand, the Government is formed every four years based on the results obtained in the parliamentary elections, forming with the members of the winning party in the elections or by coalition between the main winning parties. At the head of the government cabinet is the Prime Minister (President of the Government), proposed by the winning political forces in the elections and ratified by the President of the Republic.

Legislative power rests with the Parliament of the Czech Republic, a bicameral body, elected every four years, based on a proportional system of election. It is divided into two chambers, the lower house, which is the Chamber of Deputies, which has 200 seats, and the Senate, which has 81 senators, elected for a period of 6 years (majority system). One third of the Senate is renewed in elections every two years.

Foreign policy

Its membership of the European Union is the central axis of the foreign policy of the Czech Republic. The born took over the Presidency of the European Union during the first half of 2009. The Czech government had diplomatic confrontations with Burma, Belarus, Moldova and Cuba.


The economy of the Czech Republic is one of the most developed and most stable among the nations of Central and Eastern Europe. The Czech Republic launched economic reforms vigorously in 1991, such as price liberalization, freedom of import and export, privatization of companies in different sectors, and economic stabilization. After a slump as a consequence of the trade deficit at the end of the 90s of the 20th century, its growth increased significantly in the 2001-2002 biennium. That allowed him to enter the European Union in good condition. Most exports now go to the EU, reaching 71% of the total in 2004. The agricultural sector has progressively decreased the workforce employed, standing in 2004 at 3% of the total and contributing less than 12% of GDP. The most important crops are cereals such as wheat and barley, followed far behind by beets, potatoes and flax.

The privatization of the state sector and transformation into the liberal capitalist system has resulted in the liquidation of most of the manufacturing companies. Privatization took place in the 90s of the 20th century led by Václav Klaus and Václav Havel. The world-famous products of the brand, which existed before privatization: ČKD, Poldi Kladno, Chirana, Tesla, OP Prostejov, Orion – the product is labeled “Made in Czechoslovakia”. Basic living conditions for worse citizens – French company Veolia 77x more expensive drinking water

The economy of the Czech Republic maintains a highly diversified industrial structure. The industry employs almost a third of the workforce and currently represents about 40% of PPP. Despite the problems of lack of renovation and new technologies of some large companies, foreign investment from Germany, Japan and the United States and other developed countries is allowing the installation of new industries, especially automobiles and the improvement of heavy industry .

Mining focuses on energy sources such as coal and lignite, in addition to nuclear energy. This causes high levels of environmental pollution and non-compliance with the Kyoto protocol. Services have undergone great growth, with 57% of the population employed in this sector in 2003, contributing 55% to GDP. The most dynamic of the sectors is tourism and the one that has created the greatest problems due to lack of competitiveness and small size is banking, in general, financial services.

In 2005, the economic growth of the Czech Republic is three times faster than that of most EU countries and the first foreign trade data show that in the first half of 2005 there was a trade surplus of 40 million euros.

Czech Republic Politics

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