Czech Elections PM Andrej Babis likely to lose power

Czech politician and billionaire Andrej Babis has been in power for less than a year, but he is likely to lose it. Polls suggest that his party’s coalition will lose its majority in Parliament after the October 20 election.

The Czech Republic is due to hold general elections on Oct. 20 with opinion polls suggesting that Mr. Babis’s ANO movement could win as many as 30 seats, down from 78 when they won last June’s parliamentary election and formed a minority government with three other parties

Mr.Babis has served as prime minister of the Czech Republic since 2017 when he became the first person outside of Communist Party rule to lead this country in almost half a century. He served as finance minister and deputy prime minister until May this year when he resigned to form a government.

His resignation came amid allegations that he had illegally received 50 million crowns (US$2.8 million) from the Russian Agricultural Bank, which has been under Western sanctions since 2014 over Russia’s annexation of Crimea from Ukraine. The money was allegedly a gift from Mr. Babis’s father in 2013, when his company, Agrofert, won a tender to buy the bank’s assets in the Czech Republic.

Mr.Babis has called the allegations nonsense, saying he received financial support from a Russian billionaire during a period in which he was financially struggling.

Mr.Babis is accused of illegally receiving 50 million crowns (US$2.8 million) from the Russian Agricultural Bank, which has been under Western sanctions since 2014 over Russia’s annexation of Crimea from Ukraine

The Czech economy has remained one of the strongest in Europe with its GDP growing by an estimated 4.3 percent last year, despite the country’s decision to adopt the euro at a later date than its EU counterparts or Britain, which is scheduled to leave the 28-member bloc in March 2019

Last October, an analyst with Moody’s Investors Service said that the government has broadly met its fiscal consolidation targets although the fiscal deficit is higher than planned due to weak tax collection. Mr.Babis’s government reduced the budget gap last year to 2 percent of GDP, which was below the 3 percent target set by the European Union

Moody’s noted that policy-making often faces external constraints because ANO lacks a majority in Parliament and must rely on other parties to pass legislation.

Mr.Babis has been a media mogul before entering politics and currently controls a quarter of the Czech Republic’s newspapers, magazines, and TV stations, as well as one-third of regional daily newspapers

In February 2018, the Czech prime minister narrowly escaped being removed from office after his chief political rival filed a no-confidence motion in Parliament against him after the country’s police chief accused Mr.Babis of ordering an illegal wiretap of one of his senior aides

Mr.Babis has also been struggling with various allegations related to EU subsidies, including the European Commission’s decision in November 2016 to trigger an infringement procedure on suspicion that he conflicted with interest while financing a conference hall close to his home with European Union funds. However, the case has remained largely dormant over the past year.