EU-Politik

Final assessment of the Czech EU Presidency

The Czech EU Presidency was supposed to test the reliability and credibility of the Czech Republic in the eyes of the other member states. The current geopolitical situation has turned the Czech Presidency into a serious acid test. The Czech Prime Minister Petr Fiala and his government seem to have passed this test. From the very beginning, the government was highly appreciated by the other states for its attitude towards the Russian invasion. This was mainly due to the fact that the Czech government acted with a great resolution from the very beginning of the invasion, which was underlined by the trip of the Czech PM to Kiev in March. The Czech EU Presidency was thus marked by clear symbols of solidarity and pragmatic compromises that impressed (not only) the Brussels scene.

Czechs as Trustworthy Partners in Negotiations

During its EU Presidency, the Czech Republic had to focus mainly on the crisis agenda, with an emphasis on energy policy issues and the negotiation of very complex packages such as the climate package and support for Ukraine. The Czechs proved to be first-rate negotiators especially in the energy sector, focusing on pragmatic compromises.

In particular, the agreements on the energy price cap, joint gas purchasing and solidarity in case of a gas supply cut can be described as a breakthrough. This will significantly improve the negotiating position of the EU countries on the global markets and ensure a smoother filling process of gas storage facilities for the next winter. A significant progress was also noted in the negotiations on the "Fit for 55". On top of that, during the Presidency, numerous three-way meetings of the EU legislative institutions resulted in positive outcomes.

However, the negotiations on financial support for Ukraine were not nearly as successful: in October, European countries pledged a loan of 18 billion euros to prevent the country from a breakdown in 2023. However, at the last council meeting about economy and finances this year, which took place on 6 December, finance ministers were unable to reach any agreement. In another words, a loan intended for funding doctors' salaries and pensions was blocked by a single state - Hungary.

Have no illusions, this is no coincidence. Hungary is fighting for a lot of money with its extortionate methods. On the one hand, Orbán's battle concerns EUR 5.8 billion from the previously blocked COVID-19 recovery plan for Hungary. On the other hand, since the country is to be deprived of EUR 7.5 billion from other EU funds as a penalty for violating the rule of law, Orbán is trying to mitigate this fine as well. The unanimity required to approve the loan for Ukraine thus became a hostage.

In recent weeks, Hungary tried to partially respond to Brussels' criticism, for example by strengthening the Hungarian system of corruption investigations. The finance ministers agreed to give Budapest some time to make amends. This would eventually allow for a certain decrease in the Hungarian sanctions (in this sense, about 1.2 billion euros have already been "unfrozen") and it also could result in the Hungarian government giving up its blocking of loans to Ukraine. The next council meeting about economy and finances will take place on 17 January 2023, this difficult negotiating task will hence become a responsibility of the Swedish EU Presidency.

United EU and United Europe

At the beginning of October, all eyes were directed towards the first EPC Summit (European Political Community), which was attended by presidents and prime ministers from 44 European countries. Although the EPC Summit was not part of the Council Presidency, the Czech Republic took advantage of the presence of all EU leaders in Prague and combined the summit with an informal European Council meeting the following day.

The EPC summit was crucial, because some heads of state from countries that normally do not have any diplomatic meetings, were sitting at the same table: the Serbian President Aleksandar Vučić with the Kosovo President Vjosa Osmani, or the Turkish President Recep Tayyip Erdogan with the Armenian Prime Minister Nikol Pashinyan. It was also the first summit between the UK and EU countries since Brexit. No wonder that nearly a thousand journalists gathered in Prague plus the whole summit was broadcasted across Europe and a significant part of the world.

The main goal of the summit was to demonstrate a sense of belonging and build trust. French President Emmanuel Macron summed up the summit as follows: "We need to send a message of united Europe, where we are able to exchange views on the current situation and discuss a common strategy. Although there are EU members, candidate countries and countries that have left the EU, we all share the same space, often the same history as well. We need to talk about a common future." In the same breath he added that he hoped the countries would meet every six months. Moldova is expected to be the next host.

Of course, Russia's absence did not escape attention. "It was a signal that Europe stands together and that we have solidarity with each other - as democracies that honour freedom, human and civil rights; this all in contrast to Putin's behaviour in Russia and Russia's behaviour in Ukraine," said Thomas Hacker, a Member of the German Bundestag, at a joint event of the Prague office and the Munich regional office of the Friedrich Naumann Foundation for Freedom, which focused on the Czech EU Presidency.

Hidden Success

Everyone can confirm with a clear conscience that the Czech Republic has mastered its second Council Presidency very successfully and thus experienced a comeback to the EU. It is only logical to expect the country to proudly communicate this success to the Czech citizens and raise their excitement about the EU idea. Unfortunately, this has not happened. According to the experts, the limited financial resources and the poorly managed activities of the Minister for European Affairs, Mikulas Bek, have played a role in this. Since June, not much has been heard from him.

Only two issues enjoyed a great deal of attention in the Czech society: the EPC summit and Croatia's accession to the Schengen area. Even though the EPC summit was not an official part of the Presidency, its media coverage was omnipresent and inevitable. Regarding the accession of Croatia into the Schengen area, it was presented mainly by the government in order to soften the hearts of voters during the financial crisis. The promise of a faster and trouble-free travel to a favourite holiday destination that is visited by 10 % of Czechs every year, most probably helped the government in this endeavour.

Relief? Maybe Another Time

After such a successful performance, the government would deserve at least a moment to breathe. However, no break is in sight, because the country is facing serious financial problems. The raise in energy prices is the highest in Europe, the inflation remains at 16-18% for months, and the government has approved a preliminary budget for 2023 with a deficit of CZK 295 billion. This represents the second-highest deficit in the history of an independent state and experts warn that the country's debt burden is not sustainable in the long run. Therefore, the current government faces some difficult and unpopular decisions.

Ester Povýšilová is project manager in the Friedrich-Naumann-Foundation for Freedom in the office for Central Europe and Baltic States in Prague.