 I. Introduction
Czech Republic, landlocked republic in central Europe, comprising
the historic regions of Bohemia and Moravia, and part of Silesia. The republic borders
Poland to the north, Germany to the northwest and west, Austria to the south, and Slovakia
to the east. Prague is its capital and largest city.
The Czech-inhabited lands of Bohemia and Moravia were part of the Austro-Hungarian Empire
from the early 17th century until 1918, when they were united in a common state with
Slovakia and part of Silesia. The new state, a democratic republic known as
Czechoslovakia, was broken up during World War II, but was reestablished at the end of the
war in 1945. From 1948 to 1989 the republic was ruled by a Communist regime. In November
1989 the Communist government was ousted and Czechoslovakia again became a democratic
state. During the early 1990s, political and economic conflicts developed between the
Czechs and Slovaks, and leaders of both groups decided to dissolve the republic. In
January 1993 Czechoslovakia was replaced by two independent states, the Czech Republic and
Slovakia.
II. Land and Resources
The total area of the Czech Republic is 78,864 sq km (30,450
sq mi). The maximum distance from east to west is about 490 km (about 305 mi), and the
maximum distance from north to south is about 280 km (about 175 mi). Mountain ranges bound
much of the country.
III. Population
The Czech people are descended from Slavic tribes who arrived
in Bohemia and Moravia in the 5th century AD. The Czechs are the country's dominant ethnic
group, representing about 94 percent of the population; Slovaks account for about 3
percent; and Poles, Germans, Roma (Gypsies), and Hungarians comprise most of the
remainder.
At the time of the 1991 census, the total population of the Czech Republic was 10,302,215;
the 2000 estimate was 10,283,762. The population density, based on the 2000 estimate, was
130 persons per sq km (338 per sq mi). The country is divided informally into seven
regions, corresponding to administrative divisions that were abolished after the collapse
of Communism. These regions, with their 1991 census populations, are Central Bohemia
(1,112,882, excluding Prague), Southern Bohemia (697,503), Western Bohemia (860,292),
Northern Bohemia (1,174,034), Eastern Bohemia (1,233,187), Southern Moravia (2,049,386)
and Northern Moravia (1,960,757). The Czech Republic has been one of Europe's most highly
industrialized regions since the latter half of the 19th century. Some 66 percent of the
population lives in urban areas.
IV. Economy
The Czech lands have been traditionally among the most
economically developed regions of Europe. When the Communists came to power in
Czechoslovakia in 1948, they created a highly centralized economic system. Nearly all
aspects of economic planning and management came under the control of the central
government. Virtually all of the country's economic assets were placed in state hands;
economic managers and decision-makers were cut off from their counterparts in the West;
and foreign trade was conducted almost exclusively with other Communist countries.
Although the economy remained strong by Eastern European standards, with one of the
highest standards of living in the Communist world, the policies adopted by the Communist
government led to long-term economic decline in Czechoslovakia. After the collapse of
Communism in 1989, the new leaders of Czechoslovakia had to deal with this legacy.
In the early 1990s the post-Communist government moved quickly to convert the economy to a
system based on free enterprise. A number of reform measures were adopted, including a
voucher privatization plan, which gave citizens, for a low administrative fee, coupons
that could later be traded for stock in companies. The voucher plan successfully
transferred large parts of the economy to private ownership. By December 1994 more than 80
percent of firms in the Czech Republic were privatized or had decided on a privatization
strategy. Business boomed in Prague and other cities in the mid-1990s as entrepreneurs
established new companies. The government has also succeeded in reestablishing trade with
the West and obtaining substantial levels of foreign investment.
The average standard of living in the Czech Republic dropped somewhat in the early 1990s
as market reforms were introduced, but in recent years the economy has begun to recover.
Inflation was about 10 percent in late 1994, less than half of what it was in 1991. Gross
domestic product (GDP) increased by approximately 2 percent in 1994. Industrial
production, which declined sharply in 1990 and 1991, also grew in 1994. The country's
foreign debt has remained modest. By 1998 the GDP had reached $56.4 billion.
The Czech Republic is a member of the International Monetary Fund (IMF), the International
Bank for Reconstruction and Development (World Bank), the European Bank for Reconstruction
and Development (EBRD), the Central European Free Trade Association, and the Organization
for Economic Cooperation and Development (OECD). The country became an associate member of
the European Union (EU) in October 1993 and in December 1997 was invited to begin the
process of becoming a full member. One of six nations picked for the EU's first round of
expansion, the Czech Republic is expected to join the organization within five to ten
years.
V. Government
Václav Havel was elected president of the new Czech Republic
in January 1993. Václav Klaus, who had become the Czech prime minister in June 1992,
continued to head the government. Under Klaus's leadership, the government introduced
another wave of voucher privatization in the fall of 1993. By the end of 1994, an
estimated 70 percent of industry had been privatized. Though the economy had declined
somewhat following the collapse of Communism, it began to recover in the mid-1990s. The
inflation level dropped, unemployment remained low, and the country attracted sizable
amounts of foreign investment.
Following its creation in 1993, the Czech Republic experienced remarkable political
stability. Support for Klaus and his government remained high, and there was little
popular support for extremist groups on either end of the political spectrum.
After a great deal of debate, the government voted in April 1994 to return property to the
families of Czech Jews who were dispossessed by the Nazi regime during World War II. In
recent years, debates have also arisen concerning treatment of the country's large Roma
minority. A significant proportion of the Roma population has been excluded from Czech
citizenship due to stiff requirements. Some citizens and human rights advocates have
expressed concern that the country's citizenship law effectively discriminates against
this already disadvantaged group.
In foreign affairs, the Czech government maintained good relations with neighboring
central European countries, and continued to emphasize the importance of close ties with
Western Europe. Czech leaders continued to press for full integration into international
organizations, including the EU and NATO.
In June 1996 the Czech Republic held its first parliamentary elections since the country
split from Slovakia in 1993. Prime Minister Klaus's center-right coalition lost its
majority in the Chamber of Deputies (lower house of parliament) by a narrow margin, and
the center-left Czech Social Democratic Party, the political opponent of Klaus's Civic
Democratic Party, greatly increased its representation. The election results surprised
many observers, as the Czech Republic had been consistently viewed as the most politically
stable of the former Communist countries of Central and Eastern Europe; the results were
widely believed to reflect Czech voters' dissatisfaction with some of the policies of
Klaus's government, including its reform of the social welfare system. Following the
elections, Klaus signed a coalition agreement to form a minority government and was
reappointed prime minister.
In November elections were held for the Senate, or upper house of parliament, and
center-right parties of the ruling coalition won the majority of seats. The elections were
the first ever for the 81-member Senate, which came into existence in September 1995 by a
vote in the Chamber of Deputies. Although the constitution that took effect in 1993 had
provided for the creation of the Senate, disagreements within the Chamber of Deputies had
hitherto prevented its establishment.
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