The Czech Republic has been an economic success story since joining the EU in 2004. Yet as Lenka Buštíková explains, the country’s twenty years of membership have also been marked by profound political instability and the rise of illiberal leaders.
The Czech Republic is a poster child for the EU enlargement process. A country of over ten million, it now has a GDP per capita that exceeds Spain and is closing in on Italy. Prague ranks among the top twenty global cities for its quality of life, beauty and safety. The Czech middle classes have also become accustomed to going on ski trips in Austria and spending summers at the Adriatic and Mediterranean seas.
Yet, at the same time, the country recently suffered one of the highest inflation rates in Europe, its accumulation of public debt is accelerating, and, in some regions, every third family is seriously indebted. Rents are high and young people are being priced out of the housing market. Twenty years after joining the EU in 2004, it is worth taking stock of what these contradictions mean for the country’s future.
An economic success story
EU membership has benefited the Czech Republic economically and provided it with much needed security. In twenty years, GDP per capita has increased from 81 per cent of the EU average to 91 percent. Czechia is a net beneficiary of European funds with a significant surplus. Trees have been planted, historical buildings have been restored and swimming pools, playgrounds and bike paths have all been built with generous support from the EU.
Enlargement fulfilled the country’s aspiration to “return to Europe”. Czechs perceive themselves as Central, rather than Eastern Europeans, and point to the fact that Prague is west of Vienna. The Czech economy is export-oriented and heavily depends on foreign demand. It closely mirrors Germany and some even joke that its economic hyper-dependence makes Czechia the seventeenth Länder.
Czechia has effectively opened up to the West. In contrast to other EU accession states, brain drain and population shrinkage have been less of a challenge. Over 411,000 Czechs have taken part in the Erasmus Programme since 1998 and Czechia is an increasingly attractive destination for Erasmus students. It ranks as the 11th most attractive of the 34 participating countries. Enrolments in English language programmes have soared and 18 percent of enrolled students at Czech universities are foreigners.
Political instability
Despite all these accomplishments, Czech politics entered a state of free fall after the 2004 enlargement. Once prematurely hailed as a consolidated democracy, the Czech party system imploded from 2010 onwards, with a governance crisis undermining the legitimacy of major parties and facilitating the rise of illiberal leaders.
A series of corruption scandals and weak leadership led to the two dominant parties on the left and right losing support. This opened the door to a new populist party, ANO 2011, led by businessman Andrej Babiš, which rose to prominence in the 2013 and 2017 Czech parliamentary elections. Babiš’s leadership further accelerated the decay of programmatic politics in the country.
The party system became characterised by increasingly personalised forms of leadership, over-reliance on social media and frivolous spending pledges targeted at the pockets of voters to achieve immediate electoral gains. At the presidential level, Václav Klaus, a well-known Eurosceptic, was elected President in 2003 and 2008. The presidency of his successor, Miloš Zeman (2013-2023), was derailed by alcoholism, vulgarity and sycophantic overtures towards China and Russia.
Czechia is now a polarised country burdened with unhealthy public finances. Its innovative potential is being stifled by long delays in implementing pension reforms, labour market restructuring and improving the education system. As in many wealthy democracies, the political system is tilted towards older generations. Yet, rising housing and living costs as well as environmental degradation are disproportionately affecting young people.
Navigating crises
During the 2008 financial crisis, the Czech Republic went into recession. The Czech banking sector was largely unaffected due to large deposits, however the crisis undermined appetite for adopting the euro.
Support for joining the euro was highest in 2003, when 58% of Czechs were in favour. After the financial crisis, this dropped to only around 20% of people favouring joining the euro. This opposition continues today: according to a 2024 poll, two thirds of Czechs believe that switching to the euro would not benefit them.
In terms of support for the European Union, 2023 polling by CVVM shows that two thirds of Czechs believe that Czechia should be an EU member. However, only around 40% of Czech citizens are satisfied with the country’s present membership. Polling also reveals that security and cultural exchange are viewed as the two most valuable aspects of EU membership.
Ahead of the EU accession referendum in 2003, newly elected President Václav Klaus refused to endorse membership and, in time, moulded public opinion against Brussels. The 2015 migration crisis and especially the threat of imposed refugee quotas, spearheaded by Angela Merkel, played into anti-German sentiments and further alienated the public from the European Union.
The Syrian crisis introduced Islamophobia to Czechia, despite almost no refugees from the Middle East settling in the country. Sensational media coverage amplified by political entrepreneurs whipped up fears of non-European Muslims into an imaginary immigration threat.
Czechia has nevertheless become a magnet for other migrants, especially after 2004. Labour migration is highly encouraged by all political parties and the number of foreigners living in the country has increased significantly since 1990. On top of regular migration, Czechia has accepted over 650,000 refugees from Ukraine since 2022, mostly women and children, and integrated them relatively well. It now has one of the highest number of refugees per capita in Europe.
Influence in Brussels
Czechia’s ability to make its voice heard in Brussels and shape the EU’s institutions has proven to be limited. However, it is now emerging as an important actor on foreign policy in relation to the war in Ukraine.
Prime Minister Petr Fiala famously joined his Polish and Slovenian counterparts on a train ride in March 2022 to visit Ukrainian President Volodymyr Zelensky, becoming the first leaders to visit Kyiv after Russia’s full-scale invasion. In 2021, Czechia expelled over 100 Russian embassy staff and their family members from the country over a spying row and it has also issued a visa ban for Russian and Belarusian citizens. It advocates for a tough approach towards Russia together with Poland and the Baltic countries and currently spearheads major ammunition purchases for Ukraine.
The Czech Republic is also unique in its unequivocal support for Israel. This unwavering, and at times uncritical, pro-Israeli position has long historical roots and has been maintained under different political leaders. This might lead to conflicts with European partners if some members advocate for divestment or punitive approaches towards Israel.
Misconceptions
There remain three common misconceptions about Czechia. First, Czechia is no longer a homogenous country. It is ethnically diverse, with most migrants coming from Ukraine, Slovakia and Vietnam.
Second, Czechs are not Eurosceptic, but they have a pragmatic approach towards adopting the euro and distaste for red tape perceived to originate in Brussels. Czechs therefore strengthen Eurosceptic voices in the European Parliament.
Third, while Czechs are known to love beer, there is also a serious drug problem in the country. It ranks as the crystal meth capital of Europe both in terms of the number of users and in terms of the scale of production.
When it comes to the Czech Republic’s influence over the future direction of the EU, it is likely that instead of deepening the integration process, the country will opt for widening. Czechia’s commitment to Ukrainian sovereignty will also have an impact on future enlargement negotiations.
Due to its strong support for Ukrainian membership, close ties with Israel and commitment to good trans-Atlantic relations, it will seek allies in the European Union that can be instrumental in protecting the country’s sovereignty. Ultimately, Czechia views the European Union as a solution to existential threats and as a firewall against Russia and foreign threats.
This article is part of a series organised by Eli Gateva on Rethinking Europe’s East-West Divide – 20 Years since the Big Bang Enlargement
Note: This article gives the views of the author, not the position of EUROPP – European Politics and Policy or the London School of Economics. Featured image credit: European Union
