Czech Republic: Czech elections leave country without clear political leadership, difficult coalition negotiations ahead
October 25, 2013
On 25 and 26 October, the Czech Republic celebrated snap parliamentary elections after the caretaker government had failed to win a confidence vote in August. As expected, the Czech Social Democratic Party (CSSD) came in first, receiving 20.5% of the votes. However, disaffection with mainstream parties caused support for the Social Democrats to fade away just weeks before the election. Surprisingly, billionaire Andrej Babis, who created the ANO 2011 Party, came in strong at second place with 18.7% of the votes. The Communist Party of Bohemia and Moravia (KSCM) came in third (14.9% of the votes). The center-right Civic Democratic Party (ODS)-once led by former Prime Minister Petr Necas-was punished by disappointed voters and obtained only 7.7% of the votes. The rightist TOP 09 Party-a former ODS coalition partner-received 11.9% of the votes. The two other parties that crossed the threshold of 5.0% of votes required to enter Parliament were the newly-formed Usvit (Dawn of Direct Democracy) and the Christian Democrats (KDU-CSL).
With seven parties passing the 5%-threshold to enter parliament, it will be difficult for the CSSD to form a new government as there is no straightforward coalition to secure a majority in the 200-seat Parliament. The CSSD, with just 50 seats, will have to negotiate with the second- and third-largest parties in Parliament for support. Most analysts expect the Communist Party to provide support. However, as the Communists came in third and won only 33 seats, it is impossible for the two parties to secure a majority. Meanwhile, Andrej Babis' extraordinarily strong result makes him a crucial player-the ANO 2011 Party obtained 47 seats. Nonetheless, it is still unclear whether ANO 2011 will join in the formation of a coalition or stay in the opposition. That said, coalition negotiations in the fragmented legislature are likely to drag on for some time. This has raised expectations of another protracted period of political uncertainty, which could have a negative impact on the already anemic economy.
Author: Ricardo Aceves, Senior Economist