Czech Leader, Scarred By Scandal, Set to Be Narrowly Re-Elected
(Bloomberg) -- Billionaire Prime Minister Andrej Babis is poised to win the Czech Republic’s elections, though he will fall short of a majority and a series of scandals have hurt his chances of finding partners.
Outrage over one of the world’s highest Covid-19 death tolls per capita, accusations of fraud concerning EU funds and revelations from the Pandora Papers about offshore deals, have turned Babis into a political pariah and mainstream parties have rejected the idea of joining him in a coalition government.
That opens the prospect of Babis pairing up with far-right nationalists or unreformed Communists to stay in power if he wins the two-day vote, which ends on Saturday, as expected.
The issue is that he remains popular among older and less-educated Czechs after he hiked pensions and public wages at the head of a minority administration in his first term. He has also taken a page from his anti-immigration allies in Poland and Hungary by warning voters that the country of 10.7 million will be overrun by Muslim immigrants if his rivals take power.
An increasingly isolated figure, the concern for the European Union is that he may look to the extremes of the political spectrum and that would widen a rift between Brussels and its eastern members over democratic values.
“It’s the last chance to vote for Babis, the last chance to protect our national interests, our living standards, our culture and our independence,” Babis told a campaign rally in September.
Since taking power in 2017, Babis has faced repeated scrutiny by law enforcement and the European Union into Agrofert AS, his media, agriculture and chemicals empire comprising more than 250 subsidiaries and employing about 34,000 people.
The European Commission has found him in conflict of interest because as premier he holds a voice in the distribution of EU funds while benefiting from those Agrofert receives, and it warned the country may not get the entire 7 billion euros ($8 billion) it’s due to receive in pandemic aid unless it fixes oversight rules.
Czech prosecutors are also reviewing whether to charge him in a case where one of his companies is accused of misusing 50 million koruna ($2.3 million) in EU financing. And police are investigating reports from last week’s Pandora Papers leak that he moved $22 million through offshore companies to buy a French Riviera property in 2009, two years before he entered politics.
Babis has dismissed the allegations as political attacks aimed at forcing him out of politics.
His long-time ally President Milos Zeman has essentially pledged to appoint Babis as prime minister-designate after the election and can give him unlimited time to stay on as caretaker and drag out coalition negotiations.
Babis has done just that since 2017 under tacit support from the far-left while also depending on the far-right Freedom and Direct Democracy, known as SPD, to push through legislation.
It’s the SPD that presents the greatest risk. Endorsed by French nationalist Marine Le Pen and Dutch far-right populist Geert Wilders, the party has demanded a Brexit-style referendum on leaving the bloc.
Babis has rejected holding a vote on membership, but any kind of tie-up with SPD could lead to deeper tensions with Brussels.
Meanwhile Babis’s main opponents -- the economically conservative SPOLU and a center-left coalition led by the Pirate Party calling for stronger ties with the EU -- may even win a combined majority. But Zeman’s stance gives them little prospect to unseat him and only the opportunity to paralyze his agenda.
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