© Agencja Gazeta/Slawomir Kaminski via REUTERS

Mr. Schwarzenberg, how do you see the situation of the countries in Central and Eastern Europe today? Let’s start with the Czech Republic. I’m not very happy with the situation in my country. The economic situation is very good, the country develops very well economically. People are much richer than a few years ago. But the political situation is deplorable.

Is it comparable to the situation in Hungary and Poland? In Hungary, an authoritarian government has successfully eliminated every meaningful opposition, including all opposition media. And, one must admit, the top echelons of the regime have become much richer over the last years. The situation in Poland is different: There’s an active opposition and an active media. Even the worst critics of Jaroslaw Kaczynski [the leader of the Law and Justice party, which has been governing Poland since 2015] don’t suspect him of taking any money; in fact, he lives very modestly in Warsaw with two cats. So, there is a huge difference between Hungary and Poland. Of course, the Germans are not very happy with Mr. Kaczynski, and that’s understandable! He is a traditional Polish nationalist, but he is a decent man.

For these and other states in the region, what have been, and continue to be, the biggest challenges—authoritarianism, weak institutions, and corruption, external actors like Russia or China? There has been corruption in all our countries; it’s been worst in Romania. In fact, the further southeastwards to get, the worse the problem becomes. But in Western Europe, there has been corruption, too. In Central and Eastern Europe, it is slowly getting better.

How persistent are the aftereffects of communist rule? The consequences of the dictatorships are grave, of course–and you have to remember, often there were the Nazis first, then came the communists; taken together that’s up to 60 years of totalitarian rule. In Austria, the Nazis were in power for seven years only, but the country still grappled with the consequences in the 1970s. So of course remnants of that deplorable totalitarian mentality take a long time to disappear.

Do you think EU enlargement was a success? How would you assess the role Germany and the Western Europeans have played? The Western European countries, including Germany, were first of all interested in their own opportunities, and they had enormous economic success. Just look at the export numbers of Germany or Austria! For Western European countries, enlargement was an enormously successful business. The political impact was different, it was somewhat less of a success.

Are the Eastern Europeans being given their fair share of involvement in the European project? Well, if you ask the people, it differs, but basically, they are not that interested in the European project. However, they are interested in the economic success that started with membership of the European Union. They all know very well that they need the EU for their own economic gain and prosperity. But they are not really interested in the project as such. And then there are some demagogues like Viktor Orbán and others, including here in the Czech Republic, who do their utmost to denigrate Europe for their own populist interests.

What was the biggest failure of the German foreign policy in Central and Eastern Europe? German policy has always had this dilemma: the relationship with Russia. The Germans have been prioritizing Russia over its immediate neighbors for over two centuries now. That’s nothing to do with Russian President Vladimir Putin speaking very good German. You can go back as far as the early 19^th century, or just remember the illicit cooperation between the Reichswehr and the Red Army in the 1920s and 1930s. It always leads to disappointment in Central and Eastern Europe.

Current German Foreign Minister Heiko Maas has spoken of redefining the term Ostpolitik as to no longer referring to Russia, but rather to Germany’s eastern neighbors… That would be nice if it would happen. But I’m afraid deeds are stronger than words. And of course, Germany should not abandon Russia in its foreign policy, but rather consider the interests of the other states, too. If you think of Russia’s aggression against Ukraine, where Angela Merkel has been mediating—after five years, some Germans still seem to have difficulties spelling out precisely who the aggressor is and the German industry is arguing for the lifting of sanctions.

How could the present divide between Western and Eastern Europe be overcome? Scrapping that famous project of the second gas pipeline [Nord Stream 2] across the Baltic Sea would be a start. It runs against the interests of Ukraine and other countries. Or speaking clearly about the situation in Hungary. Of course, the votes of Orbán’s Fidesz party were needed to make the European People’s Party the biggest political group in the European Parliament. But my impression is that German conservative politicians simply close their eyes to whatever Orbán does at home.

So we need more honesty? More honesty would be a wonderful idea.

The interview was conducted by Henning Hoff. Assistance: Matthias Hempert.

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© REUTERS/ Piroschka Van de Wouw

Let’s start in Prague. Even for the scandal-tainted Czech prime minister, the billionaire-turned-politician Andrej Babiš, it was a bizarre turn of events. In mid-November, local media broadcast the shocking testimony of his 35-year old son, who claimed that last year, associates of his father had forced him to go on an “extended holiday” to Crimea. The purpose was to prevent him from testifying in a criminal investigation into charges that his father had committed an EU subsidy fraud. The fraud charges are part of a notorious case involving a conference center near Prague formally owned by Babiš’ children, who are now also implicated. The police want to close the investigation by the end of the year. Prime Minister Babiš has repeatedly denied any wrongdoing and argues that the accusations are part of an orchestrated political smear campaign.

Amid the scandal, the opposition parties forced a no confidence vote. The social democrats, a junior partner in Babiš’ minority coalition government, decided to leave the chamber during the vote: they did not have confidence in the prime minister, but they also did not wish to vote against their own government. Their proposal to follow “the Slovak model”—in neighboring Slovakia, the discredited Prime Minister Robert Fico was replaced by his deputy Peter Pellegrini in March 2018—was vehemently rejected by Babiš. “I will never resign. Never! You should all remember,” Babiš declared in the parliament. As the Czech ruling party ANO is closely controlled by its founder and chairman Babiš, replacing him as prime minister against his will simply would not work.

Babiš had reason to be defiant. Because of the parliamentary mathematics in the 200-seat Chamber of Deputies, the two extremist parties, the communists and the anti-migration party of Tomio Okamura, were always going to determine the balance of power. Babiš rode out the crisis by showing the social democrats that Okamura’s party is ready to replace them in government and that the communists will continue to support him regardless of the investigation. He was also helped by Czech President Miloš Zeman, who publicly declared that, even if Babiš were to lose the vote of confidence, he would ask him to stay on as prime minister and form another cabinet.

What Price Power?

Babiš paid for the support of both the extremist parties and pro-Russian President Zeman by granting, for instance, some minor budget handouts to organisations that are politically close to them. But what will be much more important in the medium term is the political boost they have gained from the deal: like the president, both extremist parties are pro-Russian as well as anti-EU and anti-NATO. In fact, they are proposing limits to Czech contributions to NATO missions, and insist on a tough, uncompromising migration policy.

The alleged conflicts of interest around Babiš and his business empire have become so toxic that they have not only paralyzed Czech domestic politics but also damaged the country’s position within the EU. On December 13, the European Parliament adopted a resolution expressing concern about the Prime Minister’s conflict of interest and the use of EU funds in the Czech Republic. Most allegations focus on Agrofert, Babiš’ large business conglomerate, which is now formally owned by two trust funds and continues to be a major recipient of EU agricultural subsidies in the country. These new developments are likely to push the Czech government into a corner in the ongoing negotiations about the new EU budget. Under pressure from Brussels, Babiš will now find it more difficult to pull off the balancing act by which he cultivates ties with western EU leaders while also embracing Hungary’s populist leader Viktor Orbán.

Meanwhile, neighboring Slovakia was shaken by a different kind of political crisis. As in Belgium, the ruling coalition in Bratislava was deeply split on the Global Migration Pact. After 18 months of negotiations, the legally non-binding document on the treatment of migrants was agreed at the UN in July by all member states except the United States. At that time, Slovakia’s Foreign Minister Miroslav Lajčák was president of the UN General Assembly. The pact was formally endorsed at the UN intergovernmental conference in Marrakesh on December 10-11, but not before several countries had publicly withdrawn their support, including EU members Austria, Italy, Hungary, Poland, Latvia, and the Czech Republic.

“Populist Race to the Bottom”

The dispute within the three-party coalition government in Bratislava burst into the open after a junior partner, the pro-Russian populist Slovak National Party (SNS), demanded that Slovakia reject the migration pact, too. Foreign Minister Lajčák defended the document, criticizing its opponents for making false statements and leading a “populist race to the bottom.” He also threatened to resign if his opponents prevented Slovakia from taking part in the UN conference in Marrakesh. This was about the country’s credibility in Europe and its approach to multilateralism, he argued. If politicians have objections to the UN migration pact, they should allow diplomats to take them to Marrakesh.

Lajčák was hoping for political support from his own party, Smer-Social Democracy (SD), but he miscalculated. Weakened by recent country-wide protests against corruption, Smer-SD was careful not be outflanked on migration by the SNS. Prime Minister Peter Pellegrini said Slovakia would “never” accept a pact that described migration as a generally positive phenomenon, a position that contradicts Slovakia’s will to distinguish between economic migrants and refugees. So the tide turned against Lajčák. After a strongly worded parliamentary resolution opposing the pact was passed—supported by Smer, SNS, and the neo-fascist Kotleba party—the foreign minister tendered his resignation on November 29.

Lajčák’s U-Turn

But it took him only one week to rescind it. He said he had received guarantees from both Prime Minister Pellegrini and Robert Fico, now the chairman of the Smer party, that Slovakia’s foreign policy will not change. The real reason for his change of heart could be something different—Bratislava is full of speculation. If Lajčák left the cabinet, Robert Fico would try to return to the government, thus threatening both the fragile balance of power and the position of Prime Minister Pellegrini. Or perhaps Lajčák is simply waiting in his post until there is a new top international job available for him—distancing himself from Slovakia’s position on the migration pact might improve his chances.

In any case, despite guarantees of foreign policy continuity, the SNS feels emboldened to pursue its agenda. Its new target is the country’s new security strategy. Having been approved by the government, it was supposed to be debated in the parliament. However, the SNS asked to change its wording by further watering down references to Russia as a threat. Pellegrini offered a procedural way out, emphasizing that, as the government has already approved the security strategy, it is bound by it even without the parliament’s confirmation.

What Europe Should Do

So, what do these recent Czech and Slovak political crises have in common?

Both show that as political elites tainted by corruption cling to power, they increasingly have to turn to the pro-Russian extremists for tactical support. This shift also has foreign policy implications. First, as the main ruling parties decline, fringe parties are going to grab more seats in the European parliament elections. Second, this weakens the more pro-European governments within the Visegrád group, which also includes Poland and Hungary. This means that Hungary’s leader Viktor Orbán will gain more space within the group to expand his populist, anti-Brussels rhetoric (though he himself has come under pressure by wide-spread civic protest at home). Third, the Czech Republic in particular risks to undermine its relatively strong negotiating positions in the debate on the new EU budget and the future of cohesion policy. Fourth, if the conflict between Russia and Ukraine escalates, Prague and Bratislava will become even more vulnerable to Russian disinformation.

Overall, the outlook for 2019 is more instability, as domestic politics continue to drift into turmoil. What does this mean for their partners in Europe, first of all for Germany, both countries’ most important interlocutor? As the antagonism between the EU’s East and West continues to grow, Berlin cannot take for granted that Prague and Bratislava will continue their pragmatic approach to important EU issues. While insisting that both countries address issues of corruption and conflict of interest, Germany should also enlist France’s support to anchor their governments in the pro-European camp. At this point in time, both the Czech Republic and Slovakia need help to consolidate their strategic consensus and resist both internal and external pressures for further radicalization.

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© REUTERS/David W Cerny

Czech politics have been careening from one drama to another. Andrej Babiš may have emerged victorious after October’s national election, but he is facing an uphill battle to form a stable government. The country’s mainstream parties suffered a big blow, thanks to a large protest vote, and parliament is severely fragmented. The Czech Republic is now facing months of political wrangling that will likely extend into early 2018.

Babiš’s ANO, or Yes, party has won 78 out of 200 seats in the lower house of the parliament with eight small parties sharing the remaining 122 seats. Forming a majority government without the ANO is practically impossible; forming a new government with Babiš is going to be nearly as difficult. None of the other democratic parties appears willing to play the role of junior coalition partner. They also point to an ongoing criminal nvestigation into Babiš on allegations of fraud. The former finance minister denies any wrongdoing and calls the investigation politically motivated. Still, his image has been tarnished.

Ever the shrewd businessman, Babiš will not back down. The only parties willing to entertain Babiš are the far-right extremists and Communists – and he has rejected working with either. Nor will he allow somebody else from ANO to lead the new cabinet. This would run counter to his style as well as his agenda. Instead, he is going to form a minority government, pepper it with some well-known technocrats, draw up a broad, sweeping program, and then try to muster enough votes for a confidence vote in parliament. Expect a lot of back room, eleventh-hour deals.

So when the new parliament opens on November 20 and the outgoing government of Prime Minister Bohuslav Sobotka tenders its resignation, Babiš will be set to take power. To this end, he has made a deal with President Milos Zeman who, in spite of poor health, wants to run for re-election in January 2018. To win, he needs ANO’s voters, so he wants to ensure that the largest party will not come up with its own presidential candidate. President Zeman has already assured the ANO leader that if Babiš cannot win a vote of confidence in the first attempt, he will be nominated for a second attempt.

Who is the Real Babiš?

The Czech Republic’s new strongman is a bundle of contradictions. He presents himself as an anti-establishment leader and an anti-corruption crusader leading the charge against traditional, mainstream parties. He has promised the public he will govern more effectively, or, as his slogan puts it: “run the country like a family business.” Yet he has profited significantly from being part of the establishment during the transition period since the 1990s. Babiš is the second-richest businessman in the country and a media mogul. Moreover, ANO has served as the junior coalition partner in the government of outgoing Prime Minister Sobotka’s. Babiš himself had a decent run for more than three years as finance minister – until he was dismissed this summer over the fraud investigation into EU subsidies for his company.

It is also important to note that Babiš’ business conglomerate stretches across the food, chemical, and media sectors, employing 33,000 people in 250 companies; his Agrofert Holding company spans several EU countries, including Slovakia, Hungary, Germany, and Poland. Even if he were to put his business holding into a blind trust and claims not to have any control over it anymore, Babiš faces many conflicts of interest that will likely constrain him along the way.

Bloomberg or Berlusconi

Babiš’ victory has raised concerns in Brussels; some fear the Czech Republic could now drift in an illiberal, anti-EU direction. Babiš, however, has indicated he is far more interested in domestic policy, and that there will be more continuity in EU affairs than change.

“My name is Andrej Babiš. Perhaps you have heard about me,” he wrote in a letter to EU ambassadors in Prague a few days before the October elections, which was leaked to the media in early November. In the letter, Babiš rejected the description as a “Czech Trump” and similar comparisms. He wanted to be judged by results, he wrote: “So-called traditional political parties say that I am a threat to democracy, since I want to limit parliamentary debates, but I just want to retain German [Bundestag] standards and have rules in these debates’. The letter closes on a personal note: ‘I came to politics to bring transparency. I have not joined politics to enrich myself since I am already rich enough. I came to fight against corruption and waste, clientelism and bring [more] efficiency into governance.”

Babiš points to Michael Bloomberg, the former mayor of New York and successful businessman, as his role model. Perhaps a more appropriate comparison would be Silvio Berlusconi. With Babiš, too, the biggest concern is that his huge concentration of power – and the existence of skeletons in the closet – will cause tensions with the country’s judiciary. This could possibly lead to even more opportunities to exercize political control.

Opportunist, Not Ideologue

However, unlike Orbán in Hungary and Jarosław Kaczynski in Poland, the 63-year-old Babiš is not an ideologue, but a pragmatic businessman. A native Slovak, he cannot be a Czech nationalist; he still speaks a strange and sometimes funny mixture of the two languages. His stakes are indeed in domestic politics, and his interests lie in regulatory policies that may affect his giant business empire. That may also explain why his anti-corruption message lacks depth.

Babiš is eclectic in his rhetoric and actions. He has no strong institutional, cultural, or social connection with his constituency or broader Czech society, and will need to rely on his media and marketing machine to maintain his glossy image and popular support.

His European policy is bound to be pragmatic, non-ideological, and very transactional. There are, of course, there are strong euroskeptic sentiments in the Czech Republic which will limit Babiš’ room to maneuver, but that is nothing new. The previous Social Democrat government was also cautious when talking about Europe. Babiš will probably not improve his country’s EU policy with clear ambitions and strategic consensus, but there are no signs that Prague’s outlook on Europe would significantly worsen.

The ANO’s foreign policy program is underdeveloped, and Babiš has little interest in pursuing it proactively. His instinct is to maintain the status quo rather than deepen EU integration further, and his approach to the current debate on the EU’s future is likely to be rather opportunistic.

Defense and the Euro

However, there is ample room to engage Babiš on EU affairs. He will definitely need good advice and guidance, which is exactly why EU politician Guy Verhofstadt visited Prague in November. The two need each other: Babiš wants a better image in Brussels, and Verhofstadt, as leader of the Alliance of Liberals and Democrats, would like to have another EU leader from his political family. What’s more, Babiš will instinctively try to stay close to Germany and look for new allies in central Europe, like Austria’s Sebastian Kurz.

This could play to the EU’s advantage. It should be possible to convince Prague to get on board and endorse some pragmatic changes. The obvious case is defense and security policy, where it has the support of the public. In fact, all the major parties support Czech participation in the Permanent Structured Cooperation (PESCO), a framework for defense cooperation. But public support can cut both ways: Babiš is also likely to pursue a tough line on migration, refusing any relocation of refugees in the Czech Republic.

Those who advise Babiš on EU affairs within his own party – such as MEP Dita Charanzová – are proponents of the Czech Republic adopting the euro in the longer run. In the short term, it will be interesting to see whether the new Czech government can be convinced to formally enter the euro “antechamber” – the European Exchange Rate Mechanism which limits the floating band of national currencies to the standard fluctuation of plus or minus 15 percent.

An Illiberal Club of Two

On the regional level, the new government is not likely to be very active within the Visegrad Group. Unlike Poland or Hungary, a Babiš-led Czech Republic has no stake in escalating conflicts with EU institutions. The constructive Czech-Slovak tandem within the Visegrad Four is likely to remain in place. As a Eurozone member, Slovakia will gravitate even more toward the EU core, while Babiš will navigate his own path.

So does that mean that Berlin and Paris need not worry? The good news is that the illiberal club of central Europe is still limited only to two members. Yet there is bad news, too: there are concerns that under Andrej Babiš , the Czech Republic will remain a weak and somewhat unreliable partner, mostly absent from the common endeavor to shape EU’s future and overcome East-West tensions.

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