Czech Republic

he centre-right coalition government has come together and tentatively approved a proposal from Finance Minister Miroslav Kalousek, also the leader of the coalition party Top 09, to contribute a EUR1.5bn to the IMF. The loan is less than was originally sought by the EU/IMF to bolster the IMF's firepower with regards to troubled European states. Given the fractious nature of the coalition and the fiscal prudence for which these parties are renowned, we view this development positively. However, given that President Vaclav Klaus has vowed not to hand over any more powers to the EU during his term (ending in 2013), we are sceptical that this will be approved at the presidential level.

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