This weekend Czechs go to the polls in a hotly-contested general election that pits a billionaire populist against his former colleague, a dreadlock-sporting digital pirate and a half-Japanese, Islamophobic right-winger.
But amid the emotive campaign, being held against a backdrop of economic prosperity and a thriving digital industry, the Czech Republic looks set to elect its second richest man–an EU-sceptical agriculture and media oligarch who could soon be in jail–to become prime minister.
Andrej Babis has been dubbed the ‘Czech Trump’: he’s populist, brash and used to getting his own way. But it’s an unfair comparison – and one that doesn’t really illustrate the businessman’s approach to this election.
Bratislava-born Babis, owner of $6.1 billion-revenue Agrofert, has been member of parliament for capital city Prague since 2013. He served as the finance minister of incumbent prime minister Bohuslav Sobotka until May this year, when he was forced out after a financial scandal that has loomed large over this election. His ANO Party (‘Ano’ is Czech for ‘yes’) is centrist, business-friendly – and heavily populist.
Babis is accused of formulating tax laws to eliminate business rivals. He still faces the courts, and could even be behind bars by the time he’s inaugurated. But that’s not really what this election is about. One thing it most certainly does hang on is immigration, particularly from the Middle East, which has dominated European politics for years.
The other is the economy.
Only, the Czech Republic’s economy is flying: growth is above 3% and its currency, the koruna, is performing as strongly as any other in Europe. The Czech Republic has the lowest unemployment rate among the EU’s 28 constituent nations. Sobotka has overseen one of the best periods in Czech economic history.
Babis wants better. Both he and Sobotka, who is campaigning for re-election with his Social Democrats, have slammed telecommunications firms for charging too high on data. Babis in particular wants to lower sales and other taxes. He wants to run the country like a business.
Babis also wants to revolutionize state-owned conglomerate CEZ, which has a market capitalization of $11.3bn. But small and medium-sized businesses will also be paying close attention to the vote – not least a growing band of entrepreneurs that have made the Czech Republic one of Europe’s best tech hubs. AVG and Avast are its two unicorns, while a host of startups have grown up around them, boosted by a big talent pipeline.
They aren’t hoping for much from Tomio Okamura, a Tokyo-born far-right nationalist who has called Islam an “ideology” and who has called for total detachment from Brussels. Babis, too, has rained invective on the EU – though he has kept his exact plans for the bloc vague.
This worries Petr Koubsky, managing director of Prague edtech firm iCollege, who otherwise echoes views that the government does little to help the startup scene. “Generally speaking, the Czech election is about liberal democracy versus populism – the latter probably winning,” he tells Red Herring. It doesn’t make a difference for tech sector in the short term – it gets virtually no government support anyway.
“However, the negative effects may cumulate after some time,” he adds. “For instance, discussion about leaving the EU would render Czech Republic as unstable and unreliable country for foreign investors.”
It is rather the Pirate Party, led by 37-year-old dreadlocked activist Ivan Bartos, which has made tech a central platform of its election pledge. The party has campaigned on jailing financial wrongdoers and preventing tech from “becoming a tool of digital totalitarianism.”
But alongside the far-left rhetoric, the Pirates’ plans to push public WiFi, regulate roaming costs and increase fiber connectivity have excited many, mainly young, Czech voters. The party also goes against former governments, which, according to tech consultant Jan Burianek, viewed the Internet as “magic.
“Nobody knew how to do it (implement widespread digital reforms),” Burianek says. “If some of (the Pirates) come to high positions, I expect it will move modern communications into the 21st century. It will help, definitely.”
“The most interesting party from a tech scene view is definitely the Pirate Party, which wants to digitalize everything and move us more to an Estonia course,” adds Vojta Rocek, founder of analytics firm Stories.bi. He estimates that the Pirates will win 6-8% of the vote. They won’t get his. “From my point of view they are a bunch of cryptocommies,” he says.
In fact Cyril Pöschl, a tech founder, developed a data matrix of the lead parties. The ANO and SPD are roughly similar while the Pirates, Greens and KSCM–the former communist party–have correlative policies.
Which suggests that election victory will go to the biggest personality. That is likely Babis. The oligarch has claimed to want to make things better for SMEs. But few in the country’s tech crowd believe him. Some believe he is openly hostile to the ecosystem. “If he sets making life of startup people a hell as his personal goal, I think he could achieve it to some extent, but I do not think he cares that much about startups,” says Honza Steinbach, CEO at Pilsen-based TechHeaven.
“If the election forecasts turn to be true in the form of substantial influence of ANO or SPD, this will be in no way positive for digital economy and technology industry,” adds tech consultant and expert Daniel Docekal, “Those are still the same subject, and people, whose relationship to technologies is rather non-present and there is no interest to make (the Czech Republic) a digital and/or technological power.”
Rocek is similarly skeptical. “(Babis’) bureaucracy liquidates competition in every segment he conducts business. He’s not like Trump; he’s Putin-like: KGB tactics, manipulations, lies etc.
“Trump is self-obsessed, a narcissist,” he adds. “Babis is worse. He does everything for more money – and only for more money. No values, no purpose, no nothing. So there is almost no chance he could help small business because he doesn’t see a point in doing exactly that.”
Rocek, and many others in the flourishing Czech tech scene, will be voting with interest this weekend. But few are expecting much other than lip service to the industry from whomever wins. “In Czech Republic we just don’t give a shit,” he says. “That should be our motto.”