THE ROLE OF INTERNATIONAL ORGANIZATIONS IN THE CZECH REPUBLIC

1
THE ROLE OF INTERNATIONAL ORGANIZATIONS IN THE
CZECH REPUBLIC

• Group Members
• Despina Mertzios
• Martina Sedmak
• Lenka Strakova
• Ekaterina Zarovsky

2
CONTENTS

• Introduction The Czech Republic
• The World Bank Group and the IMF
• EIB and EBRD
• NGOs

3
1. GENERAL CHARACTERISTICS OF THE CZECH REPUBLIC

• 1st January 1993
• area 78,864 km2
• population 10.3 million
• density 130 inhabitants/km2
• 3 historical territories

4
1. LOCATION IN CEE
5
1. REGIONAL STRUCTURE
6
1. SETTLEMENT STRUCTURE

• highly diversified and dispersed across the
  territory
• sub urbanisation
• urban population 70,9
• non - urban population 29,1

7
1. POPULATION (I)

• decrease in population - low number of births
• Development of Population in the Czech Republic
  
• in 1991 2000

8
1. POPULATION (II)

• life expectancy growing
• ageing of population
• national structure - relatively homogenous

9
1. INFRASTRUCTURE

• transport infrastructure
• highways, roads, railway network
• density vs. quality

10
1. MACRO-ECONOMIC DATA (I)

• 1. GDP growth (significant decrease at the
  beginning of 90s recovery of economic growth
  from 1993 economic slowdown in 1997 economic
  growth since 1999 onwards)

11
1. MACRO-ECONOMIC DATA (II)

• 2. Inflation (2 price shocks - 1991 and 1993)

12
1. MACRO-ECONOMIC DATA (III)

• 3. Unemployment (appeared at the beginning of
  transformation process low between 1992-1996
  growth since 1997)

13
1. MACRO-ECONOMIC DATA (IV)

• 4. Regional unemployment October 2003

14
2. INTERNATIONAL BANK FOR RECONSTRUCTION AND
DEVELOPMENT (IBRD)

• Czechoslovak Government's reform program in 1991
  - SAL US450 million (macroeconomic stabilization
  and structural reforms)
• modernization of individual sectors (incl. energy
  and telecommunication sectors)
• Global Environment Facility (GEF) grants
• power plant has been built in Kyjov

15
2. IBRD (I)
Source The World Bank, Project Statistics in the
EU Accession Countries  Lending Activities by
Accessing Countries between 1989 and 2002
16
2. IBRD (II)

• Things to be done
• to reduce the fiscal deficit
• to reduce unemployment as well as regional
  disparities and differences in unemployment
  levels across the country
• to finish the restructuring and privatisation of
  major enterprises
• to complete the reform of the pension and social
  benefit systems and finalization of the
  resolution of the bad assets

17
2. INTERNATIONAL FINANCE CORPORATION (IFC)

• member of IFC in 1993
• total project costs US1762 m (18 projects)
• strategic priorities were privatization and
  restructuring, providing long-term financing for
  first- and second-tier local firms in sectors,
  institution-building, infrastructure,
  environmental clean-up investments and SMEs
• privatisation and modernization of MOKRA (1992)
• construction material sector - CEMBRIT
• invested US75 m and mobilized US150 m to
  support restructuring NOVA HUT (1997)
• its role is diminishing

18
2. MIGA, IDA, ICSID

• MIGA - issued a US4.9 million guarantee to
  Raiffeisen-Leasing GmbH of Austria for 5.4
  million non- shareholder loan to Raiffeisen
  Leasing BOT s.r.o in the Czech Republic (2003)
• IDA the Czech Republic is a donor
• ICSID - Case No. ARB/97/4 CSOB Bank, a.s.v.
  Slovak Republic

19
2. INTERNATIONAL MONETARY FUND (IMF)

• membership on January 1, 1993
• a stand-by loan (US471 million)
• purpose to address short-term problems in
  balance of payments
• 1995 - entire IMF debt had been repaid ahead of
  schedule
• monetary crisis in 1997 (CZK was not devaluated
  to the extent expected)
• in 1999 the CNB occasionally intervened to
  prevent the appreciation of the CZK
• cooperation between the IMF and the Czech
  Republic is ongoing

20
2. CRITICISM ON THE IMF

• voting in the organization is based on the
  amount of member contributions to IMF funds
  
• the conditions for receiving IMF assistance
  unfair or harmful
• the structural funds or conditionality
  required for assistance are set up to
  maintain a dependent relationship between the
  economically developed countries and others

21
2. CONCLUSION

• pre-graduation arrangements with the World Bank
• ongoing relations with the IMF
• main roles
• IMF - to promote international financial
  stability and the macroeconomic stability of
  member countries
• WB - to help countries reduce poverty,
  particularly by focusing on the institutional,
  structural, and social dimensions of development
• each institution needs to focus on its respective
  core tasks but working together where their
  responsibilities overlap

22
3. EUROPEAN INVESTMENT BANK (EIB)

• set up in 1958
• EIB is an autonomous institution within the EU
• enlargement as one of the objectives
• participant in the EUs development and
  cooperation policies in about 150 countries

23
3. EIB LOANS TO THE CZECH REPUBLIC SINCE 1990 (I)
24
3. EIB LOANS TO THE CZECH REPUBLIC SINCE 1990 (II)
25
3. EIB AND RESULTS FOR THE CZECH REPUBLIC

• EIB projects always in conjunction with others
• responsible for grant aid - ISPA and SAPARD
• implementation of different schemes

26
3. EUROPEAN BANK FOR RECONSTRUCTION AND
DEVELOPMENT (EBRD)

• established in 1991
• helps building market economies and democracies
  in 27 countries
• largest single investor the region
• project financing for banks, industries and
  businesses
• supports privatisation and restructuring
  state-owned firms

27
3. EBRDs PORTFOLIO IN THE CZECH REPUBLIC
28
3. EBRD AND RESULTS FOR THE CZECH REPUBLIC

• 80 of economic activity in private hands
• GDP growth is good despite weak economic
  performance of export markets
• in 2002 FDI of US 9 billion
• still a number of reforms are needed to further
  enhance the competitiveness

29
4. NGOs

• what is an NGO
• important for the community
• important for the companies

30
4. NGOs IN THE CZECH REPUBLIC

• breakdown of communism
• fields of action
• types of institutions
• sources of financing

31
4. FIELDS OF ACTION

• human rights
• buliding democratic system and installing
  democratic values, elections
• making connections with Western Europe
• lobbying for both government and foreign
  interests
• education
• media
• environment
• corporate social responsability in business