RELATIONS BETWEEN POLITICAL ELITES AND PRO-CHINA BUSINESS

The media analysis  and the following questionnaire survey (in Czech) uncovered the widespread opinion that the reason for the change of the Czech foreign policy toward China is not a strategic reformulation of the national policy strategy, but rather partial interests of political and economic elites. The companies often cited in this context are PPF and CEFC, and on the level of political parties, the dominant position is allegedly held by the Social Democrats (Česká strana sociálně demokratická, ČSSD).

ChinfluenCE therefore focused on mapping the links between the actors who did not directly comment on China in the media, but who could influence the Czech-Chinese relations through their ties on the political and economic elites. The unique interactive map visualizes the relationships among key actors. The public version of the map is based exclusively on open-source information on key actors and it shows the ties based on party membership, present and past business activities, personal links as appearing in the media, etc.

We can easily trace from the map that the key nodes from which the other ties spread represent a few (political) entrepreneurs and a number of institutions. Social Democrats (ČSSD) deserve special attention within this network. Various sources inform that party links with the Communist Party of China had been allegedly established even before the recent turn in foreign policy, personally guaranteed by politicians like Jan Hamáček, the current leader of the Social Democrats (ČSSD), current Minister of Foreign Affairs and acting Minister of Interior, and the past Chairman and present Vice-Chairman of the Chamber of Deputies. More importantly, ČSSD has become a ‘breeding center’ for politicians and entrepreneurs (and the combination thereof) who are connected to the current pro-China policy. This group includes not only President Miloš Zeman (Chairman of ČSSD between 1993 and 2001), but also people like Jan Kohout, a career diplomat turned social democratic politician who became Zeman’s advisor on China in 2014 and the President of the New Silk Road Institute Prague a year later.

Two influential names include Jan Birke and Tomáš Bůzek. Jan Birke is a former Director of Jiří Paroubek’s Prime Minister cabinet and currently a Member of Parliament as well as the leader of the Social Democrats’ Regional Committee in the Hradec Králové Region. Birke’s ties are not limited to the political domain – in 2010 he helped the PPF Group get a license for their Home Credit company in China. With his interlinked political and business activities, he is a less known counterpart of the most visible and active political entrepreneur in contemporary Czech-China relations, Jaroslav Tvrdík. The second name is Birke’s former MP Assistant Tomáš Bůzek, who has links to most of the organizations connected with the pro-Chinese policy in the Czech Republic, such as the Mixed Czech-Chinese Chamber of Mutual Cooperation (Smíšená česko čínská komora vzájemné spolupráce), CEFC (where he worked as a spokesperson and member of the Board of Directors), and Kohout’s New Silk Road Institute Prague.

Jaroslav Tvrdík became the epitome for a new breed of a political entrepreneur. Hailing from a career officer, after 2001 he quickly became an influential member of the Social Democratic Party, exchanging several roles from Defense Minister through election manager to the party chairman’s advisor. In 2012 he took over the Mixed Czech-Chinese Chamber of Mutual Cooperation, and three years later became a Deputy Chairman of the Board of Directors of CEFC Group (Europe) Company, which gradually became the best-known business groups in the media representing Chinese investment in the Czech Republic. CEFC also invested in the Empresa Media, a company owned by Jaromír Soukup. Soukup, apart from being the owner of TV Barrandov (where he himself, rather uncritically, presents the program “Week with the President”), is also a member of the advisory body of Kohout’s New Silk Road Institute Prague.

Tvrdík brought further formerly high-profile Czech politicians into CEFC – among other Štefan Füle, former Minister of the Czech government (and even before that, Tvrdík’s deputy at the Ministry of Defense), ambassador of the Czech Republic to NATO and European Commissioner for Enlargement, who is now a member of the Supervisory Board of the company. Marcela Hrdá followed a similar path; former Director for Transformation of Czech Airlines (when, between 2003 and 2006, Tvrdík was the President), Chairwoman of the Board of Directors of Empresa Media and also an adviser to Michal Chovanec (Minister of Defense under Bohuslav Sobotka until December 2017).

Tvrdík’s story might end here, as an account of an able political-economic operative who saw a unique opportunity in the new international climate and fully utilized it to his advantage. But this is only a part of the more complex sphere of influence of economic actors resulting in a reorientation of the foreign policy, which was given a blessing from the most influential political ranks (specifically, under the patronage of President Miloš Zeman). In 2010, the PPF Group – with formal headquarters in the Netherlands, but owned by the Czech billionaire Petr Kellner – hired Jaroslav Tvrdík to lobby on behalf of its interest in China, in particular for its retail banking branch, Home Credit. This company was present in China since 2007, but only received the local license to provide customer credit services in 2010. Despite of this breakthrough, the final goal of receiving a nation-wide license for this business took further four years to achieve. It was in this period that the Czech Republic’s shift towards China was initiated. The link between these two processes remains – in view of the confidentiality of the key information behind them – hypothetical, but it is necessary to at least recognize and allow for their functional connection.

What the cases of CEFC and PPF represent is the risk of a business influence over an important portion of the Czech foreign policy, with potentially far-reaching consequences. The creation of the impression that China presents a full-fledged economic alternative is not based on real economic data. The media discourse analysis, questionnaire survey and visualization of open source information are naturally not sufficient to uncover the exact causal logic of their effects, and the information obtained from the interviews is often not verifiable without further access to the relevant actors involved. An undeniable fact remains, however, that the Czech foreign policy towards China has deviated from its previous course without any public political debate and without a clear redefinition of its strategic priorities, but apparently under a specific impact of the interest of specific business groups, whose activities completely failed to meet the requirements for transparency and public control.