RPT-Czech govt wins confidence vote but seen as weak

...

By Jan Korselt

Czech Prime Minister Mirek Topolanek's new centre-right government narrowly won a confidence vote on Friday to end months of political deadlock.

However, Topolanek said an early general election could still be needed if the government is unable to get its reforms through a divided parliament.

The vote ends for now a crisis which crippled policy-making in the EU member since an election last June split parliament down the middle between centre-right and left-wing forces.

The 50-year-old prime minister's three-party coalition holds just 100 seats in the 200-member lower house of parliament.

But he won the vote thanks to two rebel opposition deputies who did not attend, giving him a victory over the 97 opposition votes. One other deputy abstained from voting, but was present in the lower house.

"I don't think this is (a result) that calls for major jumping for joy in triumph. Hard, tough work awaits us," Topolanek said. "Whether or not we try to trigger an early election will be a consequence of the situation in the lower house and if we are able to carry out (reforms)."

The coalition is made up of Topolanek's right-wing Civic Democrats, the centrist Christian Democrats and the Green Party.

It will find it difficult to push through its liberal economic reform agenda, such as tax cuts, pension and health reform and a reduction in welfare spending.

INTERNAL STRAINS

The central European country of 10 million people needs to reverse a trend of deepening budget deficits which have delayed plans to adopt the euro beyond 2010.

The two rebel deputies, who split from the leftist Social Democrat caucus, have not promised to back any legislation and analysts said political instability may persist in the coming months.

"If the government wants to carry out real reforms, then the probability it will remain in power is very small," said political analyst Pavel Saradin. "If it wants to perform only half-baked reforms that will please all ... it may function for the entire election period (until 2010)."

Not only will the government lack a parliamentary majority, but it will also be strained by internal differences on issues such as energy policy -- the Greens adamantly oppose building new nuclear power plants and expanding coal mines, while the Civic Democrats see a future in atomic energy.

"The news is ... likely to be greeted cautiously by the (currency) market wary of cost of any concessions granted to secure this outcome," said Nicholas Kennedy, an analyst at 4castweb. (Additional reporting by Jan Lopatka and Alan Crosby) ((prague.newsroom@reuters.com; Reuters Messaging: alan.crosby.reuters.com@reuters.net; +420-224 190 474; editing by Keith Weir))

Keywords: CZECH GOVERNMENT/

[PRAGUE/Reuters/Finance.cz]