News / Europe

Czech Tycoon Emerges as Kingmaker

Circus owner Jaromir Joo, right, holds tiger cub as he congratulates Andrej Babis, leader of ANO movement, Prague, Oct. 26, 2013.
Circus owner Jaromir Joo, right, holds tiger cub as he congratulates Andrej Babis, leader of ANO movement, Prague, Oct. 26, 2013.
Reuters
Czech Social Democrats won a slim victory in a parliamentary election on Saturday but faced a tough task forming a government after a wave of voter anger over sleaze and budget cuts propelled new protest parties into parliament.
 
With most results in, Bohuslav Sobotka's center-left, pro-European Social Democrats had 21 percent of the vote, well short of the 30 percent they had targeted and in need of more than one coalition partner to build a stable government.
 
In an outcome echoing the success of anti-establishment parties elsewhere in Europe such as Beppe Grillo's 5-Star movement in Italy, the big winner was an anti-graft movement ANO (Yes) led by Slovak-born billionaire businessman Andrej Babis.
 
The Slovak-born billionaire and political novice now becomes a king-maker of Czech politics. The mercurial 59-year-old overcame being a non-native Czech speaker and a hazy political program to win 18.7 percent of the vote in the election, just behind the Social Democrats, who garnered a disappointing 20.5 percent.
 
Given rivalries and ill-will among some of the other parties, it seemed the formation of any new government could require the involvement of a candidate whose campaign consisted of a simple message — that he was not a politician.
 
"I would not go into politics if the country functioned normally," Babis told Reuters in an interview last month.
 
"We could be much better off. We used to be among the best European countries before World War Two and we should take advantage of the potential we have."
 
Czech voters, tired of a long string of graft scandals that have tarnished the political elite, saw Babis as a self-made man who earned money from business rather than shady public tenders.
 
"He is making the same appeal as [Eurosceptic Frank] Stronach in Austria or [Silvio] Berlusconi in Italy, which is that he is a practical businessman who can get things done, who has done things in life, and who can run the country like a firm," said Sean Hanley, senior lecturer of Slavonic East European Studies at University College London.
 
"He has managed to put himself across as an anti-establishment outsider, but also as fairly moderate and sensible."
 
Yet the wealthy Babis, a former Communist party member, is also an unlikely rallying point for Czechs left behind in a society where the gap between rich and poor has widened since the fall of Communism.
 
Babis first built a career in a Socialist-era chemicals trading firm during the 1980s, which he parlayed into a multi-billion dollar diversified business after the Velvet Revolution of 1989 that swept the Communists from power.
 
His companies employ 28,000 people across central Europe, and had a turnover of $6.91 billion last year. Forbes magazine estimates his net worth at $2 billion.
 
Critics, however, point out that he prospered in the same post-communist environment that he now criticizes. Babis has said he would keep ownership of his firms even if he entered government.
 
An executive familiar with his empire says Babis, a demanding boss who only sleeps a few hours daily, keeps tight control of all of his businesses.
 
He also eschews gadgets, and until recently carried around a desk calendar to update his schedule, saying on his Twitter account: "Nobody will hack this."
 
Babis won over voters with his straightforward talk, and has overcome suspicions surrounding his membership of the Communist Party as a rank-and-file member, something he has said he did to advance his career.
 
He has also admitted to having had contacts with the hated communist secret police, which he said was part of his job involving foreign firms, but he vigorously denies allegations he was an agent and is contesting them in a Slovak court.
 
Earlier this year, Babis agreed to buy two national newspapers, raising fears of meddling with the press.
 
Soon after, he called a reporter to demand an explanation as to why the newspaper did not cover Babis's news conference. He later apologized and pledged not to influence content, yet several senior journalists left.

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