Discussion Papers 2001.
Role of the Regions in the Enlarging European Union 32-45. p.
Role of the Regions in the Enlarging European Union
0 Edited by Zoltan Cal, Pecs, Centre for Regional Studies, 2001
REGIONAL POLICY IN THE
CZECH REPUBLIC
Michaela Brizova
Main trends and problems of regional development
in the Czech Republic
Since 1990, the development of the individual regions has shown differing dy-
namics due to the transformation of the Czech economy into a standard market
economy and depending on different starting conditions. Problems have arisen
especially in areas with an above-average proportion of uncompetitive and inef-
fective productions, which were attenuated with impacts on the loss of eco-
nomic dynamics, on the standard of living and on the employment rate within
the region.
The level of economic development of the individual regions and their
problems can be assessed in terms of selected indices characterizing especially
the labour market, the employment rate, the standard of living, the state of the
infrastructure etc.
In the sphere of the labour market, most sectors of the national economy
have experienced a drop both in the production and in the employment rate due
to economic changes; jobs have been reduced in connection with over employ-
ment and the attenuation of ineffective productions. The drop of the employ-
ment rate in industry has concentrated primarily in coal-mining, metallurgy,
engineering and also in consumption industries (especially the textile industry)
with adverse impacts felt in regions with the concentration of these produc-
tions. The highest decrease in the employment rate has been marked in regions
of North-West Bohemia, Northern Moravia and the Kladno region. The drop in
the employment rate was projected markedly in agriculture, especially as a
consequence of the implemented transformation and privatisation but also due
to the restriction of agricultural production as a consequence of balancing of
the supply with the demand of the population. A number of released workers
from industries and also from agriculture have gradually found new jobs in the
tertiary sector, which was significantly under dimensioned before 1990.
Gradually implemented transformation changes have had direct impact on
the unemployment rate. Although it did not exceed 3.5% in the period prior to
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
Discussion Papers . Special
Regional Policy in the Czech Republic
33
1996 and thus it has shown very high levels in comparison with other countries,
this level is exceeded significantly in some districts of the Czech Republic.
The problem of high unemployment is concentrated primarily in a larger
number of districts in Northern Bohemia and it still persists in some regions of
Northern Moravia. Regional differences have increased again lately — after a
certain improvement in the 1994-1995 period; this is ... in the evaluation of the
unemployment level; see the following overview for the ten "best and worst"
districts in the Czech Republic.
Table 1
Unemployment rates of the less favoured and the most favoured ten districts,
1992-1997, %
District category
1992
1993
1994
1995
1996
1997
December
Average unemployment rate in the ten
5.34
7.36
6.37
6.24
7.28
10.24
"worst" districts (in %)
Average unemployment rate in the ten
0.87
1.20
1.02
0.92
1.16
2.09
"best" districts, including Prague (in %)
Difference between the averages of the
4.47
6.16
5.35
5.32
6.12
8.15
ten "best and worst" districts
In the course of 1997, there was a further gradual increase in the unemploy-
ment rate due to deepening problems in the decisive industries and in agricul-
ture. As at 31 December 1997, it reached 12.4% in the Most district, 12.1% in
the Chomutov district, it exceeded 10% in the districts of Louny, Teplice and
Karvina and it exceeded 9% in the districts of Kladno, Mein, Znojmo, Jesenik
and Pferov, with a tendency of further gradual growth.
The problems of unemployment have concentrated in selected micro regions
in some districts (the hinterland areas of authorized local authorities); these
included e.g. the micro regions of FrYdlant and Nove Mesto pod Smrkem (dis-
trict Liberec), Vranov nad Dyji and Hrugovany (Znojmo), Morayska Tfebova
(Svitavy) or Vitkov (Opava).
In the sphere of the staridard of living, average wages are an important indi-
cator for evaluation. The highest level of average wages is reached in the capi-
tal, Prague, and in its immediate surroundings. A high level is maintained in
some districts with the dominance of coal mining and heavy industries (Os-
trava, Most, Karvina, Sokolov), districts with significant engineering produc-
tions (Mlada Boleslav, Plzen) and others. The lowest relations are reached in
districts with a stronger representation of agriculture, consumption industries
and other productions with a lower wage level (Bruntal, Znojmo, Svitavy,
Blansko, Vygkov, Chrudim, Semily, Sumperk, Nachod, Pelhiimov etc.).
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
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M. Brizova
Comparatively high regional differences are also reached in the level of in-
come from taxation for local budgets calculated per head (see the attached
map), which was significantly the best in the capital, Prague, where it reaches
more than double values in comparison with the average for the Czech Repub-
lic. Big cities follow at a considerable distance, in the following sequence:
Brno, Plzen, Ostrava, and then the districts of Hradec Kralove, Melnik, Mlada
Boleslav, Ceske Budejovice, Melnik and others. On the contrary, the lowest
income from taxation is reached in districts which form the background to big
cities (Brno-country, Plzeii-north, Plzeri-south) and, further, in the districts of
Jesenik, Tiebic, Nov , Jiein, Blansko, Bruntal, which reach less than 65% of the
average for the Czech Republic (for instance, the district of Brno-country
reaches only 45% and the district of Jesenik reaches only 55% of the average
level of the Czech Republic).
Regional differences have been influenced especially by the following fac-
tors since 1990:
a) A significant drop in the production and employment in heavy industries
(coal-mining, metallurgy, heavy engineering, chemical industry etc.) which
have dominated and still remain as the main industries in the economic struc-
ture of Northern Moravia and North-West Bohemia. Some micro regions expe-
rience a negative impact of the decline of the textile industry and electrical
engineering, with serious impacts on their employinent rate (Fr5/dlant region,
some regions in Eastern Bohemia, Ro'inov p. R. and others).
In the coal-mining industry, there has been a gradual decrease in the mining
of both black coal (a drop from 20 million tons to around 17 million tons, i.e. to
around 85% in the 1991-1995 period) and brown coal, including lignite (a drop
from 72.5 million tons to 55 million tons, i.e. a decrease to around 75% in
comparison with 1991). As a consequence of this, there has been a significant
drop in the number of workers from 128,000 to 70,000 workers, i.e. a drop of
about 45%, which has been reflected with a higher intensity in the Ostrava-
Karvind District (a drop from 77,000 workers to 32,000 workers, i.e. a decrease
of about 60%), whereas the number of workers in the North-Bohemian Brown
Coal District has dropped by 7,000 workers, i.e. by about 25%. The gradual de-
creasing in the volume of mining and in the numbers of workers will still con-
tinue in the following years. The extent will depend on the adoption of aims
stated in the draft power policy of the Czech Republic, which concerns a further
restructuring of the coal-mining industry, an updating of the attenuation of coal-
mining, the assessment of territorial environmental limits for coal-mining etc.
The metallurgy of iron, secured by enterprises located especially in Northern
Moravia (Vitkovice, Tfinecke 2elezarny, Nova Hut', Valcovny plechu Fr5/dek-
Mistek, Zelezarny a dratovny Bohumin), in Northern Bohemia (Valcovny trub
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
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Regional Policy in the Czech Republic
35
— DIOSS Chomutov, 2elezarny Chomutov) and in Kladno (Poldi Steel), experi-
enced a drop of about 30% in the production (a drop in the production of pig
iron from 10 million tons in 1989 to 7 million tons in 1992) accompanied by
reductions in the number of workers. However, the situation of the enterprises
stabilized in the following years due to relatively favourable conditions for
securing increased exports with the use of comparative advantages (lower
prices of ores from the CIS, wage costs, an advantageous exchange rate). How-
ever, decreasing production volumes, including export volumes can be expected
in these industries in the following period, accompanied by reductions in staff
numbers due to decreased foreign demand, restructuring of the iron works and a
modernization of technological equipment.
b) The reductions in the numbers of workers in agriculture, which were
marked especially in mountainous and piedmont regions and in areas with a
high relative representation of this sector in their economic structure. This trend
has been reflected in a number of rural areas and lower funding resources for
local budgets have also accompanied it.
The number of workers in primary agricultural production dropped in the
course of the ongoing transformation accompanied by a decline in the volumes
of agricultural production by almost 60% in the 1989-1995 period. Districts
where this indicator reaches almost double values in comparison with the aver-
age for the Czech Republic include especially those in Western Bohemia
(Plzen-south, Plzen-north, Domailice, Klatovy, Tachov), Southern Bohemia
(Pelhfimov, Pisek, Strakonice), Eastern Bohemia (Havlin& Brod, Svitavy,
Ji6in, Rychnov n.K.) and in Southern Moravia (Znojmo, Z'd'ar n.S., Tfebi6).
The fundamental problems that remain in these regions are the completion
of restitution and transformation processes, an unfavourable income situation of
entrepreneurs especially in areas with less favourable conditions for farming,
which does not make it possible for their production to become competitive.
Moreover, the average wages are at a low level, about 15% lower than the na-
tional average (in addition, workers in agriculture show a significantly lower
education level and a less favourable age structure).
In the interest of reducing regional differences and securing support for ag-
ricultural activities in areas with worse conditions for farming, use will con-
tinue to be made of support programmes concentrated on the restructuring of
agricultural production and on the development of non-production functions
(afforestation, grassing, support for the breeding of cattle in mountainous and
piedmont regions), on the support of water systems and on the utilisation of
other programmes, such as the renovation programme for rural areas and others.
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
Discussion Papers . Special
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M. Brizova
c) The development of the tertiary sector, which concentrated with a higher
intensity in big cities and in conurbations, with a view to more favourable con-
ditions.
The share of this sector in the total employment rate within the national
economy increased from around 40% in 1990 to more than 50% in 1994 and it
keeps increasing. A very high share of employment is accounted for by the
capital, Prague (over 70% in the structure of its employment), Brno, Plzen and
further in the districts of Cheb, Ceske Budejovice, Karlovy Vary and others. On
the other hand, lower proportions are reached by districts with rural areas
(Plzeii-north, Chrudim, Nachod, Blansko, Zd'ar n.S. etc.).
d) The inequal development of private enterprises within the framework of
the Czech Republic, especially in terms of small and medium-sized enterprises.
Since 1990, small and medium-sized enterprises have belonged to dynami-
cally developing areas of the economy, and they have absorbed most of the
workers released from ineffective productions,
In terms of the number of businesses, the most favourable situation is rela-
tively in the capital, Prague, and in the adjoining Central Bohemian region, in
Western Bohemia (the districts of Plzeii, Karlovy Vary, Cheb), in the conurba-
tion in the districts of Liberec and Jablonec. The lowest level of small and me-
dium-sized enterprises persists in the Ostrava conurbation (the district of
Karvind reaches the worst proportions within the Czech Republic), in the coal-
basin districts of Northern Bohemia and in other districts of a predominantly
rural nature.
Further development of business activities in the above under dimensioned
areas is also influenced by a lower level of business infrastructure, the educa-
tion and qualification level of their population etc. which, together with per-
sisting environmental problems and the bad image of some areas (especially of
Northern Moravia and Northern Bohemia) discourage potential domestic and
foreign investors.
Besides the need for a general improvement of conditions for entrepreneurs
(the accessibility of capital, advisory, information and other services), it is nec-
essary to concentrate on strengthening the role of regional support for small and
medium-sized enterprises with stress on regions with economic problems.
e) Low inter-regional mobility of the workforce.
The migration of the population can become an important development fac-
tor, alongside with a decreasing level of the natural exchange of the population.
However, as this migration is linked strongly to the possibilities of housing
construction, the present unsatisfactory situation in housing construction makes
it practically impossible for the workforce to move to localities with job op-
portunities;
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
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Regional Policy in the Czech Republic
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Considering the limited possibilities of migration, there are certain changes
in its orientation as the formerly preferred industrial regions are losing their
attractiveness whereas the attractiveness of smaller locations in the vicinity of
big cities and districts with an advantageous position, e. g. in connection with
the permeability of state borders in the West Bohemian and South Bohemian
border regions with a favourable state of the environment, keeps increasing.
Workforce mobility is limited by the worsening transportation service se-
cured by means of mass personal transport, with bigger problems in districts
with low population density, extensive peripheral areas and thus larger dis-
tances between communities.
f) The persisting unsatisfactory state of the environment, especially in areas
with an unfavourable structure of the industrial base, with production highly
demanding in terms of power and materials.
This entails high air pollution due to power plants, thermal power plants, in-
dustrial plants, large-scale landscape destruction as a consequence of surface
and deep coal-mining, high production of solid household waste and especially
of industrial waste, high emissions damaging the agricultural land and forests
(the Krugne hory, the Krkonoge, the Jizerske hory, the Jeseniky, the Beskydy)
and the pollution of surface and underground water.
The markedly worst values in the individual aspects of the environment are
shown in areas of Northern Moravia, Northern Bohemia, the capital — Prague
and in some other territories (the Sokolov region, the Kladno region), with the
necessity of accelerated improvement with the aim of creating more favourable
conditions for the economic and social development of the respective areas;
some basic data on the state of the environment classified according to regions
within the sphere of activities of the individual territorial departments of the
Ministry of the Environment of the Czech Republic (including the capital, Pra-
gue) are given in tables in the appendix.
g) The existence of a number of area-technical specific features and prob-
lems, which have made the natural development of the respective areas more
difficult; these are especially.
Conflicts between organisations securing the mining of lignite and the local
authorities of the communities and the owners of property affected by mining in
the Sokolov region and in the North Bohemian Lignite Basin with a large extent
of devastated areas (extracted and unrecultivated areas, dumps, sludge deposit
areas) which limit the development of business activities here.
The consequences of coal-mining in the Ostrava and Karvind regions where
the destruction of the countryside, settlements and civil networks is caused by
the sagging of the ground due to deep coal-mining (with significant impacts
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
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M. Brizova
especially in the Karvind region where this sagging of the ground endangers
around 50% of the territory of the district).
Conflicts between interests of nature protection and the development of
communities and business activities (the necessity of maintaining the water
system, the landscape, the health, hygienic and other functions of the territory)
in large protected territories (especially in the national parks of the Sumava
mountains, the KrkonoKe mountains, the Dyje region), protected landscape
areas, protected areas with natural water accumulation, hygienic protection
zones.
Regional policy in the Czech Republic
The material "Draft principles of government regional policy" was prepared on
the basis of the plan of work of the government for the first half of 1998 and in
pursuance of the Programme declaration of the government of 27 January 1998
which states that the Government "attributes considerable significance to the
adoption of regional policy principles in accordance with the practice of EU
policy".
The execution of state administration in the sphere of "regional policy" is
not defined in our legal system in the form of a special act, it is only stated
(without any closer explanation) in the so-called Competences Act. For this
reason, the government must lay down the interpretation of the content of the
execution of state administration in the sphere of regional policy. The govern-
ment last discussed these issues in December 1992 when it adopted Resolution
No. 759 on principles of the regional economic policy of the government on the
basis of a proposal submitted by the Minister of Economy.
In accordance with these principles, regional policy measures in the Czech
Republic (co-ordinated by the former Ministry of Economy) mostly concen-
trated only on increased support for small and medium-sized enterprises in
what are called economic problem areas.
However, the regional policy defined in this way did not include the co-
ordination of activities of other sectors having significant regional impacts
(infrastructural and environmental investments, promotion of enterprise in
agriculture, public services etc.) and regional or local authorities were not much
involved in the solution of the problems. With the exception of support for
enterprises, no system of programmed support for problem areas was created.
The attitude of the state was characterized mostly by sectoral attitudes without
any mutual links and there was no integrated regional approach to the issues.
Such a conception of the regional policy is not in accordance with the amended
Competences Act No. 272/1996 Sb., which assigned to the Ministry for Local
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
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Regional Policy in the Czech Republic
39
Development a coordinating role in securing the regional policy of the state, in-
cluding the management of funds (Article 14, paragraph 2 of the Act).
The conception of the existing regional policy is not in accordance with re-
gional policy principles practiced in EU countries and by the EU, either. For
this reason, the European commission states in its opinion on the application of
the Czech Republic for membership in the European Union (July 1997) that:
— The Czech Republic has no regional policy;
— Initiatives aimed at regional development are implemented through sev-
eral national approaches while there is no independent regional develop-
ment policy;
— The Ministry for Local Development must prepare the corresponding co-
ordination mechanisms at the national level;
It will be necessary to create effective tools and to strengthen existing
funds earmarked for regional development;
— The Czech Republic is still waiting for the introduction of a legal, ad-
ministrative and budgetary framework of an integrated regional policy
and for ensuring that these rules are in accordance with those applied
within the EU.
Principles of the new political document on regional policy
For reasons enumerated above and on the basis of approaches to regional policy
in the countries of the European Union (Annex No. 1), analyses and trends in
the present-day regional development, including the evaluation of regional
policy measures adopted hitherto in the Czech Republic (Annexes No. 2 and
No. 3), it is proposed to the Government that it should express its consent with
the new regional policy principles (part III of the material, paragraph I of the
draft resolution of the Government) and subsequently abolish the existing prin-
ciples, adopted by Resolution No. 759/92 (paragraph IV of the draft resolution).
The aim of submitting the Principles of regional policy is to unify government
opinion on general rules governing the implementation of regional policy in the
Czech Republic, including the role of co-ordination between ministries and the
management of funds and to bring this part of state administration closer to the
practice in the EU.
This general orientation of the principles, which replaces temporarily the
missing legislation in this area and which does not include concrete solutions of
the regional issues in the Czech Republic, was confirmed by the Government
on 26 November 1997. Simultaneously, the Government expressed the opinion
(conclusion made by the former Prime Minister at the end of the discussion
concerning the material) that the adoption of brief principles would be followed
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
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M. Brizova
by the "green light" for subsequent work on the concepts, programmes and
legislation (paragraph 17 of the principles and paragraphs 11/1 and 11/2 of the
draft resolution of the Government) which will have to be secured still before
the year 2000, in connection with:
— The need to define material problems and the regional development strat-
egy within the framework of the Czech Republic;
— The preparation of accession by the Czech Republic to the EU (it will be
necessary to react to criticism voiced by the Commission);
— The linking of the regional policy of the centre, with the future compe-
tences of higher territorial administration units, in the sphere of co-
ordination of their territorial regions.
Compared with government principles of 1992 (Principles of the regional
economic policy of the Government), a broader approach is proposed, es-
pecially in relation to:
—The definition of the basic goal and the starting principles of regional
policy;
—The orientation of regional policy support to a wider range of measures
(not only to support enterprise);
—The role of programming in the regional policy;
—The integration of the regional level into the implementation of regional
policy;
—The co-ordination role and fund management at the level of the Ministry
for Local Development.
The regional policy is understood as a conceptual activity of the state, re-
gional and local authorities with the aim of contributing to the balanced and
harmonious development of the individual regions in the Czech Republic, re-
ducing the differences in the levels of development between the individual re-
gions and improving the regional economic structure. The efforts to achieve a
balanced development cannot be understood as an effort to secure completely
equal development in all regions, which is naturally impossible in a market
economy. The aim is only to maintain proportionate, no-crisis development in
the whole country as well as at the level of regions, to give equal chances to all
regions and to make full use of their demographic, natural, and economic and
any other potential.
This is how regional policy is understood in EU countries (e.g. the European
Charter of Regional Planning sees one of its aims in a balanced socio-economic
development of the regions, similarly the Finnish Act on the regional develop-
ment, the French Act on regional development or the German Act on improving
the regional economic structure). The European Union, for instance, sets the
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
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Regional Policy in the Czech Republic
41
aim of "improving the economic and social development, which is balanced and
sustainable, especially ... by strengthening the economic and social cohesion";
Article 130a of the Treaty on the European Community states that "to promote
its overall harmonious development, the Community aims especially at reduc-
ing the differences between the levels of development of various regions".
The principles proceed from the fact that the role of the government in the
development of regions can only be partial but still, that it should be precisely
defined. The decisive role must be played by the active involvement of regional
subjects active in the respective regions. However, regional local authorities
have not been created yet and they only come into being after 1 January 2000 in
accordance with Constitutional Act No. 347/12997 Sb. Therefore, it is now the
task of the government to prepare the whole set of laws necessary for the
forming and functioning of regional governments and to give them sufficiently
strong competences; at that, the principles formulate, in a general way, the tasks
of the future regional governments in the sphere of co-ordinating the develop-
ment of their territories. Simultaneously, the government must fulfil the basic
aim of regional policy formulated in the principles.
It is the aim of the principles that the regional policy in the Czech Republic
should respect the basic principles of regional structural policy of the European
Union (of the common EU policy in the sphere of economic and social cohe-
sion) and that it should create such mechanisms that will make it possible in the
future to receive support from structural funds of the EU. This includes espe-
cially the need to concentrate regional policy funds in problem regions and the
necessity of programming covering periods of several years and the strength-
ening of the conceptual approach in this sphere; in accordance with the EU,
special stress is laid on decentralization in decision-making and in adopting
responsibility (the complementarity principle) and on the co-operation between
various authorities in solving issues of regional development (the partnership
principle).
The definition of so-called structurally afflicted and economically weak re-
gions is necessary and attention has been paid to it to make the selection of
indices for defining these regions possibly similar to approaches used in the
EU. In accordance with this, the definition has been prepared especially on the
basis of criteria evaluating the economic level of the regions and the standard of
living of their inhabitants.
The draft principles provide for the support of other regions at the national
level if the government expresses its consent. At present, this entails especially
the cross-border co-operation programme (Phare CBC) to which the EU con-
tributes annually with an amount of K6 1.2 billion and which supports districts
bordering with Austria and Germany (the CREDO programme has also been
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
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M. Brizova
started — so far, with limited funds — to support cross-border co-operation with
Poland and Slovakia).
In the long range, this can entail especially support within the framework of
Aim No. 1 of the structural policy of the EU, which will have a pronounced
regional accent, on the basis of adopted programme documents, such as the
Regional operational programmes (ROP) or Single programming documents
(SOP) for the individual regions of NUTS II (territorial statistical units used
within the EU); these programmes will necessitate co financing from funds of
the Czech Republic (state budget, budgets of local authorities and regions).
Programming belongs to key principles of the regional policy of the EU as
support from structural funds is not linked to individual (isolated) projects, but
to indicative, multi-year and multi-sectoral programmes, which must substanti-
ate the need and orientation of the support. In accordance with this approach,
the principles propose a broader conception of the regional policy; this is based
on the fact that development at the regional level can be influenced by a num-
ber of factors (integrated conception of the regional policy in accordance with
the practice within the EU), especially in the sphere of support for the enter-
prise, the development of the infrastructure and the environment, in the sphere
of human resources (increasing employee skills) etc. Standard tools (subsidies,
loans, guarantees for loans) and sources can be then used generally to support
regional development, especially from the state budget, with majority partici-
pation of the investors (with the possible exception in the case of local commu-
nities and the future higher territorial administrative units).
It is proposed to prepare a new document within the framework of the re-
gional policy of the Czech Republic as the basic conceptional document — The
strategy of the regional development of the Czech Republic. The preparation of
this document will be the result of co-operation between sectors in accordance
with the co-ordinating role of the Ministry for Local Development. Similar
documents are being prepared in a number of European countries (e.g. Austria
within the framework of the institution called OROK which is chaired by the
Federal Chancellor, country programmes in Germany, so-called territorial de-
velopment schemes in France, the so-called Political document for regional
document in Holland, which is prepared for a four-year period and adopted by
the Parliament etc.).
The aim of the strategy will be primarily to analyse the regional develop-
ment in the Czech Republic, to evaluate attitudes of the state and of the regions,
to formulate the strengths and weaknesses of the possible future development
and to define the strategy of the development of the individual regions. Simul-
taneously, the document will contain proposed changes in the attitude of the
state to regions carried out within the responsibilities of the individual sectors
(if these are demonstrably needed), the specification of regions with concen-
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
Discussion Papers . Special
Regional Policy in the Czech Republic
43
trated state support and the enumeration of further tasks (in 1999, these will
include primarily the preparation of the state and the regions for the future
utilisation of structural funds). With a view to its nature, this will be a concep-
tional strategic document, which will not decide on the concrete allocations of
funds to the regions, to the concrete projects.
Regional development programmes will be prepared to support the devel-
opment of regions specified in advance; these will be in the nature of integrated
(multi-sectoral) programmes and their framework of support will proceed from
an analysis of the situation and from the defined development strategy of the
region. It can be expected that the preparation of these documents will be of
key importance especially after the formation of regional self-governments and
after our accession to the EU. From the viewpoint of our future joining the EU,
it is desirable to start right now with the preparation of these programmes in
accordance with the methodology required within the framework of the respec-
tive regulations of the EU Council on structural funds.
At present, the Ministry for Local Development proceeds from the fact that
state assistance is needed primarily in structurally afflicted regions where the
level of unemployment is increasing significantly; for this reason, it will pre-
pare for the government a draft regional development programme for North-
West Bohemia in co-operation especially with regional authorities, with the
Ministry of Labour and Social Affairs, the Ministry of Industry and Trade, the
Ministry of the Environment in the first half of 1998. It will try especially to
utilize the experience of Western countries with the conversion of similar re-
gions
The principles proceed from the fact that the competences of the state in the
issue of regional policy are entrusted to the Ministry for Local Development
and the support for the individual regions within the framework of the regional
policy system can be implemented exclusively on the basis of integrated re-
gional development programmes. Besides this policy, nation-wide sectoral ap-
proaches and programmes will continue to be implemented within the frame-
work of the individual sectors, as it has been up till now; these naturally have
regional impacts as the final use of funds is always connected with a concrete.
The respective sectors are responsible for the implementation of sectoral pro-
grammes, including the provision and management of the respective funds. It
will always be a matter for the government to decide whether the support of the
regions will be implemented exclusively within the individual sectors (and thus
outside the regional policy system) or in the form of an integrated approach
(within the framework of the regional policy system).
From the viewpoint of the institutional framework, it will be necessary to
implement the regional policy and the regional development policy in the
Czech Republic at two levels, at the national level and at the regional level
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
Discussion Papers . Special
44
M. Brizova
which, however, does not exist at present and whose role is substituted by the
centre on the one hand and by the district and local authorities on the other
hand. The necessary institutional level for a successful regional policy is the
forming of higher territorial administrative units with competences and eco-
nomic tools enabling them to take over responsibility for their territorial devel-
opment. The Parliament of the Czech Republic adopted the constitutional Act
on the forming of higher territorial administrative units by its both chambers at
the end of 1997; the government adopted the time schedule for the implemen-
tation of further work within the framework of its resolution No. 490/97.
The competences of the state and, especially, of the Ministry for Local De-
velopment have already formulated in relation to the envisaged competences of
the higher territorial administrative units in the area of regional development.
They proceed from the fact that these will be new independent competences not
transferred from the centre and thus qualitatively different activities from those
that form the content of regional policy at present. These competences will
bridge over the current non-existence of an independent regional development
policy in the Czech Republic. However, higher territorial administrative units
will probably also take over competences relating to the administration of se-
lected assets (these can include e.g. roads, cultural, school, social and health
facilities) and some competences in the sphere of territorial planning; this de-
centralization will substantially increase the ability of higher territorial admin-
istrative units to co-ordinate the development of their regions in the simultane-
ous co-operation with the centre in securing this task.
The activities of the authorities of higher territorial administrative units are
connected with the necessity to build organisation structures capable of taking
care of the implementation of various regional activities (programming, infor-
matics, regional promotion of enterprise, the development of tourism etc.), in-
cluding the ability to implement EU assistance programmes and to accept as-
sistance from the structural funds of the EU. In a number of countries with
market economies, these roles are fulfilled by regional development agencies; a
typical example is the United Kingdom where these organisations set up by the
state have fulfilled important tasks connected with the conversion of industrial
regions or with the development of rural regions for almost twenty years; there
are, e.g., two agencies in Scotland set up by the state on the basis of a special
law, with significant financial support from the state (over 500 million pounds
per year) and with a staff of more than 1,500 people. The forming of the first
agencies in the Czech Republic has been supported from the Phare funds (Os-
trava, Most, Liberec, Sumava) but the state has practically not participated fi-
nancially in the financing of development programmes prepared by these or-
ganisations. At present, it is necessary to consider the extension of the network
of agencies in the Czech Republic with the help of the state (the Ministry for
Michaela Brizova : Regional Policy in the Czech Republic. In: Role of the Regions in the Enlarging
European Union. Pécs, Centre for Regional Studies, 2001. 32-45. p.
Discussion Papers . Special
Regional Policy in the Czech Republic
45
Local Development) and the partial financing of development projects, which
these agencies implement. It is envisaged that the development of these bodies
should be mainly the responsibility of regional government bodies.
In connection with the Act No. 272/96 Sb., the principles also define the
extent of cross-sectoral co-ordination which includes co-operation in the
preparation and implementation of programme documents of regional policy
compared to the original version of the principles, the co-ordination of sectoral
conceptions and programmes has been left out. In accordance with this
provision, the principles proceed from the fact that the Ministry for Local
Development will manage, at the general level, funds allocated for regional
multi-sectoral development programmes for specified regions, including
regional programmes to support enterprise and funds from regional
programmes co-financed by the EU (at present, this includes especially the
cross-border co-operation programme Phare).
The principles form the basic framework for the implementation of the re-
gional policy in the Czech Republic. It is proposed to solve the legislative
regulation of the above issues within the framework of the new bill on the pro-
motion of regional development (Finland has a similar law; from among coun-
tries aiming to join the EU, Hungary has a law like that, Rumania and Poland
are preparing it). In accordance with the standpoint of the European Commis-
sion it is proposed to prepare a draft material intent for the bill on the promo-
tion of regional development.
The new law will be prepared in relation to the competences of the higher
territorial administrative units (the Ministry of the Interior of the Czech Repub-
lic) and other legislation. We view the preparation of this law as a key issue for
the further functioning of the regional policy in the Czech Republic as state
administration in a democratic country must be exercised on the basis of legis-
lation; besides, it will be possible to give higher territorial administrative units
powers within the framework of the law (not e.g. by a government resolution as
it is usual currently in the case of district authorities).
References
Bla2ek, J. 1996: Nove institucionalni ramce ekonomiky a regionalni rozvoj. — Hampl,
M. et al. Geograficka organizace spoleMosti a tranformani procesy v &ski re-
publice. Praha, pp. 303-314.
Hampl, M. et al. 1999: Geography of Societal Transformation in the Czeh Republic.
Prague, Charles University of Prague.
Hampl, M.—Muller, J. 1998: Isou obce v Ceske republice ptilig male. — Geografic. 103.
pp. 1-12.
Raj
M. 1997: Navoh koncepcie gtatnej regionalnej politiky — vychodiska a ciele. —
Aktwilne problemy regioncilneho rozvoja. Banska Bystrica. pp. 7-13.