ABSTRACT
The Czech Republic, under the go-ahead but pragmatic leadership of prime minister Vaclav Klaus, for a while overtook Hungary as the number one economic and political success story in Eastern Europe. (On 28 November 1995 the Czech Republic became the first former communist country to become a member of the OECD.) Despite the later tarnishing of his reputation for political and economic management (e.g. financial scandals and a poor record in industrial restructuring), Klaus achieved a generally rapid economic transition while using subsidies to avoid sudden large-scale bankruptcies and lay-offs. Klaus also did a good job of ‘selling’ a consistent policy line to the Czech public. He has made something of a political comeback at a time when the reputation of his arch rival President Vaclav Havel (who has been in poor health) has been damaged somewhat at home by events such as his second marriage.
