ABSTRACT

In June 1991, the Czech Minister of Industry and Trade, Jan Vrba, announced at the London headquarters of the republic’s privatization advisers, Bankers Trust International, that more than fifty leading Czech companies were available for sale to foreign investors. The London announcement followed several joint venture deals involving foreigners – most notably a $6 billion deal between car-maker Sˇkoda and German motor group Volkswagen. ‘We are only interested in long-term investors,’ Vrba said at a news conference. ‘It’s not only money we are seeking, but markets and modern management. So we seek partners for the rest of our lives, not just for one night.’1 There were a number of foreign ‘partners’ ready to bid for the commanding heights of the Czech economy. For instance, Mercedes signed letters of intent to take stakes in two major truck companies, Avia Praha and Liaz, in March 1992.2 Yet, very unexpectedly, foreign capital was sent home with very few Czech presents in its pockets. In the end, foreign participation was more the exception than a rule in privatization outcomes. Mercedes, for instance, withdrew from both Avia and Liaz. The investors were turned down. Czech state strategy in the early nineties, as discussed in the previous chapter, was quite hostile to foreign capital. It aimed at promoting national accumulation and creating a national bourgeoisie. Why did the internally oriented project become dominant at the beginning of the early nineties? What constituted its political, institutional, and ideational support?