The bad news keeps coming from the Euro zone today as the crisis threatens to claim another political victim in the form of Czech Republic Prime Minister Petr Necas and his government. Calls for a vote of no confidence have been made after claims of corruption and the extent of the country’s austerity plans.
“In case the government doesn’t pass the confidence motion, my Civic Democratic Party will announce its resignation in parliament by May 3rd at the latest, so that elections can be organised by the end of June,” said Necas after a meeting with party officials on Monday. The prime minister is said to be confident that his government will achieve the votes necessary to cling onto power.
The government’s plan to hike up taxes and to cut more services has enraged the Czech population. On Saturday more than 90,000 people marched in protest against the austerity plans, making it the biggest protest since the revolt that ended communism in 1989.
The political instability in the Czech Republic comes after yesterday’s fall of the Dutch government. A disagreement between the Dutch Prime Minister Mark Rutte and the leader of his coalition partner Geert Wilders of the Freedom party over the country’s Austerity plans caused Rutte to officially offer his cabinet’s resignation to Queen Beatrix.
If Necas falls he will join an ever increasing list of politicians forced out of office.
The ongoing Euro crisis has already claimed the leaders of Greece, Italy, Spain, Portugal, Latvia, Slovakia, Slovenia, Finland, Romania and now the Netherlands. French president Nicolas Sarkozy could be the next victim after recent polls suggest that he is flagging behind his election rival Francois Hollande.
Whilst governments continue to topple due to the strict austerity measures imposed by the IMF and EU increases the chances of political leaders turning around and saying no the plans.
Elsewhere in Europe, today’s Dutch bond auction went smoothly with the treasury selling off €1.995billion of bonds which was in the middle of its target of €2.5billion. Spain suffered a fresh blow as it saw its borrowing costs almost double. It managed to sell €725million of its three month bills and €1.25billion of its six month bills.
In the UK the latest public finance figures for March were released showing that the UK had borrowed £18billion, more than it had expected. However the country managed to meet its target for 2011. The countrys debt rose to £1.02 trillion in March, equivalent to 66% of GDP, the highest since records began in 1993.
The Pound to Euro exchange rate is currently trading at 1.227
The Pound to US Dollar exchange rate is currently trading at 1.615
The Euro to US Dollar exchange rate is currently trading at 1.316