Czechia is usually seen as one of the success stories of the transformation from Communism but even here there are black spots, and none blacker than the city of Most in northern Bohemia. 

The Ustecky (Usti) region where Most is located and the neighbouring Karlovarsky (Carlsbad) region to the west sit firmly at the bottom of the 14 Czech regions in terms of GDP per capita, with CZK359,000 (€14,255) and CZK324,000 respectively. By comparison, GDP per capita in the Prague region is three times higher at CZK1.06mn, according to 2018 figures. 

Over the past 20 years the two regions have fallen back in relative terms. In 2000, Ustecky ranked 10th (three places higher) and Karlovarsky 9th (five places higher), points out Radek Habl, the country’s leading expert on personal indebtedness, which he says has played a big part in the impoverishment of local people in the two regions. 

Most, located in picturesque hills along the border with the German federal state of Saxony, is notorious as a socially deprived area with the third highest unemployment rate in the country (7.2%, compared to 3.7% at the national level in 2023), and racial tensions focussed on the minority Roma community.

It has become in many senses a case study of the region’s problems and the country’s struggles to deal with them over the past 35 years since the collapse of communism.  

Most is also now at the frontline of the EU’s push to transition away from coal and towards sustainable energy. North Bohemia in the north-west of Czechia, as well as the Moravian-Silesian region in the north-east of the country, together with neighbouring parts of south-eastern Germany and south-western Poland, are part of Europe’s most extensive coal mining region – dubbed the “black triangle” or the “lignite triangle” – which was once at the centre of the then Eastern Bloc’s heavy industry.  

This industry is now being drastically wound down as part of the shift to a carbon-free future, but there are hopes that the region could also benefit from this transition.

Sad history

Most itself has its own specific problems deriving from its sad history. The city of some 64,000 has come to epitomise the dark side of Czech modern history, says Michal Zablocki, former correspondent of the Polish news agency PAP in Czechia and currently a campaigner at Europe Beyond Fossil Fuels.  

Zablocki highlights Most’s tragic history, including the post-World War II expulsion of the region’s ethnic German population, and the destruction of old Most by the Communists 60 years ago to be able to dig out more coal deposits. 

Among the few buildings that were saved was the late gothic Church of the Assumption of the Virgin Mary, which became the “heaviest object in the world ever moved on rail” when it was transported almost one kilometre away from its original location to the new city of Most.  

The city’s woes continued after the end of Communism as one of the worst examples of the 1990s “wild privatisation” era of frauds. 

“What wasn’t destroyed and survived both [20th century] totalitarian regimes was finished off by the first years of capitalism and the wild privatisation of the 1990s,” says Zablocki.

Managers at Mostecka uhelna splecnost (Most coal and mining company, or MUS), the city’s main employer, grabbed secret ownership of the company using its own funds. Among the country’s largely never investigated wild privatisation-era scandals, it has the distinction of being the highest-profile case in which prison sentences were handed down for the frauds. 

After a succession of owners, some of the assets once controlled by MUS were later put together under the Sev.En coal empire of controversial Czech coal billionaire Pavel Tykac.

The local coal industry’s saga of murky ownership and frauds was not conducive to good management.  In a recent interview for the Czech online magazine Alarm, British economist Martin Myant said that the “people who gained MUS in privatisation did not bother to develop the company further. They merely wanted to make money and sell the company to someone else, who made money in a similar manner.”

Textbook example of failed transformation

What happened in the Most region after the fall of communism is “a textbook example of failed transformation”, says Tomas Tozicka, a theologian and community worker in the Most area.

Tozicka says that the problems in the Most region are “a legacy of the 1990s” and already by the mid-1990s “it was clear there would be trouble”.  However, he says the transformation in the Most region did not have to happen in the way it did.

“The Ruhr region managed to do it,” Tozicka points out, referring to the way the industrial German federal state of North Rhine-Westphalia transformed itself into a knowledge-based economy over several decades.   

“The state could have kept shares” in the privatised mines to ensure a gradual wind-down while new alternative sectors were developed. “Cities had shares, but they did not cooperate” with each other, Tozicka says, enabling asset strippers to grab the mines and loot the businesses, without regard for the workers or communities.

Tozicka says “the main narrative of the 1990s” in Czechia was that “everyone is alone responsible” for the situation in which they find themselves. The neoliberal “hands off” orthodoxy of the 1990s was only junked during Vladimir Spidla’s Social Democrat administration of 2002-4, when the first national policies addressing regional unemployment were introduced. Since then EU-funded programmes aimed at improving social inclusion have also been introduced.

However,  the mining industry has continued to shrink. This May the CSA mine, part of the Sev.En group, announced it would lay off 485 workers and close down completely next year. The whole mine should eventually be turned into a lake even bigger than the one at the site of old Most, which opened in 2020 after a 12-year-long recultivation programme.  

Finding a use for the region’s redundant workers is likely to be less easy.  Unemployment has remained an issue in Most even as Czechia began to boast one of the lowest unemployment rates in the EU. In June Most once again came to top the Czech districts with the highest unemployment rate after it went up to 8.4%. The local labour office’s July figures show that only about one-quarter of the laid-off CSA employees found new jobs. 

“There was no follow-up industry” in Most, Tozicka says, adding that local companies just brought in temporary workers to fill gaps after the mass lay-offs in the 1990s. 

Housing speculation amid ghettos

Tozicka says another issue from the 1990s that affects the region today is the privatisation of the apartment blocs built in the new Most in the post-WWII decades, which has led to a shortage of affordable housing.

Housing prices and rents have soared across the country, but they are a particular problem in areas such as Most where incomes are dramatically lower than the national average. Moreover, partly because of housing speculation, the rise in the cost of family houses in the Usti region has been the highest in the country, with 289% growth between 2015 and 2022, compared to a national average of 244%. 

Ester Klimecka, who works as an editor at Alarm, blames privatisation for making housing an object of speculation.

“I wish the massive wild privatisation of apartments could be taken back as this would help Most immensely,” Klimecka says, highlighting how many apartments are now in the hands of speculators who don’t live there and just want to make money on the situation in the housing market. 

Besides housing, Klimecka also points to the crisis in education as among the most pressing issues in the Most region.

About 20% of the population in the Most region only has elementary and middle school education, while the national average in 2023 was 12.2%. Less than 10% of the Most population has a college-level education, while nationwide it is 21.9%. 

A large part of the problem here is the “massive segregation in education”, with Roma ghettos representing another serious challenge, “which should not be the case in the 21st century”, Klimecka says. 

Roma suffer the worst from most of the region’s problems in education, jobs and housing. Most’s Chanov quarter has become one of the symbols of the ghettoisation of the Roma population, and a trope for populist politicians.

The region’s segregation problems was one of the leitmotifs of one of the most popular television series in recent years, Most!, a sitcom set in the city featuring outcast characters coping with alcoholism, racism, joblessness, sexual minority issues and blackmail, in a fast flow of events and gags, some of which have since become catchphrases. 

“Formerly a source of pride in socialist modernism, [Most] today is a microcosm of the greatest Czech problems and a place avoided by politicians, investors and everybody else,” literary commentator Jan Belicek wrote in his review of Most!, noting, however, that the TV series also  “helps to create a mistaken impression that the “nice Czech” racism is “not really threatening Roma”.

Making money out of misery

Making this all worse is the draconic system of foreclosures, which sides with creditors and gives bailiffs extensive powers, creating a business segment based on making money out of the misery of debtors’ poverty. 

Habl points out that about “one quarter of people of productive age are dealing with foreclosures”. He highlights that the situation takes an especially hard toll on children whose parents face multiple foreclosures and who are often forced to live with relatives or in hostels as a result.      

Ustecky is the country’s worst-hit region by foreclosures, with a 14% share of the persons in foreclosures in the overall population, followed by the neighbouring Karolovarsky region with 13%. 

The rules “force many into [untaxed] grey zone jobs” or to work in Germany to avoid bailiffs and debt collecting companies, Habl says.  

Habl says that the situation won’t change without deep reform of the foreclosure legislation. This is something that has been hampered up till now by neo-liberal ideology and vested interests, though some changes have been made through recent legislative amendments. 

Perhaps unsurprisingly, Most and its surroundings are now a stronghold for the populist ANO party of billionaire Andrej Babis. The far-right anti-EU SPD party of Tomio Okamura, another politician preying on misery and promising easy solutions,  also does well in Most. 

In the 2021 national elections, ANO won in Most by a mile with 39% of the vote ahead of the governing centre-right SPOLU list with 17%, followed by the SPD with 13%. The election turnout was 52%, considerably below the national average of 65.4%. 

Just transition?

The EU’s Just Transition Fund could offer a possible way out for marginalised areas such as Most.  Zablocki highlights that Czechia will receive €1.58bn from the EU’s fund, “which is not little if this money is redistributed to the regions dependent on coal” – Usti, Carlsbad and Moravian-Silesia – and used for projects focused on work and social issues such as skills development and requalification. 

However, from the CZK15.7bn for the Ustecky region from the fund (for comparison, the city of Most has an annual budget of CZK2bn), about CZK7bn will go to large recipients such as energy companies Sev.En Group, CEZ, and also the regional university UJEP, Klimecka said. 

“These of course include money for projects in research and development, including lithium batteries, but the original idea was to develop small and medium-sized enterprises, and not that half of this money will go to the large recipients,” Klimecka explains.

She added that Czechia as a country was not adequately prepared and came under time pressure to come up with projects for the JTF, which “came in handy for large entities with informal ties” to policymakers. 

Lithium, used in electric vehicle batteries, has also been talked of as a potential saviour for the region. The nearby Krusne Hory (Ore mountains), which form a natural border between Czechia and Germany, contain some of Europe’s largest lithium deposits. 

The majority state-owned energy utility CEZ has a 51% stake in the joint lithium project at Cinovec with Australia’s EMS, though production is still some years off.

Yet even when the lithium mines and associated industries finally get off the ground, locals remain sceptical that Most and the Usti region will be the ones to benefit, – given the region’s depressing history of poverty and environmental damage. 

“It should have been clear since 1992 already that coal mining and heavy industry regions [in then Czechoslovakia] will require transformation,” Tozicka says, adding that “if early measures were adopted things could have been different”.