Fiscal Policy in the Czech Republic under Transition

Introduction

The Czechoslovak economic transformation (which then included the Czech Republic) started in 1991. Nevertheless, 1990 was also an important year. A short history of the phases in the transformation process in the period from 1990 to 1994 is as follows.

The preparatory work on the Czechoslovak and then Czech reform strategy started in 1990. In this year, the economic strategy of the government consisted of preparing the best possible starting macroeconomic conditions for the implementation of the following liberalization reform steps.

In terms of macroeconomic and microeconomic management, the Central Plan as a management instrument was abolished at the beginning of 1990.

The main vehicle of macroeconomic policy was a restrictive fiscal policy which was aimed at eliminating at least a part of the existing macroeconomic imbalance.