The GPM Global Forecast is a bi-weekly, members-only article series for 2018. It provides analysis and short-term forecasting on key military, political, and economic events around the globe. 

A political overhaul in the Czech Republic?

Sweeping changes are happening at the highest levels of Czech politics. Prime Minister Andrej Babiš has agreed to step down after his minority government lost a confidence vote earlier this week. Babiš, a political neophyte anti-establishment billionaire who was just eight months into his first mandate, fell from grace after allegations that he had previously hid ownership of one of his companies in order to qualify for €2 million worth of EU subsidies meant for small businesses. President Miloš Zeman has said that he will give Babiš a chance to form a new government, but the process will be arduous and unlikely to produce a result as opposition politicians jump from the sinking ship. Some parties have expressed a willingness to enter talks so long as Babiš is not the prime minister.

Coalition talks could be impacted by the ongoing presidential election pitting sitting president Milos Zeman against Jiri Dragos, an academic and self-styled bulwark against the populist tide sweeping Eastern Europe. In the first round, Zeman came out ahead with 38.6% of the vote to Dragos’ 26.6%. However, much of the remaining field have declared their support for Dragos, and pollsters are predicting a much closer result in the second round of voting scheduled for January 26-27.