Final Word from Friday, May 7, 2004
The Czech state is going to have to pay Kč 2bn to Petrcíle to settle the arbitration dispute regarding Nová Huť steelworks and up to Kč 1bn to get Boeing to leave Aero. Both payments could have been avoided if the state were willing to let dead companies die or be reorganized. However, blindly saving jobs has been the priority. The state hasn't been willing to use the threat of bankruptcy, and this has strengthened the positions of Petrcíle and Boeing. It's too late in the case of Petrcíle, but something can still be done at Aero. Boeing has acknowledged that Aero has a negative net worth, and Aero's own president claims that Boeing is the one driving it into the ground. Instead of paying Boeing to leave, the state should present Boeing with an invoice for its share of the mess. This might not be contractually enforceable, but it'd put the matter in the right perspective. Vodochody