Mr Havel
I have met for the second time with the Prime Minister. The first time was during my visit to the UK last March; today we spoke about similar subjects but more specifically now. We met at the lunch and then the two delegations met.
We explained each other's opinion on various subjects, we spoke about the future of Europe and the future situation of Czechoslovakia in Europe as well as the existing European institutions and structures, those that are promising, those that should be transformed in some ways and those that have proved meaningful as well as those that are left-overs of the past, losing the reason to be, as well as those that are about to originate.
I hailed the attitude the Prime Minister explained in her lecture at Aspen where she recommended the European Community to open magnanimously to the countries of central and Eastern Europe. I informed her about our interest in an Association Agreement with the European Communities and the Prime Minister was greatly interested in the domestic political situation in our country, as well as our economic reform, the process of privatisation. [end p1]
She explained some of her views. For example, she emphasised the great importance of economic legislation and the fact that we should not postpone this legislation very much as it is important for the businessman to know the rules of the game, to know about their rights and their duties. She informed us about some experience from privatisation in the UK.
We agreed on our standpoint to the Iraqi aggression in the Middle East. I underlined that the Czechoslovak standpoint is as energetic as that of Great Britain.
We also referred to other fields of our bilateral relations—the British Council and the fact that we are going to support the idea that the BBC, ending the respective legislation, should be given some frequencies in our country. We also spoke about cultural, intellectual and educational contacts and I thanked the Prime Minister for her support of the Know-How Project which is of very great importance to us as it helps our people to learn to think and behave economically, it is a programme that trains managers.
I mentioned the recent English/Czechoslovak Conference on Privatisation which has taken place in this country as part of this programme, it has been a very friendly exchange of views and standpoints and it does not seem to me that there was anything in these views that should be controversial.
It did not seem to me that we displayed any substantial difference of opinion. So much for my brief introductory information! The Prime Minister will certainly gladly answer your more specific questions. After all, her stay in Prague has not come to an end yet. She has quite a dense programme ahead and tomorrow she will present a substantial speech in our Federal Assembly where probably she will again summarise her views of the political [end p2] situation and development in Europe, today and in the future.
I should probably also emphasise that the Prime Minister's idea, which she also expressed in her Aspen speech, that is that a kind of Magna Carta of rights and duties of European citizens, should be drafted as a certain starting point for future co-existence of free peoples and nations in Europe. This idea is meeting with great support and agreement in our country. All that is directed towards the implementation of the lofty ideas of free and democratic Europe is hailed by the Czechoslovak Party because we believe that it is only in this kind of Europe that we can find an honest place for ourselves. [end p3]
Prime Minister
Vaclav HavelMr President, Ladies and Gentlemen. If I may add briefly to what the President has said.
I have long wanted to visit Czechoslovakia and in particular this historic city of Prague and it is especially appropriate that I do so when the whole country has enjoyed the rebirth of liberty. I am so very much aware that this has had a great deal to do with President Havel, with the efforts which he and other brave souls made during the years of oppression, always to say what they believed, and I am afraid they have suffered for it, but they have lived to see the joys of what they believed come true.
At home, we think that President Havel 's inauguration speech and his speech to the United States Congress in particular were two of the masterpieces in the history of liberty. He had a tremendous reception when he came to the United Kingdom, we welcomed him gladly and I also would like to thank the people of Prague who have given me such a welcome here in return.
It is particularly fitting, too, that I come at a time when we are just celebrating in Britain the fiftieth anniversary of the Battle of Britain in which Czech pilots and airmen fought alongside ours and helped us to win that battle so that we were able to go on for long enough eventually to see the United States join us and the rest of Europe and fight that war to victory.
Now the President has given a most excellent account of our talks. May I just add one or two things. With regard to the development of Czechoslovakia's economy and democracy, we shall do everything possible we can to help. The President mentioned the Know-How Fund, we are anxious to have as many contacts as possible [end p4] between businessmen, between cultural organisations, between school children.
And also I am very happy to announce today that there will be, from 1st October, no visas necessary for citizens of Czechoslovakia to come to Britain. I hope that will help them to come to our country more quickly and perhaps more of them to come.
With regard to the new European Community, you know the view that I have always taken is that this is not an exclusive club but should be an outward looking organisation. It should always be prepared, in Association Agreements with countries of Eastern Europe, to hold out the possibility of full membership the moment these countries, including Czechoslovakia, have got in place the full structure of political and economic liberty. That would be very much in keeping with the history of the wider Europe because of course the word Europe goes much wider than the Community. And we look forward to the day when we can welcome the newly-free countries of Eastern Europe, in particular Czechoslovakia, to be a member of the European Community.
We discussed defence and security. They have always been very appropriate. I think our staunchness in defence of what we believed was part of the reason which eventually led the leadership of the Soviet Union to take a different course of action and set their steps on the road to democracy. It is important that we retain our security now, particularly as we have to do out-of-area duties as well as the defence of Europe itself.
We spoke of the future role of CSCE. In my view it has a very important role. I look at it this way. The European Community, and perhaps an enlarged one, is the centre of our economic policy. NATO, the North Atlantic Treaty Organisation, [end p5] including both Europe and Canada and the United States, is the heart of our defence policy and the defence of the free world, and some of us from NATO are prepared to go out-of-area in order to do other defensive duties, I will speak about that in a moment. But the CSCE, it began with the Helsinki Accords, which thirty-five of us signed, is the only forum in which the United States, Europe and the Soviet Union joins in discussion. I think it will be beneficial for us all if we meet regularly, if our Foreign Ministers meet regularly, say twice a year, so they know one another, they know the thinking and they shape the way in which we can go ahead into the future century.
Because this has been a very turbulent century, a century in which the forces of oppression have, I believe, now been overcome and we wish to go ahead in a more peaceful way but always having the means to defend ourselves against any possible attack in the coming century. And the main organisation which I think can shape that future is the CSCE and we in Britain would be very happy if Prague were the seat of one of the CSCE institutions.
And the last point, which the President pointed out and of course we had a few words about, is the situation in the Gulf and of course we agreed that the United Nations resolutions must in fact be fully upheld. So there is no difference between us on that and I understand that Czechoslovakia is helping with some field hospitals and such things, which for a country which has done so much for liberty, is absolutely in keeping with everything which she believes and she backs up her words with actions. [end p6]
Question (Czechoslovak TV)
Two questions: the first one is the European Confederation which is the suggestion of President Mitterrand which he proposed on his last visit to Czechoslovakia, is in some controversy for participation with the European Community, what in your opinion will this mean for the countries like Czechoslovakia and the similar socialist countries if the way for them to participate in this communication will be easier than to the European Community; and secondly I would like to ask you in connection with the French delegation, on President Mitterrand 's delegation there were a lot of entrepreneurs and members of various businesses, you have no such presence in your delegation, does this mean that Britain is not prepared yet to invest in our economy?
Prime Minister
First, President Mitterrand suggested something called a Confederation of Europe. I am never quite certain what the words mean, I doubt very much whether they mean anything very different from what I have proposed in a more specific way. My proposal was that the countries of Eastern Europe, newly free, when they have the structure of liberty should have the right to apply to the European Community for full membership, that enlarges the present Europe to the wider Europe. I also believe that the countries of EFTA, the European Free Trade Area, one of those has already applied to join the Community and others may consider it.
Both of these consist of an enlarged Europe, I think possibly a Europe that would not have as many regulations as some countries [end p7] would wish it to have, and I think that if we have fewer regulations it would be better. But the point is not to have the present Twelve as a kind of exclusive club, but to enlarge it to include far more democracies so that we may be the more influential in our commercial dealings with the rest of the world.
In the meantime, the Council of Europe which consists of seventeen members, I believe it is possible for Czechoslovakia and Hungary to join long before they have fully achieved their economic structure of liberty, and I think it would be very beneficial both for the members of the Council of Europe and for the countries of Eastern Europe to join, because again it means a forum where we have more discussion together.
We came over on our plane this time not with entrepreneurs, they have been over before and will be over again. I did bring the press, I hope you do not think that was a mistake! I think we brought thirty members of the press, I think that was quite a good thing to do and I hope they are enjoying it.
Question
(Inaudible)
Mr Havel
The Prime Minister and myself, we have agreed in our opinions about the aggression, so the only difference between England and Czechoslovakia is that we cannot send our navy or a fleet of ships because we have not got one. But we are of course trying to look at some other possibilities, how to save the evil which is embodied by the aggressive regime of President Hussein. [end p8]
Prime Minister
The Vaclav HavelPresident has indicated that we both firmly uphold the United Nations resolutions, namely that Iraq must leave Kuwait completely and that the legitimate government of Kuwait must be restored. That is wholly in keeping with United Nations resolutions.
With regard to the other point which Michael Brunson mentioned, there has I think been a statement from the Douglas HurdForeign Secretary this afternoon. Have you got that statement? Are you sure that it has been made because I do not want to bounce it. Mr Reynolds you are sure it has been made?
Mr Reynolds
(Inaudible)
Prime Minister
Then you will know what it is. It is very unusual, the press usually know things before I do.
Mr Reynolds
(Inaudible)
Prime Minister
Well, that could be good guess work. But I think that what you have heard is that we are expelling form London the Iraqi Military Attaché and his staff, that is four people altogether.
Question
(Inaudible) [end p9]
Prime Minister
In order to support France and the other countries, some of their Residences were attacked by Iraqi troops in Kuwait.
Question
Do you think that the news democracies—Poland, Hungary and Czechoslovakia—will enter the new Europe easier if they combine and coordinate their efforts or would you prefer to tackle each of us separately?
Prime Minister
I think it is not a question of tackling each of you separately, it is a question of when you will be ready. The whole structure of the European Community is the structure of economic freedom and that is what all the rules and regulations are about. And also it has to be fair competition between the industries in the Community. So the question is: when will you be ready? I think that will require quite major changes in your legal system, which takes a good deal of time, as well as getting enterprise and the spirit of enterprise working fully and of course private property and the law of contract and so on. That I think will take quite a time.
I wish you well and hope that it will come along as quickly as possible. But do not forget that you have embarked upon a task of enormous magnitude. I do not think it has ever been attempted, indeed it has not, to go from a totally oppressive system where the diktat of the state was everything, where there was no independent judiciary or law to which people can go to get their grievances redressed, there was no structure of company law, of contract law, [end p10] no structure of banks as we understand it. You have to get all that in place, it is there from other countries to learn how to do it, but you know it does take a time to get used to these different habits and customs.
I am sure you will do it as quickly as possible and of course it does mean that by far the greater part of your industry will have to be privatised so that we have fair competition. I am sure you will go about it with a will, I am sure that Czechoslovakia probably has a better chance than some other countries because there will be people here who remember and who know what it was like before communism came. So it really depends, I think, upon you when you will be ready to apply.
Question
Can I ask you both whether you think Czechoslovakia should take similar action to Britain and kick out some Iraqi diplomats; and President Havel, how confident are you that you will get Soviet troops out of Czechoslovakia peacefully and on time?
Mr Havel
As for the first question, right now I cannot give you an answer because it does not depend only on me, but it seems that the situation in fact is evolving in that direction.
For your second question, I think that the Soviet troops are leaving without having to be forced, so we made all the contacts in time, we adopted a schedule of departure and except for some local disputes about the damages they have done or about paying for certain buildings or land, the other things, I think, there are no problems in the timetable, the timetable has been observed by the [end p11] Soviet party.
Question
In several countries in Eastern Europe, the economic situation is deteriorating rapidly, in some of them, not in Czechoslovakia, but in a majority of East European countries there is a very real threat of social and political unrest. Would you under any circumstances consider a partial cancellation of the debts notably of Poland and Yugoslavia, a majority of which were led by governments and not by private banks?
Prime Minister
I think there is bound to be difficulty in going from a totally centrally-controlled economy where there is no discretion whatsoever on the part of management of factories to a free society in which each enterprise is free-standing and makes its own decisions under the structure of company law.
Quite apart from the company law structure, which is a big enough problem on its own, it takes quite some time for people to train to make their own decisions and take responsibility for them and for people who work for that enterprise to take a totally different attitude from that which they have taken when it was in the hands of the state. Also you will find that frequently they employed far too many people for an enterprise to be efficient and again it takes time to get them re-employed elsewhere and training. So there are bound to be a good many problems changing over from the one to the other.
Now when it comes to debt, we do our rescheduling or any alterations that we make in that, as you know, through the Paris [end p12] Club so we would have to do it together. We do look from time to time at the position and no doubt will be looking at it again.
Question
Prime Minister, during the Falklands war your firm and relentless attitude was a great success. Today Great Britain and the United States are again the first strength of those who are against Saddam Hussein 's aggression. I am interested in your opinion concerning this aggression, especially in the light of recent events, for instance what happened at the Embassies in Kuwait, a political solution seems less probable now.
Prime Minister
It is perfectly clear, aggression must not be allowed to succeed nor to pay the aggressor. If so, there will be no international law again, there will only be international anarchy and no small states would ever feel safe. Fortunately this has come at a time when the Five Permanent Members of the Security Council—the Soviet Union, China, the United States, France and Great Britain—are able to act together and to get the majority, a very big majority, of the Security Council with them, and to make it clear that the resolutions of the United Nations will be upheld, totally.
Question (VOA)
Prime Minister, late last year the Warsaw Pact publicly apologised for its invasion in 1968 of Czechoslovakia. Is it conceivable that Britain, with or without France, Germany and Italy, could also apologise for its role in the Munich Pact of 1938 and for Neville Chamberlain 's insensitive comments about Czechoslovakia? [end p13]
Prime Minister
I did so at a dinner which President Havel attended in No 10 Downing Street as our guest of honour when he came to Britain. I shall repeat what I said tomorrow.
Question
Mrs Thatcher, I have just one question regarding visa-free travel between Britain and Czechoslovakia. You told us this will come into effect on 1st October this year, can you tell us why Britain had been reluctant for such a long time to agree to visa-free travel between the two countries because there have been so many more European countries who have concluded this agreement with Czechoslovakia long before Britain did?
Prime Minister
I am sorry if you think we have taken too long. It is a wholly new regime, a great many people want to come to Britain, and I am sure you think it right that it should be free from 1st October. I am sorry we were not able to get it before that.
Question (Czechoslovak News Agency)
President Havel and Prime Minister. One of the things I think Britain and Czechoslovakia have in common are preoccupations of a certain sector of the population over the reunification of Germany. Did you mention this problem during your meetings and have you come to a common view concerning further development after German reunification in Europe? [end p14]
Mr Havel
We passingly mentioned this subject also. I can repeat what I have said repeatedly. If the reunified Germany is a democratic state and continued to be so, we have no political reasons to fear it. Naturally, the energetic entrepreneurial spirit is coming here from Germany and we do not want to be unilaterally dependent economically on anyone, we have got bad experience with that. More normal competitive conditions are emerging in our country.
Nevertheless, it seems that while deciding on partners, the respective commissions should decide and contemplate the proposals should take as one aspect of their decision-making the political dimension. That is that the economic relations should be established in a balanced way, but they should be established in all parts so that we avoid sinking unawares into another lopsided dependence on someone else.
Prime Minister
Can I just add briefly. The reunification will take place on 3rd October. A very important thing was: first, that the unified Germany should be a member of NATO, that has been agreed and the Soviet Union has agreed to it; and also that the unified Germany be a full member of the European Community so that when East Germany joins West Germany she automatically becomes a member of the European Community as part of the unified Germany. That means a number of transitional arrangements will have to take place, obviously because her industry is in a very different condition. But she will plug, as it were, straight into the whole of the Federal Republic's laws, she does not have to create her own, she will plug straight into the Federal Republic's company laws, her [end p15] contract laws, her banking law, and everything like that.
But we are having to negotiate transitional arrangements with the new unified Germany because it will affect the Common Agricultural Policy, it will affect fishing policy, it will affect fair competition and of course one of the most difficult things will be to ensure that East Germany comes up to our standards on environmental matters because I am afraid she has very severe pollution which we could not accept in the Community. But it is all going ahead.
And the third thing was of course that we get a new agreement with Germany, which we now have, because the old one was the previous four-power occupation both of Berlin and of East Germany, and we had to make strenuous efforts to get a new agreement so that insofar as they are required, our troops should stay there. Now it is not as a result of an occupation agreement, that is terminated, but as the result of an invitation by the new unified Germany.
All of that has been done and the transitional arrangements are being negotiated with the Community.
Question (Paul Williams, Today)
Mrs Thatcher, is there a great risk that more Iraqi diplomats could be expelled from London if pressure is maintained by Saddam Hussein against our Embassy and other Embassies in Kuwait?
Prime Minister
We have taken action in response to what happened just very recently. And the Douglas HurdForeign Secretary was together with other Foreign Secretaries from the European Community and naturally when the European Community has given us support, when we have had to take [end p16] action on various things, we naturally wish to act together over the outrage of the Iraqi troops going into the Residences of certain members of the diplomatic community in Kuwait.
Question (Larry Joseph, New York Times Magazine)
I have just returned from a trip to Slovakia, President Havel, where I met many people interested in being entrepreneurs and their one complaint is that your decision-makers are either too slow or too intent on making decisions for them. I would like to ask you and Mrs Thatcher, what is the art of letting go in economic policy and what is the art of not making decisions but letting them be made?
Prime Minister
It is the art of being a democrat. But it is the biggest change in attitude politically that can take place from a philosophy which says the state shall do everything and the individual and company have no significance, to saying as a democrat that the state's activities and powers shall be limited, they shall have a rule of law and otherwise the liberties of the individual and the company shall be extended. It is a change of attitude and in politics a change of attitude is the most difficult thing to bring about and it takes time.
Mr Havel
Things are not all in the hands of the centre, but the individual businesses still do not enjoy the measure of authority and freedom they should have. It is indeed a transitory stage because the businesses are still often not legal persons. [end p17]
Nevertheless, the scenario of the economic reform our government has adopted envisages very fast attainment of legal personality on the part of the businesses. The administrative functions at the federal level or the state level should be restricted very fast. I firmly believe we are entering an era when economic reform will no more be the subject of contemplation and it will be implemented.
Question (Financial Times)
President Havel, do you believe the British government and other Western governments are doing enough in terms of aid to Czechoslovak industry and government in helping the transition process, and specifically with regard to the UK whether the Know-How Fund is really enough for you and whether you would like to see more help in cash terms over the coming months?
Mr Havel
The Know-How Fund is extremely important for us. But that does not mean that we should not welcome other forms of assistance. Czechoslovakia is not going to resist a possibility to obtain some stabilising funds which are necessary in the process of further stabilisation of our currency. Czechoslovakia welcomes any kind of cooperation, establishment of joint ventures, and any kind of foreign investment. It happens now and then even that investors come and go without achievement only because our reform has not progressed far enough for us to be able to accept the proposals and immediately materialise them in real contracts.
Nevertheless, our interest is quite keen and we enjoy the amplitude of the scope of proposals. Businessmen from various [end p18] countries are coming with most varied proposals and certainly in my opinion we cannot complain about lack of interest, especially on the part of the private sector.
Question
First of all I would like to thank the President for his promise that very soon, even if after the enactment of some new legislation, the BBC will be better heard here. I think after fifty years we still have something to offer, including language courses in English. The listeners of the BBC World Service Czechoslovak section come to us with a lot of enquiries, especially young people who are learning English from the English by Radio courses, and they want to know about contacts with Great Britain. You have spoken about the exchange of young people, they will certainly be delighted about the visa-free travel you have announced today, but is there any possibility in the foreseeable future for them to come to Britain and take short-term jobs with a work permit, like a pairs for example, so that they can stay independently of institutions for a short while and learn the language properly and come back to their own country richer?
Prime Minister
I think the main exchanges would be done through the other most excellent organisation, the British Council, as you know, and [end p19] together you do marvellous work. I certainly will have a look at the other matter.