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For a detailed history of the Czech Lands see Bohemia, Moravia, and Czechoslovakia. In response to Slovakia's demands for greater autonomy, Czechoslovakia was on Jan. 1, 1969, declared a federation. The constituent Czech and Slovak republics received autonomy over local affairs, with the federal government responsible for foreign relations, defense, and finance. The Communist regime collapsed in 1989, and in 1990 economic reforms were begun that were especially disruptive in Slovakia, which had a disproportionate share of subsidized state-owned heavy industry. A strong secessionist movement in Slovakia led to a declaration in 1992 that the Czech Republic and the Slovak Republic would separate into independent states. In response to the imminent breakup of Czechoslovakia, a new Czech constitution was written. It was implemented with the birth of the new Czech Republic on Jan. 1, 1993.
VAclav Havel, who had been president of Czechoslovakia, became the Czech Republic's president; after legislative elections a right-of-center coalition government came into office, headed by VAclav Klaus. The government moved quickly to privatize state-owned businesses, and mutual funds became a popular investment vehicle for a public unused to dealing with a stock market. However, the economy faltered in 1997 and Klaus was forced to resign. Austerity measures were put in place and Josef Tosovsky, a banker, was appointed caretaker prime minister. Havel was reelected in 1998 and, following legislative elections later that year, Social Democrat Milos Zeman became prime minister, vowing to slow privatization and return more control to the state. In the 2002 elections the Social Democrat–led coalition was returned to power, but Zeman, who had resigned as party leader prior to the election, was replaced as prime minister by VladimIr Spidla. VAclav Klaus was elected president in 2003, succeeding the retiring Havel.
The Czech Republic has actively sought membership in Western institutions and alliances. In 1994 it became an associate member of the European Union, in 1995 it was admitted to the Organization for Economic Cooperation and Development, and in 1999 it joined the North Atlantic Treaty Organization.
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