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World

China's Influence In The Czech Republic

RACHEL MARTIN, HOST:

Yesterday we heard a story from Prague, where the mayor has taken a stand against Chinese government influence. Today NPR's Rob Schmitz has more about Chinese influence in the Czech Republic. This time, though, Rob takes us to the oldest university in Central Europe.

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ROB SCHMITZ, BYLINE: In Prague's Old Town Square, tourists sip coffee and relax, listening to a street performer while admiring centuries-old architecture. But just around the corner, inside Charles University, the scene inside a packed meeting room is anything but relaxed.

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TOMAS ZIMA: (Speaking Czech).

SCHMITZ: The head of the university, Tomas Zima, is apologizing to colleagues in the school's senate, several of whom are calling for his resignation.

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ZIMA: (Through interpreter) I would like to apologize to all of you. I underestimated the reaction to this. I never thought this could threaten our academic freedoms, freedom of research and freedom to teach.

SCHMITZ: The scandal that threatened to bring down the rector of Central Europe's oldest, most prestigious university is not sexual in nature; it's not embezzlement. Instead, it has to do with a topic that's been at the heart of several scandals in this city in recent years, China - or in this case, says sinologist Martin Hala, Czech institutions promoting Chinese interests.

MARTIN HALA: A lot of things that have been happening in relation to China have been driven by local actors and, in particular, commercial companies and, first of all, this one company that has a huge stake in China.

SCHMITZ: That company is called PPF. It's a privately held financial and investment group with more than $40 billion worth of assets. Its founder, Petr Kellner, is among the wealthiest people in the world, with an estimated net worth of more than $15 billion.

Much of that money comes from China, where PPF's lending division, Home Credit, has become one of China's top lenders. Hala says when Home Credit entered China in 2007, China's government spelled out the terms under which it would grant the lender access to its market.

HALA: According to their own accounts, they were immediately notified that this would not happen until the relationship between the Czech Republic and China improved, because at that point it was still quite chilly.

SCHMITZ: PPF went straight to work, hiring former Czech politicians to help flip the government's anti-communist foreign policy into a pro-China one, arranging a Beijing visit by Czech President Milos Zeman in 2014, even supplying a private jet to fly him back. That same year, China granted Home Credit access to its market.

In this year alone, the company has made loans worth nearly $15 billion to Chinese consumers, equal to two-thirds of its overall lending portfolio. PPF rejected NPR's requests for interviews.

JIRI STICKY: It's the richest private company in the Czech Republic.

SCHMITZ: Jiri Sticky, journalist for Reporter magazine, says PPF's cozy relationship with China has now prompted the company to try and silence faculty at Prague's Charles University. In early October, PPF's Home Credit lending division offered to become the university's corporate sponsor only if the university signed an agreement stating it would not hurt PPF's global interests, interests that included keeping China's government happy.

STICKY: It was translated that the university would have to stop all the critics towards China.

SCHMITZ: And Charles University has many influential critics of China on staff, including Martin Hala and his organization Sinopsis, an institution that has examined and exposed the Czech Republic's questionable dealings with Beijing. Within days of learning about Home Credit's sponsorship agreement with Charles University, students, faculty and Czech media lambasted the university leadership, prompting Home Credit to withdraw its offer and the head of the university to publicly apologize for his role in the matter.

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ZIMA: (Speaking Czech).

SCHMITZ: The university rector's apology may have saved his job, but last week, his secretary in charge of the Czech-Chinese center on campus was forced to resign after it was revealed that China's government was funding the center's pro-China conferences. China's Embassy in Prague did not answer NPR's request for an interview.

Martin Hala says all of this has left a bad taste in the mouths of Czechs who are tired of their government and biggest institutions doing the bidding of Beijing.

HALA: In a democracy, there's a cacophony of voices and people have different opinions. And the People's Republic of China does not like that.

SCHMITZ: Hala says his country has fought too hard against authoritarian regimes in the past to allow its oldest university to choose suppression over expression.

Rob Schmitz, NPR News, Prague.

(SOUNDBITE OF BRYCE DESSNER'S "ST. CAROLYN BY THE SEA") Transcript provided by NPR, Copyright NPR.