Andrej Babis still has his work cut out for him to restore public confidence in his administration.

Prague, Czech Republic – Prosecutors halted work on a criminal case against Prime Minister Andrej Babis but the charges have left the leader of the centrist Ano party heading a weak government while facing mass protests.

While the billionaire populist – often compared with Silvio Berlusconi and Donald Trump – looks to have avoided a possible 10-year jail sentence, claims that he is damaging democracy are rising.

The accusation that Babis fraudulently obtained two million euros ($2.2m) in European Union funds in 2009 via his Agrofert conglomerate to build the Stork’s Nest leisure complex has overshadowed his political career for years.

“The decision to drop the case will not do much to improve trust in Czech politics, which is already very low,” Professor Vladimira Dvorakova at the University of Economics in Prague told Al Jazeera.

Milion Chvilek, or the Million Moments for Democracy NGO, has organised massive protests in recent months, and it questioned the decision to drop the charges.

“Without a clear and credible explanation of the sudden change, public confidence in the rule of law is severely shaken,” it said in a statement.

The prosecutor’s office announced only that supervisory prosecutor Jaroslav Saroch, in charge of the case for four years, has “changed his original legal opinion”. Saroch’s full report will be reviewed in the coming weeks.

Polarisation

The decision was announced as Babis celebrated his 65th birthday. The prime minister told reporters it was “a nice gift”.

The billionaire, whose anti-establishment party rose to power with promises to end the corruption that has long blighted Czech politics, has always protested his innocence. He said the case was “ordered” by the “political elite” that he deposed.

The prosecutor’s decision will do little to stabilise a deeply divided political system. The accusations against Babis saw mainstream political parties refuse to join his government after Ano won 2017 elections with 30 percent of the vote.

They were quick to signal nothing has changed.

“If Mr Babis were not prime minister he would have been in jail already for a long time,” said Ivan Bartos, leader of the Pirate Party.

Public opinion is also entrenched. The case has helped polarise the outlook of the urban, liberal electorate and more conservative voters in the provinces. Babis’ mostly older supporters have long been convinced of their leader’s innocence. His opponents, meanwhile, increasingly fret that democracy is under threat.

“This decision has many people panicking that the rule of law is over,” Benjamin Roll, vice president of Milion Chvilek, told Al Jazeera.

Plans in place

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The NGO launched its protests in April, when one day after the police recommendation to indict him, Babis replaced the justice minister without warning.

Saroch’s surprise about-face only has only raised worries over judicial independence in the country.

Milion Chvelik said it hopes more than 300,000 will turn out at its next rally on November 16 – the 30th anniversary of the Velvet Revolution that ended communist rule.

Roll said the prosecutor’s decision would add momentum as “the list of protest issues grows”.

Having failed in a lawsuit against the national archives last year, Babis is listed as a collaborator with the communist-era secret police. The EU is also expected in the coming weeks to finalise a report stating Babis has conflicts of interest concerning EU subsidies paid to Agrofert.

While the decision of the prosecutor removes the threat of an imminent jail term, it will do little to end the instability that plagues the government, which has been encouraged by President Milos Zeman, a controversial populist who seeks to win leverage over policy for himself and hardline parties.

Dvorakova suggested the president may try to provoke unrest between Ano and the Social Democrats, the junior partner in the minority coalition.

“The [prosector’s] decision strengthens Babis’ hand,” she said, “but the president will have plans in place to deal with this scenario.”