Czech Republic Struggles to Finance Arms for Ukraine

The Czech Republic will continue to prioritise supporting Ukraine against Russian aggression by helping it finance its weapons despite its obvious difficulties in consolidating its public finances.

Already, for the last increase in contributions in June, the Czech Republic could barely find the funds, leading to scepticism in Czech foreign policy circles about the country’s ability to cope with the massive financing of foreign instruments.

In addition to the net financial commitment to the EPF, there is also the problem of the need to consolidate Czech public finances, which is currently the subject of political debate in the lower house of parliament.

The government of Petr Fiala (ODS) is currently defending its consolidation package to the public and the opposition while at the same time preparing the state budget for 2024.

Neither of these fiscal measures has been well received by the public.

In this situation, the government also wants to continue funding military supplies to Ukraine, which is not easy.

The solution lies in the promise to reimburse some of these supplies from the EPC in the coming years, but the concrete options are unclear.

In addition to the net financial commitment to the EPF, there is also the problem of the need to consolidate Czech public finances, which is currently the subject of political debate in the lower house of parliament.

To address this, the Foreign Ministry is preparing material to identify these options. It will then be clearer how much the Czech Republic can currently spend on arms for Ukraine.

The European Peace Facility, which finances arms for Ukraine, is likely to see its third significant increase in funding. The EU’s  Borrell wants to put €20 billion into it this time.