MoD State enterprises adversely affected by Ukraine crisis

Autor: Nuala Casey, Oldrich Holecek

Deputy Defence Minister, Tomas Kuchta, this week, informed the Committee on Defence of the Czech Parliament that the crisis in Ukraine is now directly affecting the economic activities of the two state enterprises of the Ministry of Defence.

The Ministry of Defence has, therefore, prepared an action plan to modify production and adjust trade strategies, with a view to increasing support and effectiveness of these enterprises.

This situation is especially relevant to LOM Prague, the company that repairs and maintains Russia-made Mi-type helicopters. The Russian spare parts manufacturer has suspended supplying parts to the Czech Republic following EU sanctions against Russia.

The second company, VOP CZ Novy Jicin, lost its Ukraine supplier of sheet metal which, due to the higher prices of potential new suppliers, has led to a decline in VOP CZ’s production.

The action plan aims to increase the volume of orders designated for the Ministry of Defence by integrating both enterprises into NATO and EU multilateral projects and programmes, making it possible to find new suppliers and thus stabilising trade relations.

Analyses of the production and repair processes should also mean that companies can meet the deadlines of ongoing contracts by reducing overhead costs and also making other associated economical savings.

The members of the Committee of Defence have taken the recommendations into account and will be ready to discuss the details of the action plan at the Chamber of Deputies as soon as it is presented.

Chamber of Deputies of the Czech Parliament - Committees (

November 18, 2014