State activism in Czechia: responses to the war in Ukraine

Russia’s full-scale invasion of Ukraine has reshaped the environment for Czech firms through soaring energy prices, disruptions to trade and investment, sanctions and supply-chain uncertainty. This paper examines whether the crisis expanded state activism in Czechia and how this activism affected firms’ internationalisation. We analyse four channels of state influence: ownership and investment, the business and regulatory environment, industrial policies, and quiet politics. The findings show that Czech intervention after 2022 was structured by two dichotomies: business challenges versus emerging opportunities, and enabling instruments versus restrictive measures. The most visible shift occurred in industrial policy, notably through the Czech Ammunition Initiative, while other measures included energy-price caps, export insurance, and economic diplomacy. However, their effectiveness was constrained by limited funding and administrative complexity. Compared with Slovakia, Czechia was more politically supportive of Ukraine, but material support and policy instruments remained broadly comparable.