Possible approaches to the revival of the mobilization system of material resources and production capacities in the light of current threats

Date of event: January 10th 2023

On January 10, under the auspices of the PCTR, a closed expert debate on the issue of the approach to revitalizing the mobilization system of material resources and production capacities took place at the CEVRO Institute. The invitation to the debate was accepted by Lieutenant General Ing. Karel Řehka, František Šulc, Luboš Kovařík, and David Hác.  

The changing security environment and the war in Europe bring up new demands for securing defense for the state. The primary imperative is preparing the entire state and society (not limited to the army) for an extensive and intense armed conflict. This crisis in the east wing of NATO exceeds the capability of a peace army, which leads to the necessity to count on the mobilization of more available sources of the state (as well as the resources of the allies). This is a very realistic scenario. This new reality, together with newly emerged demands, must be considered and projected into the actualization of strategic documents in the defense sphere of the Czech Republic in the year 2023.  

There has been a severe reduction in warning time. It is no longer possible to rely on the principle of deterred need. The preparation for the defense of our country must be complex and multi-layered and take place even in a period of peace. When the crisis strikes, it is already too late. Capacities and supplies need to be prepared before a war/crisis, during which it is no longer in the power of the industry to secure it. Preparing for a war conflict must include military and non-military elements of the state’s defense system.  

The available stocks currently need to be increased. They would be exhausted in no time. It is necessary to have the ability to restore them quickly. While existing stocks are drawn down, the industry must switch to war production. The army needs will be identified for the onset of conflict and to ensure the sustainability of our deployed units as part of a collective response. In this case, there must be an effective fund mobilization system.  

The demands on the industry must comprise of demands of the state. Other important themes for NATO and the EU are the abilities and capacity possibilities of the industry. Ensuring the autonomy of a state/Europe and, therefore, the security of supply requires international cooperation of allies. Many abilities have been lost in the last three decades, and it is necessary to get them back for the army’s needs.  

It is necessary to manage the risks and define our priorities. The lack of operational capabilities has concrete and profound consequences. Are we taking it seriously enough?   

The Czech Republic must do everything for the collective defense to work. Based on Article 5, a part of the army will be deployed in the events of the conflict. In comparison, the rest would perform tasks on the state’s territory. The Czech Republic will provide a hinterland for the operating troops. A war in the Eastern wing of NATO would involve the Czech Republic. It is, therefore, also necessary to think about civilian defense, the state’s air defense, the health system’s functionality, and other elements.  

The army’s requirements and the entire state for the industry depend on the expected way of its operational use in the context of forces and means of the Alliance (preliminary plans must have a factual basis). The industry should be invited to dialogue from the beginning, not only after developing strategic documents or adopting systemic and conceptual solutions.  

The system for maintaining the production capabilities of the industry has always existed. It is necessary to revise the legal regulations under new conditions. A basic overview of the industry’s capabilities and capacities exists. The state must communicate what it needs from the industry (for the military, healthcare, energy, and other areas).  

What are the state’s mobilization needs for the industry? As of today, except for ammunition in some cases, nobody in the industry knows an answer to this question. In the past, we never quantified the reserve requirements; the “just in time” solution is impractical. The war in Ukraine shows what the demands could be regarding their volume. They significantly exceed the production capacities of the industry. The industry needs a longer foresight into the army and its needs. A platform (working group) for a dialogue about the state/army’s needs should be established. Securing the necessary production based on current capacities during a crisis will be challenging. EU countries do not create their reserves. This would lead to an extreme and unfulfillable demand during a crisis. Even what Europe itself consumes in peacetime is partially produced outside of Europe.  

Ensuring supply security requires the development of production capacities and minimizing supply chains, placing them under the control of Czech companies, at least in selected priority areas. This necessitates investments in production transfer, meaning transferring know-how to the Czech Republic. A discussion is needed on how to finance these needs – one of the solutions is the creation of a fund for the development of production capacities through legislative adjustments.  

The principle of (state) ownership is not an automatic guarantee of supply security. The fundamental principle for ensuring supply security should be the territorial principle in the Czech Republic, considering the principle of war economy embedded in legislation. The performance of the industry is a crucial element. State-owned enterprises have been and will continue to be necessary. However, the question is about the state’s ambition to own production and other industrial capacities – an example being private-public partnerships or the creation of joint ownership enterprises, with the state owning shares with special rights. Inspiration can be drawn from abroad, for instance, from France.  

Industrial capacities  

Maintaining and developing production capabilities is not just about technology; it also involves people and the need to preserve institutional knowledge. Ensuring the continuity of supplies and demand from the industry is essential; otherwise, it will be challenging for the industry to execute (maintain production capacities and employee competencies). Excess capacities during peace can be addressed through export support (AMOS), international collaboration, and the SSHR system.  

There is a need for a strategy for effective mobilization. There is no industrial concept for the state, let alone a strategy for the defense industry.  

Having a resource strategy or, rather, a strategy for accessing resources is vital. Without resources, the domestic industry will be unable to produce anything, even if its production capacities are in ideal condition. Consideration should be given to cooperation with resource-rich countries in Africa and elsewhere.  

The producers of various defense components are being “driven out” of Europe – due to ecological concerns, social acceptability, and costs. Security criteria were not considered in the past. The solution lies not only at the level of the Czech Republic but significantly at the level of the EU.  

Cooperation between the state and the private sector regarding maintaining and replenishing reserves, such as electronics and ammunition, is essential. A way must be found to maintain the relevance of stored material (moral and physical obsolescence).  

Preparation for future conflicts and anticipating their course is crucial and necessary.