Poland promises speedy response to EU’s shipyard restructuring ultimatum

Poland late last week promised a speedy response after the European Commission gave it one month to come up with a restructuring plan for the iconic Gdansk shipyard or face having to pay back state aid received by the struggling site.”The Gdansk shipyard will draw up its reply within a week. We believe that a compromise scenario is realistic, as it was in the case of Poland’s two other shipyards,” Deputy Economy Minister Pawel Poncyliusz told reporters. Earlier, the EU’s executive arm set Warsaw an August 21 deadline to come up with a package of “adequate capacity reductions” at the yard in the Baltic port.It warned that it would “consider a negative decision” that could mean the repayment of state subsidies to the yards, which are in the process of being privatized.The EC welcomed “as a first step” Warsaw’s decision to reduce capacity at the Szczecin and Gdynia shipyards, which it described as a necessary move in a restructuring process financed by state aid.Jonathan Todd, the EC’s spokesman on competition issues, told reporters in Brussels that Poland was now facing its “last chance” to save the Gdansk yard.The Gdansk site holds huge historic importance for Poles. A strike by 17,000 workers in August 1980 at what was then the Lenin Shipyard forced authorities to the negotiating table and led to the creation of Solidarity, the Communist bloc’s first free trade union, an event which helped hasten the final demise of Poland’s regime in 1989.The yard now employs 3,000 people.The EC has had Poland in its sights over some 1.3 bln euro ($1.66 bln) in state support for the three struggling yards since 2002, seeking to establish whether the aid has skewed the market. Brussels says that aid to the Gdansk yard alone reached 51.2 mln euro, but Warsaw rejects the figure, saying the real sum was 9.6 mln euro.EU state-aid rules on shipbuilding require such support to be based on far-reaching restructuring plans, which must be financed not only from government coffers but also by private capital.Roman Galezewski, a member of the Gdansk yard’s board, claimed that the argument over competition rules masked another battle over real estate.He alleged that EU officials were playing the game of the U.S. investment funds which bought the yard?s land from Gdansk city hall. The site is on the edge of Gdansk’s picturesque Old Town district and would have huge potential for property developers.”Ever since the massive value of the land bought by the American funds from the city has become known, everything possible has been done to shut down the yard, which has a guaranteed right to rent the place,” Galezewski told AFP.

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