EC warning on shipyard subsidies (1)
It is worth noting that the European Commission warned Poland on May 29 to cease subsidising its ailing shipyards and set a deadline of June 26 for Poland to present a restructuring plan. If the Polish Treasury does not heed to the deadline, the EC can...
It is worth noting that the European Commission warned Poland on May 29 to cease subsidising its ailing shipyards and set a deadline of June 26 for Poland to present a restructuring plan. If the Polish Treasury does not heed to the deadline, the EC can order the Polish government to claim back all of the subsidies the shipyards have received.
The EC's investigation focuses on the shipyards in Gdynia and Szczecin, but also the Gdansk Shipyard.
The Commission says the shipyards have received at least €1.3 billion in public support over the past three years.
The EC expects the restructuring to involve privatisation and reducing capacity, by selling of non-essential assets.
EU rules concerning shipbuilding require that state subsidies be tied to extensive restructuring plans.
The restructuring must be financed not only by public subsidies, but also by private capital.
"The Commission...has no choice but to make preparations for a negative decision requiring the repayment of state aid received by the Gdynia and Szczecin shipyards," spokesman Jonathan Todd said.
"If the Polish authorities produce in a short space of time, new concrete and credible solutions that could be implemented immediately to ensure the long-term viability of these two shipyards, the commission would naturally assess such proposed solutions before taking a decision," Mr Todd added.
He said earlier in the week that the Commission had given Poland a one-month deadline to provide further information about restructuring plans for the Gdansk Shipyard.
Changes at the Gdansk Shipyard are a politically sensitive issue as it is the cradle of the Solidarity movement which toppled communism.
According to Poland's Treasury Minister Aleksander Grad, the government is serious about dealing with the shipyards' problems and they are in the process of privatising the shipyards at Gdynia and Szczecin.
I hope that a restructuring plan (which will be acceptable by the EC) is already on the Maltese government's agenda before we experience a similar smack in the face from the European Commission allowing us a short span of time to present our plan. I do not want to see all the state financial aid given to the shipyard having to be paid back.
I recommend that an action plan for restructuring the Malta shipyard is embarked upon, jointly with the private sector immediately.
The process is a lengthy and difficult one and therefore any delays may cost our country dearly.