Poland submits shipyard plan to Euro Commission

Poland submitted restructuring plans aimed at saving its historic Baltic shipyards to the European Commission yesterday, in compliance with an EU-imposed deadline.

"The Commission will now analyse the plans carefully over the coming weeks to assess the compatibility of the plans with the requirements of EC Treaty state aid rules," the EU executive said.

If the Commission, the European Union's executive body, rejects the plans, the three yards will have to repay state aid totalling more than €2.3 billion, forcing them into bankruptcy.

"I think the analysis of these documents will take some time, but we need to get an answer by October because the uncertainty is killing the 'yards," Polish Treasury Minister Aleksander Grad said.

State-owned Gdynia and Szczecin and the privatised Gdansk yards employ about 15,000 workers but Polish officials say as many as 60,000 jobs could be at risk if suppliers and related sectors are taken into account.

Successive Polish governments have failed to settle the fate of the symbolically important shipyards, cradle of the Solidarity trade union that helped topple communism in 1989.

Mr Grad did not say how many redundancies are envisaged in the restructuring plans, which involve the payment of further state aid - permissible under EU rules provided it leads to the long-term financial viability of the companies concerned.

"But productivity must rise if the shipyards are to operate in a normal way. Of course, employment is too high in some shipyards, especially in the administrative sector," Mr Grad said.

The 'yards have not made profit on a single ship built since at least 2004, when Poland joined the EU, and would not have survived without subsidies, though analysts say that, properly managed, they could still flourish.

If the Commission accepts the government's restructuring plans, Warsaw would then have to prepare privatisation plans for Gdynia and Szczecin.

Ukraine's Industrial Union of Donbass, which owns the Gdansk 'yard, is interested in buying Gdynia while private Polish firm Mostostal Chojnice wants to buy Szczecin.