Polish Workers Protest at EU to Save Shipyards

The collapse of the shipyards in Gdansk, Gdynia and Szczecin, which employ some 15,000 workers, would be political dynamite in Poland.

Scores of Polish workers protested outside European Union headquarters on Wednesday to try to save three major shipyards from bankruptcy.

The EU executive Commission has given Poland until Thursday to present restructuring plans for the three yards, the birthplace of anti-communist movement Solidarity, which would allow them to avoid repaying an estimated 1.3 billion euros ($2.03 billion) in state aid.

"If we are forced to return this state aid, this will be the end of the shipyard industry in Poland," said Janusz Sniadek, head of Solidarity, which became a normal trade union after the fall of communism in 1989.

The collapse of the shipyards in Gdansk, Gdynia and Szczecin, which employ 15,000 workers, would be political dynamite in Poland and a serious blow to the centre-right, pro-EU government of Prime Minister Donald Tusk.

It could also play into the hands of the Eurosceptic, right-wing opposition, political analysts say.

"We ask the Commission for more time ... to find a solution that would allow us to save our jobs," Sniadek told Reuters, adding that finding strategic investors for Gdynia and Szczecin could resolve the problem.

Some 200 protesters cranked up sirens outside the Commission's main building. They carried a banner saying: "Dictators from the east did not destroy our shipyards, now Brussels officials hold the cards."

At the same time in Warsaw, the main political parties called news conferences to blame each other for the yards' problems, while the government said it would put forward a rescue plan.

RESCUE PLAN

"We fully support Treasury Minister Aleksander Grad's plan to present efficient restructuring plans to the European Commission by Thursday," Economy Minister and Deputy Prime Minister Waldemar Pawlak said.

"The past two years of the conservative government (of Jaroslaw Kaczynski) did not result in any solution to this problem, leading to the current state of things," he added.

Former prime minister Kaczynski said the current cabinet had "totally messed up" the case, endangering the yards' future.

The EU executive says it is bound by strict rules on state aid and that it is running out of patience as successive Polish governments have failed to file credible restructuring plans since 2004, when the country joined the EU.

EU rules allow governments to give financial help to ailing companies only if the cash is accompanied by plans that would make the firms viable in the long term and involve production capacity cuts.

EU Competition Commissioner Neelies Kroes said there would no more leniency for the Polish shipyards and unless Warsaw sent credible plans, she would propose "negative decisions concerning the aid", her spokesman said.

He noted German shipyards had to undergo restructuring in the 1990s and they are now profitable.

Gdansk was bought last year by ISD Polska, a unit of Ukrainian group Industrial Union of Donbass, but according to Polish news reports the company is not willing to repay the past state aid nor to cut capacity.

Poland is also trying to sell Gdynia to Donbass and Szczecin to a domestic or a Norwegian investor. Some analysts say it might be cheaper to buy the yards once they are bankrupt.