Poland told to shape up

POLAND will need to get their act together to provide a credible industry restructure plan if they are to receive US$500 million of credits from the World Bank.

Staff Reporter

According to press reports negotiations could last up to one year.

“Currently, our analysis states that production capacities and employment must be reduced in order to achieve efficiency and competitiveness," Polish World Bank spokesperson Jacek Wojciechowicz told Interfax.

According to the International Coal Report, the Polish economy minister Jerzy Hausner warned coal mining trade unions they must approve the closure of five mines or else face the end of subsidies and the subsequent bankruptcy of Kompania Weglowa (KW) Coal Holding. KW was created under the government's current restructuring program from five coal producers with 24 mines.

“The choice is as follows: either everything will go rotten or it will be restructured,” Hausner told KW headquarters International Coal Report said.

Other conditions the World Bank has put on Poland is to demonstrate they can support small and medium-sized businesses in the main coal-mining region, as well as to create jobs for redundant miners.

Of the US$500 million, two US$200 million credits would be used to restructure the industry and the remaining US$100 million would be used to modernise. All credits would have to be repaid over five years.