Poland wants EU environment aid even as it resumes work on controversial motorway

By bne IntelliNews July 26, 2007

Bogdan Turek in Warsaw -

Poland's decision to resume work on August 1 of a motorway across an ecologically fragile area despite the strenuous objections of the European Commission may seem strange given its bold plan to use 100% of the €27bn approved by the Commission for the improvement of the environment in the years 2007-2013.

"We want to be the best in the European Union in the absorption of funds," claims Environment Minister Jan Szyszko. "We want to set the record in the EU by our performance."

Szyszko said Poland intends to best all EU members, from Greece which managed to use 46% of funds allocated to it in the past by the European Commission, to Spain and Portugal which hold the record of 85% absorption.

Environmental analysts do not question that it's feasible to use nearly 100% of funds. "The use of money will be supervised by the Ministry of Regional Development which is managed by a very efficient minister, Grazyna Gesicka," says Ryszard Pazdan, environmental specialist in the Business Center Club (BCC), which groups several hundred private enterprises that employ some 600,000 workers.

The European Commission approved a total of €67bn for the Polish economy in May for the years 2007-2013 within the plan called the National Strategic Reference Framework. The €27bn to be used are included in the "Infrastructure and Environment Program.

Grazyna Gesicka, the Minister of Regional Development, said at a news conference that Poland never had so much money for the improvement of the environment. "It is a program without precedent in the history of the European Union," said Gesicka. "We have never implemented such a big program, the largest not only in Poland but also in the European Union."

Road to perdition

Szyszko made his pledge after signing an agreement with Kazimierz Kujda, CEO of the National Fund for the Environmental Protection (NFOS), who will be responsible for the allotment of finances for priority projects in the water and sewage area, waste management, and improvement of environmental standards in major industrial enterprises. The funds from the European Commission will be used for the improvement of water and sewage pipes in 318 cities and installation of 70 kilometres of water pipes. The agreement specifies the use of the first €6bn from the total of €27bn.

NFOS has 16 years of experience in the use of funds for the environment. Initially, it got most of its funds from fines imposed on the largest industrial polluters in the country. The operational model of NFOS became an example for many former Easteran Bloc countries. Staying under the supervision of the Environment Ministry, it also set up the state Bank for the Improvement of Environment (BOS), the only bank of this kind in Europe, which offers low-interest loans to companies implementing environmental projects.

According to Kujda, more than 400 recycling facilities of waste will be built with the Commission's money and industrial plants will be entitled to apply for purchase of best available techniques equipment to cut use of water or to improve emission of pollutants.

Jerzy Walczak, the spokesperson for NFOS, told bne that the list of the detailed projects will be known at the end of August. "The tenders for the potential construction companies will be announced in September," says Walczak. "We welcome both domestic and foreign investors."

However, the elephant in the room is Poland's controversial decision to resume the construction of an international highway linking Warsaw to Helsinki via the Baltic states through the northeastern Rospuda Valley - one of Europe's unique mashlands, which is home to rare plants and animals.

Warsaw suspended the construction of a viaduct over Rospuda until August 1 due to a bird nesting season in the region, but the Commission wants construction stopped completely and is threatening legal action as the bypass appears to break EU environment laws. The Commission's environment spokeswoman, Barbara Helfferich, told reporters on July 17 that the EU executive would not hesitate to turn to the European Court of Justice (ECJ) to get the work halted.

"We have a letter ready to be sent to the court to ask for interim measures and they can be applied very quickly," Helfferich was quoted as saying. "If [the Polish authorities] resume, then the Commission would definitely send the letter."

Like most infrastructure and environmental projects, Poland is looking for EU aid to build the part of the motorway that doesn't run through the Rospuda marshland. The aid would come from the 2007-2013 budget and probably be used from 2011-2015. The government, which already has a very fractious relationship with the Commission, appears to believe that if it uses its own money to fund the bypass, it will still be able to receive EU infrastructure funds for the rest of the motorway.

However, there are doubts about that, since to get the aid the government will have to submit a environmental impact assessment. Agence France-Presse quoted an unnamed EU official with close knowledge of the project as saying this environmental report would surely kybosh the government's hope of aid. "It can't be like this, that they come with a project that is all but the bypass, and that the rest is fine from the environmental point of view and say: 'We will not show you the by-pass because you will not accept that'," he said.

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