PM optimistic about reaching agreement with EC over recovery funding

Poland's prime minister expressed cautious optimism on Wednesday over talks with the European Commission (EC) concerning money from the EU's Recovery Fund.

Mateusz Morawiecki told a press conference that if the law and rule of law were binding in the EU, then Poland should have nothing to fear concerning the pay-out of money from the bloc's recovery fund.

Poland and the EC are in talks over the release of up to EUR 58.1 billion, including EUR 23.9 billion in grants and 34.2 billion in loans from the bloc to aid economic recovery in the wake of the coronavirus pandemic.

While talks between Brussels and Warsaw are already underway concerning the country's National Recovery Plan, which all member states had to submit, EU economic commissioner Paolo Gentiloni has said the issue of primacy of EU law is one of the reasons they are taking so long.

Morawiecki has asked the country's Constitutional Tribunal to assess whether EU law has primacy over the Polish constitution in a matter connected with changes to the Polish judicial system, an issue that has led to a prolonged dispute between Warsaw and Brussels.

Morawiecki said that the Polish government expects the Recovery Fund money to be paid out starting from next year, or the fourth quarter of this year, at the earliest. "But that in no way hampers our pace of economic development, because - as local government officials and residents of very many municipalities and districts already know perfectly well - we launched the first phase of the Polish New Deal in July."

The Polish New Deal is the government's flagship economic reform programme.

The prime minster went on to say that the country's economic growth is ever more "endogenous," and increasingly based on internal drivers.

He said the National Recovery Plan is an important element for his government, but that adversaries sometimes only remembered the situation five or 10 years ago when most motorways and expressways were built with EU funding.

"In the National Road Building Programme I announced recently... 80 percent of funds in the budget, close to PLN 300 billion (EUR 66.5 billion), comes from the Polish state budget," he said, adding that this was thanks to a tightening of the financial system.

On the subject of Poland's National Recovery Plan, Morawiecki said talks would continue with the EC. "I am still a cautious optimist that we will manage to reach agreement with the European Commission," he said. "I think we will manage but I want our economic growth to be based most strongly on internal drivers, on internal fuel."

He said that was why his government had tackled VAT mafias and tax criminals.