Much ado about aid
Under the 'temporary defense mechanism', which the EU introduced to protect its shipbuilding industry from cheap exports, the European Commission gave Poland permission in April to grant aid to ailing shipyards in Gdynia, Gdańsk and Szczecin, worth up to six percent of the value of the yards' contracts.
But that permission comes with some strings attached. For instance, a country can only dole out such aid if it is accompanied by a plan that not only looks to service debt and help cash flow, but contains a detailed, long-term industrial restructuring proposal. The Commission said it has doubts whether the aid will restore the long-term viability of the yards, and is launching an investigation.
"We need to see a plan which is likely to result in viable companies capable of facing up to competitive pressures within the EU," competition commissioner Neelie Kroes said.
The Netherlands, Italy, France, Denmark, Spain and Germany also grant financial assistance to their shipbuilders. (Reuters)
But that permission comes with some strings attached. For instance, a country can only dole out such aid if it is accompanied by a plan that not only looks to service debt and help cash flow, but contains a detailed, long-term industrial restructuring proposal. The Commission said it has doubts whether the aid will restore the long-term viability of the yards, and is launching an investigation.
"We need to see a plan which is likely to result in viable companies capable of facing up to competitive pressures within the EU," competition commissioner Neelie Kroes said.
The Netherlands, Italy, France, Denmark, Spain and Germany also grant financial assistance to their shipbuilders. (Reuters)
