Gdansk Shipyard, Cradle of Polish Anti-Communism, Seeks Rescue

Poland's Gdansk shipyard, the birthplace of the anti-communist Solidarity movement, has submitted a last-ditch rescue plan to the European Union to prevent its closure.

The European Commission set a Tuesday deadline for the yard to submit proposals on cutting capacity, and thus avoid having to repay state subsidies that could trigger its bankruptcy.

The yard is set to be privatised and either a Ukrainian or Italian company will buy a majority stake under the plan.

"We have outlined a very detailed proposal on how to make the shipyard profitable and make it work in line with EU rules," chief executive Andrzej Jaworski told Reuters. "I am convinced that the crisis can be prevented."

In 1980, what were known as the "Lenin Shipyards" in Gdansk became the birthplace of the Solidarity union which helped bring about the fall of communism in Poland and the Soviet Union.

Political Risk

Closing the yard would be political dynamite and the ruling conservatives are likely to do anything to avoid this ahead of a parliamentary election due in under three months.

Under EU rules, governments can give financial help to ailing companies only if cash is accompanied by plans that would make the firms viable in the long term.

"What the Commission wants to see is not a closed Gdansk shipyard, but a genuine, far-reaching restructuring of a company that would ensure its long-term viability," Commission spokeswoman Amelia Torres told a news briefing in Brussels. "We are perfectly aware of the historic importance of the Gdansk shipyard."

Jaworski said the plan sent to Brussels proposes a cut in capacity until 2014 and a privatisation of the yard.

Polish shipyards blossomed under communism by building merchant ships for the Soviet Union, but its workers were badly paid and mismanagement led to strikes in the 1970s and 1980s.

After communism collapsed in 1989, trade unions blocked the sale of the yard to foreign investors. Subsequent governments avoided radical changes and the yard has hovered on the verge of bankruptcy for years.

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