When Poland’s Prime Minister Beata Szydlo swept into office in
October 2015, she promised she would protect the coal industry’s 100,000
jobs. Now the PM, who happens to be a coal miner’s daughter, is under
pressure to break this promise.
As reported by the Reuters news agency, the energy ministry has said
the country’s biggest mining firm, headquartered in Silesia, risks
running out of cash at the end of the month. It is a familiar cry, and
in the past, funds somehow appeared.
This time, however, they may not.
According to Reuters, coal miners became heroes in Silesia when nine
of them were shot dead in 1981 in an anti-communist protest against
martial law. Now they are being asked to accept cuts in salaries that
are among the highest in Poland because of the dangers of the job.
Energy ministry officials supervising Kompania Weglowa (KW), the
European Union’s biggest coal mining company, say it cannot pay salaries
in May if trade unions’ reject a plan to cut the company’s costs, more
than half of which go on staff.
The government also wants KW’s creditors—including the Polish unit of
Spain’s Banco Santander BZ WBK and France’s BGZ BNP Paribas to convert
their debt into KW shares, reported Reuters.
“The talks are held on the highest level,” a government source said,
adding that the banks’ final decision is expected early in the coming
week. This was confirmed to Reuters by another person.
Together, BZ WBK and BNP Paribas hold 150 million zlotys of KW’s
debt. Any exposure to coal is considered financial risk and the European
Union is considering “carbon stress-testing” its financial firms.
The trade unions at KW accept cost-cutting in principle, but refuse to agree to wage cuts or layoffs.
“Cuts in wages would be an act of self-destruction,” Boguslaw Hutek, the head of KW’s biggest trade union, said.
In an interview with Reuters, Michal Wilczynski, a former chief
geologist in Poland and former deputy environment minister, said trying
to rescue Kompania Weglowa was futile.
“It’s too late to rescue it. Poland’s coal mines will not be
effective, no matter how deep the cost cuts are, because of geology,”
Wilczynski said. “Rejecting the global trends would take us back to the
Communist era with an isolated economy.”
Meanwhile, KW has been struggling unsuccessfully to convince Brussels
for EU approval to use public money to keep open loss-making mines.
According to Reuters, there is little sign Brussels will approve that.
The Competition Commissioner has said she can only allow funding of
uncompetitive mines on condition they are being phased out, which is at
odds with Szydlo’s electoral promise that she would not close any mines.
https://neurope.eu/article/polands-love-affair-coal-might-not-last-long/