Warsaw v. Brussels: Investments and EU funds at risk

The growth of foreign investment

“The quality of the workforce, the infrastructure, and the friendly business environment have prevailed over the political follies of recent years. Poland has solid foundations that foreign investors consider more important than disagreements over the judiciary and a move away from liberal democracy,” says Solomir Magman, Deputy Director of the Institute for International Security and Development, and until 2015, he was the senior head of the Polish Agency for Investments. “Since 2016, Poland has experienced growth Foreign investment continues. In the first quarter of this year – Majman asserts – Poland was the third global destination for foundation projects after the United States and Spain.

But how long will economic activity be able to withstand the ongoing disputes with Brussels over immigrants, media freedom, and the independence of the judiciary? “The founding values ​​of the EU project are at stake: violations of the rule of law cannot be recognized,” EU Commission President Ursula von der Leyen noted, attacking Polish Prime Minister Mateusz Morawiecki, in the European Parliament. The credibility that Poland has gained is also at risk.

EU funds blocked

The European Commission has not yet approved the 60 billion recovery plan presented by Morawiecki’s government, and the European budget resources, which are more than 100 billion euros between now and 2027 for Poland, are somehow subject to respect for the rule of law. “The rules are very clear. Von der Leyen told Prime Minister Morawiecki that the investments of the recovery plan are linked to reforms that must follow specific recommendations for each country. Among these, for Poland, is the restoration of judicial independence.”

“The freezing of European funds can have a very negative impact on the Polish economy: they are in fact resources dedicated to financing investments in critical areas of development: digitalization, green energy, competitiveness,” Orlovsky says. Poland is among the main beneficiaries of European funds: an amount equal to over the years about 2% of GDP. “More modern cities, railways, highways, agricultural development in the East: these are – says Majman – the direct effects we have obtained by making the best use of European money. There is no reason for Poland to give up these resources.”

Polexit is no longer just a nightmare

However, despite Morawiecki’s apparent denials, Polexit, Poland’s exit from the European Union, is no longer just a provocation. Until recently, I thought Polexit was just a nightmare generated by fringe groups of nationalist extremists. Now – says Majman – I fear it is part of the hidden strategy of the ruling conservative and populist party. 80% of Poles support remaining in the union, but a relentless campaign against Europe, and the beating of the public media, which is wholly controlled by the government, could change that. Kaczynski can think of leaving the EU as a great political act for him.”