Business & Economy Hungary News Poland Politics & International

“Time is running out” warns Polish business confederation ahead of key EU summit

WARSAW, POLAND – In a joint letter to the European Union, business representatives from France, Germany, Italy, Spain and Poland urge EU member states to overcome their differences and give their green light for the deployment of the much-needed Recovery Plan, still blocked by the Polish and Hungarian governments.

“Europe urgently needs a growth enhancing recovery plan,” reads the letter, co-signed by Maciej Witucki, President of the Polish Confederation Lewiatan, Poland’s biggest and most influential business organisation. “Time is running out”.

Previously called the Polish Confederation of Private Employers, Lewiatan was established in 1999 to represent employers’ interests in Poland and in the European Union.

“The situation has deteriorated in recent weeks with a second wave of lockdowns and the spread of the COVID-19 virus much faster than expected,” continues the letter, also signed by France’s Medef, Germany’s BDI, Italy’s Confidustria and Spain’s CEOE. “The path back to pre-COVID levels of output is likely to be long, uneven and with a high degree of uncertainty.”

“It is imperative that policymakers support our economies, a swift response must be provided,” urge the five European business leaders whose countries are among the main beneficiaries of the Recovery and Resilience Facility (RRF), with almost two third of the grants’ component expected to support their reforms and investments.

“If we really want to succeed the fight against the pandemic, forces must be joined and deployed to move forward and start to rebuild our future,” concludes the letter.

Poland and Hungary are sticking to their position

With a growing number of companies waving a white flag as COVID-19 wreaks havoc on the global economy, the Polish and Hungarian governments are so far still sticking to their tough negotiating position ahead of tomorrow’s key European Union summit that should finalize the bloc’s €1.8tn budget, which includes a major pandemic recovery package.

Last month, Hungary and Poland followed through on their threat to veto the EU’s historic budget over a clause that ties funding with adherence to the rule-of-law in the bloc.

Needing a unanimous vote from all 27 members in order to pass the bloc’s seven-year budget and recovery package, ambassadors meeting in Brussels were thus unable to endorse the massive financial plan aimed at rebuilding Europe’s shattered economy.

The rule of law debate has to be separated from the EU budget and the Covid Recovery Fund, reiterated Viktor Orbán in his weekly radio show last week.

Poland’s Deputy Foreign Minister Paweł Jabłoński also told The Associated Press Friday that Poland’s position remains as it has been from the beginning, which is that “we are ready to talk, we are ready to come to a compromise, but that there are some red lines” that Poland would not abandon.

Rule-of-law and democratic norms in the EU

Hungary and Poland, who have long been at odds with the EU over the issue of declining democratic norms, are stauchly opposed to the clause that could see them lose billions in EU subsidies should they continue with policies seen as eroding democracy.

The two countries are currently under investigation for undermining the independence of courts, media and non-governmental organisations.

Last month, U.S. President-elect Joe Biden had irritated Polish and Hungarian authorities after comparing their respective governments to “totalitarian regimes” after commentators pointed out that a Biden win in November 2020 could spell trouble for Hungary and Poland, and pave the way for a refocusing of U.S. foreign policy on rule-of-law and democratic values.