Poland’s centre-left government led by Prime Minister Donald Tusk has announced it wants to channel €7.2 billion worth of the European Union’s post-pandemic recovery funds into defence and security.
If approved by the European Commission, Poland would become the first EU member state to carry out such a switch in funding.
“We are the first in Europe to initiate this project of key importance within the framework of the National Recovery Plan,” Tusk told a cabinet meeting on 25 March.
“Every decision of this kind, which concerns the modernisation of the Polish army, defence industry, strengthening of the border, puts off the danger of war and is an action for peace,” he added.
The government planned to use the resources in the European Commission’s newly created Security and Defence fund in order to strengthen security infrastructure, including modernisation of arms companies, bolstering cybersecurity and civil defence.
The funds, which are to be made available to local authorities, companies and academic bodies, will be provided in the form of preferential, low-interest loans or partially redeemable equity investments.
“We will invest billions in shelters, dual-use infrastructure, and the development of Polish defence companies,” said Katarzyna Pełczyńska-Nałęcz, the minister of funds and regional policy, after the meeting of the Tusk cabinet.
The move would require the approval of the commission but the Polish Government said it was confident that the reallocation of the EU funds to defence was consistent with the body’s recently announced ReArm Europe plan to bolster Europe’s security.
Despite that, a report by financial news portal Money.pl claimed the commission was concerned at how a move to switch post-pandemic funding to military and security purposes would be viewed by the European Court of Auditors.
Polish post-pandemic recovery funding was blocked during the term of the previous Conservative (PiS) government over a rule-of-law compliance dispute, which ended with the arrival of the Tusk government in late 2023.
Poland was also awaiting commission approval of its plans to provide state aid for the development of its first nuclear power plant,
In December of last year, the commission said its “preliminary assessment has found that the aid package is necessary” but that it still “has doubts at this stage on whether the measure is fully in line with EU State aid rules”.
Therefore it launched an ongoing “in-depth investigation” into the provision of state aid as well as its potential impact on competition in the electric power market.
The US is the strategic partner for the construction of Poland’s first nuclear power station and Poland has been praised by US President Donald Trump’s for planning to spend 4.7 per cent of its GDP on defence this year, the highest relative figure in NATO.
