Solidarity Workers Defiant...

Two decades after they helped overthrow communism in eastern Europe, shipyard workers in Poland's Solidarity are ready to fight for the right to share the subsidies that have bailed out businesses in the West.

Their jobs at risk in a protracted dispute with Brussels over state aid, workers in the labour union that played a crucial role in the struggle for democracy feel angry and betrayed by their own government and the European Union.

With General Motors only the latest major recipient of government funding in the developed world, EU calls on Poland to scrap the state aid that has propped up an inefficient industry fall on increasingly angry ears.

"The European Union says it must protect European jobs -- so why does it want us to close and to order ships from Asia?" said Roman Galezewski, head of the Solidarity branch at the sprawling Gdansk shipyard.

"There is a real will to fight here now... Shipyard workers here fought against tanks in the 1970s with their bare hands. You can't mess with people like this."

The workers now number about 3,000, down from 12,000 in Solidarity's heyday in the 1980s, and represent a fraction of the city's workforce. But their symbolic force is considerable.

Lech Walesa, the shipyard electrician who led Solidarity to victory in 1989 and became Poland's first post-communist president in 1990, recently appealed to the EU to save the Gdansk shipyard, saying it was part of Europe's heritage.

"Our people are furious with Brussels for subsidising some industries while forbidding aid to us," said Galezewski.

Strife has long dogged Poland's shipyards. The state aid that triggered the EU probes was the result of inefficient work practices at the yards, which have not made a profit on a single ship since Poland joined the EU in 2004.

ISD Polska, a unit of Ukrainian group Donbass, bought a majority stake in the Gdansk shipyard in 2007, saving it from bankruptcy, but is now awaiting a European Commission ruling on whether more than 700 million zlotys ($222 million) of aid paid to the yard over many years was illegal and must be repaid.

Solidarity says the aid totalled only 30 million zlotys.

Discrimination

The Commission has already ordered the state-owned shipyards of nearby Gdynia and of Szczecin to repay billions of euros of aid. Those yards are now in the process of being sold to another investor, United International Trust.

Polish officials have suggested United International Trust represents a Gulf-based buyer, but neither the Trust nor ISD were available for comment on their plans for the Polish yards.

Politically, the timing is awkward. Poland's once-booming economy is slowing fast and Poles are also keenly aware that western European governments have been spending billions of euros of taxpayers' money to support banks and carmakers as the Commission stands by.

Warsaw has offered one-off pay cheques for shipyard workers who lose their jobs in the restructuring of firms and has also offered retraining to some.

Solidarity, opposing any job losses, says employers should instead be recruiting more people to safeguard the future of shipbuilding. Galezewski was also dismissive of plans to retrain workers for an increasingly service-oriented economy.

"Which sector is now able to employ more people in such a crisis?" he said. "We will just spend money on creating new jobless. An unemployed welder or unemployed barber, it is the same thing."

The workers' anger has forced Prime Minister Donald Tusk, himself a Gdansk native, to move some celebrations planned for June 4 to mark the 20th anniversary of Poland's first free elections from Gdansk to Krakow in distant southern Poland.

Rich Past, Hi-Tech Future

With its cranes and towering monument of three crosses in memory of workers killed in anti-communist riots, the shipyard is still a brooding physical presence in this city of 400,000 people. But it no longer dominates the economy.

Lotos, Poland's number 2 oil refiner, is now the biggest single employer in the Pomorze region which includes Gdansk. Foreign investors here include IBM and Sharp among others.

Public sympathy for the workers is also wearing thin.

Despite the passion of Solidarity members, many in this Baltic port feel Gdansk's future lies with information technology, tourism and service industries and see shipbuilding as a communist-era relic undeserving of further bailouts.

"If something is unprofitable, it must be closed," said Tomasz Musial, one of several rickshaw drivers working in Gdansk's picturesque old town. "If we had no customers we could not just sit here and expect the state to pay us."

Famed for its amber jewellery and tall narrow merchants' houses reminiscent of Amsterdam, Gdansk's streets are thronged with tourists in summer, many of them Germans drawn to the city which, as Danzig, was German for part of its history.

City officials do not want to talk only of the past.

"High technology is our future," said Antoni Pawlak, spokesman for Gdansk's mayor, adding that high-tech is a force for improvement to the region's infrastructure and flight connections, making Gdansk more international.

"The shipyard workers feel they have given us democracy so they deserve respect... But in purely economic terms, we might as well shut down the shipyards," he said.

He noted that west European shipbuilders have also succumbed over time to foreign competition, especially from east Asia.

"Of course, the fate of the Gdansk shipyard will have an influence on the labour market, but today we think most of the people would find new jobs in other firms," said Tomasz Matjaszczuk of the Gdansk Economic Development Agency.

"As well as the Gdansk shipyard, there are other shipbuilding firms here. Some build smaller ships, some deal with repair work, others build yachts. We see demand for luxurious yachts from foreign buyers hasn't really dropped."

Gdansk, one of four Polish cities chosen with venues in Ukraine to host the 2012 Euro soccer championship, now needs to focus on improving its poor rail and road links with the rest of Poland in time to welcome tens of thousands of fans, he said.

(Reuters)

---