September 6, 2018 / 7:24 AM / in a month

Poland, seeking bigger role, threatens to block EIB post-Brexit plan- FT

KRYNICA ZDROJ, Poland (Reuters) - Poland is threatening to block a post-Brexit capital plan for the European Investment Bank EIB.UL unless it can secure a bigger role at Europe’s biggest development lender, the Financial Times reported on Thursday.

FILE PHOTO: The logo of the European Investment Bank is pictured in the city of Luxembourg, Luxembourg, March 25, 2017. Reuters/Eric Vidal

Prime Minister Mateusz Morawiecki told Reuters he wanted to increase Poland’s influence in the bank but, when asked about the reported threat, would only say Warsaw was being “very tough” in talks about the EIB’s future.

The FT cited sources close to the matter saying Poland - the European Union’s biggest eastern member - was pushing for more involvement in the bloc’s major institutions given Warsaw’s growing economic clout.

Britain is currently the joint-biggest shareholder in the bank which is owned by all the bloc’s governments and uses their capital deposits as security to fund loans for research, infrastructure and environmental projects in Europe and beyond.

Britain’s departure will deprive the bank of capital, including 3.5 billion euros ($4 billion) payed in directly, the FT reported.

The FT said Poland had threatened to block a plan for EU governments to replace the 3.5 billion euros unless Warsaw was allowed to increase its own relative shareholding.

The EIB and Poland’s finance ministry declined to comment.

But a source in Poland’s government, who asked not to be named, said Warsaw was not making threats but instead pushing what it felt was a better plan to bring in fresh funding, rather than draw on existing reserves to fill a gap.

Relying on existing reserves would not be enough to safeguard the bank in the event of a hard Brexit, the source added.

“Poland is not threatening anyone, just the opposite - it is submitting a very specific proposal, which is beneficial for the bank,” the government source said.

An EIB source did not comment on Poland’s position, but told Reuters that officials there were discussing proposals from some member states who “have offered to pay in fresh capital, increase the proportion of their membership or share in the EIB, and support additional lending”.

Another person familiar with the situation said Poland’s plans would be discussed at the EU finance ministers meeting in Vienna on Friday.

Poland received 5.1 billion euros in financing from the EIB in 2017, making it the fifth largest recipient of EIB loans last year.

($1 = 0.8604 euros)

(This story has been refiled to remove extraneous word from first paragraph)

Reporting by Mekhla Raina in Bengaluru; Marcin Goclowski in Krynica Zdroj, Pawel Sobczak in Warsaw and Gabriela Baczynska in Brussels; Writing by Agnieszka Barteczko; Editing by Sai Sachin Ravikumar and Andrew Heavens

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