Poland is close to signing the SAFE agreement. Most of the funds will go to the arms industry
The declaration was made during the celebration of the May Third National Day in Krakow. The head of the Ministry of National Defense emphasized that the government completed the negotiations despite complications following the presidential veto of the bill implementing the SAFE program.
— If everything goes well, we will sign the SAFE agreement on Friday and open a credit line for the purchase of equipment, including anti-drone defense systems. It is for this purpose that the largest part of the money will be allocated, said Kosiniak-Kamysz.
May is marked by contracts for the arms industry
The minister announced that May will be a month of intensive signing of contracts with domestic companies, which is part of the long-term strategy for the modernization of the Polish Armed Forces.
— Our priority is to invest in the Polish arms industry. Huta Stalowa Wola or Mesko in Skarżysko-Kamienna are the foundations of state security. Only where we do not have our own production capabilities, we will use equipment from allies, noted the Deputy Prime Minister.
From the government's perspective, it is also an economic stimulus. According to the declaration, as many as 89 percent SAFE funds are to remain in Polish companies and defense-related sectors.
Who will sign the SAFE agreement
As informed by the government's plenipotentiary for SAFE, Magdalena Sobkowiak-Czarnecka, the document will contain signatures of representatives of the Polish government – including Deputy Prime Minister Kosiniak-Kamysz and Minister of Finance Andrzej Domański – as well as representatives of Bank Gospodarstwa Krajowego. The European Commission will be represented by Commissioners Andrius Kubilius and Piotr Serafin.
In accordance with EU regulations, until the end of May, Member States can independently place orders for weapons under the SAFE program. After this date, purchasing cooperation with other EU countries will be necessary. This is a key time window for Poland, because most of the planned orders are to go to domestic producers.
Read also: Donald Tusk talked about SAFE and KPO. The EC understands “Polish circumstances”
EUR 150 billion for European security
The SAFE program is one of the EU's largest defense projects. It assumes the release of EUR 150 billion of support, mainly in the form of low-interest loans for the purchase of military equipment produced in Europe.
From this pool, Poland has EUR 43.7 billion at its disposal. The funds are intended to finance, among others: the East Shield program, development of anti-drone and anti-aircraft systems, artillery and modernization of military infrastructure.
Read also: A gigantic contract for equipment for the Polish army. Almost PLN 3.5 billion
Presidential veto and statutory bypass
In mid-March, President Karol Nawrocki vetoed the act implementing SAFE, which provided for the creation of a special fund for EU funds. In response, the government adopted a resolution enabling the ministers of defense, finance and economy to sign the contract and loan documents without an act.
Bank Gospodarstwa Krajowego will take out a loan for the Armed Forces Support Fund, and its repayment will not be included in the minimum limit for defense spending.
