John Tagliabue, “Solidarity Plans to Join Regime in Asking Debt Aid”, The New York Times - March 3, 1989

 

The Main Point

In Warsaw, Poland, negotiators from the Polish Government and the Solidarity union are working together to issue a joint appeal for the relief of Poland’s foreign debt. This appeal will challenge Western Governments to lift the remains of the sanctions placed upon Poland for its imposition of martial law seven years ago. The appeal might contain requests such as relief on the interest payments of the debt, the renewal of Western guarantees for commercial bank loans, and more favorable conditions for relief under a standby program of the IMF.

 

Background

Government officials in Poland say the Solidarity union’s support of the appeal is part of the price it must pay to recover its legal status, lost when martial law was declared in Dec. 13, 1981 which marked the end of the liberalizing trends that had led to the birth of the union in 1980. Western governments placed sanctions on Poland to punish the government under General Jaruzelski for the imposition of martial law. The sanctions included the refusal to grant fresh credits to Poland, refusal to admit Poland to the International Monetary Fund, and refusal to grant World Bank loans. Western governments lifted most sanctions when martial law was formally scrapped and political prisoners released in 1984.

 

Last year (1988), Poland owed 37.9 billion to Western nations and banks, with total debt growing. Poland has the lowest per capita export earnings in Europe and deteriorating industrial plants. In short, Poland needs loans and investments. In November 1988, the World Bank made its first loan to Poland.  

 

Now, the government and the Solidarity union have agreed to issue a joint appeal to Western governments. Negotiators from both groups are on their fourth week of working on the accord. The appeal will come to the Bush administration at the same time they are conducting a review of East-West issues. The review will include discussions about the potential of Warsaw Pact nations like Poland to develop closer ties to the West and reduce their dependence on the Soviet Union without threatening Soviet interests. It will force the US and Western allies to decide whether or not to fulfill their pledges to ease Poland’s debt if the Polish government agreed to end the repression of the Solidarity union.