Poland's Tusk to Use EU Defense Loans Despite President's Veto

Polish Prime Minister Donald Tusk vowed to use 43.7 billion euros ($50.1 billion) in European Union defense loans despite a veto by President Karol Nawrocki on the bill enabling access to these funds, according to multiple reports.

The decision by opposition-backed President Nawrocki has intensified a rivalry with pro-EU Prime Minister Tusk that complicates policymaking at Poland's highest levels. The vetoed bill would have created a mechanism for spending EU loans under the Security Action for Europe (SAFE) initiative, which is designed to boost Europe’s defense readiness.

Tusk condemned Nawrocki's veto as a betrayal of national interest, stating that the government will find alternative ways to access the funds. "A government meeting is imminent, during which the government will adopt a resolution on the basis of which we will finalise the Polish Armed Forces programme," Tusk told ministers, per Reuters. He also expressed confusion and concern over Nawrocki's decision.

The veto has intensified political rivalry between Tusk's pro-EU government and Nawrocki, who is backed by the nationalist opposition party Law and Justice (PiS). PiS labelled SAFE a German plot to meddle in Polish affairs, which would saddle the country with debt and limit its flexibility on arms purchases. According to Reuters, President Nawrocki said in a televised address that he vetoed the bill because it would leave future generations of Poles paying huge amounts of interest to Western banks.

The government has rejected an alternative proposal by Nawrocki, which involves using unrealized profits from the rising value of the central bank's gold reserves to fund defense. Tusk's government says SAFE provides financing at low interest rates and is essential to Poland's security in the face of what it views as a rising threat from Russia.

The veto will hamper investment in the domestic defence industry, according to Reuters. The bill would have enabled the state development bank BGK to operate a fund to disburse the cash. Now, the government will have to use an existing Armed Forces fund whose rules mean it will be unable to disburse some 7 billion zlotys ($1.87 billion) that had been earmarked for the border guard and the police.

The European Commission spokesman said on Friday that the EU was determined to continue implementing the plans it had made with Poland “without delay.” An advance payment could be made as early as April, according to AP News. The U.S. has also openly criticized SAFE, expressing concerns about how such initiatives restrict market access for American companies.