WORLD TRADE
ORGANIZATIONG/SCM/N/48/POL
3 February 2000
(00-0424)
Committee on Subsidies
and Countervailing MeasuresOriginal:  English
SUBSIDIES
Updating Notifications Pursuant to Article XVI:1 of
the GATT 1994 and Article 25 of the SCM Agreement
POLAND
The following communication, dated 31 January 2000, has been received from the Permanent
Mission of Poland.
_______________
The following notification covers the specific subsidies  applied in Poland in 1998 in the
industrial and agricultural sectors.
All data concerning the amounts of subsidies contained herein are given in New Polish
Zlotys (PLN).1
TABLE OF CONTENTS
Page
A. SUBSIDIES APPLIED IN 1998 IN  THE INDUSTRIA L SECT OR ..................................2
1. Loans from EFSAL Funds................................................................................................2
2. Investment Tax Reductions ..............................................................................................3
3. Direct Grants for Extra Charges to Products and Services ..........................................3
4. Assistance for Restructuring of the Banking Sector ......................................................4
5. Reduction of Liabilities Resulting from Social Insurance Premiums...........................46. Guarantees and Warrants of the Treasury.....................................................................4
7. Credit Warrants for Small and Medium Enterprises....................................................4
8. Support of Regional Programmes....................................................................................5
9. Restructuring Programme for Steel and Iron Industry.................................................7
10. Restructuring Programme for Mining Sector ................................................................8
                                                     
1 *In 1998, the average exchange rate between the Polish Zloty and the US dollar was: 1 PLN =
0.268 USDG/SCM/N/48/POL
Page 2
11. Tax Incentives ............................................................................................................. ......9
12. Support for Special Economic Zones.............................................................................10
B. SUBSIDIES SUPPORT ING EXPO RTS ..........................................................................11
1. Insurance System Supporting Export Contracts, Guaranteed by the Treasury.......11
2. Investment Related Tax Rebate Connected  with Results of Export Activities..........11
C. SPECIFIC SUBSIDIES APPLIED IN  THE AGRICULTU RAL SECT OR .....................12
1. Grants for Supporting Production of Calcium Fertilizers ..........................................12
2. Financial Support for Sugar Export..............................................................................12
3. Subsidizing of Interests on Banking Loans for Agricultural Purposes ......................13
4. Working Capital Loans...................................................................................................13
5. Investment Loans ............................................................................................................1 3
6. Intervention Purchase of Food and Agricultural Products by the Agricultural
Market Agency (AMA) ...................................................................................................14
THE GRAIN MARKET ..............................................................................................................14
THE BEE HONEY MARKET ....................................................................................................15
7. Grants for Biological Progress in Agriculture..............................................................15
A. SUBSIDIES APPLIED IN 1998 IN THE INDUSTRIAL SECTOR
1. Loans from EFSAL Funds
Amount  of  assistance granted
In 1998 the total assistance provided amounted to PLN 53.56 million, including:
grants – PLN 14.75 million, and loans – PLN 38.81 million.
As per the end of 1998 approximately 86 per cent of the EFSAL loans were consumed.
Beneficiaries
In thousands PLN
No
.Branch of economy Total
assistance
granted
in 1998Grants LoansGlobal
assistance
structure
1. Food industry 636.1 636.1 - 1.2%
2. Pulp and paper industry 10 415.5 115.5 10 300.0 19.4%
3. Chemical industry 5 499.9 499.9 5 000.0 10.3%
4. Light industry 2 487.9 2 487.9 - 4.7%
5. Construction 2 223.5 223.5 2 000.0 4.2%
6. Metallurgy 6 500.0 6 500.0 - 12.1%
7. Machine industry 12 330.3 1 280.3 11 050.0 23.0%
8. Services 2 000.0 - 2 000.0 3.7%G/SCM/N/48/POL
Page 3
9. Transport 11 461.8 3 006.8 8 445.0 21.4%
Total 53 555.1 14 750.1 38 805.0 100%
2. Investment Tax Reductions
Legal basis  – supplement
Until 31 December 1998 the taxpayers could obtain the right for deducting the investment
expenditures from the income and tax abatements in the municipalities (gminas) especially
endangered with high structural unemployment on the basis of Regulation of the Council of Ministers
of 24 January 1995  (art. 6.2 of the Act of 21 November 1996 concerning changes in the Act on
Corporate Income Tax - Journal of Laws No 137, item 639). The taxpayers having obtained thoserights till 31 December 1999 maintain them within the period of time and range regulated by the
above rules.
Amount  of  assistance granted
(i) In 1998 the tax relieves resulted from the provisions of the Council’s of Ministers regulation
of 24 January 1995 concerning deductions of the investments expenditures from the income
and reduction of the income tax rates in the municipalities especially endangered with high
structural unemployment amounted to PLN 10.1 million
(ii) In 1998 the tax relieves resulted from the provisions of the law of 15 February 1992
concerning  the Corporate Income Tax amounted to PLN  1 486.4 million.
Beneficiaries
Legal and natural persons. Every taxpayer conducting economic activity can be eligible
under the scheme if criteria of the above mentioned acts are met.
3. Direct Grants for Extra Charges to Products and Services
Amount of assistance granted
In 1998 the grants amounted to PLN 752.6 million.
Beneficiaries
Pursuant to At. 19 of the state budget for 1998 – and similarly during the proceeding years –
the grants were  awarded for:
I millions of PLN
Meals sold in milk bars
Passenger domestic railway transport
Passenger inter-city bus transport, including grants for inter-city connections in
the urban agglomeration of Katowice orga nized (delegated) by local governments,
and municipal associations
Publication of specialized school and university books17.0
560.0
164.0
11.6G/SCM/N/48/POL
Page 4
4. Assistance for Restructuring of the Banking Sector
In 1998 no state aid granted for restructuring the banking sector either within the framework of
previously notified programmes or the new ones.
5. Reduction of Liabilities Resulting from Social Insurance Premiums
In 1998 no state aid granted for restructuring of the debts of state own enterprises and
companies with the Treasury capital share, resulted from non-payment of the contributions for the
social insurance.
6. Guarantees and Warrants of the Treasury
Amount of  assistance granted
In 1998 one enterprise obtained guarantees to repay the local loans in total value of PLN 39.0
million.  Three other businesses obtained the treasury guarantees to repay international loans totaling
PLN 351.9 million.
The total amount of treasury guarantees extended in 1998 is PLN 390.9 million.The expenditures incurred by the Treasury in 1998 resulted from the extended guarantees for
defaulted local loans amounted to PLN 130.5 million, including repayment of the principals totaling
PLN 70.4 million and interests PLN 60.1 million.
The expenditures resulted from the defaulted international loans guaranteed and repaid by the
Treasury in 1998 amounted to PLN 0.6 million, including PLN 0.5 million for repayment of the
principal and PLN 0.1 million for interests.
Beneficiaries
The guarantees and warrants extended by the Treasury in 1998 covered the banking loans for
financing the following undertakings (within the total amount of the guarantees and warranties
extended by the Treasury):
• three investments in infrastructure of food and agricultural sector
• one investment in modernization of  the energy sector50.2%
49.8%
7. Credit Warrants for Small and Medium Enterprises
Amount of assistance granted
In 1998 Bank Gospodarstwa Krajowego (BGK) extended 186 loan guarantees totaling
PLN 71.4 million.
Beneficiaries
Currently any Polish business may apply to BGK for loan guarantee, irrespective of volume
of its income and employment level.  Any investment loan or loan for purchase of productionmaterials or raw materials . The guarantees are provided up to 60 per cent of the used portion of the
extended loan, and up to 60 per cent of the corresponding interests, or up to 70 per cent of the
principal excluding the interests.G/SCM/N/48/POL
Page 5
The maximum guaranteed amount must not exceed ECU 1.5 million.  The guarantee is
extended after the debtor has provided the guaranto r with collateral in the form of a blank bill of
exchange or additionally if so required by the bank other collateral determined by BGK. Businesses
pay a fee for extending the guaranty, however BGK may charge a not more than 2 per cent of the
guarantee value.  Guarantees may be obtained directly from BGK or through one of 33 banks whichhave concluded cooperation agreements with BGK (altogether 760 branches).
BGK may extend guarantees for banks loan portfolio of which the loans would be provided
for local businesses employing up to 250 persons and whose annual income does not exceed
ECU 20 million, and balance sheet total does not exceed ECU 10 million.  The amount of a single
guarantee within the portfolio must not exceed ECU 50 thousand, and must not exceed 50 per cent of
the loan.
In 1998 the deadline for submitting the applications concerning loans for financing repairs
and reconstruction of buildings and production asse ts and purchase of production and raw materials
in connection with liquidation of the effects of 1997 floods was prolonged until 31 December 1998.
8. Support of Regional Programmes
2
8.1. Purpose of the programme
Increased financing of investments in restructuring and infrastructure in some regions of the
country.
8.2. Legal basis
(i) Art. 37i, items 1 and 2 and art. 37h, item 2 of the Act of 14 December 1994 concerning
employment and protection against unemploymen t (Journal of Laws of 1997 No 25, item
128, No 41, item 255, No 63, item 403, No 93, item 569, No 107, item 692, No 121, item
770, No 123, item 776;  and of 1998 No 66, item 431, No 106, item 668, No 108, item 684,
No 137, item 887, No 162, items 1112, 1118, 1126 ).
 
(ii) Art. 25, item 2 of the 1998 budget (Journal of Laws No 28, item 156).
 
(iii) Regulation of the Council of Ministers of 30 April 1996 concerning procedures and
conditions for awarding grants from the state budget for increased funding of investments in
infrastructure implemented within the system of public works as own responsibilities of the
municipalities especially endangered with high level of structural unemployment (Journal of
Laws No 56, item 253; of 1997 -  No 110, item 720; and of 1998 - No 81, item 524).
 
(iv) Regulation of the Council of Ministers of 2 June 1998 concerning scope procedures and
conditions of supporting implementation of regional restructuring programme with the 1998
budget resources and establishing of local in stitutions (Journal of Laws No 76, item 492).
8.3. The government agency responsible for the programme implementation
The Minister of Labour and Social Policy
The Minister of Finance and relevant Voivods.
                                                     
2 Due to changes in the scheme comparing with the previous year notification complete  programme is
pesented.G/SCM/N/48/POL
Page 6
8.4. Form of the assistance
Grants from the state budget.
8.5. Basic characteristics
I(I) In 1998 restructuring investments categorized in the following regional programmes were
supported financially with grants from the state budget:
1. Programme of strategic development  for the Voivodship of Elblag
2. Programme of strategic development  for the Voivodship of Koszalin
3. Programme of strategic development  for the Voivodship of Olsztyn4. Programme of strategic development  for the Voivodship of S łupsk (1997-2002)
5. Programme of strategic development  for the Voivodship of Suwal łi (1997-2002)
6. Programme of strategic development  for the Voivodship of Łódź
7. Programme of strategic development  for the Voivodship of Wa łbrzych
8. Programme of strategic development  for the Voivodship of Katowice
(ii) Grants from the state budget for financing of investments in infrastructure implemented
within the system of public works as own responsibilities of the municipalities especially
endangered with high level of structural unemployment were projected for investments
concerning water, energy and heat supply, sewage and municipal water treatment plants,sanitary appliances, waste disposal and recyclin g, municipal roads and streets, gas pipelines
and gas processing plants and sport and recreations utilities.
8.6. Amount of  assistance granted
(i) In 1998 PLN 59.6 million was expended for financing of regional programmes. In the state
budget for 1999 PLN 62.7 million was earmarked for this purpose.
(ii) Grants for financing of investments in infrastructure implemented within the system of public
works as own responsibilities of the municipalities especially endangered with high level of
structural unemployment amounted in 1998 to PLN 65.0 million. In the state budget for 1999
PLN 50.3 million was earmarked for this purpose.
8.7. Duration of the programme
(i) The provisions of Regulation of the Council of Ministers of 2 June 1998 concerning scope,
procedures and conditions of supporting implementation of regional restructuring programmewith the 1998 budget resources and establishing of  local institutions (Journal of Laws No 76,
item 492) were binding in 1998 only.  Implementation of regional restructuring programmes
shall be also supported with the resources from the state budget for 1999 but  procedures and
conditions of this support shall be determined by the new Regulation of the Council of
Ministers in this respect.
(ii) Financing by the resources from the state budget of investments in infrastructure
implemented within the system of public works as own responsibilities of the municipalities
especially endangered with high level of structural unemployment, as stated in  the
Regulation of the Council of Ministers of 30 April 1996  is in force in the period of 1996-1999.G/SCM/N/48/POL
Page 7
8.8. Beneficiaries
(i) In 1998 of PLN 59.6 million expended for financing of investments determined in regional
restructuring programmes 62.2 per cent was expended for financing  own investments of
municipalities, 13.4 per cent for financing investments of economic entities, 18.1 per cent forfinancing  investments carried out by other organizational units and 6.3 per cent for shares in
enterprises engaged in local development programmes in the Voivodship of Katowice.
(ii) PLN 65.0 million of grants from the state budget for financing of investments in
infrastructure implemented within the system of public works as own responsibilities of the
municipalities especially endangered with high level of structural unemployment was
provided exclusively for increased financing of own investments of municipalities in18 Voivodships.
8.9. Evaluation of the effects on trade
No impact on the foreign trade.
9. Restructuring Programme for Steel and Iron Industry
3
9.1. Purpose of the programme
- improvement of economic effectiveness of steel and iron production through the technology
modernization (increase share of continuous steel founding processes from 8 per cent to 90 per
cent) and adjusting the production potential an d employment level to the market requirements
(decrease of  annual foundry iron production  from 19 to 13.5 million tons, and employment
reduction from 147 to 43.5 thousand persons).
 
- adjusting the products range and quality to the current market demands,
 
- protection of the environment against damages caused by steel industry.
 
 9.2. Legal basis
Programme of restructuring of steel and iron industry accepted by the Council of Ministers
on 30 June 1998.
 
 9.3. The government agency responsible for the programme implementation
 
 The Minister of Economy.
 
 9.4. Form of the assistance
 
 Government loans guarantees, grants.
 
 9.5. Basic characteristics
 
 Total cost of restructuring of steel and iron sector in Poland is estimated for PLN 12 billion
including PLN 8.4 billion for investments,  PLN 265 million for environmental protection, PLN 800
million for social protection, remaining funds for increase of working capital of enterprises.
 
                                                     
3 Due to changes in the scheme comparing with th e previous year notification complete programme is
pesentedG/SCM/N/48/POL
Page 8
 The sources of funds shall be as follows :
 
 - steelworks' own resources and strategic investors,
 - external financial aid (ex. PHARE)
 - issue of shares and bonds
 - environmental protection funds
 - bank loans
 - budget grants
 
 9.6. Amount  of  assistance granted
 
 In 1998 no state aid granted. Grants for social protection of employment restructuring shall
be granted from 1999.
 
 9.7. Duration  of the programme
 
 The programme of steel and iron industry restructuring covers the period of 1998-2005.
 
 9.8. Beneficiaries
 
 In 1998 no beneficiaries of subsidies in steel and iron sector.
 
 9.9. Evaluation of the effects on trade
 
 Due to the lack of subsidies no effects on foreign trade.
  
Utilization of other financial resources due to the range of undertakings concerning mainly
raw material production of the steelworks also did not affect foreign trade.
10. Restructuring Programme for Mining Sector
 Legal basis - supplement
 
- The 1998 state budget (Journal of  Laws No 28, item 156),
 
- Regulation of the Minister of Economy of 8 May 1998 concerning detailed  rules, procedures and
way of awarding and use of grants for mining,
 
- Regulation of the Minister of Economy of 8 May 1998 concerning conditions to obtain
entitlements, ways of calculation, detailed rules and procedures of payment in 1998 of socialprotection allowances related to miners’ vacations, social welfare and one time allowances for
underground employees of mining sector.
 Amount of assistance granted
 
 Direct assistance in 1998:
 
 Hard coal mining:
 
- grants for physical liquidation of the coal mines
- increased funding for alleviation of mining damages
- liabilities towards creditors
- necessary expenditures  after liquidation of mines
- grants for employment restructuring including :PLN 166.3 million
PLN 28 million
PLN 1.46 million
PLN 50.14 millionG/SCM/N/48/POL
Page 9
• creation of new jobs,
• transfers and retraining,
• claims of former employees,
• social protection allowances for dismissed employees,
• remuneration in cash for dismissed workersPLN 755 million
Grants from the state budget for financing of central government investments in 1998:
- total amount for hard coal mining PLN 15.43 million
Mining of salt, sulfur and other minerals:
- total amount of grants: PLN 143.15 million
Beneficiaries
The following entities of the hard coal mining sector obtained the assistance:
Type of grant Number  of
entitiesAverage grant per
grantee
(in millions PLN)
liquidation of mines
mining damages alleviation
liabilities towards the creditorsnecessary expenditures
 after liquidation of mines
grants for employment
restructuring37
26
2
18
774.5
1.1
0.72.8
9.8
In the sector of mining of salt, sulfur and other minerals in 1998 the grants were awarded to 8
entities, average grant was PLN 17.9 million
11. Tax Incentives 
4
11.1. Purpose of the programme
Protection of enterprises against bankruptcy or liquidation.
11.2. Legal basis
Law of 29  August 1997 concerning tax liabilities (Journal of Laws No 137, item 926 with
later changes)
11.3. The government agency responsible for the programme implementation
The Minister of Finance and the tax authorities.
                                                     
4 Due to changes in the scheme comparing with the previous year notification complete  programme is
pesentedG/SCM/N/48/POL
Page 10
11.4. Form of the assistance
Remission of tax wholly or partially, deferring tax payments and providing possibility to pay
the taxes in installments, forgiveness of overdue taxes wholly or partially.
11.5. Basic characteristics
 The law regulates the rules concerning the emergence, execution and termination of tax
liabilities.  In some economically and socially justified cases, the Minister of Finance may order not
to determine the tax value wholly or partially and resign from the tax enforcement.  Following the
application of taxpayer the deadline for tax payment may be deferred or the payment may be divided
into installments.
In some economically and socially justified cases, the overdue taxes or interests on delayed
payments may be  wholly or partially forgiven (together with the interests on the delayed payment)
by the Minister of Finance of by other tax authority.
11.6. Amount  of  assistance granted
 
 Value of the abolished current taxes obligation:   from corporate entities - PLN 38.5 million
 from natural persons - PLN 24.2 million.
Value of the abolished overdue taxes - total amount PLN 211.1 million including:
lifted taxes - PLN 10.0 million
corporate income tax - PLN 190.5 million
personal income tax - PLN 19.6 million
Total amount of deferred tax payments and tax payments in installments - PLN 324.3 million
including :
lifted taxes - PLN 10.9 million,
corporate income tax - PLN 188.4 million,
personal income tax - PLN 125.0 million.
11.7. Duration  of the programme
No time limits established
11.8. Beneficiaries
Natural and legal persons; any taxpayer may apply for tax relief.
11.9. Evaluation of the effects on trade
Considering the purposes of this programme, there is no direct impact on the foreign trade.
12. Support for Special Economic Zones
Amount  of  assistance granted
In 1998 the tax exemptions were granted in three of the Zones.  he assistance amounted to
PLN 27 817 thousand including :G/SCM/N/48/POL
Page 11
- PLN 4 594 thousand in Special Economic Zone of Suwa łki
- PLN 18 657 thousands in Special Economic Zone Euro Park  Mielec
- PLN 4 566 thousand in Special Economic Zone of Katowice
Beneficiaries
The number of entities which became eligible for the scheme (registered their economic activity in
the zones) till the end of 1998 for all Zones respectively is as follows :
Special Economic Zone Euro Park Mielec  36
Special Economic Zone of Suwa łki  43
Special Economic Zone of Katowice  31Special Economic Zone of Legnica     5
Special Economic Zone of Łódź       9
Special Economic Zone of Wa łbrzych 15
Special Economic Zone of Tarnobrzeg       9
Special Economic Zone of Tczew     1Special Economic Zone of Kostrzy ń-Słubice       1
Special Economic Zone of Warmia and Maury Region     1
Special Economic Zone of S łupsk   2
Special Economic Zone of Kamienna Góra   2
Special Economic Zone of Starachowice   6
B. SUBSIDIES SUPPORTING EXPORTS
1. Insurance System Supporting Export Contracts, Guaranteed by the Treasury
Amount of  assistance granted
In 1998 the Export Credits Insurance Corporation  did not use any forms of the state
assistance, i.e. neither loans from the state budget resources nor banking loans guarantees to secure
the credits contracted by the Corporation.  Own reso urces of the Corporation were sufficient for the
insurance.  46.4 per cent, i.e. PLN 1 565.5 mln. of the PLN 3 400 mln. limit for insurance of export
contracts determined in the 1998 budget was consumed.
Beneficiaries
The Export Credits Insurance Corporation is the direct beneficiary of the assistance while
businesses using this form of assistance are indirect beneficiaries.
2. Investment Related Tax Rebate Connected with Results of Export Activities
Amount of  assistance granted
It is difficult to evaluate the volume of the provided assistance since only the aggregated data
are available covering all kinds of investment allowances resulted from the provisions of the Act of
15 February 1992 concerning  corporate income tax (Journal of Laws of 1993 No 106, item 482,No 134, item 646 of 1994 No 1, item 2;  No 43, item 163, No 80, item 368, No 87, item 406, No 90,
item 419;  No 113, item 547;  No 123, item 602; No 127, item 627, of 1995 No 5, item 25; No 86,
item 433; No 96, item 478; No 133, item 654; No 142, item 704 of 1996 No 25, item 113;  No 34,
item 146;  No 90, item 405;  No 137, item 639 ; No 147, item 686; and of  1997 No 9, item 44, No
28, item 153, No 79, item 484, No 96, item 592, No 107, item 685, No 118, item 754, No 121, item770, No 123, item 776 and 777, No 137, item 926, No 139, item 932, 933 and 934, No 140, item 939,
No 141, item  943 and 945) including those related to export activities.G/SCM/N/48/POL
Page 12
The total amount of investment allowances in 1998 was PLN  1 468.4 million ( see A.2 (ii) )
Beneficiaries
The investment allowances are granted to all taxpayers who meet the criteria determined by
the law of 15 February 1992 concerning corporate income tax, not just those businesses conducting
export activities.  The basic condition to be eligible for allowances is incurring investment expenses
determined in details by the regulations, not the export activity.
C. SPECIFIC SUBSIDIES APPLIED IN THE AGRICULTURAL SECTOR
1. Grants for Supporting Production of Calcium Fertilizers
Characteristics of the programme - supplement.
In 1998 the state assistance subsidizing production of calcium fertilizers was continued
(subsidizing of the production costs and sales).  The subsidies are aimed at reducing the price of this
type of fertilizers to enable applying them by broad range of Polish farmers.  The assistance isjustified by the need to deacidify considerable part of arable land (acidification of the soil adversely
influences the crops) on one hand, and on the other hand it is granted due to the low profitability of
large part of the farms, which  prevents them to purchase calcium fertilizers at their full price.
The state assistance involves grants awarded to the fertilizers' producers, proportionally to
the number of tons of pure CaO and MgO in the volume of the produced and sold fertilizers.  Despite
the fact that the assistance was granted directly to producers of the fertilizers, it supports farmers by
allowing them purchase of the fertilizers at lower price.
In 1998 as an experiment, on the basis of Regulation of the Minister of Agriculture, there has
been implemented the rule of granting an above mentioned subsidy directly to the farmers buying
fertilizers at the market price.  This method was used in 7 (of total 49) administrative regions of the
country.
Amount  of  assistance granted
In 1998 the grants from the state budget amounted to PLN 98 155 thousand.
Beneficiaries
Subsidy was granted to all calcium fertilizers' producers except of those selling their products
in 7 regions where new method was applied.  In t hose regions farmers were direct beneficiaries.
2. Financial Support for Sugar Export
Amount  of  assistance granted
In 1998 the Agency for Agriculture Restructuring and Modernization supported the export of
sugar with the amount of PLN 45 960 mln.  for the exported volume of 135 566 tons.
Beneficiaries
According to the provisions of the law of 26 August 1994 the grants supporting sugar export
are awarded to the producers, i.e.  sugar-mills and Sugar Partnerships. In 1998, 69 producers received
subsidies for the exported sugar.G/SCM/N/48/POL
Page 13
3. Subsidizing of Interests on Banking Loans for Agricultural Purposes
Amount of assistance granted
Amount of PLN 244 thousand
Beneficiaries
Agricultural farms
4. Working Capital Loans
 Amount of  assistance granted
 
 In 1998 the Agency for Agriculture Restructuring and Modernization allocated resources for
additional payments to banks for:
 
- interests on loans for purchase of liquid production assets for agricultural production – PLN 259
232 thousand,
- interests on loans for purchase of  agricultural products and storage or purchase of periodical
surplus of agricultural products – PLN 231 682 thousand.
 Beneficiaries
 
- Domestic economic entities involved in the agricultural production may apply for loans for
purchase of liquid production assets for agricultural production.
- Domestic economic entities involved in food processing or food storage, pharmaceutical
processing and phloem fibres processing may apply for loans for purchase and storage ofagricultural products.
- Domestic economic entities involved in purchase storage and reproduction of seeds and seed-
potatoes, and performing activity connected with technological preparation of seeds and seed-
potatoes may apply for loans for purchase and storage of seed.
- Domestic economic entities producing or storing periodical surplus of powdered milk, butter,
hard cheeses, pork half-carcasses, and bee-honey may apply for loans for purchase and storage of
these products.
5. Investment Loans
Characteristics of the programme - supplement.
In 1998 Agency for Agriculture Restructuring and Modernization used to subsidize interests
on following investments credits granted in years 1994-1998 :
- basic investment loans for implementation of agricultural undertakings, food processing, special
agricultural production sectors and agricultural services,
- loans for purchase of  agricultural land,
- loans for establishing farms by persons not older than 40 years,
- loans for business sectors and regions  within the scope of programmes approved by the Minister
of Agriculture and Food Economy,
- loans for implementation of undertakings in agriculture  and special agricultural production
sectors aimed at utilization of  the existing production base of the farms and special agriculturalproduction sectors through starting up or increasing the production,G/SCM/N/48/POL
Page 14
- loans for implementation of undertakings in agriculture  and special agricultural production
sectors aimed at utilization of  the existing production base of the farms and special agricultural
production sectors through restarting the production  in these farms and special agricultural
production sectors after the break that lasted at least one year,
- application and increase the Agency subsidies for interest on investment loans for agriculture,
food processing  and agricultural services, extended  before coming into force of the Council’s of
Minister ordinance of January 30, 1996 concerning the specific directions of the actions of the
Agency for Agriculture Restructuring and Modernization and rules for implementation of these
actions,
- loans for undertakings generating new jobs for rural population in non-agricultural  sectors in
rural and rural/urban municipalities,
- loans for resuming the activity in the areas affected by  droughts, hails, excessive downfall of
rains or snow, floods, hurricanes, fire,  or  scourge of rodents,
- loans extended for creation of furnishing of a farm within the scope of the programme for
settlement on state owned farmlands approved by the Ministry of Agriculture and Food Economy
and Ministry of Finance
 
 Amount of  assistance granted
 
 In 1998 the Agency allocated PLN 583 903 thousand for subsidizing the interests on
investments loans.
 
 Beneficiaries
 
 The entities that may apply for loans subsidized interests to the Agency are:
 
- natural or corporate persons conducting activities in  agriculture and special agricultural
production,
- natural or corporate persons conducting or starting up business activities in the rural or
rural/urban municipalities.
6. Intervention Purchase of Food and Agricultural Products by the Agricultural Market
Agency (AMA)
THE GRAIN MARKETAmount of  assistance granted
In 1998 AMA purchased :
-  719.6 thousand tons of grain stored from the previous year for PLN 433.4 mln. which included :
- wheat - 561.9 thousand tons for PLN 360.4 mln.
- rye - 157.7 thousand tons for PLN 73.0 mln.
- 312.6 thousand tons of grain in direct purchase from 1998 harvest for PLN 148.3 mln. which
included :
- wheat - 239.5 thousand tons for PLN 122.1 mln.
- rye - 73.1 thousands tons for PLN 26.2 mln
- 1 223.5 tons of grain from 1998 harvest within the framework of surcharges for domestic
enterprises for PLN 113.8 mln which included :
- wheat - 1 049.5 tons for PLN 92.8 mln
- rye - 170.0 tons for PLN 10.2 mln
- extra surcharges for grain storage - PLN 10.9 mlnG/SCM/N/48/POL
Page 15
Beneficiaries
- Domestic producers of grains
- Consumers
THE BEE HONEY MARKET
(a) Amount  of  assistance granted
(b) In 1998 the total of 2 019 tons of bee honey was purchased  for PLN 13 198 thousand.
Beneficiaries
- domestic bee honey producers
- consumers
7. Grants for Biological Progress in Agriculture
Amount  of  assistance granted
In 1998 the grants totaled PLN 302.5 million, including:  plant production: PLN 124 million,
and animal breeding: PLN 178.5 million.
Beneficiaries
The grants are awarded to farmers and animal breeders as well as to entities involved in
implementation of the goals  related to biological progress in agriculture:
1. grants for animal breeding:
- animal breeders PLN 82.8 million
- entities PLN 95.7 million
2. grants for plant production:
- animal breeders PLN 48.2 million
      - entities PLN 75.8 million
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