Poland's Prime Minister Donald Tusk on Thursday threatened to drop a Chinese company contracted to build a key stretch of highway in Poland after financing problems saw the work grind to a halt.

"This contractor has problems with financing and today I'll be speaking with (Infrastructure) Minister (Cezary) Grabarczyk (...) about how to proceed if we decide to resign from the services of this company so that work on the A2 highway project isn't drastically delayed," Tusk said, adding "we don't want a situation where the project costs sky-rocket."

Construction of part of the A2 highway linking the Polish and German capitals Warsaw and Berlin by Chinese company COVEC stopped last month after the firm failed to pay Polish subcontractors.

In September 2009 COVEC -- the China Overseas Engineering Group Company -- beat several European competitors in the race to build 49 kilometres (30 miles) of the A2 motorway.

The deal was a watershed, with experts underlining that it was the first large-scale Chinese construction and public works operation in the European Union.

COVEC bid to do the work for 1.3 billion zloty (330 million euros, 472 billion dollars), considered a very low price, an issue which sparked accusation of dumping from competitors.

COVEC's winning bid was half the estimated cost of the tender.

"Minister Grabarczyk took a certain risk deciding to cooperate with a new partner on the Polish and European market, (...) a Chinese firm," the Polish prime minister said Thursday.

In May after work had stopped on the project, Grabarczyk expressed incredulity that "a Chinese group, for which the contract for the A2 motorway is a sort of entry-pass to the vast EU infrastructure market, wants to put at risk its future on the European market."

The construction is part of Poland's ongoing issuing of tenders as it strives to upgrade its infrastructure in time to co-host the high-profile 2012 European football championships along with neighbouring Ukraine.

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