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Poland Preparing Budget for Euro Plans
Poland's finance minister said Tuesday that his office's budget draft for 2005 aims to reduce the target deficit by about 10 percent in an effort to meet the requirements to adopt the euro.
The new plan is to hit 35 billion zlotys ($9.7 billion; euro7.9 billion), down from an earlier draft that foresaw a deficit of 38.8 billion zlotys ($10.7 billion; euro8.8billion).
"This is a significant tightening of fiscal policy," Finance Minister Miroslaw Gronicki told reporters. "We are trying to tighten it to meet the (euro) convergence criteria as planned, in the year 2007."
Poland joined the European Union in May.
Gronicki said the draft, which will be submitted for government approval next month, foresees an average annual inflation rate of 3 percent - a bit higher than the 2.8 percent expected in an earlier draft this summer.
Those figures were disputed by the central bank, which said earlier in the day that there is a 30 percent chance inflation would exceed 6 percent in the first quarter of 2005.
Gronicki said the 2005 draft also aims to bring unemployment down to 18.2 percent by the end of next year, from 19.3 percent expected at the end of 2004.
Also Tuesday, Deputy Finance Minister Elzbieta Suchocka-Roguska said that this year's budget deficit is expected to be 2 billion zlotys ($555 million; euro454 million) lower than the 45.3 billion zlotys ($12.6 billion; euro10.3 billion) earlier predicted.
The Cabinet of Prime Minister Marek Belka must approve the draft by the end of September and submit it to the parliament for discussion and the final go-ahead.
(Source: http://www.forbes.com/home/feeds/ap/2004/08/31/ap1524811.html) |
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