Analysts call for more details on reform plan
During the past week, Prime Minister Wlodzimierz Cimo-szewicz has promised to set priorities this year in safety, education, health service reform and rural development. Cimoszewicz also has pledged to maintain the pace of privatization and to push for fast-track legislative approval of the social insurance reform package now before Parliament.
"Cimoszewicz said all the right things we wanted him to say," said Markus Rodlauer, International Monetary Fund senior representative to Poland. "But it was too general to make any evaluations. We look forward to cooperation, both with him and his government, over the details."
Other analysts were more skeptical.
"The new prime minister's speech was more political than economic," said Leslaw Paga, chairman of Big Six accounting firm Deloitte & Touche. "He mentioned social insurance reform in one sentence, but set health service reform as a government priority."
Paga said that structural changes such as pension reform should be higher on the government's priority list, rather than the more populist health-care agenda.
Paga and others took issue with the government chief's statement to look more closely at the activity of National Investment Fund managing companies as well as their supervisory boards.
"Cimoszewicz's statement on privatization was not firm enough," Paga said. "On one hand he is for it, but on the other hand, he announces launching new controlling measures to monitor managing companies' activity."
While some NIF management teams expressed concern over Cimoszewicz's intended scrutiny of NIF activity, they don't think it will slow down the Mass Privatization Program (MPP).
"This is highly impossible," said Adam Murza, chief operating officer for BRE Giro Credit Management, NIF No.1's managing company. "But a certain nervousness has been created."
Murza said investment funds expected to be monitored. "This is a concern to the less efficient managing companies and water off a duck's back to the ones who are doing OK."
Jan Waluszewski, deputy president of NIF No. 13's supervisory board, agreed that an NIF review would not adversely affect MPP progress.
"NIFs are an experiment, and it is only natural that such an experiment has to be revised from time to time," he said.
Earlier this week, Cimoszewicz endorsed Package 2000, a mid-term economic plan outlined by Finance Minister Grzegorz Kolodko. The strategy calls for an 8% reduction in corporate taxation to 32%, reducing inflation by 5% and maintaining gross domestic product growth above 5% by year 2000.
Inflation reached 21.6% last year, while GDP growth reached 6.8%. However, GDP growth is expected to fall below the 6% level on the heels of anticipated recession in Western markets, and January's inflation figure ran higher than expected.
Package 2000 has been approved by the Economic Committee of the Council of Ministers (KERM) and awaits further analyses and fine tuning before heading for final government approval. Government officials said they didn't expect passage before the end of March.
"This is a very good and very ambitious program," Cimoszewicz said. "It says what has to be done, what are the goals we aim at. Now we have to tell how to do it and what are expected social costs."
He also said he was confident in gaining entrance by year's end to the Organization for Economic Cooperation and Development.
"This has already been decided," he says. "All we have to do is to introduce some changes into Polish law." Cimoszewicz promised more details on his government's program by month's end.
OECD officials put Poland's application on hold earlier this month at a Paris meeting, citing slow progress in reforms. During that same meeting, OECD gave Hungary the nod to enter the 26-country group. The Czech Republic became an OECD member late last year.
"Cimoszewicz said all the right things we wanted him to say," said Markus Rodlauer, International Monetary Fund senior representative to Poland. "But it was too general to make any evaluations. We look forward to cooperation, both with him and his government, over the details."
Other analysts were more skeptical.
"The new prime minister's speech was more political than economic," said Leslaw Paga, chairman of Big Six accounting firm Deloitte & Touche. "He mentioned social insurance reform in one sentence, but set health service reform as a government priority."
Paga said that structural changes such as pension reform should be higher on the government's priority list, rather than the more populist health-care agenda.
Paga and others took issue with the government chief's statement to look more closely at the activity of National Investment Fund managing companies as well as their supervisory boards.
"Cimoszewicz's statement on privatization was not firm enough," Paga said. "On one hand he is for it, but on the other hand, he announces launching new controlling measures to monitor managing companies' activity."
While some NIF management teams expressed concern over Cimoszewicz's intended scrutiny of NIF activity, they don't think it will slow down the Mass Privatization Program (MPP).
"This is highly impossible," said Adam Murza, chief operating officer for BRE Giro Credit Management, NIF No.1's managing company. "But a certain nervousness has been created."
Murza said investment funds expected to be monitored. "This is a concern to the less efficient managing companies and water off a duck's back to the ones who are doing OK."
Jan Waluszewski, deputy president of NIF No. 13's supervisory board, agreed that an NIF review would not adversely affect MPP progress.
"NIFs are an experiment, and it is only natural that such an experiment has to be revised from time to time," he said.
Earlier this week, Cimoszewicz endorsed Package 2000, a mid-term economic plan outlined by Finance Minister Grzegorz Kolodko. The strategy calls for an 8% reduction in corporate taxation to 32%, reducing inflation by 5% and maintaining gross domestic product growth above 5% by year 2000.
Inflation reached 21.6% last year, while GDP growth reached 6.8%. However, GDP growth is expected to fall below the 6% level on the heels of anticipated recession in Western markets, and January's inflation figure ran higher than expected.
Package 2000 has been approved by the Economic Committee of the Council of Ministers (KERM) and awaits further analyses and fine tuning before heading for final government approval. Government officials said they didn't expect passage before the end of March.
"This is a very good and very ambitious program," Cimoszewicz said. "It says what has to be done, what are the goals we aim at. Now we have to tell how to do it and what are expected social costs."
He also said he was confident in gaining entrance by year's end to the Organization for Economic Cooperation and Development.
"This has already been decided," he says. "All we have to do is to introduce some changes into Polish law." Cimoszewicz promised more details on his government's program by month's end.
OECD officials put Poland's application on hold earlier this month at a Paris meeting, citing slow progress in reforms. During that same meeting, OECD gave Hungary the nod to enter the 26-country group. The Czech Republic became an OECD member late last year.
