Beware the ides of March

   Far right wing politicians and farmer trade-union leaders scored a key victory last week when the new treasury minister, Aldona Kamela-Sowinska, issued unambiguous guarantees that she would move decisively to create a national sugar holding, Polski Cukier.

   For more than two years, dogged proponents of the Polski Cukier concept just haven't taken no for an answer. To get their way, they have haunted the halls of the Treasury Ministry, sabotaged privatization initiatives, halted legislative work and rocked the shallow foundations of this government. Only two weeks ago, the day after Andrzej Chronowski resigned, Polski Cukier's chief advocate and head of the Sejm's agriculture committee, Gabriel Janowski, was removed from the former minister's office by force in the middle of the night, where he had been camped out "24/7" for almost two weeks.

   In the wake of Janowski's tragicomic extraction from her new office, Kamela-Sowinska last week emerged from the ministry's walls and speaking through a bullhorn promised hundreds of jeering pro-Polski Cukier ralliers that by the end of this month the ministry would announce, not if the concern would be formed, but how it would be organized.

   With that news the next chapter of the long saga of Poland's potentially powerful, but very beleaguered, sugar sector comes to a close. Before treasury officials and pro-Polski Cukier campaigners get too far in formulating the happy ending, they should bear in mind a couple of irritating facts that will continue to haunt the sector regardless of the direction the denouement of this sordid tale takes.

   Irritating fact No. 1: Poland's sugar sector is highly inefficient. Even die-hard Polski Cukier activists agree that the sector needs modernization and restructuring. Just how much work is needed is visible to the naked eye by comparing the state of the sector in the European Union (EU) to the one in Poland. As Freedom Union Deputy Jan Wyrowinski pointed out on public TV last week, 17 million tonnes of sugar are produced by 140 mills in the EU. In Poland, it takes 76 mills to produce just under 2 million tonnes.

   Irritating fact No. 2: Restructuring costs money, and money is something the sector has lacked for years. By the end of 1999, the sector had racked up debts surpassing zl. 2 billion ($513 million), still in state hands. Banks and other creditors are going to want to be compensated before they pay out more to fund an already faltering industry. Saint Louis Sucre pledged to invest more than zl. 400 million ($100 million) to cover debts and modernize the 16 mills included in Slaska Spolka Cukrowa, the holding the French company has been trying to buy for more than a year. Primitive calculations suggest that more than zl. 1 billion ($250 million) will be needed for the sector to stand on its feet and start competing on international markets.

   Kowtowing in the name of national interest won't make Polski Cukier work. What might make it work are calculators, spreadsheets, good agricultural practices and savvy managerial decisions, something blazingly absent to date in the ardent politicking that led up to last week's Polski Cukier triumph.