Finance Minister Belka resigns, as government accepts budget for 2003

Finance Minister Marek Belka resigned yesterday. This news was totally unexpected and came as a shock to all. The Minister said he was resigning for personal reasons only. During a press conference he told reporters, "After eight months as finance minister I am burned out". However, Belka was regarded as an advocate of spending restraint, and his resignation came after the Cabinet approved a 2003 budget deficit of zl. 43 billion, above the zl. 40 billion target set earlier. It seems that the government did not want to make further budget cuts and risk losing even more popularity, particularly as local elections are due in the fall. Insiders said that there was a major row between Belka and Prime Minister Leszek Miller in government offices yesterday. In addition, Belka was regarded as a bit of an outsider, he used to advise President Aleksander Kwasniewski and was never quite accepted by the faction loyal to Leszek Miller. Premier Miller has still not nominated a new minister. Sales on Financial markets increased but did not panic once the official news broke. Janusz Jankowiak, an economist with BRE Bank said, "The results of this decision will be what the government has wanted, which is the further weakening of the zloty and an exit by portfolio investors. This is a negative event, which will tarnish Poland's image". Meanwhile, Amir Ben-Gacem, an analyst with HSBC in London, and quoted by Reuters said, "It is going to affect the credibility of the government and the sustainability of their policies. When they have just announced their budget figures, and a minute afterwards you have the finance minister resigning, that puts a big question mark over how the figures were drawn up". (Reuters)