Gronicki survives
Opposition parties came well short of the 231 votes needed to dismiss Finance Minister Mirosław Gronicki at last week's parliamentary vote of confidence, leaving him in place to work on next year's budget.
"This was a relief, on the other hand I was already thinking about holidays and now I will have to work on the budget," Gronicki told reporters.
Whether that budget will come to life is anyone's guess, as the final decisions on next year's budget will be made by whoever wins the September 25 parliamentary elections, which Gronicki's party, the SLD, is expected to lose.
Gronicki is respected in financial markets for his determination to reform public finances in time to enter the eurozone before 2010. However, his plan to raise exise tax on heating oil by 400 percent - which didn't include a strategy for household relief during the long, cold Polish winter - prompted calls for his sacking. The plan has since been withdrawn.
Currency markets reacted coolly to the news. The złoty's value dropped slightly ahead of the debate, as those who expected Gronicki's removal from office sold off their Polish currency. After the vote however, the złoty held steady.
"This was broadly expected by markets, but some people had sold on worries he could go, so we may see some minimal gains for the złoty as a result," said Ryszard Petru, chief economist at Bank BPH, adding: "Against a parliament threatening to raise spending ahead of elections, Gronicki is seen as a guarantee of reasonably sensible, stable policy and good debt management, minimalising costs for the budget." (Reuters)
"This was a relief, on the other hand I was already thinking about holidays and now I will have to work on the budget," Gronicki told reporters.
Whether that budget will come to life is anyone's guess, as the final decisions on next year's budget will be made by whoever wins the September 25 parliamentary elections, which Gronicki's party, the SLD, is expected to lose.
Gronicki is respected in financial markets for his determination to reform public finances in time to enter the eurozone before 2010. However, his plan to raise exise tax on heating oil by 400 percent - which didn't include a strategy for household relief during the long, cold Polish winter - prompted calls for his sacking. The plan has since been withdrawn.
Currency markets reacted coolly to the news. The złoty's value dropped slightly ahead of the debate, as those who expected Gronicki's removal from office sold off their Polish currency. After the vote however, the złoty held steady.
"This was broadly expected by markets, but some people had sold on worries he could go, so we may see some minimal gains for the złoty as a result," said Ryszard Petru, chief economist at Bank BPH, adding: "Against a parliament threatening to raise spending ahead of elections, Gronicki is seen as a guarantee of reasonably sensible, stable policy and good debt management, minimalising costs for the budget." (Reuters)
