IMF praises government's labor reform plans, calls for end to attacks on NBP

The International Monetary Fund (IMF) believes Poland will soon enjoy an economic recovery, with GDP growth likely to reach 4% to 4.5% after 2002. This year the forecast is for growth of between 1% and 1.5%, but the situation is expected to improve thanks to already completed reforms and the prospects for European Union (EU) membership. In its report, issued at the end of a two-week mission to Poland, the IMF praises the government for its plans for reforming the labor market, but says there is still a lot of work ahead in reforming public spending and curbing the budget deficit. According to Susan Schadler, who headed the IMF mission, a significant part of social benefits are misdirected and public debt is reaching dangerously high levels. The IMF also criticized recent political attacks on the National Bank of Poland (NBP) and its Monetary Policy Council (RPP), saying they should stop and the legal position of the NBP and RPP should remain unchanged. The IMF also urged the RPP to refrain from further interest rate cuts, until the effects of those already made can be evaluated. In related news, President Aleksander Kwasniewski has given assurances that he would veto any bill limiting central bank independence. (Rzeczpospolita, p. B1) T.J.