Is Poland losing its investment appeal?

News agency Reuters reported, citing UK-based analysts, that investors may turn away from Poland amid concerns about its new right-wing government.  In turn, Hungary may become the favored destination for investors' cash in Central and Eastern Europe this year. "In previous years I would have always bet on Polish (assets) but now this is far from certain as it depends very much on what they will do (politically)," said Viktor Szabo, portfolio manager at Aberdeen Asset Management in London, when asked if Polish or Hungarian assets would fare better in 2016. According to the agency, the election of the conservative Law and Justice last fall caused unease among investors "that helped drive Warsaw's blue-chip index to its lowest level in almost seven years this month". By contrast, Hungary, who had often unnerved investors since 2010, has proposed "capping its banking tax at less than half the current level next year and setting incentives for banks to lend more." In addition, "analysts expect an upgrade this year to its sovereign debt rating, which has been 'junk' since 2011." Reuters also said that "Hungary's main index has risen to near a five-year high" and "the Hungarian forint outperformed the Polish złoty in the second half of 2015." On Wednesday, the European Commission launched a procedure to examine whether Poland has breached law over the constitutional court and public media. Consequently, "Poland could be losing some of its lustre," the agency said.