Think-tank predicts budget amendment due to zl.10-12 billion shortfall

Independent economic think-tank Centrum Analiz Spoleczno-Ekonomicznych (CASE) has suggested that Poland's budget will have to be amended, as there is bound to be a shortfall of zl.10 billion to zl.12 billion as a result of lower-than-expected economic growth. CASE revised down its 2001 growth projection to 2.9%, compared to the 4.1% actually achieved in each of the past two years. The slowdown of the domestic economy, the CASE report says, is due mainly to the strength of the zloty and high interest rates. Despite this, the CASE analysts do not expect the Monetary Policy Council (RPP) to reduce interest rates by more than 2% or 3% before the end of the year. CASE is also predicting inflation at 5.6% and the budget deficit at 4.4% of GDP. The rate of unemployment is seen as rising to 16.6% by the end of the year. (Gazeta Wyborcza, p. 21, Prawo i Gospodarka, pp. 1, 2) M.K.