Poland wary about adopting euro

Polish Prime Minister Jaroslaw Kaczynski today reiterated his wariness about Poland’s quick adoption of the euro, used by 12 other European Union nations.

“I am sceptical,” Kaczynski told a news conference. “I think haste in this matter could seriously hurt us.”

Kaczynski’s socially conservative Law and Justice party has continuously voiced doubts about fast adoption of the euro, arguing it would not be beneficial for this ex-communist country as it labours to catch up economically with the West.

“We have to join the euro, but there’s no fixed deadline, so we can do it when the levels of economic development in Poland and the euro zone are closer than they are now,” Kaczynski said.

The central bank is pushing for adopting the common currency as soon as possible, claiming that it would eliminate the risk of currency volatility and accelerate economic growth.

President Lech Kaczynski, the prime minister’s twin brother, recently said he favoured 2010 as a date for a referendum on euro adoption.

The prime minister also said his government approved an updated version of its euro convergence strategy, a key document guiding the country’s drive to join the common currency.

The announcement comes a day after European Union finance ministers ordered Poland to do more to rein in a budget deficit that will next year climb above the 3% of gross domestic product limit set by EU rules as it counts the cost of pension reform. The ministers told Warsaw to re-examine its draft budget for 2007, saying current action is “insufficient” to cut public debt by the end of 2007.

The document presented by the prime minister envisions Poland’s budget deficit dropping to 2.9% of gross domestic product again in 2009.
Source: irishexaminer.com