Poland: Resignations and Reshuffles
Poland's political scene was rocked by last week's resignation of the country's finance minister and a surprise cabinet reshuffle three days later.
The Polish government was shaken last week by the sudden resignation of Finance Minister Marek Belka and a surprise cabinet reshuffle involving two other ministers. The abrupt departure of Belka, who said he was leaving because he felt "burnt out," sent jitters through the markets, as the zloty slumped against the dollar and the euro, and stock and bond prices dipped.
Three days after Belka's resignation on 2 July, Prime Minister Leszek Miller called a press conference to announce that he was appointing former Finance Minister Grzegorz Kolodko to replace Belka, and added that he was replacing two other ministers in the cabinet.
He said Culture Minister Andrzej Celinski had resigned and would be replaced by Waldemar Dabrowski. The prime minister also said he had asked Justice Minister Barbara Piwnik to resign, and said he would replace her with Grzegorz Kurczuk. Miller gave few details on the reasons behind the changes, but they come at a time when the government is grappling with a slowing economy and sagging popularity. The current governing coalition, led by Miller's Democratic Left Alliance (SLD), came to power after last September's elections.
Asked whether he viewed the changes as a setback for his government, Miller said: "I can only consider this question to be a joke." He declined to say why he had fired Piwnik, saying only that there was a "need" for the change. Piwnik declined to comment until she returned from a holiday on 8 July. Miller added that Celinski had quit because he wanted to "concentrate on other matters."
While Belka, who had also served as deputy prime minister, insisted he was quitting after just eight months in his post due to exhaustion, his resignation came just as the government was about to table the 2003 state budget with a larger deficit than he had recommended. Belka had been pushing for a deficit of no more than 40 billion zlotys ($9.6 billion), or 5.2 percent of GDP, but he had come under pressure from other members of the cabinet who wanted a wider gap. A few days before his resignation, the cabinet had approved a larger budget gap of 43 billion zlotys.
While Belka denied on 2 July that the lost battle over the budget was behind his decision to quit, he had said in an interview with the daily Rzeczpospolita before his resignation that he would leave when he felt he would no longer be able to implement his economic policies.
Speculation also surfaced in the Polish press that Belka's resignation may have been related to an alleged attempt to screen his past to see if he had collaborated with the former communist secret police. Belka's spokesman described those allegations as "absurd."
Analysts cited by the Financial Times said the departure of Belka, who was viewed as the most market-friendly minister in Miller's cabinet, was a blow to the government. While there was no overwhelmingly negative reaction to Kolodko's appointment, observers cited by the paper said the markets would be wary of the new minister. Kolodko, who served as finance minister and deputy prime minister from 1994 to 1997, had advocated greater fiscal spending in his previous term in office.
Kolodko has said in the past that he would recommend a 15 percent devaluation of the zloty and that he would peg the Polish currency to the euro. He has also said that he thinks Poland can achieve 7 percent GDP growth in 2004 and 2005. At the moment the economy is growing at a snail's pace of just 1 percent annually. Belka had set his sights on achieving 5 percent growth by 2004.
Kolodko has also weathered various controversies in the past. He was involved in the so-called Eko-Sekoci n housing estate scandal involving the construction of luxurious houses for various state officials using public funds.
He is also thought to be a fierce opponent of Leszek Balcerowicz, Poland's central bank governor. Miller's government has been feuding with the central bank over economic policies for some time, and some observers expect the conflict to worsen under Kolodko.
Politicians in the governing coalition, which includes the SLD and the Polish Peasant's Party, have been enthusiastic in their support for the appointment of Kolodko. They attribute the spectacular economic growth Poland experienced in the mid-1990s to Koldoko's earlier term in office.
But the opposition was markedly less enthusiastic. "Kolodko is a colorful and controversial figure. We cannot forget Eko-Sekocin, though, because honesty is very important in politics. As for his economic views, he's too social democratic for us--too willing to increase the budget deficit," Maciej Plazynski of the opposition Civic Platform was quoted as saying in Gazeta Wyborcza on 5 July.
The Polish Press Agency (PAP) speculated that the unexpected cabinet reshuffle had resulted from a "deal" between Miller and President Aleksander Kwasniewski. Belka had previously worked as an adviser to Kwasniewski, and the president was reportedly unhappy that he would be replaced with Kolodko and demanded changes in other ministries as well. "It was a compromise. The president wasn't a fan of Kolodko and he indicated ministries that required improvement," an official who refused to give his name was quoted as saying by PAP.
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