Poland says still committed to euro despite Greece

WARSAW/BRUSSELS Tue May 18, 2010 5:26pm BST

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WARSAW/BRUSSELS (Reuters) - Poland remains committed to adopting the euro and could join as early as 2014, two ministers said on Tuesday, despite the debt crisis engulfing Greece and threatening some other EU member states.

Last week, Finance Minister Jacek Rostowski said the euro zone needed time to "refurbish" due to the debt crisis and that Warsaw was in no rush to join, but he signalled on Tuesday that Poland was keeping its options open.

"2014 is possible, 2015 is realistic, but it may also be 2016," Rostowski told reporters in Brussels when asked to clarify the government's position on entering the euro zone.

Speaking earlier in Warsaw, Deputy Finance Minister Dominik Radziwill said: "We still want to join the euro zone as fast as possible. For sure there is a great desire and willingness to carry out reforms and enter the euro zone."

"I believe that (entry) could be 2014-2015," he said.

Economists polled by Reuters say 2015 is the earliest entry date for Poland, the EU's largest ex-communist member state.

Prime Minister Donald Tusk's centrist government insists euro membership remains a strategic objective but has not set an official new target date after the global crisis last year forced it to drop a 2012 goal for swapping zlotys for euros.

Tuesday's comments by Rostowski and Radziwill underscored the continued conviction among Poland's political and business elite that the benefits of euro membership -- including reduced currency risks and greater trade -- outweigh the disadvantages.

Economists also say Poland's much lower debt levels would shield it from the kind of pain now being endured by Greece and say euro membership should entail lower borrowing costs.

GREEK LESSON

Poland is preparing for a presidential election on June 20 and Tusk has said a victory for opposition leader Jaroslaw Kaczynski, a eurosceptic, could imperil economic stability and lead to the kind of turmoil seen recently in Greece.

But Kaczynski, the twin brother of Poland's late president Lech Kaczynski, who was killed in a plane crash last month, said in an interview published on Tuesday the Greek crisis vindicated his party's caution about rushing to join the euro.

"(Greece's) problems are caused by the fact that it adopted the euro without being prepared," Kaczynski told the conservative daily Rzeczpospolita.

"If anybody would bring Poland to the situation in which Greece is now in, it would rather be the party which wanted to take us into the euro in 2011," he said, referring to Tusk's initial plan to adopt the common currency as early as next year.

"I think that Poland should adopt the euro at a time when it is safest and most useful for us to do so."

Unlike Britain, Poland and other ex-communist countries which have joined the European Union since 2004 do not have a legal opt-out from joining the euro, though the timing is left to individual governments. Estonia is now set to join next year.

Kaczynski's right-wing Law and Justice party (PiS) has long argued against rushing into the euro, saying Poland should focus on building up its own economy with the help of a free-floating currency and closing the wealth gap with western Europe.

Economists say the zloty currency's sharp fall against the euro last year helped Poland weather the global financial crisis, becoming the only EU member state to avoid recession.

Opinion polls show Kaczynski trailing Bronislaw Komorowski, the candidate of Tusk's ruling Civic Platform, in the race for the presidency. He may manage to push the election to a second, decisive round on July 4.

Kaczynski is banking on a large sympathy vote following the death of his brother Lech in the April 10 crash in Russia.

(Writing by Gareth Jones; Editing by Charles Dick)

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