Tag Archives: Polish

Polish management reshuffles heighten policy uncertainty

* Bourse down 24 pct this year, hit lowest considering that mid-2009

* New govt reshuffles state-run companies’ management

* Future of Polish economy uncertain, fund managers say

By Adrian Krajewski and Marcin Goclowski

WARSAW, Dec 14 Poland’s ruling conservatives have ousted a number of leading executives of state-owned businesses since taking energy right after an October election, in what investors be concerned marks the start off of a campaign to seize a lot more manage over the economy.

In a sign of mounting concern amongst fund managers, Warsaw’s blue-chip WIG20 share index hit its lowest level in six years final week, extending losses that followed the shock election of President Andrzej Duda in Might.

That paved the way for his economically left-leaning but nationalist-minded Law and Justice celebration (PiS) to score a landmark election win in October.

Investors are concerned mainly about PiS plans to tax banks and massive retailers to fund social spending, and about signals that PiS wants to rearrange the energy sector to have profitable firms assume the monetary issues of loss-generating coal miners.

PiS has constructed its popularity on a promise of much more economic equality and has stated it wants Polish, not foreign, money to have more control over company.

“When I hear how very good (PiS tells us) Poland is going to be and at the very same time I witness how the economy is obtaining battered, I truly give up. It may be high time to flee the country,” mentioned a Warsaw-based economist at a foreign-owned bank, declining to be quoted by name.

Reuters spoke with ten fund managers, economists and bankers, who have expressed related concerns.

Polish banks, the most most likely targets of PiS policy plans, have shed 28 % of their worth this year, even though power businesses, which with each other with banks make up about half of the WIG20, have lost 35 percent.

In the latest sacking, the supervisory board of Poland’s dominant gas firm PGNiG dismissed the state-run company’s head Mariusz Zawisza on Friday, replacing him with former PiS economy minister Piotr Wozniak as acting CEO.

State-run utilities Enea and Energa also sacked executives final week.

The head of the state-controlled Warsaw bourse has also resigned, as have the head of cargo carrier PKP Cargo and the chief executive of insurer PZU, raising doubts about PZU’s ambitions to build a best five Polish bank.

Polish governments have a tendency to reshuffle top management at state-owned organizations, but PiS has acted much less than a month after taking office.

The country’s biggest lender PKO, Europe’s No.two copper producer KGHM and best refiner PKN are seen subsequent in line for management reshuffles.

“Alterations are some thing that is expected and organic (when government modifications). This industry anxiousness is unfounded,” Poland’s deputy treasury minister Marek Zagorski told Reuters. “The treasury ministry’s function is to calm the scenario and allow the Warsaw bourse’s development.”

ROCKING THE BOAT

There have been few concrete signs the dismissals have affected firm policies, but investors are concerned the new bosses will push the government’s agenda.

“I am afraid they will rock the boat, which will lead to decrease foreign and domestic investments, even though banks will curb lending since of the new tax. In 1 year’s time we will see an financial slowdown,” a bank source stated.

Bankers, fund managers and economists fret about a repeat of Hungary’s scenario, where unpredictable economic policies by Prime Minister Victor Orban’s government, a function model for PiS leaders, are blamed for scaring off investors.

Hungary’s central bank bought a majority stake in the country’s sluggish stock exchange last month, following Europe’s highest bank levies reduce the Budapest bourse’s turnover by 70 % between 2010 and 2014.

“Numerous aspects have appeared simultaneously (in Poland),” a Warsaw-based fund manager mentioned. “Some face management alterations, others element in tax hikes.”

“Positives are difficult to uncover,” the fund manager said. “We can evaluate the effect of the bank asset levy on the lenders’ balance sheets, but the wider influence on the future of Poland’s economy is unpredictable.”

Investors be concerned the government could try to take over some assets of Polish pension funds if it struggles to finance budget spending, successfully eliminating them as relevant market place players.

Poland, Eastern Europe’s greatest economy, has not suffered a recession in 20 years. This and around $ 11-billion worth of privatisations implemented since the 1989 fall of communism have made its bourse central Europe’s biggest.

Nonetheless, the valuation of recently privatised firms are likely to come under scrutiny soon after the Supreme Audit Workplace stated final week that the state treasury had sold several companies also cheap, which includes chemical group Ciech.

Retailers also face a new levy next year although the new bank tax bill, currently in parliament, could cost the financial sector up to 7 billion zlotys ($ 1.8 bln) next year.

The strategy mirrors taxes imposed on Hungarian banks in 2010 by Prime Minister Orban. Last month, Hungary proposed capping the tax by far more than half the present level, fearing that weak corporate lending may possibly jeopardise economic recovery.

Poland’s central bank governor Marek Belka warned on Friday that the simultaneous introduction of the bank tax and the government’s plan to force banks to shoulder significantly of the burden of converting Swiss franc-denominated mortgages would result in a “serious crisis” for some banks.

Industry sources said uncertainty relating to the banking sector has delayed ongoing sales of nearby units by Raiffeisen and Basic Electric .

Foreign banks have been retreating from Poland in the past few years due to falling margins, a trend highlighted by Deutsche Bank’s Polish arm last week when it raised mortgage loan prices.

“The decision … was caused by the bank’s approach … as effectively as the necessity to adjust to the challenges facing Deutsche Bank and the entire sector,” Leszek Niemycki, Deutsche Bank Polska’s deputy chief, said. ($ 1 = three.9693 zlotys)

(Editing by Susan Fenton)

Thousands rally to support Polish government right after opposition protest

WARSAW Tens of thousands of folks marched through Warsaw on Sunday to express assistance for the ruling conservatives, as Poland remained locked in a constitutional crisis over the appointment of judges who could assist the government pass its legislative plan.

The march took location a day right after a massive anti-government protest, highlighting the depth of divisions, which have become a lot more prominent given that the eurosceptic Law and Justice (PiS) won an outright majority in October’s election.

PiS say the center-correct Civic Platform (PO) party, which ruled Poland in between 2007 and 2015, are refusing the accept the result and attempting to stop it from executing its mandate.

The conflict among the two parties has defined Poland’s political stage for nearly a decade, but the temperature rose soon after the new government appointed 5 out of 15 judges to the constitutional court, a move the opposition says was illegal.

PiS says the judges necessary to be replaced to make sure the balance of power, and that it was the previous government that broke the law when they created the original appointments.

Gaining handle of the court is vital for the celebration. It could establish whether or not PiS is in a position to implement its flagship policy plans, such as overhauling the retirement program.

Waving Polish flags and PiS celebration banners, the demonstrators chanted the names of PiS leader Jaroslaw Kaczynski and PiS-backed President Andrzej Duda, who also took office this year.

“We won the election, but we have no proper to set laws and remodel Poland,” Kaczynski told the crowds ahead of they marched towards the constitutional court constructing.

“This court is supposed to be the stronghold … defending the system, defending all that has been undesirable and disgraceful in the last 26 years,” Kaczynski then mentioned outdoors the court, referring to the time since Poland’s transition from communism.

The lengthy-planned rally took location on the anniversary of the imposition of the 1981 martial law, the communist crackdown on the pro-democracy Solidarity trade union.

(Writing by Wiktor Szary Editing by Alison Williams)

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Thousands march against Polish government as constitutional spat drags on

WARSAW Tens of thousands marched via Warsaw on Saturday to protest against what they named the “democratorship” of the month-old conservative government, as Poland remained locked in a constitutional crisis.

Waving Polish and European Union flags, the protesters chanted: “We want the constitution, not a revolution,” demanding that the government respect the rule of law.

The constitutional clash began when the eurosceptic Law and Justice (PiS) party, which scored a landmark election win in October, appointed 5 out of 15 judges to the highest judicial physique, in a move the opposition described as illegal.

PiS denies the charge. It mentioned judges in the constitutional court want to be replaced to make sure the balance of power in the body, and that it was the previous government that broke the law when they made the original appointments.

“These appointments were made based on a faulty law,” Prime Minister Beata Szydlo said. “We are only fixing the law.”

Gaining control of the court is essential for the party. It could decide regardless of whether PiS is in a position to implement its flagship policy plans, such as overhauling the retirement program and curbing foreign ownership of banks, moves the court could block.

“The current constitutional court is a stronghold of everything that’s incorrect with Poland,” PiS leader Jaroslaw Kaczynski told private broadcaster Republika. “All of our moves can be undermined (by it) in an arbitrary way.”

Critics say the government is emulating Hungary’s Prime Minister Viktor Orban in trying to impose its political agenda by pushing the boundaries of democracy.

“DEMOCRACY IN DANGER”

An opinion poll conducted for public tv has showed that just more than half of Poles think democracy is under threat. The Saturday march was attended by non-partisan organizations and opposition parties.

“Nowadays, it is an assault on the constitutional court, tomorrow, it could be an assault on our freedom,” stated Ryszard Petru, a former Planet Bank economist who now leads the pro-marketplace Contemporary party, Poland’s fourth parliamentary force.

A Warsaw city official stated up to 50,000 folks took element. The protesters included economist Leszek Balcerowicz, who created Poland’s shock therapy transition from communism.

“This is Warsaw, not Budapest!,” chanted the protesters. Smaller sized demonstrations took spot in other cities.

Addressing criticism over its constitutional court agenda, PiS says it was the former government of the center-appropriate Civic Platform (PO) that broke the law.

PO passed a bill this year allowing the previous parliament to appoint five judges alternatively of the three it had been scheduled to elect in the 15-seat tribunal. But President Andrzej Duda, a close ally of PiS, failed to swear them in, opening the way for PiS to challenge their candidacies.

PiS scrapped the nominations, and its parliamentary majority elected 5 new judges, who had been sworn in by Duda.

A lengthy fight could hurt Poland’s image as a model of post-communist transition.

Asked why she traveled more than 100 km (60 miles) to join the protest, retiree Grazyna Huzerowska mentioned: “Simply because I keep in mind the old instances.”

“In my household there were individuals, like my husband, who had been in prison for fighting against communism. I see it’s beginning all over … I think the Polish democracy is genuinely in danger.”

(Additional reporting by Kacper Pempel and Jan Pytalski editing by Andrew Roche)

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Poland says pirates attacked Polish ship off Nigeria coast

WARSAW Poland’s Foreign Minister Witold Waszczykowski stated on Friday that a Polish cargo ship under the Cyprus flag was attacked off the coast of Nigeria by pirates, who kidnapped five members of the crew, such as the captain and officers.

“The rest of the crew, 11 people, are nevertheless on the ship and they are safe… The ship suffered some damages,” Waszczykowski told a news conference.

The ship is presently anchored around 30 sea miles off the Nigerian coast. Kidnappers have not created any demands yet.

(Reporting by Wiktor Szary Writing by Marcin Goclowski Editing by Adrian Krajewski)

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Polish refocus on Smolensk crash could hurt relations with Russia

WARSAW The West may be contemplating a thaw with Moscow, but Poland’s new conservative government could additional strain relations with the country’s former Soviet overlord by reopening an investigation into the death of President Lech Kaczynski in a plane crash in Russia in 2010.

An inquiry by the earlier government returned a verdict of pilot error, but the winner of Poland’s October election, the Law and Justice (PiS) party led by Kaczynski’s twin brother Jaroslaw, says an onboard explosion could have brought on the crash.

Now in energy for the very first time given that the tragedy, the celebration wants a new inquiry and, possibly, aid from international courts and foreign secret services, in examining its theory.

Although PiS never definitively accused Russia of orchestrating the president’s death, it has said the Kremlin benefited from the crash, which also killed the central bank chief, best army brass and many lawmakers, triggering a period of political turmoil.

PiS officials have also accused Moscow of prolonging its investigation, and withholding proof, such as the black boxes and the plane’s wreckage. Russia says these can not be returned until its criminal probe is concluded.

“One could almost feel that the Russians have anything on their conscience, following all,” Poland’s new Foreign Minister Witold Waszczykowski told the Nasz Dziennik daily.

He has also mentioned he cannot rule out the possibility that the president was assassinated.

“Either they resolve this case amicably, or it will be necessary to hand it over to international tribunals, and challenge the investigation in the European Court of Human Rights,” Waszczykowski stated, adding Poland would also ask its NATO allies for support.

Difficult Moscow in international courts, as effectively as relaunching the inquiry, with Russia as the prime – if not openly named – suspect, is probably to damage relations among Poland and its old foe, already fragile over the Ukraine crisis.

The Russian Foreign Ministry did not right away respond to a request for comment.

Reopening the case could also test Poland’s ties with its NATO allies, who may shy away from controversy as some attempt to re-engage with Moscow to fight Islamic State and forge a peace deal in Syria.

Domestically, the move may be popular amongst Poland’s conservative electorate, deeply distrustful of Russia, but it will also reopen memories of a case whose handling by the government aroused wide disagreements amongst Poles.

Individual TRAGEDY

The country’s worst such disaster since Planet War Two, the crash took place near Smolensk, western Russia, close to the spot exactly where Stalin’s secret police shot some of the 22,000 Polish officers and intellectuals it executed in 1940. For decades, Moscow blamed Nazi Germany for the mass executions.

The massacre is an enduring symbol for Poland of its suffering at Soviet hands, and president Lech Kaczynski had been flying in to commemorate it.

For Jaroslaw, whose robust partnership with his twin brother was a defining aspect of their political ascent collectively, winning energy might be an chance to settle a private score, critics say.

He has long accused then prime minister Donald Tusk, who is now head of the European Council of heads of EU states, of being indirectly accountable for the crash, triggered, in his view, at least partially by the government’s negligence.

An investigation by Tusk’s government developed no evidence of that.

Already, the PiS selection for defense minister – Antoni Macierewicz – suggests that Smolensk will be higher on the agenda.

Macierewicz, who in opposition opened his personal unofficial investigation into the crash, has been the leading proponent of theories that one thing much more sinister than pilot error was behind the crash.

“The government headed by (Russia’s then prime minister Vladimir) Putin is fully responsible for this tragedy,” he told the European Parliament in March.

He has told army cadets that discovering the truth about the crash is the greatest challenge facing the Polish army.

For the duration of his investigation, Macierewicz relied on proof offered by authorities who employed props such as crushed drinks cans and burst sausages to clarify that the Russian-made aircraft had exploded in mid-air just before crashing.

The experts had not visited the crash site, and utilised photographs from the net. Their meetings sometimes verged on the farcical, with proceedings at one particular point interrupted by a hoax Skype get in touch with claiming to be from Russian President Vladimir Putin.

Earlier this month, Polish President Andrzej Duda expressed support for Macierewicz’s professionals, saying the official conclusions of Polish and Russian inquiries did not “hold up” when confronted with evidence.

The new government has now shut down the official site devoted to the state investigation, which refuted claims that the plane was brought down by an explosion. 

THE TRUTH

Political analysts say reopening the investigation, and Macierewicz’s anti-Russian rhetoric, largely serve domestic political goals, as they are most likely to appeal to core voters.

Opinion polls show only a single in five Poles believes the lead to of the crash has been properly explained. Nearly a third accept to some degree the suggestion that the president may possibly have been assassinated.

Speaking shortly right after the October election, Kaczynski told supporters gathered to commemorate his brother’s death that more would be carried out.

“I’m convinced that the circumstances for reaching the truth have now been established.”

In spite of the foreign minister’s announcements, it was not immediately clear whether or not the government would really ask Poland’s allies for assist in investigating the crash. Shortly right after the election, PiS leader Kaczynski mentioned a proper Polish inquiry would suffice.

A senior source close to the party leadership stated the new government realized that, at a time when some Western countries want to rebuild ties with Moscow, prioritizing the case could complicate Poland’s relations with its allies.

Poland was for that reason likely to stick to well-established techniques of difficult Moscow, such as international tribunal lawsuits over the withholding of proof, technically Polish property, the supply said, speaking on condition of anonymity.

But Poland was most likely to insist that its Western intelligence partners, who want Warsaw to join the fight against Islamic extremists, reciprocate by handing over any intelligence that may be relevant to the crash, he added.

(Additional reporting by Pawel Sobczak editing by Justyna Pawlak and Giles Elgood)

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