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The Warsaw Voice » Business » November 30, 2010
From the Business Editor
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Shortage of Determination
November 30, 2010   
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It has been three years since the formation of the Tusk government. If one looks at popularity ratings, where the list is led by Civic Platform (PO) party, the senior partner in the ruling coalition, it seems that most Poles like this government. But economists and businesspeople are much more critical and complain that the government does not show sufficient determination in pursuing reforms.

Prime Minister Donald Tusk regards protecting Poland against the economic crisis as the greatest success of his government. Indeed, Poland was the only European Union country to have avoided recession last year. But does the Polish economy owe its relatively favorable condition to the government or other factors? Opinions on this matter are divided.

Members of the Lewiatan Polish Confederation of Private Employers believe the biggest achievement of the government was the reform of early retirement regulations, which led to a significant drop in the number of people entitled to early pensions. Among the government’s successes, the entrepreneurs also point to the efficient use of EU funding and the acceleration of privatization processes. They believe, however, that the share of state ownership in the Polish economy is still too high.

Both entrepreneurs and economists criticize the government for failing to present a credible plan to gradually balance public finances. Poland’s public debt is mounting and its service costs are growing and will continue to grow if the government does not tackle the public finance deficit. The government is also losing its battle with bureaucracy; the central and local government administration is constantly expanding. There has been no significant improvement in the law-making system. And the economy has not been deregulated, in spite of earlier promises to do so.

The critical views of Polish entrepreneurs are backed by the World Bank’s Doing Business 2011 report, which ranks Poland in 70th place in terms of ease of business operations. Although Poland moved up three places compared with the previous table, its ranking is totally unsatisfactory, especially when such countries as Namibia, Belarus, Ghana and Montenegro have moved ahead of Poland. The highest-ranking Central and Eastern European countries are Estonia—in 17th place—and Lithuania and Latvia—in 23rd and 24th place, respectively. Poland performed the worst in terms of dealing with construction permits, buried in 164th place on the list of 183 countries.

It is clear that the government still has a lot to do to get entrepreneurs to stop complaining about conditions for doing business in Poland. As it begins its fourth year in power, we hope the government shows more determination in carrying out reforms. This is what Polish businesspeople are waiting for.
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