Poland set to reduce deficit in faster pace.

By bne IntelliNews April 26, 2011
Poland will inform European Comission that in 2012 will reduce its budget deficit from 7.9% of the GDP to 2.9%, not as earlier discussed to 3%, according to the publication of daily Dziennik Gazeta Prawna. According to this report, this declaration has been made in the update of the Convergence Program, a document which will be discussed by the Government. Im March finance minister Jacek Rostowski has announced that Poland will wind up its excessive deficit procedure in 2012, as required by the European Commission. Poland has been the subject of excessive deficit procedure since July 2009, when the European Council also issued recommendations on corrective action to be taken, setting 2012 as the target year for bringing their deficits back below 3% of GDP.Rostowski noted that the recent publication of Q4/2010 GDP data (up by 4.4% y/y in seasonally unadjusted terms and up by 3.9% y/y in seasonally adjusted EU terminology) allowed the ministry to estimate that the 2010 public debt-to-GDP ratio would be lower than the previously-estimated 53.3%. Rostowski also said that he sent a letter to European economic and monetary affairs commissioner Olli Rehn with a table of actions agreed upon with the EC that were designed to bring the general government deficit down in 2011-2012. These would include the pension funds' reform or the budget spending cap. Another factor making it easier to cut the figure to below 3.0% of GDP in 2012 from 7.9% estimated for 2010 would be accelerating economic growth, the minister concluded.

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