Press Release No. 04/247

Press Release: IMF Managing Director Rodrigo de Rato's Statement at the Conclusion of a Visit to Poland

November 23, 2004

International Monetary Fund (IMF) Managing Director Rodrigo de Rato made the following statement on November 22 in Warsaw:

"I have had the privilege of meeting His Excellency President Aleksander Kwasniewski, Prime Minister Marek Belka, Speaker of the Parliament Jozef Oleksy, Deputy Prime Minister and Minister of Economy and Labor Jerzy Hausner, Central Bank President Leszek Balcerowicz, Finance Minister Miroslaw Gronicki, and several of their colleagues.

"We have had fruitful discussions on Poland's economic prospects and economic policy priorities. Poland's accession to the European Union marks its successful transition to a market economy. The Fund is pleased to have supported this process both through programs in the early days of the transition and ongoing surveillance and technical assistance since then.

"Poland's economy is in a strong position. The prospects for rapid real GDP growth in the near term are good. Inflation, despite its recent spike, should not be a threat to economic stability. And the external position is strong. We welcome the medium-term fiscal stabilization (Hausner) plan, which constitutes a good first step towards tackling fiscal problems. The favorable cyclical position should be used to press ahead with fiscal and structural reforms needed for robust growth in the medium term and to stabilize public debt.

"Euro adoption will generate substantial benefits for trade and growth--promising to accelerate the catch-up to EU income levels. It is in Poland's and the euro area's interest to move ahead as soon a strong structural fiscal position is in place.

"The IMF regional resident representative office in Warsaw, which will be opened in January 2005, will have a broad mandate to support the Fund's surveillance in the eight new Central European members of the European Union. Establishment of the office signals the importance the IMF attaches to these countries in both a regional and global context and to their successful economic integration with the EU.

"A particular focus of the office will be on policies to frame and execute plans for the euro adoption. The office will be in close contacts with the national authorities and the EU institutions to participate in ongoing policy dialogue and to offer assistance on the road to the euro."