Poland names bank economist as new finance minister

Reuters News
Posted: Nov 20, 2013 6:41 AM
Poland names bank economist as new finance minister

By Christian Lowe and Karolina Slowikowska

WARSAW (Reuters) - Polish Prime Minister Donald Tusk named a political novice as his new finance minister on Wednesday in a reshuffle designed to re-invigorate a government that many voters feel has lost its way after six years in power.

Mateusz Szczurek, the 38-year-old chief economist for central Europe with Dutch bank ING in Warsaw, replaces Jacek Rostowski, who was finance minister for six years but had quarreled with Tusk in the past few months.

Szczurek, part of a generation of Poles who came of age after the fall of Communism, has no background in domestic politics and his appointment may shift the centre of gravity for financial policy-making in eastern Europe's biggest economy towards the prime minister's office.

"The finance ministry will be weak and just carry out policy measures dictated by the prime minister's office, and more specifically, the prime minister's chief adviser Jan Krzysztof Bielecki," said one leading Polish economist, who spoke on condition of anonymity.

Poland's economy is growing faster than its neighbors in the euro zone but is still close to its weakest in more than a decade. With the government's popularity sliding, Tusk is under political pressure to boost growth before a 2015 parliamentary election.

Former colleagues of the new minister told Reuters he is a talented economist whose commercial background will help reassure markets. The zloty currency weakened slightly on news of the appointment, then recouped its losses.

People who know him say that, like his predecessor, he is cautious on the speed of Poland's accession to the euro, and will not try to unravel Rostowski's main policies.

His style, however, will be very different to Rostowski. A dominant figure in Polish public life, the last minister was fond of haranguing ministers from other European states, and of handing withering put-downs to members of parliament who challenged him.

Reuters had reported exclusively in August that Tusk was preparing to replace Rostowski within months.


Tusk also named new ministers for the environment, sports, science and higher education and administration. Regional development minister Elzbieta Bienkowska was made deputy prime minister.

"For the next leap in our development, we need new energy," Tusk told a news conference at which he announced the changes.

Rostowski, a former academic who was born in London to a family of Polish émigrés, was the public face of Poland's "economic miracle" - it was the only European Union state not to go into recession after the 2008 global financial crisis.

But his days looked numbered after he failed to predict a sharp economic slowdown at the end of last year. The economy has revived somewhat, but the 2013 budget he drafted assumed tax revenues that turned out to be wildly optimistic. That had to be revised, shaking Tusk's confidence in his minister.

Economists close to the government say there is now a pressing need for structural changes.

Poland's government still spends more than it earns in revenue. Rostowski masked that by changing the way public debt is calculated, and by finding short-term fixes, including a plan to transfer assets from private pension funds onto the state's balance sheet.

"Rostowski is an excellent tactician," said Dariusz Filar, a member of Tusk's Economic Council, an advisory body. "At the same time he ... fails to think strategically."

Economists say stop-gap solutions such as the pension transfer will buy Poland breathing space of two to three years, but after that the government will have to reform spending, including over-generous welfare for some sections of society.

However, it was not clear if the new minister would have the political heft to push through those changes, especially if they risk angering voters and weakening Tusk's authority over his increasingly fractious party.

(Additional reporting by Pawel Sobczak and Marcin Goettig; Writing by Christian Lowe)