PM Donald Tusk has said that the aim of his government is to lead Poland into the eurozone and has set 2011 as a target entry date.

Agnieszka Bielawska reports

The Prime Minister spoke about the plans during the opening of the 18 Economic Forum now on in the Polish southern town of Krynica. Donald Tusk stressed that it is an ambitious and difficult plan: ‘I hope that the EU procedures that are required for euro zone entry, notably a two-year period of economic stability, will be fulfilled. Meeting the 2011 target will be a difficult task but possible to realize,’

Upon entering the EU in 2004 this country agreed to meet macroeconomic criteria for euro adoption, for the time being only some of the conditions had been fulfilled. Curbing inflation is a key requirement for countries, which want to join the eurozone. Jacek Wisniewski, analyst of the Pekao BP says Poland is still on the verge of the inflation criteria: 'We have to lower inflation if we want to fulfill long term inflation criteria. Budget criteria are fulfilled but the problem is that we have a high GDP growth; if it will be lower; the budget deficit will grow and will grow above 3%. From long term or even mid term point of view, we are unable to keep budget deficit below 3% if GDP growth will be lower. The two criteria are the most important, one is fulfilled the second is not, but if there will be an economic slowdown then most probably neither criteria will be met.'

Without fulfilling the criteria there is no question of Poland adopting the single currency. The declaration of the Prime Minister makes it clear that this country will make every effort to comply with the demands. Jacek Wisniewski underlines that complying with the demands would not be difficult if the finance ministry conducted certain reforms. He adds however that there has to be a united political will for the reforms: 'Unfortunately in the current situation in the Lower House the probability that the reform will be conducted and signed by the President is low. I think that if the Prime Minister wants enter the eurozone at the moment it is not so easy because of the political situation. Unfortunately the political support is the most important thing , not that much the fulfilling of macroeconomic conditions but political support is the most important for entering the eurozone.'

Analysts point that the Prime Minister's announcement will lure businesses in Poland which could prepare long term investment plans and strategies considering Poland's adopting the euro in 2011. Already the law in line with which entrepreneurs conduct their operations in euro is in force in Poland. However the average household in Poland looks upon the possible switch to the single currency with some apprehension, aware that adopting the euro entailed price hikes for citizens of other EU states already members of the eurozone. Jacek Wisniewski tends to think otherwise: 'I do not believe that there'll be inflation or price hikes during the year when we will be adopting the euro. The problem is that if we have higher wages growth and lower productivity growth we will have inflationary pressure. Let us assume that five years after the eurozone entry we will have such situation, it means that without higher interest rates we will have higher inflation. I do not believe that the European Central Bank will hike interest rates because Poland will be having problems. For the Central European bank always Germany, France and all the bigger EU members will be a top priority.'

In December Poland's national bank plans to release a study on the costs and benefits Poles can expect to come with the euro. Meanwhile the Rzeczpospolita daily has already launched a competition on what Polish symbols should be on the reverse side of the Polish euro.