Polish PiS leader presents alternative euro exchange rate, defends zloty

6 months ago 41

The leader of Poland’s conservative Law and Justice (PiS) party, Jaroslaw Kaczynski, offered an alternative euro-to-zloty exchange rate as proof that Warsaw should not join the eurozone.

According to Kaczyński, the real value of one euro is 2.55 zloty, slightly more than half the official exchange rate, which was 4.31 zloty on Sunday. He provided no evidence or sources for his calculations.

Speaking at a party election rally in Sompolno, a town in the Greater Poland region, he also argued that Poland’s entry into the eurozone would lead to a sharp rise in prices and a fall in the purchasing value of wages.

“The (EU) treaties say we have to do it, but we don’t have a deadline. We can do it in, say, 60 years,” he argued. If Poland joined the eurozone, prices in the country would rise to the level of Germany, “which would be unstoppable”, he added.

Kaczyński also said the euro could be an obstacle to Poland’s development.

“If you have a strong currency, you lose (by joining the eurozone) because exports become too expensive,” he pointed out.

“We have good exports, including agricultural products, but if we had the euro, it would only be profitable if wages in Poland were lower,” he added.

PiS argues that Poland should keep its own currency, which it says is a matter of sovereignty. At a party congress last month, Kaczyński said the eurozone only served Germany and a few other rich Western countries, such as the Netherlands or Austria.

Poles have a rather negative perception of the euro, with 66.8% in favour of the country keeping its own currency, according to a poll published last month. The most sceptical are voters of the right-wing opposition parties, PiS and the Confederation Party.

Still, “as a member of the eurozone, Poland could more effectively participate in shaping the economic system in the EU, taking into account security issues,” according to a report published last year by Agnieszka Smoleńska of the Polish Academy of Sciences and Paweł Tokarski of the Stiftung Wissenschaft und Politik.

But according to the Polish MEP of the governing Poland 2050 (Renew) party, Róża Thun, Kaczyński is merely repeating rhetoric that the PiS has been repeating for a long time.”

She told Euractiv Poland, “Threatening the Polish people with the euro has no point at the moment, as the vast majority of the EU countries have already joined the eurozone.”

Poland trades with members of the eurozone, she added, and when money is exchanged, the banks make money while entrepreneurs and citizens lose. “It’s hard to plan the future of your business if you don’t know what the exchange rate will be,” the EU lawmaker also said.

However, Poland cannot join the eurozone as it does not fulfil the requirements, especially the convergence criteria.

“There is still a long road ahead of us. We will not join the eurozone until we ensure that the zloty’s position is stable enough to prevent major price fluctuations or other major economic problems,” Thun said.

(Aleksandra Krzysztoszek | Euractiv.pl)