13 August 2007

EZA 806 Briefing Note:

Poland
Snap elections – positive for markets, but changes likely to be incremental On 12Aug07 prime minister Jaroslaw Kaczynski threw in the towel announcing snap elections for 21Oct or early Nov. Although snap elections seem likely, a failure of the parliament (Sejm) to dissolve itself – given required support from the new left – might lead to a later date. The election result should be overall market positive, given the current lead of the liberal PO in the opinion polls. But a (market- unfriendly) recovery of the conservative PiS cannot be ruled out, given its strong campaigning capacity. Even if the PO might be able to form a new government this will see constraints from the strong position of president Lech Kaczynski.

Asset conclusions: slightly positive, given the outlook for a more market-friendly policy regarding taxes, pension reform and euro accession.

© Graham Bishop