Poland's PM unveils EUR 42bn stimulus plan to boost growth, jobs

(WARSAW) - Poland's centrist Prime Minister Donald Tusk won a confidence vote Friday after unveiling 42 billion euros ($55 billion) in short-term stimulus to sustain growth and jobs.

"Our priority is to sustain growth, even if it is slower, at all costs and to protect jobs," Tusk told parliament as a fresh opinion survey by the TSN Polska pollsters showed his popularity has plummeted to 26 percent, with his negative rating at 44 percent.

While Poland's economy has so far mostly dodged the crisis affecting its eurozone neighbours, growth is set to slow to 2.5 percent this year, down from 4.3 percent in 2011.

The government expects growth to slow further to 2.3 percent next year, and the jobless rate stands at 12.5 percent in the nation of 38.2 million.

Topping the list of Tusk's proposed investments is 60 billion zloty (15 billion euros, $19 billion) by state-owned energy companies into projects including in new coal-fired power plants, a LNG terminal and pipelines.

He also announced the creation of a 40 billion zloty investment fund, to be backed by shares in state-owned companies, that would seek to stimulate job creation through to 2015.

Tusk also pledged 40 billion zlotys over three years to update motorways. Billions will also be poured into railway modernisation though 2015.

With Poland suffering from one of the world's lowest birthrates, Tusk also vowed to boost maternity leave, offering new mothers one year off work at 80 percent of their salary, more public day care centres and preschools.

Tusk's move comes one year into his second consecutive term, as a slowing economy and a series of missteps have seen public support for his centre-right coalition wane to the advantage of the right-wing opposition.

With his centre-right coalition holding a slim majority in the 460-seat parliament, Tusk mustered 233 votes in favour to 219 against with no abstentions Friday evening in the confidence vote he called a day earlier.

"This programme demands a clear parliamentary majority. We want to confirm that our legislative mandate is still strong," he told legislators earlier Friday during his policy address.

But three separate surveys published this week showed his Civic Platform (PO) languishing behind the conservative opposition Law and Justice (PiS) party.

The drop in popularity "is the effect of an accumulation of discontent in different areas of life, be it the state of public infrastructure and administration or health care," Stanislaw Mocek, an analyst with the Polish Academy of Sciences told AFP Friday.

President Bronislaw Komorowski said Tusk's call for a confidence vote was a "courageous" move, noting the proposed stimulus plan was "aimed at preserving growth" rather than "invoking crisis to scare" people, an apparent swipe at the recent rhetoric of the opposition.