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EU warns Poland to get its finances back on target

(BRUSSELS) - The European Commission has asked Poland, one of the EU's star economic performers, to inform it of additional steps it plans to contain its public deficit, an official said Thursday.

Amadeu Altafaj, spokesman for the European Union's Economic Affairs Commissioner Olli Rehn, said Rehn wrote to Polish Finance Minister Jacek Rostovski seeking concrete details on changes to its budget to ensure the public deficit does not increase beyond target.

"The commission indeed has observed budgetary developments which may be not consistent with the (EU's) recommendation," Altafaj said.

In December, Poland passed a 2011 budget which aims to pull the country's public deficit down to 6.5 percent of gross domestic product, more than twice above the EU limit of 3.0 percent.

"We are aware of the intention by Polish authorities to introduce new measures in very near future, to address this matter, this shortcoming."

Rehn wants Rostovski "to specify, to share with us, these foreseen measures as soon as possible."

Altafaj noted that proposals for reforming Poland's pension system "could bring the deficit for 2012 closer to that reference value," but still above the threshold.

Rostovski told Poland's PAP news agency that "we are going to reply to this letter before the end of the month. I expect many EU countries receive similar letters."

Twenty-four of the 27 EU states are currently facing action under a so-called excessive deficit procedure.

Poland's deficit is forecast by national authorities to have hit 7.9 percent in 2010.

Poland's liberal-led government aims to reduce it to 4.5 percent in 2012 and 2.9 percent in 2013 -- below the EU limit of three percent.


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