Macroeconomic Policies for EU Accession

Macroeconomic Policies for EU Accession

Edited by Erdem Başçı, Sübidey Togan and Jürgen von Hagen

What macroeconomic requirements must Turkey meet in its quest to accede to the European Union? This book, with its distinguished contributors – well-known economists and policymakers – examines and analyses these macroeconomic challenges confronting Turkey. Although the focus is on the specific situation of Turkey, the lessons are informative for other candidate countries and the findings directly relevant to the process of European integration.

Chapter 6: Monetary and Fiscal Policy in Poland During EU Accession

Lucjan T. Orlowski

Subjects: economics and finance, financial economics and regulation


6. Monetary and fiscal policy in Poland during EU accession Lucjan T. Orlowski* 6.1 INTRODUCTION The main objective of this chapter is to review the fiscal and monetary policies of Poland for EU accession and to extract their guiding precepts. Only the most essential aspects of fiscal and monetary convergence are examined, with some attention to institutional convergence. An in-depth analysis of institutional convergence falls beyond the boundaries of this study, as its main focus is on the systemic foundations of macroeconomic stabilization policies during the economic transition and in the course of preparations for EU accession. The chapter also examines policy options for the post-accession macroeconomic policy strategy which will focus on preparations for adopting the euro. This chapter underlines the importance of imposing and preserving fiscal discipline and political stability on the road to Poland’s accession to the EU which took place on 1 May 2004, and to the future adoption of the euro. Special attention is drawn to fiscal restructuring and bringing about compliance with the European System of National Accounts. In addition, the implications of the expected net transfers from the EU budget are examined. The evolution of Poland’s monetary policy, which is marked by a passage from a simple policy framework based on a hard peg to a modern, complex regime based on direct inflation targeting (DIT) is examined. With respect to the tasks related to monetary convergence to the euro, the main analytical hypothesis is that the current strict DIT regime is not...

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