Poland Economy

Bankers from around the world signed a generous debt-reduction agreement with Poland on Wednesday, cutting by almost half the $14 billion in Communist-era obligations still owed to more than 400 commercial lenders. The long-awaited agreement brings to an end almost 15 years of haggling over Poland's indebtedness and is expected to give an important boost to the country's economy, already one of Europe's fastest-growing.

Appealing to logic and national pride, President Clinton sought Thursday to bolster weary Poles' faith in the free market's "proven path to prosperity," as economics overshadowed security concerns in his second day of meetings with Polish leaders. Clinton, who later flew to Naples, Italy, for a three-day economic summit that begins today, spoke in an appearance before the Sejm, or lower house of Parliament, of Poles' valor in fighting Adolf Hitler and in their long struggles against the Soviets.

There is perhaps no better symbol of Poland's rush to capitalism than the Warsaw Stock Exchange, the top-floor tenant in a downtown financial center that was once home to the Communist Party. Where ruling apparatchiks earlier plotted the course of Poland's centralized command economy, aggressive investors now dream of striking it big in Eastern Europe's fastest-growing and most-talked-about market economy.

Polish voters issued a stunning rebuke to the country's aggressive economic reformers Sunday, giving two parties with Communist-era roots a majority of seats in the lower house of Parliament, according to preliminary projections early today. In just the second free parliamentary election since the collapse of communism in 1989, the biggest winner was the opposition Democratic Left Alliance, the successors to the former Communist Party.

Just four years after the celebrated collapse of communism in Poland, the so-called invisible hand of capitalism is about to get slapped. Fed up with the stresses and strains of building a market economy from the shambles of communism, Poles are poised to do the seemingly unthinkable Sunday: elect a government with roots in the haunted past.

Among former Communist industrial combines struggling to make it in the tough new world of private enterprise, Poland's Mostostal should be a prime candidate for success. Long before the Soviet Bloc's collapse, the Warsaw-based heavy engineering company was operating in the West.

Tadeusz Zielinski is a man of the people--35,236 of them in 1992, to be exact. Zielinski is Poland's government ombudsman, and that's the number of letters the Krakow-born lawyer received last year from those seeking help and direction as the country makes the wrenching transition from communism to free-market democracy. As problems grow and Zielinski's office becomes better known, the mailbag grows. Letters now are arriving at a rate of 300 a day.

Parliament rejected a privatization plan Thursday, dealing the coalition government its worst defeat and leaving Poland without a framework for the mass privatization of large state enterprises. Prime Minister Hanna Suchocka exchanged a shocked look with her Cabinet members when Parliament rejected the measure 203-181, with nine deputies abstaining. Defections and absences by about 25 coalition deputies sank it.

Grzegorz Maleszewski is 22 years old, tall and thin as the rough-sawed pine planks cut from the forests on his land. In his bemired work clothes, mucking out the cowshed or stalking across the barn lot with a load of hay riding high on a pitchfork, he has the appearance of an animated scarecrow but a face to which a wry smile comes readily, and often. Maleszewski is a content young man, and that is not an easy mood to find these days on a Polish farm.

The dairy cases of Poland's grocery stores are stocked high with butter from Germany and the Netherlands--so high that native son Brunon Wardecki, who owns 13 black-and-white cows, cannot profitably sell butter even to his local market. And he doesn't stand a chance of selling it in Western Europe. Dairy farmers there receive huge government handouts, allowing them to undersell their Eastern European competition.