21st Sep 2021

Polish leaders side with hardline eurosceptics

Events in Poland have taken a dramatic turn, with the Law and Justice party voting together with hard-line eurosceptics in parliament, endangering the chances of a coalition government and provoking a sharp fall in the zloty.

"A populist-nationalist coalition is forming, the goal of which is to change the treaties agreed with the European Union", Civic Platform leader Donald Tusk told Gazeta Wyborcza in the heat of Thursday (26 October) night.

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  • Warsaw: where is it going? (Photo: Polish government)

His words came after Law and Justice voted together with Self-Defence, the League of Polish Families and the Polish Peasants Party in order to install Marek Jurek as speaker in the lower house.

The Civic Platform broke off coalition talks with Law and Justice after the move.

Law and Justice party chief Jaroslaw Kaczynski ruled out the possibility of a coalition with Self-Defence and the League of Polish Families however, saying "In this parliament the only possibilities are a coalition with Civic Platform or a minority government".

Self-Defence and the League of Polish Families represent a mix of Roman Catholic values and left-wing economic policies, but are united in seeking to renegotiate Poland's accession treaty with the EU.

Law and Justice's new speaker, Marek Jurek, is also a staunch catholic who was among the few party members who opposed Poland's entry into the union in 2004.

Minority government less market friendly

European Commission officials were largely preoccupied with an EU summit in Hampton Court on Thursday, but Brussels' optimism is waning that the more liberal Civic Platform will be able to balance the more aggressive political style of Law and Justice.

Meanwhile, the markets gave their own commentary, with the zloty falling steeply against the euro and investors selling Polish shares on the Warsaw stock exchange.

"The market reaction is due to the uncertain political direction of the new government and how relations will develop with the EU and Russia", Credit Suisse analyst Sven Schubert told EUobserver.

Law and Justice is "less market friendly" he added, pushing to delay euro entry and boost welfare spending, while slowing privatisation.

Extreme scenarios unlikely

But Mr Schubert cautioned that it is too early to speculate on a major EU rift and that investors remain confident about Poland's long-term economic and political stability.

"If a weaker zloty emerges, then we would recommend people to buy", he said.

HSBC analysts believe that Law and Justice is unlikely to ally with Self-Defence or the League of Polish families for fear of alienating its mainstream supporters and weakening its chances in the next elections.

EU diplomats have also expressed confidence that Poland will broadly continue on the same path of improving bilateral and EU relations as for the past 15 years.

Analysts added that anything that might put Poland's EU future in jeopardy would be unlikely to find public backing, with 2005 opinion surveys showing that 63-77 percent of Poles support membership.

Meanwhile, Law and Justice politicians have tried to soothe fears of a Polish radicalisation in recent days.

Party member and MEP Wojciech Roszkowski told Polish news agency PAP "We are advocates of the EU, but we criticise it due to a deficit of solidarity and unity".

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