A rare sign of fiscal responsibility

WBJ:

Poland manages to massively reduce its foreign debt burden to the Paris Club

Poland's debt to the Paris Club has diminished by 42% as compared to the end of 2004, when it amounted to EUR 12.3 billion. The government managed to totally pay off countries such as Germany, UK, USA, Switzerland, Netherlands, and Sweden. Poland still owes the Paris Club EUR 7.1 billion, which constitutes nearly one third of the foreign debt, and liabilities with France, Austria, Canada, Japan, Italy, Belgium and Norway still have to be settled. "We are still in talks with the creditors. There is a chance that the government will manage to negotiate some debt reductions," said Paweł Kowalewski from the Finance Ministry. He did not want to disclose how much the budget saved on paying part of the debt earlier than planned. According to unofficial sources, the savings amount to hundreds of millions of złoty, mainly due to lower debt servicing costs. Kowalewski stated, however, that the financial benefit was not the main reason for the early repayment to the Paris Club. "Rather this has to do with the prestige of our country," he said.