Magazine

Leszek Balcerowicz


Leszek Balcerowicz has been at the center of Poland's economic and political life since the fall of communism in 1989. He served as Finance Minister in the first post-Communist government from September of that year until December, 1991, and was Finance Minister again between November, 1997, and June, 2000. His "shock therapy" reform program, launched in 1990, set Poland on the road to a market economy and European Union membership. "He has been the dominant economic strategist for more than a decade," says Economics Minister Jerzy Hausner.

Now, Balcerowicz wants to lead Poland in the next phase of its economic development -- admission to the euro zone. He aims to do that in his job as President of the National Bank of Poland, the country's central bank. Balcerowicz, 57, has deftly handled monetary policy at the bank since January, 2001, creating a happy mix of high growth and low inflation -- even though the government budget deficit has been rising steadily. This year, Poland's deficit will soar to 7.5% of gross domestic product. Even so, the $230 billion economy should grow by around 6%. The annual inflation rate -- 2.5% in April -- is well within the National Bank of Poland's target zone.

Balcerowicz's free-market policies have always been as painful as they've been controversial. "There can be no radical reform without hardship," he says. "As they say, firefighters should not be surprised by heat." A prolific writer who has penned more than 100 articles and books, Balcerowicz received his doctorate from the Warsaw School of Economics and an MBA from St. John's University in New York.

To prepare Poland for entering the euro zone, Balcerowicz must persuade the government to slash the budget deficit to less than 3% of GDP. That won't be easy. He originally hoped that Poland would be ready to trade its zlotys for euros by 2007. Now, he thinks the job could take two or three years longer. His term ends in 2007, but admirers say he will almost certainly be reappointed. "Complications do not mean that the best strategy is no longer the best strategy," he says. This economic thinker has plenty more to do.


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