Is the current government under siege by economic policy criticism, domestic unrest, or international pressures?
The current government in Poland is not under siege from the international economy. The government is facing criticism over its economic policies. The economy has been advancing if freedom for the fifth consecutive year after being the only European Union country to survive the recession. The economy has very few barriers to free trade making commercial operations very easy. The favorable business climate coupled with political stability has enabled the economy to record the tenth-largest score in growth in the year 2013. In spite of this positive result, some believe the economy would have done better. The Polish senate has been reluctant to reduce interest rates. This has resulted in an increase in the criticism about their economic policies (Gordon, Patryk).
The central bank says that the weak performance of the economy is due to late cuts in the interest rates due to the monetary policy. There is also increasing international pressure for Poland to adopt environmentally friendly ways when growing their economy. Poland is a large consumer of coal and natural gas. This boosts its economy vastly due to the exports they make. It is a huge part of their GDP. The international community pressures them to reduce the use of these products (Gordon, Patryk). The pressure is piling from the international community for Poland to use more energy-saving mechanisms in its manufacturing industries. Poland has tried to improve the manufacturing industry by adopting better technology in the production of products.
Is local currency accepted in the market basket of currencies commonly used in global foreign exchange reserves?
The local currency is accepted in the global foreign exchange reserve. The Foreign exchange reserves are the foreign currency deposits that are held by monetary authorities and the central banks. These reserves are termed as international or official reserves of the various countries. The reserves may be in terms of foreign banknotes, bank deposits, treasury bills, and government securities. The foreign exchange of polish currency reserves increased between March and February as reported by the national bank of Poland (Goettig). In earlier times, the reserves that were held by many central banks were in terms of gold or foreign currencies. The demand for polish currency especially after their economy survived the recession increased. Government bonds and treasury bills are the most common ways of holding reserves. There is also increased use of foreign currencies and corporate bills and equity. The Polish economy is growing at a steady rate so many countries feel secure by reserving the Poland currency in their banks (Encyclopedia of the Nations).
Is a change of government likely in the short run or on the medium-term horizon, scheduled or otherwise?
A change in government will result in a change in the short run or medium-term borazon. The government has been slow in changing the fiscal policies of the country. This has resulted in slow responses to the changing world economy. This has caused a slow increase in the growth of the GDP in Poland. The government wants to maintain the fiscal policies that helped them wade through the economic crisis that affected most economies in Europe. Being the only European Union country to escape unharmed by the global recession, the government is not keen to change the policies. The government is now working on legislation that will improve the economy. This is in spite of the increasing financial trouble of some of the neighbors. The change in policies should be scheduled so as to make the change smooth (Goettig).
Works Cited
Encyclopedia of the Nations. “Poland-Politics, government, and Taxation.” 2008. Web.
Goettig, Marcin. “Poland president says no euro entry decision before 2015 ballots.” Reuters. 2013. Web.
Gordon, Patryk. “Poland Pledges to Improve after Missing Fiscal Target.” The Wall Street Journal. 2013. Web.