Poland's planning minister, predicting an unprecedented 15 percent drop in national income this year, today warned of economic collapse unless reforms are introduced immediately.
The forecast was made to a specially convened session of the national legislature as prime ministers from all 10 Soviet Bloc countries met in Sofia, the Bulgarian capital, to study the economic impact of the Polish crisis. Poland's economic plight has vastly complicated attempts by the Communist trading organization Comecon to coordinate the five-year plans of its member countries.
The session of heads of government is an annual tradition in Comecon but has assumed extra significance this year in view of developments in Poland. According to officials figures, Poland failed to deliver almost $40 million worth of coal, coke, sulfur and other supplies contracted for by its Comecon partners in 1980. The trend has worsened this year.
[Uncertainty surrounded a planned trip to Poland by Soviet Foreign Minister Andrei Gromyko today when Moscow announced that no date for the visit had been set, Reuter reported. Soviet leaders and former West German chancellor Willy Brandt had announced in Moscow last night that Gromyko would fly to Warsaw today.]
The seriousness of the crisis was underlined in Warsaw by the new Polish planning minister, Zbigniew Madej, in his first address to parliament, which was called to consider government proposals for economic reform. He disclosed that production was 18 percent lower in May than the same month last year, and 10 percent lower in January.
They expected 15 percent drop in national income means that Poland's national income will decline for the third year in succession. It fell by 2.3 percent in 1979 and by 4 percent in 1980.
After enjoying high growth rates in the 1960s and early 1970s, all Comecon countries are now entering a period of lower growth than at any time since World War II.
While no other Communist country is yet in such dire straits as Poland, all suffer from similar economic problems. These include outdated technology, a bias toward unprofitable heavy industries like steel, inefficient agriculture, a high rate of foreign indebtedness, and a clumsy price structure. a
Meanwhile, partly because of what has happened in Poland, it has proved virtually impossible for Comecon countries to coordinate their five-year plans -- the key economic mechanism in Eastern Europe -- with any degree of efficiency. The failure of Polish factories to meet delivery targets has become a recurring complaint throughout the region.
In his address to the legislature, Madej indicated that -- even by the most optimistic estimates -- it will take Poland at least five years to get back to the 1978 level of national income.
He added: "Unless we start on economic reform immediately, from today, nothing can save us from catastrophe, from a total breakdown of our economy."
The presentation of a workable economic reform program has also been set as a prior condition by private Western banks for rescheduling Poland's hard currency debt. Poland owes about $26 billion to Western creditors, of which $3.1 billion is due this year.
The legislature is considering proposals to streamline the top-heavy economic bureaucracy by reducing the number of ministries and giving individual factories greater responsibility.
Meanwhile the length and number of lines in Warsaw and other cities grows constantly.Cigarette and alcohol coupons are being issued in some regions to supplement the existing rations for meat, butter, sugar, rice and grains.
Economists agree that a key element in the economic reform is an overhaul of the chaotic price system -- but this issue is also extremely sensitive politically. An increase in meat prices announced exactly a year ago sparked widespread labor unrest and led to the formation of the independent trade union federation Solidarity.
Made said that this time workers would be consulted in advance about proposed price increases. He supported the idea of large, across-the-board increases later this year rather than a series of smaller increases.