Friday, September 29, 2006

Investors do not panic over the „tapes of truth” scandal

Politicians are more excited about the “tapes of truth” scandal than investors. The reaction of the markets was weak. But politics are not supporting the markets.

A political storm broke out when TVN television broadcasted the conversations of Renata Beger, the MP of Samoobrona populist party with ministers Adam Lipinski and Wojciech Mojzesowicz. The films recorded with a hidden camera show the way the politicians of PiS ruling party were trying to attract Samoobrona MPs to join their party. Opposition parties say this is political corruption.

The financial market reacted with a slight depreciation of the zloty and bonds.

“The zloty opened lower. There is no panic however. Investors refrained from decisions rather. The risk of elections before the expire of the Parliament’s term is growing and we all are getting used to it. However, the moods would be better hadn’t it been for the politics”, Marcin Bilbin, Pekao analyst commented.

Maciej Grabski from the Gdansk Institute for Market Economics believes that investors are waiting for facts like the budget.

Politicians reacted with much more panic. They started reacting late at night and continued all day long with comments, statements and briefings. Marek Kuchcinski, PiS head, said that the whole affair was a “great political provocation” aimed to stop the changes being implemented by the government. Krzysztof Putra, another PiS MP said that calling the affair a political corruption is funny and that journalists are misleading the public opinion.

Meanwhile, the opposition increased the chances to take the power out of PiS party. SLD leftist party submitted a file to dissolve the Parliament before the expiry of its term (PO is said to have submitted such a file before) and wanted Prime Minister Jaroslaw Kaczynski to stand in front of the Tribunal of State. At 8.00 p.m. Prime Minister in his statement said that there was no big problem and suggested that PiS would not give up easily.