Share this story
Close X
Switch to Desktop Site

Back on the farms, Poles turn to new market incentives to aid economy

As the ripples smooth out from the Pope's visit, Poland's officials are turning once again to the economy, hoping that good weather and higher prices for private farmers will brighten the nation's picture.

But it remains doubtful whether even a moderately better-than-average harvest can offset years of misguided government agricultural policy. The situation has been further aggravated by Western anti-martial law economic sanctions.

About these ads

The higher farm prices, which take effect July 1, are part of government reforms now into their second year. Persistent state control over production and development decisions in the private sector still discourages farmers, even though private farms still produce 80 percent of the nation's food.

Reports this week told of delays in the preparation of harvest machinery, with a threat of serious fuel shortages. More tools and machines are slowly becoming available - as is fertilizer - but quantities are still inadequate.

It is claimed that self-management and self-financing responsibility have begun to bring order to the big state farms and cooperatives. Similar proposals are afoot for private farming.

The idea is to create autonomous regional chambers of agriculture run by the farmers themselves and subject only to guidelines jointly worked out with Polish authorities. Also in the works is the long discussed but still unfulfilled constitutional safeguard for private land ownership and inheritance.

Until that is done, more tools and tractors alone will not encourage peasants with their stubborn, traditionally ingrained pride in ownership to cooperate more whole-heartedly with the authorities.

This is where the Polish church seems about to apply its own spur, with an imaginative plan for a farm development plan founded on funds raised by the church through Roman Catholic institutions in the West for the purpose of channeling resources - through the church - to the private sector.

It has been under discussion for some time, but now apparently has been given a strong fillip forward with a go-ahead signal in principle from Gen. Wojciech Jaruzelski to the primate, Cardinal Jozef Glemp, just before the Pope arrived for his visit.

About these ads

Officials hope that extra acreage put under seed this year will increase grain yields by a million tons over last year, although this will be modest compensation for the 5 million-ton shortfall since imports were reduced by Western sanctions.

There are, nonetheless, some brighter trends in the economy overall. Notable is the steady progress in coal and other fuels, which has stabilized the power situation. And, like last year, Poland can again anticipate a favorable trade surplus with the capitalist world.

It is, of course, a mixed blessing against the background of general collapse in economic links with the West and the inevitable consequence of increased trade with communist and third-world markets.

Added to the problems is Poland's own version of inflation. Government reforms are being handicapped by the fact that - as the government newspaper Rzeczpospolita commented - ''Zlotys are still easier to come by than goods.''

An excess of Polish currency was touched off by quite unrealistic (as everyone already knew) across-the-board fringe benefit hikes under the political pressures of August 1980. The process has gone on unchecked, despite drastic price increases intended to stabilize the market.

As late as April, wages were more than 34 percent higher than 12 months previously, while output and productivity grew only 5 and 6.3 percent, respectively. Moreover, in real terms, the latter over recent months has shown a decline.

Reforms have been beset by officials in various ministries resisting the government's three principal recipes: increased output, cost effectiveness, and true market prices and profitability.

But - said Rzeczpospolita - official statistics, bank reports, and the goods in the stores all showed that producers are interested only in that final point.

Enterprise managers were quick to spot that a call for market-prices profitability offered the best chances for increased revenue without responsibility on themselves to improve performance.

Newspapers have spotlighted numerous examples of enterprises which, without any extra effort, are reaping bigger profits on less and even qualitatively inferior goods simply by putting up prices.

''This is against the reform's intentions, its spirit and the letter of the law,'' commented Rzeczpospolita. ''Above all, it goes against the public interest, because manipulating prices drives up inflation.''

Largely to blame is the lack of teeth in the reform itself and the looseness of its finance and credit guidelines, making ''easy money'' available to managers.

Seventy percent of the operating costs of public enterprises, it was recently reported, was being financed by bank credits. No fewer than 183 enterprises were operating on phoney credit claims and well over 500 others were deemed by bankers to have no potential of long-term credit.

New disciplines are being introduced to force managements to prove demand either at home or abroad, to prove also an appropriate return on money lent, and to measure up to strict quality standards.

Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.