Poland To Detail 17 Bln Zlotys Budget Cuts On Tues

Tusk said was optimistic the government would not have to seek out even more cuts beyond the identified 17 billion zlotys.

Poland will outline on Tuesday cuts and savings of 17 billion zlotys ($5 bln) it could implement to ensure it remains within its proposed budget deficit if its economy slows, said Prime Minister Donald Tusk.

However, the centre-right government will wait until the second half of the year when the extent of the country's economic slowdown may be clearer before deciding whether to push ahead with the savings plan.

"Everything suggests we will find the 17 billion (zlotys) in cuts and savings," Tusk told a new conference on Saturday after nearly two days of talks with Poland's seventeen ministers.

"So, in the middle of the year we will see if the identified savings and cuts will have to be implemented or if we can go on with the budget approved for 2009."

Tusk's government wants to reduce spending to remain within its planned budget deficit of 18.2 billion zlotys for 2009 -- down from a budget gap of 24.6 billion in 2008 -- despite lower state revenues as the economy slows.

The prime minister said long-term projects would be put off until 2010 or 2011 when Poland's economy would be in a better shape than in 2009, and he also expected to see savings from the withdrawal of Poland's troops from Iraq.

Tusk said was optimistic the government would not have to seek out even more cuts beyond the identified 17 billion zlotys.

Poland's economic growth is expected to slow to about 2 percent this year, analysts say.

Warsaw has said it could lower the 2009 budget growth assumption to 1.7 percent from 3.7 at present. If this happened, it would be the second revision of the targeted growth due to the weakening economy.

Warsaw has repeatedly said it was determined to keep fiscal policy tight to give the central bank space to cut interest rates. The main rate now stands at 4.25 percent after two 75-basis-point cuts in December and January, and a 25 basis point cut in November.