it's struggling with multi-culturalism. next in our spotlight segment i'll go to north sits down with the former polish deputy prime minister who's the title of best reformer in the european union confesses a potential communist economy into a complex market meconis i'm back mechanism do you stay with us. in the faraway land. where human life is ruled by nature. the. planet earth is scarcely preserved by the poor. animal lie hidden in the deep permafrost. and to those who deal with them restored times are still.

however again a welcome to. the show. today my guest is. in polish recent history the country had a little time to convert its commie planned economy into a complex market that. there had been no precedent as the country needed a qualified and charismatic economist to do the job and here. came up with the idea of shop terror many years later it brought him the title of the best reformer in the european union his former polish deputy prime minister. when communist regimes in eastern europe were close to collapse it was clear that restricted economies wouldn't stand a chance against the free market the need for reform was clear in poland one of the

leading economists. for the package of shock measures later known as the plan it was designed to allow the tradition of a state controlled economy to a market oriented mechanism the shot was immense over a million people lost their jobs but very. clearly there are people have it companies which provided jobs for one point five million people it became the basis of shock there are plans in other communist economies including russia recently the european enterprise institute described plastic box rubbish as the best reformer in the european union. hello mr boult solution welcome to the show thank you very much thank you very much for coming well first of all today you are in the top five on the list of the most popular polish probably attentions but what about the public opinion that

there in the ninety's were you as popular as you had today initially yes because there are expectations and most people wanted to change the system to have low inflation but of course with the passage of time and the turnout they are not on the benefits about those costs my papa has fallen he was fluctuating but now more and more people realize that it was worse transforming a start because in politic on so so what you just said. makes me think that the most difficult thing about reforms in poland maybe also in russia at that time was changing the mentality of the people well was changing changing their expectations there or not i think you have to change the conditions under which people operate and work and you have to do it in a radical way and then people are just many people just as they have your day

started in a new way and some of them adjust their views so i didn't want to try to change mentality because i was not a creature i wanted to change the conditions to improve the conditions for good work for an apprenticeship. for research etc well for for us for journalists i'm an expert in perl and i've i've never written actually a lot about problem but for us there that time was fun i mean great fun i mean poland salad out an arse less well and sour all those crack off and all all those things and so it was i mean real fun real i mean life over there and the blood pumping in so i want to put you know i bet you know the conditions you know what was behind behind these pictures yet so what were the conditions in pearl and was it was it any any similar to what we had in russia during the period when there was

garbage on the screen but nothing nothing in the food stories. we have shortage is extraordinary periods in poland's recent history of the first one ninety eight and two one there was a first solidarity movement which was unprecedented and the communist or socialist because this was the independent organization. and ours had became a hero but it was surprised by the introduction of martial law in december eighty one and then you had nine rather gloomy years. there was not much like the end of the children but it appeared and then there was a compromise of negotiations that round table in poland the creation of the new government with the first non-coms prime minister there was some as obviously and i was asked to take the responsibility for the economic reforms and coming to a question where certainly those hundred tonight and russia. two years later we have a very very difficult dramatic economic condition similar very very high inflation

hyperinflation production was falling. in poland to be have we have very had it in four and. reserves how the exchange was very very low so it was a catastrophic but that was also a great opportunity to study and reform the country. well it's an interesting thing listen when you went to school and when i went to school the only russia but it was it was the same period of time it was becoming a communist rule both in poland russia so the only type of economy we studied was marxist economy and marxist leninist economy so who will you teach here's how did you get an opportunity to learn about the transition to the learn about how what so an economist can do with a plan to save it economy to change it. first of all i was not very good at econ

and political economy social and i was always proud of go to bed a great. second i was interested in other subjects like history the laws of. mathematics thirty health certain the exact science. being able to count years to reason to calculate a very very my best advisors were physicists or mathematician and these are the two forms i never recruited politician columnists who were educated on the source of the problem is and thought pollard was a bit more open. is german and of the promise of a union so he could travel and there was an offer to the possibility to start the united states so you did. education which was called master of public administration business and from your converse of that certainly hope when you were when you were pretty i was the younger sister. called central school of planning

and so this is the also and i was i was offered this opportunity to say spent almost two years in new york. did you have an opportunity to complete your reforms well all that there was in the visit by the by the and delta ravish plan was it all done was it all i have been told by my friend because i have three years initially and with the team saw we have advance basic reforms liberalizing the economist started to boost basic institutions buying stock exchange starting privatization so i was in a better situation proper legal point of view but of course even three years is not enough so i have the second stage between two like ninety seven and two thousand and i have i was also a deputy prime minister we have accelerated some other reforms well in transition

from state to market economy russia to have to go through some very painful reforms spotlight to me that has more in that. words like inflation or unemployment were very distant to reality for the so that people low prices and decent wages were guaranteed by the state starting the nineteen eighties when the world was hit by an oil crisis it was harder and harder to keep things the way they were mikhail gorbachev came up with very strong but the reforms he introduced did not bring relief after the fool of the soviet union the jolts in government came up with the so-called shock therapy the author of the radical reforms he grew gaidar remains a controversial figure for russians in one thousand nine hundred two prices were freed and the savings of millions of people devalued overnight industries had to

adapt to new market economy ruined their lack of state support led to massive job losses millions witnessed into poverty. guider supporters say there was simply no alternative to this type of change to save people money from total disaster in the country from civil war ordinary people had to learn to survive in the new economic reality and some are still unable to be philosophical about the reforms to them it was just two worst time in their lives. you might gorbachev in ninety ninety one the first chance i was the first foreign politician who came with the official visit to russia just after this fate after the coup happened after that i i you talk to him what was his opinion on

the reforms that you were carrying out in poland and he was very polite. also but he was the crazy guy that i don't know i can't somehow but certainly he said he was very much interested in the policy experience he invited me to come later by the next game for the second time it was the second night of our doors or the change in russia i talked to i spoke to two year old son and two you go gaidar interesting event we've discussed what i was russia and tiring to listen is it true that yeltsin when you met him in ninety one was ready to offer you any job any salary if you stayed in russia but you but you but you chose to go to poland is that true i thought this was just supposed very polite way of expressing his appreciation so literally speaking to said but i never considered this to be more than just a very kind. kind words that certainly we have. imported an

interesting conversation. he was at the time in citizen and person. and he asked me what is going to be in phase. and i bought in russia wants to liberalize potent high again for cost that not. theirs was the polish experience though. and says. the former polish deputy prime minister spotlight will be back shortly we'll continue this interview after the short breaks out don't go away stay with us. wealthy british style sign it's time to explain the.

market. has come to. find out what's really happening to the global economy with mike stronger for a no holds barred look at the global financial headlines kinds a report. that's .

welcome back to spotlight i'm al green of and just a reminder my guest in the studio today is less about iran which the former polish deputy prime minister the man who reformed poland in the late one nine hundred eighty s. and the ninety's as a matter of fact lashing the poland's annual growth rate in not in nineteen eighty nine two thousand was i mean the highest in all post communist

economies in the country in guiders russia you said you followed guidance reforms and you met gaidar and yeltsin gorbachev the godless reformers led led russia to the biggest economic slump since world war two so what was the reason the the difference in the initial conditions of the reforms or the methods or maybe something else and i think it's a mistake to blame god as reforms for this recession because a recession was due to documentation of problems under communism distorted economy a man does standard and minimally people have been have to feel nostalgic for these all ties about this old place could not have been maintained it was a collapsing economy first second as they are the knowledge that you have in poland possibilities to introduce small reforms that need russia initially having to do small treatment. economies with problems lack of sick patients so you need

a treatment if you introduce less treatment you have less effects of certain diseases or problems were delayed why why did you have this possibility which go there because the country is bigger wide were it was there was. a huge problem as well in russia where there was even. all you have still you have constitutional problems to the public constitution conflict. the problem of the negotiating falling ball borders saw i think this was the reason i'm asking i'm not blaming it on the guy and i understand it but what i see when i was when i was expecting here in the studio i read about your reforms in there realized that gaidar copied a lot from what you did but not everything worked as smoothly as with as in poland i'm sorry does that mean the events are lessons specifically of polish and russian if you have hyperinflation. you have to act it's very dangerous will be karma and

for the people so you have to act very decisively and quickly this is the safest strategy so we have did it area and without much of the i think there was for political reasons programs and all day in russia does one difference we have liberalized the common much more massively there was lots less liberalization if you liberalise less you have less competition and you have oligarchs more of less competition we have bluegrass much more and you don't have this problems which is far too. politically connected all the gox is it true that poles in general are more business minded than russia and i don't think that they have always been more ready to start making money now no i don't think so that culture matters on march first of all conditions in every society you have enough entropy an area of people so far the differences in conditions for then if you have more regulations less

freedom less opportunity you don't use the potential to the same extent as in countries which have introduced more freedom this is the basic difference you know what some people say they say that they say that you are rich introduce shop terribly and gaidar turned it into shock without terribly knowing about it is more than just i think it sounds good that does not reflect the truth the truth is ok. listen you are here now does that you know i mean the russian must go does that mean the russian policy makers the russian politicians are still they still need your advice they still interested in your experience in poland well this is not my advice personally because i say said sudden universal lessons if you have too much state as an owner that's bad both for the economy and for politics so you have to privatized the true news you d. politicize the economy if you phrase. and it's ten percent

a year like in russia it's too high so the central bank has to lower interest and that's possible we had even i became the central bank in the year two thousand and one inflation also daft ten percent but in five years time we brought it down to two percent so it's possible but there are universal lessons and i don't think it is very difficult to learn about them or what's absolutely crucial it's a political will to draw to use these universal lessons do you think that the main problem with russia is that the economy in russia is too politicized we should be politicized certainly there are problems there usually because of excessive politicization in various ways russia has actually been a very political country you know you. realize. it seems to me that when i read your history that you are on the way a date of one thousand century early twentieth century to become democratic

capitalistic country and something an accident happened and well it didn't work. but now. ok now. there is a good cry out about what you did with your own country or again this parliament proved to be the only eat you country where the current world economic crisis didn't cause an economic slump is it true and what was this published recipe for success if it's true that we have avoided recession meaning negative growth that we had not avoided a slowdown the rate of growth two thousand and eight was five percent decrease fallen to one point seven but not negative still positive why. so combination of sector several factors first we have avoided the credit boom if you have a credit bull then you usually have a blast this was the case in the baltics ins in spain in russia too

there was excessive girls of credit in russia so we had avoided this apps because the central banking problem was pretty conservative and b you sound regulation to all second. we are russia for example depends in exports stand on commodities oil and gas and they and their prices are rising and falling we dock fortunately we don't have so much natural resources in poland so our economy is much more diversified this is the second i think important reason the third one is that policy qana when it comes when you compare polish economy policy can i would the baltics even hunger policy economy is much larger so we depend much stress on foreign shocks rachael's you know. fortunately you don't have a lot of natural resources i once talked to the prime minister of albania and i was amazed when they knew they had a lot of oil you have

a lot of oil in the area have been yeah and i asked him how come there is so so much oil and use the poor and he said you know. when god gave some countries lots of oil he unfortunately didn't give them enough grains and he looked at me. and how terrorists are. patient here they are victim to a ship as a matter of fact some people say that there are predictions that for example saudi oil minister here money said that that that given the political situation well well price can go two to two to three hundred dollars a precision wouldn't be very bad for. produce the shock to important country was not very good the longer around. the world this would strengthen scent of still be less dependent on oil so in the longer run it will do not be very good for exporting countries. so for russia this such such prices could be even damaging

so soon they will weaken incentives to reform what industries are growing today contemporary poland what are the main industries treatment diversified and you could never plan. absolutely no don't try to plan what industries will be successful because this usually favors these national champions are national losers not national chantal's what we do three traits we liberalize but we did not try to divide and shared so that equal conditions so that you can get it then the market. their interest or not are acting under competition. shaping the structure so we are exporting bass at all so all sun electronics furniture foodstuffs etc are very diversified. presidents made very of in russia today large talk about innovation the skulk of the project he says that innovation is the key to success do you agree

do you think that that economic growth should be based on and the variation and doesn't doesn't the japanese example show that it then it's questionable but you know i think innovation is the most importantly universal source of growth barbecue is what to do to have regular innovations and for that you need lots of competition . you need a limited state you need to rule of law so that people would have certain they could confidence trust to invest into research and into investments so you can get innovation basic common if you create the proper into conditions for for that. any solution you can propose to the current euro zone crisis like like is subsidizing poor countries by countries like germany is that the only way out. certainly not the longer term solution. it's useful to stress the eurozone

problems are in fact problems resulting from bad policies for of certain countries greece was weak because they where they were expanding their fiscal expenditures they became bankruptcy it's not the fault of europe but because that's a fault of that policy isn't greece in spain in term there was a. too much credit generated by the practice of course a private sector also there were boom and bossa defect that their fiscal positions or their main conclusion is that you don't mean it so it's not at fault but you don't require much better policies from the members meaning through the mall discipline. that has boom and problems boss and i think the conclusion would be in the respective countries to create better framework for better polish the accidents this is this is interesting i mean a former soviet country minister trying to teach salvia to get only. the sauce

trying to teach the europeans to be this simple and this is a little bit of the blogger who is the most disappointed in europe during this crisis is the baltics above the ball to see they are now also also. soldiers and also acts so there is a lot to keep teaching each day west concerts ok thank you thank you very much for being with us it was fun talking to you just a reminder that my guest in the studio today was less shaken by a set of each in the form of polish deputy prime minister and that's it for now from all of us here will be back with more first time comment on what's going on in and outside russia until then stay on our team and take your thank you thanks to bestival.

basically these dogs are point for not moving false it off a credit ratings giant loses faith in bell as. bonds you as a pawn is left wondering who's next. we just aim a full day down with all the palestinians appeal of being found a new way and israel maintains its opposition and begins reinforcing its borders fearing a wave of protests. a melting pot the good boil over the turkish president's agenda and joining the new group demographics. a very warm welcome to you this is a life from moscow italy's taken a beating from raging as johnstone did.