EU Workers European Court of Justice’s Order last Friday sent a powerful message: Poland must play by the rules of European integration, or risk losing them altogether. And if the country’s government continues to wreak havoc on its own citizens by destabilizing the domestic economy, its EU partners will have no choice but to step in and stop it.
The central bank’s governor, an appointee of the ruling Law and Justice party (PiS), terrified financial markets earlier this month by lowering interest rates on the pretext that Poland’s sky-high inflation was finally cooling. That gambit has been more than successful so far, with consumer prices rising by just 8.2 percent year-on-year in September, down from the previous month’s 10.3 percent and below professional forecasts, according to data published on Friday. Specifically, fuel and medicine prices fell sharply by 3.1 percent and 4.1 percent, respectively, which has lowered the overall rate of inflation from 13.6 percent to 8.2 percent.
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But the decline has also triggered political turmoil in the country, with critics accusing energy conglomerate PKN-Orlen—which is 49 percent owned by the state and is the dominant market player in both the power and oil sectors—of deliberately lowering prices for political reasons ahead of next month’s election. And if it is found to have done so, the Commission may be forced to investigate whether PKN-Orlen has breached competition laws by manipulating prices and colluding with competitors in violation of Article 7 of the Treaty on the Functioning of the EU.