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UPDATE 2-Polish ERM-2 delay possible due to markets-Finmin

Published 12/17/2008, 01:54 PM

(Updates with meeting's outcome, fresh comment)

WARSAW, Dec 17 (Reuters) - Poland may push back plans to enter the pre-euro ERM-2 currency grid if market conditions do not stabilise, though for now it still aims to join early next year, Finance Minister Jacek Rostowski said on Wednesday.

Analysts say Poland's plan to join the exchange rate mechanism next year and adopt the euro early in 2012 look ambitious in the face of global economic turmoil and domestic political opposition to the plan.

"Our goal is to enter ERM-2 in the first half of the next year," Rostowski told reporters. "We think the markets situation will stabilise by then. If not, we can delay this decision."

A candidate country for euro entry must put its currency into ERM-2, the European exchange rate mechanism, for at least two years prior to adopting the common currency. In ERM-2 a currency moves within a fixed trading range against the euro.

Prime Minister Donald Tusk met with opposition leaders on Wednesday but failed to persuade them to back amending Poland's constitution, a necessary legal step before the country can adopt the common currency.

The head of Tusk's political office Slawomir Nowak told reporters after the meeting the government may yet decide to enter the ERM-2 without changing the constitution if it runs out of other options.

"Entering the currency corridor without changes to constitution is still possible but it would be the last resort," he said.

Jaroslaw Kaczynski, leader of the eurosceptic main opposition party Law and Justice (PiS), reiterated on Wednesday that he would only back such change if voters endorse the government's euro adoption timetable in a referendum.

"If the (referendum) result is positive... we will support the constitutional changes even though we will still think this decision unfortunate," said Kaczynski, who has previously said Poland should join the euro much later than 2012.

Kaczynski, twin brother of Poland's President Lech Kaczynski, added that the referendum should take place together with European Parliament elections due next summer. (Reporting by Pawel Sobczak and Filip Kochan, writing by Piotr Skolimowski, Gabriela Baczynska and Gareth Jones)

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