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Poland Plans to Shut Unprofitable Factories : East Bloc: Even Lech Walesa has his doubts about the success of his new government’s bold leap into free-economy waters.

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From Times Wire Services

Poland’s Solidarity-led government Thursday announced a radical economic program in which it will start closing unprofitable factories and selling off state property this year.

The program includes an emergency anti-inflation campaign and structural changes to switch from a centralized Communist system to a free-market economy.

Implementation of all major structural changes will be completed by early 1991, according to details of the program issued by the official news agency PAP.

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The Solidarity movement ended 45 years of Communist control of the government in September. Its aim was to “build the market system in the swiftest possible way,” the program said.

Implementing stabilization measures will make possible quick agreements with the International Monetary Fund, the World Bank and Poland’s foreign creditors to release financial aid needed this year to carry out the reforms, it said.

Poland needs a $700-million IMF credit, credits from the industrialized countries to import essential commodities and raw materials, and World Bank credits to finance agreed projects and support structural economic changes.

The government will immediately start a three-month drive to curb the growth of inflation by cutting subsidies and reducing the budget deficit.

This will include checking wage increases, tightening credit and monetary policy, closing selected plants, starting the sale of state property and curbing police and military expenditure.

The government will then launch structural changes in 1990 to create a free-market economy.

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These will include tax, budget and banking reform. The creation of currency, capital, stock and labor markets is seen as “a propelling mechanism in the modernization of the economy.”

A social protection program for the poor, including the issuance of food stamps, will be introduced “to ease burdens stemming from the radical character of the reforms,” the program said.

Meanwhile, at his weekly news conference in Gdansk, Solidarity leader Lech Walesa said Thursday that the independent trade union movement saved Poland from civil war, but he expressed concern whether it can now lead the country out of economic chaos.

He predicted that the worst of the process of rescuing the economy, which is beset by inflation, product shortages and low industrial productivity, could be over in a year, but he said the government will have to do a better job of explaining its policies.

Walesa also said that if the first non-Communist government in the East Bloc, led by Solidarity journalist Tadeusz Mazowiecki as prime minister, fails, “we will have the moral right to accuse the world of not helping us.”

He added: “I claim that it was Solidarity that saved this country from a civil war. Is it capable of saving it now? That’s a question I’m asking myself.

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“I’d like to emphasize that we avoided civil war, and there is a chance for rescue in the nearest future. If society understands this maneuver and joins in, it will all take not more than a year.”

Solidarity, banned after martial law was declared in December, 1981, was relegalized this year after a wave of strikes in August, 1988, brought a series of talks and sweeping reforms in April. The Solidarity-led government came to power in August this year after free elections in June.

Walesa said the new government is not explaining its changing policies well enough.

“When I don’t understand something, it means that at least 60% of the society doesn’t understand it,” the union leader said.

Walesa also said that local government elections, expected to challenge the last bastion of Communist control, should not be held too soon.

“It will only divide the nation, which will concentrate on electoral struggle and not on the reforms that must unite us,” he said.

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