Prices Rise in Poland as Shift to Free-Market Economy Starts

Bus fares and gasoline doubled in price and electricity quadrupled Monday under a radical plan by the non-Communist government to transform Poland’s centrally planned economy to capitalism.

The price of coal, a major source of heat in Polish homes, officially increased by 600%, the cost of electricity by 400% and the price of heating gas by 400%.

Rail and intercity bus passengers found that ticket prices had gone up an average of 250%, while the price of municipal bus tickets doubled.

Most gasoline stations were shut for the New Year’s holiday. However, those open were selling regular gasoline for 2,400 zlotys per liter, up from 1,200 zlotys.

Finance Minister Leszek Balcerowicz acknowledged that there will be hardships in the coming months. However, he stressed that the increases are needed to halt Poland’s 900% annual inflation and to end the nation’s economic decline.

“There are no solutions devoid of risk,” the official news agency PAP quoted him as saying.

The far-reaching plan is intended to supplant the centrally directed economy run by the Communists during their four-decade rule. But there is concern that the economic shock will be too much for Poles, who earn an average monthly wage of 350,000 zlotys ($37).