EUROPEAN COUNCIL: NEW POLISH PRESIDENT OPENS WAY FOR COALITION DEAL.

Last week outgoing Polish President Aleksander Kwasniewski asked Kazimierz Marcinkiewicz, a senior member of PiS, to form a new government following parliamentary elections in September. PiS leader Jaroslaw Kaczynski, the brother of the newly-confirmed president, turned down the post of prime minister, saying it would be inappropriate for two brothers to hold the top political jobs in Poland. Neither PiS nor Civic Platform achieved the necessary 50% majority to form a government on their own, leaving a coalition government the only option.

Mr Marcinkiewicz has been given two weeks to submit a list of cabinet appointments and faces a confidence vote in parliament two weeks after that. However, negotiations had stalled pending the outcome of the second round of presidential elections. Polish sources believe that negotiations would resume on October 26 and could lead to a first list of names by the end of this week or beginninh of the next.

Some names being floated for key positions include a return to the Foreign Ministry for Wladyslaw Bartoszewski who held the office in 1995 and 2000. There have been reports that Polish Vice-President of the European Parliament Jacek Saryusz-Wolski (EPP-ED) could become Europe Minister but Polish sources believe he would turn the job down, having already performed that function in 1991-96 and 2000-01.

In terms of policies, the PiS is much more welfare-orientated than PO and has indicated that some aspects of economic policy would have to be modified. In particular, they...