WEBVTT - Daybreak Weekend: Nvidia Preview, Poland Election, BOK Decision 0:00:00.240 --> 0:00:07.760 Bloomberg Audio Studios, Podcasts, radio News. 0:00:10.200 --> 0:00:12.600 This is Bloomberg day Break Weekend, our global look at 0:00:12.600 --> 0:00:14.880 the top stories in the coming week from our Daybreak 0:00:14.880 --> 0:00:17.400 anchors all around the world, and straight ahead on the program, 0:00:17.440 --> 0:00:19.639 we'll look ahead to some key economic data here in 0:00:19.680 --> 0:00:23.119 the US and how that may impact FED policy. I'm 0:00:23.160 --> 0:00:24.600 Tom Busby in New York. 0:00:24.800 --> 0:00:27.280 I'm Krolyn Hepke in London, where we're looking ahead to 0:00:27.320 --> 0:00:30.880 Poland's presidential election and a populist challenger. 0:00:31.280 --> 0:00:34.159 I'm deg Christner with a preview of next week's rate 0:00:34.240 --> 0:00:35.879 decision from the Bank of Korea. 0:00:38.360 --> 0:00:42.440 That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg 0:00:42.440 --> 0:00:46.160 eleven to three, Yeero, New York, Bloomberg ninety nine to one, Washington, DC, 0:00:46.640 --> 0:00:50.840 Bloomberg ninety two to nine, Boston, DAB Digital Radio, London, 0:00:51.320 --> 0:00:54.520 Sirius XM one twenty one, and around the world on 0:00:54.600 --> 0:00:57.760 Bloomberg Radio, dot Com and the Bloomberg Business App. 0:01:02.720 --> 0:01:04.959 Good day to you. I'm Tom Busby. We begin today's 0:01:04.959 --> 0:01:07.880 program with some key economic data in the US, A 0:01:08.000 --> 0:01:10.760 second read on US GDP for the first quarter that 0:01:10.800 --> 0:01:13.160 comes out on Thursday, and the next day, a read 0:01:13.200 --> 0:01:17.640 on inflation with a personal consumption Expenditures Price index the 0:01:17.720 --> 0:01:21.240 PCE for April. Now for more on what to expect 0:01:21.319 --> 0:01:24.319 and how it could impact FED policy, we're joined by 0:01:24.360 --> 0:01:29.000 Stuart paul Us, economist with Bloomberg Economics. Stuart, thank you 0:01:29.040 --> 0:01:31.920 for being here. Let's start with what you're expecting to 0:01:31.959 --> 0:01:34.280 see in the second read. The second read on gross 0:01:34.280 --> 0:01:36.400 domestic product for the first three months of this year, 0:01:36.440 --> 0:01:39.080 because the first one was quite a shock, wasn't it. 0:01:39.200 --> 0:01:41.880 That's right. In the first quarter we saw GDP growth 0:01:41.920 --> 0:01:45.240 decline at an annualized pace of zero point three percent. 0:01:45.280 --> 0:01:48.000 That was a modest downside surprise. Now, a lot of 0:01:48.040 --> 0:01:52.160 attention has been given to this decline in economic activity 0:01:52.200 --> 0:01:54.320 in the first quarter, and a lot of spokespeople for 0:01:54.360 --> 0:01:57.279 the administration are coming out and saying that we should 0:01:57.280 --> 0:02:01.640 anticipate an upward revision to the GDP data. Personally, I 0:02:01.760 --> 0:02:04.720 think that it's a bit optimistic, and I think that 0:02:04.840 --> 0:02:07.720 maybe on a good day, an upward revision of let's say, 0:02:07.960 --> 0:02:13.280 inventories within the GDP tabulation could be enough to lift 0:02:13.320 --> 0:02:16.320 the estimate of first quarter growth, but just to about 0:02:16.440 --> 0:02:19.960 zero percent, so still not a very good reading. A 0:02:19.960 --> 0:02:22.600 lot of folks are really focused on this calculation, this 0:02:22.720 --> 0:02:28.400 accounting for GDP, and they're basically saying, look, trade weighed 0:02:28.440 --> 0:02:31.520 on first quarter growth because there was a surge in imports. 0:02:32.000 --> 0:02:35.120 But those imports are either being held as inventories or 0:02:35.160 --> 0:02:39.000 they were consumed, or they were used in fixed investment 0:02:39.200 --> 0:02:42.919 or machinery or computers, et cetera. And so the drag 0:02:43.600 --> 0:02:46.600 or the subtraction that we get from the trade component 0:02:46.720 --> 0:02:50.840 should just be offsetting what's added by the domestic components. 0:02:51.200 --> 0:02:53.960 But I think that when the administration officials and when 0:02:54.040 --> 0:02:58.880 economic commentators focus on that accounting, they're missing the forest 0:02:58.919 --> 0:03:02.960 for the trees. There was more growth in demand for 0:03:03.240 --> 0:03:07.840 and utilization of stuff from abroad than there was in 0:03:07.919 --> 0:03:12.079 stuff produced and used and created domestically, and I think 0:03:12.080 --> 0:03:14.520 that that's really what's most important. And even if we 0:03:14.560 --> 0:03:19.360 do see this upward revision as a consequence of better 0:03:19.520 --> 0:03:24.280 estimates of inventory growth, for example, that just means that 0:03:24.680 --> 0:03:28.600 inventories are likely to subtract from growth in the quarters ahead. 0:03:28.880 --> 0:03:35.440 So undoubtedly the trade tensions and the higher trade barriers, 0:03:35.680 --> 0:03:39.920 higher economic policy uncertainty is weighing on domestic activity. 0:03:40.440 --> 0:03:43.640 And as you said, this revision at best could just 0:03:43.680 --> 0:03:44.200 be flat. 0:03:44.600 --> 0:03:46.560 I think so. I think that it's going to be 0:03:47.360 --> 0:03:50.840 a pretty soft reading for first quarter growth. And looking ahead, 0:03:52.000 --> 0:03:57.559 we see weakening PMIS, we see elevated economic policy uncertainty. 0:03:58.280 --> 0:04:01.760 There is this sort of relief wave, especially showing up 0:04:01.760 --> 0:04:07.680 in financial markets of the temporarily lowered trade barriers, but 0:04:07.800 --> 0:04:11.119 everything is just on a ninety day delay, and that's 0:04:11.240 --> 0:04:14.400 going to weigh on fixed investment plans and hiring plans. 0:04:15.360 --> 0:04:17.880 And there's also inflation we have to talk about, because 0:04:17.880 --> 0:04:21.479 on Friday is April's PCE, the Fed's preferred measure of 0:04:21.480 --> 0:04:25.080 consumer inflation. Earlier this month, the April Consumer Price Index 0:04:25.200 --> 0:04:27.920 rose just slightly, but it still rose point two percent. 0:04:28.920 --> 0:04:30.720 That was from March, a third month in a row. 0:04:30.800 --> 0:04:32.360 So what are you expecting to see in the pc 0:04:32.800 --> 0:04:34.600 will Will it be anything different? 0:04:35.520 --> 0:04:37.640 This is going to be one of those readings where 0:04:37.640 --> 0:04:40.080 you really need to look under the hood and dissect 0:04:40.120 --> 0:04:43.200 what's going on. As you said, the CPI reading was 0:04:43.240 --> 0:04:47.000 about a touch over zero point two percent. The PCE reading, 0:04:47.080 --> 0:04:49.960 especially the core PCE reading, which matters most for the 0:04:49.960 --> 0:04:53.760 Federal Reserve, is likely to show just one zero point 0:04:53.800 --> 0:04:58.599 one percent growth in prices. So the fed's preferred price 0:04:58.640 --> 0:05:01.520 measure is just going to show zero point one percent 0:05:01.560 --> 0:05:04.640 price growth during the month, and that might allow people 0:05:04.680 --> 0:05:06.839 to breathe a sigh of relief, But what's really going 0:05:06.880 --> 0:05:10.599 on in that core PCE price index is that core 0:05:10.680 --> 0:05:13.920 goods prices are rising because there is some pass through 0:05:13.960 --> 0:05:19.640 from tariffs, but services prices, especially excluding housing, retreated during 0:05:19.720 --> 0:05:24.240 the month. So we estimate that core PCE services excluding 0:05:24.279 --> 0:05:28.359 housing declined about zero point one percent during the month, 0:05:28.960 --> 0:05:33.120 offsetting the effect of higher goods prices. And one of 0:05:33.120 --> 0:05:37.240 the reasons why services prices fell is because the cost 0:05:37.279 --> 0:05:41.760 of financial services in portfolio management services declined in the 0:05:41.800 --> 0:05:45.039 past couple months, and that was due in large part 0:05:45.120 --> 0:05:48.760 to the stock market retreat when trade barriers were going up. Now, 0:05:49.120 --> 0:05:52.279 the rebound that we've seen more recently, especially in late 0:05:52.279 --> 0:05:54.920 April and early May, is just going to mean that 0:05:54.960 --> 0:05:58.000 those services prices are going to start catching up in 0:05:58.080 --> 0:06:01.120 the months ahead, likely two to three months ahead, as 0:06:01.120 --> 0:06:04.000 we get deeper into the spring, at a time when 0:06:04.040 --> 0:06:07.159 firms are also starting to pass through higher costs of 0:06:07.320 --> 0:06:10.520 tariffs and higher input costs. And so even if we 0:06:10.560 --> 0:06:14.400 see a week reading for the headline and for the 0:06:14.400 --> 0:06:17.600 core in the aggregate. When it comes to these inflation measures, 0:06:17.839 --> 0:06:19.719 I think the details under the hood are going to 0:06:19.720 --> 0:06:25.400 be foreshadowing a further deterioration of the economic landscape and 0:06:25.920 --> 0:06:28.440 higher prices, especially in the month's ed well. 0:06:28.440 --> 0:06:31.360 A second read on first quarter GDP out this Thursday. 0:06:31.480 --> 0:06:34.640 PCE for April out on Friday our thanks to Stuart 0:06:34.640 --> 0:06:38.280 paul Us economists with Bloomberg Economics, we turned out to 0:06:38.360 --> 0:06:41.080 earnings and this week we get first quarter results from 0:06:41.080 --> 0:06:44.320 the last of Big Text, Magnificent seven, AI chip maker, 0:06:44.520 --> 0:06:48.240 and Nvidia. The three and a quarter trillion dollars semiconductor 0:06:48.279 --> 0:06:50.680 giant has been facing some of the same challenges a 0:06:50.680 --> 0:06:52.920 lot of other firms are, like the impact of President 0:06:52.960 --> 0:06:56.839 Trump's tariff wars, brief worries about a pullback an enterprise spending, 0:06:56.920 --> 0:07:00.440 and an uncertain economy. It's also had to navigate severe 0:07:00.480 --> 0:07:03.680 restrictions on exports to China and other nations. And for 0:07:03.720 --> 0:07:06.440 more on that and what to expect from in video 0:07:06.520 --> 0:07:10.320 this week, we're joined by Kunjohn Subani, Bloomberg Intelligence Senior 0:07:10.480 --> 0:07:14.080 semiconductor analyst. Boy there is a lot to unpack about 0:07:14.080 --> 0:07:17.640 what Nvidia has been through the last three months, so 0:07:18.440 --> 0:07:21.200 we know that they've talked about a massive charge they're 0:07:21.240 --> 0:07:24.440 taken because of those export restrictions. What are you expecting 0:07:24.480 --> 0:07:26.440 to see in its results this coming Wednesday? 0:07:27.040 --> 0:07:29.440 Yeah, I mean this has been the most noisiest three 0:07:29.480 --> 0:07:32.080 months coming into an earnings call for Nvidia over the 0:07:32.120 --> 0:07:36.480 last two three years. But despite everything both negative and positive, 0:07:36.520 --> 0:07:39.960 we think still again the results will still be similar 0:07:40.000 --> 0:07:42.480 to what we have seen from them, which is a 0:07:42.560 --> 0:07:46.480 strong beat and raise. We don't expect any weakness in 0:07:46.520 --> 0:07:48.960 the reporting numbers or the guidance at all. 0:07:50.280 --> 0:07:54.800 No change then the trajectory, despite what we've seen the 0:07:54.840 --> 0:07:57.680 last three months, the stock losing almost thirty percent of 0:07:57.680 --> 0:08:01.040 its value and then coming back. I mean, what do 0:08:01.080 --> 0:08:03.440 you attribute that to? Is it the new Blackwell chips 0:08:03.480 --> 0:08:05.920 which we know did you know gangbusters in the fourth 0:08:06.000 --> 0:08:06.880 quarter of last year. 0:08:08.240 --> 0:08:10.840 Yeah, it's going to be primarily driven by the strength 0:08:10.880 --> 0:08:13.320 and Blackwell, and we can unpack a little bit the 0:08:13.440 --> 0:08:16.720 negatives and how those are sort of not impacting the 0:08:16.760 --> 0:08:21.560 fundamentals right now. So the couple of concerns right this year, 0:08:21.640 --> 0:08:24.880 we are starting with the Blackwell. There were some hiccups 0:08:24.880 --> 0:08:28.040 in the GB two hundred, which is their first full 0:08:28.240 --> 0:08:29.760 rack level Blackwell. 0:08:29.680 --> 0:08:32.360 Chip or solution that they're shipping right now. 0:08:32.920 --> 0:08:36.480 Those concerns from our channel chicks seems to be mostly abated. 0:08:36.559 --> 0:08:38.920 The shipments are sort of back on track. 0:08:39.040 --> 0:08:41.240 Everything is flowing in, you know. 0:08:41.360 --> 0:08:44.440 And the second big concern was the China restrictions, as 0:08:44.440 --> 0:08:48.040 you pointed out, which for the whole year, the estimate 0:08:48.120 --> 0:08:51.600 of that impact is supposed to be fifteen billion dollars. Now, 0:08:52.440 --> 0:08:55.560 having said that, we think they have other avenues to 0:08:55.720 --> 0:09:00.280 ship Blackwell to other customers as back on time again. Member, 0:09:00.320 --> 0:09:02.880 They're also still shipping the Hopper series, the New Age 0:09:02.920 --> 0:09:06.360 two hundred to other customers. And this product was supply 0:09:06.400 --> 0:09:08.600 continents last year, which is not this year, so they 0:09:08.600 --> 0:09:11.520 can ship a lot more of that if they wanted 0:09:11.520 --> 0:09:14.440 to to meet the numbers. So they have different leavers 0:09:14.800 --> 0:09:18.559 to pull right now to at least get to the 0:09:18.640 --> 0:09:20.640 numbers that the street is guiding to. 0:09:20.960 --> 0:09:23.800 And even though they've said there could be a charge 0:09:23.800 --> 0:09:26.200 of up to five and a half billion dollars just 0:09:26.200 --> 0:09:28.840 from the export restrictions, you still think it's going to 0:09:28.840 --> 0:09:29.920 be a clear beat. 0:09:31.240 --> 0:09:33.720 Well that the charge is sort of a known quantity, 0:09:33.760 --> 0:09:35.959 So I'm taking into consideration the account that it's a 0:09:36.000 --> 0:09:38.880 one time charge not impacting you know, non gap numbers, 0:09:39.000 --> 0:09:39.400 which is. 0:09:39.360 --> 0:09:41.560 What most of the investors really focus on. 0:09:41.800 --> 0:09:45.080 So when you look beyond the charge, having already baked 0:09:45.080 --> 0:09:48.440 that into the numbers, the new sort of baked in 0:09:48.520 --> 0:09:52.000 numbers don't seem to at risk. Also, you know, these 0:09:52.080 --> 0:09:56.360 headfins are likely to become tailwinds in the second half. 0:09:56.640 --> 0:09:59.400 The company is working has announced that it's working on 0:09:59.440 --> 0:10:02.160 a new China variant chip. In the past, they have 0:10:02.240 --> 0:10:05.199 been slapped with these sanctions almost three to four times 0:10:05.200 --> 0:10:08.000 now and every time they've come out, designed the new 0:10:08.080 --> 0:10:12.600 chip which is restriction compliant, and started shipping to China 0:10:12.760 --> 0:10:15.960 very soon, really offsetting the loss of revenue. So we 0:10:16.040 --> 0:10:18.800 think they will still gain back some of these fifteen 0:10:18.880 --> 0:10:21.760 billion dollars in the second half when they start shipping 0:10:21.760 --> 0:10:22.840 the new China variant. 0:10:23.400 --> 0:10:26.000 Now, speaking of new chips, we just wrapped up the 0:10:26.240 --> 0:10:30.280 videos GtC twenty twenty five conference. What is the latest 0:10:30.320 --> 0:10:33.880 on the Blackwell Ultra also the Ruben and the Ruben Ultra. 0:10:35.440 --> 0:10:38.040 Yeah, I mean, look, they've laid out a really impressive 0:10:38.280 --> 0:10:42.080 roadmap for almost a three year roadmap for their next 0:10:42.120 --> 0:10:45.760 coming chips, which you just highlighted more recent than the 0:10:45.800 --> 0:10:50.280 Black GtC was the computext conference, which is actually happening 0:10:51.120 --> 0:10:56.000 or have started this week in Asia, where they made 0:10:56.840 --> 0:10:59.960 even newer announcements about new prout line. One of the 0:11:00.120 --> 0:11:02.360 key ones I want to highlight is that they're opening 0:11:02.480 --> 0:11:07.080 up their Envy Link scale up connectivity system to the 0:11:07.120 --> 0:11:10.640 rest of the semi connector world, which is which is 0:11:10.679 --> 0:11:13.920 a big thing. And just to give some context, one 0:11:14.000 --> 0:11:17.079 of the biggest concerns or risk or pushback from Nvidia's 0:11:17.080 --> 0:11:20.400 customers is that it's a proprietary closed system where you 0:11:20.520 --> 0:11:23.440 have to use Nvidia GPUs and connect them with the 0:11:23.520 --> 0:11:26.439 Nvidia's proprietary and we link to connect all of these 0:11:26.440 --> 0:11:29.800 GPUs together into a cluster. What they have done now 0:11:29.880 --> 0:11:32.600 is basically opened that for the world where you know, 0:11:32.640 --> 0:11:36.280 you can use someone else's CPU to work with Nvidia GPUs. 0:11:36.320 --> 0:11:39.760 You can use your own A six and still get 0:11:39.800 --> 0:11:44.040 this technology the switching gear from Nvidia, use their technology 0:11:44.120 --> 0:11:45.560 to customize your rack. 0:11:45.800 --> 0:11:47.280 What this does is a couple of things. 0:11:47.280 --> 0:11:51.240 One removes these risks and concerned about proprietary ship and 0:11:51.320 --> 0:11:54.400 vendor lock in. Two, it opens up a brand new 0:11:54.960 --> 0:11:57.640 HAAM for in media where they are still part of 0:11:57.720 --> 0:12:01.360 the ecosystem. Even if the Voska scenario, which is a 0:12:01.440 --> 0:12:05.480 six taking OVERGPU, comes through, they still get some wallet 0:12:05.559 --> 0:12:07.920 share out of the hyperscalers and the other customers, and 0:12:07.960 --> 0:12:09.800 they're not completely removed from the stack. 0:12:10.120 --> 0:12:13.240 In Nvidia earnings out this Wednesday, just after Wall Street's 0:12:13.240 --> 0:12:17.199 closing bell our thanks to Kunjan Sabani, Bloomberg Intelligence Senior 0:12:17.320 --> 0:12:20.800 Semiconductor analyst, and coming up on Bloomberg day Break weekend, 0:12:20.800 --> 0:12:24.920 we'll look ahead to Poland's presidential runoff election. I'm Tom Busby, 0:12:25.040 --> 0:12:39.400 and this is Bloomberg. This is Bloomberg day Break weekend, 0:12:39.400 --> 0:12:41.839 our global look ahead at the top stories for investors 0:12:41.840 --> 0:12:44.360 in the coming week. I'm Tom Busby in New York. 0:12:44.600 --> 0:12:46.680 Up later in our program and look ahead to South 0:12:46.760 --> 0:12:51.079 Korea's Central Bank meeting. But first, a presidential election in 0:12:51.120 --> 0:12:54.600 Poland will determine whether that country can restore political stability 0:12:54.960 --> 0:12:58.360 and remain a reliable partner in the European Union. That's 0:12:58.360 --> 0:13:02.360 after nearly a decade of device right wing populism. For more, 0:13:02.760 --> 0:13:04.800 let's get to London and bring in Bloomberg day Break 0:13:04.840 --> 0:13:06.800 euro banker Caroline Hepger. 0:13:06.960 --> 0:13:10.080 Tom the Nationalist Law and Justice Party governed Poland for 0:13:10.120 --> 0:13:13.280 eight years under Prime Minister Donald Tusk, and his Pro 0:13:13.360 --> 0:13:17.360 EU coalition unexpectedly swept into power towards the end of 0:13:17.400 --> 0:13:22.000 twenty twenty three. Now, Tusk is hoping that centrist ally 0:13:22.120 --> 0:13:26.800 and Warsaw Mayor Rafael Tchaskovsky from his Civic Coalition will 0:13:26.880 --> 0:13:31.440 win the presidential poll and help to secure his policy agenda. 0:13:31.679 --> 0:13:36.280 Tchaskovsky edged out Law and Justice rival Carol Navroki in 0:13:36.360 --> 0:13:39.240 the first round vote, with the two men now set 0:13:39.280 --> 0:13:41.720 to take part in a runoff vote on the first 0:13:41.760 --> 0:13:44.760 of June. It's a ballot that will be keenly watched 0:13:44.800 --> 0:13:48.120 across the EU as more of the bloc's members see 0:13:48.160 --> 0:13:51.640 growing populist support. In a moment, we'll discuss what is 0:13:51.720 --> 0:13:55.600 at stake for the Polish presidential election, but first listen 0:13:55.640 --> 0:14:00.360 to this snippet of Europe's top diplomat Kaya Kallas puts 0:14:00.400 --> 0:14:03.680 the issue for Europe clearly. Given the conflicts in the 0:14:03.679 --> 0:14:04.240 Middle East. 0:14:04.720 --> 0:14:10.120 The situation in Gaza is catastrophic. The aid that Israel 0:14:10.280 --> 0:14:14.240 has allowed in is of course welcomed, but it's the 0:14:14.360 --> 0:14:19.400 drop in the ocean. Aid must flow immediately without obstruction 0:14:19.680 --> 0:14:25.280 and at scale, because this is what is needed. I've 0:14:25.400 --> 0:14:28.920 made these points also with my talks with Israelis also 0:14:29.680 --> 0:14:33.720 I've had talks with UN and the regional leaders as well. 0:14:34.480 --> 0:14:39.240 Pressure is necessary to change the situation. It is clear 0:14:39.440 --> 0:14:42.960 from today's discussion that there is a strong majority in 0:14:43.040 --> 0:14:46.960 favor of review of Article two of our association agreement 0:14:47.000 --> 0:14:51.560 with Israel. So we will launch this exercise and in 0:14:51.600 --> 0:14:55.120 the meantime it is up to Israel to unblock the 0:14:55.240 --> 0:15:00.200 humanitarian aid. Saving lives must be our top priority. 0:15:00.880 --> 0:15:03.800 So that was the EU's top diplomat, Kayakala, speaking to 0:15:03.840 --> 0:15:07.560 the press after the recent EU Foreign Affairs Council meeting. 0:15:08.120 --> 0:15:11.440 So which direction will Poland head in next and how 0:15:11.480 --> 0:15:15.040 will its choice affect its neighbors and the EU as 0:15:15.080 --> 0:15:19.160 an institution joining me to discuss is Bloomberg's Brussels deputy 0:15:19.200 --> 0:15:25.920 bureau chief Eva Klukowska and our Poland based reporter Voutech Moskva. 0:15:26.200 --> 0:15:28.120 Welcome to both of you, and thank you for being 0:15:28.160 --> 0:15:32.320 with me. Voutech, Can I start with you? Firstly? You 0:15:32.440 --> 0:15:35.840 get the sense that this is a crossroad moment for Poland. 0:15:36.280 --> 0:15:38.080 Can you talk us through what's at stake? 0:15:38.480 --> 0:15:41.960 This is a big test for liberal Europe. And for 0:15:42.520 --> 0:15:47.360 liberal Poland at steak two different versions of what Poland 0:15:47.640 --> 0:15:51.040 can be and should be within Europe. One vision of 0:15:51.080 --> 0:15:56.520 the Prime Minister took and his candidate is for increased cooperation, 0:15:56.960 --> 0:16:00.680 especially on defense. The other vision is or a halt 0:16:00.880 --> 0:16:05.680 to further integration and for Poland's security to lie solely 0:16:05.720 --> 0:16:08.800 in the hands of NATO and the US. 0:16:08.960 --> 0:16:11.800 The first round in the election was actually incredibly close, 0:16:11.880 --> 0:16:14.680 So what do you think we're expecting this time round. 0:16:15.640 --> 0:16:18.880 It's going to be quite difficult for the Warsaw mayor 0:16:19.080 --> 0:16:23.400 Ravol Saskowsky too to pull this out, it seems because 0:16:23.600 --> 0:16:25.360 the way that the vote has split up. In the 0:16:25.480 --> 0:16:29.600 first round, the far right candidates got more than twenty 0:16:29.600 --> 0:16:33.520 percent of the vote, and these are candidates which are 0:16:34.080 --> 0:16:35.480 generally against the EU. 0:16:35.720 --> 0:16:37.640 They are more likely to back. 0:16:37.680 --> 0:16:42.200 The conservative candidate Karol Navrotsky in the second round. On 0:16:42.280 --> 0:16:45.120 the other hand, the Warsiw mayor is looking to gather 0:16:45.400 --> 0:16:48.440 more moderate and left of center voters. 0:16:48.640 --> 0:16:51.880 Ever, so that's the picture within the country and the voting. 0:16:51.920 --> 0:16:54.920 But what is Poland's position actually in the EU currently? 0:16:54.960 --> 0:16:58.600 Because Prime Minister Donald Tusk, He's had obviously an illustrious 0:16:58.720 --> 0:17:01.760 history and career with the in the EU. He's now 0:17:02.320 --> 0:17:05.000 leading Poland, but you know, we don't know who's going 0:17:05.040 --> 0:17:07.600 to be partnered with in terms of the president. Has 0:17:07.720 --> 0:17:12.320 that contributed Do you think Tusk's history within the EU 0:17:12.840 --> 0:17:15.200 to the country's influence within Europe. 0:17:15.640 --> 0:17:18.639 Let's step back for a moment. Posk was at the 0:17:18.680 --> 0:17:22.120 helm of the European Council for five years between twenty 0:17:22.200 --> 0:17:25.119 fourteen and nineteen, and that is one of the most 0:17:25.119 --> 0:17:28.320 important roles in the EU. It involves turing meetings of 0:17:28.440 --> 0:17:32.199 national leaders and basically setting the political tone for the 0:17:32.200 --> 0:17:36.960 block's agenda. So Posk understands very well the inner workings 0:17:36.960 --> 0:17:40.399 of Brussels, the political nuances and the balance of power. 0:17:41.359 --> 0:17:44.800 Worth noting that he belongs to the European People's Party, 0:17:45.160 --> 0:17:48.240 the biggest political group in the EU. That's also the 0:17:48.240 --> 0:17:52.159 political family of the European Commissioned President or soula vonderlyon 0:17:52.840 --> 0:17:57.960 German Chancellor Friedrich Mertz, as well as the leaders of Sweden, Greece, 0:17:58.200 --> 0:18:02.760 Finland and Austria, to name just a few. Poland is 0:18:02.800 --> 0:18:05.760 among the biggest countries in the EU, which matters a 0:18:05.800 --> 0:18:09.439 lot in the EU voting system. In an actual the 0:18:09.560 --> 0:18:13.159 bigger the population, the more weight a nation has in 0:18:13.280 --> 0:18:16.639 votes on EU laws, and the more it matters for 0:18:16.760 --> 0:18:21.000 other countries when it comes to building political alliances. If 0:18:21.000 --> 0:18:24.439 you combine all those factors, Poland with Tusk at the 0:18:24.440 --> 0:18:26.920 helm of the government, is definitely. 0:18:26.359 --> 0:18:31.320 Influential, okay, influential. And so, how what do you think 0:18:31.320 --> 0:18:36.800 of the standing of Tusk's chosen candidate, Tzaskovsky versus his 0:18:36.960 --> 0:18:41.800 rival Karl Navrotki? Does he have allies? How they positioned 0:18:41.800 --> 0:18:42.639 those two people? 0:18:43.520 --> 0:18:47.640 First of all, Shaskovsky already has some experience in the government. 0:18:47.720 --> 0:18:51.159 He was a minister in the previous government of Donald Tusk. 0:18:51.680 --> 0:18:55.800 Navrotsky is a relatively new candidate. Nobody really knows him. 0:18:56.440 --> 0:19:00.640 His party belongs to the Group of European Conservatives and 0:19:00.760 --> 0:19:04.399 Reformist which is the fourth biggest political family in the 0:19:04.440 --> 0:19:09.159 European Parliament. It's also the group where Italian Prime Minister 0:19:09.280 --> 0:19:13.600 Jeorgia Meloney belongs to. But make no mistake, even if 0:19:13.760 --> 0:19:17.879 very few people know Navrotsky, now if he wins the elections, 0:19:18.200 --> 0:19:20.880 he will become the president of one of the biggest 0:19:20.920 --> 0:19:21.880 EU nations. 0:19:22.280 --> 0:19:25.320 Wow, so voytek In terms of then the campaigning and 0:19:25.359 --> 0:19:29.600 the battleground, I imagine Poland's relationship with the EU has 0:19:29.680 --> 0:19:33.960 come up a lot. What is the view within Poland? 0:19:34.760 --> 0:19:40.600 Yes, EO has been a big campaign topic. Has security. 0:19:40.720 --> 0:19:45.200 Poland is bordering Ukraine, and the Ukraine conflict has already 0:19:45.320 --> 0:19:48.760 kind of spread into Poland. Poland is home to more 0:19:48.800 --> 0:19:51.840 than a million Ukrainian refugees. The main topic is whether 0:19:52.000 --> 0:19:55.720 the European Union can provide a sort of security that's 0:19:55.840 --> 0:19:59.480 needed at a time that US President Donald Trump said 0:19:59.840 --> 0:20:02.600 he wants Europe to take the greater care for itself 0:20:02.640 --> 0:20:06.840 instead of the US providing such guarantees. The other key 0:20:06.920 --> 0:20:11.240 issue is whether Poland will be able to undo some 0:20:11.359 --> 0:20:14.880 of the justice reforms that the previous populist government did 0:20:15.000 --> 0:20:17.359 that have been blocked for the last two years. If 0:20:17.440 --> 0:20:20.399 the government will not have this president as an ally, 0:20:20.640 --> 0:20:24.679 that's not likely, so there may be Nebrotsky victory is 0:20:24.800 --> 0:20:28.000 likely to lead to more tensions between Poland and the EU. 0:20:28.359 --> 0:20:32.359 In terms of the other campaigning issues, Voytek, can you 0:20:32.520 --> 0:20:35.959 talk us through what the economic propositions on both sides are, 0:20:36.040 --> 0:20:39.760 What the other topics are that have emerged in terms 0:20:39.800 --> 0:20:40.680 of the campaigning. 0:20:41.160 --> 0:20:45.760 Poland has one of the fastest growing economies in Europe. 0:20:45.920 --> 0:20:49.679 It's going around three percent a year. But interestingly, we 0:20:49.800 --> 0:20:52.880 haven't really seen that much of a feel good factor 0:20:52.960 --> 0:20:58.520 coming with the fast economic growth because inflation remains stubbornly 0:20:58.600 --> 0:21:02.679 high around the five percent. And a lot of the 0:21:02.760 --> 0:21:07.399 talk during this campaign has been about lowering costs for 0:21:07.760 --> 0:21:13.040 the self employed, payroll costs, deregulation, increasing tax cuts. So 0:21:14.040 --> 0:21:17.840 these are some of the themes that economically Poland is 0:21:17.880 --> 0:21:21.040 looking and I think both of the candidates are generally 0:21:21.320 --> 0:21:25.640 aligned behind lower taxes. It's a question of how they 0:21:25.720 --> 0:21:27.040 plan to get there. 0:21:27.240 --> 0:21:30.679 So that's the domestic issue then perhaps or some of 0:21:30.680 --> 0:21:34.399 the domestic issues. Ever, what's at stake for Brussels in 0:21:34.480 --> 0:21:37.560 terms of this election? I mean, could the eventual winner 0:21:37.720 --> 0:21:41.399 end up wielding, you know, significant power. How do you 0:21:41.440 --> 0:21:44.600 think Brussels is thinking about this election? I mean I 0:21:44.720 --> 0:21:50.119 mentioned the fact that populism is there within Europe but 0:21:50.359 --> 0:21:53.439 has been rising. This will surely be another test of that. 0:21:54.440 --> 0:21:57.040 Let's try to put it a bit in a sort 0:21:57.080 --> 0:22:01.880 of broader context. Whoever wins the elections in Poland will 0:22:01.920 --> 0:22:06.280 have only a limited say on European politics. That's because 0:22:06.359 --> 0:22:09.919 the role of the president under the Polish law is 0:22:10.080 --> 0:22:15.000 largely symbolic, but as Voytek said, he has essay, he 0:22:15.080 --> 0:22:18.640 has the power of a veto. So when it comes 0:22:18.720 --> 0:22:23.080 to domestic legislation, some of the domestic legislation will be 0:22:23.119 --> 0:22:26.800 based on what the Euty sites I decisions. Brussel's decision 0:22:26.840 --> 0:22:30.440 will have to be translated into national laws, and if 0:22:30.520 --> 0:22:33.600 we have a Eurosceptic candidate, he may of course block it. 0:22:34.359 --> 0:22:38.520 There could be also implications for wider European security, given 0:22:38.600 --> 0:22:42.479 that the president in Poland has essay on defense. Poland 0:22:42.560 --> 0:22:45.399 emerged as a key supply route for Western arms and 0:22:45.600 --> 0:22:49.680 aid to Ukraine after the Russian invasion, and Tusk approach 0:22:49.920 --> 0:22:53.320 has been to six stronger ties with key European allies 0:22:53.960 --> 0:22:57.680 and also try to stay on Trump's site by American 0:22:57.880 --> 0:23:01.800 arms and nuclear power technology. Do that the current president 0:23:02.600 --> 0:23:07.919 enjoyed a war relationship with Trump. So if Navrovsky wins, 0:23:08.440 --> 0:23:10.960 or if just Conscu wins, their challenge will be to 0:23:11.080 --> 0:23:12.320 maintain those times. 0:23:13.320 --> 0:23:16.919 Okay, So thinking about the US and President Trump, are 0:23:16.920 --> 0:23:19.639 there any concerns about free and fair voting in the 0:23:19.760 --> 0:23:24.240 upcoming election? I mean, you mentioned at the start democratic 0:23:24.359 --> 0:23:28.560 standards and the concerns that the EU has had in 0:23:28.720 --> 0:23:33.960 recent years with those standards in Poland. What about the 0:23:34.040 --> 0:23:36.399 election in and of itself, No. 0:23:36.560 --> 0:23:39.440 There really hasn't been any There were a lot of 0:23:39.560 --> 0:23:44.399 concerns about the elections when five years ago when Poland 0:23:44.760 --> 0:23:48.399 held them during the COVID pandemic, But this time around 0:23:48.680 --> 0:23:52.600 there is an independent election commission which is running and 0:23:52.760 --> 0:23:56.040 counting the votes, so that is not concern at this time. 0:23:56.680 --> 0:24:00.440 Buytak just lastly thinking about you know what hey come 0:24:00.520 --> 0:24:03.959 in the future and what's at risk perhaps in this election, 0:24:04.200 --> 0:24:05.280 how are you thinking about it? 0:24:06.200 --> 0:24:10.320 If the government does not get its ally into the 0:24:10.400 --> 0:24:14.520