Conservative Lech Kaczynski won Poland's presidential run-off on Sunday on a platform combining traditionalist Catholic values with promises to curb corruption and shore up the welfare state.
Partial results showed Kaczynski, a tough-on-crime Warsaw mayor, captured more than 54 percent of the vote, an eight-point advantage over his pro-business ally-turned-rival Donald Tusk.
Kaczynski's victory seals a swing to the right in the European Union's biggest ex-communist newcomer after his Law and Justice and Tusk's moderate Civic Platform crushed the ruling left in general elections last month.
A moderate nationalist who is wary of deeper European integration, Kaczynski replaces veteran leftist Aleksander Kwasniewski, who could not run after two five-year terms.
Kaczynski said that the EU newcomer may hold a referendum on adopting the euro in 2010.
"The question of the euro should be resolved through a referendum, which could take place in 2010," Kaczynski told Reuters in a brief interview.
Kaczynski has expressed reservations about euro zone entry, but said the referendum was necessary because adopting the single currency meant giving up part of national sovereignty.
The race between Tusk and Kaczynski, former activists in the pro-democracy Solidarity movement that toppled communism in 1989, became a plebiscite on whether the country of 38 million needs more free-market medicine or more welfare.
Kaczynski, who portrayed Tusk as a heartless free-market zealot, extended an olive branch to his defeated rival. He urged him to join forces in government after coalition talks between their center-right parties stalled during the campaign.
"I want to call ... for us to quickly conclude work on the government. I will approach Donald Tusk, who fought superbly in this campaign," Kaczynski told supporters.
FOURTH REPUBLIC
In the presidential and parliamentary campaigns, the Kaczynskis combined patriotic rhetoric and traditional Christian values with skepticism of free markets -- a message which appealed to many poor, less educated Poles.
They promised to build a "Fourth Republic" in a clean break with the corruption that characterized the post-communist "Third Republic".
Sleaze and political patronage peaked during the four-year rule of the social democrats, whose popularity sunk to an all-time low despite their success in bringing Poland into the EU.
Transparency International rates Poland the most corrupt nation in Europe, putting it in 70th place in its 2005 ranking of perceptions of corruption worldwide.
The double crown won by Law and Justice in both elections is a sweet reward for the Kaczynski twins, 56, after years of never quite making it to the top in politics.
The former child-stars of a popular 1962 movie called "The Two Who Stole The Moon", the brothers were kingmakers in previous center-right governments but were shunned for top posts due to their combative, all-or-nothing style.
The president is commander-in-chief of the army, can propose or veto legislation, nominate prime ministers -- who hold most executive power -- and, in some cases, dissolve parliament.
He influences the government's foreign policy, a field where Kaczynski faces a steep challenge after irking big neighbors Germany and Russia with scathing remarks during the campaign.
He has raised eyebrows in Europe by courting the religious right with his anti-gay remarks and pro-death penalty talk.
GOVERNMENT TALKS
The financial markets rooted for Tusk, seeing him as a counterbalance to Kaczynski's ambivalence about the need for fiscal reforms and liberal economic policies.
Analysts expect the zloty and Polish bonds to dip on Monday but losses will not be deep if coalition talks make headway.
"The main focus remains the coalition talks and the market still basically trusts that the two parties will come to some sort of a compromise," said Tania Kotsos, currency strategist with RBC in London.
Tusk's Civic Platform said they will not give up on their campaign pledge to lower taxes and cut red tape to spur growth and reduce Poland's 18 percent unemployment, the EU's highest.
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