UPDATE 1-Poland takes over EU presidency at time of crisis

Fri Jul 1, 2011 7:43am EDT

* Poland takes EU helm as bloc battles debt crisis

* Warsaw pins hopes on economic reform, more integration

* EU budget talks, election may stir trouble

(Adds fresh quotes)

By Gabriela Baczynska and Luke Baker

WARSAW, July 1 (Reuters) - Poland takes over the European Union's rotating presidency for the first time on Friday aiming to promote economic reforms and deeper integration in the bloc struggling with debt crisis in the euro zone's peripheries.

Poland, the EU's largest ex-communist member, wants to strengthen the single market that it says underpins Europe's prosperity, to press ahead with enlargement of the bloc into the western Balkans and rebuild trust in the Union's institutions.

Prime Minister Donald Tusk said Warsaw would play an active role to ensure that member states speak openly about challenges facing the bloc related to the debt crisis, or migration.

"Poles don't want politicians who engage in rows with Europe. They want politicians who know how to operate in Europe, who can engage with Europe on a business level and who operate professionally. That's my ambition," Tusk said on Friday.

Poland also wants to finalise Croatia's EU accession, start membership talks with Serbia and clinch a trade deal with Ukraine, as well as promote deeper energy and military cooperation within the bloc.

Poland will hold an election in October, midway through its EU presidency, and some fear the campaign will distract Tusk and his ministers from steering the Union through difficult times.

But opinion polls give Tusk's ruling centrist Civic Platform a strong lead making a change of power unlikely.

The EU's top two officials, European Commission head Jose Manuel Barroso and European Council President Herman van Rompuy, will attend Friday's celebrations in Warsaw marking the launch of Poland's six months at the EU's helm.

SUCCESS STORY

Poland will present itself as a modern EU success story that has achieved strong economic growth since joining the bloc with seven other ex-communist nations in 2004, even avoiding recession during the 2008-09 global financial crisis.

"The Polish presidency is a dream come true for many generations of Poles who hoped for a permanent alliance with the western world of freedom, security, democracy and wealth," Poland's President Bronislaw Komorowski told a special parliament sitting on Friday.

"We have received a lot from the EU over the last few years and now it's time to give as much as possible from what is our strength based on out national success -- we should share our Euro-optimism," he added.

But the huge challenges facing the EU will test Polish optimism and ingenuity to the full in coming months.

EU leaders remain concerned about risks of contagion from the Greek debt crisis to other euro zone countries struggling with large debt piles despite a successful vote in Athens paving way further international help for the country.

Other challenges include difficult negotiations over the EU's next long-term budget, due to start under the Polish presidency. The issue pits poorer countries like Poland that favour generous funds against net contributors to the budget such as Germany and Britain that want to save more money.

Poland, which depends on the highly-polluting coal for almost all its energy needs, also upset Brussels recently by blocking an attempt by all other 26 member states to agree a more ambitious plan to curb the bloc's greenhouse gas emissions. (editing by Mark Heinrich)

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