Poland flag Poland: Economic outline

Economic Outline

Economic Indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Poland has emerged as a dynamic market over the past 25 years and has become a major actor within Europe, being the tenth-largest economy in the EU. The country recovered well from the global Covid-19-induced crisis, with GDP returning to its pre-pandemic level already in the second quarter of 2021. Overall, the Polish economy grew an estimated 5.1% over the year, underpinned by increased consumer spending and investment (IMF). With the country’s main trading partners gradually recovering, dynamic private consumption, and increased companies’ investment, economic growth is expected to remain strong this year (+5.1%) and in 2023 (3.5%) according to the latest IMF forecast, though much will depend on the global economic and sanitary recovery.

An expansionary fiscal policy – which included the decision to lower the retirement age and increase transfers to pensioners and households with children - has been deepening the public deficit in recent years, a trend that was accelerated by the COVID-19-induced crisis: the general government budget was negative by 4% of GDP in 2021, mostly due to the cost of measures to contain the impact of the pandemic and of a one-off additional pension payment, which is estimated to have caused an increase in the 2021 headline deficit of almost 0.5% of GDP alone. Nevertheless, government revenues have been increasing and will benefit from resumed consumption and the favourable labour market conditions in 2022, with the deficit forecasted to stabilize around 2% this year and the next (IMF). Though still relatively low, debt-to-GDP ratio also saw an increase in the last couple of years, jumping to 55.5% in 2021 from a pre-pandemic level of 45.6%. Sustained economic growth should contribute to a decline in the ratio, to 53.3% this year and 52.1% in 2023. Rising energy prices, growing demand and supply-side bottlenecks have contributed to a steady and robust hike in inflation, which stood at 4.4% in 2021. The IMF expects inflation to gradually ease over the forecast horizon, landing at 2.8% in 2023. Nevertheless, the European Commission warns that a higher-than-expected increase in inflation arising from supply constraints and labour shortages may weigh on purchasing power and private consumption growth.

The unemployment rate has been structurally low in recent years (just above 3%), though more than one in four employees have temporary contracts, twice the EU average. The labour market has proved resilient to the crisis, although emerging labour shortages could act as a significant drag on employment growth in the near future (in 2022, minimum wage rises and tax changes associated with the “Polish Deal” fiscal stimulus programme will add to wage pressures). After reaching 3.5% in 2021, the IMF forecasts a drop in unemployment to 3.2% in 2022 and 3% the following year. The GDP per capita (PPP) of Polish citizens was USD 35,957 in 2021, still 23.3% lower than that of the EU-27 (data IMF). Finally, there are still large disparities between the east and the west of the country.

 
Main Indicators 20202021 (e)2022 (e)2023 (e)2024 (e)
GDP (billions USD) 599.80679.07716.31753.88811.19
GDP (Constant Prices, Annual % Change) -2.25.93.80.53.1
GDP per Capita (USD) 1517192021
General Government Balance (in % of GDP) -6.6-3.1-4.2-3.7-4.6
General Government Gross Debt (in % of GDP) 57.153.848.745.146.2
Inflation Rate (%) 3.45.113.814.34.3
Unemployment Rate (% of the Labour Force) 3.23.42.83.23.4
Current Account (billions USD) 17.32-4.57-28.79-25.09-22.94
Current Account (in % of GDP) 2.9-0.7-4.0-3.3-2.8

Source: IMF – World Economic Outlook Database, 2016

Note: (e) Estimated Data

 
Monetary Indicators 20162017201820192020
Polish Zloty (PLN) - Average Annual Exchange Rate For 1 GHS 0.990.870.790.730.70

Source: World Bank, 2015

 

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Latest Update: November 2022