POLAND


The 9th largest country in Europe and 69th in the world in terms of size; a nation with a proud cultural heritage

Total area: 312,685 sq km
Population:  38.5 million
Government type: Parliamentary democracy
Administrative division: 16 administrative regions (“voivodships”)
Capital + other major cities: Warsaw (1.7 million) + Lodz (769,000), Krakow (755,000)
Currency: zloty (PLN)
Languages: Polish (official) 96.2%
Ethnicity: Polish 96.9%, Silesian 1.1%, German 0.2%, Ukrainian 0.1%, other & unspecified 1.7%
Religion: Roman Catholic 87.2%, Eastern Orthodox 1.3%, Protestant 0.4%, other 0.4, unspecified 10.8%
President: (Mr.) Andrzej DUDA (since August 2015)
Prime Minister: (Ms.) Beata SZYDLO (since November 2015)
Date of EU accession: 1 May 2004
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KEY FEATURES

  • Largest consumer market in CEE with ever-increasing purchasing power
  • Uninterrupted GDP growth since 1991 – as the only EU member state
  • Strategic location for manufacturing and logistics companies
  • Cost-effective manufacturing centre, qualified & educated labour force
  • Strong inflow of foreign investment (USD 18.7 billion in 2011)
  • Significant differences between regions
  • Rapid expansion of transport infrastructure

MACROECONOMIC OVERVIEW

Poland stands out as one of the most successful and open transition economies in the CEE region. Privatization of small and medium-size firms in early 1990's and liberal law on establishing new firms led to rapid development of a private sector now accounting for 70% of all economic activity.

Poland has been enjoying the longest period of uninterrupted GDP growth in Europe (last recession taking place in 1991). And its GDP kept growing, even in 2009, while the rest of Europe, without exceptions, went down!

Poland was the least hit by the recent global financial crisis, thanks to its large domestic market as well as sound fundamentals at the onset of the crisis: a well-capitalized and sound financial sector, relatively low degree of openness of the economy, and sizeable depreciation of the Polish currency at an early stage of the economic turmoil and also skillfully managing public finances and adopting controversial pension and tax reforms to further bolster public finances.

While the Polish economy has performed well over the past five years, growth slowed in 2012 and 2013, in part due to the ongoing economic difficulties in the euro zone. Poland returned to a higher-figure growth in 2015, when GDP increased by 3.6%; further solid growth is expected in 2016 and 2017, by 3.7 and 3.6%, respectively.

Challenges ahead include consolidation of debt and spending without stifling economic growth and removing obstacles to further expansion, such as deficiencies in its road and rail infrastructure, business environment, rigid labor code, commercial court system, government red tape, and burdensome tax system.


Selected economic indicators, Poland, 2010 - 2016

    2010 2011 2012 2013 2014* 2015 2016*
GDP
Real GDP growth
%
3.9
5.0
1.6
1.3
3.3
3.6
3.7
GDP at current prices
€ bn
361.74
380.18
389.27
394.60
410.86
427.74
Foreign trade
Exports
€ bn
144.81
161.73
172.92
182.71
194.98
211.14
Imports
€ bn
152.15
169.28
174.77
175.15
189.69
199.20
Balance
€ bn
-7.34
-7.56
-1.84
7.56
5.29
11.94
Prices
CPI - average inflation rate
%
2.6
4.3
3.7
0.9
0.1
-0.7
0.0
PPI - industry - average
%
2.2
7.5
3.2
-1.3
-1.5
-2.1
Employment
Registered unemployment
%
9.6
9.6
10.1
10.3
9.0
7.5
6.8
Average monthly gross wage
860
880
895
924
957
992
Exchange rates
PLN/USD average
3.0162
2.9637
3.2556
3.1600
3.1546
3.7712
PLN/EUR average
3.9947
4.1206
4.1847
4.1975
4.1843
4.1841

*2016 - forecast
Source: Eurostat, IMF, Central Statistical Office, Polish Information and Foreign Investment Agency, 2016



STRUCTURE OF ECONOMY


The structure of Polish economy has changed dramatically over the last 15 years. The service sector has gained in importance, and the significance of industry diminished. The changes resulted from a dynamic development of the service sector and profound restructuring of ineffective national industrial companies in Poland in the 1990s. This process was accompanied by the development of modern industrial sectors, which was feasible mainly thanks to strong inflow of foreign investment.


Manufacturing industries
with a combined share of 31% of GDP are strongest in electronics, cars, buses (Autosan, Jelcz, Solaris, Solbus), helicopters (PZL Świdnik), other transportation equipment such as locomotives, planes, ships, military engineering, general metal processing, pharmaceuticals, chemical products as well as lower-value sectors (clothing, furniture and agriculture).


Based on strong agriculture, the highly competitive food & beverage sector accounts for 20% of Poland’s manufacturing output. Poland is a net exporter of processed fruit and vegetables, meat, and dairy products. Processors often rely on imports to supplement domestic supplies of wheat, feed grains, vegetable oil, and protein meals, which are generally insufficient to meet domestic demand. Poland is the leading EU producer of potatoes and rye, one of the world’s largest producers of sugar beets and triticale and the largest producer and exporter of apples in the entire world. For fast-moving consumer goods producers, Poland is the manufacturing hub for the wider EU, and even EMEA (Europe, Middle East and Africa) markets.


White goods & domestic appliances
manufacturing has a long tradition in Poland and has attracted several foreign investors, such as Electrolux, BSH Bosch und Siemes Hausgeraete, Fagor, Indesit, LG, Whirpool, and Samsung Electronics. Poland has become one of European leader for domestic appliance manufacturing with particular growth in the washing machines production. Polish brands successful in foreign markets are mainly represented by Amica and Zelmer.


Defense & military:
Poland has the 5th strongest military strength in Europe (Global Firepower Index) and spends more on defense than any other European power: military expenditures increased by 13% between 2013 and 2014, spending 2.1% of its GDP on the military in 2015. Poland launched an ambitious 10-year defense project in 2015 and will spend USD 42 billion on military upgrades over the next ten years.



EXPORTS & IMPORTS


Since 2000, Poland’s foreign trade increased almost ten-fold. A large portion of imports (total of EUR 177 billion) is in capital goods needed for industrial retooling and manufacturing inputs for production of machinery and transport equipment, chemicals, minerals or fuels.


Poland is less dependent on external trade than most other Central and Eastern European countries due to large internal market. Export/GDP ratio has been decreasing and reaches 49.4%.


With the EU as its largest trading partner accounting for 79% of exports and 70% of imports, Poland exports processed fruit and vegetables, meat, dairy products, electromechanical products, vehicles, aircraft and vessels.


2015 export and import data:




Main import partners:
Germany - 22.6%
China - 11.8%
Russia - 7.6%
Italy - 5.2%
Netherlands - 3.8%


Main export partners:
Germany - 26.9%
United Kingdom - 6.8%
Czech Republic - 6.5%
France - 5.6%
Italy - 4.8%


Poland external trade - 2015




See references for our track record in Poland.



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