Poland – After a 2.5 percent decline in 2020 during the Covid crisis, Poland’s GDP has just experienced two years of sustained growth, confirming the vitality of the Polish economy.
A strong economic rebound after the end of the Covid-related measures
While GDP growth ranged from 1.4 percent to 5.4 percent, with an average of 3.5 percent, between 2012 and 2019, the recession brought about by the Covid-related measures was immediately followed by a rebound with 6.8 percent growth in 2021, the strongest result since 2007. And the Polish economy stayed on track last year, with GDP growth at 4.9 percent.
Nevertheless, according to experts, the figures will deteriorate in 2023, as GDP growth is forecast to fall sharply to less than 1 percent. The reasons given by Bank Millennium, for example, are that “high inflation exceeding nominal wage growth as well as tight monetary policy will drastically reduce domestic demand, especially private consumption.” The sharp slowdown in consumer spending is mainly due to inflation, which has been exacerbated by the war in Ukraine and European sanctions, as well as to consecutive rate hikes by the National Bank of Poland.
For his part, the president of the central bank, Adam Glapiński, estimates that the Polish economy will suffer a brief recession in the first quarter of 2023, something that tax cuts and relief measures on mortgage repayments delayed in 2022.
The best performance in the V4
Poland has in fact weathered the Covid-related economic crisis better than its Visegrád Group partners. Czechia suffered a 5.5 percent decline in GDP in 2020, and its growth was 3.5 percent in 2021 and 2.5 percent in 2022, which means that it was not until the end of last year that the Czech economy returned to its 2019 level. The situation is similar in Slovakia, with GDP down 4.4 percent in 2020 and up only 3 percent in 2021. In Hungary, the fall in GDP was 4.9 percent in 2020, followed by strong growth (7.1 percent) in 2021.