Poland overview

Poland stadium and cityscape

In Poland we focus on:

Promoting the low carbon economy. Coal still accounts for more than 80 percent of Poland’s primary energy supply and the economy remains among the least energy efficient in the EU. Promoting low carbon solutions, energy efficiency and reduction of green-house gas (GHG) emissions will therefore remain a key strategic priority for the Bank’s operations over the coming years. The Bank will continue to support diversification of energy and fuel supplies (especially in renewable energy) and improving energy efficiency (both on the demand and supply side), together leading toward a more sustainable energy market in the country.

Enhancing the private sector’s role in the economy. The Polish state continues to play a significant role in the economy, notably in the power, chemical, natural resources, transport and municipal sectors. Accelerating the implementation of the structural reform agenda is crucial to consolidate transition and support the recovery that has slowed markedly. The Polish authorities have acknowledged the need to push ahead with greater market liberalisation. Moving Poland toward a more resilient economic model built on private investment and productivity increases will also require more innovation, providing risk capital and corporate restructuring (operational and financial), and will include supporting Polish companies in their regional expansion and cross-border investments.
 
Assisting in the development of a sustainable financial sector and capital markets. Although the banking system remained sound in the course of the crisis, a number of systemic vulnerabilities emerged, especially banks’ balance sheet mismatches, lack of sponsors liquidity support and the need for consolidation. In the current environment, high risk aversion by banks and deteriorating credit quality in the economy are leading to substantial financing constraints, in particular for small and medium sized companies and in the poorest regions. EBRD will assist in the development of a more sustainable financial sector by helping banks address crisis-inherited vulnerabilities and promoting the development of local currency capital markets in order to reduce the sector’s dependence on foreign financial inflows.
 

As well as being a country where the EBRD works, Poland is also an EBRD donor with EUR 2.5 million of contributions. Poland became a donor to the EBRD in 2005, providing Technical Cooperation support in the Western Balkans. It contributes to the Eastern Europe Energy Efficiency and Environment Partnership (E5P). In 2015, Poland also became a donor to the EBRD's Ukraine Stabilisation and Sustainable Growth Multi-Donor Account.                   

The EBRD's latest Poland strategy was adopted on 11 April 2018.
 

Current EBRD forecast for Poland’s Real GDP Growth in 2019:  3.9%

Current EBRD forecast for Poland’s Real GDP Growth in 2020:  3.5%

Poland’s economy grew by 5.1 per cent in 2018, the highest growth rate in central Europe and the Baltic states, then slowed to 4.4 per cent year on year in the first half of 2019. Domestic demand was the principal engine of growth, driven by recovered investment, continuously robust household consumption and especially by strong government consumption, at 4.7 per cent growth in the first half of 2019.
 
Significant wage increases in the economy, averaging 6.7 per cent year on year in the first half of 2019, substantial government transfers and favourable labour market trends have all contributed to sustaining household disposable incomes and consumer confidence. Robust growth will continue but the weakening external environment constitutes a negative risk.
 
The Polish economy is forecast to grow by 3.9 and 3.5 per cent in 2019 and 2020, respectively. Rising household disposable incomes will drive further strong consumption, although the expected generous hikes in minimum wages will be likely to induce higher inflation, boosted by the anticipated rise in energy prices from next year.
 
In addition, if plans to raise the minimum wage to 70 per cent of the average wage within the next five years were to materialise, employment could be hit, especially in small and medium-sized enterprises (SMEs).
 
For the time being, investment will remain supported by substantial inflows of funds from the EU and government-led investments, including those financed by savings in the occupational pension scheme.
 
Nevertheless, the approaching slowdown in Poland’s key trading partners in the EU represents an important risk to that scenario.
 

Poland in the EBRD's 2018-19 Transition report