EC cuts its 2005 growth forecast for Poland down to 4.4%

According to the EC, the economy will grow by 4.4% instead of 4.9% envisaged half a year ago. In 2006 GDP is expected to stand at 4.5%. The structure of the GDP will also change and domestic demand will replace exports, as the main driver of the economy, with increasing investments also taking on a more important role, which are likely rise by roughly 10% in 2005 and 2006. This will be related to the inflow of EU funds. The EC report believes that exports and imports will keep on growing, thus the current account deficit will increase from 1.5% of GDP in 2004 to 2.4% and 3% this and next year respectively. The EC is not too upbeat about employment prospects and envisages that unemployment might drop to 17.6% in 2006. (Parkiet, p. 7) M.M.