15:11 24 June 2024
EC will require Poland to reduce deficit by 0.8% of GDP annually for four years
According to Citi Handlowy, given Poland's current fiscal trajectory, the European Commission (EC) will require Poland to reduce its deficit by approximately 0.8% of GDP annually over the next four years. This requirement is part of potential measures under the Excessive Deficit Procedure (EDP), which could be triggered for Poland. If Poland can justify the need, especially related to defense spending and securing the eastern border as investments in European security, the EC might allow spreading the deficit reduction over seven years.
This flexibility could reduce the annual fiscal adjustment to around 0.5% of GDP if extended, aligning with Poland's existing plans and possibly accommodating electoral calendars.
