Economic signals mixed but analysts up-beat about sustainable future growth

Analysts have finally managed to find some evidence of economic growth after months of waiting, but economists warn that positive signs must first be supported by reality and that they can still not be clearly seen. However, economists highlight as good indicators the fall and stabilization of inflation, the stability of export growth, the improving situation for industry and the high rate of growth in value added products in the service sector. According to the same experts, the negative signs are the poor condition of the construction sector and negative rate of growth in its value added components, a decrease in investment spending and the increasing unemployment figures. The structure of financing the budget deficit is getting much worse, however, and there is also a shift away from direct foreign investments towards portfolio investments. "In order to maintain the required 4-5% rate of economic growth, Poland needs to maintain a sustained level of investment at the rate of 20%-30% of GDP, while in 2002 it has already dropped below the 20% mark," said Katarzyna Strzala from the Market Economy Research Institute (IBnGR). (Prawo i Gospodarka, p. 8; Rzeczpospolita, p. B5) M.M.