Growth beats forecasts

Economic expansion was slightly higher than forecast in the fourth quarter of 2005, indicating that Poland is on a fast growth track. Although consumption increased, it failed to meet analysts' predictions.

According to figures released by the Central Statistical Office, GDP grew 4.2 percent in Q4 2005 and 3.2 percent all year. The Q4 figure is just above market expectations, which had predicted growth of 4.1 percent.

Domestic demand rose five percent compared to 1.6 percent in Q3. This figure is expected to strengthen further in the coming year reducing reliance on exports.

Consumption produced the only below-par result, with a moderate rise of  3.3 percent.  But, on a positive note, investments surged to 9.8 percent, showing the strongest growth since 1998.

Analysts forecast that these favorable results will help GDP continue to grow in 2006. "Growth in the first quarter [of 2006] should be around 4.5 percent and there is a chance that investments will rise again by around 10 percent," Jacek Wisniewski, chief economist at Raiffeisen Bank in Warsaw, said. (Reuters)