The new decade will bring a structural shift in Polish investments. During the last ten years, Poland improved mainly road infrastructure. Presently, the challenges include energy transition toward less carbon-intense sources and expansions of railway transport and electromobility. Poland is lagging behind the western economies in the case of digitalization. The EU recovery plans should help Poland improve the infrastructure in these areas.

ANNUAL INVESTMENTS

According to the Global Infrastructure Investment Hub (GIIH), Poland should maintain annual investments in energy infrastructure at an approximate cost of $7.5 billion, highways and expressways at $5 billion, railways at $2 billion and ICT at $4.9 billion. The G20 agenda points that the country meets the target in road transport and to great extent in telecommunication. Still, the structure of the energy sector is obsolete and the number of high-speed rails insufficient. The GIIH suggests an imminent expansion of outlays of $1 billion each in those two sectors.

The country plan will address these priorities related to the “Next Generation EU” (NGEU) recovery and resilience fund. The program contains nearly €24 billion of grants from the common budget. The draft currently proceeded by the parliament assumes €6.4 billion of spending in green energy and improvement of energy efficiency and another €6 billion in rail transport and electromobility during the years 2021-2026. The project stresses the importance of digitalization — nearly €8 billion will be spent on digitalization and the improvement of an innovation-friendly environment. Finally, €4 billion should improve healthcare systems.

POWER SUPPLY

The exemplary energy projects include improvement of energy grids, construction of offshore wind energy farms on the Baltic Sea or hydrogen technologies development. Poland will be actively developing programs related to home installations of renewable energy sources. The project aims to create prosumers in the energy markets, i.e. households should be self-sustainable with their own produced energy and deliver the surpluses to the system.

In the case of transportation, major outlays are assigned to the modernization of train lines and vehicles. The national rail operator will be supported in the introduction of modern connection management systems, which should allow for high-speed travel. Poland is set to expand intermodal transport, which should help exporters expand their activity on the Eurasian markets. Simultaneously, Poland is actively encouraging investment in electric vehicles — its NGEU program assigns funds for developing charging stations and zero-emission transport. The government is considering providing financial support for the improvement of road safety in the small cities — the flagship program assumes the construction of bypass roads around built-up areas.

Finally, Poland is lagging behind the western economies in the case of innovation and digitalization. According to the European Commission’s Innovation Scoreboards, the country is classified as a moderate innovator, similar to other Central European nations and southern European countries. The major obstacles include low financial R&D spending, weak productivity of the academia sector and small incentives for the SME sector to engage in the innovations. The NGEU addresses these problems. Poland will directly finance the work of the Łukasiewicz Research Network, which is focused on the development of advanced manufacturing, chemical innovations and biotechnology. Exemplary programs include providing incentives for bigger companies to engage in new digital products and circular economy. The government is considering providing new e-services, which should lower administrative burdens.  

RECENT PARLIAMENT DRAFT ASSUMES (2021-2026)

• €6.4 billion of spending in green energy and improvement of energy efficiency

• €6 billion in rail transport and electromobility

• nearly €8 billion on digitalization and the improvement of an innovation-friendly environment

• €4 billion on healthcare systems

Jakub Rybacki

The Polish Economic Institute (PIE) is a Warsaw-headquartered public economic think-tank dating back to 1928. Jakub Rybacki, an economic advisor, works for the macroeconomics team at PIE.