Lack of investment blamed for near-record high Russian-Polish trade deficit

The trade deficit with Russia probably exceeded $3.7 billion last year, close to the record-breaking deficit reached in 2000, according to estimates by Prawo i Gospodarka. Polish investment in Russia has been marginal in recent years, while Russian entrepreneurs have placed over $1.2 billion in foreign direct investment in Poland. Although the increase in the Russian-Polish deficit gap has slowed, it is not due to increasing exports to Russia, but to a decrease in prices of resources imported from that country. Polish investment in Russia continues to be low, at around $1 billion last year. Representatives of the business community believe that the lack of an agreement on mutual support and protection of investments is an obstacle. An agreement was signed in 1992 but so far has not been ratified by Russia. Poland has not been able to return to the good position it had with respect to exports to Russia before the Russian crisis of 1998, at which time Russia was second or third in the rankings of the biggest recipients of Polish goods. (Prawo i Gospodarka, p. 3) P.W.