Economy
21:04 11 May 2022
Post by: WBJ

Poland needs to invest in firm productivity to spur economic growth

Poland needs to invest in firm productivity to spur economic growth
Source: Twitter (@WorldBankPoland)

In the last thirty years, Poland was one of the fastest-growing economies in the world. To continue to catch up with the advanced economies of Western Europe, the country should support firm productivity improvements through relevant public instruments, including those targeted at small and medium-sized enterprises, according to a new World Bank report. The report was developed in partnership with Statistics Poland, which prepared the data and collaborated with the World Bank team on econometric calculations and analyses. 

Over the last three decades, Poland’s GDP tripled in size, and in 2009 the country achieved high-income status, according to World Bank methodology. Still, with a per capita income at two-thirds of the per capita figure in the ‘old European Union’ member states, Poland has yet to catch up with the countries of western Europe. 

The gap is visible at the individual firm level, too. For instance, an average industrial firm in Poland needs three times more staff than its German counterpart to produce the same product. In addition, the World Bank report reveals that the total factor productivity (TFP) growth in the manufacturing sector in Poland has stagnated since 2012, and the expansion of the manufacturing industry has come predominantly from increasing capital intensity. 

“Despite the turbulence in the world economy caused by the 2008-2009 financial crisis and the COVID-19 pandemic, Poland’s dynamic yet steady development serves as a model of economic success. The country still faces significant challenges, such as addressing low investment levels and the challenge of an aging society. This report highlights that one way to keep the development dynamics is to invest in firm productivity and it presents recommendations in this regard,” Marcus Heinz, Resident Representative of the World Bank in Poland and the Baltic States, said.

(WBJ)


poland
world bank
gdp
marcus heinz

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