17:46 21 June 2022
Poland's real public debt reaches 70% of GDP
There is currently a discussion about the size of the public debt and the limit imposed by the Constitution, namely 60 percent of GDP. Changing the constitutional limit is not a good idea because it is only through discipline that we can keep an eye on the public debt so that it does not grow unbridled. That is why we should cautiously accept proposals recommending excluding defense spending from this pool.
"In Poland, the public debt has long exceeded 50 percent. An increase in this ratio beyond the constitutional limits would devastate the economy. Unfortunately, as unique needs arise – we've had a pandemic recently, now there's been additional defense spending – the temptation arises to get additional funds outside the legal roadblocks," Piotr Soroczyński, chief economist at the National Chamber of Commerce (KIG), said.
"These additional funds, which have already been spent beyond the allowed public debt limit, are probably about a dozen percent of GDP. So Poland's real public debt is not over 50 percent, but about 15 percent more, or almost 70 percent. Thinking about further defense spending outside the public debt limit could increase Poland's debt by several percent of GDP," Soroczynski explained.
