Think-tank predicts GDP contraction in 1st quarter, 1.4% annual growth

Poland's major research institute yesterday forecast the country's economy will contract in the first quarter of this year, marking one of the most bearish outlooks for Eastern Europe's largest economy. The Institute of Market Economy Research (IBnGR), based in the northern city of Gdansk, expects gross domestic product (GDP) to fall 0.4% year-on-year in the January to March period, down from just below 1% growth over the previous nine months. According to IBnGR analysts, "This year will be a hard time for the economy, but it may be the year of breaking through and building strong foundations for development in following years. In the whole of 2002, GDP growth will amount to 1.4%." Poland's growth problems are intensified by surging jobless rates, which the IBnGR sees exceeding 18% this year. This will hurt consumer confidence and further undermine consumption. (Rzec zpospolita, p. B2; Reuters) M.T.