Where now for the Polish economy?
Most analysts agree that economic growth will be slightly slower than last year, accompanied by weaker exports and enlivened investments. Inflation is likely to increase and the WSE will continue to boom.
But some of the most optimistic predictions are being made on the unemployment front. Deputy Economy Minister Piotr Kulpa said last week that the jobless rate should fall to 14 percent by year end, from its current level of 19 percent. "We expect a substantial improvement in the second half of the year due to a reduction of employment costs, economic growth and the transfer of jobs to Poland from the EU," said Kulpa. However, some analysts characterize the 14 percent figure as pre-election hype.
According to Bohdan Wyznikiewicz, the vice-president of the Institute of the Market Economy Research (IBnGR), GDP growth will increase, but not as much as the five percent suggested by the government.
The rise of the złoty was the success story of 2004, and the scourge of Polish exporters. According to Wyznikiewicz, this situation is unlikely to change drastically: "Unless somebody acts foolishly with economic policy, the złoty will be as strong as it was in 2004."
Public debt also eased in 2004. Last week, Finance Minister Miroslaw Gronicki said that the country's public debt fell below 51 percent of GDP last year, helped by złoty gains and a zł.5 billion undershoot in the budget deficit.
At the end of 2004, Gronicki said, the debt stood at 50.4-50.6 percent, below recent estimates of 52 percent of GDP and well under safety thresholds at 55 and 60 percent, beyond which automatic savings measures would kick in. This is good news for Poland's ambitions of joining the euro, as qualification for eurozone membership demands that public debt be below 60 percent of GDP.
"This good [public debt] figure is the result of a strong złoty, privatisation and a smaller [than planned] deficit," Gronicki told reporters.
The year of the booming bourse was how many described 2004. The stock exchange is expected to continue its strong growth, and although the weak dollar and euro still pose a danger to exporters, the WSE will welcome many new companies. With the privatization of the WSE on the horizon, it seems that the stock exchange is set to go from strength to strength in the near future.
(L.M., A.B., Reuters)
But some of the most optimistic predictions are being made on the unemployment front. Deputy Economy Minister Piotr Kulpa said last week that the jobless rate should fall to 14 percent by year end, from its current level of 19 percent. "We expect a substantial improvement in the second half of the year due to a reduction of employment costs, economic growth and the transfer of jobs to Poland from the EU," said Kulpa. However, some analysts characterize the 14 percent figure as pre-election hype.
According to Bohdan Wyznikiewicz, the vice-president of the Institute of the Market Economy Research (IBnGR), GDP growth will increase, but not as much as the five percent suggested by the government.
The rise of the złoty was the success story of 2004, and the scourge of Polish exporters. According to Wyznikiewicz, this situation is unlikely to change drastically: "Unless somebody acts foolishly with economic policy, the złoty will be as strong as it was in 2004."
Public debt also eased in 2004. Last week, Finance Minister Miroslaw Gronicki said that the country's public debt fell below 51 percent of GDP last year, helped by złoty gains and a zł.5 billion undershoot in the budget deficit.
At the end of 2004, Gronicki said, the debt stood at 50.4-50.6 percent, below recent estimates of 52 percent of GDP and well under safety thresholds at 55 and 60 percent, beyond which automatic savings measures would kick in. This is good news for Poland's ambitions of joining the euro, as qualification for eurozone membership demands that public debt be below 60 percent of GDP.
"This good [public debt] figure is the result of a strong złoty, privatisation and a smaller [than planned] deficit," Gronicki told reporters.
The year of the booming bourse was how many described 2004. The stock exchange is expected to continue its strong growth, and although the weak dollar and euro still pose a danger to exporters, the WSE will welcome many new companies. With the privatization of the WSE on the horizon, it seems that the stock exchange is set to go from strength to strength in the near future.
(L.M., A.B., Reuters)
