Five priorities for Poland
1 February 2021
Before the pandemic, Poland’s economic performance was stellar: living standards were converging rapidly to the levels of the most advanced OECD countries, and the unemployment and poverty rates were at historically low levels, and well below the OECD average. As elsewhere, the COVID-19 crisis sharply disrupted the country’s development path. However, Poland has done well at limiting economic losses so far and we expect GDP to fall by 3.5% this year before rebounding by 2.9% in 2021 and 3.8% in 2022.
Thanks to fiscal and monetary support, the downturn was smaller than in most OECD countries. Direct fiscal support – such as emergency funds for healthcare and assistance for households and firms – will amount to around 5.2% of GDP in 2020. Taking into account also the so-called “Financial Shield”, notably comprising credit guarantees, the government has offered about 10% of GDP in direct or indirect fiscal support. The Central Bank reduced its policy rate to 0.1%, and introduced unprecedented quantitative easing. If economic conditions weaken again, the authorities should ease fiscal and monetary policies further.