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The Warsaw Voice » Other » September 2, 2009
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Poland: Velvet Crisis
September 2, 2009   
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Waldemar Pawlak, deputy Prime Minister and Economy Minister: Poland is becoming an increasingly important economic player in Europe. This year, this nation of almost 40 million people in the center of Europe will move ahead of Sweden and Belgium in terms of the size of gross national income.

Paradoxically, Poles have been helped by the global economic crisis. The Polish economy has turned out to be more resistant to recession and better managed than most of the world's developed economies.

Poland is going though a velvet crisis. Obviously, a slowdown from the rapid pace of economic growth recorded in recent years has come as a cold shower for business. But in contrast to Poland, few economies can count on their GDP growing this year, a year of economic gloom.

Polish people have the right to think of themselves as relative winners at a time of crisis because a country where consumption is on the rise, the financial system has not experienced any visible turbulence and structural funds of up to 100 billion euros provide a major shot in the arm for the economy can consider itself a winner. The funds are available and utilized at the best possible moment to keep the economy going.

An analysis of the GDP structure in Poland, the Czech Republic, Hungary and Slovakia shows that Poland is likely to get through the current economic crisis with less damage than the others. The main reason is that domestic consumption is the key factor behind GDP growth in Poland. Domestic consumption is higher in Poland than in any of the neighboring countries. Additionally, the ratio of foreign trade-exports and imports-to GDP is the lowest in Poland. As a result, in the current situation of major falls, especially in exports, Poland has been affected the least.

Poland's stable political and economic situation would not have been attractive by itself without an extensive system of incentives for investors.

The Polish government does not spend money recklessly in an effort to attract investors to the country. Instead, over the course of the years it has built up a reasonable system of instruments, a system that works.

In order to meet investors' expectations halfway, a new system of supporting investment projects of major importance to the Polish economy was worked out last year. It contains instruments that are competitive compared with similar systems used by Poland's neighbors.

In recent years, thanks to active support for investment, Poland has become a leading producer of TV screens and LCDs as a result of major investment projects by Asian companies, and a leading producer of household appliances of almost all of the best known brands. Companies operating in the aerospace sector have invested in Poland in the Aviation Valley, a well-known hub of the aerospace industry. The automotive industry, manufacturing mainly small and medium-sized cars, is also well developed in Poland.

Poland is attracting more and more projects from sectors generating the highest value added, for example the electronics and aerospace industries. The Polish economy is consistently becoming increasingly competitive thanks to the rapid development, especially in the past several years, of modern services based on information technology.

Poland is the largest country in the region and is politically and economically stable, which creates an environment conducive to the success of long-term investment. Polish people account for 24 percent of the total population of the region and generate almost 40 percent of its GDP. This shows how large the potential of the Polish economy is.

Crisis always creates both opportunities and threats.

The Polish government its steadily putting into practice its Stability and Growth Plan, accelerating the use of EU funds in order to limit the effects of turbulence on financial markets and, above all, maintaining public spending discipline. The aim of this policy is to draw investors' attention to the difference between Poland and most other European countries, and to encourage them to see an opportunity for themselves in Poland.
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