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The Warsaw Voice » Business » February 23, 2010
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Economy in Good Shape
February 23, 2010 By Andrzej Ratajczyk   
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Despite the crisis, the Polish economy fared relatively well last year, new data shows. This year the country's economic performance is expected to be stronger. The Central Statistical Office (GUS) estimates that the economy grew 1.7 percent last year, a sharp drop from the 5-percent growth of 2008. But considering how other European economies performed last year, it looks impressive. Poland was the only European Union country with positive growth last year. The economies of the remaining EU countries shrank by 5.9 percent on average. This year it will be more difficult for Poland to retain its position, but there is every indication that the economy will be in reasonable shape. The most optimistic projections put Poland's GDP growth at 3 percent in 2010 and 4.5-5 percent in 2011.

The growth figures are not the only optimistic signals from the Polish economy. Equally optimistic is data indicating that investment has stopped slowing down. Last year, investment shrank in Poland by a mere 0.3 percent, which was a good result at a time of deep crisis. It is projected that investment will pick up this year, although the increase will not be sharp, as indicated by recently published outlook surveys. This situation will not be conducive to job creation. But consumer sentiment is improving. According to the Central Statistical Office, the consumer confidence index has increased for three consecutive quarters. It is a good sign for the Polish economy because it indicates that Poles are not worried by the crisis or its impact on household budgets. Optimistic sentiment drives consumption and stimulates the economy.

Recently good news also came from Poland's central bank (NBP), which has released provisional foreign direct investment (FDI) figures for 2009. According to the NBP, in 2009 foreign companies invested 8.4 billion euros here, 16 percent less than in the last year before the crisis. This proves that the crisis did not result in the kind of massive drop feared by some in FDI flows to Poland.

It is also important that Poland's attractiveness to foreign investors did not weaken. This is confirmed by the latest Foreign Direct Investment Confidence Index league table published by A.T. Kearney. Poland has moved up the league table from 22nd to 6th place, which indicates that the country may see a rise in the inflow of FDI not only from EU countries, which so far have invested the largest sums in Poland, but also from countries that have become new global investors, like China.
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