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The Warsaw Voice » Business » April 7, 2010
BUSINESS & ECONOMY
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Economy Picks Up Steam
April 7, 2010 By A.R.    
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The Polish economy accelerated at the end of last year. Data from the government's Central Statistical Office (GUS) shows that the country's gross domestic product grew 3.1 percent in the fourth quarter and 1.7 percent in 2009 as a whole.

Poland was the only EU member state to report positive economic growth last year, with all the other member states reporting a GDP contraction-by 5.9 percent on average. This year, Poland will find it more difficult to retain the top spot, experts say, but there is every indication that the upward trend will continue as Poland's economy continues to grow steadily.
While the first three months of last year saw GDP grow by only 0.8 percent, in the second quarter growth accelerated to 1.1 percent, followed by 1.7 percent in the third quarter. In the last three months of the year, the country's GDP grew 3.1 percent, owing mainly to exports, which contributed an estimated 2.2 percentage points to GDP growth, according to the Central Statistical Office. Domestic demand also picked up, helping spur the country's economic growth.
Another piece of good news is that investment is no longer falling dramatically. Last year, it dropped by just 0.3 percent, which was a good result given the deep crisis around the world, experts say. Forecasts for this year suggest that investment in Poland will pick up gradually.
In all likelihood, the first quarter of this year will be less spectacular than the end of 2009. Most experts believe that this year's particularly cold and snowy winter caused the economy to slow down slightly, but that has yet to be reflected by statistics. Preliminary data by the Central Statistical Office indicates that sales in industry this January were 8.5 percent higher than in January 2009, though 5.4 percent lower than in December last year. January 2009 marked a 15.3 percent decline over January 2008. When seasonal factors are excluded, industrial sales in January were 11.1 percent higher than in January 2009 and 2.5 percent higher than in December last year, the office said.
According to the economy ministry, in February industrial sales were around 8 percent higher than in February last year.
In January, sales increased in 22 of 34 sectors compared with January 2009, according to the Central Statistical Office, with computer, electronic and optical device producers reporting 66.7 percent growth, metal industry sales rising by 25.8 percent, and car, trailer and semitrailer sales increasing by 25.2 percent.
The cold weather and snow had little impact on the performance of the energy sector, whose sales were only slightly higher than in January 2009. The weather did, however, have a strong impact on the construction sector at the start of the year. Its sales dropped by 15.3 percent compared with January 2009, which means that the sector's performance, unlike in the past two years, will have a negative effect on economic growth in the first quarter of the year.
Labor market data look less optimistic. According to the Central Statistical Office, unemployment rose to 12.7 percent in January, from 11.9 percent in December.
Retail sales did not live up to expectations and grew by only 2.5 percent in January, while economists had been looking forward to at least 5 percent growth. In December, retail sales were 7.2 percent higher than in December 2008. The January slump is attributed to inclement weather discouraging buyers from visiting stores.
Poland is not the only country where economic trends have improved. The rest of the EU is slowly recovering from the crisis as well, according to the European Commission, which recently released a set of new economic forecasts for the bloc's largest economies. Poland is expected to report the fastest GDP growth this year, at 2.6 percent. The European Commission has revised its previous forecasts of three months ago, when it predicted that the Polish economy would grow no more than 1.8 percent this year. The revision is chiefly due to an expected increase in exports in the wake of a recovery in the global economy.
European Commission experts believe that Poland's economic growth will chiefly be driven by domestic demand. Meanwhile, the country's improving appeal to foreign investors is expected to result in more new projects stimulating the inflow of capital. Last but not least, the economy will grow faster thanks to improved trends on the labor market, economists say.
The European Commission has not changed its forecasts for either the eurozone or the EU as a whole. In the eurozone, economic growth is expected to reach 0.7 percent.

A major Central European economic conference called the Second European Economic Congress (EEC) will be held in the southern Polish city of Katowice April 14-16 under the auspices of European Commission President José Manuel Barroso.
The conference is expected to attract over 3,500 participants, including 400 panelists and many figures with an influence on the European economy. The aim of the event is to provide a platform for initiating direct contact and exchanging experiences among entities from various industries in the European Community.
European Parliament President Jerzy Buzek (pictured) will open the event as honorary chairman of its organizing committee. Other opening day speeches will be made by EU Commissioner for Financial Programming and Budget Janusz Lewandowski, and Deputy Prime Minister and Economy Minister Waldemar Pawlak.
Individual sessions and panel discussions will be attended by Polish government officials including regional development minister El¿bieta Bieñkowska, infrastructure minister Cezary Grabarczyk, Treasury minister Aleksander Grad, environment minister Andrzej Kraszewski, and science and higher education minister Barbara Kudrycka. Those in attendance will also include experts such as former finance minister and central bank chief Leszek Balcerowicz, former prime minister Jan Krzysztof Bielecki, and former justice minister and attorney general Zbigniew Æwi±kalski.
Foreign guests will include Igor Barát, who was the Slovak government's pointman for introducing the euro; Michael Cawley, chief operating officer and deputy chief executive of Ryanair; Czech deputy prime minister for industry and trade Erik Gauss; Wolfgang Fauter, vice-president of Signal Iduna Group; Stephen Gomersall, chief executive for Europe at Hitachi; Per Langer, executive vice-president of Fortum Oyj; Even Toenovsk, vice-president of the EU Commission on Industry, Research and Energy; Maurice Vincent, President of Saint-Etienne Metropolis; and Polish honorary consul in Finland Stefan Widomski, who was formerly vice-president of the Nokia corporation.
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