Opinions
• The continuing high rate of consumption growth together with investments are the principal motive force of Poland’s economic growth.
• A high growth rate of wages was registered in 2007 and is continuing in the first half of 2008
• The situation on the labour market is systematically improving, the first months of 2008 forecasting continuation of the positive trends; the deficit of appropriately skilled workers is a real problem
• Rising household earnings in the last few years has led to a reduction of poverty areas in Poland
• Businesses reported better results in 2007 than in the previous year (profitability rose, cost fell) which may be the reason why the number of economic subjects operating on the Polish market has increased; however a major problem facing Polish companies remains the relatively low supply of labour and the resulting demands for pay rises
• Last year the highest rate of growth in industry was reregistered by sales of durable consumer goods and investment products; the level of industrial production is also expected to be high in the next quarterly periods
• The major headache experienced by industrial companies is labour deficit which is forcing employers to give wage hikes; the simultaneous upsurge of all kinds of costs is, however, not causing rising wages to influence a change in cost structure
• Last year the construction industry noted the greatest rise in net revenue from sales of products, goods and materials among the whole production sector (30 pct); that, however, has had no impact on sales profitability which is the outcome of high building materials’ prices and also the intensifying competition in this sector
• The best economic health in the whole services sector is being displayed by financial agencies with outlays growing in those institutions, the number of jobs increasing and the range of orders expanding; companies dealing in real estate services are also having a good period which reflects the situation in the construction industry
• The 2007 rate of investments growth exceeded 20 pct though these were mainly low-cost investments; the percentage of outlays borne by companies with foreign capital fell in the overall value of incurred outlays, the strengthening Polish currency able to consolidate that trend
• Only a very small increase in the amount of railway cargoes was noted, the result of substantial disproportions in the costs of access to the infrastructure compared with road transport; favouring road transport contradicts the idea of sustainable growth of transport
• The outcome of the Strategy for railway transport approved last year is preparation currently proceeding for the partial privatisation of two profit-generating carrier companies of PKP Group while the constantly deficit company PKP Regional Carriages is to be transferred in its entirety to province local governments
• The contribution of regional airports to the rapidly growing air traffic continues to increase; their continued growth urgently requires regulation of property right with military authorities and creating conditions in those airports conducive to competition among fuel suppliers
• The decisive stance taken by the regulator is steadily enlarging the scope of competition on the telecommunications market
• The growth of Poland’s economy is increasing electricity consumption; the aggravation of ecological norms is leading to the inevitable prospect of constructing modern nuclear power stations in Poland
• An excellent result was registered by the central budget in 2007, the deficit being less than that planned in the appropriate Act and amounting to PLN 16.9 bln (56.4 pct of the plan); restricting the deficit was achieved by savings in expenditure (by around PLN 6 bln) and also greater than planned revenue (by around PLN 7 bln)
• Full implementation of subsidies for target funds took place in 2007 in expenditure; a small fall in the rate of servicing costs of the public debt was also noted
• Local governments continue to be the greatest beneficiaries of EU funds, evidenced in the state of implementation of projects financed within the Integrated Operational Programme of Regional Growth
• The national public debt in 2007 was below the first cautionary threshold
• Bank sector assets are rising at more than double the rate of the GNP due to the rapidly expanding loan campaign, particularly mortgage loans; the slower rate of bank deposits growth signifies the end of the banking sector’s overfluidity
• In many aspects 2007 was a highly successful year for the Stock Exchange; the Warsaw Stock Exchange approved a record number of debutants, turnover on the cash and fixed-term markets was the highest ever, capitalisation and dividends achieved record values, progress continued to be made in market internationalisation
• Privatisation of the Stock Exchange planned for 2008 is accompanied by a risk of a change in the purpose of its function, from an institution serving the growth of the Polish financial system into an institution geared to the maximisation of value for shareholders
• Seen against global turbulence, the Polish economy is enjoying a stable situation and no sufficiently strong mechanisms exist which could shift the problems facing the USA to the zone of Poland’s real economy; the growth of Poland’s economy is sustainable and its foundations are relatively firm
• Evaluation studies of operating programmes in the 2004-2006 planning period reveal that those programmes had a negligible influence on the goals of the Lisbon Strategy achieved by Poland; that testifies to the small extent to which the Polish economy is dependent on EU funds
• The European Commission has commenced the process of assessing how the Common Agricultural Police reformed in 2003 is functioning; the Commission introductory proposals of November 2007, especially the suggestion to reopen the debate on restricting the rights to direct payments for the smallest farms, could have far-reaching implications for Poland. 

Forecasts

• The growth of the GNP will be slower in 2008 than last year and reach around 5.7%. The growth rate was the greatest in the first quarter of the current year when the GNP rose by 5.9%, to fall in successive three months periods amounting to 5.7% in the II quarter and slowly falling by 0.1% in the next periods. The motive force of the growth rate remains domestic demand which will be around 7.4% for the whole of 2008.

• The growth rate of gross outlays on fixed assets will rather be stable in 2008, remaining relatively high but not exceeding the rate registered last year; the growth rate of capital outlays for the whole of 2008 should be around 18%.
• Exports will continue to rise at a slower rate than that of imports in 2008 which is bound to increase the foreign trade deficit.

• Wages will continue to rise relatively rapidly in 2008, the growth rate expected to exceed 5.5%..

• Growth of industrial production in 2008 will be stable, though below that in 2007; industrial production is to rise by an average figure of around 8.1%, that is more than 1.5% below the 2007 performance

• The situation on the labour market in 2008 will be good; for the first time in 10 years registered unemployment will fall to single figures and amount to 9% in the second half of the year.

• The pressure exerted by mounting inflation will be a serious problem for the Polish economy over the next quarters. The CPI index will settle at above 4% which will incline the Monetary Policy Council to tighten the national monetary policy with two further basic interest rate increases expected in 2008.