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Poland's economy bests its neighors'

Poland avoided recession in 2009 and forecasts growth for 2010.

Poland's Prime Minister Donald Tusk, right, and Finance Minister Jacek Rostowski listen to questions at the Warsaw Stock Exchange Nov. 30, 2009. (Peter Andrews/Reuters)

WARSAW, Poland — For most of the world, 2009 was a year best forgotten, but in Poland it was a year of enormous success, leaving the country the only member of the European Union not to fall into a recession during the global economic crisis.

“We are aware of how large a difference it is to live in a country hit by the financial crisis with living in a country which is passing though this time with stability,” Donald Tusk, the prime minister, said in his final news conference of the year. “During this year, when I was visiting other capitals, everywhere I would see envy in the eyes of our foreign partners, that my capital was Warsaw and that I had the job of being prime minister of a country which was the best able in Europe to deal with the crisis.”

And 2010 promises to be similarly outstanding, with most predictions calling for Poland to again have the fastest growth in the EU. Poland's finance ministry expects growth next year to come in at 1.5 to 2 percent, but most economists think that number is very conservative. A member of the central bank's interest rate-setting Monetary Policy Council recently predicted the economy would expand by as much as 4 percent in 2010.

“The year will be better than we expect,” Tusk said. “That doesn't mean it will be paradise on earth, because on a global and European scale it will still be a difficult year.”

Poland's performance has even surprised professional optimists like Jacek Rostowski, the finance minister, who notes that the country is doing far better than usual when measured against the performance of neighbors like Germany. Normally, Poland has grown by about 4 percentage points faster than much wealthier Germany, which is to be expected for an economy catching up to Western standards of living after more than four decades under communism.

But in 2009, Germany's economy is expected to shrink by about 5 percent, while Poland's central bank thinks that Poland will do better than 2 percent expansion in 2009 — which makes Poland's growth rate about 7 percentage points faster than Germany's.

Rostowski calls that difference “extraordinary.”

That sort of a gap will not be repeated in 2010, as Germany is expected to grow by about 1.6 percent in 2010, but Poland's economy will continue its steady climb.

http://www.globalpost.com/dispatch/poland/100104/poland-economy-economic-growth