World Bank: Polands Success Is Remarkable, but Further Reforms Are Needed

Stocks and Financial Services Press Releases Wednesday March 22, 2017 09:13
WARSAW--22 Mar--World Bank

WARSAW, 21 March 2017 – Poland's economic ascent is remarkable, but further reforms are needed to meet citizen's expectations for faster convergence with the European Union, says the new World Bank report "Lessons from Poland; Insights for Poland".

"Poland is an outstanding economic and development success story, moving from middle-income to high-income status in record time," said Arup Banerji, World Bank Regional Director for the European Union. "If Poland wants to continue its ascent and meet the rising expectations of citizens, it needs to build on its reform successes - such as prudent fiscal policy - but also initiate new reforms around innovation and progressive labor market regulations and institutions."

How did Poland succeed? After the bold reforms of the transition from communism, Poland got its institutions right – rule of law, property rights, democratic accountability, and basic market institutions. It then used the EU accession process and subsequent EU membership to reinforce them.

A widely-shared vision of a socially responsible market economy provided reform continuity and consistency. Sound macroeconomic policies ensured stability and resilience. Poland was the only European country to record positive growth in 2008—the year of the global crisis—and to completely avoid a banking sector crisis.

Concurrently, the country successfully connected to global and regional markets, while ensuring competition at home. Efficient firms entered the market and created jobs. Workers became more productive thanks to reforms that raised education quality at one of the fastest rates in the OECD countries. Equally impressive were infrastructure improvements, supported by judicious use of generous EU structural funds; the length of motorways has almost quadrupled since the transition.

"Poland's economic growth was also inclusive for different groups of society, including the poorest, which resulted in poverty reduction from 51% in 2005 to 30% in 2014," said Emilia Skrok, World Bank Senior Economist and co-author of the report. "Better access to good education and thriving entrepreneurship with regulatory and institutional support from the government enabled social development and advancement for millions of people in Poland."

Looking Ahead

Looking ahead, the report provides several insights for Poland. First, better governance is needed to build more trust in government by making public services more client-oriented, transparent, and efficient, and involving citizens more directly in governing and public service delivery.

Second, sustaining a sound economy will now require creating fiscal space to deal with the increasing pressures coming from aging of the population and the inevitable decline of European structural funds for investment, as well as a more uncertain global context in future.

Third, ramping up infrastructure investments will allow citizens to continue reaping the benefits of trade.
Fourth, continuing to grow robustly will mean moving Poland up the global value chain by focusing on the quality of products and services and supporting innovation in a more concerted way.

"It's good that the government gives so much consideration to innovations. Without them further dynamic growth of Polish economy will be difficult to maintain," said Carlos Piñerúa, World Bank Country Manager for Poland and the Baltic States. "Other potential growth drivers should be kept in mind. The doing business agenda, more client oriented public services such as healthcare and education, and development of financial sector are the areas where Poland may do even better than before."

Finally, inclusive growth can be further boosted by continuing to expand investment in quality education and healthcare for all; striking a better balance between job security and labor market flexibility; supporting workers between jobs; targeting social spending to aging and vulnerable parts of population; and increasing the progressivity of the tax system.

The report concludes that Poland's vibrant political institutions need to work on rebuilding a broad consensus on the vision and economic strategy for the country - to meet the challenges of the future, while ensuring the long-term policy continuity that has served the country so well in the past.


Latest Press Release

Photo Release: KTC joins EVEANDBOY to celebrate 2019 beauty up to 17% cash back.

"KTC" or Krungthai Card Public Company Limited, by Mr. Sorachach Srilamul, Senior Manager - Credit Card Business, in association with EVEANDBOY, Miss Pluemmanas Panrit, Manager, give special privilege of up to 17% cash back to KTC cardmembers who shop...

Photo Release: Bangkok Bank prepares #Ang Pao envelopes carry the Chinese character #Fu representing #happiness and #luck

Ahead of Chinese New Year, Bangkok Bank has prepared red 'Ang Pao' envelopes depicting auspicious magpies representing good fortune. The envelopes also carry the Chinese character 'Fu' representing 'happiness' and 'luck,' as well as four Chinese words,...

Bangkok Bank reports 2018 net profit of Baht 35,330 million

Thailand's economic growth in 2018 is expected to be 4.1 percent, up from 3.9 percent in 2017. While exports weakened in the second half of the year amid slower world trade and risks from the US trade policies, domestic demand continued to firm up....

TBANK posts fourth consecutive year of earnings growth

Thanachart Bank Public Company Limited generated record earnings of 14,703 million baht in 2018, a 6.5% improvement from last year. Mr. Praphan Anupongongarch, CEO and President of Thanachart Bank Public Company Limited, outlined that "TBank benefited...

TMB unveils TMB Experience

TMB unveils "TMB Experience", new concept branch, offering engaging branch experience that combines digitization with human touch to enable customers to enjoy discovering their real financial needs through 'Avatar' identity creation and exploring...

Related Topics