Economic and Political Overview

flag Poland Poland: Economic and Political Overview

In this page: Economic Outline | Political Outline | COVID-19 Country Response


Economic Outline

Economic Overview

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Poland has emerged as a dynamic market over the past 25 years and has become a major actor within Europe, being the tenth-largest economy in the EU. The country recovered well from the global Covid-19-induced crisis, with GDP returning to its pre-pandemic level already in the second quarter of 2021. In 2022, the Polish economy grew an estimated 3.8% with industrial output and retail sales expanding at a solid pace in the first semester of the year. Private consumption also grew, partly boosted by Ukrainian refugee spending and by the recovery from the pandemic, but investment slowed sharply. Economic growth is set to turn negative at the beginning of 2023 due to elevated cost pressures and increasing financing costs. However, private consumption is expected to remain strong and overall growth should pick up over the year, with the IMF expecting GDP growth to enter positive territory (+0.5%). In 2024, the easing of supply bottlenecks should support exports, with growth forecasted at 3.1%.

An expansionary fiscal policy and income tax cuts lead to an increase in the general government deficit in 2022, estimated at 4.2% of GDP (was 3.1% one year earlier). The measures taken to mitigate the impact of rising energy prices included the lowering of VAT rates, cash heating subsidies to households, and a multi-annual support scheme for energy-intensive industries and weighted for around 2.1% of GDP. Despite a multi-annual programme of investment in defence that should increase spending in this area up to 3% of GDP per year, the IMF sees a lower budget deficit in 2023 (3.7% of GDP). The country’s debt-to-GDP ratio is relatively low and was estimated at 48.7% in 2022. It is forecast to decrease further this year (to 45.1%) before picking up again in 2024 (46.2% - IMF). Rising energy prices, growing demand and supply-side bottlenecks have contributed to a steady and robust hike in inflation, which reached a record-high level of 13.8% in 2022. Continued wage growth, the pass-through of elevated energy prices, and significant policy support are set to continue fuelling core inflation, which is projected at 14.3% in 2023, before it decelerates to 4.3% towards the end of 2024.
The unemployment rate has been structurally low in recent years (just above 3%), though around one in four employees have temporary contracts, twice the EU average. The labour market has proved resilient to the crisis, although emerging labour shortages could act as a significant drag on employment growth in the near future. In 2022, minimum wage rises and tax changes associated with the “Polish Deal” fiscal stimulus programme added to wage pressures but partly helped households purchasing power. Nevertheless, the European Commission warns that a higher-than-expected increase in inflation arising from supply constraints and labour shortages may weigh on purchasing power and private consumption growth. The average unemployment rate stood at 2.8% in 2022 and is seen to increase only slightly over the forecast horizon, to 3.2% this year and 3.4% in 2024 (IMF). The GDP per capita (PPP) of Polish citizens was USD 42,466 in 2022, still 21.3% lower than that of the EU-27 (data IMF). Finally, there are still large disparities between the east and the west of the country.

Main Indicators 202020212022 (E)2023 (E)2024 (E)
GDP (billions USD) 599.46679.52688.30748.89800.48
GDP (Constant Prices, Annual % Change) -
GDP per Capita (USD) 15,79317,95818,28019,91321,315
General Government Balance (in % of GDP) -6.5-1.8-3.9-4.4-3.8
General Government Gross Debt (in % of GDP) 57.253.849.650.751.7
Inflation Rate (%)
Unemployment Rate (% of the Labour Force)
Current Account (billions USD) 14.88-9.49-21.69-18.08-16.97
Current Account (in % of GDP) 2.5-1.4-3.2-2.4-2.1

Source: IMF – World Economic Outlook Database, Latest data available.

Note : (E) Estimated data


Main Sectors of Industry

In Poland, agriculture employs 9% of the active population and contributes about 2.2% of GDP (World Bank, latest data available). More than 60% of Poland’s total land area is taken up by farming, and the country is generally self-sufficient in terms of its food supply. The sown area in 2021 was 10.9 million ha, the main crops being rye, potatoes, beetroot, wheat and dairy products. Poland also breeds pigs and sheep in livestock farming. The country is relatively rich in natural resources and the main minerals produced are coal, sulphur, copper, lead and zinc. According to the Polish Agricultural Market Agency (ARR), there are roughly 1.5 million small family farms of less than 9 ha in the country, and the average area of agricultural land of farms amounts to 11.1 ha. Around 20,000 farms use organic farming production methods (Statistics Poland – latest data).

The industry sector comprises 27.9% of GDP and employs 32% of the workforce. The World Bank estimates that the manufacturing industry's value-added accounts for 17% of the Polish GDP (latest data available). The country's main industrial sectors are machine manufacturing, telecommunications, environment, transport, construction, industrial food processing and IT. Some of the traditional sectors have been in decline, such as the steel and shipbuilding industries. The Polish automobile industry is mainly export-oriented and had been highly resistant to the effects of the 2008 economic crisis; however, it has been the worst-hit domestic sector in the coronavirus pandemic (also due to the chip shortages). In recent years, the country has diversified its manufacturing industry, developing sectors such as electrical appliances and clothing production. According to the latest yearly data by Statistics Poland, the value of sold production of industrial products increased by 23% y-o-y in 2021, with that of the gas sector, in particular, growing by 115%.

The tertiary sector represents 56.9% of GDP, employing about 59% of the active population. The sector has been booming in recent years, especially for financial services, logistics, IT and tourism; this one, in particular, has seen impressive growth: after declining due to the COVID-related restrictions, the sector recovered quickly and in the first half of 2022 Poland recorded 14.7 million overnight stays (of which 2.3 million regarding foreign tourists), up by 177.1% compared to the same period one year earlier. Concerning the banking sector, it is made up of 30 commercial banks (of which 8 are controlled by the State Treasury, accounting for 41.1% of the sector’s total assets), 511 cooperative banks and 37 branches of credit institutions (European Banking Federation).

Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 9.1 32.1 58.7
Value Added (in % of GDP) 2.2 27.9 56.9
Value Added (Annual % Change) -11.1 3.4 8.9

Source: World Bank, Latest data available.


Find more information about your business sector on our service Market Reports.

Indicator of Economic Freedom


The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

World Rank:
Regional Rank:

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation


Business environment ranking


The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.

World Rank:

Source: The Economist Intelligence Unit - Business Environment Rankings 2020-2024


Country Risk

See the country risk analysis provided by Coface.


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Political Outline

Current Political Leaders
President: Andrzej Duda (since 6th August, 2015)
Prime Minister: Mateusz Morawiecki (since 11th December, 2017)
Next Election Dates
Presidential: 2025
Senate: October 2023
Sejm: October 2023
Current Political Context
The ruling Eurosceptic Law and Justice Party (PiS) obtained the majority in the Sejm in the last elections but lost it in the Senate. Nevertheless, Morawiecki was confirmed as Prime Minister, and a new coalition agreement reached by PiS has marginally improved the stability of the ruling coalition.
The year 2022 was politically characterized by the Russian-Ukraine conflict. From the beginning of Russia’s invasion, Poland has supported Ukraine militarily, economically and socially, seeking the toughest possible sanctions on Russia and the isolation of the country. Accordingly, the government decided to raise the defence budget to 3% of GDP.
At the same time, tensions with the European Commission continued since billions of euros in funds from the EU Reconstruction Fund were blocked by the Commission, which accused the Polish authorities of restricting the independence of the judiciary. A new election is scheduled for the fall of 2023, with topics such as rising inflation and the war in Ukraine dominating the electoral campaign.
Main Political Parties
Poland is generally governed by a coalition government. The country's main parties/coalitions are:

- Law & Justice (PiS): centre-right, in the Government since November 2015, mildly euro-skeptic and based on a platform of law and order
- Civic Coalition (KO): centre-right, stronger electoral performance in northern and western regions
- Democratic Left Alliance (The Left) (SLD): centre-left, successor of the communist party, recast as a social democratic party
- Polish People' Party (PSL): Christian democratic, centrist, represents farming communities
- Confederation Liberty and Independence: far-right, populist
- Solidarity Poland (SP): right wing
- Agreement: Centre-Right, Conservative Liberalism
- German Minority Electoral Committee: represents the German minority in the lower house of the Polish parliament
- Modern: liberal
- Kukiz'15: right, anti-establishment
- Left Together (LR): left-wing, socialism, democratic
- National Movement (RN): Far-Right, Polish Nationalist
- KORWiN: right-wing
- Polish Initiative (IPL): progressivism, social democracy
- The Greens: green politics, progressivism
- Union Of European Democrats (UED): centre, social liberal

Other minor political parties:

- Congress Of New Right (KNP): Right-wing, libertarian
- Right Wing of The Republic ( PR) :Social-Conservatist
- Real Politics Union (UPR): Right Wing
- Labour United (UP): Centre-Left, social-democratic
- Your Movement (TR): liberal, typically described in media as libertarian or populist, represents minority groups in Polish society

Type of State
Poland (official name: Republic of Poland) is a republic based on parliamentary democracy.
Executive Power
The President is the head of State, elected by universal suffrage for a five year term. The Prime Minister is the head of the government. He is appointed by the President, an appointment which must be confirmed by the lower house of Parliament (as a general rule, he is the leader of the majority party or coalition), for a four-year term of office. The Prime Minister holds the executive power, which includes the enforcement of the law and the management of the country's current affairs. The Council of Ministers is proposed by the Prime Minister and approved by the lower house before being appointed by the President.
Legislative Power
The legislative power in Poland is bi-cameral. Parliament is composed of the Senate (upper house, which has 100 seats and whose members are elected by a majority vote on a provincial basis, for a four-year term of office) and of the Sejm (lower house, which has 460 seats and whose members are elected by a complex system of proportional representation, for a mandate of four years). The President has the right to veto legislation passed by Parliament, but the latter can supplant him by a majority of two thirds of the Sejm.

Indicator of Freedom of the Press


The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:

Indicator of Political Freedom


The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Political Freedom:
Civil Liberties:

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House


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COVID-19 Country Response

Travel restrictions
Regularly updated travel information for all countries with regards to Covid-19 related entry regulations, flight bans, test and vaccines requirements is available on TravelDoc Infopage.
To find information about the current travel regulations, including health requirements, it is also advised to consult Travel Regulations Map provided and updated on a daily basis by IATA.
Import & export restrictions
A general overview of trade restrictions which were adopted by different countries during the COVID-19 pandemic is available on the International Trade Centre's COVID-19 Temporary Trade Measures webpage.
Economic recovery plan
The summary of the EU’s economic response to the COVID-19 pandemic is available on the website of the European Council.
For the general overview of the key economic policy responses to the COVID-19 outbreak (fiscal, monetary and macroeconomic) in Poland, please consult the country's dedicated section in the IMF’s Policy Tracker platform.
Support plan for businesses
For an evaluation of impact of the Covid pandemic on SMEs and an inventory of country responses to foster SME resilience, refer to the OECD's SME Covid-19 Policy Responses document.
You can also consult the World Bank's Map of SME-Support Measures in Response to COVID-19.


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Latest Update: September 2023