Economic Sustainability
#25Key Findings
In the category of economic sustainability, Poland performs relatively poorly in international comparison (rank 25).
Circular economy remains in the early stages. The circularity rate has declined, while waste generation has increased. A legal framework is in place for managing critical infrastructure across various sectors. Renewable energy development has been slow. The country strongly relies on fossil fuels, and the government has been hesitant to downsize the coal industry.
Unemployment rates are low. Labor market support measures primarily center on intervention works and public works, which focus on unemployed manual workers. The minimum wage was recently increased. Social insurance includes pensions, disability and sickness benefits, and accident insurance.
A post-pandemic tax reform lowered income tax rates and increased allowances. Firms are now subject to a minimum tax rate. Emissions-intensive vehicles are not taxed. Debt levels are moderate, but expenses have been shifted to special funds to avoid deficit rules. R&D spending has increased.
Circular economy remains in the early stages. The circularity rate has declined, while waste generation has increased. A legal framework is in place for managing critical infrastructure across various sectors. Renewable energy development has been slow. The country strongly relies on fossil fuels, and the government has been hesitant to downsize the coal industry.
Unemployment rates are low. Labor market support measures primarily center on intervention works and public works, which focus on unemployed manual workers. The minimum wage was recently increased. Social insurance includes pensions, disability and sickness benefits, and accident insurance.
A post-pandemic tax reform lowered income tax rates and increased allowances. Firms are now subject to a minimum tax rate. Emissions-intensive vehicles are not taxed. Debt levels are moderate, but expenses have been shifted to special funds to avoid deficit rules. R&D spending has increased.
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How committed is the government to driving the transition toward a circular economy?
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9
9
The government is clearly committed to transitioning to a circular economy.
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7
6
7
6
The government is largely committed to transitioning to a circular economy.
5
4
3
4
3
The government is somewhat committed to transitioning to a circular economy.
2
1
1
The government is not at all committed to transitioning to a circular economy.
Poland’s approach to the circular economy remains in its early stages, primarily aligning with basic regulations set by the EU. However, data from 2015 – 2021 revealed a regression in Poland’s circularity rate by 1.8% and a notable 9.1% increase in waste generation (European Court of Auditors 2023). Eurostat indicates that Poland’s consumption footprint surged by 20% in 2021 compared to 2010, with the country having the second-largest footprint in the EU after Malta. This was well above the EU average, which saw a mere 4% increase. Furthermore, Poland’s material footprint exceeded the EU average, with 19.9 tons of raw material consumption per capita in 2022. Poland also fell below the EU average in terms of its circular material usage rate, at just 8.4% (Eurostat 2023).
The Circular Economy Roadmap of 2019 outlined initiatives targeting the design and production phases, emphasizing goals including innovation, industry-research collaboration, creation of a European market for secondary raw materials, and the promotion of high-quality sustainable production processes. Though the roadmap was spearheaded by the Ministry of Economic Development and Technology, its nonbinding nature and vague legal framework led to challenges in overseeing the program’s implementation. The roadmap emphasized that the concept’s effectiveness should be assessed based on the outcomes of these initiatives.
In July 2022, Poland adopted a new Productivity Strategy 2030 to guide its transition to a circular economy. The strategy introduced unique indicators like “resource productivity,” deviating from those used by the European Commission. Additionally, it acknowledged specific regional features by outlining programs and goals at the voivodship level. While Poland included measures to support the circular economy transition in its National Recovery and Resilience Plan, funding was suspended amid conflicts over the rule of law.
Citations:
European Court of Auditors. 2023. “Circular Economy. Special Report 17/2023. Slow Transition by Member States Despite EU Action.” https://www.eca.europa.eu/ECAPublications/SR-2023-17/SR-2023-17_EN.pdf
Eurostat. 2023. “Databrowser.” https://ec.europa.eu/eurostat/databrowser/view/CEI_gsr010/default/bar?lang=en+
Ministry of Economic Development and Technology. 2022. “Strategia Produktywności 2030.” https://www.gov.pl/web/rozwoj-technologia/strategia-produktywnosci-2031
The Circular Economy Roadmap of 2019 outlined initiatives targeting the design and production phases, emphasizing goals including innovation, industry-research collaboration, creation of a European market for secondary raw materials, and the promotion of high-quality sustainable production processes. Though the roadmap was spearheaded by the Ministry of Economic Development and Technology, its nonbinding nature and vague legal framework led to challenges in overseeing the program’s implementation. The roadmap emphasized that the concept’s effectiveness should be assessed based on the outcomes of these initiatives.
In July 2022, Poland adopted a new Productivity Strategy 2030 to guide its transition to a circular economy. The strategy introduced unique indicators like “resource productivity,” deviating from those used by the European Commission. Additionally, it acknowledged specific regional features by outlining programs and goals at the voivodship level. While Poland included measures to support the circular economy transition in its National Recovery and Resilience Plan, funding was suspended amid conflicts over the rule of law.
Citations:
European Court of Auditors. 2023. “Circular Economy. Special Report 17/2023. Slow Transition by Member States Despite EU Action.” https://www.eca.europa.eu/ECAPublications/SR-2023-17/SR-2023-17_EN.pdf
Eurostat. 2023. “Databrowser.” https://ec.europa.eu/eurostat/databrowser/view/CEI_gsr010/default/bar?lang=en+
Ministry of Economic Development and Technology. 2022. “Strategia Produktywności 2030.” https://www.gov.pl/web/rozwoj-technologia/strategia-produktywnosci-2031
Graph View
How committed is the government to updating and protecting critical infrastructure?
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The government is clearly committed to updating basic technical infrastructure.
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The government is largely committed to updating basic technical infrastructure.
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3
The government is somewhat committed to updating basic technical infrastructure.
2
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1
The government is not at all committed to updating basic technical infrastructure.
Poland has introduced a comprehensive legal framework for managing critical infrastructure. The Law on Crisis Management (2007) and the Law on Anti-Terrorism Activities (2016) are in force. Additionally, the Cybersecurity Strategy for the years 2019 – 2024 was approved by the government on October 22, 2019. The National Infrastructure Protection Plan (Narodowy Program Ochrony Infrastruktury Krytycznej) is updated at least every two years, with the most recent update in 2023.
The plan addresses areas such as energy, communication, telecommunications and information networks, financial systems, food and water supply, wealth protection, transportation, rescue systems, continuity of public administration activities, production systems, and chemical and radioactive substances. These areas fall under a number of different ministries’ jurisdictions, but the Government Security Center coordinates these efforts.
Based on information from ministers and voivodes, the director of the Center annually presents an assessment of the program’s effectiveness. The Center also serves as the national contact point for institutions of the European Union and the North Atlantic Treaty Organization. An additional supporting body is the Government Plenipotentiary for Strategic Energy Infrastructure, which oversees companies such as Polish Power Grids (Polskie Sieci Elektroenergetyczne), Polish Nuclear Power Plants (Polskie Elektrownie Jądrowe), Gas System (Gaz System) and PERN.
In recent years, the Polish government has undertaken or completed various initiatives connected with the transport system. It introduced the Safe Road Infrastructure program; the Świna Tunnel in Świnoujście opened on June 30, 2023; the Vistula Spit digging project canal opened on September 17, 2022; and a program intended to build 100 road bypasses was launched. The construction of the Central Communication Port and Via Carpatia is also underway.
On the other hand, Poland’s energy infrastructure does not fully meet the country’s needs. Electric power lines are old and inefficient and do not support the development and distribution of energy, such as decentralized energy production from renewable sources. This threatens the ability to meet growing demands in the future.
Starting in 2022, the war in Ukraine has been the most significant factor analyzed in terms of critical infrastructure safety. Since February 22, 2022, an elevated and sustained state of emergency has been in effect – the highest in Poland’s modern history.
The “strategic” airports, which have gained in importance due to their use in transporting military aid to Ukraine (such as Rzeszów), are the only type of critical infrastructure in Poland subject to systemic control (national and EU) and supervision by state institutions (Biznes Alert 2023). The government has taken steps to enhance security around the LNG terminal in Świnoujście and the Baltic Pipe gas pipeline, which was launched on September 27, 2022.
Poland has also been repelling cyberattacks. Poland was recently ranked in sixth place in the Cyber Defense Index 22/23 (2023), which assesses progress in digitalization and cybersecurity among the world’s 20 largest economies. It was acknowledged for implementing a memorandum of understanding, signed with Ukraine in August 2022, to strengthen regional cybersecurity collaboration. However, in terms of AI capacity, Poland’s sectoral rank was much lower, at 14th place.
Citations:
Biznes Alert. 2023. “Poland can be a European leader in protecting critical infrastructure if it doesn’t shoot itself in the foot.” https://biznesalert.com/poland-can-be-a-european-leader-in-protecting-critical-infrastructure-if-it-doesnt-shoot-itself-in-the-foot-interview
MIT Technology Review. 2024. “Cyber Defense Index 22/23.” https://www.technologyreview.com/2022/11/15/1063189/the-cyber-defense-index-2022-23
https://iee.kpi.ua/en/protecting-critical-infrastructure-in-response-to-terrorist-attacks-nato-sps-workshop/
The plan addresses areas such as energy, communication, telecommunications and information networks, financial systems, food and water supply, wealth protection, transportation, rescue systems, continuity of public administration activities, production systems, and chemical and radioactive substances. These areas fall under a number of different ministries’ jurisdictions, but the Government Security Center coordinates these efforts.
Based on information from ministers and voivodes, the director of the Center annually presents an assessment of the program’s effectiveness. The Center also serves as the national contact point for institutions of the European Union and the North Atlantic Treaty Organization. An additional supporting body is the Government Plenipotentiary for Strategic Energy Infrastructure, which oversees companies such as Polish Power Grids (Polskie Sieci Elektroenergetyczne), Polish Nuclear Power Plants (Polskie Elektrownie Jądrowe), Gas System (Gaz System) and PERN.
In recent years, the Polish government has undertaken or completed various initiatives connected with the transport system. It introduced the Safe Road Infrastructure program; the Świna Tunnel in Świnoujście opened on June 30, 2023; the Vistula Spit digging project canal opened on September 17, 2022; and a program intended to build 100 road bypasses was launched. The construction of the Central Communication Port and Via Carpatia is also underway.
On the other hand, Poland’s energy infrastructure does not fully meet the country’s needs. Electric power lines are old and inefficient and do not support the development and distribution of energy, such as decentralized energy production from renewable sources. This threatens the ability to meet growing demands in the future.
Starting in 2022, the war in Ukraine has been the most significant factor analyzed in terms of critical infrastructure safety. Since February 22, 2022, an elevated and sustained state of emergency has been in effect – the highest in Poland’s modern history.
The “strategic” airports, which have gained in importance due to their use in transporting military aid to Ukraine (such as Rzeszów), are the only type of critical infrastructure in Poland subject to systemic control (national and EU) and supervision by state institutions (Biznes Alert 2023). The government has taken steps to enhance security around the LNG terminal in Świnoujście and the Baltic Pipe gas pipeline, which was launched on September 27, 2022.
Poland has also been repelling cyberattacks. Poland was recently ranked in sixth place in the Cyber Defense Index 22/23 (2023), which assesses progress in digitalization and cybersecurity among the world’s 20 largest economies. It was acknowledged for implementing a memorandum of understanding, signed with Ukraine in August 2022, to strengthen regional cybersecurity collaboration. However, in terms of AI capacity, Poland’s sectoral rank was much lower, at 14th place.
Citations:
Biznes Alert. 2023. “Poland can be a European leader in protecting critical infrastructure if it doesn’t shoot itself in the foot.” https://biznesalert.com/poland-can-be-a-european-leader-in-protecting-critical-infrastructure-if-it-doesnt-shoot-itself-in-the-foot-interview
MIT Technology Review. 2024. “Cyber Defense Index 22/23.” https://www.technologyreview.com/2022/11/15/1063189/the-cyber-defense-index-2022-23
https://iee.kpi.ua/en/protecting-critical-infrastructure-in-response-to-terrorist-attacks-nato-sps-workshop/
Graph View
How committed is the government to fully decarbonizing the energy system by 2050?
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The government is clearly committed to transitioning to a decarbonized energy system.
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7
6
The government is largely committed to transitioning to a decarbonized energy system.
5
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3
4
3
The government is somewhat committed to transitioning to a decarbonized energy system.
2
1
1
The government is not at all committed to transitioning to a decarbonized energy system.
Poland, known for its carbon-intensive economy, has been gradually working toward decarbonization. A total of 72% of energy produced and 82% of electricity in Poland relies on solid fuels, giving it the second-highest rate of fossil-fuel-based energy production in the EU. Despite being the second-largest coal producer in the EU, Poland reduced net greenhouse gas emissions by 20.1% in 2021 compared to 1990 levels. While emissions decreased across various sectors from 1990 to 2021, the transport sector saw an increase of 229%, reflecting a trend observed throughout the EU.
In terms of emissions per capita and the greenhouse gas intensity of GDP, Poland exceeded the EU averages in 2021 (Enerdata 2023). Renewable energy accounted for 18.84% of energy production, compared to the EU average of 22.47% in 2022. This figure is similar to that of Czechia (17.98%), Slovakia (17.69%) and Hungary (14.05%) (European Environment Agency 2024). The steady increase in the use of renewable energy sources was due to EU-sponsored programs for individual households and the cogeneration of electricity using coal and biofuels.
In February 2021, the government embraced its updated energy policy, PEP2040, extending the vision until 2040. The policy aims for 23% of energy to come from renewables by 2030, with substantial reductions in coal usage to at least 56% by 2030, a boost in wind energy and the introduction of Poland’s first nuclear power reactor in 2033. Poland is also adapting to the Green Deal framework of the European Union, including the FITfor55 program, and is expected to be the largest beneficiary of the EU’s budget for low-carbon transformation. Between 2025 and 2032, Poland is projected to receive €12.7 billion from the Social Climate Fund, constituting 17.6% of the total budget (International Trade Administration, 2023).
Despite the urgent need for green transformation, the PiS government hesitated to downsize its national coal industry, planning to close the remaining mines by 2049 despite their economic inefficiency. This decision was influenced by notions of sovereignty and the political significance of the Upper Silesia mining region. In 2022, Poland spent approximately €41 billion on fossil fuel imports due to increased demand and favorable prices, although it refrained from substantial subsidies (0.35% of GDP compared to 0.76% in the EU). Ranked 20th in Europe for carbon taxes, Poland shifted from being an energy exporter in 2021 to an importer, with imports coming mainly from Germany, due to that country’s lower renewable energy prices. However, there were no significant efforts to modernize the country’s existing infrastructure.
Despite recognizing the importance of natural gas for a secure transition from coal, Poland ceased its gas imports from Russia after the Ukraine war. Instead, the country opted to focus on LNG imports and initiated the Baltic Pipe Line in September 2022 (Polish Economic Institute 2023). Plans for expanding energy capacity included a preliminary decision in July 2023 to build a nuclear power plant, although a potential second plant faced challenges under EU competition procedures.
Another key pillar in Poland’s decarbonization plan has involved promoting electromobility. The Sustainable Development of Transport Strategy aimed to have 600,000 electric vehicles on the country’s roads by 2025, but as of October 2023, only a bit more than 90,000 were registered. Subsidies introduced in 2021 accelerated the trend, but fell short of expectations.
Poland’s energy policies under the conservative government were heavily politicized, often blaming the EU and “Putinflation” for high energy prices. The focus on protecting Polish “sovereignty” led to opposition to EU energy and climate policies rather than the creation of alliances. A significant conflict area involved the EU’s emissions trading system (ETS), with Poland being required to purchase carbon allowances in 2022. The Sovereign Poland party, a coalition partner in the PiS government, proposed suspending Poland’s ETS participation in November 2022. In May 2023, they announced plans to push for unanimous EU decision-making in this area.
The liberal government that gained power in the October 2023 parliamentary elections declared that it would focus strongly on a green transformation, especially in the areas of renewable energy and a just transition. However, the climate neutrality goal was not mentioned in the coalition agreement.
Citations:
Enerdata. 2023. “Poland Energy Information.” https://www.enerdata.net/estore/energy-market/poland
European Environment Agency. 2024. “Climate.” https://www.eea.europa.eu/en/topics/at-a-glance/climate
International Trade Administration. 2023. “Poland – Country Commercial Guide.” https://www.trade.gov/country-commercial-guides/poland-energy-sector
Tax Foundation. 2022. “Carbon Taxes in Europe.” https://taxfoundation.org/data/all/eu/carbon-taxes-in-europe-2022/
https://www.mckinsey.com/pl/~/media/mckinsey/locations/europe%20and%20middle%20east/polska/raporty/carbon%20neutral%20poland%202050/carbon%20neutral%20poland_mckinsey%20report.pdf
In terms of emissions per capita and the greenhouse gas intensity of GDP, Poland exceeded the EU averages in 2021 (Enerdata 2023). Renewable energy accounted for 18.84% of energy production, compared to the EU average of 22.47% in 2022. This figure is similar to that of Czechia (17.98%), Slovakia (17.69%) and Hungary (14.05%) (European Environment Agency 2024). The steady increase in the use of renewable energy sources was due to EU-sponsored programs for individual households and the cogeneration of electricity using coal and biofuels.
In February 2021, the government embraced its updated energy policy, PEP2040, extending the vision until 2040. The policy aims for 23% of energy to come from renewables by 2030, with substantial reductions in coal usage to at least 56% by 2030, a boost in wind energy and the introduction of Poland’s first nuclear power reactor in 2033. Poland is also adapting to the Green Deal framework of the European Union, including the FITfor55 program, and is expected to be the largest beneficiary of the EU’s budget for low-carbon transformation. Between 2025 and 2032, Poland is projected to receive €12.7 billion from the Social Climate Fund, constituting 17.6% of the total budget (International Trade Administration, 2023).
Despite the urgent need for green transformation, the PiS government hesitated to downsize its national coal industry, planning to close the remaining mines by 2049 despite their economic inefficiency. This decision was influenced by notions of sovereignty and the political significance of the Upper Silesia mining region. In 2022, Poland spent approximately €41 billion on fossil fuel imports due to increased demand and favorable prices, although it refrained from substantial subsidies (0.35% of GDP compared to 0.76% in the EU). Ranked 20th in Europe for carbon taxes, Poland shifted from being an energy exporter in 2021 to an importer, with imports coming mainly from Germany, due to that country’s lower renewable energy prices. However, there were no significant efforts to modernize the country’s existing infrastructure.
Despite recognizing the importance of natural gas for a secure transition from coal, Poland ceased its gas imports from Russia after the Ukraine war. Instead, the country opted to focus on LNG imports and initiated the Baltic Pipe Line in September 2022 (Polish Economic Institute 2023). Plans for expanding energy capacity included a preliminary decision in July 2023 to build a nuclear power plant, although a potential second plant faced challenges under EU competition procedures.
Another key pillar in Poland’s decarbonization plan has involved promoting electromobility. The Sustainable Development of Transport Strategy aimed to have 600,000 electric vehicles on the country’s roads by 2025, but as of October 2023, only a bit more than 90,000 were registered. Subsidies introduced in 2021 accelerated the trend, but fell short of expectations.
Poland’s energy policies under the conservative government were heavily politicized, often blaming the EU and “Putinflation” for high energy prices. The focus on protecting Polish “sovereignty” led to opposition to EU energy and climate policies rather than the creation of alliances. A significant conflict area involved the EU’s emissions trading system (ETS), with Poland being required to purchase carbon allowances in 2022. The Sovereign Poland party, a coalition partner in the PiS government, proposed suspending Poland’s ETS participation in November 2022. In May 2023, they announced plans to push for unanimous EU decision-making in this area.
The liberal government that gained power in the October 2023 parliamentary elections declared that it would focus strongly on a green transformation, especially in the areas of renewable energy and a just transition. However, the climate neutrality goal was not mentioned in the coalition agreement.
Citations:
Enerdata. 2023. “Poland Energy Information.” https://www.enerdata.net/estore/energy-market/poland
European Environment Agency. 2024. “Climate.” https://www.eea.europa.eu/en/topics/at-a-glance/climate
International Trade Administration. 2023. “Poland – Country Commercial Guide.” https://www.trade.gov/country-commercial-guides/poland-energy-sector
Tax Foundation. 2022. “Carbon Taxes in Europe.” https://taxfoundation.org/data/all/eu/carbon-taxes-in-europe-2022/
https://www.mckinsey.com/pl/~/media/mckinsey/locations/europe%20and%20middle%20east/polska/raporty/carbon%20neutral%20poland%202050/carbon%20neutral%20poland_mckinsey%20report.pdf
Graph View
To what extent do existing labor market institutions support or hinder the transition to an adaptive labor market?
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Labor market institutions are fully aligned with the goal of an adaptable labor market.
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7
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Labor market institutions are largely aligned with the goal of an adaptable labor market.
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3
Labor market institutions are only somewhat aligned with the goal of an adaptable labor market.
2
1
1
Labor market institutions are not at all aligned with the goal of an adaptable labor market.
The Polish labor market shifted to being employee-centered despite the 2022 economic crisis, achieving a record-low unemployment rate of around 5% (Polish statistics) or approximately 3% (Eurostat). This figure is the third-lowest in the EU. Since 2018, Poland has exceeded the national employment rate target for the 20 – 64 age group, set in the Europe 2020 strategy at 71%. However, the employment rate for senior citizens in Poland (8.9%) remains lower than the EU average of 10% in 2022. The overall situation in the labor market has resulted in a shortage of skilled workers across sectors, and is indicative of positive economic development.
Since 2004, Poland’s law has promoted various aspects of employment as outlined in the annual National Action Plans. For 2023, the plan included vocational activation programs including internships, training, intervention work, public works, equipment reimbursement and one-time funding for startups.
The primary support mechanisms include intervention works and public works, which focus on unemployed manual workers. However, reports from regional employment centers indicate that fewer than 50 people participate in training programs each month. A significant challenge is the minimal involvement of occupationally inactive individuals. Additionally, the connection between health insurance and unemployment status diminishes interest in activation measures.
Employers must provide employee training, and training funds are employer-financed. Temporary employment agencies collaborate with large enterprises to meet short-term worker demand. Institutions involved in worker adaptation programs include public employment services, the Volunteer Labor Corps, employment agencies, counseling services, vocational guidance services and social dialogue institutions.
The war in Ukraine has caused an influx of over 2 million foreigners into the Polish labor market annually. Despite this, there is a lack of activities supporting their integration. The number of Ukrainian immigrants in Poland is decreasing, with less than 20% choosing to stay and work (under 700,000 in total) (Polska Agencja Rozwoju Przedsiębiorczości 2023).
Citations:
Polska Agencja Rozwoju Przedsiębiorczości. 2023. “Rynek pracy, edukacja, kompetencje. Aktualne trendy i wyniki badań (wrzesień 2023).” https://www.parp.gov.pl/component/publications/publication/rynek-pracy-edukacja-kompetencje-aktualne-trendy-i-wyniki-badan-wrzesien-2023
Since 2004, Poland’s law has promoted various aspects of employment as outlined in the annual National Action Plans. For 2023, the plan included vocational activation programs including internships, training, intervention work, public works, equipment reimbursement and one-time funding for startups.
The primary support mechanisms include intervention works and public works, which focus on unemployed manual workers. However, reports from regional employment centers indicate that fewer than 50 people participate in training programs each month. A significant challenge is the minimal involvement of occupationally inactive individuals. Additionally, the connection between health insurance and unemployment status diminishes interest in activation measures.
Employers must provide employee training, and training funds are employer-financed. Temporary employment agencies collaborate with large enterprises to meet short-term worker demand. Institutions involved in worker adaptation programs include public employment services, the Volunteer Labor Corps, employment agencies, counseling services, vocational guidance services and social dialogue institutions.
The war in Ukraine has caused an influx of over 2 million foreigners into the Polish labor market annually. Despite this, there is a lack of activities supporting their integration. The number of Ukrainian immigrants in Poland is decreasing, with less than 20% choosing to stay and work (under 700,000 in total) (Polska Agencja Rozwoju Przedsiębiorczości 2023).
Citations:
Polska Agencja Rozwoju Przedsiębiorczości. 2023. “Rynek pracy, edukacja, kompetencje. Aktualne trendy i wyniki badań (wrzesień 2023).” https://www.parp.gov.pl/component/publications/publication/rynek-pracy-edukacja-kompetencje-aktualne-trendy-i-wyniki-badan-wrzesien-2023
To what extent do existing labor market institutions support or hinder the transition to an inclusive labor market?
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9
9
Labor market institutions are fully aligned with the goal of an inclusive labor market.
8
7
6
7
6
Labor market institutions are largely aligned with the goal of an inclusive labor market.
5
4
3
4
3
Labor market institutions are only somewhat aligned with the goal of an inclusive labor market.
2
1
1
Labor market institutions are not at all aligned with the goal of an inclusive labor market.
The cost of living in Poland is increasing, forcing workers to seek full-time employment in order to earn the minimum wage. In 2020, only 12% of employed individuals worked part-time. However, recent measures such as a minimum wage increase and the introduction of tax relief have helped boost workers’ incomes. Starting January 1, 2023, the minimum wage was PLN 3,490.00 gross, rising to PLN 3,600.00 as of July 1, 2023. As of January 1, 2024, the minimum wage reached PLN 4,240.00 gross. Additionally, eligibility for social insurance provides workers with the opportunity to benefit from social security benefits.
The government has also introduced various incentives for young people. Through the so-called Polish Deal, the state implemented tax relief for young individuals, exempting those under 26 from income tax on earnings from work or commissions. The Young People on Start program was also directed toward this group. Given the demographic shift, with a rising share of the population reaching retirement age, the state is seeking to encourage young individuals to work. This is a crucial goal as the number of individuals contributing to social security decreases. While young people could benefit from subsidies for training or studies, this often involves an employment contract with a specific company, which can prove burdensome for those unwilling to commit to additional agreements.
Currently, only one in 10 Poles (10.9%) aged 15 – 29 is neither working nor studying. This is the best result in the country’s recent history and surpasses the EU average. In 2021, at the onset of the pandemic, this percentage increased to 13.4%, but 2022 brought a significant improvement (Eurostat 2023). The shift was influenced by changes caused by the pandemic, particularly remote learning and work opportunities. Young people were thus able to benefit from education and training without incurring additional costs such as accommodation or commuting.
The work-life balance directive in Poland was introduced through an amendment to the Labor Code in July 2023. The directive includes extended parental leave, with a focus on the child’s father, who is now entitled to nine weeks. Additional caregiving leave allowances and regulated remote work opportunities are also intended to help maintain a balance between work and private life.
Citations:
Eurostat. 2023. “Statistics on Young People Neither in Employment Nor in Education or Training.” https://ec.europa.eu/eurostat/statistics-explained/index.php?title=File:Vis2-young-people-neither-in-employment-nor-in-education-or-training_260523.png
The government has also introduced various incentives for young people. Through the so-called Polish Deal, the state implemented tax relief for young individuals, exempting those under 26 from income tax on earnings from work or commissions. The Young People on Start program was also directed toward this group. Given the demographic shift, with a rising share of the population reaching retirement age, the state is seeking to encourage young individuals to work. This is a crucial goal as the number of individuals contributing to social security decreases. While young people could benefit from subsidies for training or studies, this often involves an employment contract with a specific company, which can prove burdensome for those unwilling to commit to additional agreements.
Currently, only one in 10 Poles (10.9%) aged 15 – 29 is neither working nor studying. This is the best result in the country’s recent history and surpasses the EU average. In 2021, at the onset of the pandemic, this percentage increased to 13.4%, but 2022 brought a significant improvement (Eurostat 2023). The shift was influenced by changes caused by the pandemic, particularly remote learning and work opportunities. Young people were thus able to benefit from education and training without incurring additional costs such as accommodation or commuting.
The work-life balance directive in Poland was introduced through an amendment to the Labor Code in July 2023. The directive includes extended parental leave, with a focus on the child’s father, who is now entitled to nine weeks. Additional caregiving leave allowances and regulated remote work opportunities are also intended to help maintain a balance between work and private life.
Citations:
Eurostat. 2023. “Statistics on Young People Neither in Employment Nor in Education or Training.” https://ec.europa.eu/eurostat/statistics-explained/index.php?title=File:Vis2-young-people-neither-in-employment-nor-in-education-or-training_260523.png
To what extent do existing labor market institutions support or hinder the mitigation of labor market risks?
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9
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Labor market institutions are fully aligned with the goal of protecting individuals against labor market risks.
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7
6
7
6
Labor market institutions are largely aligned with the goal of protecting individuals against labor market risks.
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3
4
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Labor market institutions are only somewhat aligned with the goal of protecting individuals against labor market risks.
2
1
1
Labor market institutions are not at all aligned with the goal of protecting individuals against labor market risks.
Social insurance in Poland includes pensions, disability and sickness benefits, and accident insurance. These cover employees engaged in employment contracts. Individuals conducting business activities independently or employed under a civil law contract (commission agreements) can opt out of sickness insurance and join it voluntarily. Workers employed under a specific task contract are excluded from pension insurance. Their only obligation is to register such a contract with the Social Insurance Institution (Zakład Ubezpieczeń Społecznych, ZUS). In 2023, the topic of social security contributions for specific task contracts appeared in the National Reform Plan, and were the subject of social consultations. Changes to this regulation were unlikely to appear before the first quarter of 2024.
Trade union membership is open to employees, individuals employed under civil law contracts, and the self-employed. Union members always have greater protection, particularly in matters of job termination and individual labor law. Another representative body for employees is the Workers’ Council, which serves as an in-house mediator between employers and employees. Unlike trade unions, the Council represents all employees.
In general, social rights and social insurance apply to specific individuals. After meeting risk criteria, recipients receive specific benefits. Family members typically also receive health insurance. In the realm of pension insurance, there is the institution of a family pension, a benefit triggered by the death of a family member. This amounts to 85% of the benefit that the deceased individual would have received. Pension insurance benefits can also be inherited.
Citations:
https://notesfrompoland.com/2022/06/01/ukrainian-refugees-fill-gaps-in-polish-labour-market-but-risk-getting-stuck-in-low-skilled-jobs/
Trade union membership is open to employees, individuals employed under civil law contracts, and the self-employed. Union members always have greater protection, particularly in matters of job termination and individual labor law. Another representative body for employees is the Workers’ Council, which serves as an in-house mediator between employers and employees. Unlike trade unions, the Council represents all employees.
In general, social rights and social insurance apply to specific individuals. After meeting risk criteria, recipients receive specific benefits. Family members typically also receive health insurance. In the realm of pension insurance, there is the institution of a family pension, a benefit triggered by the death of a family member. This amounts to 85% of the benefit that the deceased individual would have received. Pension insurance benefits can also be inherited.
Citations:
https://notesfrompoland.com/2022/06/01/ukrainian-refugees-fill-gaps-in-polish-labour-market-but-risk-getting-stuck-in-low-skilled-jobs/
Graph View
To what extent do existing tax institutions and procedures support or hinder adequate tax revenue flows?
10
9
9
The tax system is fully aligned with the goals of ensuring adequate tax revenues.
8
7
6
7
6
The tax system is largely aligned with the goals of ensuring adequate tax revenues.
5
4
3
4
3
The tax system is only somewhat aligned with the goals of ensuring adequate tax revenues.
2
1
1
The tax system is not at all aligned with the goals of ensuring adequate tax revenues.
The “Polish Deal” (Polski Ład), introduced in early 2022, was a tax scheme aimed at boosting the post-pandemic economy. It involved an extensive tax system overhaul, increased family benefits, higher healthcare expenditures and additional public investments. The initiative faced criticism for its added spending commitments, elevated tax load on entrepreneurs and the middle class, and unclear investment strategies. Widespread confusion led to numerous amendments in the same year.
The scheme introduced a reduction in the tax scale from 17% to 12%. The tax-free allowance was raised to PLN 30,000, and the tax threshold was increased to PLN 120,000. Individuals earning below PLN 13,000 saw their tax burden reduced. Unfortunately, the inflationary situation did not favor investments, which reached only 16.7% of GDP in 2022, the lowest such figure since 1994. Many businesses were concerned about their financial liquidity and elected to delay investments until economic conditions improved. This improvement was expected to occur in 2024, with a predicted growth in investment spending of more than 2%.
In Poland, tax administration institutions include the Ministry of Finance, which oversees financial policies, and the National Revenue Administration (Krajowa Administracja Skarbowa, KAS), which is responsible for tax collection. Additionally, the Fiscal Administration Chamber (Izba Administracji Skarbowej, IAS) handles tax-related legal matters, and local tax offices (Urząd Skarbowy) manage tax affairs at the regional level. Their effectiveness has increased since 2015, as the VAT tax gap has been narrowing. This gap was approximately 4.9% in 2022, making it one of the smallest such figures in Europe. However, collecting tax obligations owed to the state continues to present challenges. Tax authorities claim to detect irregularities, yet only around 10% of the allegedly outstanding arrears are subject to enforcement.
Citations:
https://www.dentons.com/en/services-and-solutions/global-tax-guide-to-doing-business-in/poland
The scheme introduced a reduction in the tax scale from 17% to 12%. The tax-free allowance was raised to PLN 30,000, and the tax threshold was increased to PLN 120,000. Individuals earning below PLN 13,000 saw their tax burden reduced. Unfortunately, the inflationary situation did not favor investments, which reached only 16.7% of GDP in 2022, the lowest such figure since 1994. Many businesses were concerned about their financial liquidity and elected to delay investments until economic conditions improved. This improvement was expected to occur in 2024, with a predicted growth in investment spending of more than 2%.
In Poland, tax administration institutions include the Ministry of Finance, which oversees financial policies, and the National Revenue Administration (Krajowa Administracja Skarbowa, KAS), which is responsible for tax collection. Additionally, the Fiscal Administration Chamber (Izba Administracji Skarbowej, IAS) handles tax-related legal matters, and local tax offices (Urząd Skarbowy) manage tax affairs at the regional level. Their effectiveness has increased since 2015, as the VAT tax gap has been narrowing. This gap was approximately 4.9% in 2022, making it one of the smallest such figures in Europe. However, collecting tax obligations owed to the state continues to present challenges. Tax authorities claim to detect irregularities, yet only around 10% of the allegedly outstanding arrears are subject to enforcement.
Citations:
https://www.dentons.com/en/services-and-solutions/global-tax-guide-to-doing-business-in/poland
To what extent do existing tax institutions and procedures consider equity aspects?
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9
9
The tax system is fully aligned with the goal of ensuring equity.
8
7
6
7
6
The tax system is largely aligned with the goal of ensuring equity.
5
4
3
4
3
The tax system is only somewhat aligned with the goal of ensuring equity.
2
1
1
The tax system is not at all aligned with the goal of ensuring equity.
Poland’s income tax system is progressive, meaning tax rates depend on the amount of income earned. The tax obligation arises at the moment an event defined in the law occurs. It is irrelevant whether any actual payment has been made, which poses a significant challenge for businesses operating on the basis of delayed payments, as these companies must pay taxes even if they have not yet received the underlying revenue.
Poland introduced a minimum tax as of January 1, 2024. It will be paid by companies that have incurred a tax loss or have not exceeded a 2% profitability threshold. Additionally, the largest state monopolies contribute the most substantial fees to the state treasury, largely as a result of amounts allocated to purchase CO2 emission rights.
Poland introduced a minimum tax as of January 1, 2024. It will be paid by companies that have incurred a tax loss or have not exceeded a 2% profitability threshold. Additionally, the largest state monopolies contribute the most substantial fees to the state treasury, largely as a result of amounts allocated to purchase CO2 emission rights.
To what extent do existing tax institutions and procedures minimize compliance and collection costs?
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9
9
The tax system is fully aligned with the goal of minimizing compliance and collection costs.
8
7
6
7
6
The tax system is largely aligned with the goal of minimizing compliance and collection costs.
5
4
3
4
3
The tax system is only somewhat aligned with the goal of minimizing compliance and collection costs.
2
1
1
The tax system is not at all aligned with the goal of minimizing compliance and collection costs.
The online platform provided by the Ministry of Finance, known as the e-Tax Office, facilitates the digital management of various tax-related issues. This platform includes services such as Your e-PIT, access to penalty mandates, provision of a tax micro account number and the e-Microenterprise service, which is designed for generating and submitting standard audit file for tax reports, among other features.
Levels of public trust in the tax offices remains relatively stable: 30% of survey respondents indicate that they are satisfied, 20% are dissatisfied and 50% have no opinion on the issue. The most significant reservations come from entrepreneurs and residents of large cities, primarily due to excessively long tax proceedings. A major issue is the VAT refund process for businesses, with key criticisms directed at officials’ arbitrariness and lack of substantive knowledge, which potentially cause financial liquidity challenges.
Levels of public trust in the tax offices remains relatively stable: 30% of survey respondents indicate that they are satisfied, 20% are dissatisfied and 50% have no opinion on the issue. The most significant reservations come from entrepreneurs and residents of large cities, primarily due to excessively long tax proceedings. A major issue is the VAT refund process for businesses, with key criticisms directed at officials’ arbitrariness and lack of substantive knowledge, which potentially cause financial liquidity challenges.
To what extent do existing tax institutions and procedures internalize negative and positive externalities?
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9
9
The tax system is fully aligned with the goal of internalizing externalities.
8
7
6
7
6
The tax system is largely aligned with the goal of internalizing externalities.
5
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3
4
3
The tax system is only somewhat aligned with the goal of internalizing externalities.
2
1
1
The tax system is not at all aligned with the goal of internalizing externalities.
In line with EU recommendations, environmental pollution-related taxes in Poland primarily target gases, particulates and CO2 emission rights. However, Poland is one of the few EU members that has not implemented a tax for owners of the most emissions-intensive vehicles. The government is introducing taxes to encourage healthy eating, such as a sugar tax, and is limiting access to unhealthy or dangerous products.
In 2016, Poland introduced the Research and Development Tax Relief (R&D relief) policy. Since 2022, companies have been able to deduct up to 200% of costs identified as innovation-related in their records. The government later expanded these incentives to include additional reliefs, such as the IP Box program, relief for innovative employees, relief for prototypes or the use of robotics, and expansion, which became eligible for tax deductions for the first time in 2023. Taxpayers have the right to an additional deduction of 50% of costs incurred for robotization from the tax base for the period 2022 – 2026.
In 2016, Poland introduced the Research and Development Tax Relief (R&D relief) policy. Since 2022, companies have been able to deduct up to 200% of costs identified as innovation-related in their records. The government later expanded these incentives to include additional reliefs, such as the IP Box program, relief for innovative employees, relief for prototypes or the use of robotics, and expansion, which became eligible for tax deductions for the first time in 2023. Taxpayers have the right to an additional deduction of 50% of costs incurred for robotization from the tax base for the period 2022 – 2026.
Graph View
To what extent do existing budgetary institutions and procedures support or hinder sustainable budgeting?
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9
9
Budgetary institutions and policies are fully aligned with the goals of sustainable budgeting.
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7
6
7
6
Budgetary institutions and policies are largely aligned with the goals of sustainable budgeting.
5
4
3
4
3
Budgetary institutions and policies are only somewhat aligned with the goals of sustainable budgeting.
2
1
1
Budgetary institutions and policies are not at all aligned with the goals of sustainable budgeting.
In Poland, the national budget adheres to key regulations such as the stabilizing expenditure rule (introduced in 2014), constitutional debt limits and the requirement for local governments to balance current expenditures. Although the budgetary process lacks a formal legal definition, it is governed by the constitution, the Public Finance Act and parliamentary rules. Budget assumptions set by the Ministry of Finance must align with the state’s Multiannual Financial Plan.
While the government drafts the budget, the parliament – especially the Sejm – can modify it. The budget bill’s review process spans four months, with potential sanctions for delays. Budget execution is closely monitored, with safeguards in place for financial management.
Fiscal policy has been used to support public investments in green initiatives, digital transformation and energy security, utilizing funds from the EU’s RePowerEU program. However, due to noncompliance with requirements, the first tranche of Recovery and Resilience Facility funding was transferred to the new government only at the end of 2023.
In 2022, Poland’s government debt-to-GDP ratio was 49.30%, well below the constitutional limit of 60%. When debt reaches 55% of GDP, the government is required to adopt a deficit-free budget. To accomplish this, authorities have shifted expenses to special funds like the “Solidarity Fund,” and have then borrowed from these funds to pay benefits. High levels of social spending, however, have resulted in very low investments in research and development, slowing innovation.
The principle of balancing revenues and expenditures has not been strictly followed, and the “golden rule,” which suggests using budget surpluses from economic booms to cover deficits during recessions, has not been effectively applied. The COVID-19 pandemic and the war in Ukraine further impacted public investments. The 2023 budget sought to address these challenges but faced constraints due to blocked National Reconstruction Plan funds and delayed investments. Priorities for the 2023 budget included defense, the so-called energy shield (a fixed electricity price for households beginning in 2022) and social programs (such as the 500+ child benefit and 13th and 14th pension months).
The budget forecasts were revised in July 2023, adjusting key figures: GDP growth was downgraded from 1.7% to 0.9%, and the expected inflation rate increased from 9.8% to 12%. The 2023 budget, developed in 2022, was based on overly optimistic assumptions about inflation, affecting economic outcomes. The October 15, 2023, elections also influenced the budget revision, leading to an increased state deficit and additional funds allocated to off-budget items, particularly for the armed forces (TVN24 2023).
Citations:
TVN24. 2023. “Poland to Report a Record Budget Deficit in 2023.” TVN24 Biznes, October 27. https://tvn24.pl/tvn24-news-in-english/poland-to-report-a-record-budget-deficit-in-2023-7412628
Serowaniec, Maciej. 2023. “The Debudgetisation of Public Finances in Poland After Covid‐19 and the War in Ukraine.” Politics and Governance 11 (4): 62–72.
https://doi.org/10.17645/pag.v11i4.7242
While the government drafts the budget, the parliament – especially the Sejm – can modify it. The budget bill’s review process spans four months, with potential sanctions for delays. Budget execution is closely monitored, with safeguards in place for financial management.
Fiscal policy has been used to support public investments in green initiatives, digital transformation and energy security, utilizing funds from the EU’s RePowerEU program. However, due to noncompliance with requirements, the first tranche of Recovery and Resilience Facility funding was transferred to the new government only at the end of 2023.
In 2022, Poland’s government debt-to-GDP ratio was 49.30%, well below the constitutional limit of 60%. When debt reaches 55% of GDP, the government is required to adopt a deficit-free budget. To accomplish this, authorities have shifted expenses to special funds like the “Solidarity Fund,” and have then borrowed from these funds to pay benefits. High levels of social spending, however, have resulted in very low investments in research and development, slowing innovation.
The principle of balancing revenues and expenditures has not been strictly followed, and the “golden rule,” which suggests using budget surpluses from economic booms to cover deficits during recessions, has not been effectively applied. The COVID-19 pandemic and the war in Ukraine further impacted public investments. The 2023 budget sought to address these challenges but faced constraints due to blocked National Reconstruction Plan funds and delayed investments. Priorities for the 2023 budget included defense, the so-called energy shield (a fixed electricity price for households beginning in 2022) and social programs (such as the 500+ child benefit and 13th and 14th pension months).
The budget forecasts were revised in July 2023, adjusting key figures: GDP growth was downgraded from 1.7% to 0.9%, and the expected inflation rate increased from 9.8% to 12%. The 2023 budget, developed in 2022, was based on overly optimistic assumptions about inflation, affecting economic outcomes. The October 15, 2023, elections also influenced the budget revision, leading to an increased state deficit and additional funds allocated to off-budget items, particularly for the armed forces (TVN24 2023).
Citations:
TVN24. 2023. “Poland to Report a Record Budget Deficit in 2023.” TVN24 Biznes, October 27. https://tvn24.pl/tvn24-news-in-english/poland-to-report-a-record-budget-deficit-in-2023-7412628
Serowaniec, Maciej. 2023. “The Debudgetisation of Public Finances in Poland After Covid‐19 and the War in Ukraine.” Politics and Governance 11 (4): 62–72.
https://doi.org/10.17645/pag.v11i4.7242
Graph View
How committed is the government to utilizing research and innovation as drivers for the transition to a sustainable economy and society?
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9
9
The government is clearly committed to utilizing research and innovation as drivers for the transition to a sustainable economy and society.
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6
7
6
The government is largely committed to utilizing research and innovation as drivers for the transition toward a sustainable economy and society.
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3
4
3
The government is somewhat committed to utilizing research and innovation as drivers for the transition toward a sustainable economy and society.
2
1
1
The government is not at all committed to utilizing research and innovation as drivers for the transition toward a sustainable economy and society.
Government attention to research and innovation has increased, but outcomes have been modest. Oversight for these areas falls under the Ministry of Development and Innovation and the Ministry of Education and Research. These bodies have issued strategies for sustainable development, such as “Innovations for a Digital, Green, Healthy and Socially Sustainable Future” (2022) and “State Scientific Policy” (2022). Although these strategies address digital and green transformation and sustainable development, their goals were broadly defined but not quantified, and were not formalized in legislation. The National Center for Research and Development (NCBR), which sits under the Ministry of Funds and Regional Policy, is tasked with advancing new technologies. Despite programs addressing strategic energy, AI and health, allegations of grant system transparency issues emerged in 2023.
One significant development in the research sector has been the evaluation of higher education institutions. The 2022 evaluation, which followed controversial changes in journal scoring – especially affecting Polish journals – was criticized for its impact on results and research relevance. The next evaluation will cover the 2022 – 2025 period.
There are positive signs, such as increased R&D spending. In 2022, gross domestic expenditure on research and development (GERD) rose to PLN 44.7 billion, an 18.6% increase from the previous year. GERD per capita reached PLN 1,182, up 19.2% from the prior year. The number of R&D entities grew by 0.8% (GUS 2023a). Pro-innovation tax incentives have been effective, with the R&D tax credit now allowing deductions of up to 200% of qualified costs. Between 2020 and 2022, 36.1% of industrial and 34.2% of service enterprises engaged in innovation. In 2022, revenue from new or improved products accounted for 6.9% of total sales for industrial enterprises and 2.7% for service enterprises (GUS 2023b).
In the 2023 European Innovation Scoreboard, Poland scored 68 points, surpassing the EU average within the “emerging innovators” category, but still well below the EU average of 110 points (European Commission 2023). In the area of eco-innovation, Poland outperformed the EU average in only two areas – water productivity and eco-innovation-related academic publications – and ranked second-lowest among EU members with a score of 67.4 points, comparable to the 2013 EU average (European Environment Agency 2023).
Citations:
European Commission. 2023. “European Innovation Scoreboard 2023.” https://op.europa.eu/en/web/eu-law-and-publications/publication-detail/-/publication/04797497-25de-11ee-a2d3-01aa75ed71a1
European Environment Agency. 2023. “Eco-innovation Index.” https://www.eea.europa.eu/en/analysis/indicators/eco-innovation-index-8th-eap
GUS. 2023a. “Research and Experimental Development in Poland in 2022.” https://stat.gov.pl/en/topics/science-and-technology/science-and-technology/research-and-experimental-development-in-poland-in-2022,7,12.html
GUS. 2023b. “Działalność innowacyjna przedsiębiorstw w Polsce w latach 2020-2022.” https://stat.gov.pl/obszary-tematyczne/nauka-i-technika-spoleczenstwo-informacyjne/nauka-i-technika/dzialalnosc-innowacyjna-przedsiebiorstw-w-polsce-w-latach-2020-2022,14,10.html
Markowski, Radoslaw. 2024. “Polish Election of 2023: Mobilization in Defence of Liberal Democracy.” West European Politics (forthcoming).
One significant development in the research sector has been the evaluation of higher education institutions. The 2022 evaluation, which followed controversial changes in journal scoring – especially affecting Polish journals – was criticized for its impact on results and research relevance. The next evaluation will cover the 2022 – 2025 period.
There are positive signs, such as increased R&D spending. In 2022, gross domestic expenditure on research and development (GERD) rose to PLN 44.7 billion, an 18.6% increase from the previous year. GERD per capita reached PLN 1,182, up 19.2% from the prior year. The number of R&D entities grew by 0.8% (GUS 2023a). Pro-innovation tax incentives have been effective, with the R&D tax credit now allowing deductions of up to 200% of qualified costs. Between 2020 and 2022, 36.1% of industrial and 34.2% of service enterprises engaged in innovation. In 2022, revenue from new or improved products accounted for 6.9% of total sales for industrial enterprises and 2.7% for service enterprises (GUS 2023b).
In the 2023 European Innovation Scoreboard, Poland scored 68 points, surpassing the EU average within the “emerging innovators” category, but still well below the EU average of 110 points (European Commission 2023). In the area of eco-innovation, Poland outperformed the EU average in only two areas – water productivity and eco-innovation-related academic publications – and ranked second-lowest among EU members with a score of 67.4 points, comparable to the 2013 EU average (European Environment Agency 2023).
Citations:
European Commission. 2023. “European Innovation Scoreboard 2023.” https://op.europa.eu/en/web/eu-law-and-publications/publication-detail/-/publication/04797497-25de-11ee-a2d3-01aa75ed71a1
European Environment Agency. 2023. “Eco-innovation Index.” https://www.eea.europa.eu/en/analysis/indicators/eco-innovation-index-8th-eap
GUS. 2023a. “Research and Experimental Development in Poland in 2022.” https://stat.gov.pl/en/topics/science-and-technology/science-and-technology/research-and-experimental-development-in-poland-in-2022,7,12.html
GUS. 2023b. “Działalność innowacyjna przedsiębiorstw w Polsce w latach 2020-2022.” https://stat.gov.pl/obszary-tematyczne/nauka-i-technika-spoleczenstwo-informacyjne/nauka-i-technika/dzialalnosc-innowacyjna-przedsiebiorstw-w-polsce-w-latach-2020-2022,14,10.html
Markowski, Radoslaw. 2024. “Polish Election of 2023: Mobilization in Defence of Liberal Democracy.” West European Politics (forthcoming).
Graph View
How committed and credible is the government in its activities to guide the effective regulation and supervision of the international financial architecture?
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9
9
The government is clearly committed to ensuring the stability of the global financial system.
8
7
6
7
6
The government is largely committed to ensuring the stability of the global financial system.
5
4
3
4
3
The government is somewhat committed to ensuring the stability of the global financial system.
2
1
1
The government is not at all committed to ensuring the stability of the global financial system.
Poland is not among the leading countries in global financial cooperation, and is not a G-20 member, despite aspirations fueled by its rising GDP, which reached 21st place worldwide in 2022. Nevertheless, the country is considered an attractive site for foreign direct investment (FDI), which reached a record high of $24.8 billion in 2021. According to the Polish Economic Institute (PIE), Poland ranked 14th globally and third in the EU with regard to FDI in 2021. Greenfield FDI has been resilient and increasing since 2015, with South Korea as the top investor in 2021.
Investors primarily come from Germany, France, the Netherlands and the U.S., with funds flowing largely into the manufacturing, wholesale/retail, finance and real estate sectors. Despite the country’s appeal, Polish law restricts foreign ownership in strategic sectors and limits real estate acquisition. New laws grant the president of the Office for Competition and Consumer Protection the authority to review FDI for security reasons. In 2022, controls on new foreign direct investment were extended until mid-2025.
Poland boasts a favorable business climate, ranking 29th out of 82 countries. Its banking industry is advanced, with Moody’s rating Poland’s creditworthiness at “A2,” the highest rating achievable. However, a significant challenge lies in the economy’s high dependency on foreign loans, which are used to fund social programs and military expenditures.
Additional challenges stem from the prestige and accountability of the National Bank of Poland (NBP). Under President Adam Glapiński, the NBP has faced controversies over having allegedly exceeded its official powers, as well as politicization, wastefulness and issues of collaboration among its organs. These factors could impact Poland’s international rankings and credibility (Lloyds Bank 2023).
Citations:
Lloyds Bank. 2023. “Foreign Direct Investment (FDI) in Poland.” https://www.lloydsbanktrade.com/en/market-potential/poland/investment
Jurkowska-Zeidler, Anna. 2023. “Public Interest in the Banking System.”
REGULATION. “Studia Iuridica” 98.
http://creativecommons.org/licenses/by/3.0/pl/
DOI: https://doi.org/10.31338/2544-3135.si.2023-98.7
Investors primarily come from Germany, France, the Netherlands and the U.S., with funds flowing largely into the manufacturing, wholesale/retail, finance and real estate sectors. Despite the country’s appeal, Polish law restricts foreign ownership in strategic sectors and limits real estate acquisition. New laws grant the president of the Office for Competition and Consumer Protection the authority to review FDI for security reasons. In 2022, controls on new foreign direct investment were extended until mid-2025.
Poland boasts a favorable business climate, ranking 29th out of 82 countries. Its banking industry is advanced, with Moody’s rating Poland’s creditworthiness at “A2,” the highest rating achievable. However, a significant challenge lies in the economy’s high dependency on foreign loans, which are used to fund social programs and military expenditures.
Additional challenges stem from the prestige and accountability of the National Bank of Poland (NBP). Under President Adam Glapiński, the NBP has faced controversies over having allegedly exceeded its official powers, as well as politicization, wastefulness and issues of collaboration among its organs. These factors could impact Poland’s international rankings and credibility (Lloyds Bank 2023).
Citations:
Lloyds Bank. 2023. “Foreign Direct Investment (FDI) in Poland.” https://www.lloydsbanktrade.com/en/market-potential/poland/investment
Jurkowska-Zeidler, Anna. 2023. “Public Interest in the Banking System.”
REGULATION. “Studia Iuridica” 98.
http://creativecommons.org/licenses/by/3.0/pl/
DOI: https://doi.org/10.31338/2544-3135.si.2023-98.7