Polish Economy – A Market-Oriented, Centrally Planned, and Natural Resources Country

Poland is a country in Central Europe. It is made up of 16 administrative provinces called voivodeships and has a population of more than 38 million. It is the fifth-most populous member state of the European Union. Its economic situation has been described as “market-oriented, Centrally planned, and natural resources”.

OECD Economic Survey of Poland

The OECD Economic Survey of Poland provides a detailed analysis of the country’s economy and society. Poland has been hit by the economic crisis COVID-19, but it has fared better than other European countries. However, Poland is facing an increasingly difficult economic climate. As a result, the Polish government is seeking to improve its economic performance to meet the challenges it faces.

Poland’s recovery plan outlines five investment priorities aimed at increasing the country’s competitiveness and resilience. These priorities include green energy efficiency, investment in the health care system, and investments in digital transformation. These investments will enable the country to tap into a market of more than 38 million people and the EU’s broader market of more than 500 million.

Poland’s economy has been robust in the past few years, with GDP growth of 4.6% in 2017 and 4% in 2018/19, a forecast that the OECD expects to maintain. This strong performance has been attributed to the country’s strong external environment, as well as policies aimed at improving inclusion and addressing poverty.

Centrally planned

The centrally planned economy and state socialism have been on the decline since the 1990s in Poland. While the country’s GDP and average family income increased, there were also significant changes in social conditions and the political landscape. These changes were gradual and not necessarily systemic. In some ways, the country has benefited from this decline in central planning, but the process is far from perfect.

Social unrest spreads throughout the country after the communists decide to raise prices on basic foodstuffs. The Security Service uses violence to repress protesters. Wladyslaw Gomulka, the leader of the ruling communist party, steps down and is replaced by Edward Gierek. Soon after the communists announce the price rise, mass protests break out in cities such as Plock, Ursus, and Radom. Despite the government’s brutal repression, the Workers’ Defense Committee provides legal assistance to protesters.

After the war, the communists in Poland rig the referendum and introduce legislation to nationalise the economy. The Communists attempt to control the country by repressing structures that are subordinate to the legitimate government. They also attack the Jewish community in Kielce, which becomes known as the Kielce Pogrom.

Market-oriented

After the economic crisis of the mid-1970s, Poland began the transformation from a command economy into a market economy. In the process, the government privatized some banks and recapitalized others. This created a more competitive environment and attracted strategic foreign investors. At the beginning of 2009, there were 51 domestic and 578 cooperative banks, with nearly 40 percent owned by foreign investors. This translates to a total of 68% of the banking capital in Poland.

Despite the initial setbacks, the country has made progress in its marketization efforts. In the first place, the government has been a key player in the restructuring of the economy, implementing structural reforms in areas such as privatization, social security, health care, education, and local government. These efforts have increased Poland’s economic growth, and the privatization of state-owned companies has been a key driver of that growth. While the economy has grown rapidly, some sectors such as agriculture have been negatively affected. Lack of investments and structural problems have hampered the transformation of the agriculture sector, but foreign investments have helped turn the tide.

The success of the Polish market-oriented economy has influenced reform efforts throughout the region and the former Soviet Union. It has also helped dispel fears about socialism’s adverse effects on the economy. In addition, the new economic system has led to substantial increases in production and the introduction of a price mechanism based on the market.

Natural resources

The role of natural resources in Poland’s economy is complex, but the country has a variety of natural resources to tap into. Poland is home to large deposits of coal in Upper and Lower Silesia. In the 1970s, the country became one of the world’s largest producers of hard coal, mining 201 million tons in 1979. By the late 1980s, hard coal had become a vital source of fuel, and it was also the country’s main source of hard currency.

The second-largest mineral deposit in Poland is sulfur, and the country ranks among the world leaders in sulfur production and reserves. Other important minerals are kaolin, limestone, marble, and barite. In addition, the country has an historic salt mine in Wieliczka, which has been in operation since the 13th century. The mine is now a UNESCO World Heritage site. Poland also holds important deposits of copper and zinc.

Poland’s oil and gas reserves are mostly found in the Lowland. The Swietokrzyskie Mountains and Upper and Lower Silesia provinces contain the richest deposits. Natural gas from the Lowland, meanwhile, is found in Carboniferous and Permian rocks, and contains high levels of nitrogen. Geothermal water is another resource that Poland has in abundance. The country has enough geothermal water to heat 30 million homes.

Integration into European Union

The integration of Poland’s economy into the European Union is a long-term objective, and its success will depend on the quality of the country’s macroeconomic, structural, and institutional framework. With proper planning, Poland can exploit the benefits and mitigate the risks of integration. Its medium-term economic strategy is composed of four main components: macroeconomic stabilization, strengthening the financial sector, structural reforms, and EU accession.

Poland’s economic growth has continued to increase, despite the financial crisis. Its GDP per capita has doubled since 1989, and its exports have increased 25-fold, to $250 billion in 2013. This growth rate has been faster than the growth rate of other large European economies of similar level. The country was the only one in the EU that did not suffer a recession during the 2008-09 global financial crisis, and its economic growth rates are now close to world records.

Poland has a diverse range of natural resources. Its major mineral asset is bituminous coal, but other coal resources are also mined. Much of the bituminous output comes from the Upper Silesian coalfield. However, in the late 20th century, the costs of extraction began to exceed profits, and falling prices have curtailed production. Other fuel resources include small amounts of petroleum and moderate deposits of natural gas.

Exports

The importance of exports in the Polish economy is clear. By far, the most significant export products are automobile parts and accessories, electric storage batteries, and seats (excluding barber and dentist chairs). Other notable export products include computers, optical readers, and miscellaneous furniture. Polish companies export a variety of other goods, including cigarette and cigar products, insulated wire or cable, and miscellaneous machinery.

In the past decade, Poland’s exports have more than tripled. In 2017, Poland exported over EUR 28.6 billion worth of goods and services. The largest export partners were Germany and the Czech Republic, which each accounted for almost a quarter of all exports. The United States, United Kingdom, France, and Italy all accounted for smaller shares. Poland also exports to Slovakia and the Netherlands.

Poland is a member of the European Union, and its exports have rebounded strongly. In 2011, exports in Poland fell by only 0.43% year over year, while imports fell by nearly five percent. The rapid recovery in exports, combined with high foreign direct investment, bodes well for the economy in the years ahead.

Trade with U.S.

Trade with the United States is an important way to support our economy and create jobs abroad. Exports are responsible for approximately 10.7 million jobs in 2019 and contribute nearly seven percent of total US employment. Imports, on the other hand, compete with American companies and help to keep costs low for middle and lower-income families.

China is one of the top two sources of imports for the U.S. and has been for decades. Despite a rocky beginning, the US-China trade relationship has rebounded and is now the largest trading partner in the world. The United States still imports from China nearly two-thirds of its goods. However, in the past several decades, China has shifted its exports from labor-intensive products to capital-intensive ones.

Despite the fact that free trade agreements have severely damaged our domestic industrial base, the Washington policy class continues to push for more of them. This policy has destroyed the economic security of millions of Americans. Republicans and Democrats alike have traded away the job security and income of American workers to foreign nations.