OPPapers.com

M. Sc.

Jacek Osadnik
Poland

Polish Economy Outlook (1989 – 2007)

1. Introduction.

Since turning point of 1989, Poland has undergone great political, social and economic changes. The biggest achievement of Polish administration and economy are introduction of democratic structures, the shift from a command economy to the free market and wide-ranging systemic reforms.  

The start of the economic reform process was extremely tough. During the period of transformation, the Polish economy was still in an awful state and radical reform was selected as the only solution to save it. Without such reforms the costs of the transformation would have been significantly higher and Poland would not have come as far the road towards the EU as it has.

One fundamental priority of successive government has been economic growth. This is not only a condition of improving Poles' standards of living, but also a foundation for realizing the strategic goals of catching up with the developed economies of Europe and the rest of the world. The means of achieving this goals is EU membership.

The reforms of the transition period and subsequent hard and consistent monetary policy gave the Polish economy solid foundations: a strong currency and permanently falling inflation (currently at about 1%). The implementation of systemic reforms and responsible government policies, as well as improved global competitiveness, mean that expectation of a return to fast-track economic growth are justified.  

2. Polish Economy Cycles

The business cycle or economic cycle refers to the fluctuations of economic activity about its long term growth trend. The cycle involves shifts over time between periods of relatively rapid growth of output (recovery and prosperity), and periods of relative stagnation or decline (contraction or recession). These fluctuations are often measured using the real gross domestic product. Despite being named cycles, these fluctuations in economic growth and...