A Polish deputy finance minister has predicted that 2023 will be a difficult year for the country’s public finances, but added that “there are grounds for cautious optimism.”
Deputy Finance Minister Artur Soboń addresses the ESG Polish Business Power conference at Warsaw’s National Stadium on Monday, November 7, 2022. PAP/Marcin Obara
Artur Soboń made the statement at a policy event in Warsaw on Monday, public broadcaster Polish Radio’s IAR news agency reported.
Soboń told the ESG Polish Business Power conference at the capital’s National Stadium: “In terms of fiscal policy, 2023 will be a difficult year, but looking at our starting point, there are grounds for cautious optimism.”
He said that forecasting the future „has become particularly challenging” after a host of „high-profile, hard-to-predict and rare events” in recent years, such as the COVID-19 pandemic, a migration crisis on the Polish-Belarusian border, the war in Ukraine, and “huge inflation around the world.”
He added: “Each of these events could be called a black swan event, and so we have had a multitude of such black swan events recently.”
Polish economy expected to slow down in 2023
Soboń warned that those in charge of public finances would „face challenges” because “Poland is definitely poised for an economic slowdown.”
He added, however, that “judging by how fast our businesses and our economy have rebounded, with GDP growing by 8.5 percent in the first quarter of 2022, the foundations of our economy are strong.”
Soboń stated: “This year, GDP will grow by more than 4 percent, making Poland one of the five fastest-growing European Union economies, but next year the growth will be much slower.”
He told the conference: “Following another crisis, we’ll manage to quickly restart internal engines of growth and the economy will grow again.”
’Cautious fiscal policy’ in 2023, ‘middle-of-the-road’ approach
Speaking during a panel discussion entitled Crisis and War: What Lessons Will the Polish Economy Draw?, Soboń said that the government „will have to pursue a cautious fiscal policy, especially next year.”
He added that the government had chosen “a middle-of-the-road approach,” rejecting „irresponsible” ideas floated by the opposition, such as „20-percent salary increases and a four-day workweek” and ignoring calls for „no safety nets” and policies aiming „to tame inflation at all cost, even if that leads to high unemployment.”
Defence spending a priority in 2023
Soboń said that, in the wake of Russia’s invasion of Ukraine, defence spending would be a priority for Poland in 2023, totalling PLN 140 billion (EUR 29.9 billion).
Investment spending will also „reach significant levels,” he added.
He told the conference that Poland’s budget deficit was „relatively low” at the end of 2021, at 2 percent of GDP, while the country’s public debt, at around 54-55 percent of GDP, was “well below the EU average,” Polish state news agency PAP reported.
(pm/gs)
Source: IAR, PAP, bankier.pl