Poland Economy - 2005

Economy - overview:
Poland has steadfastly pursued a policy of economic liberalization throughout the 1990s and today stands out as a success story among transition economies. Even so, much remains to be done, especially in bringing down unemployment. The privatization of small and medium-sized state-owned companies and a liberal law on establishing new firms has encouraged the development of the private business sector, but legal and bureaucratic obstacles alongside persistent corruption are hampering its further development. Poland's agricultural sector remains handicapped by surplus labor, inefficient small farms, and lack of investment. Restructuring and privatization of "sensitive sectors" (e.g., coal, steel, railroads, and energy), while recently initiated, have stalled. Reforms in health care, education, the pension system, and state administration have resulted in larger-than-expected fiscal pressures. Further progress in public finance depends mainly on reducing losses in Polish state enterprises, restraining entitlements, and overhauling the tax code to incorporate the growing gray economy and farmers, most of whom pay no tax. The government has introduced a package of social and administrative spending cuts to reduce public spending by about $17 billion through 2007. Additional reductions are under discussion in the legislature but could be trumped by election-year politics in 2005. Poland joined the EU in May 2004, and surging exports to the EU contributed to Poland's strong growth in 2004, though its competitiveness could be threatened by the zloty's appreciation. GDP per capita roughly equals that of the three Baltic states. Poland stands to benefit from nearly $13.5 billion in EU funds, available through 2006. Farmers have already begun to reap the rewards of membership via higher food prices and EU agricultural subsidies.

GDP:
purchasing power parity - $463 billion (2004 est.)

GDP - real growth rate:
5.6% (2004 est.)

GDP - per capita:
purchasing power parity - $12,000 (2004 est.)

GDP - composition by sector:
agriculture: 2.9%
industry: 31.3%
services: 65.9% (2004 est.)

Labor force:
17.02 million (2004 est.)

Labor force - by occupation:
agriculture 16.1%, industry 29%, services 54.9% (2002)

Unemployment rate:
19.5% (2004 est.)

Population below poverty line:
18.4% (2000 est.)

Household income or consumption by percentage share:
lowest 10%: 3.2%
highest 10%: 24.7% (1998)

Distribution of family income - Gini index:
31.6 (1998)

Inflation rate (consumer prices):
3.4% (2004 est.)

Investment (gross fixed):
18.4% of GDP (2004 est.)

Budget:
revenues: $44.52 billion
expenditures: $54.93 billion, including capital expenditures of NA (2004 est.)

Public debt:
49.9% of GDP (2004 est.)

Agriculture - products:
potatoes, fruits, vegetables, wheat; poultry, eggs, pork

Industries:
machine building, iron and steel, coal mining, chemicals, shipbuilding, food processing, glass, beverages, textiles

Industrial production growth rate:
10% (2004 est.)

Electricity - production:
133.8 billion kWh (2002)

Electricity - consumption:
117.4 billion kWh (2002)

Electricity - exports:
11.5 billion kWh (2002)

Electricity - imports:
4.5 billion kWh (2002)

Oil - production:
17,180 bbl/day (2001 est.)

Oil - consumption:
424,100 bbl/day (2001 est.)

Oil - exports:
53,000 bbl/day (2001)

Oil - imports:
413,700 bbl/day (2001)

Oil - proved reserves:
116.4 million bbl (1 January 2002)

Natural gas - production:
5.471 billion cu m (2001 est.)

Natural gas - consumption:
13.85 billion cu m (2001 est.)

Natural gas - exports:
41 million cu m (2001 est.)

Natural gas - imports:
8.782 billion cu m (2001 est.)

Natural gas - proved reserves:
154.4 billion cu m (1 January 2002)

Current account balance:
$-3.831 billion (2004 est.)

Exports:
$75.98 billion f.o.b. (2004 est.)

Exports - commodities:
machinery and transport equipment 37.8%, intermediate manufactured goods 23.7%, miscellaneous manufactured goods 17.1%, food and live animals 7.6% (2003)

Exports - partners:
Germany 29.8%, Italy 6.3%, France 5.4%, UK 4.7%, Czech Republic 4.4% (2004)

Imports:
$81.61 billion f.o.b. (2004 est.)

Imports - commodities:
machinery and transport equipment 38%, intermediate manufactured goods 21%, chemicals 14.8%, minerals, fuels, lubricants, and related materials 9.1% (2003)

Imports - partners:
Germany 29.8%, Italy 8%, France 7%, Russia 6.9%, Netherlands 5.3%, Belgium 4.2% (2004)

Reserves of foreign exchange and gold:
$41.88 billion (2004 est.)

Debt - external:
$99.15 billion (2004 est.)

Economic aid - recipient:
$17 billion in available EU structural adjustment and cohesion funds (2004-06)

Currency (code):
zloty (PLN)

Exchange rates:
zlotych per US dollar - 3.6576 (2004), 3.8891 (2003), 4.08 (2002), 4.0939 (2001), 4.3461 (2000)
note: zlotych is the plural form of zloty