The preferential system of social insurance for farmers is a deviation from the rule of uniform treatment of all citizens and a thorn in the flesh of reformers of public economy and finance. At the same time, it is a bastion of defence of rural politicians. The status quo in this area results in the persistently low efficiency of agriculture and discourages farmers from legal search for other sources of income.
LOT, the Polish national air carrier, wishes to apply for a considerable public aid amounting to PLN 400 million (about EUR 98 million), but needs as much as PLN 1 billion. Meanwhile, the prospect of the company's bankruptcy continues to loom large. What would its consequences be? Probably similar to those triggered by the collapse of the Belgian Sabena and the Hungarian Malev: loss of several thousand jobs, a poorer network of air connections, a drop in airports' revenues, serious problems of companies linked to LOT and possibly even more expensive airline tickets. But this is not the end of the world.
The Italian Fiat decided to close one of its manufacturing plants in Tychy, Poland. In 2013, Fiat's output in Poland will drop from 650 thousand two years ago to as little as 300 thousand cars. The problems of the Polish Fiat reflect like in a magnifying glass some of the important challenges faced by the Polish economy. Firstly, the high level of industrial productivity does not guarantee a fast development any more. Secondly, we live in an environment where capital has a nationality, and Poland's national capital remains limited. Let's hope that Fiat's problems do not presage an unfavourable period for the Polish economy.
Celowa Spółka Inwestycyjna (CSI), a special purpose company, is a provisional name of the company which is being created for the implementation of the government’s Polish Investments programme. Together with Bank Gospodarstwa Krajowego (BGK), it shall provide financial support when either the first or the last zloty is needed in the process of implementing major infrastructure projects - says Paweł Tamborski, Deputy Minister of the Treasury in an interview for Financial Observer.
On the one hand, State Treasury property slowly gains in value, on the other, public debt is mounting rapidly. As it seems, before long, public debt might exceed the value of State Treasury property. Debt increase is common knowledge, while the value of the said property and its structure is not. Let us check whether those assets are put to effective use.
Not only the state and extraction companies count on shale gas. Also gminas where drilling started count on higher revenues of local budgets. At the current level of extraction of 4.4 billion cubic metres of gas, gminas gain PLN 16 million. Following the changes proposed by the Ministry of the Environment, their revenues may increase to over PLN 60 million.
Polish innovative companies are rather concentrated on domestic market than on international expansion. That's one the main reasons of Poland's weak postion in rankings of innovation performance. According to biggest chances for Poland for getting strategic advantage in terms of innovations the competition in Europe is less in the health-care and biotech fields, so emphasis can be put on those areas of research and training of potential entrepreneurs says Franklin Pitcher Johnson.
The Conference Board, almost a hundred years old global business organisation, published its economic development projections several days ago. The projections say that between 2013 and 2018 Poland’s GDP growth rate would be 1.9%, and 1.5% between 2019 and 2025. The pessimistic option is that the growth would be ca. 1% a year, while optimists say it would be 2.7% and 2.0%.
MPC's last announcement makes it clear that the process of easing monetary policy has begun. We are witnessing an economic slowdown when it is difficult to keep the level of public debt in check. Our economy's sustainable development requires structural changes - says Professor Jerzy Hausner, a member of the MPC.
The finance minister believes that next year the European Union will decide to abrogate the excessive deficit procedure against Poland. This would give the government a free hand to implement reforms stimulating the economy. But Poland is at a distant position among 10 countries currently covered by the procedure and waiting for its abrogation.