The World Bank has lowered its forecast for Poland’s GDP growth in 2022 by 0.8 percentage points to 3.9 per cent, the Bank said. In 2023, GDP growth will be 3.6%. The Bank estimates that Ukraine’s economy will decelerate by 45.1% this year.
As the World Bank report points out: “Europe and Central Asia Economic Update, Spring 2022: War in the Region”, since Russia’s attack on Ukraine “is affecting” the economies of the countries of Europe and Central Asia, the forecast for Poland’s Gross Domestic Product (GDP) growth in 2022 was decelerated to 3.9%.
It is pointed out that GDP growth in Poland may be above the Central European average, but as a result of the war the forecast has been lowered by 0.8 percentage points compared to the forecasts published in the January report “Global Economic Prospects.”
Poland, where almost 60% of the people who fled Ukraine have taken refuge, can expect a significant increase in demand for public services and housing resources, “which will put additional pressure on public finances.”
“On the other hand, positive impulses for the economy can be expected in the short term if domestic demand increases,” it was assessed.
According to the latest forecast by the World Bank, Poland’s GDP growth in 2023 will be 3.6% – 0.2 percentage points higher than in January 2022.
“Russia’s attack on Ukraine will have serious consequences for the whole of Central Europe, with consequences such as refugee flows, rising commodity prices, a decline in foreign demand from the euro area and a deterioration in economic sentiment,” it was stressed.
World Bank experts predict that economic growth in the euro area as a whole will slow to 3.5% in 2022 due to inflationary pressures, tighter monetary policy and greater political uncertainty, which will lead to a weakening of domestic demand.
“The war in Ukraine and the pandemic show once again that crises can cause far-reaching economic damage and set us back years in terms of the value of per capita income and economic development,” Asli Demirgüç-Kunt, Chief Economist for Europe and Central Asia, was quoted in the World Bank.
“Regional authorities should, in particular, strengthen their macroeconomic buffers and enhance the credibility of policies to reduce the risk of disrupting trade and investment chains, strengthening social security to protect the most vulnerable groups, including refugees; and continue efforts to improve energy efficiency to ensure long-term sustainable development,” the economist adds.
Economists of the bank estimate that the GDP of the region’s emerging and emerging economies will shrink by 4.1% by 2022, while pre-war forecasts predicted growth of 3%.
“The forecast has been updated as the economic shocks triggered by the war intensify the impact of the COVID-19 pandemic that continues. If this forecast comes true, there will be “a second recession in two years, twice as large as the pandemic recession in 2020.”
The World Bank estimates that the Ukrainian economy will shrink by 45.1% this year, although the extent of this phenomenon will depend on the intensity and duration of hostilities. Russia’s GDP is expected to decline by 11.2% in 2022.
“The Russian economy, weakened by sanctions, is plunging into a deep recession – it was said. Experts also predict that Belarus’s GDP will fall by 6.5% by 2022.”
It was recalled that immediately after Russia attacked Ukraine on 24 February, the World Bank Group launched an exceptional financial package of USD 925 million in support of Ukraine.