Contradiction or strategy? Poland’s economic growth projections clash with EU-imposed fiscal tightening through the Excessive Deficit Procedure.
The European Commission forecasts robust economic growth for Poland in the coming years. After a rebound in 2024, Poland’s GDP is expected to grow at an accelerated pace in 2025, fueled by strong private consumption and increased investments. Despite this, net exports may dampen growth. Inflation predictions have been revised to 3.8% for 2024 and 4.7% for 2025, with unemployment projected to remain below 3% in 2025.
The Excessive Deficit Procedure Dilemma
Poland, along with six other nations, is subject to the EU’s Excessive Deficit Procedure (EDP), limiting fiscal flexibility. This includes defense spending, despite the Polish government’s efforts to exempt it. Critics argue that the EDP contradicts Poland’s growth outlook, as fiscal tightening could hinder development.
The Bigger Picture
The juxtaposition between EDP-imposed austerity and optimistic forecasts raises questions about EU policies’ alignment with member states’ economic realities. Can Poland truly thrive under such constraints?