POLAND’S ECONOMY 2
Poland is the sixth largest economy in the EU. Since 1990, the country’s economic
trajectory has been firmly positive. Its gross domestic product (GDP) has doubled in size during
this period. Classified as a high-income economy by World Bank, its service sector contributes
to 62.7% of GDP (Poland Ministry of Treasury, 2012). In 2015, the economic growth rate was
3.7% making it one of the best in Europe.
Poland’s privatization of the small and medium state-owned companies and relaxation of
laws required in establishing new firms resulted in the growth of its private sector in the 1990s
(Orlowski, 2011). The private sector emerged as the primary economic driver of the country’s
economy after the restructuring. However, the agricultural sector has dragged behind other
economic sectors due to surplus labor, structural problems, the inadequacy of investment, and
inefficiency of small farms (Orlowski, 2011).
Several factors make Poland a good option for inwards investment. First, Poland’s robust
internal market has over the years insulated it from external economic pressures. Economists
identify the solid private consumption and strong internal demand of Poland as the main reason
for this phenomenon. Most notable was the 2008/09 economic crisis period. During this period,
the country’s GDP grew by 1.6% making it the only country in the EU to have positively
developed its economy (Faris, 2013).
Secondly, Poland’s economy has been growing faster than that of the EU region. In 2010,
its 3.9% growth in GDP was the third largest among EU states and the 4.5% GDP growth
recorded in 2011 was the fourth largest (Faris, 2013). Finally, Poland has profoundly reformed
its legislations since joining the EU. It restricted government interference in the private sector,
strengthened its intellectual property rights, competition law, and financial markets, and