Analysts also warn that public finances are "approaching the limits of safe flexibility."
The existing model of economic growth in Poland is being exhausted, and the pace of convergence with the strongest economies in Europe is noticeably slowing down. This was reported by analysts from the Warsaw Enterprise Institute.
The institute's experts noted that after three decades of accelerated development, Poland has reached a level that not long ago seemed a distant dream.
In their opinion, maintaining GDP growth momentum requires a qualitative change in the economic development model.
It is noted that the main limiting factor for growth is the decline in private investments from 23–24% to 17% of GDP.
The situation is even worse with corporate investments: their share decreased from 12% of GDP (2000–2004) to only 9.3% of GDP in 2020–2024. Meanwhile, neighboring EU countries are faring much better.
Experts believe that innovation and intangible capital remain the "weak link in the Polish development model."
Analysts also warn that public finances are "approaching the limits of safe flexibility."
The ratio of debt of state and municipal institutions to GDP has risen from about 36% of GDP in 2000 to around 55% of GDP in 2024, while debt servicing costs in 2024 were twice as high as government spending on higher education and science.
The institute recommends focusing on increasing corporate investments and redirecting funds from short-term expenditures to projects that enhance productivity, such as automation, energy transition, and digitalization.
They also call for strengthening long-term savings through a "system of tax incentives (including revising capital gains tax for long-term investments) and developing capital elements of the pension system."
WEI also advocates for "restoring balance in public finances and improving the quality of expenditures."
"The report recommends shifting the focus from funding research for the sake of research to supporting the implementation, scaling of innovations, and creating testing environments (regulatory sandboxes, zones of quality law), especially in the areas of digitalization, AI, knowledge-intensive services, and modern manufacturing," the authors added.
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