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Brief look at Polish economy in trying times

First hit by the global pandemic in 2020 and 2021, now the Polish economy is facing growing inflation and an additional weight generated by the arrival of Ukrainian refugees fleeing from the Russian invasion of their home of Ukraine.

As Poland’s Central Statistical Office (GUS) data released on Friday show, central and local governments in Poland recorded a deficit of 1.8 percent of GDP in 2021, down from a deficit of 6.9 percent of GDP in 2020.

The debt of the public finances sector reached 53.8 percent of GDP in 2021, down from 57.1 percent of GDP recorded in 2020, GUS wrote.

Inflation predicted to surge to 12.2 percent in April

Meanwhile, Lewiatan, an employer organisation, has predicted that inflation in Poland will surge to 12.2 percent in April after the stats office reported a record-high CPI figure for March.

In a flash estimate on Friday, the GUS said the prices of consumer goods and services increased in March by 10.9 percent y/y and 3.2 percent m/m, the highest level since 2000 in annual terms.

“Inflation, in line with expectations, has crossed yet another psychological barrier,” Lewiatan’s economist, Mariusz Zielonka, said in a comment on Friday.

Fuels were the main driver of inflation, as prices at petrol stations surged by almost 30 percent in March, Mr Zielonka noted, adding that food prices were also a major contributor to the growth.

“Given the current scenario of developments, the growth will probably be even stronger in April and will exceed 12.2 percent,” he forecast.

Santander Bank Polska said in a comment on Friday that the monthly increase of inflation in March was the highest since January 1996.

Massive employment drive

As the economic situation grows ever more disconcerting, Polish firms live up to their moral duty employing over 21,000 Ukrainians following the opening of Poland’s labour market to refugees.

Family and Social Policy Minister Marlena Maląg presented the figures covering the period up to March 29 following a meeting of the Social Dialogue Council on Friday.

According to the official, over 900 people have been registered as seeking employment and around 8,000 Ukrainians have expressed interest in vocational training in order to find a job.

In accordance with current regulations, Ukrainian citizens are allowed to start working in Poland without a work permit.

Most Ukrainians have found a job in Poland’s largest cities, namely Warsaw, Wrocław and Poznań.

Over 2.4 million refugees, mainly women and children, have crossed the Polish-Ukrainian border into Poland since Russia invaded Ukraine over a month ago.

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