EBRD upgrades 2024 growth forecast for Poland

The European Bank for Reconstruction and Development (EBRD) has revised its GDP growth forecast for Poland upwards to 2.9 percent for 2024, from a forecast of 2.7 percent in September 2023. In 2023, the economy stagnated on the back of a drop in private consumption and heavy destocking.

The upward revision for 2024 reflects strong growth in the first half of the year, driven by domestic demand and EU-funded investments, in part as a result of falling inflation and relatively loose fiscal policy.

The Bank expects Poland’s economy to grow by 3.5 percent in 2025.

The forecasts were published today in the Bank’s Regional Economic Prospects report, which foresees a slowdown in growth in the EBRD regions to an average of 3 percent this year, a 0.2 percentage point downward revision on the September 2023 forecast. The revision reflects, in part, slower-than-expected growth in late 2023 and early 2024 in central Europe, especially in Czechia, Estonia, Hungary and the Slovak Republic, in line with weak growth in Germany.

Despite the expected growth performance, the report highlights potential risks to economic recovery, such as Poland’s fiscal deficit which exceeded the EU’s fiscal rules in 2023 and is likely to remain high in 2024. According to the report, fiscal consolidation and reforms are needed to reduce the deficit and boost growth potential. A possible resurgence of inflation may also impede recovery.

The report also highlights Poland’s “EU accession bonus” – the fast growth of per capita income experienced by the country over the last 20 years thanks to its membership in the European Union. This high growth is attributed, among other factors, to a rapid growth in exports relative to GDP as Poland became deeply integrated into European and global supply chains.

The EBRD is among the leading institutional investors in Poland. Since the start of its operations in the country in 1991, the Bank has invested more than €14 billion in 527 projects. Last year the Bank invested a record €1.3 billion in Poland.