According to the Polish Economic Institute, Germany has remained one of Poland’s key economic partners for years. “Nearly 10 % of Poland’s GDP in 2018 depended on trade with our western neighbour, of which more than 7 % was attributed to the demand of the German end users, and another 2.6 % is due to Germany’s export of Polish added value”, reports the Polish Economic Institute (PIE) in its report “Trade and investment cooperation between Poland and Germany”.

PIE analyses the two countries’ trade balance in terms of GDP and job creation, the structure of trade exchange, as well as mutual cooperation in the form of direct investment.

„There is a clear asymmetry in the importance of the two countries in mutual trade, which is due to differences in the size of the economies. Trade with Germany is several times more important in creating value added and jobs in Poland than trade with Poland in creating value added and jobs in Germany. For this reason, Germany is much more important for Poland than Poland is for Germany,” says Łukasz Ambroziak, senior advisor in PIE’s global economy team.

Poland is Germany’s fifth trading partner in exports and fourth in imports. Poland became the fourth supplier of goods to its western neighbour during the COVID-19 pandemic, when it overtook France. Poland has already recorded a goods trade surplus with Germany since 2012, reaching €9 billion in 2021.

As PIE notes, the recession in Germany will undoubtedly affect the condition of Polish exports there. Nearly half of it consists of parts and components used in German factories, which produce largely for export. At least half of Polish exports to Germany, however, supply the domestic market there. It follows that a reduction in household consumption and business investment activity will automatically translate into a poorer performance of Polish exports to Germany.

Adrian Andrzejewski