“The general government deficit of 1.8% GDP in 2021 showed the strength of Poland’s economy that has rebounded after the pandemic”, said chief economist of the Ministry of Finance Łukasz Czernicki, commenting on the latest data from the Central Statistical Office (GUS). 

According to the preliminary estimate of the Central Statistical Office, the general government deficit in 2021 was 1.8% of GDP against a deficit of 6.9% of GDP in 2020. Last year’s index was lower than expected by the market, which forecast a deficit of 2.2% of GDP. 

Czernicki says that there are many challenges ahead in months to come, but the result is 1.8 % of GDP, in terms of the general government deficit, is optimistic and shows the strength of the Polish economic that has rebounded after the pandemic. 

He added that last year’s deficit was also lower than the Ministry of Finance’s forecasts published in the middle of last year. The economist noted that back then there were completely different macroeconomic assumptions, due to lower inflation. 

“Our last forecast is from mid-2021, but then the macroeconomic indicators were completely different. We assumed that the general government deficit would amount to 5.3% of GDP”, emphasized Czernicki. 

The chief economist of the Ministry of Finance indicated that the general government deficit for 2021 is satisfactory because Poland’s deficit is significantly below the reference value included in the Maastricht criteria – 1.8% and it is significantly below 3% of GDP – and in Czernicki’s opinion, this is a good starting point for the challenges that Poland will face in the years to come. 

According to the chief economist of the Ministry of Finance, the biggest challenges facing the Polish economy are the likely economic slowdown related to the war in Ukraine, fiscal spending and an increase in military spending to 3% of GDP in 2023. 

Czernicki stated that the ministry is currently working on another forecast and will present it at the end of April as part of the Multiannual Financial Plan, which part is forming the so-called APK, i.e. the Convergence Program Update. 

Arkadiusz Słomczyński OF