The rating agency Standard & Poor’s (S&P) announced its decision to maintain Poland’s rating at A-/A-2 for long- and short-term foreign currency obligations and A/A-1 for long- and short-term domestic currency obligations. The rating outlook remained stable.

S&P lowered its growth forecast for Poland for 2023 to 0.9 %, justifying this by the continuing economic effects of Russia’s aggression against Ukraine.

According to S&P, despite spending pressures ahead of this year’s parliamentary elections and increased financing, the Polish government’s decision to end some tax cuts related to energy prices is likely to lead to a smaller deficit than the agency had anticipated, helping to stabilise the level of net public debt at a reasonable 45 % of GDP. 

At the same time, the drop in natural gas prices in Europe and the slight improvement in the economy point to an easing of short-term macroeconomic risks for Poland. The agency believes that Poland’s competitive, diversified economy, strong external position and sound public finances will minimise the negative risks posed by the war in Ukraine.

According to S&P, an upgrade of Poland’s rating is possible if Poland maintains economic growth and good public finances after the effects of the conflict have subsided. On the other hand, the rating could come under pressure if the negative impact of the conflict in Ukraine is larger and more prolonged than currently expected, resulting in a significant economic slowdown in the medium term. A downgrade would also be possible in the case of smaller transfers of funds from the European Union as a result of political tensions between Poland and the EU authorities.

Arkadiusz Słomczyński