beyondbrics

Some good news from Europe amid all the gloom. Poland’s GDP grew at 4.3 per cent last year, according to figures published on Friday. That’s slightly above expectations and comfortably higher than 2010′s 3.9 per cent. What’s more Marek Belka, the central bank governor, told Bloomberg television that he was “more optimistic than most analysts” – and forecast growth of over 3 per cent for 2012. Who else in the EU is going to match that?

Investors welcomed the news, with Polish equities rising 0.8 per cent and the zloty edging up 0.4 per cent against the euro to trade at 4.22 around noon Warsaw time. Buoyed by confidence in the domestic economy and by the general rise in emerging markets this year, the WIG20 index is up by 8 per cent this year and the currency by nearly 6 per cent.

If Belka’s forecasts prove correct, Poland will maintain its record as the EU’s best-performing economy since the global crisis struck in late 2008.

According to the Warsaw Statistical office, investment growth accelerated to 8.7 per cent in 2011 from a 0.2 per cent decline a year earlier, while growth in private consumption growth slowed marginally from 3.2 per cent to 3.1 per cent. Exports too were strong.

Investments have been boosted by anti-crisis public spending on infrastructure, on top of planned investments in preparations for the 2012 UEFA European Football Championships, which Poland is hosting jointly with Ukraine this summer.

The optimism in Warsaw contrast sharply with the economic warnings for central and eastern Europe issued this month by the World Bank, the International Monetary Fund and the European Bank for Reconstruction and Development, which all lowered their 2012 GDP forecasts for the region.

The EBRD, for example, now predicts GDP growth of 3.1 per cent for the whole of eastern Europe, Turkey and central Asia for 2012, compared to an October forecast of 3.2 per cent. For central Europe it foresees 1.4 per cent, down from 1.7 per cent. But for Poland it forecasts better things – raising its 2012 figure from 2.2 per cent to 2.3 per cent.

However, there is a big scorpion-like sting in the tail. The EBRD, like the World Bank and IMF, warned countries to prepare for a possible new eurozone shock that could take 4 percentage points of world growth, plunging many states (not least in CEE) into recession. Even Poland would struggle to survive that with its growth record intact.

Related reading:
Economic outlook darkens for eastern Europe, FT
Poland’s Lot gets Turkish interest, beyondbrics
Balcerowicz: Poland’s contstant economic thorn, beyondbrics
12 for 2012: Why Poland will avoid recession even if whole EU does not, beyondbrics