Despite Poland’s GDP drop caused by the coronavirus crisis leading to the first yearly GDP decrease since 1995, it was still less severe than forecasted.
Poland’s GDP in 2020 suffered a real decrease of 2.8 percent compared to 2019, according to the initial data of Statistics Poland. This is the worst reading of the GDP index in the last 25 years and the first yearly decrease since 1995 when comparable data was available for the first time.
Economists expected a drop in Poland’s GDP by 2.8 percent after it had grown by 4.5 percent in the previous year.
Over the course of 2020, regression was noted in all sectors of the economy. The added value in industry, however, decreased only by 0.2 percent. In construction, the drop was 3.7 percent, in trade 4 percent, and private consumption went down by 3 percent. The value of investment expenditure shrunk by 8.4 percent.
In total, this meant a drop of 3.7 percent in domestic demand. Therefore, foreign trade must have had a positive impact on the GDP but Statistics Poland has not yet published data on export and imports.
The Polish GDP decrease was part of a global phenomenon.
Due to the policy of lockdowns, the global economy suffered the deepest recession since the Second World War. Despite an improvement in the economic situation in the second half of 2020, the United States noted its strongest GDP decrease in 74 years. Germany’s economy shrunk by 5 percent and this was its largest decrease since 2009.
The second quarter of 2020 had the most impact on the yearly GDP result due to it being the period in which the first lockdown was introduced in Poland. Poland’s GDP dropped by 9 percent quarter to quarter, compared to a 0.4 percent drop in the first three months of 2020. Statistics were saved by the third quarter in which economic growth reached 7.9 percent growth year-on-year.
Statistics Poland underlines, however, that the data is still initial and may be revised.
Official data on the fourth quarter of 2020 will be released in February.