GDP up in Q2

Consumer demand and individual consumption were close to levels recorded in the first quarter. Marcin Bednarski

Poland’s GDP in the second quarter has grown by 5.1 percent, making it one of the European Union’s strongest performing economies. The figure is a touch down from 5.2 percent growth in Q1 but when seasonally adjusted evens out at 5.0 percent annually.

The Central Bureau of Statistics released the data attributing the strong result to economic growth across all sectors.

“We could be speaking about a positive contribution from all the sectors of the economy -- both in production and services”, stats office GUS national accounts director Maria Jeznach told reporters.

Value added growth in the construction sector would possibly exceed 20 percent, although it might be slightly lower than in the first quarter, Jeznach indicated. Value added growth across all industries would likely exceed GDP growth.

Consumer demand and individual consumption, on the other hand, were close to levels recorded in the first quarter, she said, helped by local government spending.

“Based on monthly data, we think domestic demand was the key driver, led by private consumption and recovering investments”, said economist Jakub Rybacki from ING Bank Śląski.

A risk to the forecast, a report from ING said, was related to external demand and Eurozone sentiment.

Poland’s Finance Minister Teresa Czerwińska said: “This was due to the high dynamics of the two main components of domestic demand: mainly private consumption, which is supported by an exceptionally good situation on the labour market and very good consumer sentiment, but also by investments, especially in the sector of government and local government institutions.”

But she warned: “Assuming that in the following quarters GDP growth rate will remain at the level from the second quarter - counting on seasonally adjusted data – the annual growth rate in the second half of this year will decrease to around 4.5%, and in 2019 it will fall below 4%.

“This in turn means that we can be currently in the best economic situation, and subsequent readings may be less optimistic.

“The biggest risk for the Polish economy prospects is the situation in the external environment, in particular in Germany, our main trading partner.”

The full figures will be released on August 31.

Poland has enjoyed constant positive GDP growth since it entered the free market in the early 90s.

It consistently ranks as one of the strongest performing economies in the European Economic Area.