Poland has room for slower tightening of fiscal policy

Poland could still maintain its fiscal course with government support measures, unlike in other emerging economies, according to a report by Euler Hermes, a credit insurance company.

According to the analysts of Euler Hermes, the pandemic is loosening its grip on the global economy despite Omicron, the latest coronavirus variant. The analysts estimate that Omicron would cause a 0.3-percentage points drop in developed economies’ GDP growth.

"Global economic growth should remain strong although the gap between developed and emerging countries would widen," the report reads.

Euler Hermes economists noted that Poland, like other countries of the Visegrad Group "has the possibility to maintain support measures and slower fiscal tightening when compared to other emerging economies. It is possible thanks to moderate debt," the report indicated.

The analyst underlined, however, that state support should be "gradually withdrawn."

The analysts also projected that the GDP of the whole of Central and Eastern Europe should record a 3.3-percent growth in 2022 and 3.4 percent in 2023.