ADVERTISEMENT

Poland pays for lockdowns with the highest ever public debt

Debt

Photo by Roman Motizov/Shutterstock.com

The actual debt of the Polish sector of the general government is approaching the impassable – according to the constitution – threshold of 60% of gross domestic product (GDP), wrote Polish news portal Newseria.

This is mainly the result of the high financial aid that has been granted to companies in recent months to save them from bankruptcy and to keep jobs.

The pandemic caused the pace of Poland's indebtedness to accelerate sharply, and this results in, among others, high inflation, wrote the portal cited by the Warsaw Business Journal. According to the economist of the Warsaw School of Economics, Dr. Artur Bartoszewicz, we cannot afford further comprehensive lockdowns and they should be used only on a point-by-point basis.

"If we were to deal with another wave of lockdown, the risk related to the deterioration of economic conditions and the risk of bankruptcy of enterprises would, of course, be significant, and the public finance system would be significantly violated. Today we financed the exit from the crisis with debt, and we cannot indefinitely indebtedness," Bartoszewicz said.

The debt is not visible in the state budget itself, but it is published quarterly by the European Commission.

At the end of the first half of 2021, the debt of the public finance sector calculated using the EU methodology amounted to exactly PLN 1,402,042 million. That's 57.4% of Polish GDP. 

ADVERTISEMENT

Rate-setters augur slower decline in CPI in 2022 Analysis

Rate-setters augur slower decline in CPI in 2022

Lawmakers approve residency permit for digital nomads Parliament

Lawmakers approve residency permit for digital nomads

The strongest move - Morgan Stanley Hungary head and Chess F... Podcasts

The strongest move - Morgan Stanley Hungary head and Chess F...

ITM, capital gov't agree on support for public transport City

ITM, capital gov't agree on support for public transport

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.