Flag: two equal horizontal bands of white (top) and red; similar
to the flags of Indonesia and Monaco which are red (top) and white
Economy ———-
Economic overview: In 1995, Poland continued to make good progress in the difficult transition to a market economy that began on 1 January 1990, when the new democratic government instituted "shock therapy" by decontrolling prices, slashing subsidies, and drastically reducing import barriers. Although real GDP fell sharply in 1990 and 1991, in 1992 Poland became the first country in the region to resume economic growth with a 2.6% increase. Growth advanced to 3.8% in 1993, 5.2% in 1994, and 6.5% in 1995. Most of the growth since 1991 had come from the booming private sector, which now accounts for about 60% of GDP, due in large part to the creation of new private firms. The slow pace of privatization picked up somewhat in 1995, as 512 smaller state enterprises were transferred to private National Investment Funds under the Mass Privatization Program, but large-scale industry remains largely in state hands. Industrial production increased 10.2% in 1995, following a 13.2% rise in 1994, yet remains about 13% below the 1989 level. Inflation, which had approached 1,200% annually in early 1990, fell to 21.6% in December 1995, as the government held the 1995 budget deficit to less than 3% of GDP. After peaking at 16.9% in July 1994, unemployment gradually fell to 14.9% in December 1995 - although the rate still approaches 30% in some regions. The trade and current account balances officially are in deficit but in fact both have comfortable surpluses because of large, unrecorded sales to cross-border visitors. Prospects for 1996 are good, with the government promising to push privatization and social welfare reform. Economic growth should remain above 5%, with inflation dropping below 20% by yearend 1996 and unemployment continuing its slow decline. As for external debt, the burden was sharply reduced by reschedulings and write-offs of both private and official debt during 1991-94.
GDP: purchasing power parity - $226.7 billion (1995 est.)
GDP real growth rate: 6.5% (1995 est.)
GDP per capita: $5,800 (1995 est.)
GDP composition by sector: agriculture: 7% industry: 38% services: 55% (1993)
Inflation rate (consumer prices): 21.6% (December 1995)
Labor force: 17.743 million (1994 annual average) by occupation: industry and construction 32.0%, agriculture 27.6%, trade, transport, and communications 14.7%, government and other 25.7% (1992)
Unemployment rate: 14.9% (December 1995)