About 3.1 percent. grew in the second quarter of this year, the Polish economy – GUS has reported. Friday’s data under increasing question put to realize the planned budget increase, which, according to the Minister of Finance has in 2016. Amount to 3.8 percent. Weaker GDP growth means lower tax revenues. What, therefore, the implementation of election promises? Experts point out that the team Beaty Szydło secured on the year, but keep saying that next can not miss even a dozen billion.
The head of the Standing Committee of Henryk Kowalczyk said earlier this week that even in this year could miss 5 billion zł on 500+ Family program. It is true that after the Ministry of Finance and the family quickly zdementowały these revelations, but on Friday the government hit the latest GDP data.
Poland’s economy grew in the second quarter compared with the same period a year ago, only 3.1 percent . Compared to the previous quarter, while GDP grew by 0.9 percent. This so-called “quick estimate”, and more detailed data CSO will release until the end of August. Friday’s reading anyway, but gives an overview of the current economic situation Polish.
We have a slightly higher growth than in the first three months of the year, but still far recorded in the budget assumptions for 2016. According to the finance minister at the time, GDP would increase by 3.8 percent. – The 3.8 percent. GDP growth is a good start. We hope for more – said the minister at the same time recalling that the previous government of PiS economic growth exceeded 5 percent. Economists, however, were skeptical from the beginning that such assumptions in the budget act.
Friday’s reading is also worse than what experts had expected. Economists interviewed by ISBnews and PAP predicted that GDP in the second quarter will increase by 3.3 percent. It turned out, that is 0.2 percentage points. worse.
“first-half results indicate that even with the expected upturn in the next two quarters, growth for the whole year will not exceed 3.4 percent. This will be the result of significantly lower than expected by the government 3.8 per cent., but from the point of view of the budget structure of growth will be somewhat more favorable, because the higher growth will achieve investment “- said in a comment sent money.pl analysts of Bank Millennium.
Even sharper courts Piotr Kuczynski, analyst Xelion. – Growth is feeble, and if we take into account that in the second quarter should see the effect of the program 500 plus, it is surprisingly weak – commented on the results. – You can see that the whole program 500 plus this year will add about two-tenths of a percentage point of GDP, or three tenths, but not half a percentage point, as expected optimists – he added.
increase disappointing, but the structure better
According to Kuczynski, therefore, the result rather forget about it, that will be realized by the government planned GDP growth of 3.8 percent. He also echoed by other experts.
– The result of 3.8 percent for the full year is unlikely. I tend to that, he will be closer to 3 percent – said money.pl Jakub Rybacki, an economist at ING Bank.
weaker than government forecasts GDP growth also showed Piotr Bujak, chief economist at PKO BP. – At the end of last year we said that the budgetary finance minister were optimistic, we believe the economy will grow this year by about 3.5 percent – predicted.
He added, however, that you can not just look at the number of dry but also in the structure of GDP growth. – Previously played a major role in the exports and investment, which in principle are tax-free, so the budget does not get out of it too much – notes Piotr Bujak. – More recently, the importance of gaining import and especially consumption, which carries VAT. And that’s good news for the budget – emphasizes economist.
In a similar vein speak the analysts of Bank Millennium. “The detailed structure of growth is not available, but it seems that the weaker result of the second quarter, corresponding to a further decline in investment in fixed assets, which suggested a poor performance of the construction industry. The main pillar of growth was probably private consumption, which was supported by rising real incomes of households home, including the payment of benefits under the family of 500+ “- said in a commentary.
What promises? Missing billions?
Weaker growth means less production and less investment, and thus indirectly also smaller tax revenues. Not everything in fact is impossible to compensate for the increasing consumption.
Economists suggest that this year’s funding promises the government should not make difficulties. – The budget will suffer only slightly, certainly not as much as if it was due to differences between plans and reality. The increase in consumption – and it’s a really big growth – will compensate for wrong initial assumptions about GDP – says Grzegorz Maliszewski, chief economist at Bank Millennium.
He added that to finance expenditure the government will have this year two more one-off payment: this money from the profit of the Polish National Bank, as well as funds from the auction LTE – a total of about 17 billion dollars.
– this creates a safety buffer when it turns out that the GDP is not growing as quickly as he expected Minister finance – highlights Piotr Bujak. According to him a greater threat than weaker economic growth may constitute inflation, which in 2016 was estimated by the Ministry amount to 1.7 percent. Meanwhile, in the first half of the year, every month we had to deal with deflation.
The additional one-off revenues to the budget will already be very difficult in the next year. And that’s why according to economists, is not 2016 but only 2,017 years will be a test for the government. Especially, we still do not know what the other promises that in last year’s elections made Andrzej Duda, President and Prime Minister of Law and Justice deputy. Still remains the failure to reduce the retirement age (the law was adopted by the government) and increasing the amount of tax-free.
In an interview with money.pl in May Maciej Reluga, BZ WBK chief economist, pointed out that next year the government may run out of about 12 billion to maintain the level of budget deficit planned for this year. Recall that this year’s deficit target is 54.7 billion, so another 12 billion would exceed the level of 66.5 billion dollars.
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