"We have a peace dividend behind us, which was destroyed by
the events in Ukraine. The demographic rent that provided us with a
high supply of qualified personnel has also been exhausted. The current growth
model therefore requires corrections - says Andrzej Domański, Polish Minister of
Finance.
Poland, Europe and the world find themselves in an
exceptional time - we are a few weeks before the presidential elections in the
United States, just before the European Commission takes over the reins in a
new composition and less than three months before Poland takes over the
presidency of the EU Council. During the European Forum for New Ideas held in
Sopot, Finance Minister Andrzej Domański pointed out that this time of
"new deal" is taking place in very demanding conditions - after a
series of economic crises, a disruption of macroeconomic balance, and also
during the ongoing conflicts in Ukraine and the Middle East. This makes the future
exceptionally hazy today.
The goal? Maintaining a high rate of growth
- The word "uncertainty" in this increasingly
multipolar world is repeated and inflected by a growing group of politicians
and analysts today. Poland, nominally the sixth largest economy in the EU, and
after taking into account the difference in purchasing power - the fifth, will
have a key role to play. For many countries, we are an example to follow, being
the engine of growth of the EU economy. However, we live in pre-war times and
we must be ready for various scenarios. That is why we are already spending
over 4% of GDP on defense, and in the budget for next year we have secured 4.7%
of GDP, the most among all NATO members - explained Minister Domański during
his speech at EFNI.
Energy, migration, security issues and cooperation with
entrepreneurs, as well as the priorities of the Polish presidency - these are
the most important topics of the opening speech of Prime Minister Donald Tusk
during the EFNI conference in Sopot.
Despite this, in the second quarter of this year, our
country recorded the highest rate of growth among the large EU economies. In
2025, it is to be almost 4%, which – as the Minister of Finance notes – will
place us at the top of the OECD group. However, we cannot ignore threats from
the East.
– The surrounding reality poses new challenges. We are also
facing the excessive deficit procedure inherited from our predecessors. But our
goal is to maintain a high rate of economic growth. This year, real wages will
increase by 9%, the most in the 21st century. This drives consumption, which is
conducive to GDP growth. However, we need sustainable growth based to a greater
extent on investments – claims Andrzej Domański.
According to him, however, we must refer to the very high
dynamics of changes in global economic relations. – The departure from the
deepening of globalization processes is currently determined primarily by the
issue of economic security, which is, among other things, the result of
challenges from competing states such as Russia and China. As a result of
these tensions, protectionist activities are intensifying, and the effect is
the progressive fragmentation of the world economy – indicates the minister.
We are losing in the global race
As Andrzej Domański emphasizes, a debate has begun in the EU
on leaving the "economic comfort zone", and the pretext for a broader
discussion was, among others, Mario Draghi's report. - This is a painful but
accurate diagnosis of the challenges facing Europe. We are already losing in
many respects in the global technological race with the USA and Asian
countries. And we face new challenges: energy transformation, demographic
changes, new geopolitical conditions. We must draw conclusions and take
decisive action, because otherwise our socio-economic model will cease to exist
- warns Domański.
In his opinion, the biggest pain point of the EU is the lack
of economic growth. - Let's be honest: there will be no green economy, no
common security policy, no social cohesion if the European economy sinks into
long-term stagnation. Economic growth should be a priority in the context of
the policies introduced - he claims.
Investment is needed to revive growth. Meanwhile, Europe is
massively underinvested. Real investment outlays in the EU are currently only
10 percent higher than in 2007, before the great financial crisis. In the
United States, these outlays are 35 percent higher. "This shows this huge
disproportion in investment outlays, and we can see the effects of this in many
areas," Domański emphasizes. He notes that the EU missed out on, among
other things, the technology race.
The result? Today, one American company, Nvidia, is worth more
than the entire DAX index, which groups the largest German companies.
The need for a responsible migration policy
- Poland's improving situation in the international and EU
arenas and the upcoming presidency will allow our country to more effectively
influence the EU's responses to global challenges. I cannot turn a blind eye to
the depletion of our competitive advantages. We have a peace dividend behind
us, which was destroyed by events in Ukraine. The demographic
rent that provided us with a very high supply of well-qualified staff has been
exhausted. The current growth model therefore requires corrections - comments
the Minister of Finance. - Poles are an increasingly wealthy society, with
growing aspirations. Our task must therefore be to support modern branches of
the economy, based on knowledge. The energy transformation must be at the
center of both Poland's and Europe's attention. Skillful management of changes
in the European energy sector may not only allow for lower energy prices, and
thus improve the competitiveness of European companies, but also become a
powerful pro-development vehicle – he continues.
Minister Domański emphasized that at the same time we are
participants in a technological race and a fight to improve the efficiency of
our economy, and in this area we still have a lot of catching up to do.
– The robotization rate of the Polish economy is
disastrously low. The level of adaptation of IT solutions in Polish companies,
including AI technology, is one of the lowest in the entire EU – enumerates
Andrzej Domański.
According to him, in view of long-term negative demographic
changes, the process of shortages on the labor market has accelerated. This is
a huge challenge. – However, we must pursue a responsible migration policy. The
influx of labor migrants to our country is inevitable, but it must take place
in a controlled manner. It is necessary to attract employees from those
specializations to Poland, where there is a particular lack of domestic
resources. After all, the Polish economy has not been competing solely on low
labor costs for a long time. What we are focusing on and must focus on is qualified
staff – he adds."
Let us be honest. America competes with the EU for investment money and for
qualified migrants. We need peace in Ukraine, restore the flow of cheap
Russian gas into the EU, normalize trade with China, and develop our own AI
economy. Then and only then can we start moving on by building a
competitive technology of the future, becoming a strong support source for
our American friends, not just a dying place for extraction of investment
money and of high profits for energy companies.
