Poland economy – Strong export performance narrows external deficit

Event

Despite the problems of its trading partners in the euro zone, Poland enjoyed another strong export performance in the third quarter, as it successfully increased sales to markets further east.

Analysis

In January-September exports rose by 1.9% year on year, to €104.3bn (US$131bn). Imports amounted to €111.4bn, 2.6% lower than a year earlier, despite the growth of the domestic economy. As a result, the deficit on goods trade narrowed from €12bn in January-September 2011 to €7.1bn a year later.

Poland has been successful in reorienting trade away from the euro zone towards more rapidly growing markets like Russia, Ukraine and developing countries. As a result, the euro value of exports to the EU fell by 0.8% year on year in January-September, whereas exports to Russia and Ukraine both rose by more than 20%, and exports to developing countries grew by more than 15%.

This strong trade performance is helping to narrow the current-account deficit. On the basis of provisional monthly figures released by the central bank, Poland ran a current-deficit of €9.1bn (3.3% of GDP) in January-September, significantly smaller than €12.8bn (4.7% of GDP) in the year-earlier period. Other components of the current account also contributed to the smaller overall deficit, with the surplus on services rising from €3.3bn to €4.1bn, and the deficit on income shrinking marginally, to €12.4bn.

Article from:

Read the full articlepdf10.42 kB

EY refers to one or more of the member firms of Ernst & Young Global Limited (EYG), a UK private company limited by guarantee. EYG is the principal governance entity of the global EY organization and does not provide any service to clients. Services are provided by EYG member firms. Each of EYG and its member firms is a separate legal entity and has no liability for another such entity's acts or omissions. Certain content on this site may have been prepared by one or more EYG member firms