There is no proven recipe for how to catch up with the richest. The past three decades have brought growth and civilisation change, yet we are still far from achieving steady convergence. To maintain the high pace of growth, we need to create conditions favourable for investment in means of production and make our economy resistant to crisis and economic shock - these are the main conclusions drawn in the PFR’s special report ‘Catching up with the richest in economics literature and practice in the past century - conclusions for Poland’ compiled by Paweł Dobrowolski, the PFR’s chief economist.
Despite wars, economic disasters and periodical renaissance, for a few past centuries there has been a more or less stable gap between Poland and the most developed countries. The past three decades stand out against this historical background as the time when Poland has made a civilizational economic jump. Our GDP per capita expressed as a percentage of the German GDP has jumped from 10% to 30% and - if the change in purchasing power is taken into consideration - from 30% to 60%. However, we have to bear in mind that such a spectacular growth is only a tiny fraction of what we need to do to catch up with the richest countries, just a brief episode and not a stable convergence trend.
“We cannot allow ourselves to settle for the success we have achieved. Poland may keep growing if we manage to transform our economy from a provider of cheap services and labour force to a provider of technologically advanced products and services within such fields as unmanned aircrafts, biotechnology and ICT. The so-called Morawiecki plan is to serve this purpose - it marks the first attempt to transform the Polish economy in two centuries, and it is not undertaken to reduce the effects of an economic crisis but as a leap forward,” says Paweł Borys, Polish Development Fund President. “I hope this report will be our guide, showing us the potential and real challenges that lie ahead of Poland and the ways to overcome them.”
“However, in order to follow the path of high growth, we will need to implement a number of activities to stabilise our economy and open it for the benefits of global trade, as well as to free it from excessive bureaucratic restrictions. These activities have been carried out and discussed by economists. But maintaining a high growth level for a long period of time is far more complex. It requires regular diagnosis of the most severe inhibitors, implementation of policies to reduce these effects and the creation of all sorts of institutions to support the development. These activities will differ for every economy,” says Paweł Dobrowolski.
What shall we do to maintain the extraordinary pace of economic growth? The report points to and describes several decisive factors:
- Macroeconomic stability and resistance to economic shock;
“We cannot allow ourselves to settle for the success we have achieved. Poland may keep growing if we manage to transform our economy from a provider of cheap services and labour force to a provider of technologically advanced products and services within such fields as unmanned aircrafts, biotechnology and ICT. The so-called Morawiecki plan is to serve this purpose - it marks the first attempt to transform the Polish economy in two centuries, and it is not undertaken to reduce the effects of an economic crisis but as a leap forward,” says Paweł Borys, Polish Development Fund President. “I hope this report will be our guide, showing us the potential and real challenges that lie ahead of Poland and the ways to overcome them.”
“However, in order to follow the path of high growth, we will need to implement a number of activities to stabilise our economy and open it for the benefits of global trade, as well as to free it from excessive bureaucratic restrictions. These activities have been carried out and discussed by economists. But maintaining a high growth level for a long period of time is far more complex. It requires regular diagnosis of the most severe inhibitors, implementation of policies to reduce these effects and the creation of all sorts of institutions to support the development. These activities will differ for every economy,” says Paweł Dobrowolski.
What shall we do to maintain the extraordinary pace of economic growth? The report points to and describes several decisive factors:
- Macroeconomic stability and resistance to economic shock;
- Empowerment of the community through accountability of authorities;
- An open social order;
- Creating a pro-development community what will enable a pro-development policy;
- Removal of micro-restrictions of growth;
- A modern industrial policy;
- Negotiating a place within the global system
Apart from these factors, ongoing experimentation, testing and learning from one’s own mistakes is necessary.
“The closer we get to the West in terms of our development, the bigger the need to discover, through experimenting, what the economic policies that facilitate growth will be. We need to develop a model of experimentation of economic policies that will be adjusted to our conditions and capabilities,” believes Paweł Dobrowolski. “Moving to a higher level of economic growth will require strenuous effort and bold experimentation in the search for optimum growth policies and institutions, as has been observed in the USA, Germany, France and Japan. I hope that this report will become an important voice in the discussion on how to achieve this ultimate goal,” adds Dobrowolski.
“The closer we get to the West in terms of our development, the bigger the need to discover, through experimenting, what the economic policies that facilitate growth will be. We need to develop a model of experimentation of economic policies that will be adjusted to our conditions and capabilities,” believes Paweł Dobrowolski. “Moving to a higher level of economic growth will require strenuous effort and bold experimentation in the search for optimum growth policies and institutions, as has been observed in the USA, Germany, France and Japan. I hope that this report will become an important voice in the discussion on how to achieve this ultimate goal,” adds Dobrowolski.
