Why all roads lead to Warsaw

Since its transition to democracy and capitalism in 1990 Poland has steadfastly pursued a policy of economic liberalisation and is now one of the most successful economies in the new Europe. This is in no small part due to the so-called 'shock tactics’ of the 90s finance minister Leszek Balcerowicz and his privatisation policies. Despite Balcerowicz’s considerable success, however, there is still a good deal to be done, not least the pruning of an oversized, inefficient and at times corrupt bureaucracy. Steps are being made in that direction, however, and the government has introduced a plan to cut public spending by $17 billion by 2007.

Another serious problem is unemployment, although recent governments have had some success in tackling it. Recent figures (September 2005) put it at 17.7%, down over one percentage point from the previous year. A particularly troublesome sector is agriculture, which is handicapped by small, inefficient farms, surplus labour and a lack of investment. This is further hampered by farming community’s stubborn resistance to change.

More positive developments can be seen in the growth of small private businesses and, in Warsaw, the rapid expansion of the banking and finance sector. This, in turn, has led to huge investment in real estate in the capital, pushing rental prices down.

Since joining the EU in May 2004, the country has seen its exports shoot up, which has led to strong growth in the past two years. Poland is also benefiting from $13.5 billion worth of EU funds. 2005 saw a big effort to advertise Warsaw and Poland as a whole as a top-notch business and tourism destination. Results were impressive, with tourism up 7% in the first half of the year. The introduction of budget flights to Poland in 2003 would also have affected that figure, and traffic through Warsaw’s Okecie airport has seen a huge rise. A new terminal is being built to cope.