2016 Index of Economic Freedom

Poland

overall score69.3
world rank39
Rule of Law

Property Rights65.0

Freedom From Corruption61.0

Limited Government

Government Spending46.5

Fiscal Freedom75.5

Regulatory Efficiency

Business Freedom68.7

Labor Freedom58.0

Monetary Freedom85.2

Open Markets

Trade Freedom88.0

Investment Freedom75.0

Financial Freedom70.0

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Quick Facts
  • Population:
    • 38.0 million
  • GDP (PPP):
    • $954.5 billion
    • 3.3% growth
    • 3.0% 5-year compound annual growth
    • $25,105 per capita
  • Unemployment:
    • 9.2%
  • Inflation (CPI):
    • 0.0%
  • FDI Inflow:
    • $13.9 billion
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Poland’s transition to a free-market economy has been facilitated by structural reforms and an increasingly vibrant private sector. Openness to global commerce and trade, competitive taxation, and an efficient regulatory system have encouraged more dynamic and broadly based economic expansion. A new bankruptcy and insolvency code will take effect in 2016.

Economic Freedom Snapshot

  • 2016 Economic Freedom Score: 69.3 (up 0.7 point)
  • Economic Freedom Status: Moderately Free
  • Global Ranking: 39th
  • Regional Ranking: 18th in Europe
  • Notable Successes: Open Markets and Monetary Freedom
  • Concerns: Management of Government Spending and Labor Freedom
  • Overall Score Change Since 2012: +5.1

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Background

Poland joined NATO in 1999 and the European Union in 2004. The center-right Civic Platform Party was ousted following parliamentary elections in October 2015. The conservative Eurosceptic Law and Justice Party headed by Prime Minister Beata Szydlo won a parliamentary majority. With a flexible exchange rate, a legally independent central bank with an IMF credit line, access to international markets, and healthy economic policies, Poland was the only European country to experience economic growth during the 2009 credit crisis. Increasingly concerned about Russia’s activities in the region, Poland has agreed to host the next NATO summit in 2016. Low rates of investment in agriculture have made Poland uncompetitive in food production, but the automotive, pharmaceutical, aviation, steel, and machinery sectors have made it one of the EU’s strongest economic performers. The private sector now accounts for two-thirds of GDP.

Rule of LawView Methodology

Property Rights 65.0 Create a Graph using this measurement

Freedom From Corruption 61.0 Create a Graph using this measurement

Allegations of corruption occur most frequently in government contracting and the issuance of regulations or permits that benefit a particular company. Incidents of corrupt behavior by customs and border guard officials, tax authorities, and local government officials show a decreasing trend and, if proven, are usually punished. The legal system protects rights to acquire and dispose of property. The judiciary is independent but slow.

Limited GovernmentView Methodology

The top income tax rate is 32 percent, and the corporate tax rate is a flat 19 percent. Other taxes include a value-added tax and a property tax. The overall tax burden equals 32.7 percent of total domestic income. Government spending accounts for 42.2 percent of GDP, and the budget continues to have a small deficit. Public debt amounts to less than 50 percent of GDP.

Regulatory EfficiencyView Methodology

The entrepreneurial framework is conducive to launching and running businesses, and the bankruptcy process is now streamlined. Labor regulations are more stringent than those of other countries in the region. In 2015, due to losses from Russia’s food import ban, the government asked the EU to loosen rules on state subsidies for inefficient coal mines and to reinstate export subsidies to Polish pork and milk producers.

Open MarketsView Methodology

EU members have a 1 percent average tariff rate. Trade agreements are currently being negotiated with countries that include the United States and Japan. Some state-owned enterprises remain in operation. Foreign and domestic investors are generally treated equally. The growing banking sector has become more competitive, and capital markets are expanding.

Country's Score Over Time

Bar Graph of Poland Economic Freedom Scores Over a Time Period

Country Comparisons

Bar Graphs comparing Poland to other economic country groups Download Charts

Regional Ranking

rank country overall change
1Switzerland810.5
2Ireland77.30.7
3Estonia77.20.4
4United Kingdom76.40.6
5Denmark75.3-1.0
6Lithuania75.20.5
7The Netherlands74.60.9
8Germany74.40.6
9Luxembourg73.90.7
10Iceland73.31.3
11Czech Republic73.20.7
12Georgia72.6-0.4
13Finland72.6-0.8
14Sweden72-0.7
15Austria71.70.5
16Norway70.8-1.0
17Latvia70.40.7
18Poland69.30.7
19Cyprus68.70.8
20Spain68.50.9
21Belgium68.4-0.4
22Macedonia67.50.4
23Armenia67-0.1
24Malta66.70.2
25Slovakia66.6-0.6
26Hungary 66-0.8
27Albania65.90.2
28Bulgaria65.9-0.9
29Romania65.6-1.0
30Portugal65.1-0.2
31Montenegro64.90.2
32France62.3-0.2
33Serbia 62.12.1
34Turkey62.1-1.1
35Kosovo61.4N/A
36Italy61.2-0.5
37Slovenia60.60.3
38Croatia59.1-2.4
39Bosnia and Herzegovina58.6-0.4
40Moldova57.4-0.1
41Greece53.2-0.8
42Russia50.6-1.5
43Belarus48.8-1.0
44Ukraine46.8-0.1
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