Goldman Sachs remains optimistic about Poland's mid-term fiscal outlook despite risks (opinion)
Goldman Sachs' economists remain optimistic about Poland's medium-term fiscal outlook, the bank's newest report showed. However, before the presidential election, the government's appetite for lowering the deficit may remain limited.
"With little political appetite to address the size of the deficit ahead of next year’s presidential election, we view the risks as being skewed towards larger deficits than the government is currently projecting in the near term. These risks are exacerbated by the costs of the severe flood that affected the southwestern part of Poland in September," the economists wrote.
"Nevertheless, we remain relatively sanguine about Poland’s medium-term fiscal outlook for two reasons: First, much of the fiscal easing in the past year has taken the form of one-off measures, whose importance as a share of GDP will decline with nominal growth. Second, Poland’s budgetary laws and its broader institutional framework have a strong track record in delivering fiscal discipline," they added.
According to Polish government's revised general government budgetary-structural plan, the forecasted deficit in years 2024 to 2028 will amount to 5.7 percent of GDP in 2024, 5.5 percent in 2025, 4.5 percent in 2026, 3.7 percent in 2027 and 2.9 percent in 2028.
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