Polish Toledo

This blog is associated with www.polishtoledo.com

Wednesday, April 23, 2014

Put your foot on the accelerator

Speeding up natural gas exploration in Poland would be a good thing given the situation with Russia concerning Ukraine and the possibility of consequences regarding sanctions and  trade embargoes.  The halt of Russia importing food products from Poland would put a large dent in Poland's economy as would Russia cutting off or jacking up prices for energy.

While Poland is predicted to be a storehouse of shale gas and shale oil,  French petroleum company Total SA  acknowledged that the potential Polish gas reserves are cost prohibitive for them. The investigation process is still in its early stages, and the Polish gas reservoirs are more taxing than the industry expected. The industry may need to invest much time before one starts the exploration process. Deep research is needed at the current juncture to accumulate and analyze huge amounts of data. ConocoPhillips and Chevron are collecting this data and checking on the economic feasibility as Total has decided to call it a day as far as Poland is concerned.

Individual Wealth Up in Poland

GDP per capita in Poland will be 74 percent of the EU average by 2017, according to a plan prepared by the country's finance ministry and cited by the Polish Press Agency. In 2008, GDP per capita in Poland was 56 percent of the EU average and rose to 67 percent in 2012.

Finance Minister Mateusz Szczurek forecasts 2014 GDP growth at 3.3 percent and 3.8 percent in 2015. Meanwhile, unemployment is expected to fall to 9.8 percent (from 13.6 percent in March) by the end of this year and stand at 7.9 percent by 2017.

Holding Off on Euro

Finance Minister Mateusz Szczurek said in an interview for news station TVN24 Biznes i Świat that it is is unlikely for Poland to join the euro zone before 2020,  .

“I think that it is very unlikely for us to be able to pay in euro in Poland until the end of this decade, that is until the end of 2020,” he said.

Szczurek added that adopting the common EU currency would contribute to Poland's economic stability only when the euro zone is a stable economy itself. “It worth joining the euro zone only when it is favorable and safe for the Polish economy,” he said.

The finance minister also confirmed that there are plans to cut the main VAT rate in Poland back from 23 percent to 22 percent in 2017.