Year Zero

What is fastest in Poland right now? Treasury debt servicing cost

Crisis, pandemic, war – undoubtedly, one can point to numerous explanations for the current state of the economy. However, the objective is not to engage in endless debates about the reasons why, at the turn of 2023 and 2024, the Polish economy is facing the challenge of nearly zero growth, persistent inflation exceeding the target 2-3 times, high financing costs, and rapidly growing debt servicing expenses. Why is it not worth it? Because it’s a futile exercise. Even a thorough diagnosis does not raise major doubts.

Where Do We Stand in Public Finances?

The outgoing government, after eight turbulent years for the global economy, leaves its successors with an economy experiencing zero growth and persistent inflation, projected to continue until 2028 according to the latest edition of the World Economic Outlook by the IMF surpassing the NBP target. Cumulative consumer inflation in 2019-23 exceeded 42 per cent.

Public debt, according to the previous government’s own estimates, is poised to approach 60 per cent of GDP by 2026. And today, it is not hard to identify the fastest-growing component – state debt servicing costs. In the beginning of the fourth quarter, these costs grew at an impressive rate of 87.5