Transcript Prezentacja programu PowerPoint

Poland's experience in economic
reforms.
What can Ukraine learn from it?
Patryk Toporowski
The Polish Institute of International Affairs
Bratislava, 03.06.2016
Poland's 26 years of change
Total re-orientation:
- 5-pages long(!) „ustawa Wilczka” act (1988) - level of
deregulation not existing later in Poland
- „Plan Balcerowicza” in 1990 (transformation from central
planning to market economy) known as well as „shock
therapy”: included 10 acts.
- OECD (1996), NATO (1999), EU (2004) entry
- Economic re-opening to the Western Europe (trade,
investment)
- Later, gradual (sometimes excessive) regulation
- High social understanding and acceptance of the shock
reforms in the early 90.
Plan Balcerowicza



In fact it was an implementation of the
Washington consensus, structural adjustment
plan (but much effort on monetary stability).
Difficult conditions:
–
Initial inflation +639,6% a year.
–
Initial Debt 64,8% of GDP
–
Initial dollarisation of domestic commerce
It included cutting subsidies for fossil fuels.
Are 26 years enough?
„I’ve never tought, that I notice a change during my life”
Leszek Balcerowicz, about the beginning of transformation
The end of transformation is close.
Since 2009, Poland is classified as high income
country by the World Bank. (Czechia, 2006;
Slovakia 2007; Hungary 2007-2011, 2014)
According to IMF: only Czechia and Slovakia are
advanced economies.
But... huge social costs were paid in the
beginning and many bottlenecks remain.
Main lessons – general economic freedom
Determinants of economic success (PL bad or
good experience):
- Market economy (facilitated by the structural reforms)
- Openness to the global commerce and trade
- Special economic areas (inducing FDIs)
- Efficient regulation and high quality administration
- Simple (or competitive) tax system
- Focus on SME, potential to innovate (Google Campus)
Main lessons – economic freedom
But it’s difficult to find an instant, direct relation
between economic freedom and prosperity
Horizontal axis: Index of Economic Freedom, Vertical: GDP per capita
Correlation: 0.06, (but without 2008 is 0.33 – effect of crisis)
Purchsing power parity enables to see a link
between the prosperity and economic freedom
Horizontal axis: Index of Economic Freedom, Vertical: GDP per capita (PPP)
Correlation: 0.985
Purchsing power parity enables to see a link
between the prosperity and economic freedom
Horizontal axis: Index of Economic Freedom, Vertical: GDP per capita (PPP)
Correlation: 0.985
Main lessons – Flexible labour markets
Apart from it: a huge package of deregulation of professions
Main lessons – Flexible labour markets
The importance of the low tax wedge
Regular job contract
Mandatory contract (since
2016)
Specific-task contract
Salary
919,07 EUR*
Salary
919,07 EUR*
Salary
919,07 EUR*
Employee's
costs
263,95 EUR*
Employee's
costs
250,14 EUR*
(depending on
eligible costs)
Employee's
costs
132,35 EUR*
Employer's
costs
189,42 EUR*
Employer's
costs
165,98 EUR*
Employer's
costs
Net salary to
gross „gross”
salary
59,1%
Net salary to
gross „gross”
salary
61,65%
Net salary to
gross „gross”
salary
* According to mean NBP exchange rate 1EUR=4,473 PLN,
27.01.2016
Nowadays serious talks about reducing the tax wedge
or simplifying tax on labour
85,6%
Main lessons – structure of labour
important
Main lessons – Flexible labour markets
It is not about only employer-oriented
flexibility.
Actions to enhance the availability of people
excluded from the market – reactivation benefits:
- telework grants for mothers after maternity leave
- childcare education system
- cofinance of training
Main lessons – Education
Central exams at the end of primary and lower/upper
secondary school.
School's rankings.
Revival of vocational schools.
Ideas to introduce practical innovation in early stage
education – programming classes in the beginning of primary
schools. Entrepreneurship classes.
Much orientation towards the labour market.
Universities obtained quite a flexibility in setting the education
agenda (new unique majors).
Main lessons – Budget
A crucial issue: minimisation of the tax base erosion, tax
avoidance and tax evasion.
Simplicity of the tax code.
Keep the public spending and debt low ('constitutional
anchor') or keep the balanced spending to income.
Raising awareness in the society about the effects of the debt
(debt counter, „average bills”).
Thank you!