“Since our last analysis, the risk for Polish public finances has increased. Significant fiscal deviations in the years 2024 and 2025, with a deficit of 6.7 percent of GDP, increased political challenges related to the implementation of fiscal means and the lack of a reliable strategy of fiscal consolidation will probably make Poland a significant reduction of fiscal deficit before the next election, parliamentary in 2027 ” – it was written in the report.
“We are currently expecting larger fiscal deficits that will lead to a rapid increase in public debt towards 68 percent of GDP to 2027” – Written.
The agency argues the decision to Poland
Fitch forecasts that the GG sector deficit will amount to 6.9 percent in 2025 GDP, in 2026 will lower to 6.8 percent. GDP, in 2027 to 6.3 percent GDP.
“The Fitch agency forecasts a further increase in the deficit to 6.9 percent in 2025 (more than twice as much as the median for the rating 'A' of 2.9 percent), and then its slight decrease to 6.8 percent of GDP in 2026, above the government's budget forecast of 6.5 %, and further up to 6.3 % in 2027 – it was written in the report.
“The forecast reflects our expectations regarding the limited possibility of increasing taxes and a further increase in public investments and defense expenditure (which according to NATO data are to increase to 4.5 percent), despite additional income resulting from freezing income tax thresholds and a slower increase in remuneration in the public sector and social expenses” – added.
Unfavorable forecast. Minister Domański reacts
This information was commented by the Minister of Finance Andrzej Domański. “The Fitch agency confirmed the Polish rating at A-, however, reducing its perspective. The decision is a consequence of, among others, the blocking by President Nawrocki, which limits the space to strengthen the foundations of the economy and the necessary fiscal consolidation. In the background there is a war in Ukraine and the need to bear record expenses for defense and global uncertainty, which was also the last Reduces of, among others, the US and Austria.
