Coface estimates that GDP growth in Poland is at a weak level considering pre-pandemic standards

Report

Coface estimates that GDP growth in Poland is at a weak level by pre-pandemic standards, at 1% in 2023 after 4,4% in 2022.

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Coface estimates that GDP growth in Poland It is at a weak level considering pre-pandemic standards, 1% in 2023 after 4,4% in 2022.

 

La seventh edition of the Coface survey on the payments experience in Poland was carried out in November 2022 with the participation of 356 companies in the study. It was already a time when the economic consequences of the war in the neighboring Ukraine had materialized, and even companies were able to partially adapt to them.

 

However, high inflation, cost of raw materials, rising interest rates and concerns over subdued demand led to loss of growth momentum.

 

Until now, analysis on payment liquidity in Poland remains favorable. The study shows that Polish companies experienced payment delays by an average of 51,8 days, 5 days less than in the previous survey.

 

The reduction in payment delays was supported by the willingness of companies to accumulate stocks of products and components to avoid suffering from continuous price increases and therefore make payments even faster than requested. Macroeconomic data confirmed that inventory growth contributed to more than half of Polish GDP growth over the past seven quarters, that is, since the post-pandemic rebound began. However, this favorable image hides problems in the details. Energy-intensive sectors that have already suffered greatly from rising raw material prices saw greater delays in payments.

 

These include chemicals, paper-wood and agri-food products, and the latter not only suffer from higher electricity costs, but also agricultural and fertilizer prices. In these sectors, payments are made with an average delay of 2 months or more. On the other hand, the greatest improvement in reducing payment arrears was recorded in the transport sector, which had generally reported the highest payment arrears in previous surveys.

 

En general, the outlook is pessimistic. According to our survey, all sectors anticipate that the number of outstanding accounts receivable will increase in the coming months. This reflects the challenges facing companies: internal tax burden obstacles and high labor costs, as well as the consequences of the war in Ukraine, including higher costs of commodities, components, supply chain disruptions and a decline already received in income.

 

This responds to the gradual increase in business insolvencies in Poland. Considering both the asset liquidation contests and the ex officio restructuring processes announced by the courts, these processes have already skyrocketed by 23% in the first three quarters of 2022 compared to the same period last year.