The survey finds that Poland's overall economic performance in 1996-1997 has been commendable, even better than expected by outside observers or hoped for by authorities. The enviable results achieved for growth, disinflation, and unemployment reward the continuing adherence to prudent, if gradualist macroeconomic and structural policies.
Bolder fiscal action, however, is required to put public finances on a sustainable footing, to contain and subsequently reverse the widening of the current accounts deficit, and to support monetry policy in furthering disinflation. In this context, close prudential supervision of the financial sector is also important, as is improved corporate governance at large.
On the structural front, the new coalition government's programme involves deeper and faster efforts in some areas, consistent on most scores with the general direction of the market-oriented reforms carried out since late 1989. The favorable outlook in Europe should facilitate pursuit of these reforms.
As well, Poland's ambition to be among the first transition countries to join the European Union will be a powerful incentive to push ahead with the more difficult changes still in store. These changes, however, are indispensable in their own right if the momentum of the catch-up process is to be maintained.
