President Andrzej Duda signed an amendment to the Public Finance Act, aiming to introduce a mechanism to correct the excessive imbalance of public finances determined by the appropriate level of fiscal effort.
Changes to the Public Finance Act include:
– introduction of a mechanism to correct the excessive imbalance of public finances;
– inclusion in the stabilizing construction of the expenditure rule, the so-called defense clause, which, in the opinion of the Council of Ministers, reflects discrepancies between advance payments (payments) for the purchase of military equipment and deliveries of equipment, which influence the result of the government sector;
– an indication that the draft budget law provides for a general reserve of up to 0.2% of GDP. budget expenditures;
– the creation of a legal basis for the creation of a specific reserve for expenditure, the amount of which cannot be determined during the drafting period of the budget law;
– introduction of the possibility of creating a specific provision for expenditure related to the fight against the infectious disease caused by the SARS-CoV-2 virus (COVID-19) or for aid to Ukraine related to the armed conflict on the territory of this country;
– increase the limit of reserves in the parts of the state budget managed by individual voivodes to 2 percent. planned costs and laying the basis for including in these provisions costs for termination benefits and termination benefits related to retirement due to disability.
As a rule, the law enters into force on the day after that of its promulgation.
Poland’s GDP decline
Poland entered a technical recession. In the second quarter of 2023, GDP fell by 0.5 percent. Every year. In the previous quarter, the decrease was 0.3 percent. “According to the flash estimate, seasonally adjusted gross domestic product (GDP) fell 0.5% year-on-year in real terms in the second quarter of 2023, compared to an increase of 6.1% in the same period of 2022.” The Central Bureau of Statistics reports this in a statement. The data provided comes as a surprise to experts who did not expect such a large drop. The market consensus for the second quarter was 0.3%. decline on a seasonally unadjusted basis.
Seasonally adjusted gross domestic product fell by 3.7% in real terms in the second quarter of this year (in constant prices with reference year 2015). compared to the previous quarter and was 1.3 percent lower than the year before. The data from the Central Bureau of Statistics are quick estimates. Full second quarter 2023 GDP data will be released on August 31. If GDP falls for two quarters in a row, we can speak of a technical recession, regardless of seasonal factors. Economists point out that the technical recession proves that economic growth in the country has slowed. The effects of the technical recession include a decline in external and internal demand, a reduction in the number and volume of investments, which may translate into a further decline in GDP in the following quarters.
Source: Do Rzeczy
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
