Eurozone storm blows into Poland

Don’t charge your glasses. A 20 per cent drop in Polish vodka exports in 2012 is at the centre of an economic downturn.

With solid internal markets, Poland appeared to be insulated from the Eurozone crisis, its economy growing by 4 per cent in 2011. Remarkably, Poland has posted growth figures for over 20 consecutive years, including in 2009, when it was the only Eurozone country not to fall into recession.

But the meltdown of the Eurozone is finally catching on. Poland’s biggest export market is floundering amid high unemployment and low consumer spending, which are on their way across the border.

Figures

Bloomberg published these figures on Jan 29.

“Consumer spending increased 0.5 per cent last year from 2.5 per cent in 2011, the weakest since at least 2001, today’s report showed. In December, employment fell for a second month, industrial output had its biggest slump in more than three years and retail sales fell the most since 2005. The jobless rate rose to 13.4 per cent, the highest in almost a year.”

So while not in recession yet, growth is slowing. Exports may have increased 13 per cent in 2011, but they only grew by 4 per cent last year.

Its internal market is likely to slump, with a spike in unemployment continuing to flow from the Eurozone. Italian car makers Fiat SpA recently laid off 1,500 Polish workers – an indication of things to come.