Polish finance minister reveals the secret of his success

Writing in the Wall Street Journal, Poland’s finance minister Jacek Rostowski claims the government’s refusal to spend its way out of the crisis explains why the country’s economy is expected to grow 1.5% in 2010.

What makes Poland stand out is the economic policy it pursued. That policy was based on a profound belief in free market economics. Fiscal policy is a good example of this approach. Most countries instituted stimulus programs at the beginning of the crisis. Those that did not were generally ones that could not obtain the necessary financing, such as Hungary or the Baltic states. Poland was probably the only country in Europe which could afford to finance a stimulus program, but decided not to. Indeed, we did exactly the opposite, cutting expenditure at the height of the crisis (in December 2008 and January 2009) by the equivalent of 1% of GDP. We also took additional revenue measures in July 2009 amounting to 0.8% of GDP.

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