Poland recently became the first country in nearly a decade to graduate from emerging-market status and enter the ranks of the world’s developed economies. In September it joined countries such as the U.S., Germany and South Korea in the FTSE Russell index of advanced economies. For Poland, the first country in East-Central Europe to join the index, the distinction is the fruit of a long effort to build a flourishing market economy on the ruins of the communist system that the Solidarity movement helped topple in 1989.
It is especially gratifying for me as Poland’s prime minister. Thanks to the efforts of millions of Poles, our economy and financial markets now meet the highest standards of integrity, transparency and sound regulation demanded by international investors.
When Poland embarked on this remarkable journey, its economy was in a shambles. In 1989 per capita gross domestic product was only $1,800 in today’s dollars. Now it is $16,000. Poland is the biggest economy in the former Soviet bloc and the seventh largest in the European Union.
While many prospered, others were left behind. Too often connections, not hard work, provided success. In 2015 my party became the first to win an outright parliamentary majority since the fall of communism. We won the elections by promising to tackle corruption and pursue an inclusive growth strategy. The Law and Justice Party aims to embody the ideal of community that inspired the Solidarity movement and has always been a part of Poland’s social fabric.
Since 2015 we have improved tax collection and strengthened the nation’s fiscal position. We also have invested in health care, education and public works projects. We have shown that helping the least fortunate isn’t incompatible with growth: Poland’s economy has expanded by more than 10% in the past 2½ years, the most among the top 10 EU economies. Meanwhile, the fiscal deficit shrank to a record low 1.7% of GDP, from 7% in 2010. We achieved this while lowering tax rates on small companies.
How was this possible? With the help of stepped-up enforcement and innovative digital tools, we cracked down on rampant tax fraud and evasion, increasing revenue from the value-added tax by 26% in only two years. We prosecuted transnational gangs that systematically filed bogus invoices for reimbursement of the VAT, sometimes with the connivance of corrupt officials. Equally important, we introduced a tax regime that provides incentives for investment and research and development, particularly for small and medium-size firms.
While doing all this, we have expanded support for Polish families. We are spending more on vocational education to help young Poles engage in the modern economy. Our government has focused heavily on developing overlooked rural areas. All Poles should benefit from our country’s tremendous economic potential—and fulfill our common goals of solidarity, prosperity and growth.