Warsaw short-term outlook downgraded, but medium-term prospects remain positive

We have downgraded the short-term outlook for GDP growth in Warsaw, as the Russian invasion of Ukraine and its fallout will weigh on economic activity. Rising food and energy prices coupled with increased uncertainty will dampen consumer spending growth. Supply chain disruptions and weaker European demand also pose a risk to manufacturing—although Warsaw’s exposure to this sector is far smaller than the Polish average. Despite this, we still expect GDP growth to top 4% in 2022 and 2023. Over the medium term we forecast strong GDP growth in Warsaw, with the Polish capital remaining one of Europe’s star performers.

What you will learn:

• Warsaw’s economy is being supported by strong productivity gains, with the city “catching-up” to more economically developed peers.
• Office-based sectors, such as finance & business services and ICT, account for a significant portion of the Warsaw economy.
• Productivity has nearly doubled since Poland joined the EU in 2004, however the city still has some way to go to catch-up with the European city average.