Since the fall of the Berlin Wall in 1989, Jan Bartek has always believed in his country’s potential. That year marked Poland’s entry into a fiercely competitive market economy, after more than four decades of isolation under the communist system.

“We were coming out of a regime as a poor country, so we had a lot to recover,” explains this employee, nearing 50, at a car dealership in Warsaw. “The country now offers opportunities that, just a decade ago, were only seen in Western Europe,” Bartek says, emphasizing that car sales remain positive despite the turbulence the automotive sector has faced for several years. “It’s a sign that we haven’t been affected by any crisis,” he notes, while also revealing that his purchasing power has increased considerably: “They’ve raised my salary by 10% every year for the last five years, and not just for me, but for everyone I know in companies in other economic activities.”

This continuous and meteoric growth has even been dubbed the “Polish miracle.” “The fastest-growing economy in Europe? Poland’s!” Polish Prime Minister Donald Tusk said on social media in mid-August, sharing a chart placing his country first in the European Union, with a 0.8% increase in GDP in the second quarter of 2025 compared to the previous quarter and a 3.4% rise compared to the same period last year, according to Poland’s Central Statistical Office (GUS).

These figures, however, contrast with Eurostat data, which ranks Poland as one of the top five fastest-growing EU countries, with a 3% progression in the second quarter (annualized), double the average of the group of 27 countries that it joined in 2004. With the exception of 2020 and the COVID-19 pandemic-related recession, this Eastern European country has never entered a recession since joining the EU. And although GDP grew only 0.1% in 2023 due to rising energy prices and uncertainty over Russia’s offensive in Ukraine, it rebounded to 2.9% in 2024.

“There’s really no secret that weaker economies tend to grow faster,” notes Piotr Bartkiewicz, an expert at Bank Pekao, Poland’s second-largest commercial bank. “Establishing trade and capital connections with Western Europe, building essential infrastructure, and deploying an educated workforce in modern industries have propelled the economic momentum that has been constant over the past three decades.”

Undoubtedly, this dizzying progress is even more remarkable given the context in Europe, where Germany is teetering on the brink of recession and a war rages at Poland’s borders, with Russian drones even penetrating its territory.

A different model

This resilience is largely due to the strength of household consumption, which accounts for around 60% of GDP. With 37.4 million inhabitants, “Poland has a large domestic market, which makes it more resilient to crises than smaller neighbors such as the Czech Republic, Slovakia, or Hungary, which rely much more on exports, and it has a highly diversified economy which means we are not dependent on any specific sector,” notes Bartkiewicz.

What’s more, in recent months, inflation has stabilized at 2.7% in August, and the national currency — the zloty — has remained around 4.25 per euro since autumn 2023. Rising wages (up 7.6% in July compared to the previous year, according to GUS) have also helped boost household spending and retail sales, which increased by 4.8%.

Another driver of the Polish economy is European Union funds. In February 2024, the EU unblocked €137 billion ($160 billion) from the recovery plan, which had been frozen at the end of 2022 by the European Commission due to attacks on the rule of law and judicial independence under Poland’s previous far-right government of Mateusz Morawiecki. With the funds recently released, authorities are rushing to spend them as quickly as possible, as reflected in major investments in rail infrastructure.

The economic engine is running at full speed. According to the IMF, Poland is expected to rise to 20th place among the world’s largest economies this year, with a GDP of $980 billion. Already the fifth-largest EU economy in terms of purchasing power parity, Poland “has quietly become an engine of economic growth in Europe,” says Mateusz Urban, an analyst at Oxford Economics, who describes Poland as “a European tiger on Germany’s doorstep.”

However, Poland faces challenges if it wants to maintain this pace of growth. One issue is stagnant investment, which has fluctuated between 16% and 20% of GDP over the past 10 years. In 2024, it fell just below the 17% threshold, placing the country 25th out of 27 EU members, compared to a European average of 21.2%.

“It’s a structural problem in the Polish economy, but it also means that what was invested was done efficiently,” says Bartkiewicz, who attributes the low rate to companies’ more conservative mindset and a lack of managerial capacity.

On the other hand, Bartkiewicz warns that the tense relationship between the prime minister and the new nationalist president, Karol Nawrocki, could affect public finances: Poland faces a fiscal problem with a 6.6% public deficit in 2024, the second-highest in the EU after Romania at 9.3%.

“There is a social consensus to raise taxes or significantly reduce spending, but the measures proposed by the government have already been vetoed by the president,” says Bartkiewicz. He adds: “It is also a risk that the executive prioritizes pensions, military spending, or sovereign debt interest payments at the expense of more sophisticated sectors like science, technology, and education.”

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