Republic of Poland
CAPITAL: Warsaw (Warszawa)
FLAG: The national flag consists of two horizontal stripes, the upper white and the lower red.
ANTHEM: Jeszcze Polska nie zginela (Poland Is Not Yet Lost ).
MONETARY UNIT: The zloty (z) is a paper currency of 100 groszy. There are coins of 1, 2, 5, 10, 20, and 50 groszy and 1, 2, 5, 10, 20, 50, and 100 zlotys, and notes of 10, 20, 50, 100, 200, 500, 1,000, 2,000, and 5,000 zlotys. A currency reform on 1 January 1995 replaced 10,000 old zlotys with 1 new zloty. z1 = $0.31348 (or $1 = z3.19) as of 2005.
WEIGHTS AND MEASURES: The metric system is the legal standard.
HOLIDAYS: New Year's Day, 1 January; Labor Day, 1 May; National Day, 3 May; Victory Day, 9 May; All Saints' Day, 1 November; Christmas, 25–26 December. Movable holidays are Easter Monday and Corpus Christi.
TIME: 1 pm = noon GMT.
Situated in Eastern Europe, Poland has an area of 312,680 sq km (120,726 sq mi), extending 689 km (428 mi) e–w and 649 km (403 mi) n–s. It is bounded on the N by the Baltic Sea, on the n and e by Russia, Lithuania, Belarus, and Ukraine, on the s by Slovakia and the Czech Republic, and on the w by Germany, with a total land boundary of 2,788 km (1,794 mi) and a coastline of 491 km (305 mi). Comparatively, the area occupied by Poland is slightly smaller than the state of New Mexico.
Before World War II, Poland encompassed a territory of nearly 390,000 sq km (150,600 sq mi). On 11 July 1920, an armistice mediated by Britain in a Polish-Soviet conflict established the "Curzon line" (named for George Nathaniel Curzon, the British statesman who proposed it), conferring the former Austrian territory of Galicia to the Soviet side. However, under the Treaty of Riga (1921), all of Galicia was assigned to Poland, and a boundary well to the east of the Curzon line prevailed until World War II. At the Yalta Conference in February 1945, the Allies accepted Soviet claims to eastern Poland, with a border running approximately along the Curzon line.
On 21 April 1945, a Polish-Soviet treaty of friendship and cooperation was signed, followed by a new agreement on the Polish-Soviet border. To compensate for the loss of 46% of Poland's territory to the USSR, the Potsdam Conference of July–August 1945 placed former German territories east of the Oder (Odra) and western Neisse rivers under Polish administration, pending a final determination by a German peace treaty. On 6 August 1950, an agreement was signed between Poland and the GDR according to which both parties recognized the frontier on the Oder-Neisse line. The Federal Republic of Germany (FRG) recognized this boundary under the terms of a treaty signed with Poland on 7 December 1970 and ratified by the FRG on 23 May 1972.
Poland's capital city, Warsaw, is located in the east central part of the country.
Poland's average altitude is 173 m (568 ft); 75.4% of the land is less than 200 m (656 ft) above sea level. The highest point, Mount Rysy (2,499 m/8,199 ft), is located in the Tatra Mountains on the Slovakian border. The principal topographic regions are an undulating central lowland with a crystalline platform and warped bedrock; the Baltic highland in the north, a glaciated region with many lakes and sandy soils; and the coastland, a narrow lowland with promontories, bays, and lakes. The southern uplands are marked by rich loam and mineral deposits.
Several important navigable rivers drain into the Baltic Sea, among them the Vistula (Wisla), the Oder, the Bug, and the Warta. There are over 6,000 lakes in the northern lake region. Good harbors have been developed on the Baltic Sea.
Poland has a continental climate, conditioned especially by westerly winds. Only the southern areas are humid. Summers are cool, and winters range from moderately cold to cold. The average mean temperature is about 7°c (45°f); temperatures in Warsaw range, on average, from -6° to -1°c (21–30°f) in January and from 13° to 24°c (55–75°f) in July. Precipitation is greatest during the summer months, lasting 85 to 100 days. Annual rainfall ranges from about 50 cm (20 in) in the lowlands and 135 cm (53 in) in the mountains; the overall average is about 64 cm (25 in).
Coniferous trees, especially pine, account for 70% of the forests; deciduous species include birch, beech, and elm. Lynx, wildcat, European bison, moose, wild horse (tarpan), and wild goat are among the few remaining large mammals. Birds, fish, and insects are plentiful. As of 2002, there were at least 84 species of mammals, 233 species of birds, and over 2,450 species of plants throughout the country.
Poland's environmental situation has improved since the ousting of its communist regime, which has been accompanied by decreased emphasis on heavy industry and increased government awareness of environmental issues. However, Poland has yet to recover from the overexploitation of forests during World War II and the loss of about 1.6 million hectares (4 million acres) of forestland after the war. As of the mid-1990s, 75% of Poland's forests have been damaged by airborne contaminants and acid rain. In 2000, about 29.7% of the total land area was forested.
Pollution of the air, water, and land was the most significant environmental problem facing Poland in the 1990s. Air pollution results from hazardous concentrations of airborne dust and chemicals, including carbon dioxide, nitrogen compounds, fluorine, formaldehyde, ammonia, lead, and cadmium. In 1992 Poland had the world's 12th highest level of industrial carbon dioxide emissions, which totaled 341.8 million metric tons, a per capita level of 8.9 metric tons. In 1996, the total rose to 356 million metric tons. However, some measures for reduction must be working, since in 2000, the total of carbon dioxide emissions was at 301.3 million metric tons. Industry-related pollution affects particularly the Katowice region, where dust and sulfur dioxide emissions exceed acceptable levels.
Water pollution in the Baltic Sea is 10 times higher than ocean water. Poland has 54 cu km of renewable water. Eleven percent of the annual withdrawal is used to support farming and 76% is for industrial purposes.
The nation's wildlife has also suffered from degeneration of its habitats. As of 2003, 12.4% of Poland's total land area was protected. According to a 2006 report issued by the International Union for Conservation of Nature and Natural Resources (IUCN), threatened species included 12 types of mammals, 12 species of birds, 3 species of fish, 1 type of mollusk, 14 species of other invertebrates, and 4 species of plants. The cerambyx longicorn and rosalia longicorn are among the endangered species. The wild horse has become extinct.
The population of Poland in 2005 was estimated by the United Nations (UN) at 38,163,000, which placed it at number 32 in population among the 193 nations of the world. In 2005, approximately 13% of the population was over 65 years of age, with another 17% of the population under 15 years of age. There were 94 males for every 100 females in the country. According to the UN, the annual population rate of change for 2005–10 was expected to be stagnant at 0.0%, a rate the government viewed as too low. The fertility rate, at 1.6 births per woman in 2005, has been below replacement level since the mid-1990s. The projected population for the year 2025 was 36,661,000. The population density was 118 per sq km (306 per sq mi).
The UN estimated that 62% of the population lived in urban areas in 2005, and that urban areas were growing at an annual rate of 0.18%. The capital city, Warsaw (Warszawa), had a population of 2,200,000 in that year. Other large metropolitan areas and their estimated populations were Katowice, 2,914,000; Lódz, 943,000; Gdańsk, 851,000; and Kraków (Crakow), 822,000.
Large-scale emigration from Poland took place before World War II, with the heaviest exodus in the decades before World War I. Between 1871–1915, a total of 3,510,000 Poles, Polish Jews, and Ukrainians emigrated, about half of them to the United States. Emigration diminished greatly during the interwar period, when France became the chief country of destination. From 1921–38, some 1,400,000 Poles emigrated, while 700,000 returned. Poland suffered a net population loss of nearly 11,000,000 between 1939–49 through war losses, deportations, voluntary emigrations, and population transfers arising out of territorial changes. An estimated 6,000,000 Germans left the present western territories of Poland when these territories came under Polish jurisdiction, and since the end of World War II more than 7,500,000 Poles have settled in the area. From the 1950s through the 1980s, Germans leaving for Germany constituted the bulk of emigrants; Jews also left in substantial numbers for Israel, both in the immediate postwar years and during the 1950s and 1960s. Another emigration wave occurred after the imposition of martial law in December 1981. In 2000, the total number of migrants was 2,088,000. In 2003, total remittances to Poland were $2.8 billion. In 2005, the Polish Ministry of Labor reported that 500,000 Poles were legally employed in 15 EU countries. Amongst these, Germany was the chief destination for Polish migrant labor, 350,000 legally admitted workers, including 90% employed seasonally in agriculture.
Since 1989, Poland has been open to refugees. However, while tens of thousands of people transit Poland every year, the number of recognized refugees has been rather limited. As of 2004, there were 2,507 recognized refugees. Since 1997, there has been a significant increase in the number of asylum applicants, from some 800 in 1995 to 3,743 in 2004. The main country of origin was the Russian Federation, with smaller numbers from India and Pakistan. In that same year, 340 Poles sought asylum in Canada. In 2005, the net migration rate was -0.49 migrants per 1,000 population. The government views the migration levels as satisfactory.
Before World War II, over 30% of the people living within the boundaries of Poland were non-Poles. As a result of World War II, and of the boundary changes and population transfers that followed, Poland today is a predominantly homogeneous state with only about 3% of the population being non-Polish. According to the most recent census (2002), Poles constitute about 98% of the total population. Germans make up 0.4%, Ukrainians account for 0.1%; and Belarussians, 0.1%. There are about 50,000 Lithuanians in the country. There is also a significant number of Roma.
Polish is one of the western Slavic languages using the Latin alphabet and the only major Slavic language to preserve the old Slavic nasal vowels. It is easily distinguishable from other Slavic languages by the frequent accumulation of consonants. In addition to the letters of the English alphabet, it has the following letters and diphthongs: a, ch, ci, cz, dź, dzi, e, l, ń, ni, ó, rz, ś, si, sz, z, ż, ź, and zi. It has no q, v, or x. Among the several dialects are Great Polish (spoken around Poznań), Kuyavian (around Inowroclaw), Little Polish (around Cracow), Silesian (around Katowice and Wroclaw), and Mazovian (around Warsaw and extending north and east). Some philologists consider that Kashubian, spoken along the Baltic, is not a Polish dialect but a separate language.
Many Poles speak English, French, German, or Russian, and understand other Slavic languages in varying degrees. By law, ethnic minorities have the right to be taught in their own language.
Poland has historically been one of the world's most strongly Roman Catholic countries. During the period of Communist domination that began in 1945, that church suffered extensive repression by the state. A change in party leadership in October 1956, however, brought about a new relationship between church and state, which included voluntary religious instruction in schools and other guarantees to the Roman Catholic Church. In 1974, the Polish government established permanent working contacts with the Holy See. The position of the Church was further enhanced when the archbishop of Cracow, Karol Cardinal Wojtyla, became Pope John Paul II in 1978. In 1989, the Roman Catholic Church was finally granted legal status and control of its schools, hospitals, and its university in Lublin. A concordat was signed with the Vatican in 1993 and ratified by parliament in 1998.
It is estimated that over 96% of Poles are nominally Roman Catholics. About 509,700 people, about 1.3% of the population, are registered members of the Eastern Orthodox Church, 82,000 are Greek Catholics, 124,294 are Jehovah's Witnesses, and 79,050 are Lutherans (Augsburg). Other established Christian denominations include Old Catholic Mariavits, Polish-Catholics, Pentecostals, Seventh-Day Adventists, Baptists, Methodists, the Church of Christ, Reformed Lutherans, Mormons, and the New Apostolic Church. About 109 people are registered members of Muslim associations; there are, however, many more Muslims in the country who are not officially registered with a group. About 895 people are registered Hare Krishnas. A 2001 poll indicated that only 58% of the entire population were active practitioners of their chosen faith.
On the eve of World War II, an estimated 3,351,000 Jews lived in Poland, more than in any other country; they constituted about 10% of the Polish population and nearly 20% of world Jewry. During the course of the Nazi occupation (1939–45), nearly 3,000,000 Polish Jews were killed, many of them in extermination camps such as Auschwitz (Oświecim), near Cracow. Most of the survivors had fled to the USSR; at the end of the war, only about 55,000 Jews remained in Poland. Repatriation raised the total Jewish population to 250,000 in 1946. However, the establishment of the State of Israel in 1948, combined with a series of anti-Semitic outbreaks in Poland (including a government-led campaign in 1968–69), induced most Jews to emigrate. As of 2003, Poland had only about 20,000–30,000 Jews living in the country.
In 2004, Poland's operational rail network totaled 23,852 km (14,835 mi) of broad and standard gauge rail lines, of which 11,962 km (7,440 mi) were electrified. Of all lines in use, standard gauge accounts for nearly all at 23,223 km (14,445 mi). In terms of line length the Polish State Railways (PKP) is the third-largest railway system in Europe. However, equipment and service is far behind EU countries. In 2000 PKP began privatization of passenger, cargo and infrastructure.
There is a dense road and highway network. Improvement and repair have not kept up with the increased usage—an 80% increase in freight and a 1,800% increase in passenger transport between 1950 and 1970, and a 60% increase in freight traffic and a 70% increase in passenger transport during 1971-82. In 2001 out of a total of 364,697 km (226,842 mi) of roadways, 249,088 km (154,932 mi) were paved roads, including 399 km (248 mi) of expressways. In 2003, there were 11,243,800 passenger cars and 2,274,600 commercial vehicles.
As of 2005, Poland had seven merchant ships of 1,000 GRT or more, totaling 154,710 GRT. Before World War II, Polish merchant marine operations were mainly with the Western countries, especially the United States, but much of the current traffic is with Asian and African countries. The major ports are Szczecin, Gdynia, Gdánsk, and Swinoujáscie. The ports were badly damaged during World War II but have since been rehabilitated and enlarged. As of 2003, there were 3,812 km (2,369 mi) of navigable rivers and canals. The principal inland waterways are the Oder, with Szczecin near its mouth, the Wista, and the Warta.
In 2004, Poland had an estimated 123 airports. As of 2005, a total of 84 had paved runways, and there were also two heliports. Polish Air Transport (Polskie Linie Lotnicze-LOT), organized in 1922 and reorganized after World War II, is a state enterprise, with Warsaw's Okecie International Airport as the center. In 2003, about 3.252 million passengers were carried on scheduled domestic and international airline flights.
The land now known as Poland was sparsely populated in prehistoric times. The oldest preserved settlements, most notably at Biskupin in northwest Poland, date back to 1000 bc. A lack of Roman conquest and settlement delayed early urbanization in relation to the territories of Western Europe such as Germany and France. Slavic tribes, from whom modern Poles are descendants in terms of language and culture, began settling Poland in the fourth and fifth centuries AD after the Hunnic invasions and mass migrations of peoples from Asia to Europe. By ad 800, the population was probably around one million and stabilized into permanent settlements. Rulers of the Piast dynasty united the Polish tribes of the Vistula and Oder basins about the middle of the 10th century. In 966, Mieszko I, a member of this dynasty, was baptized, and consequently Poland became a Christian nation. Thirty-three years later, his eldest son and successor, Boleslaw I "the Brave" (992–1025), whose military campaigns took him as far east as Kiev, secured recognition of Polish sovereignty and received a royal crown from Holy Roman Emperor Otto III, becoming the first king of Poland.
During the next three centuries, Poland was continually embroiled in conflicts with the Germans to the west and with the Eastern Slavs and Mongol invaders to the east, while developing cultural relations with Western civilizations. Foreign penetration and internal difficulties led to the division of Poland among members of the Piast dynasty. Under Casimir III "the Great" (1333–1370), the last of the Piast rulers, Poland was restored to unity and greatness. Casimir made peace with the Teutonic Knights, added Galicia to the realm, and welcomed Jewish refugees from the west; internally, law was codified, administration centralized, and a university was established in Kraków in 1364. In 1386, a Polish-Lithuanian federal union was created through a dynastic marriage, which also gave birth to the Jagiellonian dynasty, named for Jagiello, grand duke of Lithuania, who ruled Poland as Ladislas II (1386–1434). The union extended from the Baltic to the Black Sea and held control over other territories in Central Europe, notably West Prussia and Pomerania. The combined forces of the union annihilated the Teutonic Knights in 1410, in the Battle of Grunwald. The 16th century, known as Poland's Golden Age, saw the flourishing of the arts, scholarship, and architecture, most notable examples of which are the poetry of Jan Kochanowski, the revolutionary astronomical work of Nicolaus Copernicus, and the Renaissance architecture of old Kraków. During this time Poland was the largest state in Europe and a regional military power. In order to preserve the union during the reign of Sigismund II (1548–72), the last of the Jagiellonians, provisions were made for an elective monarch and a single parliament (Sejm) for Poland and Lithuania. The fact that kings were elected by the Polish/Lithuanian gentry (szlachta ) and the ratification of the first constitution in Europe in 1792 are often mentioned to support the claim that Poland is a pioneer of European democracy.
Unfortunately, many of the political reforms contributed to the nation's subsequent decline. The szlachta had progressively gained influence and power at the expense of the king. Meeting in the Sejm, the gentry adopted the legislative practice whereby a single dissenting voice was sufficient to block passage. Such policies prevented any decisive action by the government with the gentry cementing their position of power in an economy based on agricultural serfdom. The nobility imposed such far-reaching limitations upon the monarchy that national unity and integrity could not be maintained. Internal disorders, including the Cossack and peasant uprising (1648–49) led by Bogdan Chmielnicki against Polish domination of the Ukraine—a revolt that struck with particular ferocity against Polish Jews, many of whom had served as agents of the nobility in administering Ukrainian lands—further weakened the nation, as did the very destructive Swedish invasion in 1655–60. In 1683, Polish troops led by John III Sobieski (1674–96) rescued Vienna from a Turkish siege, but this was perhaps the last great military victory of an increasingly weakened and war-weary state.
The decline of Poland's power was taken advantage of by its neighboring states. A Russian, Prussian, and Austrian agreement led to the first partitioning of Poland in 1772; the second (1793) and third (1795) partitions led to the demise of Poland as a sovereign state. Galicia was ruled by Austria-Hungary, northwestern Poland by Prussia, and the Ukraine and eastern and central Poland by Russia, which extended its domains to include the Duchy of Warsaw, reconstituted as the Kingdom of Poland (under Russian imperial rule) at the Congress of Vienna in 1815. The Poles rebelled in 1830 and 1863 against the tsarist rulers, but each insurrection was suppressed. However, the peasants were emancipated by Prussia in 1823, by Austria in 1849, and by Russia in 1864. Galicia, which won partial autonomy from Austria following the Habsburg monarchy's constitutional reforms, became the cultural center of the Poles.
With the Russian Revolution of 1917 and the defeat of the Central Powers in World War I, Poland regained its independence. On 18 November 1918, Jozef Pilsudski, leader of the prewar antiRussian independence movement, formed a civilian government. Dispute over the eastern borders of the re-born state led to a military clash with the Soviet Union. The conflict, in which the Bolshevik hope of spreading socialist revolution beyond Poland to Germany and France was dashed by a fortuitous Polish counterattack near Warsaw, ended with the Treaty of Riga in 1921, under which Galicia was restored to Poland.
In the next two decades Poland was plagued by economic difficulties and political instability, and by increasingly menacing pressures from its Soviet and German neighbors. Following the Nazi-Soviet Pact in 1939, Germany invaded Poland on 1 September, occupying Warsaw four weeks later. Meanwhile, the USSR began occupation of the eastern half of the country on 17 September, despite nonaggression treaties Poland signed with both the USSR and Germany. Almost immediately Nazi forces began to brutally oppress large segments of the Polish population and loot Poland's industrial sector and major resources such as timber, coal, and wheat. Ghettos for Jews were set up in Warsaw and other cities, and numerous concentration camps were established on Polish territory, including the extermination camp at Auschwitz, where at least one million people perished between 1940 and 1944. Poland suffered tremendous losses in life and property during World War II. An estimated six million Poles were killed, half of them Jews; 2.5 million were deported for compulsory labor in Germany; more than 500,000 were permanently crippled; and the remaining population suffered virtual starvation throughout the Nazi occupation. Losses in property were evaluated at z258 billion (more than us$50 billion).
The seeds of Poland's postwar political history were sown long before the war ended. A Polish government-in-exile was set up in France and later in the United Kingdom. Units of the Polish army fought together with the Allies while in Poland underground groups, organized along political lines, maintained resistance activities. The Home Army (Armia Krajowa ) was the major nonCommunist resistance group and took its orders from the government-in-exile in London. Although formally allied to the Soviet Union, relations between Moscow and the London-based Polish government continued to deteriorate, especially after the discovery of mass graves of thousands of Polish officers murdered by the Soviets in 1940. In July 1944, the Polish National Council, a Soviet-backed resistance group, set up the Polish Committee of National Liberation as a provisional government in liberated Lublin, declaring the émigré Polish government illegal. In August 1944 the Home Army in Warsaw rose against the Nazis in hopes of liberating the capital in step with the Soviet military advance. In the events that followed and still breed controversy to this day, the Red Army halted its advance and allowed the Nazis to use their remaining forces to brutally suppress the rising and completely destroy the city. It was only on 17 January 1945 that the Red Army entered Warsaw and installed the provisional pro-Soviet government. At Yalta, the Allies agreed to accept the Curzon line, thereby awarding the USSR nearly half of former Polish territory (including Galicia) in return for a Soviet agreement to broaden the political base of the provisional government with the addition of non-Communist Polish leaders. After subsequent negotiations, the Provisional Government of National Unity was formally recognized by the United States and Britain in July 1945.
Despite Stalin's promises of free elections, a bloc of four parties dominated by the Communists emerged victorious in the elections of January 1947. The Communists and the Socialists merged in December 1948 to form the Polish United Workers' Party (PZPR). The PZPR consistently followed a pro-Soviet policy. Domestically, the party pursued a reconstruction program stressing agriculture and industrial development. It shunned the Marshall Plan and, in its first two decades, renounced all dealings with the Western powers.
The first decade of Communist rule was dominated by Stalinist repressions, tensions with the Roman Catholic Church, and a strong-handed Soviet influence, as practiced by Konstantin Rokossovsky, a Soviet general of Polish birth, who became Poland's defense minister in 1949 and served as deputy prime minister from 1952 until his resignation four years later. Rising nationalist sentiment, heightened by stagnating economic conditions, led to worker riots in Poznan on 28–29 July 1956. In response to the unrest, a new Polish Politburo, headed by Wladyslaw Gomulka (who had been purged from the PZPR in 1949 and subsequently imprisoned because of his nationalist leanings), introduced liberalizations, including the abolition of farm collectivization, and improved relations with the Church. Conditions improved from those immediately after the war, but by the late 1950s, the reform movement had been halted, and the government took a harder line against dissent. In 1968 there were student demonstrations against the government in the university centers; the Gomulka regime countered with a political offensive in which many government officials and party members accused of anti-Socialist or proZionist sentiments were removed from office, and an estimated 12,000 Polish Jews left Poland.
Two years later, following a drought in 1969 and an exceptionally severe winter, demonstrations by shipyard workers in Gdańsk broke out on 16 December 1970 to protest economic conditions, the privileges of the Communist party elite, and an announced rise in food prices. The government responded with military force and after widespread violence, with soldiers firing on striking workers, at least 44 people were killed. The unrest led to the removal from power of Gomulka and the installation of Edward Gierek as the first secretary of the politburo on December 20. Under continued pressure from strikes, Gierek's government postponed the controversial incentive system and froze prices at their new levels. After receiving a substantial long-term Soviet grant (estimated at $100 million), the Polish government rolled back prices to their pre-December 1970 levels, and labor peace was restored. In a move to bolster his support, Gierek reinstated Church control over thousands of religious properties in northwestern Poland to which the government had held title since 1945.
During the 1970s, Gierek's government vigorously pursued a policy of détente with the West. Three US presidents visited Poland and Gierek himself traveled to the United States and to several West European countries. Peace agreements governing the Oder-Neisse line and formally recognizing Polish sovereignty in former German territories were concluded with West Germany, and trade pacts were signed with the United States, Britain, France, Italy, Austria, and other nations. With a bold plan of creating a "second Japan," Gierek secured huge loans (several billion dollars) from the West in hopes of building an industrial export economy and improving living conditions, which were at this point glaringly inferior to those in the capitalist world. Although many ambitious projects were undertaken, including the building of an oil refinery in Gdańsk and a new steel works plant in Katowice, mismanagement and the inefficiency of the socialist economy crippled real economic output and the prospects of repaying the foreign debts became increasingly dim. In 1976, the government announced food price increases but had to rescind them after the workers responded by striking. During the next several years, the economic situation kept deteriorating, and Polish nationalism, buoyed in 1978 by the election of the archbishop of Kraków to the papacy as John Paul II, continued to rise. In July 1980, new meat price increases were announced, and within a few weeks, well-organized workers all over Poland demanded a series of economic and political concessions, including the right to organize independent trade unions outside of the Communist party. The center of labor activity was the Lenin Shipyard in Gdańsk, where in a public ceremony on 31 August, government officials agreed to allow workers the right to organize and to strike. The independent labor movement Solidarity, headed by Lech Walesa, the leader of the Gdańsk workers, and strongly supported by the Roman Catholic clergy, soon claimed a membership of about 10 million (about a fourth of the population), with its ranks filled not only with workers but also intellectuals. That month, Stanislaw Kania replaced Gierek as first secretary.
For more than a year, the government and Solidarity leaders negotiated, with Catholic Church officials often acting as mediators. As Solidarity became more and more overtly political—demanding, for example, free parliamentary elections—Poland's Communist leaders came under increasing pressure from the USSR to stop the "anti-Socialist" and "anti-Soviet" forces. On 18 October 1981, Gen. Wojciech Jaruzelski, prime minister since February, replaced Kania as first secretary. On 13 December, after union leaders in Gdańsk called for a national referendum on forming a nonCommunist government in Poland, Jaruzelski set up the Military Council for National Salvation and declared martial law. To what extent Jaruzelski's abrupt crackdown was carried out to prevent direct Soviet military intervention is still unclear, although evidence suggests that the Kremlin had not drawn up any plans for a military intrusion into Poland. Almost the whole leadership of Solidarity, including Walesa, was arrested, and the union was suspended. Despite further strikes and rioting, which resulted in several deaths, the military had soon gained complete control. More than 10,000 people were arrested and detained for up to 12 months, and all rights and freedoms gained in the preceding year and a half were abolished. In January 1982, the United States imposed sanctions against Poland, including withdrawal of most-favored-nation status, veto of Poland's entry into the IMF, and suspension of fishing rights in US waters and of LOT flights to the United States. Protests and rioting continued sporadically into 1983, and some Solidarity leaders remained active underground, but these disturbances did not seriously threaten the military regime. On 22 July 1983, the government formally ended martial law and proclaimed an amnesty, but a series of legislative measures had meanwhile institutionalized many of the powers the government had exercised, including the power to dissolve organizations, forbid public meetings, and run the universities.
The internal political situation stabilized to such a degree that in July 1984 the government proclaimed a general amnesty, and the United States began to lift its sanctions the following month (the last sanctions were lifted in early 1987). When an outspoken priest, Father Jerzy Popieluszko, was kidnapped and subsequently murdered by two secret police officers, the government, in an unprecedented step, permitted a trial to take place in February 1985 in the result of which four security officers were convicted and sentenced. Another amnesty was proclaimed in September 1986, leading to the release of all remaining political prisoners. Economically, however, the country was spiraling out of control. Continued declines in standards of living and shortages of even basic necessities led to waves of strikes throughout Poland in spring and fall 1988, essentially paralyzing the nation. By November 1987 public antipathy had been so widespread that the government called for the first public referendum to be held in Poland in more than 40 years; this was also the first open election to be held within the Warsaw Pact. Although the ballot itself asked only for public support of an accelerated economic reform package, the people of Poland understood the referendum to be a vote of confidence in the government itself. The final tally was approximately two-thirds in support of the government, but because of a Solidarity-inspired voter boycott, only 67% of the eligible voters cast their ballots, which meant that the referendum failed to pass, a first-ever defeat for the government.
In autumn 1988, the entire government resigned and it became clear that talks with labor activists were inevitable. The negotiations leading up to the so-called "round-table talks," which finally opened in February 1989, were as delicate and prolonged as the talks themselves. However, in April 1989 agreement was reached on a number of unprecedented concessions: Solidarity was recognized as a legal entity; the post of president was created, to be filled by legislative appointment; some independent media were permitted to operate; and the Catholic Church was given full legal status. In June 1989 came perhaps the most far-reaching change, the establishment of a senate, complementing the existing Sejm, with the seats to be filled by open election. In addition, 35% of the seats in the Sejm were also made subject to direct election.
The government did all it could to make it difficult for opposition candidates to run: only two months were allowed in which candidates could gather the petitions necessary to get on the ballot, and the ballots themselves listed candidates alphabetically, with no indication of party affiliation. Despite those efforts, Solidarity won a decisive victory; 99 of the 100 seats in the Senate went to Solidarity members. Moreover, many government candidates in the Sejm lost seats because voters crossed out the names of unopposed government candidates, thus denying them the necessary 50% of the total votes cast.
In June 1989, the newly elected parliament named General Wojciech Jaruzelski Poland's president by the slenderest of margins. Two months later, Solidarity pressed to balance Jaruzelski's post of president with a non-Communist prime minister and at this point the discredited PZPR could do little but comply. Although it was widely expected that Lech Walesa might lead the first Solidarity government, he demurred, instead putting forward Tadeusz Mazowiecki, who took office on 24 August 1989, as the first non-Communist prime minister in the Eastern Bloc. That autumn, motivated at least in part by the events unfolding in Poland, a wave of "velvet revolutions" spread across Eastern Europe culminating in the fall of the Berlin Wall. These events further accelerated the de-Sovietization of Polish government. In September 1990, Jaruzelski resigned, opening the way for new elections.
The election of Walesa as president was the formal end to Poland's Communist rule, with Poland rejoining the community of democratic nations. In what would become known as "shock therapy," the previously Socialist economy was abruptly opened to free market forces. Although initially inflation sky-rocketed and economic output continued to fall, by 1997 Poland was attracting large amounts of foreign investment and enjoying the highest growth rates in Europe. At the same time, not everyone enjoyed economic prosperity and political discord continued to grow. The number of political parties ballooned, making it difficult to undertake such complex and contentious issues as large-scale privatization, economic rationalization of Soviet-era giant industry, and fundamental constitutional revision. The October 1991 election saw 69 parties competing, with 29 actually winning seats, none of them with more than 14% of the vote. Inevitably, this resulted in coalition governments without clear mandates, giving Poland five prime ministers and four governments in 1991–93. This proliferation of parties reflected disparities among the electorate that emerged once the Communists had been removed as a unifying focus for opposition.
In the September 1993 election, the two most popular parties, the Polish Peasant Party (PSL) and the Democratic Left Alliance (SLD) were made up largely of ex-Communists or other figures from the governments of the past. The apparent rejection of the gains of Solidarity and the return of the vanquished ex-Communists was variously interpreted as a rejection of "shock-therapy" economic transformation, the electorate's nostalgia for the more ordered life of the past, and a vote against the Catholic Church, or at least its social agenda of asserting close control on social issues such as abortion, school curriculum, and women's role in society.
Fears associated with the return of the many ex-Communists to power proved unfounded. Although differing from their predecessors on the pace of Poland's economic transformation, the government of Polish Peasant Party (PSL) leader Waldemar Pawlak, and his Democratic Left Alliance (SLD) partner, Aleksander Kwasniewski, remained generally committed to Poland's course of democratization and economic transition. The Constitution Commission proposed a new constitution that passed the National Assembly in April 1997, and was approved in a national referendum on 23 May 1997.
The parliamentary elections of 1997 saw the return to power of centrist and right of center Solidarity legacy parties, with Solidarity Electoral Action (AWS) and the Freedom Union (UW) forming a coalition with Jerzy Buzek as prime minister. The Buzek government presided over many successful reforms, including reorganization of local and regional administration, but an economic downturn and rising unemployment caused the voters to resoundingly return the reigns of power to the post-Communist SLD in 2001.
In 2005 the power pendulum swung again to the right with the scandal ridden SLD achieving less than 12% of the vote and the right of center Law and Justice (PiS) and centrist Civic Platform (PO) gaining the majority. The constant and almost predictable shift of power can be interpreted as a political maturation of the young democracy or as the failure of either side to address the main economic issue of unemployment, which reached its maximum level of 20% in December 2004. The exception to the changing political tides has been the reformed Communist Aleksander Kwasniewski of the SLD, who beat Walesa to be elected president in 1995 and won a second term in 2000.
It has been on the international scene that Poland has made its most visible strides since the end of Communist rule. In 1997, NATO invited Poland, along with the Czech Republic and Hungary, to join the alliance, and the three countries became members in March 1999. In May 2004 Poland became a member of the European Union (EU) and is now the organization's sixth most populous member. Poland asserted itself as a close American ally by being one of the few countries to participate in the 2003 invasion of Iraq and subsequently administering an Iraqi occupied zone with the initial involvement of 2,400 of its own troops. Poland has also attempted to play a leading role in the politics of eastern and central Europe and has invested its political capital in encouraging democratization in Belarus and supporting the Orange Revolution in the Ukraine in December 2004.
Since joining the EU, investment and economic growth picked up, with new manufacturing jobs coming from Western Europe. However, corruption, inefficient bureaucracy and weak infrastructure continued to be problems and slowed economic growth. Unemployment began to drop, but at 17.9% it still remained the highest in the European Union.
Until 1997, the form of government in Poland was in the midst of a protracted transformation, which left a number of its important features unclear. Without a formal constitution, Poland had been functioning on a much-amended form of its Communist-era constitution. The most important modifications were the Jaruzelski government's concessions of April 1989, which created both the Senate and the office of president, and a package of amendments passed in October 1992 which are collectively called the "Little Constitution." Another important modification was the agreement of 1990, which made the presidency a popularly elected post, rather than parliamentary appointment.
The president is directly elected, for a term of five years. The post has traditional executive obligations and powers, such as the duty to sign into law or veto legislations, but also retains substantial legislative powers, including the right to introduce bills and draft legal amendments.
During his tenure, Lech Walesa fought to widen the powers of the presidency, arguing that at least during the transition period Poland required a strong president able to resolve impasses and disputes on the basis of "practical experience," rather than on points of legal niceties.
Walesa's successor, Aleksander Kwasniewski, succeeded in putting forth a new constitution in 1997.
The parliament consists of two houses, the Sejm, or lower house, with 460 seats, and the Senate, with 100 seats. The members of both houses serve four-year terms. Seats are filled on the basis of party lists; there is a minimum national vote threshold of 5% for parties, or 8% for coalitions, with the votes for parties which fail to reach those minimums assigned to victorious parties. The prime minister proposes, the president appoints, and the Sejm approves the Council of Ministers or cabinet. The president, who is elected by popular vote for a five-year term, appoints the prime minister, who is then confirmed by the Sejm.
After the political poverty of its Communist past, Poland initially saw a proliferation of political parties ranging across the full political spectrum, from the rabidly xenophobic nationalism of the Polish National Front (whose leader, Janusz Bryczkowski, invited Russian extremist Vladimir Zhirinovsky to Poland in 1994) to the socialist party, Union of Labor (UP). In between were special interest and even quirky parties, of which the best example may be the Polish Beerdrinkers' Party. Overall, 69 parties participated in the 1991 parliamentary elections, of which 29 gained seats, none with more than 14% of the total vote. By 1993, however, the political scene was stabilizing. Only 35 parties participated in that election; perhaps more significantly, only five received seats.
The local elections of 1994 showed the emergence of three basic political orientations shaped by shifting coalitions of parties, with the parties themselves often dissolving and reorganizing under new names. The Polish political spectrum slightly deviates from the traditional notions of right and left in part because in contrast to most countries where labor movements are associated with the political left, the Polish right has its roots in the Solidarity labor movement.
The Polish far right was initially represented by several coalitions: the Alliance for Poland, which included the Christian National Union, the Center Alliance, the Movement for the Republic, Peasant Alliance, and the Conservative Coalition, and the 11 November Agreement, which included the Conservative Party, the Party of Christian Democrats, the Christian-Peasant Alliance, and the Real Politics Union (a radical laissez-faire party). These parties generally favored a major role for the Catholic Church, and tended to draw their support from Poland's rural sectors; in 1994, they did best in the eastern districts. The religious right is represented by the League of Polish Families (LPR), which has a social platform based on traditional Catholic values and was not in favor of Polish membership in the EU. LPR won 7.97% of the vote in the October 2005 elections.
The mainstream right was represented in the years 1997-2001 by Elective Action Solidarity (AWS). AWS led the government in coalition with UW. However, after a resounding defeat in 2001 AWS dissolved and its members eventually migrated to either the centrist Civic Platform (PO) or the right of center Law and Justice (PiS). PiS supports continuous but careful economic reforms, is in favor of raising retirement benefits, and remains socially conservative, as evidenced by the prohibition of a gay pride parade in Warsaw by its leader Lech Kaczynski in 2005. Another important aspect of the PiS is a strong stand against corruption. In the recent parliamentary elections in October 2005 PiS was the most popular party with 26.99% of the vote.
The center was dominated by Freedom Union (UW), which was formed in April 1994, when the Liberal Democratic Congress merged with the Democratic Union. The centrist position derives largely from the intellectual wing of the original Solidarity, favoring radical economic transformation, while being less concerned with immediate impact upon workers. UW formed a coalition with AWS as the junior partner in 1997–2000. UW's most prominent member was Leszek Balcerowicz, the architect of the "shock therapy" economic reform and president of Poland's National Bank. After the elections of 1997 UW largely dissolved, with its members joining the newly formed Civic Platform (PO), which also absorbed politicians from AWS. Both the UW and PO draw much of their support from smaller cities and university centers, such as Kraków, and the prosperous regions of western Poland. In the last parliamentary election in October 2005, PO's platform included a proposal for a 15% flat tax. PO was the second most popular party with 24.14% and was set to rule in a coalition with PiS.
The left, which was almost entirely discredited in 1991, has shown remarkable resilience. Through the 1990s, the two major parties were the Democratic Left Alliance (SLD) and the Polish Peasant Party (PSL), both descendents of elements of the old Communist party and its affiliates. The far left (some would argue far-right) is dominated by Self-Defense (SO) headed by Andrzej Lepper. Lepper's party is in favor of protectionist agriculture and sometimes anti-western isolationist foreign policy. In 2001 the Democratic Left Alliance (SLD) in coalition with the Labor Union (UP), a minor left-wing party, won a decisive victory and formed a government under Leszek Miller. Although Miller's government presided over Poland's entry into the European Union, it became increasingly unpopular due to a series of scandals involving corruption and bribery, and failure to accelerate economic growth. With Miller himself forced to resign amid scandal in May 2005, SLD continued to rule as a minority government under Marek Belka until the elections in October 2005. Unhappy with Miller's leadership of the party, many members withdrew from SLD in 2004 and formed a new leftist party called Polish Social Democracy (SDPL). In the October 2005 elections SLD won 11.31%, SO 11.41% and PSL 6.96%. SDPL failed to make the 3% threshold to enter the parliament.
In addition to the major parties, a German Minority Party is active with most of its support from the Opole region in southwest Poland.
In the 1995 presidential elections, Aleksander Kwasniewski of SLD beat Lech Walesa by a small margin (51.7% to 48.3%) to become president for a five-year term. He was reelected in 2000 with 53.9% of the vote to nonparty candidate Andrzej Olechowski's 17.3% and AWS chairman Marian Krzaklewski's 15.6%. In a striking reversal, Walesa finished seventh with 0.8% of the vote.
Constitutionally limited to only two terms, Kwasniewski did not run again in 2005. The October presidential elections saw 14 candidates compete. In the first round the top five contenders were Donald Tusk (PO) with 36.33% of the vote, Lech Kaczynski (PiS) with 33.10%, Andrzej Lepper (SO) with 15.11%, and Marek Borowski (SDPL) with 10.33%. The SDL candidate withdrew from the election due to a scandal. In the second round, which included only the top two candidates, Tusk and Kaczynski, Kaczynski won with 54.04% of the vote to Tusk's 45.96%. Kaczynski's term as president extended to 2010.
Poland had been divided into 49 administrative districts, or voivodships, which were the basic administrative units under the Communists. In 1989 Solidarity government replaced that system with one in which the basic unit was the gmina, or local authority, which owned property and had responsibility for its own budget. The gmina elected a council, which appointed the executive officials actually responsible for day-to-day administration of the locality.
In 1994, there were 2,383 such local councils, with a mixed system of election. In districts containing more than 40,000 people, of which there were 110 in 1994, council representation was proportionally determined, based upon party affiliation. In the smaller districts, council representatives were elected by direct majority vote.
Originally these gmina councils were similar in makeup to the Solidarity Citizens Committees, from which they originated. Increasingly, however, the councils differentiated themselves, some becoming controlled by national parties, others remaining dominated by personalities who responded primarily to local issues.
Changes in local government structure were introduced in 1999, transforming Poland's 49 provinces into 16 new ones. A three-tier division of government was established: municipalities/communes, 308 counties (powiaty ), and 16 provinces (wojewodztwa ). Each of these divisions is governed by a council. Council members are directly elected, and appoint and dismiss the heads of the municipalities/communes (wojt ), the town mayors, the starosta or head of the county, and the speaker of the provincial councils.
There is a four-tiered court system in Poland: regional, provincial, appellate divisions, and a Supreme Court. The Supreme Court, the highest judicial organ, functions primarily as a court of appeal. The Supreme Court and lower courts are divided into criminal, civil, military, labor, and family chambers. Judges are nominated by the National Judicial Council and are appointed by the president for life.
There is also a Constitutional Tribunal which offers opinions on legislation and exercises authority of judicial review. Constitutional Tribunal judges are appointed to nine-year terms by the Sejm.
Defendants enjoy a presumption of innocence and have the right to appeal. Although the judiciary is independent, it suffers from inefficiency, lack of resources and lack of public confidence.
Polish armed forces numbered 141,500 active personnel in 2005, with reservists numbering 234,000. Army personnel numbered an estimated 89,000 members, equipped with 947 main battle tanks, 435 reconnaissance vehicles, 1,281 armored infantry fighting vehicles, 33 armored personnel carriers, and 1,482 artillery pieces. The army's aviation arm included 65 attack and 80 support helicopters. Naval manpower in 2005 totaled 12,300, including 2,000 naval aviation personnel. Equipment included three tactical submarines, one destroyer, three frigates, four corvettes, 19 patrol/coastal vessels, and 22 mine warfare vessels. The naval aviation wing was supplied with 18 combat capable aircraft and a total of 30 helicopters for use in search and rescue, antisubmarine warfare and for support missions. The air force had 30,000 active personnel and 142 combat capable aircraft, including 28 fighter and 53 fighter ground attack aircraft, as well as 53 transport and 220 training aircraft. Poland also had a paramilitary force of 21,400 personnel, of which 14,100 were border guards and 7,300 police. Poland provided troops and observers to 13 different nations or regions as part of UN, NATO or European Union missions. The defense budget in 2005 amounted to $5.16 billion.
Poland is a charter member of the United Nations, having signed on 24 October 1945; it participates in ECE and several nonregional specialized agencies, such as the FAO, IAEA, the World Bank, UNESCO, UNIDO, and the WHO. Poland was admitted to NATO on 12 March 1999. The nation is also a member of the Council of Europe, the Council of the Baltic Sea States, the EuroAtlantic Partnership Council, the European Bank for Reconstruction and Development, the OECD, and the OSCE. Poland became a member of the European Union in 2004. The country has observer status in the OAS.
Polish troops have supported UN missions and operations in Kosovo (est. 1999), Lebanon (est. 1978), Western Sahara (est. 1991), Ethiopia and Eritrea (est. 2000), Liberia (est. 2003), Georgia (est., 1993), and the DROC (est. 1999), among others. In 2003, Poland assumed command of division of multinational forces working on peacekeeping and stabilization efforts in Iraq.
Poland is part of the Australia Group, the Zangger Committee, the European Organization for Nuclear Research (CERN), the Nuclear Suppliers Group (London Group), and the Organization for the Prohibition of Chemical Weapons. In environmental cooperation, Poland is part of the Antarctic Treaty, the Basel Convention, Conventions on Biological Diversity and Air Pollution, Ramsar, CITES, the London Convention, the Kyoto Protocol, the Montréal Protocol, MARPOL, the Nuclear Test Ban Treaty, and the UN Conventions on the Law of the Sea, Climate Change and Desertification.
Until 1990, Poland had a centrally planned economy that was primarily state controlled. Agriculture, however, was only partly socialized, with state farms and cooperatives accounting for 23% of the country's total farmland in 1984. Since World War II, agriculture's predominance in the economy has been waning; in 1990, it accounted for 16.2% of the NMP, compared to 22.7% in 1970. In 2004, its contribution to GDP was an estimated 2.9%, although it continued to employ about 24% of the labor force. Poland, with its sizable coastline, has become a maritime nation of some note, having developed three major ports on the Baltic and a greatly expanded shipbuilding industry, which in 1991 produced 53 ships. In 2003, yearly production was reported as 50 ships, about one-tenth of the number of ships produced by South Korea and Japan, the industry leaders. However, in June 2002 the Szczecin Shipyards, considered an example of successful privatization, declared bankruptcy. Poland has rich coal deposits, but it lacks some important natural resources, such as petroleum and iron ore.
During 1971–75, Poland's NMP increased by about 12.8% annually; the growth was, to a substantial degree, the result of loans from the West. After 1975, however, Poland's economic performance deteriorated because of excessive investments, internal market problems, several bad harvests, the worldwide recession, and the political upheaval of 1980–81. An economic growth rate of 2.5% annually during 1976–78 was followed by declines of 2% in 1979, 4% in 1980, 12% in 1981, and 5.5% in 1982, while the debt to Western governments reached nearly $25 billion by 1983, rising to $33 billion in 1991, when the total hard-currency debt reached $52.5 billion. During 1980–91, the GNP grew at an annual average rate of only 1.2%. Inflation averaged 54.3% annually in the 1980s.
With Poland subjected to the "shock therapy" of a transition to a market economy, GDP fell 31.5% from 1990–92 and consumer prices shot up almost sixfold. However, the economy did not stay down long and it soon became one of the most robust in Eastern and Central Europe thanks to the government's tight fiscal and monetary policies. The economy grew by just under 7% in 1995, and by 5.5% in 1996 and 1997, for an average of over 5% a year 1994 to 1997. Most of the growth since 1991 came from the booming private sector, by 1997 accounting for about 70% of GDP (up from 50% in 1992), due in large part to the creation of new private firms. Poland's pace of growth declined after 1998, as the economy was impacted by the Russian financial crisis and then the global economic slowdown in 2001. In 1998, growth fell to 4.8%; in 1999, 4.1%; in 2000, to 4%; and in 2001, to 1%. Signs of economic recovery began to be seen in 2003. In 2002 GDP grew at 1.4%, but in 2003 at 3.8% and reached an impressive 5.3% in 2004, when Poland joined the EU. Similarly, inflation shot up to 10.1% in 2000 with the recovery of oil prices, but in 2001 moderated to 5.5%. In 2002 inflation was only 1.9%, in 2003 0.8%, in 2004 3.6% and in 2005 3.2%. The growth of the economy was accompanied by privatization. About 72% of the economy had been privatized by 2002, and the government has continued to privatize state-owned industries in recent years by successfully utilizing the Warsaw Stock Exchange to this end. The goal is to achieve the ownership structure similar to that of other EU member states, where private ownership is close to 80%.
The major problems facing the economy are unemployment and persistently high fiscal deficits. Unemployment increased to 13% in 1999, to 15% in 2000, to 16% in 2001, to 17% reaching 20% in 2002, before it started to fall again, to 19% in 2004 and 17.3% in 2005. On 7 June 2003, 75% in a vote with a 57.34% turnout (above the 50% minimum turnout required) voted "yes" to the referendum of Poland's joining the EU. Poland became a member of the EU on 1 May 2004. Economists estimate that it will take decades for per capita average income in Poland, which was about $4,800 in 2002 ($9,500 in purchasing power parity terms), to reach the EU average. In 2004 per capita average grew to $12,000.
The US Central Intelligence Agency (CIA) reports that in 2005 Poland's gross domestic product (GDP) was estimated at $489.3 billion. The CIA defines GDP as the value of all final goods and services produced within a nation in a given year and computed on the basis of purchasing power parity (PPP) rather than value as measured on the basis of the rate of exchange based on current dollars. The per capita GDP was estimated at $12,700. The annual growth rate of GDP was estimated at 3.3%. The average inflation rate in 2005 was 2.1%. It was estimated that agriculture accounted for 2.8% of GDP, industry 31.7%, and services 65.5%.
According to the World Bank, in 2003 remittances from citizens working abroad totaled $2.314 billion or about $61 per capita and accounted for approximately 1.1% of GDP. Foreign aid receipts amounted to $1.2 trillion or about $31 per capita and accounted for approximately 0.6% of the gross national income (GNI).
The World Bank reports that in 2003 household consumption in Poland totaled $136.49 billion or about $3,573 per capita based on a GDP of $209.6 billion, measured in current dollars rather than PPP. Household consumption includes expenditures of individuals, households, and nongovernmental organizations on goods and services, excluding purchases of dwellings. It was estimated that for the period 1990 to 2003 household consumption grew at an average annual rate of 4.7%. In 2001 it was estimated that approximately 28% of household consumption was spent on food, 19% on fuel, 6% on health care, and 1% on education. It was estimated that in 2003 about 17% of the population had incomes below the poverty line.
The labor force in 2005 totaled an estimated 17.1 million persons. As of 2003, agriculture accounted for 18.4% of the workforce, with industry at 28.6% and 53% in the services sector. In 2005, the estimated unemployment rate was 18.3%, with considerable underemployment as well.
Unions have the right to strike and bargain collectively, although union officials report that workers in the private sector are encouraged not to join unions by their employers and workers organizing unions often face discrimination. According to press reports, 17% of Poland's workforce was unionized.
The labor code prohibits employment for children under the age of 15. There are strict rules governing the work standards for those between 15 and 18 years old, however these are not regularly enforced. The minimum wage in state-owned enterprises was around $300 per month as of 1 January 2006. However, a large number of construction and seasonal agricultural workers earn less than the minimum wage. The legal standard workweek is 40 hours with 35 hours of uninterrupted rest per week. Overtime is subject to premium pay rates. The labor code defines occupational safety and health standards but they are not consistently enforced.
In 2003, agriculture engaged 18.4% of the Polish labor force (as compared with 53.5% in 1948 and 39.9% in 1967). About 62% of Poland's land is agricultural; of this area, 78% is cultivated. Overall agricultural output during 1980–90 fell by nearly 0.4% annually. Between 1990 and 2000, agricultural production dropped by 0.2% annually. Crop output was valued at nearly €5.76 billion in 2003. During 2002–04, crop output was down 8.5% compared with 1999–2001. In 2005, agriculture accounted for 5% of GDP, down from 14.5% in 1985.
The transition from an agricultural economy is due partly to territorial changes resulting from World War II (1939–45); largely agricultural areas were transferred to the USSR, whereas the areas acquired in the west were predominantly industrial. During the war, approximately one-third of the Polish farms were completely or partly laid waste, and five-sixths of the hogs and two-thirds of the cattle and sheep were destroyed, leaving farmers almost without draft animals and fertilizer. At the same time, population transfers delayed cultivation in the areas of resettlement.
Land redistribution followed both world wars but was much more extensive after World War II. A 1944 decree expropriated all holdings larger than 100 hectares (247 acres); land belonging to Germans or collaborators was also expropriated. Attempts at collectivization were generally resisted; after 1956, most collective farms were disbanded and their land redistributed. During the 1990s, about 3.7 million Poles were engaged in small plot farming (with an average farm size of 6 hectares/15 acres) on 2.1 million private farms, which produced about 75% of agricultural output. In 2003, Poland had over 2,172,000 agricultural holdings and the largest number of full-time agricultural employment in the 25-nation EU, at over 1,048,000 workers, and another 3,248,000 part-time agricultural workers that year.
In 2004, principal crops and their estimated yields (in thousands of tons) were potatoes, 13,746; sugar beets, 11,471; wheat, 9,450; rye, 4,129; barley, 3,476; triticale, 3,349 (highest in the world); and oats, 1,462. Yields have been poor because of infertile soil, insufficient use of fertilizers, and inadequate mechanization, in addition to the drought. There were 1,310,500 tractors in 1997, up from 620,724 during 1979–81. Although grain production has been Poland's traditional agricultural pursuit, since World War II, Poland has become an importer—instead of an exporter—of grains, particularly wheat.
Poland grows an assortment of fruits and vegetables. Fruit and berry yields (in thousands of tons) for 2004 included: apples, 2,500; currants, 192; strawberries, 185; raspberries, 42; plums, 119; and pears, 77. Field vegetable production in 2004 (in thousands of tons) included: cabbage, 1,370; carrots, 928; onions, 866; cucumbers, 256; cauliflower, 206; and tomatoes, 213.
Pastures covered about 10.7% of the total land area in 2003. The government has encouraged the development of livestock production through increased fodder supply and improvement in breeding stock and partial tax relief for hog raising. Emphasis has been placed on the raising of hogs and sheep. In 2005, there were 18.1 million pigs, 5,483,000 head of cattle, and 316,000 sheep. In 2005 there were an estimated 90 million chickens, 5 million ducks, 3 million geese, and 600,000 turkeys.
Estimated livestock production in 2005 included (in thousands of tons): pork, 1,923; beef and veal, 304; poultry, 984; mutton, 1.6; and milk, 11,401. Butter production in 2005 was 190,000 tons; cheese, 595,000; and honey, 12,500.
Most of the fishing industry has been brought under state ownership. Sea fishing is conducted in the Baltic and North seas and in the Atlantic (Labrador, Newfoundland, and African waters), and there are inland fisheries in lakes, ponds, and rivers. The 2003 saltwater catch was 160,260 tons, predominantly sprat, herring, and cod; freshwater fishing yielded about 54,520 tons. Aquaculture in 2003 produced 54,000 tons. Exports of fish products amounted to $313.2 million in 2003, with processed and preserved fish and caviar accounting for $100 million.
As of 2003, 28.4% of Poland's land was forested. Pine, larch, spruce, and fir are the most important varieties of trees. Polish forests are subject to difficult growing conditions such as wide temperature fluctuations in winter, hurricane strength winds, and unusually high temperatures in summer. Most Polish forests grow on highly degraded sandy soils that hold little moisture. Moreover, much of Poland suffered from drought during the 1990s. Almost 50% of forests are young trees; only 17% of the stand can be cut. The Wielkopolski National Forest, a reservation in Rogalin, is famous for its thousand-year-old oak trees.
Despite the adversity, the forest products industry was one of the most rapidly growing sectors of the Polish economy in the 1990s. Since 1992, output of value-added products has doubled, excluding sawn timber. Wood processing occurs in the Biala Podlaska region, while large areas of forest in the Zamosc region foster development in the furniture industry. In 2004, exports of furniture were valued at $3.4 billion (mainly to Germany), making it a leading export commodity. In 2004, over 80% of furniture production was exported, compared to 17% in 1989. The timber cut in 2004 was estimated at 28 million cu m (1 billion cu ft) of roundwood. The annual allowable cut is typically around 28.7 million cu m (1.01 billion cu ft), equivalent to 33% of annual growth. Poland was once an exporter of timber, but given the booming construction of private homes, domestic production does not meet local demand. In 2004, imports of forestry products exceeded exports by $233.2 million.
The government has been attempting to offset losses from territorial redistribution and wartime destruction by afforestation. During 1990–2000, the forested area increased in size by an annual average of 18,000 hectares (44,500 acres) per year. Although land is being returned to forests, industrial pollution and pests are still causing deterioration. As of 2004, 31% of commercial forests were plantation or regrowth forests.
Poland ranked third globally in mined zinc, sixth in silver, seventh in coal and sulfur (a major export commodity), among the top ten in mine copper (3% of world output, and second in Europe and Central Eurasia), and was a leading producer in Central Eurasia and Europe of lead, lime, nitrogen, and salt. Poland had 9% of world sulfur reserves, about 6% of world copper ore reserves, and had significant resources of bituminous coal, salt, silver, and lead and zinc ores. The mining and quarrying sector, which included mineral fuels and processing, accounted for around 2% of Poland's gross domestic product (GDP) in 2002, which grew by 2.3% in that year from 2001. Total sales by the mining and quarrying sector contracted by 3% in 2002, with sales by the coal, lignite and peat mining industries falling by 5.8% in that same year.
Mine output of metals in 2002 included: mined zinc, 171,200 metric tons, down from 172,300 in 2001; silver (refined, primary), 1,229 metric tons; copper (ore and concentrate by metal content), 1,071,000 metric tons; and lead (by total mine content), 120,400 metric tons, down from 121,600 metric tons in 2001. All copper ore was mined by KGHM S.A., in the Lubin area; the government's share in KGHM's stock was 52%. Total copper reserves were 2,300 million tons containing 44 million tons of metal. Lead and zinc resources totaled 184 million tons; limestone and marl, 17,450 million tons; and gravel aggregates, 14,600 million tons. No gold was mined in 2003. Important industrial minerals produced in 2003 included hydraulic cement (10.948 million metric tons), glass sand (1.6 million tons), and sulfur (native [Frasch)], by-product, and from gypsum), 1.195 million tons. Also produced in 2002 were palladium, platinum, selenium, anhydrite, diatomite, feldspar, fuller's earth, fire clay, kaolin, gypsum, magnesite ore (crude), nitrogen, foundry sand, filing sand, lime sand, quartz, quartz crystal, sodium compounds, dolomite, limestone, and crushed and dimension stone. Barite mining, at Boguszow, was stopped in 1997, because of large-scale flooding.
Poland's mining and mineral-processing industry was extensive and appeared well positioned to respond to the country's rising needs for all forms of raw materials, especially those consumed by the construction sector. A major trend in Poland's nonferrous metals sector was the denationalization program that encompassed the aluminum, copper, and zinc industries. The acquisition of former German territories in 1945 enriched Poland with hard coal and, to a lesser extent, zinc and lead. Iron ore was found around Czestochowa, in south-central Poland, but in deposits of low metal content. Uranium deposits occurred in Lower Silesia.
Poland has only modest reserves of crude oil and natural gas. The country's main domestic energy sources are coal, lignite, and peat; and rivers remain a largely untapped source of power.
As of 1 January 2004, Poland had proven reserves of crude oil estimated at 96.4 million barrels and proven natural gas reserves estimated at 5.83 trillion cu ft. In 2003, oil production was estimated to average 23,500 barrels per day, while consumption in that year was tentatively placed at 424,000 barrels per day. As a result, Poland was a net importer of oil, most of which comes from Russia. Poland has the largest crude oil refining capacity in NorthCentral Europe, estimated at 350,000 barrels per day, as of 1 January 2004.
With natural gas reserves estimated at 5.83 trillion cu ft, as of 1 January 2004, Poland was North Central Europe's largest natural gas producer. In 2002, Poland produced an estimated 196 billion cu ft of natural gas, which accounted for 41% of domestic consumption, and came to an estimated 479 billion cu ft.
Coal, as previously noted, is Poland's most abundant energy source. Proven coal reserves at the beginning of 2003 amounted to 24.4 billion tons (of which about two-thirds are anthracite and bituminous), and are the largest in North Central Europe. In 2002, production of all types of coal was estimated at 177.8 million short tons, with demand at an estimated 149 million short tons in that year. Poland's hard coal reserves are concentrated in Upper Silesia, near the border with the Czech Republic. Other major coal basins are located in Lower Silesia and Lublin. Although the coal industry is one of the country's largest employers, a major restructuring of the industry has been initiated. From 1998 through 2002, employment in the industry went from 248,000 to 140,000 by the close of 2002. In addition, a further restructuring was planned for the period 2003 through 2006, and involves further reductions in employment and the closing of inefficient mines.
In 2002, Poland's electric power generating capacity was estimated at 29.307 million kW, of which 28.404 billion kW of capacity was dedicated to conventional thermal fuel plants. Hydroelectric capacity in 2002 was put at 0.868 billion kW, followed by geothermal/other at 0.035 billion kW. Electricity production in 2002 came to 133.980 billion kWh, of which 97.6% was from fossil fuels, 1.6% from hydropower, and less than 1% from other renewable sources. Consumption of electricity in 2002 was 117.533 billion kWh. In 2001, coal accounted for 93% of Poland's primary energy production. However, consumption had declined 23% between 1993 and 2002.
Poland has been gradually deregulating its power market since 1998. Each year an increasing number of companies are allowed to choose their own electricity provider. By 2006 the sector will be completely open.
Leading industries in Poland include food processing, fuel, metals and metal products, automotive parts, chemicals, coal mining, glass, shipbuilding, and textiles. Industrial production increased by 14.5% annually during 1971–75, but in the late 1970s, the growth rate began to fall. During the 1980s, it grew at an annual rate of 1.1%. With the destabilizing effects of the dissolution of the Soviet bloc and central planning, industrial production initially fell by 26% in 1990 before returning to positive growth between 1991–98. Poland produced 10 million tons of steel per year in the mid-1990s. Sulfur is another important industrial commodity; and its production totaled 1,901 tons per year. The cement industry turned out 12.3 million tons during the same period.
Light industries were long relegated to a secondary position but, since the 1970s, Poland has increased its production of durable household articles and other consumer goods. In the mid-1990s, Poland produced 401,000 automatic washing machines, 584,000 refrigerators and freezers, 841,000 television sets, 307,000 radios, and 21,000 tape recorders and dictaphones per year.
Currently Poland is among the top 10 world producers of coal, copper and sulphur, and among the top 20 producers of sulphuric acid, cement, television sets, passenger cars, buses and trucks, and power engineering. Poland is also a leading world producer of some food stuffs such as rye, sugar beets, meat, milk barley, wheat, sugar, and eggs.
Since the accession to the EU, there has been a rapid increase in exports as well as in relocation of production facilities such as car and truck assembly plants and household appliances plants from Western Europe to Polish commercial zones such as Lódz and Wroclaw. In addition, there have been many investments from non-European countries such as plans to build an LCD factory near Wroclaw by the South Korean concern LG Electronics.
Destruction of the Polish scientific community, buildings, and equipment during World War II was nearly total, requiring a tremendous rebuilding program. Attached to the various university faculties and government bodies are institutes, laboratories, and clinics devoted primarily to research, but some offering advanced instruction. In 1952, the Polish Academy of Sciences, established in Warsaw, replaced the old Polish Academy of Sciences and Letters of Cracow; it has sections of biological sciences; mathematical, physical, and chemical sciences; technical sciences; agricultural and forestry sciences; medical sciences; and earth and mining sciences. As of 1996, 54 scientific and technological research institutes were affiliated with the Academy of Sciences, and there were 101 scientific and technological research institutes attached to government ministries. In Warsaw are located a botanical garden and museums devoted to zoology, technology, and the earth. The Polish Maritime Museum is located in Gdańsk. The Nicholas Kopernik Museum in Frambork includes exhibits on the history of medicine and astronomy.
Research and development (R&D) expenditures in 2002 amounted to $2.4 trillion or 0.59% of GDP. Of that amount, 61.1% came from government sources, followed by the business sector at 31%. Higher education, private nonprofit groups and foreign sources accounted for 2.9%, 0.3% and 4.8%, respectively. Personnel engaged in R&D in that same year included 1,469 scientists and engineers and 296 technicians per million people. High technology exports in 2002 totaled $915 million, or 3% of the country's manufactured exports.
In 1996, Poland had 50 universities offering courses in basic and applied sciences. In 1987–1997, science and engineering students accounted for 28% of university enrollment. In 2002, of all bachelor's degrees awarded, 16.3% were in the sciences (natural, mathematics and computers, engineering).
In 1990, Poland replaced its 40-year old centrally planned economy with a free market system. Most small enterprises were privatized, bringing an end to chronic shortages of consumer goods. At the end of 1996, the share of private enterprises in retail trade exceeded 90%. The resulting increase in domestic demand was a primary factor in strengthening the business cycle. In the past few years, the trend in retail establishments, particularly in major cities, has moved from small, independent shops to international supermarket chains, hypermarkets, and large specialty stores. However, small business-owners have been forming associations aimed at promoting and preserving local, independent retailing.
Offices are open from 8 or 9 am to 4 pm Monday through Friday. Food stores are open from 6 or 7 am to 7 pm; other stores, from 11 am to 7 or 8 pm; and banks, from 9 am to 4 pm Monday through Friday, and 9 am to 1 pm on Saturday. The most important trade exhibition is the annual Poznan International Fair, which takes place in June.
According to World Bank report published in 2004, Poland is among the top 10 countries improving their operating climate for enterprises. There were over 90 franchises in operation, with national firms as well as foreign firms represented. The number of foreign enterprises has been growing constantly. According to GUS (the Central Statistical Office), in 2002, about 10–12% of the retail market was operated by foreign firms, particularly through chain stores providing a range of goods from food and apparel to furniture and hardware supplies; in the first half of 2004, the number of foreign enterprises exceeded 50,000 an increase of 1,034 companies. The attractiveness of Poland is connected with its advantageous geographical location, EU membership, low labor costs and a high number of people with higher education. The largest inflow of foreign direct investment has been recorded by the manufacturing sector, especially by the automotive and electronic equipment and pharmaceutical branches.
Until recently, foreign trade was a state monopoly under the control of the Ministry of Foreign Trade. After World War II, the orientation of Polish trade shifted from Western and Central European countries to Eastern Europe. This changed with the dissolution of the Soviet-bloc CMEA in 1991. In December of that year, Poland signed an association agreement with the EC (now the EU) and by 2000, 70% of its exports and 61% of its imports were going to EC members. Poland also fosters trade through its membership in the Central European Free Trade Agreement (CEFTA), which includes Hungary, the Czech Republic, and the Slovak Republic. Since gaining full membership in the EU in 2004, Polish exports to the West have continued to increase faster than imports. Trade with the countries to the east has recently recovered to the levels from before the 1998 Russian financial crisis, although it is often stifled by minor frictions with Russia and Belarus, for example the controversial restrictions on Polish meat exports to Russia in the fall of 2005.
Poland's export commodities are a mixture of manufactured goods including furniture (7.0%), garments (6.1%), motor vehicles (4.6%), iron and steel (3.9%), and ships (3.3%). Export commodities
|Italy-San Marino-Holy See||3,057.7||5,752.0||-2,694.3|
|(…) data not available or not significant.|
|Balance on goods||-5,725.0|
|Balance on services||527.0|
|Balance on income||-3,639.0|
|Direct investment abroad||-196.0|
|Direct investment in Poland||4,123.0|
|Portfolio investment assets||-1,296.0|
|Portfolio investment liabilities||3,740.0|
|Other investment assets||-1,838.0|
|Other investment liabilities||5,071.0|
|Net Errors and Omissions||-2,879.0|
|Reserves and Related Items||-1,206.0|
|(…) data not available or not significant.|
formed from natural resources include wood (2.5%); coal, lignite, and peat (2.3%); and copper (2.3%).
Measured in terms of commodity trade figures, negative balances have been the rule in Poland in the post–World War II period. In 1991, the collapse of exports to the Soviet Union dealt a sharp blow to overall export performance. The requirement to exchange by means of hard currency for Soviet raw materials and energy prevented a repeat of the 1990 trade surplus. Poland attracted approximately $50 billion of foreign direct investment between 1990 and 2000. Net official reserves have increased in recent years, due to large capital surpluses due to foreign direct investment and portfolio inflows.
The US Central Intelligence Agency (CIA) reported that in 2002 the purchasing power parity of Poland's exports was $32.4 billion while imports totaled $43.4 billion resulting in a trade deficit of $11 billion.
According to the International Monetary Fund (IMF), in 2001 Poland had exports of goods totaling $41.7 billion and imports totaling $49.3 billion. In 2005 imports totaled €50.9 billion and exports totaled €45.0 billion.
The Banking Law of 1 July 1982 substantially reformed the Polish banking system by giving banks an effective role in setting monetary and credit policy, thereby allowing them to influence economic planning. The Council of Banks, consisting of top bank officers and representatives of the Planning Commission and the Ministry of Finance, is the principal coordinating body.
The National Bank of Poland (Narodowy Bank Polski-NBP), created in 1945 to replace the former Bank of Poland, is a state institution and the bank of issue. It also controls foreign transactions and prepares financial plans for the economy. On 1 January 1970, the National Bank merged with the Investment Bank and has since controlled funds for finance and investment transactions of state enterprises and organizations. The function of the Food Economy Bank and its associated cooperative banks is to supply short and long-term credits to rural areas. The national commercial bank, Bank Handlowy w Warszawie (BH), finances foreign trade operations. The General Savings Bank (Bank Polska Kasa Opieki-PKO), a central institution for personal savings, also handles financial transfers into Poland of persons living abroad.
In March 1985, two types of hard-currency accounts were introduced: "A" accounts, bearing interest, for currency earned in an approved way; and "B" accounts, for other currency, bearing no interest. "B" accounts can be converted into "A" accounts after one year. Major enterprises in Poland conduct their business by interaccount settlements through the National Bank rather than by check, and wages are paid in cash. Banking laws in 1989 opened the country's banking system to foreign banks.
A fundamental reorganization of the banking sector took place between 1990 and 1992. The NBP lost all its central planning functions, including holding the accounts of state enterprises, making transfers among them, crediting their operations, and exercising financial control of their activities. The NBP thus became only a central bank, and state enterprises competed with other businesses for the scarce credits available from commercial banks. Nine independent (so-called commercial), although state-owned, regional banks were created.
In 1993, the first of these, the Poznan-based Wielkopolski Bank Kredytowy (WBK), was privatized. A second highly controversial privatization took place in early 1994 with the sale of the Silesian Bank (Bank Slaski). Also, the Krakow-based Bank Przemyslowo-Handlowy (BPH) was disposed of at the start of 1995 and Bank Gdanski was sold in late 1995. With four major banks privatized, five remained to be sold off in a process that was supposed to have been completed by 1996. With no real hope of meeting this deadline, the Polish government returned in 1996 to proposals for "bank consolidation" prior to privatization. A major round of privatization was due to begin in 1998-99 beginning with the sale of Pekao, the country's largest commercial bank. This sale finally put over half of the industry's holdings in private hands. At the same time, foreign investment in Polish banks continued to increase. Citibank, ING, Commerzbank, Allied Irish Bank, and J.P. Morgan were leading foreign investors in 1998. In 2001, Bank Handlowy w Warszawie SA merged with Citibank (Poland) SA, but retained its historic name.
The International Monetary Fund reports that in 2001, currency and demand deposits—an aggregate commonly known as M1—were equal to $23.0 billion. In that same year, M2—an aggregate equal to M1 plus savings deposits, small time deposits, and money market mutual funds—was $82.8 billion. The money market rate, the rate at which financial institutions lend to one another in the short term, was 16.2%. The discount rate, the interest rate at which the central bank lends to financial institutions in the short term, was 14%.
In early 1991 important legislation was introduced to regulate securities transactions and establish a stock exchange in Warsaw. At the same time, a securities commission was formed for consumer protection. A year later, the shares of 11 Polish companies were being traded weekly on the new exchange. Restructuring the
|Revenue and Grants||223,659||100.0%|
|General public services||81,294||30.8%|
|Public order and safety||8,592||3.3%|
|Housing and community amenities||5,325||2.0%|
|Recreational, culture, and religion||1,861||0.7%|
|(…) data not available or not significant.|
financial market not only was necessary for increasing the overall efficiency of the economy and accelerating privatization, but also was a precondition for the rapid influx of Western capital critical to economic development.
When the Warsaw Stock Exchange opened in April 1991, it had only five listed companies, but by September 1996 that figure had increased to 63. Into 1998, the market still suffered growing pains similar to those afflicting other emerging markets. In particular, the high liquidity of Polish stocks made Poland particularly vulnerable to panic selling. Market capitalization in 2001 was $26 billion, down 17% from the $31.3 billion level of 2000. The WIG All Share Performance Index was at 13,922.2 in 2001, down 22% from 17.847.6 in 2000. As of 2004, a total of 225 companies were listed on the Warsaw Stock Exchange, which had a market capitalization of $71.102 billion. In 2004 the WIG All Share Performance Index rose 27.9% from the previous year to 26,636.2.
In 1948, all insurance other than social insurance was included in a centralized State Insurance Bureau, with the former reinsurance organization, Warta, continuing its activity. In 1994, Warta was privatized and was one of three major insurers who, together, controlled over 90% of Poland's insurance market. In 1999, 54 licensed insurance companies competed in the Polish market.
Insurance is dominated by a state concern, PZU, but a number of Western companies, including the United Kingdom's Commercial Union (CU), have been tempted into joint ventures in the life insurance end of this underdeveloped market. CU began its Polish operations in cooperation with the Wielkopolski Bank Kredytowy (WBK) bank. It sold around 130,000 policies in its first four years. PZU was privatized in 1999. In Poland, third-party auto liability, farmer's liability, fire insurance, workers' compensation, and nuclear liability are all compulsory. For 2003, the value of direct premiums written totaled $6.258 billion, of which nonlife premiums accounted for $3.946 billion. In 2003, Poland's top nonlife insurer was PZU, while PZU Zycie was the nation's leading life insurer, with gross written nonlife and life insurance premiums of $1.86 billion and $1.32 billion, respectively.
The annual budget is presented to the Sejm in December and becomes effective for the fiscal year beginning on 1 January. A new set of economic reforms, announced in early 2002, aim to improve the country's investment climate and public finances. Privatization in the former Eastern bloc nation has been fairly successful, with approximately two-thirds of GDP now coming from the private sector. By the early 1990s, Poland was the first formerly planned economy in Eastern Europe to come out of recession and experience economic growth.
The US Central Intelligence Agency (CIA) estimated that in 2005 Poland's central government took in revenues of approximately $52.7 billion and had expenditures of $63.2 billion. Revenues minus expenditures totaled approximately -$10.4 billion. Public debt in 2005 amounted to 47.3% of GDP. Total external debt was $123.4 billion.
The International Monetary Fund (IMF) reported that in 2001, the most recent year for which it had data, central government revenues were z223.6 million and expenditures were z263.58 million. The value of revenues was us$54.6 billion and expenditures us$65.6 billion, based on a market exchange rate for 2001 of us$1 = z4.0939 as reported by the IMF. Government outlays by function were as follows: general public services, 30.8%; defense, 3.4%; public order and safety, 3.3%; economic affairs, 4.5%; housing and community amenities, 2.0%; health, 0.8%; recreation, culture, and religion, 0.7%; education, 4.8%; and social protection, 51.5%.
Personal income tax in Poland in 2005 is progressively structured with a top rate of 40%, although under certain circumstances, an individual may opt to be taxed at a flat 19% rate on business income. Individuals realizing capital gains from the sale of land, a building, or dwelling not used for business purposes is subject to a 10% rate.
Poland has a general corporate profits tax rate of 19%. Capital gains and branch operations are each taxed at the corporate rate. Dividends and interest paid to residents and nonresidents are taxed at a flat 19% rate. Income from interest, fees and royalties are subject to a 20% withholding rate, unless other rates have been agreed to in bilateral tax treaties (BITs). Poland has BITs with at least 66 countries. In the BIT with the United States, withholding rates are 0% on interest income, 10% on income from royalties, and 5% on dividend income if the receiving company owns at least 10% of voting shares.
The main indirect tax is a system of value-added taxes (VATs). There are four VAT rates: 22% on most goods and some services; 7% on processed foodstuffs and construction materials; 3% on unprocessed foodstuffs; 0% on exported goods and services, and "VAT-exempt" applied to several groups of services, including financial services, insurance and health care. Excise taxes are charged on alcohol, cars, petrol, and tobacco products. There is also a civil transactions tax.
Poland uses the Harmonized System of Classification. Products are divided into three categories to determine which rate they receive: developing nations, WTO members, and countries with which Poland has a special trade relationship such as a bilateral preferential trade agreement. Under the terms of a 1992 agreement, Poland uses the EU Nomenclature System of Tariff classification and has granted duty-free status to over 1,000 line items from EU countries. Tariffs range from 0% to nearly 400%. In addition, all goods are subject to a 5% import tax, an excise tax on luxury items, and a VAT of 0%, 3%, 7%, or 22%, depending on the commodity. As a result of its efforts to join in the next round of EU expansion, Poland is bringing its trade regulations in line with EU standards.
Prior to World War II, considerable foreign capital was invested in the Polish economy, particularly in petroleum and mining, which were mostly foreign owned. A nationalization decree in 1946 confiscated foreign properties and nationalized Poland's industries, eliminating foreign investments completely. The decree provided for no compensation procedures and foreign governments involved negotiated directly with Poland. The first joint venture with Western counterparts (one Austrian and one US company) was formed in early 1987 to build a new airport terminal in Warsaw. In mid-1991, there were 4,100 foreign registrations, worth $506 million, and in 1993 another $2 billion in foreign investment entered Poland. Among the industrial companies sold to Western interests were Polam-Pila (lightbulbs) to Phillips, Polkolor (TV sets) to Thomson, Pollena-Bydgoszcz (detergents) to Unilever, and Wedel (confectioneries) to Pepsico Foods.
In 1996–97, Poland continued to invite foreign investors to help the government turn some of its banks and oil, arms, and telecommunications companies over to the private sector. In October 1996 President Aleksander Kwasniewski stated that the government's campaign to shed costly state-owned enterprises had been successful, with the private sector now accounting for about 70% of the goods and services produced in the economy. Total foreign direct investment (FDI) reached nearly $27.3 billion in 1998. FDI inflow in 1998 was $6.3 billion, up from nearly $5 billion in 1997, and increased to $7.2 billion in 1999, undeterred by the effects of the Russian financial crisis. Annual FDI inflow peaked at over $9.3 billion in 2000, having grown at an average rate of 44% a year since 1991 to 2000. Total FDI stock was over $42 billion in 2000. In 2001 and 2002, the economic slowdown, and, particularly, the worldwide decline in foreign investments, helped reduce annual FDI inflows into Poland to $8.3 billion in 2001 and to $6.06 billion in 2002. Cumulative FDI as of 2002 was $61.45 billion.
After World War II, the economy of Poland was centrally planned and almost completely under state control, especially in nonagricultural sectors. The nationalized industries and businesses operated within the national economic plan and were governed by the directives issued by the pertinent ministries. After 1963, however, centralized planning and management were somewhat relaxed, and state-owned enterprises gained more freedom in the design and implementation of their programs. Private undertakings were confined to personal crafts and trades and agriculture.
Under the three-year plan for 1947–49, principal emphasis was placed on the reconstruction of war-devastated areas and industries, in order to raise production and living conditions at least to their prewar levels. Economic planning followed Soviet lines, setting production goals that determined tasks for each sector on a long-term basis. Under the six-year plan for 1950–55, the emphasis continued to be on heavy industry, and the housing, transport, agriculture, and consumer sectors lagged. The five-year plan for 1956–60, originally cast along the same lines, was modified after the 1956 disturbances. It called for a lessened rate of industrial expansion and for increases in agricultural output, housing, consumer goods, and social services. Under a long-range plan for 1961–75, which governed the three five-year plans falling within that period, emphasis was placed on a direct improvement in living standards. The first and second of these plans (1961–65 and 1966–70) were oriented toward investments intended (1) to develop the raw-material base of the country, especially the newly discovered resources of sulfur, copper, and lignite; (2) to secure employment opportunities for the rapidly growing population of working age; and (3) to improve Poland's international trade balance. The five-year plan for 1961–65 reached its industrial targets but fell short in the areas of agriculture and consumer goods. The period 1966–70 witnessed two poor agricultural years in addition to export lags, and there were shortages of basic food commodities in 1969–70.
In late 1970, violent protests erupted over the government's stepped-up efforts to increase production. After the change in political leadership from Gomulka to Gierek, government emphasis shifted from heavy industry to light, consumer-oriented production. In addition, through a concentration of investment in mechanization, fertilizers, and other farm improvements, the government sought and achieved a 50% increase in food production. Overall, the 1971–75 five-year plan achieved its main targets by a wide margin, with industrial production up about 73%. The 1976–80 plan, which aimed at a 50% increase in industrial production and a 16% increase in agricultural output, ran into difficulty almost from the beginning, and by 1979 the economy had entered a period of decline and dislocation that continued into 1982. An economic reform stressing decentralization of the economy was introduced in January 1982, but it failed to produce any significant improvements. With price rises and consumer goods shortages continuing to fuel popular discontent, the government in March 1983 announced a three-year austerity plan for 1983–85. Its aims included a general consolidation of the economy, self-sufficiency in food production, and increased emphasis on housing and the production of industrial consumer goods. By 1986, the economy had rebounded. The 1986–90 plan expected the national income to grow 3–3.5% annually, industrial output to increase by 3.2% each year, and exports to grow by 5% (in fixed prices) annually. These goals were not reached. A "second stage," proclaimed in 1986, called for more autonomy for individual enterprises and for more efficient management, with top jobs filled without regard to political affiliations.
The Economic Transformation Program adopted in January 1990 aimed to convert Poland from a planned to a market economy. Measures were aimed at drastically reducing the large budget deficit, abolishing all trade monopolies, and selling many state-owned enterprises to private interests.
The slow pace of privatization picked up somewhat in 1995, as 512 smaller state enterprises were transferred to private National Investment Funds under the Mass Privatization Program, but large-scale industry remained largely under state control. However, the government subsequently made an attempt to privatize such large-scale sectors of the economy as banks and oil, arms, and telecommunications. Poland in the early 2000s was in the process of bringing its economic policies in line with EU standards. These policies promise even further liberalization and foreign investment into the Polish economy. Poland officially joined the EU in May 2004. In 2002, the government announced a new set of economic reforms, including improving the investment climate (particularly for small- and medium-sized enterprises), and improving the country's public finances to prepare the way for the adoption of the euro. Recently, the government has focused utilizing the EU funds to improve Poland's infrastructure.
A social insurance institute administers social security programs through a network of branch offices, under the provision of new legislation passed in 1998 and implemented in 1999. Social security, including social insurance and medical care, covers virtually the entire population. Old age, disability, and survivors' pensions are provided, as well as family allowances, sickness benefits, maternity benefits, workers' compensation, and unemployment. The system is funded by contributions from employers and employees and government subsidies. In 2004 a revised universal system of family allowances funded by the government covers all residents.
The constitution establishes that all citizens are equal, regardless of gender, but discrimination persists. Women participate actively in the labor force, but are concentrated in low-paying professions and earn less than men on average. Also, women are more likely to be fired and less likely to be promoted than men. Violence against women and domestic abuse remain a widespread problem. The law does not provide restraining orders, and even convicted abusers generally go unpunished. As of 2004, there were not enough shelters for battered women. Sexual harassment in the workplace is slowly being addressed.
The Romani minority living in Poland faces discrimination by local authorities. Anti-Semitic harassment, vandalism, and violence persist. The judicial system is hampered by inefficiency and budget constraints, and there are marginal restrictions on freedoms of speech and press.
As of 2004, there were an estimated 220 physicians, 490 nurses, and 30 dentists per 100,000 people. The same year, the total health care expenditure was estimated at 6.2% of GDP.
Poland's birth rate was an estimated 10.3 per 1,000 people as of 2002. Approximately 75% of married women (ages 15 to 49) used contraception. Poland immunized children up to one year old against tuberculosis, 94%; diphtheria, pertussis, and tetanus, 98%; polio, 96%; and measles, 97%.
Life expectancy in 2005 averaged 74.74 years and infant mortality was 7.36 per 1,000 live births. The general mortality rate was 10 per 1,000 people.
There were many cases of tuberculosis as part of the spread of the disease throughout much of Eastern Europe. The heart disease mortality rate for Polish men and women was below average for high development countries. The likelihood of dying after 65 of heart disease was 240 in 1,000 for men and 201 in 1,000 for women. The HIV/AIDS prevalence was 0.10 per 100 adults in 2003. As of 2004, there were approximately 14,000 people living with HIV/AIDS in the country. There were an estimated 100 deaths from AIDS in 2003.
Almost 40% of all urban dwelling space was destroyed during World War II. Although investment in public housing has increased, and credits have been assigned for cooperative and private construction, the housing shortage remained critical five decades later. The average wait for an apartment ranged from 10–15 years. In 1984 there were 10,253,000 dwelling units; an additional 193,000 dwelling units were constructed in 1985. In 2002, there were about 12.5 million dwelling units registered in the census serving about 13.3 million households; about 93.9% of these were occupied dwellings. About 67.6% of all dwellings were in urban areas. About 55.2% of all dwellings were owned by private individuals. The average number of persons per dwelling was 3.25. At least 76.2% of all dwellings were built after 1944. The housing deficit in 2002 was estimated at about 1,567,000; an estimated 6.5 million people were living in substandard housing.
Primary, secondary, and most university and other education is free. State and local expenditure on education is, therefore, substantial. Lower schools are financed by local budgets, higher and vocational schools from the state budget. As of 2003, public expenditure on education was estimated at 5.6% of GDP, or 12.8% of total government expenditures.
Since 1999, the school system, which is centralized, consists of an six-year primary school followed by a three-year lower secondary general education school. Students then have an option to enroll in a four-year technical school, a three-year upper secondary school, or a two- to three year vocational school. Vocational schools are attended by students studying technology, agriculture, forestry, economy, education, health services, and the arts. The academic year runs from October to June.
In 2001, about 49% of children between the ages of three and six were enrolled in some type of preschool program. Primary school enrollment in 2003 was estimated at about 98% of age-eligible students. The same year, secondary school enrollment was about 91% of age-eligible students. It is estimated that about 98.5% of all students complete their primary education. The student-to-teacher ratio for primary school was at about 13:1 in 2003; the ratio for secondary school was about 14:1.
Higher learning is under the jurisdiction of the Ministry of Higher Education and other ministries. A matriculation examination, which is common for all students, is required for admission to institutions of higher learning. As of 2004, there were 128 state institutions of higher learning and 304 nonstate institutions. Jagiellonian University, among the oldest in Europe, was established at Cracow in 1364. Other prominent universities are the Warsaw University; the Central School of Planning and Statistics (Warsaw); the Higher Theater School (Warsaw); the Academy of Fine Arts (Cracow); and the Adam Mickiewicz University (Poznań). During the communist era the Roman Catholic University at Lublin was the only free private university in the Socialist bloc. Evening and extramural courses are available for anyone who is interested and is not a part of the school system. Foreign students are also welcome to study in Poland, either as regular students or at their summer schools. In 2003, about 60% of the tertiary age population were enrolled in some type of higher education program; 50% for men and 71% for women. The adult literacy rate for 2003 was estimated at about 99.8%.
As of 2003, public expenditure on education was estimated at 5.6% of GDP, or 12.8% of total government expenditures.
The National Library, established in Warsaw in 1928, is the second-largest in Poland, with about 2.8 million items, including periodicals, manuscripts, maps, illustrations, and music. Other important libraries are the Public University and the government departmental libraries in Warsaw; Poland's largest library, the Jagiellonian University Library in Cracow, which has 3.5 million volumes; and the Ossolineum Library in Wroclaw. There are over 9,000 public libraries in the country. Lax security at Poland's libraries poses a challenge to the preservation of rare documents: in 1998, a scientific library in Cracow reported the theft of a rare book by Nicholas Copernicus, and in 1999, the Jagiellonian University Library reported the theft of an indeterminate number of rare manuscripts.
Of the more than 500 museums in Poland, the foremost is the National Museum in Warsaw, which has an extensive and important art collection as well as a collection of Polish art from the 12th century to present day. Other important museums are the National Museum in Cracow, notable for its collection of Far Eastern Art, and the National Museum in Poznań, which has a celebrated collection of musical instruments. Cracow also has an important collection of European decorative arts at the Wawel Royal Castle, housed in a 16th century manor house, and the Czartoryski Museum, a world-class collection of antiquities and contemporary artifacts including 35,000 prints, drawings, and paintings. Warsaw has dozens of museums, including the Center for Contemporary Art, founded in 1986, in Ujazdowski Castle; the Museum of Independence, founded in 1990, chronicling Poland's pivotal role in the collapse of the Soviet Empire; the Museum of Polish Emigration to America; the Frederick Chopin Museum, chronicling the life of one of the country's best-known composers; the Marie Curie Museum, housed at her birthplace; and the Museum of the Jewish Historical Institute.
In 2003, there were an estimated 319 mainline telephones for every 1,000 people; about 500,000 people were on a waiting list for telephone service installation. The same year, there were approximately 451 mobile phones in use for every 1,000 people.
In 2004, the government-owned Polish Television (TVP) was the most widely viewed network with four channels accounting for about 54% of the broadcasting market share. The main privately held competitors were the TVN and Polsat networks. Cable television and various satellite services are available. As of 1998, there were 14 AM and 777 FM radio stations. In 2003, there were an estimated 523 radios and 229 television sets for every 1,000 people. About 94 of every 1,000 people were cable subscribers. Also in 2003, there were 142 personal computers for every 1,000 people and 232 of every 1,000 people had access to the Internet. There were 565 secure Internet servers in the country in 2004.
The largest Polish daily newspapers, with circulation as noted, are: Trybuna Slaska, 800,000 in 2002; Gazeta Wyborcza, 558,000 in 2004; 460,000 (weekend edition in 2005); Express Wieczorny, 400,000 in 2002; Zycie Warszawy, Express Illustrowany, 370,000; Gazeta Poznanska, 320,000 (weekend edition); Gazeta Robotnicza, 315,000; Fakt, 300,000 in 2003; Czas Krakowski, 260,000 in 2002 (weekend edition); Nasz Dziennik, 250,000 in 2005; Sztandar Mlodych, 250,000 in 2002; and Rzeczpospolita, 244,000 in 2004.
Though the constitution provides for free speech and a free press, there are some restrictions on these rights. The Penal Code prohibits speech which publicly insults or ridicules the Polish state or its principal organs; it also prohibits advocating discord or offending religious groups. Though the media are not censored, they may be subject to prosecution under these and other penal codes.
The Polish Chamber of Commerce and the Chamber of Foreign Trade promote foreign trade by furnishing information, establishing or extending commercial relations, and arranging for Polish participation in trade fairs, and exhibitions abroad. The most important worker's organization in Poland is Solidarity, founded in 1980 by Lech Welesa. There are a number of professional associations and trade unions representing a wide variety of occupations.
The P.E.N. Club–Poland is based in Warsaw. The Frederick Chopin Society is a multinational organization promoting the life and works of this Polish composer and pianist. Several professional associations, such as the Polish Medical Association, also serve to promote research and education in specific fields.
There are also many cultural, sports and social organizations in Poland. National youth organizations include the European Federalist Youth, Junior Chamber, Polish Students' Union, Polish Environmental Youth Movement, Union of Young Christian Democrats, The Polish Scouting and Guiding Association, and YMCA/YWCA. There are numerous sports associations promoting amateur competitions in a wide variety of sports for athletes of all ages. There are organizations affiliated with the Special Olympics and the Paralympic Committee, as well as the Olympic Committee.
National women's organizations include the Democratic Women's Union and the Polish Association of University Women. Other social action groups include the Helsinki Human Rights Foundation and Fundacja Stefana Batorego, a group which promotes a democratic and open society. There are national chapters of the Red Cross Society, Habitat for Humanity, UNICEF, and Amnesty International.
The main tourist attractions include the historic city of Cracow, which suffered little war damage; the resort towns of Zakopane, in the Tatras, and Sopot, on the Baltic; and the restored Old Town in Warsaw, as well as the capital's museums and Palace of Science and Culture. Camping, hiking, and football (soccer) are among the most popular recreational activities.
Foreign visitors to Poland must have a valid passport. All visitors are required to carry a visa except citizens of over 30 nations including the United States and members of the European Union.
There were approximately 52 million visitors who arrived in Poland in 2003, about 99% of whom came from Europe. Hotel rooms numbered 68,588 with 134,323 beds and an occupancy rate of about 36%. The average length of stay was three nights. That year tourism receipts totaled $4.7 billion.
In 2005, the US Department of State estimated the cost of staying in Warsaw at $286 per day. Elsewhere in Poland, daily travel expenses were estimated to be between $139 and $221.
Figures prominent in Polish history include Mieszko I (fl.10th century), who led Poland to Christianity; his son and successor, Boleslaw I ("the Brave," d.1025), the first king of sovereign Poland; Casimir III ("the Great," 1309–70), who sponsored domestic reforms; and John III Sobieski (1624–96), who led the PolishGerman army that lifted the siege of Vienna in 1683 and repelled the Turkish invaders. Tadeusz Andrzej Bonawentura Kościuszko (1746–1817), trained as a military engineer, served with colonial forces during the American Revolution and then led a Polish rebellion against Russia in 1794; he was wounded, captured, and finally exiled. Kazimierz Pulaski (1747–79) fought and died in the American Revolution, and Haym Salomon (1740–85) helped to finance it. The reconstituted Polish state after World War I was led by Józef Pilsudski (1867–1935), who ruled as a dictator from 1926 until his death. Polish public life since World War II has been dominated by Wladyslaw Gomulka (1905–82), Edward Gierek (1913–2001), and Gen. Wojciech Jaruzelski (b.1923), Communist leaders, respectively, during 1956–70, during 1970–80, and after 1981. Important roles have also been played by Stefan Cardinal Wyszynski (1901–81), Roman Catholic primate of Poland, archbishop of Gniezno and Warsaw, and frequent adversary of the postwar Communist regime; Karol Wojtyla (1920–2005), archbishop of Cracow from 1963 until his elevation to the papacy as John Paul II in 1978; and Lech Walesa (b.1943), leader of the Solidarity movement during 1980–81, Nobel Peace Prize laureate in 1983, and President of Poland from 1990 to 1995.
The father of Polish literature is Nicholas Rey (1505–69), one of the earliest Polish writers to turn from Latin to the vernacular. Poland's golden age is marked by the beginning of literature in Polish; its greatest poet was Jan Kochanowski (1530–84). Notable among 19th-century poets and dramatists was Adam Mickiewicz (1798–1855), whose The Books of the Polish Nation and of the Polish Pilgrimage, Pan Tadeusz, and other works exerted a paramount influence on all future generations. Other leading literary figures were the poets and dramatists Juliusz Slowacki (1809–49) and Zygmunt Krasiński (1812–59), whose Dawn breathed an inspired patriotism. Józef Kraszewski (1812–87), prolific and patriotic prose writer, is considered the father of the Polish novel. The leading late-19th-century novelists were the realists Aleksander Glowacki (1847–1912), who wrote under the pseudonym of Boleslaw Prus, and Henryk Sienkiewicz (1846–1916), Poland's first Nobel Prize winner (1905), whose The Trilogy described the 17th-century wars of Poland; he is internationally famous for Quo Vadis. Another Nobel Prize winner (1924) was the novelist Wladyslaw Reymont (1867–1925), acclaimed for The Peasants. A Pole who achieved stature as an English novelist was Joseph Conrad (Józef Teodor Konrad Korzeniowski, 1857–1924). Other important literary figures around the turn of the century were the playwright and painter Stanislaw Wyspiański (1869–1907), the novelist Stefan Zeromski (1864–1926), and the novelist Stanislaw Ignacy Witkiewicz (1885–1939). The best-known modern authors are novelist and short-story writer Isaac Bashevis Singer (1904–91), a Nobel Prize winner in 1978 and a US resident after 1935; the satirist Witold Gombrowicz (1904–69); science-fiction writer Stanislaw Lem (b.1921); the dissident novelist Jerzy Andrzejewski (1909–83); the poet Czeslaw Milosz (1911–2004), a Nobel Prize winner in 1980 and resident of the United States after 1960; and novelist Jerzy Kosinski (1933–91), who lived in the United States after 1957 and wrote in English.
The greatest Polish composer was Frédéric Chopin (1810–49), born in Warsaw, who lived in Paris after 1831. A popular composer was Stanislaw Moniuszko (1819–72), founder of the Polish national opera and composer of many songs; he influenced such later composers as Wladyslaw Zeleński (1837–1921), Zygmunt Noskowski (1846–1909), and Stanislaw Niewiadomski (1859–1936). Other prominent musicians include the pianist Ignacy Jan Paderewski (1860–1941), also his country's first prime minister following World War I; the great harpsichordist Wanda Landowska (1877–1959); the renowned pianist Arthur Rubinstein (1887–1982); the violinist Wanda Wilkomirska (b.1929); the conductor Stanislaw Skrowaczewski (b.1923); and the composers Mieczyslaw Karlowicz (1876–1909) and Karol Szymanowski (1883–1937). Witold Lutoslawski (1913–94) and Krzysztof Penderecki (b.1933) are internationally known contemporary composers.
The first Polish painters of European importance were Piotr Michalowski (1800–55) and Henryk Rodakowski (1823–94). In the second half of the 19th century, Polish realism reached its height in the historical paintings of Jan Matejko (1838–93), Artur Grottger (1837–67), Juliusz Kossak (1824–99), and Józef Brandt (1841–1915), as well as in genre painting and the landscapes of Wojciech Gerson (1831–1901), Józef Szermentowski (1833–76), Aleksander Kotsis (1836–77), Maksymilian Gierymski (1846–74), Aleksander Gierymski (1849–1901), and Józef Chelmoński (1849–1914). Feliks Topolski (1907–89), who lived in London after 1935, is well known for his oil paintings, watercolors, and drawings. Andrzej Wajda (b.1926), Roman Polański (b.1933), an expatriate since the mid-1960s, Krzysztof Zanussi (b.1939), and Krzysztof Kieślowski (1941–1996) are famous film directors, and Jerzy Grotowski (1933–1999) was a well-known stage director.
The outstanding scientist and scholar Nicolaus Copernicus (Mikolaj Kopernik, 1473–1543) is world renowned. Among Poland's brilliant scientists are Maria Sklodowska-Curie (1867–1934), a codiscoverer of radium and the recipient of two Nobel Prizes, and Casimir Funk (1884–1967), the discoverer of vitamins. Oskar Lange (1904–66) achieved renown as an economist.
Poland has no territories or colonies.
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