1. Poland International Trade

2. Background History
-Poland is located in the northern portion of central Europe
-The capital of Poland is Warsaw.

3. Background History Size: 312,685 km (slightly smaller than New Mexico)
Land: 304,465 km
Water: 8,220 km
Coastline: 491 km (Baltic Sea)
Terrain: Mostly flat, mountainous along southern border
Major Natural Resources: coal, sulfur, copper, and silver.

4. Background History Population: 38,635,144 (2004) Age 0-14= 16.7%
Population Growth Rate: .03%
Hungary’s= -.26%, Czech Republic= -.05%, Germany= 0%, Belarus= -.09, Ukraine= -.63%, Lithuania= -.3, Slovakia= .15%
Life Expectancy: years old

5. Government Type: Republic Divided into 16 provinces
President elected by open elections
Bi-cameral legislature
Senate (100 seats)
Sejm (460 seats)

6. International Trade
: Communist government restricts trade to only Soviet countries.
Poland became very dependent on Soviet Union.
: Government restricts all western European trade.
: Poland becomes the fifth largest ship producer in the world.
Was most of Poland’s entire trade
Export mostly to Soviet Union
1986- Poland amends laws and allows bonds to be sold to foreign investors.
State enterprises were allowed to issue bonds and join joint ventures with foreign investment.
Did not raise FDI enough to see any change

7. International Trade in Transition
tier banking system created
The Law on Economic Activity
Small step to correct rising inflation
: “Shock Therapy” opens up trade markets.
Significant increases in FDI and Trade % of GDP
Increased the previously falling real GDP
Corrected the out of control inflation
Laws making it safer for foreign investors were put in place
Foreign investors mostly only invested if they received management rights

8. Trade Organizations PHARE signed in 1989
Designed to bring aid from European Communities to Poland and Hungary
Assist with political change and new markets
First step in eventual admittance to EU
The Efta-Poland free trade agreement
Signed in Geneva, Switzerland on 10 December 1992, came into effect Sept. 1, 1994.
Main Objective
To enhance the development of world trade by removing international trade barriers.

9. Trade Organizations World Trade Organization European Union (2004)
July 1, 1995
Increase of Trade % of GDP after joining
European Union (2004)
Poland’s foreign trade policy changed drastically after joining the EU.
Poland was in direct connection with the economically successful western European Countries.
Tightened tariffs and increased customs controls on the eastern border which is the external border of the European Union.

10. Economics
Poland’s real GDP has steadily risen in the past 25 years since fall of Communism.
Drop between from political instability.
Avg. real GDP growth Rate= 3.5%
Current real GDP growth Rate= 5%

11. Economics
Poland’s growth rate negative initially due to political and economic reform.
Poland has had a higher growth rate annually than the world’s avg. and EU avg.
Except 2001
Direct relation with increase in real GDP

12. Total Exports & Imports
$ 92,720,000,000
31st largest in the world
Total Imports (2005)
$95,670,000,000
28th largest in the world

13. Exports Main Export Partners European Union- 70.5%
Germany- 30%
Italy- 6.1%
France- 6%
UK- 5.4%
Czech Republic- 4.3%
Netherlands- 4.3%
Rest of World- 29.5%
Russia, Hong Kong, United States

14. Imports Main Import Partners European Union- 65% Rest of World- 35%
Germany- 24.4%
France- 6.7%
Italy- 8.5%
Rest of World- 35%
Russia- 7.3%
China- 4.6%

15. Division of Trade Division of Trade (2 major divisions)
Merchandise Exports/Imports
Agriculture (raw materials)
Crude materials except fuels, Livestock
Food
Exports- Potatoes, fruit, wheat
Fuel
Mostly from Russia
Oil, natural gas
Manufactures
Export- Machinery, transport equipment, other misc. manufactured items
Import- Chemicals, medicine, cars/motorcycles
Ores & metals
Crude fertilizers, minerals, scrap metal, glass

16. Merchandise Exports/Imports

17. Commercial Service Exports/Imports
Computers/Communications and Services
International telecommunications, postal, construction, all services-financial
Insurance & Financial Services
Freight insurance, life insurance, foreign exchange transactions
Transport Services
Anything relating to the carriage of passengers or movement of freight
Travel Services
Goods and services consumed by travelers
Lodging, meals

18. Commercial Service Exports/Imports

19. Net Exports
Poland’s international trade has shown improvement in the last 4 years. Net exports are moving toward the positive while total imports continue to grow rapidly.

20. Poland & Hungary Poland & Hungary very similar paths of transition.
Communism fell at almost same time ( )
Both declared “shock therapy”
Hungary’s much more gradual
Led to a slower and less effective transition initially.
Real wages plummeted in bringing about a 2nd “shock therapy”
Rebounded the economy
Poland’s shock therapy was effective very quickly
Modern Governments
Poland- Republic
Hungary- Parliamentary Democracy