Anyone looking for proof of Poland’s enduring investment appeal found it following the June 1 presidential election, which saw the right-wing Law and Justice Party candidate Karel Nawrocki narrowly defeat the governing Civic Platform’s Rafal Trzakowski. Instead of pulling back amid fears that Prime Minister Donald Tusk’s policies would be slowed, and political divisions deepen, investors remained upbeat.
The stock market, which has been one of the world’s best performing this year, continued its record streak as the WIG Index went into early August 35% above its August 2024 mark. Shares in oil and gas producer Orlen rose 60% over that period while supermarket chain Dino and insurance company PZU both saw their share price rise more than 30%. Instead of holding firm given the economic uncertainties, the National Bank of Poland cut base interest rates to 5%, with another 25-basis point cut anticipated for September, as inflation continued its downward path.
All this reflects the resilience the Polish economy has built up over the last decade, especially pre-pandemic, when GDP growth averaged 5% a year and annual inflows of foreign direct investment typically up to 4% of GDP.
“With Poland the fastest growing economy in the region—we forecast 3% GDP growth this year and next, rising to 3.1% in 2027—our sovereign rating is A- with Stable Outlook, a level we’ve held steady for 18 years,” says Milan Trajkovic, associate director, Fitch Ratings. The size of the economy—37 million people—its diversity, and the fact that it is not overly dependent on US exports; a slowing, tariff-sensitive auto industry; or the softening German economy are all positives, he adds.
According to UNCTAD, between 2000 and 2023, Poland attracted over $335 billion in foreign investment, almost half the combined total for the eight Central and Eastern European (CEE) states that joined the EU in 2004. Poland has been particularly successful at near-shoring, thanks to its well-educated workforce, developed infrastructure, diversified economy, and close integration with the EU.
As Finance Minister Andrzej Domański pointed out in an article for the International Monetary Fund from this June, the EU has been very good for Poland as its membership in the Single European Market has facilitated rapid technology transfer and opened the way for exports to grow to almost 3.5 times their previous level.
Indeed, the Polish Economic Institute has calculated that European integration boosted GDP by 40% over what it would have posted had Poland not joined the EU.
The nation also holds the CEE regional record in spending EU funds, led by funds distributed under the National Recovery and Resilience Plan (NRRP). Some €60 billion (about $70 billion) scheduled through the end of 2026, including €25.3 billion in grants and the rest in preferential loans, will be available to Poland under this facility, a big chunk of the €648 billion earmarked by the EU to speed recovery from the Covid pandemic and its aftermath. According to the European Commission, Poland will be the largest recipient under the €2 trillion budget being proposed for 2028-34, with additional funds to be made available for security, agriculture, and innovation.
“Poland will most likely remain a champion in both absorbing and distributing EU funds into the real economy,” says Trajkovic, “which are expected to account for 1% of GDP this year and 3% next. Along with domestic consumption and investment, they will be one of the main drivers of the economy.”
The good news continues with FDI and Greenfield investments. According to the 2025 EY Europe Attractiveness survey, while FDI within the entirety of Europe dropped some 5% over 2024 and inflows to Poland retreated from 2023’s record of $28 billion, Polish industries including new technologies, renewable energy, services, and logistics continue to see strong investor interest. Reinvested profits are on an upward trend.
The EBRD Commits
Despite some political turmoil, the country has changed dramatically in the past five years, says Andreea Moraru, the European Bank for Reconstruction and Development’s (EBRD) new director for Poland and the Baltic States. “Compared to 2019, when I was last here, Warsaw is utterly transformed,” she notes. “Real estate is booming, as is construction, and companies are much more ambitious, with many now looking abroad to expand.”
Poland’s economy today is sophisticated, innovative, and cutting edge, she says: “Companies are moving away from simple manufacturing to more value-added production. However, to stay competitive, Poland will need to continue investing in its human capital.”
The EBRD invested a record €1.43 billion in 49 projects in 2024; so far this year, it has invested another €900 million, an amount that is expected to rise, reflecting the bank’s countercyclical investment approach
“Whenever there’s a funding gap, as during market volatility, we move to fill it,” says Moraru.
The EBRD’s broad investment portfolio reflects Poland’s increasing economic diversity, with a major presence in the EBRD’s portfolio—often alongside the country’s liquid and dynamic commercial banks—in the corporate sector, pharma, manufacturing, and telecoms.
Perhaps its most consistent focus, however, is energy. Some 70% of the EBRD’s 2024 investments went to support decarbonization through renewable projects and other clean-energy initiatives in an economy that is still heavily coal dependent for electricity. Projects include Poland’s first offshore wind farm, to which the bank committed €140 million and which is expected to provide some 3% of Poland’s electric power, and the innovative Bioelektra municipal waste processing plant in Wierzbica, to which the bank has committed €17 million. Green bonds are an additional focus. Between 2023 and 2025, the EBRD has invested in five such offerings by Polish banking clients alongside one sustainability bond.
Six Pillars to Prosperity
In a speech before the Warsaw Stock Exchange before the presidential election, Tusk insisted that 2025 would be a “long-awaited year of the positive,” suggesting that investments in FDI and Greenfield will exceed PLN650 billion ($175 billion), perhaps reaching as high as PLN700 billion ($189 billion), fueled by EU funds from grants and loans. Saying he wanted a “strong, modern, and prosperous Poland,” he identified six pillars to achieving this: investment in science, energy transformation, development of new technologies, development of ports and railway modernization, a dynamic capital market, and business support and deregulation.
Key changes in government, announced after Tusk won a parliamentary confidence vote following the presidential elections, reflect his priorities. Establishment of a new energy ministry was announced a few weeks after Poland ended all purchases of Russian fossil fuels, which in 2015 still accounted for 84% of energy consumption. Tusk has confirmed that Poland is pressing ahead with a wave of new renewables projects and that first-phase ground studies have been completed for Poland’s first nuclear power station, with Bechtel and Westinghouse leading the construction and commissioning of the first unit scheduled for 2033.
Among the challenges Finance Minister Domański faces are bringing Poland’s fiscal deficit under control and stabilizing government debt in the medium term. From 2021 to 2024, the budget deficit rose from 1.7% to 6.6% of GDP, fueled by expenditures on pensions, infrastructure, and defense. Relative to GDP, Poland already spends more on its military than any other NATO country: 2% in 2021 against a rise to 5% in the medium term.
In addition, a large portion of future defense spending is slated to be done off-budget and financed through off-budget issuance, a practice that started during Covid and is expected to reach some 13% of GDP by 2028. The practice is accounted for in general government debt, helping to maintain fiscal transparency.
With the government targeting a general government deficit of 6.3% of GDP this year in its most recent progress report, reducing the shortfall is viewed as necessary if Poland is to maintain long-term economic credibility in the eyes of foreign investments and lenders and control rising debt service costs. But the going could be tough.
“The biggest challenge is having to implement fiscal consolidation in an environment not conducive to it, with global growth slowing, a continuing risk of tariffs, and high geopolitical and security risks,” Trajkovic observes.
Another challenge is the business environment. In Transparency International’s 2025 Corruption Perceptions Index, Poland dropped to 53 out of 180 countries, alongside Georgia, compared to 2016, when it ranked better at 29. The current government blames the slide on the previous Law and Justice government, which weakened judicial independence, transparency in government contracts, and judicial independence. Tusk has promised reforms, but warns this will take time, especially with President Nawrocki holding veto power.
For the moment, however, the data are looking up. “On the positive side, by almost any metric, including FDI inflows, inflation, and overall growth prospects, Poland’s diversified, resilient economy is in good shape,” Trajkovic argues.
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