Public aid related to Covid-19: the Polish state and the competitiveness of companies after the crisis

Local governments for legitimate reasons prepare heavy artillery to help companies get through this period. This unprecedented situation is of course necessary for the company to survive on the market the pandemic period.

However, as we are all acting in an open economy, the absence of common European approach and the imbalance between the states concerning the level of granted public aids will create a dangerous inequality in the competitiveness of businesses at the end of the crisis.

Those who will come out in better shape during this period because they have benefited from sufficient public aid will win the markets and will take place of those who will come out very weak ...

The Polish state, which has been very responsive to health measures, should not underestimate the economic consequences of these measures for the Polish economy. Now, in the moment of the intense parliament works related to anti-crisis economic shield, this is key to ensure that the entrepreneurs in Poland will be able to prepare the post Covid-19 period and face the international competition in the best conditions. Delaying the new retail tax is a good first step in the right direction, but broader fiscal measures (such as income support schemes, labour law reforms, cutting social payments for some time rather than just deferring them) are also strongly needed.

With a public debt representing only 48.9% of its GDP, Poland is currently in a relatively comfortable situation compared to most EU countries.

Larger fiscal stimulus and rescue packages comparable to the ones proposed by France or Germany are possible and expected by the Polish firms. This is a prerequisite to ensure that they will remain competitive and in satisfactory financial shape once the sanitary situation will go back to normal.