The United States have its own reasons to be concerned about future of their economy. However recent estimates show that so-called the new economies in Central Europe, not affected by the crisis, are also in the urgent need of repair.
According to the analysts from the Bank of International Settlements the debt to GDP ratio of the major Western governments will inrease over 200 percent without the fiscal reforms. This may not be a news but this information still remains relevant.
Central Europe was supposed to be an oasis with its growing population, opening markets and the modern economy. Surprise, surprise.
The Central Europe states face the same type of the danger as the West. They are however much less developed. Their growth depends on exports and the internal market sales. Their economies are fragile and burdened with a huge debt.
The new report by the Sobieski Institute in Poland reveals that the current real the debt to GDP ratio may be is more than 200 percent.
Author of the report calculated the debt through analysis:
Analysts, who praise supposedly brilliant Polish economy are not aware of the state of the pension fund and other liabilities of Polish government.
In 90s during the restucturization of the heavy industry (coal, metal, shipbuiding etc) Polish governments permitted many workers to retire earlier. Industrial workers' unions managed to negotiate often extremely high pensions. Ten percent of the 2009 budget expense were the special pensions (of the public sector workers: defense, judicial, education etc).
According to a reliable source Polish government did not count the value of non-fiscal liabilities such as for instance the cost of medical services or the public transportation for pensioners. But these services are part of the special pensions' package.
Therefore even this estimate may not give a full picture. However it is the first attempt to estimate real debt of Polish government by the analysts from the private institution.
Here is this calculation:
the official debt + the estimated deficit
of the state's pension fund - 598401.6 + 1363897.9
+
the Fund of the Demographic Reserve - 50000
+
the cost of the special pensions
(for the public sector workers) - 273347,1 = 208,2 %
+
the cost of the farmers' pension fund
(KRUS) - 370 725,0
+
the cost of the bridged pensions 46638, 4
___________________________________________________________________
__________________
PKB 1271700, 0
The debt to GDP ratio is already 208,2 percent - four times higher than the official debt of the Polish government (47 percent).
But for the careful observers it should not be a surprise. Because in 2004 the fiscal imbalance of the Polish government was not a small.
According to the analysts from the Bank of International Settlements the debt to GDP ratio of the major Western governments will inrease over 200 percent without the fiscal reforms. This may not be a news but this information still remains relevant.
Central Europe was supposed to be an oasis with its growing population, opening markets and the modern economy. Surprise, surprise.
The Central Europe states face the same type of the danger as the West. They are however much less developed. Their growth depends on exports and the internal market sales. Their economies are fragile and burdened with a huge debt.
The new report by the Sobieski Institute in Poland reveals that the current real the debt to GDP ratio may be is more than 200 percent.
Author of the report calculated the debt through analysis:
- an official debt,
- projected debt of the state's pension fund,
- the debt of the farmers' pension fund (KRUS),
- the future costs of the special pensions (for the public sector workers),
- the cost of the bridged pensions (for the pre-retirement period of about 2-5 years). This is not an easy problem as the below graph shows.
Analysts, who praise supposedly brilliant Polish economy are not aware of the state of the pension fund and other liabilities of Polish government.
In 90s during the restucturization of the heavy industry (coal, metal, shipbuiding etc) Polish governments permitted many workers to retire earlier. Industrial workers' unions managed to negotiate often extremely high pensions. Ten percent of the 2009 budget expense were the special pensions (of the public sector workers: defense, judicial, education etc).
According to a reliable source Polish government did not count the value of non-fiscal liabilities such as for instance the cost of medical services or the public transportation for pensioners. But these services are part of the special pensions' package.
Therefore even this estimate may not give a full picture. However it is the first attempt to estimate real debt of Polish government by the analysts from the private institution.
Here is this calculation:
the official debt + the estimated deficit
of the state's pension fund - 598401.6 + 1363897.9
+
the Fund of the Demographic Reserve - 50000
+
the cost of the special pensions
(for the public sector workers) - 273347,1 = 208,2 %
+
the cost of the farmers' pension fund
(KRUS) - 370 725,0
+
the cost of the bridged pensions 46638, 4
___________________________________________________________________
__________________
PKB 1271700, 0
The debt to GDP ratio is already 208,2 percent - four times higher than the official debt of the Polish government (47 percent).
But for the careful observers it should not be a surprise. Because in 2004 the fiscal imbalance of the Polish government was not a small.
