Economic conjuncture

The main driver of growth was private demand, clearly revived with the lifting of further COVID-19 restrictions.

Preliminary data for 2021 also indicate a significant recovery in industry resulting in increased investment and inventory levels. Inflation in Poland in 2021 is estimated to be around 5.2% (3.7% a year ago) mainly due to rising prices of services and food.

2021 in the Polish construction sector was marked by a moderate downturn in investment activity in the public segment (i.e. in the transport infrastructure segment and in local governments), which clearly lagged behind construction activity in the private segment (i.e. in the residential, industrial and logistics property segments; investment stagnation still persisted in the office segment).

Inflation is estimated to remain high, especially in Q1 2022. For the year as a whole, it is assumed to be around 6.8%. A significant factor adding uncertainty to any 2022 forecast is the war in Ukraine. As of today, there are no reliable forecasts and analyses to clearly assess the impact of hostilities on the economy in 2022.

We are currently in a transition period between successive EU budgets (i.e. the EU budgets for 2014-2020 and 2021-2027) and the release of funds from the National Reconstruction Plan (KPO) is being delayed for political reasons. This is one of the reasons why the scale of new road, energy and local government projects is expected to increase between 2023 and 2024.

China’s construction sector is showing signs of a deeper slowdown, which could contribute to falling prices of basic raw materials such as aluminium and copper. It is important to bear in mind that high demand for construction services, high energy prices, increasing wage pressure, labour shortages and the rising costs of the climate transition for manufacturers will continue in 2022, which will have a direct impact on rising prices of project implementation. The loosening of restrictions related to the COVID-19 pandemic has contributed to an economic recovery and increased demand, which in turn has increased prices of raw materials and construction materials and problems with their availability.