Economic environment
Poland’s current economic landscape was shaped by the recent past. The late-1980s demise of the Soviet Union enabled restructuring and liberalization that now support sustainable, consumer-led growth. The European Union accepted the country as a member in 2004, enabling large inflows of foreign direct investment that fueled industrial development. Today, transport equipment and industrial machinery account for 40% of Polish exports. German auto manufacturers are bug buyers of Polish goods, as are companies in France and the United Kingdom.
EU investment funds contributed 3% of Poland’s annual gross domestic product between 2007 and 2015. This helped incomes rise more quickly than in other economies in Central and Eastern Europe. Low unemployment continues to boost incomes, which rose more than 3% over the past year. Consumer confidence is at a record high; consumer spending grew nearly 5% during the last 12 months for which data is available.
Poland is enjoying economic momentum. After growing 2.7% in 2016, GDP is on track to expand by 3.9% in 2017. Growth is projected to slow to 3.2% in 2018, as consumer spending wanes, and Oxford Economics predicts expansion of about 3% per year through 2020.
Travel
International travel to and from Poland has grown an average of 5% per year since 2010. It’s expected to grow a more modest 4.4% through 2020. The U.K., Russia and Italy, respectively, are the most popular destinations for Polish travelers. In 2016, each country accounted for around 10% of departures. Uncertainty surrounding the U.K.’s exit from the European Union is changing that dynamic. Russia is likely to become the top destination for Poles, netting about 14% of departures by 2020.
Germany is by far Poland’s most important source of inbound travel, with an unrivaled 26% share of trips in 2016. But by 2020, this figure is projected to fall below 20%. Meanwhile, inbound travel from the U.S. is expected to make up 7% of arrivals by 2020, meaning it will be the second-largest inbound market, just ahead of the U.K.
Poland’s business travel market was worth more than US$4 billion in 2016. Domestic travel accounted for around one-fifth of spending, with the balance evenly split between inbound and outbound travel. After averaging almost 8% growth per year between 2010 and 2016, spending on business trips is likely to slip below 6% annually through 2020.
Air
LOT Polish Airlines is Warsaw’s largest airline, but it faces strong competition across the rest of the country from low-cost carriers like Ryanair and Wizz Air. Those airlines are playing an important role in developing services from secondary cities.
For the past few years, LOT’s response to low-cost carrier expansion was curbed by EU capacity restrictions. But those restrictions have ended, and LOT is starting short-haul services from Warsaw to Astana, Kazakhstan; Kaliningrad, Russia; Stuttgart, Germany; Tel Aviv, Israel; and other destinations. LOT is expanding long-haul operations, too, with service from Warsaw to Los Angeles and Newark, New Jersey, and from Krakow to Chicago—routes that accommodate growing demand from U.S. travelers.
Accommodation
Since joining the EU, Poland has worked hard to match the economic growth and living standards of other member states. The country’s progress boosted tourism and business travel, and hotel chains responded by investing heavily. Between 2007 and 2016, the number of chain hotel rooms in Poland almost doubled to 44,000.
AccorHotels is the largest chain in the Polish market; its portfolio of 71 properties covers all main service levels except upper upscale. That high-end category is covered by Marriott, which has six upper-upscale hotels, and Carlson Rezidor and local operator Diament Hotels, each of which have seven hotels in the category.
International chains make up just 7% of all properties. Diament, Polish Prestige Hotels & Resorts, WAM Hotels Group, Focus Hotels and Qubus Hotels are local operators with properties across the country.
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