Polish Foreign Trade

Foreign trade in a planned economy must be subordinated to the general strategy of development. In the early stages of Polish economic growth the choice of strategy was relatively simple. In the take-off period the average productivity of labour was low, the share of the industrial sector in total output was negligible, unemployment (together with disguised unemployment in the agricultural sector) was high and there existed a structural disequilibrium between labour resources and available capital. In those circumstances the general strategy called for accelerated industrialization and a high rate of investment. This required the creation of technical capacities for investment and an increase in social savings. The creation of technical capacity for investment entailed dependence either on domestic production of capital equipment or on imports. The strategy of internal and complex industrialization was selected. Limited export possibilities and general insufficiency of raw materials resulted in channelling of investments to primary sectors (mining, heavy industry, etc.) which are highly capital intensive, where investment has a long gestation period and where new employment is created in the long run. On the other hand, increased social savings required the preparation of a scheme for drawing surplus labour into activity. Employment was raised by various means: by creating cheap new capacities, by increasing the number of shifts, by utilizing obsolete equipment, and by a programme of intensive education and training. All this led to a centralized system of planning and an inward-looking strategy of development. Also in foreign trade detailed and central decisions determined overwhelmingly the shape of foreign trade in those early stages of growth

Business · International trade · Economic and Fiscal Studies · Globalization, Economics, and Policies · Polish socio-economic development