Country Economic Memorandum

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Poland Country Economic Memorandum: The Green Transformation in Poland – Opportunities and Challenges for Economic Growth

2022, World Bank

Poland’s economic development story is one of success: since the early 1990s, the country has transitioned to a market economy, integrated into the European Union economy and global supply chains and sustained robust growth, avoiding the middle-income trap and increasing the resilience of its economy. Poland has sustained strong growth over the past three decades, making substantial advances in converging towards the European Union (EU-27) average per capita income, although there is still a considerable gap in both productivity and income convergence when compared with aspirational peers. Poland successfully transitioned to an EU-integrated market economy, moving from upper middle-income to high-income status in less than a decade and a half. Its economy underwent a deep structural transformation, supported by cost-competitiveness, and is now well-diversified and more resilient to shocks. Long-term growth has been supported by increased total factor productivity (TFP), grounded in efficiency gains, although capital accumulation has remained the main contributor to growth. While capital deepening did occur, investments in Information Communication and Technology (ICT) and in intangible assets that have high growth potential lagged those of peers. A skilled labor force has contributed more to growth in the case of Poland than it did in peer countries. The COVID-19 pandemic, however, has resulted in important learning losses, as observed throughout the world, and together with reversals in education reforms in recent years could weigh down on labor quality and productivity in the future.COVID-19

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Albania Country Economic Memorandum: Strengthening the Sustainability of Albania’s Growth Model

2021-09, World Bank

Albania is gradually emerging from the unprecedented economic disruptions caused by the coronavirus disease 2019 (COVID-19) pandemic. As the pandemic is overcome, it is crucial to shift attention back to Albania’s long-term objective of building a stronger underlying economic growth model. This country economic memorandum (CEM) highlights 4 key priorities to help Albania identify the next steps in its structural reform agenda. Albania needs to refocus attention on the pre-crisis reform agenda and accelerate long-term economic growth, including by spurring productivity growth, building human capital, and supporting investment. On the labor supply side, this means investing in people and supporting workers’ transition to better employment (Priority 1), while on the labor demand side, this means accelerating firm productivity growth and creating better job opportunities (Priority 2). But Albania should also use the current crisis to set its aspirations higher. Beyond achieving higher economic growth, policymakers need to strengthen the quality of the country’s socioeconomic development model. Through more green, resilient, and inclusive development (GRID), Albania can ensure the sustainability of economic growth (Priority 3). Foundationally, this CEM highlights the need for Albania to create fiscal space to support its growth priorities (Priority 4). The COVID-19 crisis has driven public debt to new heights, and upgrading Albania’s growth model - including by implementing many of the reforms presented in this CEM - will require further public spending.