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Crisis finally catches up with Poland

Monday, August 05, 2013 - 01:38

Aug. 05- Roman Markowski's shoe-selling business mirrors the fortunes of Poland's economy over the past 20 years: built in the wreckage of communism, it prospered through years of hearty consumer spending and now the slowdown has left it in deep trouble. Edward Baran reports.

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After 20 years Roman Marowski's chain of 29 shoe shops in Poland is closing down. Up to 170 people will lose their jobs. SOUNDBITE: Shop Owner, Roman Markowski, saying (Polish): "The economic slowdown has hit hard - the retail brand I've built over two decades is now bankrupt. It started in 2009 when banks cut the number of loans and began to watch the finances of companies like mine." Roman's story is increasingly common One insurance firm is predicting a 22 per cent rise in the number of bankruptcies. Piotr Bielski is a senior economist at Zachodni WBK Bank. SOUNDBITE:Senior Economist, Piotr Bielski, saying (Polish): "At the beginning of 2012 the Polish economy was barely growing - just half a percent a year. For Poland that was a big slowdown, but there's still hope that the worst has passed and in the coming quarters we will see higher growth." Poland's economy is the sixth biggest in the EU. It was relatively unscathed by the economic crisis of 2008 until last year when consumers appear of have lost confidence. In May retail sales growth was just half a per cent year on year With the country relying on household consumption for 60 percent of its GDP that hit the economy hard. <60 per cent of GDP> SOUNDBITE: Warsaw Resident, Marta Szymkowiak, saying (Polish): "This year has been especially bad for me and my finances. If we're talking about an economic crisis, I can definitely feel it." SOUNDBITE: Warsaw Resident, Milena Bazyl, saying (Polish): "I can't afford any luxuries any more, I holiday at home and eat out less." Roman blames the banks for his failing business - they weren't willing to lend in his hour of need. He now fears others may follow in his footsteps if consumer confidence isn't restored.

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Crisis finally catches up with Poland

Monday, August 05, 2013 - 01:38