The Surge in Military Spending Leaves Poland Deep in a Deficit Quagmire

According to a report by Reference News Network on September 1, the German news television channel reported on August 28 that Poland is expected to face a high budget deficit next year due to record military spending. Finance Minister Andrzej Domański announced the 2027 budget draft in Warsaw, stating that the deficit will remain at 7.1% of GDP. This figure is in line with the government's expectations for this year's deficit level. The EU's Stability and Growth Pact sets a deficit limit of 3%.

Domański said, "The expected volume of military equipment deliveries next year will reach a historic high. If we maintain the level of 2025, the deficit will be much lower."

According to this budget draft, the budget revenue for 2027 is projected to be 695 billion zlotys (approximately 185.5 billion USD), with expenditures at 977.6 billion zlotys (approximately 260.9 billion USD). Defense spending alone is expected to reach 198 billion zlotys (approximately 52.8 billion USD), accounting for more than 4.5% of GDP.

Reports indicate that since the outbreak of the Russia-Ukraine conflict, Poland has significantly increased its defense spending. Due to the excessive scale of Poland's new debt, the EU initiated an excessive deficit procedure against the country in July 2024. Analysts from ING criticized that Poland has made no progress in reducing its excessive new debt. (Translation/ Nie Litiao)