The difference between Ukraine's and Poland's GDP
As somebody who grew up in Ukraine and saw its development from the inside, the Polish economy was always an interesting case for me.
At the end of the USSR in 1991, both countries had the same GDP. However, after 30 years, the gap is incomparable in all areas of the economy.
I know and have worked with many Polish people and, of course, traveled to Poland. I made a lot of observations, but there is no simple explanation for me.
If I were to speculate:
- Poland had greater institutional continuity overall. Ukraine started almost from zero in 1991.
- Poland wasn’t a part of the USSR, although, it was a strictly USSR-controlled state (satellite). Damage by the USSR was high but lower than that in Ukraine. Poland had small businesses and since 1989 regained full political sovereignty.
- Building closer ties with Europe and maintained caution towards Russia. While Ukraine kept balancing between Russia and Europe.
- Which led to investments in Poland by EU. Ukraine didn’t get such money investments.
- Early reforms and complete liberation of prices after the fall of the communist bloc. In Ukraine, it took much longer.
- Poland achieved bigger gains on corruption indices. While Ukraine also fought it, but less successfully. It struggled to reduce oligarchic influence.
- The Polish economy was reoriented to manufacturing and later technologies. While Ukraine kept focus on commodities.
- The war with Russia since 2014 had a huge negative impact on the Ukrainian economy.
As one of my friends suggested, it is probably more correct to compare Poland to Hungary, Czechia, and Slovakia.