Assessment of the Impact of the National Development Plan 2004-2006 on the Economy by Means of the HERMIN Model
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Publication date: 2003-07-25
GNPJE 2003;185(7-8):18-46
Poland’s potential accession to the European Union has necessitated a preparation and presentation to the European Commission of the National Development Plan (NDP) 2004-2006 - the primary document programming the use of structural funds in Poland within the framework of implementation of the EU cohesion policy. Presentation of ex-ante assessment of the macroeconomic effect of NDP realisation on the economy is an integral part of the programming document. For this reason, a Polish implementation of the macroeconomic HERMIN model has been developed. This model was, for the mentioned purposes, applied to European Union areas subject to the cohesion policy, i.e. to Ireland, Portugal, Spain, Greece and to eastern Lands (Lander) of Germany. At present, it has also been prepared for application to the candidate countries, such as the Czech Republic, Latvia, Estonia or Slovenia. The study briefly characterises the theoretical foundations of the HERMIN model and its Polish implementation to the ex-ante assessment of the impact of Poland’s National Development Plan (NDP) 2004-2006 realization on the Polish economy. Consequently, analyses of financial transfers associated with NDP realisation were carried out, taking into account both their breakdown into specific years of the 2004-2009 period, and their breakdown into three major categories: investment in infrastructure, investment in human capital and support for enterprise development. On this basis, simulations for the period up to 2010 were made for two alternative scenarios: the first - assuming Poland’s accession to the EU on 1 May 2004 and implementation of the NDP 2004-2006 and, the second - assuming Poland’s staying outside the EU structure and no implementation of the NDP. The results have been presented as a differential between these two scenarios for such parameters as: GDP growth, unemployment level, production and productivity in the analysed sectors of the economy, i.e. manufacturing, services, agriculture and the public sector, the public sector deficit, consumption, prices and wages. The results are shown as an effect caused exclusively by the EU structural funds, and jointly by the EU funds and Polish public funds within the NDP 2004-2006. Additionally, results of simulations are presented for continued EU support in the years 2007-2013 in the form of another NDP with an annual average support level of 2% and 2.5% of GDP. The results of simulation have been supplemented with an analysis of sensitivity to deviation from the adopted assumptions. At the same time, the study indicates directions for further efforts towards the model’s improvement and its extension into the economies of particular regions of Poland as instruments for analysing the problems involved with regional development, which have to be solved with support o EU Structural Funds, as well as national cofinancing of the public and private sectors.
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