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The prices in Poland are relatively low, especially as compared to other OECD members. Prices, lower that the EU average, combined with the high quality of products, are one of the main reasons for a dynamic increase in exports - especially after the trade barriers have disappeared as Poland has joined the EU. Lower production costs, notably for the EU average, are an opportunity for companies which would consider investing in Poland. Just how big are the differences? The easiest way of comparison is the Big Mac Index, calculated every year by "The Economist". Among 30 countries included in the index, Poland comes 21st (see Chart 8.1, the link is in the footnote). In the last two years, the inflation in Poland fluctuated between 3.1% in 2004 and 2.1% in 2005. The prices of products manufactured during this period did not change much either (approx. 6% between December 2003 and December 2005). This means that the prices of the majority of commodities did not rise drastically, with minor exceptions (most importantly the prices of oil and derivatives, which reflected the global trend, and increase in prices of real estate). Below, two Tables list selected goods/services and their prices in Poland (8.2 and 8.3): Table 8.1: | Price of Big Mac (in selected countries) | | Switzerland | 4.93 | | Sweden | 4.28 | | Eurozone (weighted av.) | 3.51 | | UK | 3.32 | | Turkey | 3.07 | | Hungary | 2.71 | | Japan | 2.19 | | Poland | 2.09 | | Russia | 1.60 | | China | 1.30 |
Source: The Economist, *Jan-Sep 2005 Big Mac index Jan 12th 2006 Full list of countries available at The Economist website: http://www.economist.com/markets/bigmac/
displayStory.cfm?story_id=5389856 Table 8.2 | Retail prices of selected consumer goods and services in PLN (CSO 2004 r.) | | 1 m2 of living quarters | 1 158.00* | | 1 m2 of land, developed | 34.00** | | 1 m2 of agricultural land | 1.20 | | 1 l of Eurosuper petrol | 4.42 | | Automatic car wash | 13.85 | | Train ticket, 2nd class, for 181-200 km distance | 34.03 | | Taxi fare, daytime, for 5 km distance | 12.99 | | Air fare Warsaw-Krakow | 952.30 | | Medical consultation (specialist) | 50.97 | | Electric energy for households (tariff G-11) – per 1 kWh | 0.42 | | 1 m3 of natural methane-rich gas for households | 0.42 | | CO for households - per 1 m2 of living space | 3.04 |
Source: GUS, more information (mainly in Polish, partially also in English) available at: http://www.stat.gov.pl/ *Average country price – differences between individual cases are considerable: 1 m2 of living quarters in Mazowieckie province costed PLN 2,848 and e.g. in Świętokrzyskie province only PLN 754. Prices in Warsaw are even higher than the prices in Mazowieckie province. **as above. The average highest price in Mazowieckie province - around PLN 158, while in Warmińsko-Mazurskie province - around PLN 4. Table 8.3 Average prices of food in Polish supermarkets, November 2005, in PLN:
(where the brand was not provided, the cheapest product of the category has been selected; next to it is its average price in PLN from 8 supermarkets or extremes)* | | Ground coffee 250 g | 1.86 | | Margarine 500 g | 1.39 | | Żywiec bottled water 1.5 l | 1.68 | | Boiled ham per 1 kg | 16.46 | | Oranges 1 kg | 3.76 | | 10 eggs | 3.01 | | flour 1 kg | 0.75 | | sugar 1 kg | 2.71 | | cheese 1 kg | 11.10 -15.99 | | toothpaste 125 ml | 1.79 | | Pampers nappies,** box of 64 | 44.15 – 55.99 |
Source: „Polityka” No 49 of 10 December 2005, research provided by GFK Polonia. *please note that these prices are not fully representative: Jacobs Kroenung 250 g to PLN 7.62, and Colgate Herbal 125 ml toothpaste - PLN 5.29 **Pampers Active Baby 3 Midi (4-9 kg)
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