The coronavirus (COVID-19) crisis has hit the economy and society hard. The pandemic occurred after a long expansion of living standards when unemployment and poverty rates had fallen to historically low levels (). Early containment measures have limited contagion in the first part of 2020. Though production and consumption rebounded quickly after their easing until September, a new rise of infections led to renewed restrictions in October.

Poland has experienced strong economic growth over the past two decades. It has been very successful in integrating into global trade, not least thanks to its increasing role as an outsourcing destination for business services. The catch-up with average living standards in other OECD countries and regional peers has continued (). Until the outbreak of the coronavirus, rising household incomes had contributed to more inclusive economic development, while poverty rates, inequality and the unemployment rate had declined ().

The rapid internationalisation of the Polish economy has helped develop competitive export-led manufacturing and services sectors fostering robust growth and productivity performance. However, the benefits of this development have been unequal. Many small and medium-sized enterprises (SMEs), some regions and social groups have lagged behind. Poland’s integration into world trade has largely focussed on downstream activities of value chains and relatively labour-intensive products that incorporate little domestic value added. The coronavirus (COVID-19) crisis has put additional pressures on SMEs. A broad range of well-coordinated policies is required to boost SMEs’ internationalisation and their productivity, while easing labour reallocation during the ongoing recovery. Providing stronger support for training programmes in smaller firms and within small firms’ networks would help them upgrade the skills of their workforce, notably for their managers, and ease new technology adoption and internationalisation. Streamlining regulations on start-ups and limiting regulatory and tax barriers to firm expansion would raise firm entry and growth. Strengthening post-insolvency second chance policies for honest entrepreneurs would ease resource reallocation and the adaptation of SMEs to an uncertain and rapidly changing international environment. Improving transport and digital infrastructure would lower trade costs and raise productivity. Ensuring that innovation policies adapt to smaller firms would boost their innovativeness and ease their integration in national and international value chains.