Polish Presidential Election: Conservative Comeback and Institutional Uncertainty
A Pivotal Election in Post-PiS Poland
Poland’s recent political history has been defined by eight years of national-conservative Law and Justice (PiS) government (2015–2023) under Prime Minister Mateusz Morawiecki and President Andrzej Duda. The PiS administration implemented sweeping changes, many of them illiberal, overhauling the judiciary, expanding state media control, enacting a near-total abortion ban, and adopting aggressive family-welfare spending. This put Poland at odds with the EU. Brussels froze over €100 billion in EU funds in 2022 due to rule-of-law and judicial independence concerns. In October 2023, the long-ruling PiS coalition lost the parliamentary elections, and Donald Tusk (former PM and European Council President) returned to power heading a broad centrist coalition. Tusk’s government quickly moved to reverse some PiS policies and comply with EU rule-of-law demands. However, President Duda remained allied with PiS and routinely vetoed reform bills from Tusk’s coalition. Thus, similarly to Romania, at stake is not just who gets to be president but whether Poland’s effort to reestablish a system governed by the rule of law can succeed.
Candidates and Campaigns: Trzaskowski vs Nawrocki
The ruling coalition nominated Rafał Trzaskowski, the Mayor of Warsaw and leader of Civic Platform, as their presidential candidate for 2025 elections. Trzaskowski campaigned as a moderate liberal and pro-European, pledging to restore judicial checks and expand civil liberties. The opposition (PiS and its allies in the United Right) ultimately endorsed Karol Nawrocki, a historian who heads the Institute of National Remembrance and was not a career politician. Nawrocki ran on a conservative, patriotic platform, promising to protect “average Poles” (including small farmers) from EU overreach, uphold traditional Catholic values, and continue PiS’s social programs. American conservative figures even joined his campaign: at a late-May rally the US Homeland Security Secretary Kristi Noem explicitly endorsed him, praising his “strong leadership” akin to Donald Trump.
Tight Runoff Result: Nawrocki Wins Narrowly
In the first round of elections Trzaskowski had a narrow lead of 31.5% against 29.5%, however Nawrocki emerged victorious from the runoff held on June 1 with a narrow margin of 50.9% to Trzaskowski’s 49.1%. Official turnout was about 71.3%, the highest for any Polish second-round presidential election. Nawrocki’s victory reflected Poland’s geographic and demographic divides. Trzaskowski narrowly led in big cities (Warsaw, Krakow, Gdansk etc.), but Nawrocki won most of the rural and conservative regions.
A New Era of Legislative Gridlock?
As Poland’s president, Nawrocki will have limited day-to-day power, but the presidency carries an important veto power and influence over appointments. Nawrocki is likely to use his veto extensively, creating legislative gridlock, replicating the standoff seen under Duda. One immediate consequence is that judicial reforms promised by the Tusk government will probably stall again. During the PiS years, controversial reforms had placed the judiciary under heavy political influence, prompting EU censure. The Tusk coalition came into office vowing to reverse those changes. However, the president must sign new laws, and Duda repeatedly vetoed the reform bills. Now, Nawrocki has promised to keep PiS-appointed judges and to slow any reform of the courts. For investors, this means that rule-of-law concerns are unlikely to ease in the near term, and court-related litigation or regulatory decisions may continue to be unpredictable.
Geopolitics and the EU: A Slight Shift Away from the Core
On NATO and security, Nawrocki has affirmed Poland’s commitments, vowed to spend 2%+ of GDP on defence and continue backing Ukraine’s war effort. However, on NATO expansion Nawrocki controversially said he would not ratify Ukraine’s membership (at least not until the war ends) out of fear it could draw NATO directly into conflict. Geopolitically, Nawrocki’s presidency may nudge Poland slightly away from the EU core. Under Tusk, Poland had moved to rejoin the “Weimar triangle” with Germany and France on issues like EU enlargement and climate policy.
Fiscal Policy
Beyond policy specifics, the presidency controls key appointments (including to the Constitutional Tribunal and parts of the National Bank’s board). Nawrocki will thus influence the long-term balance of these bodies. Under PiS, Poland’s central bank had occasionally come under political pressure, raising concerns about its independence. In his campaign Nawrocki explicitly urged the central bank to cut rates to reduce the loan burden on Poles. In addition, he is likely to continue to pick central bank board members sympathetic to lower rates.
Similarly to Romania, Poland has a high budget deficit (2024: 6.6% of GDP) due largely to military spending and generous social transfers. A Nawrocki presidency makes tighter fiscal policy less likely, although Trzaskowski also promised further tax cuts and borrower relief during the campaign. The government’s own attempts to roll back some PiS tax cuts on high incomes and corporations may be vetoed. Nawrocki’s win suggests tax rates will likely remain low or be further reduced. He has talked about lowering social security contributions and other household taxes. Regardless, Poland’s sovereign credit rating is not under immediate threat. Relative to peers with comparable ratings, Poland maintains a more favourable medium-term growth trajectory, and a balanced external account. However, the limited political appetite for fiscal consolidation implies that Poland’s sovereign credit risk premium will remain elevated.
Long-Term Economic Impact: Risks to Competitiveness
From a cyclical perspective, the solid near-term growth outlook (3-3.5% in 2025-26) remains broadly intact. Economic activity is expected to be supported by resilient household consumption, underpinned by accumulated savings and recovering real incomes, as well as continued public investment, financed through both domestic sources and EU structural funds. However, in the longer perspective rising political polarization is likely to contribute to institutional uncertainty, which in turn may weigh further on private sector investment appetite. If this persists, it could undermine efforts to restore Poland’s corporate sector competitiveness, which has eroded in recent years. The cost-competitiveness of Polish firms has been hit by structurally rising labour costs exceeding productivity gains and higher energy prices. At the same time, competition from international players, particularly from China, has intensified. This environment, coupled with macro-policy un-predictability, has discouraged private investment. If political fragmentation deepens, institutional risk may rise further, exacerbating this trend. Looking ahead, Polish corporates face increasing pressure to regain ground through innovation, efficiency gains, and international market expansion. Rebuilding competitiveness will be critical to sustaining long-term economic momentum.
