Poland, Hungary, Slovakia Will Post Faster Growth on EU Entry

Poland, Hungary, Slovakia and the Czech Republic, the four largest countries joining the European Union next year, will have the fastest economic growth in four years as EU aid and a Western European recovery boost investment and output, said executives at companies investing there. Their $460 billion combined economy, accounting for more than 80 percent of the 10 future members' gross domestic product, will grow at least 3.5 percent, compared with 3 percent in 2003, the European Commission said. Poland will probably grow the fastest of the largest four largest countries, at 4.2 percent. Polish car-parts maker Stomil Sanok SA and the Czech and Slovak units of Volkswagen AG and other companies are raising production as business picks up in Western Europe, destination of more than 70 percent of the four largest entrants' exports. The first of the $50 billion in EU aid pledged through 2006 will also become available. ``The new members will benefit in particular from the emerging recovery'' in Western Europe, said Michael Heise, chief economist for Allianz AG, Europe's No. 1 insurer that has a combined 11 percent market share in eight Central and Eastern European countries. ``Foreign direct investment will remain high after enlargement. The contribution of the EU budget to the acceding countries will also be an impetus for growth.'' The new members are outpacing Western Europe as they play catch-up after decades of communism and almost 15 years of developing functional market economies. Gross domestic product per person is about 6,000 euros ($7,455) on average in the largest four, a quarter of the EU average.