At the end of the first half of 2012 Poland's public debt amounted to zł.842.6 billion, the Finance Ministry announced. That's 3.3 percent (zł.27.3 billion) more than at the beginning of the year and 7.2 percent more than a year ago.

According to economists, a public debt of zł.842.6 billion is still below 55 percent of GDP, which is a constitutional threshold.

“There is a possibility that at the end of the year we will find ourselves balancing dangerously on the border,” former Finance Minister Mirosław Gronicki told Parkiet.

A lot depends on how the economic situation develops, and especially on how much the economy slows down by the end of 2012. “Nominal GDP will most likely be lower than the zł.1.612 billion planned by the government, which means that it will be more difficult to stay within the limit,” said Janusz Jankowiak, chief economist at the Polish Business Council.

Crossing the 55 percent limit means emergency measures would have to be enacted to reduce the debt.

By the end of the year the public finance sector deficit will certainly be higher, though. Currently the government estimates the deficit at zł.31.7 billion, giving up on the zł.26.8 billion it predicted in June.

“In this situation it is important how the government is planning to finance the deficit. If it is going to actively obtain funds from the sale of assets then we may avoid problems,” said Mr Gronicki.

Much also depends on the exchange rate of the złoty, since a lot of Poland's debt is denominated in foreign currencies and will need to be paid off using the Polish currency.

Poland A.M.