After the fall of communism, several different countries decided that it was time to reform both current economic and political policies. Two countries that have had major economic reforms are Poland and the Czech Republic. However, the process of that change is different, each country had a different idea of how to become a new economic power in the 1990's.

In December 1989, the new government, led by members of the labor union Solidarity, launched a reform program designed to transform Poland's economy into a free-market system. Price controls were lifted, while wage controls were imposed. State enterprises were transformed into joint-stock companies, and many were scheduled for eventual privatization or purchase by foreign investors. The restructuring of the Polish economy resulted in a massive layoff of workers and a rapid rise in unemployment. Poland's GDP declined sharply in 1990 and 1991.

Poland had relied heavily on agriculture and would have been easier to reform if its exhausted industrial regions could have been abandoned. Poland may have been the first to try a rapid, sweeping conversion, deemed by the press as "shock therapy." This conversion was to a capitalism

A few signs that show the progress of both Poland and the Czech Republic are that both are expected to become; full members of the European Union, World Bank, IMF, and World Trade Organization . Poland and the Czech Republic can now become a model to several other countries that need economic reform. The two aforementioned countries had overall success with minimal, temporary disruptions in the begging.

In the early 1990's, the post-Communist government moved quickly to convert the economy to a system based on free enterprise. A number of reform measures were adopted, including a voucher privatization plan, which gave citizens, for a low administrative fee, coupons that could later be traded for stock in companies. The voucher plan successfully transferred large parts of the economy to private ownership. By December 1994 more than 80 percent of firms in the Czech Republic were privatized or had decided on a privatization strategy. Business boomed in Prague and other cities in the mid 1990's as entrepreneurs established new companies. The government has also succeeded in re-establishing trade with the West and obtaining substantial levels of foreign investment.

After its initial decline, Poland's economy began to improve. Annual GDP increased between 1992 and 1997, when it reached $135.7 billion. Industrial production increased by about 12 percent in 1994, which, accompanied by a 2 percent drop in unemployment, represe

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