Long before Polish plumbers turned up in the UK, long even before Lech Walesa organised a strike in the shipyards, Gdansk was where it all started. Here, as the river Vistula flows north into a slate-grey Baltic shivering under an ashen sky, is where the road to 21st-century Poland began. True, there were setbacks and many detours along the way. Poland, wedged between bigger – and often aggressive – neighbours to the east and west, has been shaped by its geography more than most countries. It was partitioned three times in the 18th century and the victim of both fascism and communism in the 20th century.

The narrow houses built in the Dutch style that line the streets of the old town are evidence of an older Poland.

Gdansk was once a member of the Hanseatic League, an alliance of merchants in the late middle ages that developed trade routes across northern Europe. Furs, timber and wheat loaded on to ships in Gdansk were exchanged for cloth and manufactured goods from Flanders and England.

Over the past 20 years, those links have been reforged. Poland is a market economy with a liberal outlook. It is a member of the European Union and would like to join the single currency. In the worst year of the global economic crisis, it had the strongest growth of any member of the rich-nation Organisation for Economic Co-operation and Development.

But statistics, like appearances, can be deceptive. Just as much of Gdansk's old town had to be painstakingly rebuilt after the devastation caused by the second world war, so economic reconstruction is tough going and a work in progress.

The drab housing developments beyond the old town bear witness to the 45 years Poland spent behind the iron curtain. Unemployment is just under 10%, the budget deficit is too high for comfort and living standards remain well below those in western Europe. Poland is the biggest recipient of cohesion funds from Brussels and needs EU money badly to fix its infrastructure. Gdansk has a spanking new deepwater container port, but the roads leading to it are single-track and full of holes.

That said, there is a determination to put things right and to get on.

"Poland was historically squeezed between Germany and Russia," said Boris Wenzel, chief executive of the container terminal, who aims to end Hamburg's domination over shipping movements in the Baltic. "Germany tries to maintain domination over Poland and the Baltic by ensuring big ships stop in Germany. We are trying to reverse that. We want to impose a model where Poland controls flows to Russia and one day to Germany. We want to affirm the geopolitical power of Poland by taking control of the sea."

It is a lofty ambition, not least because Germany is unlikely to cede its dominance easily. But in Gdansk they say that what the country lacks in physical infrastructure it can make up for in entrepreneurial zeal. Wenzel says people have the wrong impression of Poland, perhaps symbolised by Andrzej Wajda's Man of Iron, in which Walesa played himself. "There is a dynamism about the country; it has a lot of hard-working people, which are difficult to find in western Europe these days."

Miroslaw Gronicki, a former finance minister and now adviser to Poland's central bank governor, Marek Belka, says it was the hunger to succeed that helped Poland recover from the shock treatment administered in the early 1990s. "We are in better shape than the old East Germany, which relied heavily on transfers from West Germany. Here we relied on our own savings and the animal spirits of the people."

Some of those animal spirits have been lost as a result of the migration of 2 million workers westwards since the country joined the EU in 2004. Poland remains in some respects a conservative country. It has a large rural population – 15% of the workforce is employed on the land – and the Catholic church remains a significant, if waning, force.

That conservatism proved to be a strength in the years leading up to the financial crisis. Unlike their counterparts in western Europe and North America, Poland's banks did not load up on credit derivatives and the other exotic products that led to the collapse of 2007-08. Nor was Poland as dependent on credit as the former eastern bloc countries that joined the EU in 2004. Even more impressively, the authorities in Poland did not wait for the crisis to break before toughening financial regulation.

In its 2010 report on the Polish economy, the OECD noted: "While excessive borrowing in foreign currency had been actively discouraged already in 2006, the Polish Supervision Authority convinced financial firms to retain their 2008 profits in order to strengthen their capital base and reinforced the supervision of both banks' balance sheets and their funding links with foreign parents."

Jake Jephcott, an ex-pat Brit running a green tech company, said: "The banking system helped. It was more difficult to get credit at a time when it was so easily available in the UK. That helped them battle against economic depression. Poland is a poor country. It still has a peasant class, but I see a lot of nice cars on the streets, clothes are more expensive than in London and everyone has nice phones."

Jephcott aptly sums up Poland's mix of old and new. In Gdansk, the shipyards are still there, but after going bust in the 1990s they now specialise in niche products: wind turbines, luxury yachts and vessels that service the offshore industries. The church remains a force but is under threat from the new religion of western consumerism, seen in the US-style strip developments with their Porsche dealerships, Ikea sheds and drive-through KFCs. Poland remains an attractive low-cost location for western multinationals, but has a growing presence in up-market sectors such as bio-technology, electronics and computer software.

It is these hi-tech companies that the country is keen to see develop: firms such as Invicta, which provides specialised diagnostic fertility treatment, and Vector, started by a husband and wife team in a garage in the dying days of communism, which employs 300 people making amplifiers for the satellite TV industry.

Ivona, a company founded by Lukasz Osowski at Gdansk University 10 years ago, has developed innovative ways of turning text into speech for books, text messages and computer tablets. The use of automatic algorithms has been so successful that Ivona has won a two-year contract to provide software for the Royal National Institute of Blind People. "We have had offers for our business," Osowski says, "but we said no. We like what we are doing."

Over the next few years, Poland faces three big challenges.

The first is to deal with the legacy of the recession – a big current account deficit and a black hole in its public finances. Neil Shearing, emerging markets analyst at Capital Economics, said it was becoming increasingly clear that Poland must tackle its twin deficit problem "if it is to retain its position as central Europe's star performer".

Dariusz Filar, a former member of the National Bank of Poland's monetary policy committee and now an adviser to the prime minister, Donald Tusk, said tax cuts, lower pension contributions, and a big fall in the exchange rate of the zloty all helped Poland escape recession in 2009. The first two factors helped boost consumer spending then at the expense of a budget headache today. The third helped make Polish exports more competitive but meant plans to join the single currency had to be put on ice.

Inflation is 3.6% and likely to go higher. Filar says there is a case for a modest increase in interest rates but nothing too drastic. "We need gentle or delicate moves," he says, noting that borrowing costs have already been raised once by 0.25 points. "One more move, maybe two should do it," he said.

The second challenge is to find a way of continuing to upgrade infrastructure when the government is tightening its belt and when funds from the EU – currently worth more than 3% of GDP – become less freely available. There is a frantic rush to make the country look presentable by next summer when football fans from across the continent will arrive for Euro 2012, co-hosted with Ukraine, but there will still be much to do in the years after that. Gronicki said the country had to find better ways of harnessing the private sector for infrastructure projects.

Finally, there is the question of membership of the single currency, which has been put on ice after the sharp depreciation in the zloty in 2007-08. Filar said a wait-and-see approach to euro membership was sensible.

"We need to wait for stability in the euro zone and put our own economy in order," he said. "That will take at least three or four years."

Gronicki agreed. "Joining the euro is unthinkable now. We have to be very careful. We are going to be looking at it from a distance."

But Poles are patient people who have learned how to take the long view. At the Gdansk container port Julian Skelnik, the marketing and development director, looked out at the goods being shipped by the Danish company Maersk and said: "The port of Gdansk was founded by the Danish Vikings 1,300 years ago and is the oldest enterprise in Poland. It started with long Danish boats and now they are back."