The hardest work is done, but progress requires more
Innovation, fewer bureaucratic procedures and enhanced cooperation between universities and business are among some of the factors that make Poland more attractive to foreign investors. This is according to the panelists of The Investing in Poland conference. A hard-working and well-educated labor force continues to be the strongest asset of the Polish economy, on the other hand, as the panel concluded, the lack of predictability regarding the banking system is the biggest threat to foreign capital. For the seventh year running, the journalists at the Warsaw Business Journal Group have been researching Poland’s investment climate in the Investing in Poland annual which was presented during the event.
The conference took place on October 23 at the Amber Room restaurant in Warsaw, with over 100 experts and businesspeople gathering from all over the country. Editor-in-Chief of Warsaw Business Journal Group, Jacek Ciesnowski alongside four panelists: Ewa Fudali-Bondel, Head of the City Development, the City Hall of Dąbrowa Górnicza; Maciej Górski, Adviser to the President of the Board of Managers at PAIiIZ; Michael Dembiński, Chief Advisor, British-Polish Chamber of Commerce and Thomas Urbańczyk, Head of Legal Department, German Polish Chamber of Industry and Commerce (AHK) came together to discuss investment opportunities in Poland.
Firstly, the panelists compared the investment climate in Poland’s early days after economic transition with the present situation. All of them agreed that the country has made huge progress and it has ceased to be considered as the ‘Wild East,’ as Urbańczyk pointed out. However, there is still much room for improvement regarding infrastructure.
When it comes to significant barriers for foreign investors, the numerous strict bureaucratic procedures tend to deter Anglo-Saxon companies from entering the Polish market more than anything else. “If Poland wants to attract more investors from Anglo-Sas countries, it needs to fight bureaucracy. Regulations need to be reformed,” Dembiński said, stressing that time, not money is vital when an investor decides to start a business. Górski from PAIiIZ was more optimistic about the Polish legal system and pointed out that political, economic and currency stability are at the forefront of foreign investors’ interests. Fudali-Bondel supported Górski’s point of view, saying that local offices treat every investor with due care and attention and provide them with detailed information. She concluded that “if companies feel comfortable in a particular place, they will invest in other sectors,” no matter what procedures they have to deal with, as ArcelorMittal did in Dąbrowa Górnicza, for example, when launching its shared service center.
All four debaters acknowledged the foreign languages skills of Polish graduates and professionals. German firms are particularly impressed by their technical skills, Urbańczyk pointed out. Yet, again, the representative of the British-Polish Chamber of Commerce was the most skeptical, especially about higher education regarding humanities. In addition, the expert from the AHK identified inadequate cooperation between academic centers and the Polish business sector as a weak point.
Furthermore, Dembiński posed a very important question concerning the nature of the Polish economy. He expressed doubt on whether it is becoming “a perfect example of an operational economy,” instead of a strategic one, as the constant lack of innovation hinders the development of Poland.
The last issue up for discussion was related to the possibility of the Polish government repealing the idea of special economic zones in the future. The panelists concluded that it is very unlikely to happen, but if it does, “Poland will remain to be a great location for foreign firms, and not only those which are Europe-based,” Górski pointed out, mentioning that Samsung consistently invests in its production plant in Wronki and deems Polish employees as a ideal for Korean companies. The representatives of the chambers of commerce along with Fudali-Bondel from Dąbrowa Górnicza claimed that there are numerous factors, besides tax exemptions available in the SEZs that attract investors. Górski summed up that in the long-term, Poland should be considering new interesting business partners, such as emerging Third World economies.
The audience asked about the mood of foreign investors in relation to upcoming political changes in Poland. Dembiński from the British-Polish Chamber of Commerce stressed that the unpredictability of the future in the banking sector poses the biggest threat for the Anglo-Saxon investors and their capital. Górski tried to calm British anxieties and asserted that he “cannot see any threat or cause for nervousness,” regardless of which political party rules the country, as investments are needed anyway. Urbańczyk followed up on his statement by saying that Polish-German cooperation is to be continued. Another question touched upon the issue that such investments and BPO centers are relatively easy to withdraw than production projects and the repercussions of what that means to employees. Dembiński replied that it is not necessarily the truth, because Polish centers offer a labor force with excellent language skills. Górski added that possible threats affect both sectors and it is quite easy to lower production output, and thus, employment.
After the debate, the Investment of the Year awards, and two other distinctions were presented.
Volkswagen Polska was awarded with the Big Investment of the Year, for the construction of the Białożyce production plant, near Września (Wielkopolskie voivodship), worth €800 million. The award was accepted by the company’s spokeswoman, Dagmara Prystacka. The Medium Investment was presented to Michelin Polska, for the expansion of its factory in Oświęcim (małopolskie voivodship), valued at €100 million. The award was received by Ewa Czarnecka, Director of Public Affairs at Michelin Central North Europe. Samsung Polska was honored with the Small Investment of the Year award for establishing the R&D center in Kraków, which came in at €2 million. It was received by Lee Youngmin, CEO of Samsung R&D Europe.
Warsaw Business Journal Group also presented two awards the first of which was given to Grupa Arcus, for product innovation in IT solutions in the business sector. The second was presented to Ghelamco Poland for the responsible investor creating the urban landscape of Warsaw. On behalf of Arcus the distinction was received by CEO, Michał Czeredys. Anna Kisiel, Marketing Department Assistant accepted the award for Ghelamco Poland.
Photos by Marcin Cieśluk