FDI bouncing back
After three years of sluggish investment, foreign companies seem to be regaining an interest in the Polish market. Analysts believe foreign direct investment (FDI) to Poland for 2004 could reach as much as $8 (zł.24.54) billion-that's nearly $1.58 (zł.4.85) billion more than the previous year.
Development and logistics firms are leading the way. Katowice recorded the biggest single investment-zł.2.4 billion from Hungarian developer TriGranit Development, which plans to construct a commercial and entertainment center there. Logistics firm Parkridge CE Developments, with partner Morley Fund Management, reported plans to inject zł.797.54 million near Piotrkowa Trybunalska to build a logistics center.
Poland also proved attractive to international juggernauts such as Whirlpool, who invested zł.484.72 million, Gillette (zł.472.45 million), and Carrefour (zł.438.75 million). Low labor costs and Poland's central location mean many foreign firms are creating international service centers here. Hewlett Packard (Poznań or Wrocław) and Phillips (Łódź) both plan to build such facilities.
Jeff Anderson, an Eastern European specialist at the Institute for International Finance, says: "Cost pressures put on businesses, due to the value of the euro vis-a-vis the dollar, means companies are moving production, as well as service centers, to places like Poland, where the labor costs are more favorable."
However, most agree that FDI in Poland isn't what it could be. The growing political and military alliance with the U.S. hasn't translated into a growing American investment. Hyundai's scorning of Poland last year to build a small-car factory in Slovakia shows where Poland needs improvement.
"The whole regulatory structure in Poland could give businesses pause. The labor markets are not fully flexible. When regulations mean businesses are allowed to scale operations up but not down in a country, they think twice about moving there," says Anderson.
After the heady days of the dotcom boom, FDI in Poland dropped significantly from $10.6 (zł.32.51) billion in 2000 to $7.14 (zł.21.9) billion in 2001 and again to $6.06 (zł.18.59) billion in 2002. The number jumped slightly by $360 (zł.1,104) million in 2003 to $6.42 (zł.19.7) billion. Analysts believe last year's numbers signal the beginning of an extended period of rising foreign investment.
"FDI in Poland is set to continue increasing. Poland is a large, important market, and those investors producing goods for domestic markets will really begin to look at Poland," says Anderson.
Development and logistics firms are leading the way. Katowice recorded the biggest single investment-zł.2.4 billion from Hungarian developer TriGranit Development, which plans to construct a commercial and entertainment center there. Logistics firm Parkridge CE Developments, with partner Morley Fund Management, reported plans to inject zł.797.54 million near Piotrkowa Trybunalska to build a logistics center.
Poland also proved attractive to international juggernauts such as Whirlpool, who invested zł.484.72 million, Gillette (zł.472.45 million), and Carrefour (zł.438.75 million). Low labor costs and Poland's central location mean many foreign firms are creating international service centers here. Hewlett Packard (Poznań or Wrocław) and Phillips (Łódź) both plan to build such facilities.
Jeff Anderson, an Eastern European specialist at the Institute for International Finance, says: "Cost pressures put on businesses, due to the value of the euro vis-a-vis the dollar, means companies are moving production, as well as service centers, to places like Poland, where the labor costs are more favorable."
However, most agree that FDI in Poland isn't what it could be. The growing political and military alliance with the U.S. hasn't translated into a growing American investment. Hyundai's scorning of Poland last year to build a small-car factory in Slovakia shows where Poland needs improvement.
"The whole regulatory structure in Poland could give businesses pause. The labor markets are not fully flexible. When regulations mean businesses are allowed to scale operations up but not down in a country, they think twice about moving there," says Anderson.
After the heady days of the dotcom boom, FDI in Poland dropped significantly from $10.6 (zł.32.51) billion in 2000 to $7.14 (zł.21.9) billion in 2001 and again to $6.06 (zł.18.59) billion in 2002. The number jumped slightly by $360 (zł.1,104) million in 2003 to $6.42 (zł.19.7) billion. Analysts believe last year's numbers signal the beginning of an extended period of rising foreign investment.
"FDI in Poland is set to continue increasing. Poland is a large, important market, and those investors producing goods for domestic markets will really begin to look at Poland," says Anderson.
