Germans keep coming

German companies registered in Poland make up the largest group of foreign investors, according to the Polish Information and Foreign Investment Agency (PAIiIZ). A similar trend can be observed on the German market where Polish SMEs represent a growing presence, the German Chamber of Industry and Commerce reports.

Data gathered by PAIiIZ shows that by the end of 2004 German investments in Poland reached $10 (zł.33.1) billion, which accounts for 13 percent of all foreign direct investment (FDI). This places Germany in fourth position among foreign investors in Poland behind France, with $ 16 (zł.53.0 billion, the Netherlands, with $11.2 (zł.37.1) billion and the US, with $10.2  (zł.33.8) billion.

Interestingly, the main investors, such as Metro AG, HypoVereinsbank, Volkswagen, Commerzbank, Siemens and Deutsche Bank, were present on the Polish market even before its accession to the EU in May 2004. Lars Bosse, general director of the German-Polish Chamber of Commerce and Industry, explains that the newcomers are mainly SMEs looking for business partners behind the eastern border. In Germany, SMEs generate over 70 percent of GDP.

Apart from special economic zones offering advantageous tax rates, Germans tend to locate their offices in the environs of Poznań, Wrocław, Szczecin, and Łódź. Warsaw keeps losing importance because of high rents and the higher level of remuneration expected by employees. According to Bosse, only physical workers are cheaper in Poland while it is much more profitable to look for bilingual, managerial staff in Germany.

In the last couple of years PAIiIZ has observed positive changes in FDI structure with a growing number of greenfield investments. These are especially important for the Polish economy as they contribute to the modernization of industry and the introduction of new technologies.

Katarzyna Dębek