Only in July and August 2019, 204,000 Germans visited Poland. Maybe this would be a good time to invest across the eastern border?
Poland is a large EU market and the sixth largest economy in united Europe. It has more than 38 million consumers whose purchasing power is growing every year. The latest Global Best to Invest 2019 ranking leaves no doubt that Poland is a good investment destination. Warsaw maintained a very high 5th place, mainly due to the number of projects implemented and the amount of foreign direct investment. It was only overtaken by China, Germany, Great Britain and India (the ranking was drawn up by Conway Analytics, a U.S. research company, and includes investment projects worth over USD 1 million which create at least 20 new jobs and 1,000 square metres of new space).
Companies have a voice
How are foreign companies doing in Poland? This is discussed in a report prepared for the Polish Investment and Trade Agency. In 2019, 94% of surveyed companies stated that they would start doing business in Poland again. Interestingly, the survey shows that the investment climate in Poland is currently considered the best since the study started (in 2019, the 12th edition was conducted). Most respondents declare that they want to increase employment and develop their business in Poland over the next 12 months.
In addition to the large and stable Polish market, German entrepreneurs appreciate that road infrastructure in Poland is good and the distances between major cities are smaller than in Germany. Poland’s national road network and its steadily developing infrastructure provide a good gateway to markets to the east of the European Union. From here, it is easy to access not just the markets of EU Member States or Scandinavian countries, but also those of Russia, Ukraine or Belarus. Owing to its location, Poland serves as an excellent hub for exports to the East. Distribution and logistics centres of multiple global companies have operated in Poland for several years. Moreover, not just the capital and its surroundings, but also major urban agglomerations in various parts of the country, such as Kraków, the Tri-City, Greater Poland or Silesia, have huge potential.
Our capital is people
Human resources are among the greatest assets of the Polish economy. For German companies, this represents a great opportunity, since domestic forecasts are bleak: in 2040, there may be a shortage of up to 3 million skilled workers in Germany. German entrepreneurs often cite well-educated employees and Poles’ good foreign language skills as reasons for doing business in Poland. Interestingly, over 60,000 people in Poland declare that German is their second language and speak it with near native fluency. Additionally, labour costs in Poland are still relatively low. Well-educated Polish economists, engineers, IT specialists and scientists are sought after by IT companies, research and development centres and scientific institutes. Additionally, Poles are very open – especially to their neighbours – and the cultural differences between Poland and Germany are small.
30 years ago, Poland embarked on a path of rapid economic growth to make up in technological terms for its time as a USSR communist satellite. In 2020, Poland no longer lags behind other EU countries when it comes to state-of-the-art technologies. In comparison with the rest of Europe, e.g. the Polish banking system stands out (nearly 66% of Poles pay cashless, of which 85% use contactless payments and 7% their phones), and mobile internet in Poland is the 4th fastest in Europe according to the RFBenchmark report for Q4 2018.
A good summary here is provided by the rosy forecasts for Polish economic growth in 2020: Poland’s GDP is expected to grow by 3.1%, while that of Germany by 1.1% according to International Monetary Fund estimates.