Country Presentation - PolandSICC 2009

Poland and its leadership role in Central / Eastern Europe19th of March, 2009

Aleksander JóźwikJustyna Kowalczyk

Agata RundoTomasz Zacharski

Agenda

AGENDA

1. Basic Data

2. Contemporary issues

Economic Crisis European Football Championships 2012 American Anti-Missile Shield

3. Poland as an attractive Business location

Agenda

AGENDA

1. Basic Data

2. Contemporary issues

Economic Crisis European Football Championships 2012 American Anti-Missile Shield

3. Poland as an attractive Business location

POLAND

Addresing the common misconception…

…about Polar Bears walking on Polish streets.

POLAR

POLAND

Addresing the common misconception…

Average Temperature in Poland is about 20OCAverage Temperature in the North Pole is about -20OC

Poland has a slightly greater population than Canada and is the 6th largest country in the European Union. It’s GDP of ~$550b is comparable to the one of Ontario.

Basic information about Poland

• A very homogenic nation• Population: 38m people• Size: 300.000 km2

• GDP: $550b• Dynamic growth (5,4 %)

BASIC DATASIZE COMPARISON

POLAND AND ONTARIO

Fun facts about Poland

Fun facts about Poland

Fun facts about Poland

Fun facts about Poland

Fun facts about Poland

Fun facts about Poland

Fun facts about Poland

Agenda

AGENDA

1. Basic Data

2. Contemporary issues

Economic Crisis European Football Championships 2012 American Anti-Missile Shield

3. Poland as an attractive Business location

Poland, while experiencing problems with the credit crunch and export breakdown, remains relatively resistant to the effects of the economic crisis

POLAND – ECONOMIC OUTLOOK

• Polish banking system was relatively under-developed at the moment of the credit crunch (banking assets <75% of GDP), which softened the blow during the crisis• Poland has a big internal market and enterprises are used to funding investments through equity rather than debt• Currently Poland struggles to distinguish itself from the crisis-struck CEE in the eyes of the investors• Polish government is determined on tight fiscal policy and providing additional incentives for business

After the crisis Poland may well rise as the best standing economy in Central & Eastern Europe.

Summary of Poland’s Economic Situation

-2,3%

-1,8%

-4,0%

+1,8%

+1,8%

+2,7%+1,7%

+2,0%

Football European Cup 2012 (hosted by Poland and Ukraine) is currently the biggest infrastructure project in CEE, with over 38b EUR to be spent in 2008-2012

• Considered one of the most important sport events in Europe – held for the first time in CEE region

• Generally considered the most ambitious project in Polish post-transition history

• Total value of the project amounts to b38 EUR, in areas such as: roads, hotels, sport facilities, etc.

• At the moment Poland is managing to keep up with deadlines for the majority of its projects (still problems with road and aviation infrastructure)

• Ukraine is currently facing big problems due to economic crisis and political instability talks of shifting the Euro from Ukraine to Germany

Information about the EURO 2012 Football Championships

The most delicate political issue in Poland at the moment is the US anti-missile defence system which will be located in Poland and Czech Republic

• While it was designed to repel the nuclear threats of Iran and North Korea, the system is considered a threat by Russia, which fears it could be used against its strategic nuclear forces – thus threatening the status quo between both countries

• Recently Russian authorities threatened that they will locate more of their strategic missiles in the Kaliningrad region if Poland and USA will continue their anti-missile shield project

• While the agreement regarding the placement of the anti-missile system was signed between USA and Poland last year, there are discussions whether the Obama administration will back off from the deal

The Anti-Missile Shield Project

Agenda

AGENDA

1. Basic Data

2. Contemporary issues

Economic Crisis European Football Championships 2012 American Anti-Missile Shield

3. Poland as an attractive Business location

Poland is still one of the most intended locations of investment projects in Europe.

European Attractiveness Survey

Source: Ernst & Young, „European Attractiveness Survey” 2005

Source: OECD, Employment Outlook 2006

Although Poles are hard-working and determined to succeed...

Annual hours of work across the world

Source: EIU 2006

Labor cost per hour in 2006 (USD) Average monthly gross wage in EUR

Source: Statistical Offices

300

350

400

450

500

550

600

650

700

1999 2000 2001 2002 2003 2004 2005

Poland Czech Rep. Hungary

...wages in Poland are still among the lowest in Europe.

Wage structure in Poland

Labor costs in Poland equal to about one fifth of the Western Europe ones Since 2003 labor costs in Czech Republic are higher than in Poland

≤2 3-4 5-6 7>

Gądki

Bielsko-Biała

Dąbrowa Górnicza

Piaseczno

According to PAIiIZ information there are 35 BPOs located in Poland.

Scope of activities: finance and accounting, HR, logistics, CRM.

Total employment: 6,500 people.

Examples:

NUMBER OF CENTERS

Poland has multiple academic and business centers, which assured balanced development of the country

Business Process Offshoring

There are 40 R&D centers created by foreign investors in Poland. They totaly employ over 4500 people.

The biggest SSC belong to and serves:

Warsaw:

Krakow:

Wrocław:

Wrocław

Szczecin

Bydgoszcz

Gdańsk

Warszawa

Kraków

Poznań

Katowice

Kielce

Bielsko-Biała

Częstochowa

Zielona Góra

Gorzów Wielkopolski

Gliwice

Garwolin

Radzymin

Skawina

Bielawa

NUMBER OF CENTERS

Research & Development Centers

Similarly, R&D centers are spread throughout the country, mainly next to main academic and scientific sites

Source: Central Statistical Office, AG „Test” 2004

Metallurgy & Metal

• Average gross wage rate: 570 EUR (average wage for engineers - 820 EUR).

• Employment: 176 700 persons.

• Number of foreign companies: 50

Automotive

•Average gross wage rate: 500 EUR (average wage for engineers – 710-830 EUR).

• Employment: 120 000 persons.

• Number of foreign companies: 300 (Tier 1 + Tier 2).

Machinery & Equipment

•Average gross wage rate: 520 EUR (average wage for engineers - 820 EUR).

• Employment: 138 600 persons.

• Number of foreign companies: 36.

Electrical Machinery & Apparatus

• Average gross wage rate: 510 EUR (average wage for engineers - 820 EUR).

• Employment: 73 000 persons.

• Number of foreign companies: 39

Key sectors and locations in Poland

Even spread of business centers across Poland allowed for the entry of various industry giants

GE started operation in Poland in 1992 and have invested since then $400 mln assuring jobs to 6000 emlpoyees

Attractiveness Criteria General Electric ShowcaseBig domestic market GE Money Bank Talent pool Variety of operations: banking,

production, R&DPricing 3 factories GE Power ControlMobility of workforce Warsaw, Gdansk, Wroclaw, Lodz,

Bielsko-BialaEngineering competencies

Engineering Design Centre (Warsaw), Project Centre GE Security (Gdansk)

General Electric case

THANK YOU!