Investment and other opportunities in Poland (June 2009)

PowerPoint Presentation

Nigel Adams & Company Ltd*Investment and other opportunities in Poland

A presentation by Nigel Adams at the EMITA seminar onPartnering with Poland Loughborough, 10 June 2009

Nigel Adams & Company Ltd

Nigel Adams & Company Ltd*Foreign Investment in Europe


Jobs created by FDI in 2008Nigel Adams & Company Ltd*


Investment Projects in 2008Nigel Adams & Company Ltd*


Nigel Adams & Company Ltd*Ease of doing businessThe lower the ranking the easier to do business


Chart1

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74

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Ease of Doing Business in 2008 According to World Bank

Sheet1

Ease of...SlovakiaHungaryBulgariaRomaniaCzech RepPolandMacedonia

Doing Business32454648567475

Starting a Business7267100269112921

Dealing with Licenses5087103908315676

Employing Workers7581571455578128

Registering Property59662123548191

Protecting Investors981073333833383

Paying Taxes1221278813411312599

Trading Across Borders90458938304072

Enforcing Contracts50129037976884

Closing a Business3653728110888127

Sheet1

Ease of Doing Business in 2008 According to World Bank

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Future FDI IntentionsNigel Adams & Company Ltd*


Nigel Adams & Company Ltd*Source: CIA, BBC and British Polish Chamber of CommercePolandArea: 312,685 sq kmPopulation: 38.5 millionAv pay:666/mth (March 2009)Corporate tax rate: 19%Inflation: 4.0% (April 2009) Unemployment: 11.0% (2009)Growth rate: 2.0% (2009 Fcst) Main exports: Food products, Furniture, Vehicles & Automotive components.


Nigel Adams & Company Ltd*Poland and the PolesAdmire Britain, wary of neighboursAware of history and links with Britain: WW2English is a second language for under 40sYoung are very keen to succeedWell educated and technically very skilledStatus, seniority & titles still importantInitially rather formal - Mr Kowalski not Jan Charming (hand-kissing!) and hospitable


Comments by one of my UK clients regarding the quality of Polish applicants: I am increasingly amazed at the quality of applicants we are getting to the advertisement. We have never had such a high quality, well-educated response from the UK."Another really highly qualified candidate! Why can we never find this quality of employee in the UK?Quality of Polish EmployeesNigel Adams & Company Ltd

Nigel Adams & Company Ltd*Nigel Adams & Company Ltd*Special Economic ZonesA manufacturing SME in a Special Economic Zone canreceive: 65% income tax exemption on its investment costs.65% income tax exemption on the first two years costs of hiring new employees.The possibility of property tax exemption in selected locations where the SEZ is situated. Selected employment support programmes organised by the Regional Labour Office concerning recruiting and training of employees.


Special Economic ZonesNigel Adams & Company Ltd*


Nigel Adams & Company Ltd*Investment considerationsMany investors now look for:Sustainability i.e. Investment environment not just Lowest cost. This makes:Political and legal stabilityTelecoms/Broadband infrastructureRoad Infrastructure Education levelInnovation clustersQuality of supply chainsMore important than just:Labour costs and government incentives


Nigel Adams & Company Ltd*Some final thoughtsThe selection of the location for your investment will depend on:Your business sector.The location and size of your current and potential markets.The size of your company and amount you plan to invest. If, after careful analysis, you have a choice of two excellent locations, then choose the place and people you and your colleagues like to work with!


Nigel Adams & Company Ltd*Investment and other opportunities in Poland Nigel Adams BA (Hons), F.C.I.M.Web site: http://www.nigeladams.come-mail: [email protected]: 020 3016 8385


*IntroductionI am here talking to you today at the request of Juliet Pask as I have been involved in business with Poland since 1972. Yes 1972, I am that old!! Having obtained an degree in Business Studies back in 1970, my work in International Marketing started when was a young export sales representative working for Massey Ferguson. Yes, as you see, it was a long time ago!!I have been involved in international business since that time, following my work with Massey Ferguson, I worked for Cargill (commodity traders) as a Counter-trader and since 1985 as an independent international business adviser.Although I have been involved with Central & Eastern Europe for about 35 years, from 1993 until 2002, I actually lived in Poland and worked all around the country. At that time I was a British government Know How Fund Adviser, helping to change the mentality of people in state companies prior to and during privatisation.My original Know How Fund project was forecast to last about 18 months, but our work was very successful and my contract was renewed every year throughout the 1990s.Today I have two full time jobs which I will tell you about at the end of my talk.*Foreign Investment in EuropeThis chart is and the statistics shown here are from the Ernst & Young European Attractiveness Survey 2009, which was only published a few weeks ago.My friends involved in inward investment in Poland are very pleased that in 2008 Poland maintained its 2nd position to UK in the number of jobs created and moved up two places to 5th position in the number of FDI projects announced.Obviously the Poles did not mention that between 2006 and 2007 they had slipped from the top position in the E&Y Survey, due to a great decline in the number of electronics sector jobs created!(Review and discuss.)

Lets have a look at Polands position in more detail ...............

Jobs created by FDI in 2008

(Read and comment)

In addition to jobs created by FDI, let us look at the actual number of FDI projects announced by each country............*Investment Projects in 2008

(Read and comment)

However, as you know you can find anything you want in statistics, so let us look at another factor . The European Countries considered by investors of new investments or expansion of previous investments, according to a annual World Bank survey

**Ease of doing business in each countryLet us now have a look at some interesting rankings from the World Banks analysis of how easy it is to do business in each country. See http://www.doingbusiness.org/ This chart shows the World Banks 2008 ranking of the Ease of doing business in the 6 Central & Eastern countries I am reviewing today.

You will see that Slovakia, which does not even get into the Ernst & Young statistics, is rated easiest country to do business in!

Poland, which comes out well in the E&Y survey, dropped in the World Bank rankings from 68th in 2007 to 74th in 2008.

We should therefore perhaps consider investing companies future intentions and Ernst & Youngs survey does this Future FDI Intentions

What are business leaders telling E&Y?In total, 74% of respondents say they are very confident, or fairly confident in Western Europe's ability to tackle the financial and economic meltdown. CEE is also expected to overcome present difficulties, although potential investors are more reticent about its capacity to do so. Can East Europeans cope alone? A deep split is developing in Europe over the extent to which Europe's richer Western countries should help their poorer Eastern neighbours.Beleaguered Eastern members fear old Europe is drifting from the core European Union principle of a single market, and that this could leave "new Europe" abandoned in its time of need.

**Poland

Agnieska has covered the important Points about Poland and its economy, but as a reminder here is a summary slideBy far the largest recent EU accession states by area and population (38 million).One of the few countries in the EU where growth is continuing, although it has declinedInflation is now around 4.0%Unemployment has been halved since 2004. (Tell joke about British Government doing more to solve Polish unemployment than Polish government.)Wages (Av 666 per month)Growth forecast at 2.0% in 2009 Compare with the rest of EU and especially UK!No Credit Crunch!

Following all the statistics, I will give a few personal comments Poland and the Poles*Poland and the Poles

(Discuss)*Discuss *Special Economic ZonesThese are to be found throughout Poland and they all have to follow EU regulations regarding government economic aid and incentives. The amounts of aid allowed depend on the regions economic development and regional employment levels. The amounts also depend on the size of the company applying for the aidI though it best to use a concrete example from Poland, which is what I am showing here. The tax exemptions allowed include the following:(Read slide.)More information can be found on: http://www.sse.lodz.pl

NOTE: The European Commission reformed European Union state aid rules in 2008. The new general regulation (GBER) which entered force from January 2009 considerably simplified, clarified and speeded up state aid provision to entrepreneurs. Theses changes should also facilitate more types of state aid beyond investment aid. However, I am always cautious about suggesting any SME should get involved with anything to do with the EU!!

Special Economic Zones

I am sure you are asking yourself: OK, but where are the Special Economic Zones?

Well, here is the official PAiiZ map.

However, in my experience these official locations can be increased in size or even new location can be added.

**Investment Considerations

*Some final thoughts

(Read and comment)*I hope that you have found this brief introduction interesting and it has whetted your appetite to look at the opportunities that exist in Poland for the development of your particular business.

Now for my advert if you think that I might be able to help you to develop your business in the region, please talk with me today or give me a call.

Finally, as I like to keep busy, I also have another full-time job. I am also the Programme Director of the only honours degree course in Europe during which undergraduate students start and run their own businesses as an integral part of their honours degree! If you would like to hear more about this, please ask me.

Investment and other opportunities in Poland (June 2009)

Business

special economic zones

2008nigel adams

nigel adams

fdi projects announced

world bank

ernst

british government

jobs created