Poland second in Central and Eastern Europe – results of the 12th edition of the Economic Survey

Poland gained a strong, second position, despite low scores on political and social stability of the country and  predictability of economic policy – showed the results of the 12th edition of the Economic Survey conducted by the German Chamber of Commerce in Poland in cooperation with 13 bilateral chambers of commerce – American, Austrian, Belgian, British, Canadian, Dutch, French, Irish, Italian  Portuguese, Spanish, Swiss and Scandinavian, associated in the International Group of Chambers of Commerce.

The results presented during the conference that was held on the 20th of April 2017 in Warsaw showed that the top-four countries to locate foreign investments in the Central and Eastern Europe are the Czech Republic, Poland, Slovakia and Estonia. At the opening of the conference, Deputy Minister of Development, Jerzy Kwieciński, emphasized the importance of foreign investments in Poland, especially those that create high added value, are based on knowledge and innovation and from which profits are re-invested in Poland.

Poland scored 4.09 out of six possible points to receive. The Check Republic, being number one, scored 4.13 points. Slovakia (4.0 points) overtook Estonia (3.94 points), as was the case last year.

The Majority of foreign companies taking part in the survey 2017 positively evaluated the current state of the Polish economy. More than half of the respondents (54.3%) chose satisfactory, and another 32.1% - good. The negative opinion was expressed by 13.6% of the respondents.

As the most important challenge for Poland's economic policy, the efficiency of public administration and the reduction of bureaucracy were pointed out - 80% of the respondents from the Scandinavian companies considered  these aspects as very important.

The assessment of the countries presented in the study was based on 21 factors determining their attractiveness in the opinion of investors. The biggest changes in the ranking of evaluated items compared with last year's edition were the positive assessment of transparency of public procurements (from 17th to 13th place), labor costs, conditions for research and development, fight against corruption and crime, as well as public administration work.

Once again, the surveyed companies rated Poland highest for its membership in the European Union as well as the broadly understood human resources. The assessment of the quality and availability of the subcontractors, gained as well, listed as the third most important factor. Subsequently, the respondents appreciate the academic education as well as the efficiency and motivation of the employees.

Carsten Nilsen, Chairman of the Scandinavian-Polish Chamber of Commerce emphasized: “Scandinavian investors have been present in Poland for many years and continue to look with optimism into the future development of their companies in Poland. They value high level of education and motivation of Polish employees. On the other hand, Polish employees appreciate the Scandinavian management style, including the flat hierarchy structure and the importance  that employers put into teamwork”.

At the same time, the results of the study highlight the negative trend in the availability of qualified staff, with a drop from 8th to 12th, in the vocational training system, as well as legal certainty and flexibility in labor law.

Infrastructure was in the sixth place. The last two positions were taken by the political and social stability (the drop from the 6th position in 2015 to the 20th position in the 2016 survey was unchanged in this year's survey) and the predictability of the economic policy (after falling from 17. to 21st place in 2015, remains as the last position of the ranking).

During his speech, Krzysztof Senger Vice-President of PAIiH commented that the short-term sentiment correction (by 0.06p) was related to the changes in legislation and uncertainty about the direction of future economic policy. Almost all entrepreneurs participating in the survey positively assessed the current state of the Polish economy, although the negative opinion was twice as high as in the previous year (13.6% versus 6.3% in 2016).

The upward trend also indicates investors' sentiment for business prospects. According to the results of the 12th edition of the survey, 28.2% of companies plan to increase their exports (compared to 26% in 2016), while the increase in employment is predicted by 45.3% (43.4% in the previous year) of the respondents.
Poland's persistence on the top of the list of countries worth investing in and the confidence of respondents that they would invest here for the second time – from 94.5% in 2016 to the current 95.6%, makes a positive impression.

Scandinavian investors in their assessments somewhat differed from the presented general picture of Poland's investment attractiveness. First of all, 80% indicated the need to improve the efficiency of public administration and reduce red tape. At the same time, they remained optimistic about the general economic situation of our country, 36% have noticed an improvement, for 42% situation remained unchanged compared to the previous survey. Although the situation in their industries is positive, only 47% compared to 68% in 2016 predict that the economic and business situation in their companies will improve. This assessment goes parallel with the percentage of respondents predicting an increase in profits. Compared to 82% of the respondents who believe that revenue growth in 2016, 52% of the respondents said that in 2017.

The overwhelming number of Scandinavian entrepreneurs, as much as 84%, would choose Poland as a good investment destination again. They were, however, less enthusiastic  about Poland‘s entry to the euro zone. In 2016, 48% of respondents expressed their positive attitude, while in the current edition this number has fallen to 31%.

The survey was conducted in February 2017 among 369 companies with foreign capital operating in Poland. 235 investors came from Germany, 16 from Scandinavia, 15 from the USA, 13 from Italy, 11 from France and Austria and 9 from Switzerland. The rest of the respondents were, among others investors from Spain, Netherlands, Belgium and the UK.

Results of the Economic Survey 2017 to be download here.