24 (119) 2016
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British investment in Poland

by The Polish Information and Foreign Investment Agency (PAIiIZ)
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The UK is one of Poland’s key political and economic partners. Our countries share many common values and goals.

One of them is particularly vital – common business projects. Poland is the best place to do business in the CEE region and one of the best in the EU. We are the best investment location in the region due to our brain power, entrepreneurship and hard work, boosted by our central location, economic stability and high GDP growth.

Our country was the 20th hosting economy for foreign direct investment (FDI) in the world, according to UNCTAD.  We occupy third place in Europe in terms of jobs created thanks to FDI and we’re number seven in terms of investment projects, according to EY. A recent survey on Poland’s business climate carried out by Polish Information and Foreign Investment Agency, HSBC Poland and GrantThornton states that 98% of foreign investors present in Poland would invest in this country again. Poland has long been the regional leader in manufacturing, but more recently it has already attracted many high-tech global players from the R&D, ICT and business-services sectors by offering creative business environment, a modern R&D infrastructure and – what’s most important - well skilled, talented professionals.

The biggest British investors in Poland are the global key players in their sectors and are leaders in Poland as well. Most of them have entered Poland due to our market size and nowadays have a well-grounded position in their sectors.  The main companies from the UK include:

Tesco Plc (supermarkets), Imperial Tobacco Plc (tobacco industry), GlaxoSmithKline (GSK - pharmaceuticals), AVIVA Plc (financial services), Bates Ltd (transportation warehousing, Shell Overseas Holdings Ltd. (oil products), Rolls-Royce (maritime, aerospace, R&D, shared services), GKN Driveline (automotive), Johnson Matthey Battery Systems (batteries for hybrid and electric vehicles), Associated British Foods (teas and spices), Provident (consumer credit), Prudential (insurance), Bodycote International (manufacturing services), BP (fuel retailing).

According to data from the National Bank of Poland, the value of British investments in 2014 was €5.8 billion (3.5% of total), which means that the UK is the tenth-largest foreign investor in Poland.

FDI stock in Poland in 2014, € millions

Source: NBP

The inflow of British FDI to Poland follows a general pattern in Polish economy: a significant increase after Poland’s EU accession (peaking in 2006 at over €1 billion); a steep fall in 2008-2009 followed by a reversal later on with a record value of over €3.3 billion in 2013. In that year, the UK was the biggest investor in Poland.
Despite these numbers, British companies are punching below their weight in terms of their investment activity in Poland, as well as their export activities. Whilst Polish exports to the UK keep rising year by year, British exporters are struggling to keep up this pace. UK exports to Poland hit a peak in 2011 and have fallen back since. UK companies often choose countries on other continents and in different time zones for their service and manufacturing projects, when a perfect business partner, EU and NATO member is just over two hours flying time away. On the other hand Polish companies, especially from the IT sector, often choose London as their first step in their global expansion seeing the UK as a springboard for further growth on the US, Middle East and Asian markets.

We also observe new and very positive dynamics in the start-up and high tech community. With the launch of the Google Campus in Warsaw, momentum has been created that accelerates Polish start-ups in their plans for global expansion. The Campus of the search engine giant proved to be a catalyst for other high-tech ambassadors such as TechHub, InnovationNest, MIT and others to set up their operations in Warsaw and help Polish companies grow globally. London's Tech City is usually in the Top Three of most analysed locations for young entrepreneurs to grow their business.
For Invest in Poland – The Polish Information and Foreign Investment Agency, British companies are a strategic partner.  In the Agency’s pipeline currently there are nine projects from the UK, so the United Kingdom is our seventh biggest customer. If all of them will be implemented, it will result in an investment of €24m and 888 new jobs. Between 2000-2015, 41 investment projects from the UK were helped by PAIiIZ to locate in Poland, with a total value of over €1.1 billion, and creating 11,500 new jobs.

Companies that PAIiIZ led in their investment activities in Poland include such companies Rolls-Royce,  HSBC and Prudential.  

Out of 41 projects, most of them were knowledge-intensive high value added services: 17 BPO centres and six R&D projects.  

A good example that illustrates how British investments in Poland developed following the changing market pattern is GSK. It entered the Polish market as it was undergoing transformation, privatising a pharmaceutical company, Polfa Poznan, in 1998. Since then GSK invested in this plant almost $500m, employing 1,500 employees and is Poland’s fourth-largest pharmaceutical manufacturer.

In 2005 the company moved a step forward, employed 26 IT specialists and opened an IT service centre in Poznan. Today the Business Service Centre (one of six such centres worldwide) employs 450 specialists in IT, finance and facilities who deliver services for 100,000 GSK employees worldwide and support 20,000 processes that operate in the corporation. In the nearest future, GSK plans to expand its activities in new IT processes,  accountancy and procurement, and to hire several more hundred people

British projects handled by PAIiIZ 2000-2015, number and value, € millions.  

Source: PAIiIZ.

British manufacturing FDIs in recent years from PAIiIZ perspective – key observations:

  • Large British enterprises entered Polish market in the 90s, investing predominantly in food processing, pharmaceutical and metal processing sectors

  • In the last decade, the British FDI landscape in Poland was driven mainly by investments of medium-sized entities, following a higher value-added stream e.g. aerospace or automotive

  • Last year’s decision by  JLR to locate its new automotive in Slovakia might have been an initial disappointment, but much of the supply chain related to the project will invariably end up in Poland

  • Potential for British manufacturing investments in Poland is still not fully utilised. British companies could benefit from Polish investment assets such as skilled labour, geographical proximity to other CEE and Western European markets and well developed suppliers’ base in various industries.

More in PAIiIZ:

Investors’ confidence in Poland is well grounded

by Sławomir Majman, president of the Polish Information and Foreign Investment Agency (PAIiIZ)


All is well with foreign investment in Poland. That’s the picture emerging from a survey conducted by foreign chambers of commerce, as well as from the list of inward investment projects PAIiIZ is currently working on.