Data from the UK’s Office of National Statistics shows that in the year after Britain had left the single European market, Polish exports of goods to the country fell by 6.6%.
Brexit has slowed and weakened Polish-UK trade relations. Polish SMEs have been adversely affected in many areas of their business. Since Britain's exit from the EU, the British market has lost importance in the context of Polish exports, falling from second place to fourth, behind Germany and now Czechia and France.
Despite the fact that Polish exporters were supported by the government and prepared for the effects of Brexit, some industries (including logistics, food, cosmetics and furniture) reported multi-million losses on trade with the UK.
One of the companies negatively affected by Brexit is the cosmetics company Delia Cosmetics. “The biggest problem for us was to cope with the formalities related to the change of labels on products, registration in relevant databases, incurring the costs of setting up a branch office in the UK, which is a major burden for our business. Permission to trade goods and additional certificates expose our company to costs," said a company representative. [Do we not have a name?]
Also facing the effects of Brexit is Polcar Logistics. “My company struggles every day with the effects of Brexit. Increased transport fees, prolonged customs clearance, and trucks returning empty make me – as a small carrier – lose every day to Brexit,” says Patryk Kędroń, the company owner. The transport sector has been particularly hard hit by Brexit. “Additional fees and formalities and lengthy border stops are reducing demand for cross-border transport. Complicated customs clearance disrupts the fluidity of deliveries and thus companies incur losses,” says Bartłomiej Dobosz, partner at Cordis Logistics Ltd.
The Re_Open UK Programme is a response to the concerns of Polish entrepreneurs who have been directly affected by the UK's exit from the EU. Another call for applications for the Re_Open UK Programme, aimed at companies located all over Poland that have been negatively impacted by Brexit, is now being launched. The Łodz Special Economic Zone is responsible for its implementation. Of the 500 million złotys in the pool, 70% will go to micro-, small- and medium-sized companies. The rest will go to large businesses.
Marek Michalik, president of the Lodz SEZ, points out that the Re_Open UK Programme is an opportunity for firms to reverse the negative effects of Brexit. The programme will help many Polish firms return to the UK market, export more goods or find alternative markets.
“The Re_Open UK programme is a response to the needs signalled by representatives of Polish companies. Thanks to the reserve of more than half a billion złotys, firms will be able to strengthen their presence on foreign markets, invest in promotion at international exhibition events, implement a new strategy or business model offsetting the losses related to Brexit,” says Agnieszka Sygitowicz, the vice-president of Łodz SEZ.
The Re_Open UK programme has nationwide coverage and is aimed at companies registered and operating in the UK that have suffered losses or additional costs due to Brexit. More than €115 million has been allocated to compensate for losses related to the UK's exit from the EU.
Funding received as part of the programme is non-refundable and paid in euros, particularly important with fluctuating exchange rates and for planning investments to open up new markets. Calls for applications are conducted on a competitive basis; applications submitted for funding are assessed by a panel of experts. What distinguishes the programme from other available funds is the co-financing of up to 100% of costs for firms in the SME sector.
Only firms which had been doing business with the UK in 2018 or 2019 can apply for funding if they have experienced a decline in trade with the UK after 2020, or have incurred additional Brexit-related costs.
The programme consists of four project types:
- New export destinations
Financing costs related to the participation in international fairs, exhibitions and trade missions such as transport, travel, accommodation, rental, construction and operation of a stand at a fair, per diems and meetings with business partners.
- Investment Re_start
Projects aimed at financing investment to support new developments in the firm, with possible expenses such as fixed assets, works and construction materials as well as licences, patents.
- Action Adaptation to Change
Adapting businesses to new market conditions resulting from Brexit such as purchase of fixed assets, consultancy services, training for employees
- Brexit no-loss
Allows for reimbursement of costs already incurred from 1 January 2020 from the catalogue of expenses above.
The first three types of projects can be combined, giving a broad spectrum of support for businesses – from trade fairs to investments in fixed and intangible assets, as well as the creation of a strategy and a new business model. All activities aim to support businesses in adapting to new market conditions.
In 2022, nearly €62m is to be distributed, of which 70% (around €43m) will go to SMEs. In 2023, the amount of funding for businesses affected by Brexit will be more than €52m.
To ensure that as many businesses as possible can benefit from the programme, an information campaign is being run across the country, including face-to-face meetings and webinars. Thanks to this initiative, anyone interested can get acquainted with the idea behind the programme and its rules, and get answers to key questions.
Programme website: //reopen.biz/
Łódzka Specjalna Strefa Ekonomiczna S.A. (managing authority of the programme)
Ulica Ks. Biskupa Wincentego Tymienieckiego,
Contact with LSEZ experts:
00 44 42 275 50 89
00 44 887 043 358
00 44 887 043 373
00 44 887 043 370