POLISH INFORMATION AND FOREIGN INVESTMENT AGENCY Business opportunities in Poland

Poland - Key Facts Area: sq km – 6th in European Union Population:38,12 million – 6th in European Union Currency:Polish Zloty (USD 1 ~ 2.9 PLN) GDP total:USD 684,5 billion (PPP, 2008) GDP growth:6.7% (2007), 4.8% (2008), 1.4% (2Q 2009) Membership:EU, NATO, OECD, WTO, Schengen Zone

Competitive Advantages Location & economic fundamentals  strategic location in continental Europe  part of trans-european transportation corridor  the only country with the positive GDP growth in 2Q 2009 in EU  38 million of consumers Investment incentives  14 Special Economic Zones  over 110 bn USD from EU Labor force  young, well-educated work force  ca 11% of university students in the EU  456 universities & high education schools  increasing labour productivity 1000 km radius 250 mn people 2000 km radius 550 mn people

„Velvet crisis” in Poland Reasons according to Prof. Leszek Balcerowicz: 1.Stricter banks’ credit policies before crisis compared to other countries 2.No dynamic growth of foreign debt as in other countries 3.Financial instruments far less sophisticated as in the USA 4.Smaller influence of stock market on the economy than in the USA 5.Falling natural resources’ prices Poland is much less affected by the crisis than neighbouring countries

GDP contraction - II Q 2009 (II Q ‘09 – II Q ‘08) Data prepared by national statistical offices * EC forecasts ** GDP growth - II Q 2009 (II Q ‘09 – II ‘08) Poland is the only European country with the positive GDP growth

Investment Climate in Poland Key findings of a 2009 survey: The climate was rated 3.3 out of 5 points (first improvement in 3 years’) No category rated worse than in previous survey Biggest achievements in categories rated earlier as the weakest. Source: PAIiIZ, Best rated categories in the 2009 survey

Poland: Falling Unemployment Source: Central Statistical Office 2009 over 20% 09/ % Employment rate grew since 2004 by over 5% up to 51.0% in 2008

Wages & salaries in 2009 (gross, in USD) Source: CSO, May 2009, National Bank of Poland USD <1000 USD >1100 USD In Sept average salary was USD 1139 In 1990 net average pay was ca. USD 110

FDI inflow (bn USD) and sources Source: NBP 2009 Geographical sources of FDI inflow * Estimated

Source: PAIiIZ, 2009 FDI projects in 2009 PAIiIZ projects details: USD 6,15 bn FDI inflows for the first 8 months 55% of the same period FDI inflows in 2008 Completed PAIiIZ projects worth USD 500 m new workplaces created by PAIiIZ projects Most popular sectors: Automotive BPO Renewable energy

Source: World Investment Report, UNCTAD 2009 Poland as a major FDI recipient in the region: Poland attracted ca. USD 16.5 billion in 2008, the highest amount among 12 new EU states. Poland in World Investment Report 2009 & 2008 According to UNCTAD the key factors attracting FDI to Poland are: rapidly expanding domestic market flexible & skilled labour force solid banking system

There are ca 2m university students in Poland POZNAN WROCLAW WARSAW KRAKOW LODŹ SZCZECIN TRICITY KATOWICE BYDGOSZCZ-TORUN BIALYSTOK LUBLIN RZESZOW Main academic centers Source: Polish Statistical Office 2009

Source: NBP portal, 2009 Higher education trends in 2009 Number of 1st year students by group of fields The most popular are economical studies Increasing popularity of technical studies 2,8% secondary school graduates applied for technical studies in 2009 (2,0% in 2008) 2 Universities of Technology (Gdansk & Warsaw) among 3 most popular high schools

Knowledge of Foreign Languages 57% Poles is able to speak at least one foreign language, 32% of Poles speak two, 4% - three languages. Similar situation in EU: 56% of EU citizens speak one foreign language, 28% - two languages. Percentage of young Poles speaking foreign languages Learning of foreign languages is obligatory in the Polish education system Source: Eurostat 2006, TNS Opinion & Social (UK) December 2006, Ranstadt 2008

Poland in World Investment Prospects Survey The 11th most attractive for investors Source:UNCTAD, World Investment Prospects Survey

Source: Top 50 Emerging Global Outsourcing Cities, 2009 Tholons Top 50 Emerging Global Outsourcing Cities „Poland is emerging as a premiere nearshore shared services center for Western European and Scandinavian client markets. With its capabilities in serving the full spectrum of services in both ITO and BPO spaces — Poland has emerged as arguably the strongest competitor in the region for a spot in the Top 5 Offshore Nations list.” 1. Canada 2. Russia 3. Mexico 4. Vietnam 5. Poland Top 5 offshore nations Top Global Outsourcing Cities Rank 2009 CityCountryRank 2007 Rank Cebu CityPhillippines41 2ShanghaiChina82 3BeijingChina103 4KrakówPoland165 …………… 28WarsawPoland2628

Top 10 best performing industrial space locations in Europe Source: Cushman & Wakefield, Polish cities among top 10 locations in Europe Average rental cost growth in Poland reached 28% in 2008 Growth was driven by strong demand and by insufficient supply Industrial space occupation cost

Services and Manufacturing Hub Automotive White goods Electronics

Services and Manufacturing Hub Aviation BPO R&D

I.Government grants through individual negotiations individually approved and granted by the Ministry of the Economy based on the Council of Ministers’ Resolution II.CIT exemption in Special Economic Zone only available in Special Economic Zone (SEZ) III.Real estate tax exemption subject to negotiation with the local authorities only in case if the investor is the owner of the building (provided by the Commune Council) IV.Cash grants available through EU Funds subject to negotiation with different managing institutions depending on the investment project key parameters Forms of state aid in Poland All above presented instruments can be combined together however the total amount of state aid cannot exceed the maximum aid intensity

More than EUR 87 billion in Operational Programmes will be financed from the EU Funds (more than EUR 67 bn) and Polish contribution (over EUR 20 bn)

Why Poland? Summary Availability of skilled human resources Economic and political stability Effective incentives system including EU-Funds Strategic location – gateway to EU

Short list Short list of countries, choice of locations, investment incentives system’s analysis, negotiations with central and local authorities, finding the potential partners Investment decision Long list of countries Project Managers assistant, fact finding missions, authorities and Special Economic Zones contact support Considering of investment Strategic decision regarding new investment, destination of investment. Analysis of macroeconomic, social and political conditions of the countries, including investment incentives system Set of real estate offers Fact-finding missions and site selection visits Project Managers assistance in contact with local and central authorities co-operation with Special Economic Zones (support in negotiation process) where available Information about the available incentives for the specific project PAIiIZ assists in obtaining financial support from the state government and other sources within the existing investment incentives scheme Finding potential suppliers After-care services Press conference Ombudsman for foreign investors Tailor-made information on: legal environment, economic situation, HR pool, infrastructure, incentives available in Poland sectoral data and other required information Agency’s offer

Thank you for your attention Warszawa, ul. Bagatela 12 tel. (+48 22) , fax (+48 22)