1. AND FOREIGN INVESTMENT AGENCY
POLISH INFORMATION
AND FOREIGN INVESTMENT AGENCY
WHY POLAND
Monika Gąsiorowska
Seattle, March 12th 2012

2. Agenda I. Why Poland – Key Facts II. Foreign Investment - Advantages
III. Why Eastern Poland

3. Poland - Key Facts Area: 312 700 sq km – 6th in European Union
Population: 38,12 million – 6th in European Union
Currency: Polish Zloty (USD 1 ~ 3.10 PLN)
GDP volume: USD 721 bn (PPP, th in the EU)
GDP growth: 1.6% (2009), 3.9% (2010), 4.3% (2011*)
Membership: EU, NATO, OECD, WTO, Schengen Zone
GDP composition by sector: agriculture – 4.6%, industry – 28.1%, services – 67.3%
Employment by sector: agriculture – 17.4%, industry – 29.4%, services – 53.4%
21st economy in termes of GDP PPP
* Central Statistical Office of Poland, forecast 2012 3

4. Real GDP growth rate (2009) Poland was
FIN -8,4% NO
-1,7% SE
-5,0%
EU27: %
USA: ,5%
Japan: - 5.5%
EE -14,3%
Poland was
a green island in the red Europe
LV -17,7%
LT -14,8% IR
-7,0% DK
-5,2% UK
-4,4% PL
+1,6%
NL -3,9%
BE -2,8% DE
-5,1%
CZ -4,7%
SK -4,9% FR
-2,7%
AT -3,8%
HU -6,8%
RO -6,6% IT
-5,1%
BG -5,5% TR
-4,8% PT
-2,9% ES
-3,7% GR
-3,3%
Source: Real GDP growth rate, Eurostat 2012

5. GDP changes in 2010
2009:
Poland avoided recession & experienced the highest GDP growth in Europe
2010:
developed at one of the highest pace in Europe
2011:
Polish economy growths two times faster than all EU FI
3,1% NO
0,4% SE
5,5%
EE 3,1%
LV -0,3% DK
2,1%
LT 1,3% IR
-1,0% PL
+3,9% UK
1,3%
NL 1,8% DE
3,6%
BE 2,1%
CZ 2,4%
SK 4,0% FR
1,6%
AT 2,0%
HU 1,2%
RO -1,3% IT
1,3%
BG 0,2% ES
-0,1% PT
1,4% TR
7,5% GR
-4,5%
Source: Eurostat.

6. Poland leads in GDP growth
Poland one of the leading countries in terms of GDP growth
fifth in the world
first in Europe
Source: The Economist 2011

7. EC forecast of GDP change in 2012
Source: Eurostat, February 2012

8. Most attractive countries for FDI
Perception
Most attractive countries for FDI
Rank 2011 (2010)
Country 1
China 2
USA 3
India 4
Brazil 5
Russia
6 (12)
Poland 7
Indonesia 8
Australia 9
Germany
According to UNCTAD, Poland is 6th most attractive country for foreign investors in the world.
Source: World Investment Report 2011. 8

9. Agenda I. Why Poland – Key Facts II. Foreign Investment - Advantages
III. Why Eastern Poland

10. Competitive Advantages
Location & economic fundamentals
strategic location in continental Europe
part of trans-European transportation corridor
stable economic growth - the only country of the EU with positive GDP growth in 2009
38 million consumers
1000 km radius
250 mn people
Labor force
young, well-educated work force
ca 11% of university students in the EU
455 universities & high education schools
language proficiency
increasing labour productivity
Investment incentives
tax exemptions in 14 Special Economic Zones
grants co financed from the EU (USD 110 bn)
2000 km radius
550 mn people

11. European Funds - over EUR 87 bn in 2007-2013
Operational Programmes financed from the EU Funds
(ca EUR 67 bn) and Polish contribution (ca EUR 20 bn)
100%= EUR 87 bn
Poland is the largest beneficiary of EU funds. Over 87 bn was assigned to Poland.
For investment projects are those programmes realted to improving the competitiveness of enterprises by innovation, human resources development and regional development. Each company registered in Poland can apply for financing from EU structural funds.

12. Students and graduates
Number of 1st year students by group of fields
20 M young people
almost 2 M students
more than 400 thous. graduates every year
more than 90% of students know foreign
languages
Main academic centers
360>
POZNAN
WROCLAW
WARSZAWA
KRAKOW
LODZ
SZCZECIN
TRI-CITY
KATOWICE
BYDGOSZCZ/TORUN
BIALYSTOK
OLSZTYN
ZIELONA GORA
OPOLE
KIELCE
LUBLIN
RZESZOW
455 higher education institutions
18 universities
22 technical universities
95 academies of economics
growing number of science students
201 >
151 – 200
101 – 150
51 – 100
50 <
No. of students (thousands)
Source: Central Statistical Office

13. Foreign language capabilities
Foreign language capability by age groups
Language proficiency is one of the strongest points for Poland as a BPO center
Children learn foreign languages from the age of 6
Foreign language capability among students
English is the most popular foreign language in Poland
Learning of foreign languages is obligatory in the Polish education system
Source: CBOS Survey 2006, Randstad, October 2008

14. Tax rates Corporate Income Tax (CIT) rate: 19%
Personal Income Tax (PIT) rates: 18% & 32%
Value added tax (VAT)
basic rate : 23%
reduced rates : 8%, 5%
export rate : 0%
Social Security Tax paid by employer
between 17.48% and 20.41% 14

15. FDI flows in 2011 (bn USD) World +17% Poland +46.7% * Estimates
Source: UNCTAD, January, 2012.

16. FDI inflow to Poland (EUR bn) and its sources
Geographical sources of FDI
Cumulative value of FDI
Major FDI investors in Poland
(FDI stock at the end of 2010, bn EUR)
Source: National Bank of Poland 2011 16

17. Services and Manufacturing Hub in Poland
Automotive
White goods
Electronics

18. Services and Manufacturing Hub in Poland
Aviation
BPO
R&D

19. Aviation companies in Poland
Warsaw
Spółka Pratt & Whitney Kalisz powstała w 1992 roku. Od 1996 roku jedynym udziałowcem spółki jest Pratt & Whitney Kanada Inc., światowy producent silników lotniczych. Spółka ciągle się rozwija – w 1992 roku zatrudniała 13 osób, w 2007 roku zatrudnia 1554 pracowników. Produkuje części do silników lotniczych, a cała jej produkcja jest eksportowana do jedynego odbiorcy – Pratt & Whitney Kanada Inc. Asortyment firmy charakteryzuje się najwyższymi wymogami technicznymi, dużą złożoności technologiczną, a jego produkcja wymaga najwyższej klasy parku maszynowego o nowoczesnej technologii.
CAV Aerospace From a 20,000ft² manufacturing facility in Nowa Deba, south eastern Poland, CAV offer low cost capabilities covering sheet-metal fabrications and sub-assemblies. The team in Nowa Deba provide components and assemblies of exceptional quality standards. Project management and technical competence are at the heart of the team, with a dedicated and integrated approach to product supply, from concept, with in-house design support (Catia v5 based) through to implementation.
Kreisler Polska Sp. Z o.o. - wytwarza komponenty dla przemysłu lotniczego i turbin gazowych generatorów energii elektrycznej. Oferuje usługi w zakresie toczenia, frezowania, gwintowania i elektroerozji. Posiada zaawansowany system zarządzania jakością zgodny z AS/EN 9100, który ciągle doskonali. Kreisler Polska korzysta z nowoczesnych technik zarządzania produkcją czyli Lean Manufacturing, 5S, Continual Improvement, które zapewniają niezbędny poziom elastyczności wobec wymagań ich klientów. Zakład produkcyjny firmy składa się z dwóch hal o łącznej powierzchni 1000 m2 i wydzielonej przestrzeni administracyjno biurowej.
Nicholsons Sealing Technologies Sp. z o.o. - founded in 2005 as an Eastern European base for both Sales Development and Strategic Sourcing activities. With highly experienced and skilled engineering and commercial employees based in the South East of Poland, it is the Supply Chain Management interface between our world-wide customers and suppliers in Poland. Nicholsons Group - global specialists in the design and manufacture of high temperature metal seals, gaskets and ancillary components for the aerospace, automotive, turbocharger, oil and gas, power generation, and process industry sectors. With over 80 years experience of product and process engineering design and production allied to leading-edge technology and a highly skilled workforce, Nicholsons provides quality components and professional services to customers on land, sea and air.
King & Fowler Polska Sp. z o.o. - oferuje kompleksową obsługę procesów obróbki powierzchni metali dla branży lotniczej i inżynieryjnej, w tym: kadmowanie, chromowanie twarde, nieinwazyjna metoda testowania – magnetyczna oraz penetracyjna, miedziowanie, cynkowanie, pasywacja jak również anodowanie (w kwasie siarkowym, chromowym oraz siarkowo-borowym) i malowanie. King & Fowler Polska, będąc częścią grupy Aerogistics, organizuje transfer wszystkich certyfikacji na polski oddział, w tym NADCAP, Airbus, Rolls Royce, Smiths, Bombardier, Goodrich oraz Messier Dowty. King & Fowler Polska obecnie posiada certyfikacje przemysłu lotniczego ISO9001:AS9100, NADCAP (dla nieinwazyjnych metod testowania oraz procesów chemicznych) jak rownież następujących firm: Boeing, BAe Systems, Raytheon, Saab i Hispano Suiza.
RD Precision Mielec Sp. Z o.o. - manufacturing started in November 2005 and the workforce and capacity has grown steadily since. Today 51 qualified engineers and 17 staff ensure the efficient running of our latest facility 24 hours a day 7 days a week. Mielec offers RD Precision customers a low cost, one stop production option. We're able to cut materials such as steel, aluminium and titanium and treat the parts locally increasing efficiency and control, whilst keeping the cost low. RD Precision to firma, która zajmuje się produkcją detali i elementów lotniczych dla wielkich koncernów tej branży.
Remog –
seryjną produkcją korpusów hydraulicznych dla takich firm jak: Linde, Bosch Rexroth. Do tego celu przeznaczone są:
wielkoseryjną produkcją zaworów Ventil ZDR Platte dla Bosch Rexroth.
- ręcznym gratowaniem części lotniczych dla firmy Liebherr Aerospace. Ze względu na bardzo dużą wymaganą dokładnoć, większość operacji przeprowadza się pod precyzyjnymi mikroskopami.

20. State aid (I) CIT exemption in Special Economic Zone
only available in Special Economic Zone (SEZ)
II. Government grants through individual negotiations individually approved and granted by the Ministry of the Economy based on the Council of Ministers’ Resolution
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
Poland offers to investors a number of investment incentives, of which the most important is the possibility to invest in one of the 14 Special Economic Zones, that is areas specially prepared for investment, which offer even full exemption from income tax, plus exemptions from local taxes from real estate and means of transport.
Advantages of SSE: fully infrastructured, One-stop-shop services, income tax exemption for production and R&D,unlimited, well-educated workforce, concentration of suppliers and subcontractors
All above presented instruments can be combined together however the total amount of state aid cannot exceed the maximum aid intensity

21. State aid (II)
A special economic zone (SEZ) is a designated area in which manufacturing or distribution activities can be conducted on preferential terms
The purpose of SEZs is to support regional development
Currently, there are 14 SEZs in Poland, each consisting of several subzones
Total area of all SEZ – hectares
SEZ will operate until 2020
Permits to conduct activities in SEZ are issued by the authorities of each SEZ
Minimum investment: EUR 100,000
Possibility of including the land selected by an investor into SEZ
Benefits from obtaining a permit to conduct activities in SEZ :
eligibility for income tax exemption – a form of regional aid
plot of land prepared for an investment project, available at a competitive price
free assistance in dealing with formalities relating to the investment project

22. 14 Special Economic Zones
A special economic zone (SEZ) is a designated area in which manufacturing or distribution activities can be conducted on preferential terms
The purpose of SEZs is to support regional development
Currently, there are 14 SEZs in Poland, each consisting of several subzones
Total area of all SEZ – hectares
SEZ will operate until 2020
Permits to conduct activities in SEZ are issued by the authorities of each SEZ
Minimum investment: EUR 100,000
Possibility of including the land selected by an investor into SEZ
Benefits from obtaining a permit to conduct activities in SEZ :
eligibility for income tax exemption – a form of regional aid
plot of land prepared for an investment project, available at a competitive price
free assistance in dealing with formalities relating to the investment project
Pharmaceutical companies appreciate this kind of an incentive. Within SEZ operate: Adamed, Aflofarm, Polfa Łódź, Popharma.

23. Regional Aid Map in Poland 2007-2013
50%
40%
30 %
Small enterprises can enjoy maximum intensity limits increased by 20 percentage point,
medium-sized companies by 10%

24. Agenda I. Why Poland – Key Facts II. Foreign Investment - Advantages
III. Why Eastern Poland

25. Convenient location at the borders
Lithuania
Russia
Bielorussia
Ukraina
Slovakia
Baltic Sea
warmińsko-mazurskie
podlaskie
lubelskie
świętokrzyskie
podkarpackie
Territorial potential:
• 206 cities
• 6 cities over 100 thous. inhabitants
• 38 border’s crossing points between
EU and Eastern Europe
• 6 road’s and 5 railway’s
international transportation
corridors between EU and Eastern Europe
5 provinces:
• warmińsko-mazurskie
• podlaskie
• lubelskie
• świętokrzyskie
• podkarpackie

26. Investment asset of Eastern Poland
Young population
Investment asset of Eastern Poland
Birth rate at the leve of 2.7% (one of the highest in Poland)
31.8% of population below 25 years old
The highest increase in the group of population in production age in Poland •
16%
64%
20%
Population in pre- production age
Population in production age
Population in post- production age

27. Modern universities, professional staff
There are 53 universities in Eastern Poland (16 of them are ranked in the ranking of 2010 Top 100 Poland’s Universities) in which there are over 331 thous. students (17.4% of students in Poland). More than 47 thous. students are studying the technical faculties.
There are over 213 thous. students of the secondary vocational schools in Eastern Poland.
To the year 2013 Eastern Poland’s universities will implement 26 projects connected with modernization and development of their facilities worth 0.6 billion USD
Lublin is the eighth largest academic center in Poland

28. The lowest labour costs in the country
1 820 USD
1 540 USD
1 400 USD
1 260 USD
1 190 USD
1 120 USD
1 050 USD
The unemployment rate in Eastern Poland was 14.6% at the end of November 2010 and was higher than the unemployment rate for Poland (13.1%).

29. Renewable energy sources
BPO
Food sector
Logistics
Engineering industry
Metal industry
Renewable energy sources
Rzeszów 29

30. Wood, paper and furniture industry
Clothing industry
Aviation sector
Building industry
Nonmetal resources
Business Tourism
Wood, paper and furniture industry
Rzeszów 30

31. Foreign investors in Eastern Poland
Rzeszów

32. Major projects in Eastern Poland
Sector: wooden
Investment: 160 mln EUR
Employment: 230
Location: Orla
2010
Sector: automotive
Investment: 96 mln EUR
Employment: 500
Location: Chmielów
2011
Sector: aviation
Investment: 45,7 mln EUR
Employment: 250
Location: Jasionka
2010
Sector: aviation
Investment: 69 mln EUR
Employment: 418
Location: Jasionka
2009

33. What is unique in Eastern Poland?
Border’s location
Positive outlook for road infrastructure development
Highly skilled, young workers
Lower labour costs
High level of public support

34. The Agency Direct service and assistance to investors
Information on legal and economic environment
Investment offers database
Identification of suppliers and contractors
Contacts with central & local authorities, experts and lawyers
Exports promotion by EU financed Project (e.g Eastern Poland project)
Creating of a positive image of Poland abroad

35. Source: PAIiIZ, 2011.

36. Effective incentive system including EU-Funds
Why Poland?
Strategic location – gateway to the EU
Economic and political stability
Availability of skilled human resources
At the end let me summerise what are Poland competitive advantages:
First of all Human capital – very good qualified; flexible and loyal
Another factor - the lowest labour costs on the continent;
Then we have stable economy with perspective of fast growth.
And finally Investor friendly climate.
Effective incentive system including EU-Funds 36

37. Macroregion - Macrofuture
Thank you
Eastern Poland
Macroregion - Macrofuture
Polish Information & Foreign Investment Agency
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Warszawa
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