Winston Churchill once said: “There are few virtues which Poles do not possess and there are few errors they have ever avoided." Had he seen the GDP growth figures for Europe in 2009, he would probably change the second part of his statement, as Poland, with a 1.8% expansion, was the only country in the EU that did not record a contraction.
Poland continued this upwards trajectory in the following years, with economic growth reaching as high as 4.2%. And despite worrying signals coming from the eurozone, Polish consumers remain upbeat. According to a consumer confidence survey conducted by research company Ipsos, 85% of Poles give a positive assessment of country’s economic performance. Such optimism can be partially explained by the fact that the country's purchasing power per capita reached more than 60% of the European average, an all-time high for Poland.
Such positivity is further swelled by the stability seen within Poland's political landscape. In October, for the first time in the country's post-communist history, a party was re-elected with Donald Tusk’s Civic Platform 39% of the vote, ahead of the second-placed Law and Justice Party with 30%.
A learning curve
Though Poland's political scene is opting for more of the same, the make-up of its economy has changed dramatically over the past few years. The country has seen an influx of knowledge-based businesses starting up – as opposed to the labour-intensive industries that characterised the country for many decades – and has welcomed a steady inflow of business services, with a 94% average annual growth rate in shared servcies projects between 2007 and 2011, according to fDi Markets.
“We used to be big and cheap, now we are big and smart, as nearly 60% of investments to Poland are knowledge-related,” says Slawomir Majman, president of the Polish Information and Foreign Investment Agency, the government agency charged with attracting FDI. Mr Majman adds that one of the key factors attracting knowledge-based projects into Poland is the country's human capital. He says: “We have well-educated [professionals], but what is also very important is that there is no cultural gap between Polish workers and Western ones, which ensures smooth co-operation.”
Marcin Pankau of Poland's Outsourcing Institute agrees, adding that the “soft skills” of Polish employees, such as their ability to handle crises and think outside the box, along with a strong culture of loyalty, are factors that investors in the country cite as reasons why it will become one of the leading nearshore investment destinations in Europe.
Putting money to work
In less than a decade, the number of people employed in Poland's business services centres grew from virtually nothing to 69,000. Jacek Levernes, chairman of Poland's Association of Business Services Leaders (ABSL), forecasts that by 2013 employment in the sector will surpass 100,000.
Mr Levernes, who is also a vice-president of Hewlett Packard Global Business Services for Europe, the Middle East and Africa, says that the example of HP's business centre in Wroclaw shows why Poland is attracting so much attention from investors in knowledge-based industries. He says: “There is a real value here. Our employees speak 24 languages and that enables them to cover activities in about 35 countries. What is more, the level and complexity of services is on the increase as well: from simple financial back-office tasks to centres of excellence and specialisation in different functional areas such as HR, marketing and procurement.”
Roopa Kudva, CEO of Indian company Crisil Global Research & Analytics, also gives a glowing reference for the quality of Poland's business centres. Her company opened its Polish operations in Wroclaw in 2008, which serve as its hub for quantitative research services.
“We did comprehensive research across countries in eastern European before selecting Wroclaw [and] we are extremely pleased with our operations here. In addition to quantitative research, the centre helped us to provide services across multiple European languages. The overall working environment in Wroclaw is also conducive to the business, and the city has been very welcoming. We always found people to help us whenever it was needed,” she says, adding that in 2011 capacity of the centre has grown more than 100% and in the coming years she expects to expand the operations in Poland even further.
Keeping up the pace
One of the biggest foreign investors in Poland, General Electric, also praises the quality of the country's nearshoring services. “We currently employ 25,000 people in central and eastern Europe and more than 10,000 in Poland alone. We invest in Poland because it makes good business sense. It’s an attractive place to invest as [it gives access] to a highly productive and qualified workforce,” says Hugh Gillanders, the director of public affairs for Europe at GE Corporate.
However, Mr Gillanders says that Poland should further utilise cohesion funding from the EU to cement its position as a hub for investment in the region. “Poland should focus on infrastructure development, which will allow it to leapfrog [its competitors] in terms of its overall development, such as investing in the latest technologies,” he says.
Momentum certainly seems to be with Poland. However, only time will tell if the second part of Mr Churchill’s statement will remain a thing of the past.