Doing business in Poland


As you probably know thanks to various media, Poland with its GDP increased by 3.3% in 2014 is the fastest developing country in the EU. The domestic market is huge as there are 38 million citizens. Its strategic location allow you to have direct access to emerging eastern European markets. Thanks to the fact that Poland is one of the EU member states, it will have received 105.8 billion Euro by 2020. On top of all this, there is a great, well-educated workforce. It shouldn’t then take much convincing to expand your business to Poland. Let’s have a look at what challenges you may encounter and what the opportunities and growth potential are.

Challenges

The UK and the Polish markets are fairly similar and if you succeeded in the UK, the chances are that the same product will be successful in Poland. Unfortunately, you may encounter some difficulties on the way there. There is a vast amount of bureaucracy in Poland and it doesn’t really compare to the UK. You may also notice that the Polish market is a competitive one and that tax administration is not very clear. Speaking of money, you need to take into consideration existing tax burden and corruption. On top of that, the judicial system is quite slow. However, if you face all these challenges, you should be just fine.

Opportunities

Poland has received  85.2 billion Euro to stay a market offering growth, stability and good prospects for the UK businesses. It is a good option for the UK as it is easily accessible, English is widespread among Polish businesses and Poland is an entry point to the eastern European countries. Also, thanks to the EU, there are improvements in the energy, transport and infrastructure sectors.

Thanks to the fact that Poland is the EU member state and also belongs to the WTO, companies producing goods in the UK are exempt from import duties.

The main products that the UK is already exporting to Poland are electromechanical products, chemicals and mechanical devices.

Opportunities in certain sectors

Energy

Poland is planning on building 2 3-gigawatt nuclear plants. It is hoped that it will make up around 17% of its energy source. What does it mean for the UK business? It creates the opportunity in regulatory capacity building, R&D transfer, supply of all elements of the fuel cycle and consultancy and project management.

Railways

In order to create an advanced trans-European rail network, there is going to be 25 billion Euro investment in Polish rails until 2030. This creates the opportunity in

  • planning and development
  • development of technical standards and regulation
  • supply of rail technologies
  • supply of rolling stock, including subcomponents
  • operational maintenance
  • project and commercial management

Security

Security sectors is a bit more diverse as it focuses of a few kinds of security. There are some strategies already in place, i.e. national security strategy, a national critical infrastructure protection programme or a program focusing on making Poland more digital.

When it comes to cyber security, Poland focuses on rapid development of mobile internet and e-services and on creating good cyberspace protection.

Another area that needs development is critical data security when it comes to cloud computing and mobile devices.

The UK companies can find opportunities in the following sectors:

  • CCTV monitoring systems for cities, transport systems and intelligent buildings
  • access control solutions
  • cutting edge solutions for homeland security services, including surveillance, security and communications equipment
  • Information Technology (IT) security solutions for public administration, businesses and individuals
  • cyber security solutions including those for critical infrastructure areas

Financial and business services

The financial market in Poland is well-regulated and stable. Around 70% of the banks in Poland are owned by a foreign parent companies. Below you can find opportunities in this sector:

  • FinTech, specifically digital banking, Big Data, mobile payments and cybersecurity
  • legal and financial consultancy as Public Private Partnership (PPP) / EU funds hybrid projects are used more widely
  • private health insurance with less than 800,000 Poles currently paying for private healthcare policies

Retail

Poland’s retail sector market is highly competitive but there is huge potential for new UK entrants. Poland has the largest retail market in the CEE region. It has:

  • a growing middle class
  • increasingly sophisticated consumers looking for new, high quality products

Opportunities include:

  • opening stores in new and existing shopping malls
  • online retail
  • the potential for growth in mobile (M) commerce
  • innovative solutions such as mobile payments solutions for retail
  • warehousing, especially for e-commerce
  • premium UK food products

Healthcare

Polish healthcare is Europe’s:

 

  • seventh largest market in terms of patient numbers
  • second largest by spend per capita

The Polish government only spends 7.5% of GDP on healthcare. However, the private healthcare sector is continually expanding and currently covers one third of the market by value.

 

EU funds 2014 to 2020 will be mainly spent on healthcare infrastructure. Public hospitals are obliged to modernise their premises and upgrade equipment to EU standards by the end of 2016.

High annual growth rates are expected for:

  • over the counter (OTC) products and food supplements (market value 2014: £160 million) at 6%
  • image diagnostics (market value 2014: £400 million) at 15%
  • in vitro diagnostics (market value 2014: £215 million) at 9%

There are also opportunities for:

  • specialised medical equipment, particularly for hospitals
  • telemedicine solutions and diagnostic equipment
  • e-health as part of a new Digital Poland 2014 to 2020 Programme
  • clinical trials
  • building new or buying existing private centres
  • small Public Private Partnership (PPP) projects

 

It is evident that there are plenty of opportunities for the UK investors and businesses to benefit from expanding to Poland. Not only there are many sectors to choose from but also within each sector, there is a wide range of business opportunities.

 

(Source: https://www.gov.uk/government/publications/exporting-to-poland/doing-business-in-poland-poland-trade-and-export-guide)

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