Poland set to benefit from post-COVID global business

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Poland is developing upwards in terms of the type of operations that global companies are entrusting the country’s employees with and is becoming a hotter location for nearshoring, says a recent report by JLL and Hays. 

The following news items appeared in PT Daily, Poland Today’s daily business newsletter, on Monday 21 June – free to register here

Poland one of the biggest beneficiaries of post-COVID global business

Companies around the world have been forced by the economic effects of the COVID-19 pandemic to review their location strategies, resulting in the increased favouring of nearshoring over offshoring – and Poland may be one of the biggest beneficiaries, according to a recent report by global real estate services company JLL and recruitment & human resources company Hays entitled ‘Onshore, Nearshore, Offshore: Unsure?’. Onshoring is the practice of transferring a business operation that was moved overseas back to the country from which it was originally relocated, while Nearshoring is when a business operation is transferred to a nearby country, especially in preference to a more distant one.

“Poland remains… a top outsourcing destination thanks to its stable economy, extensive talent pool and well-developed infrastructure,” wrote Iwona Chojnowska-Haponik, JLL Poland’s Director of Business & Location Consulting. “What is more, the latest changes in the state aid support programme, including reduced entry thresholds, a simplified qualitative assessment of investment projects and a higher level of support in select locations, make the Polish incentive system one of the most attractive in the region,” she added. 

“According to ABSL representatives,” the report continues, referring to the Association of Business Service Leaders, “Poland is currently home to 1500 BPO, SSC, IT and R&D centres which employ nearly 350,000 people. Since Q1 2016, the total number of jobs in the business services sector has increased by 58%. Along with the sector’s growth, processes performed in these centres have shifted from simple, single-function operations to more advanced and higher value-added functions. Today investors increasingly opt for end-to-end processes which support operations on a global scale as well as establishing sophisticated functions such as R&D, knowledge process outsourcing or software development.” 

The report is packed full of insights and information, and one that stands out is that 94% of foreign investors in Poland would be willing to reinvest. 

 

Government proposes more ways to boost low birth rate

The government has presented the main conclusions of the 2040 Demographic Strategy project, a draft plan to support families and encourage them to have children, as reported in Business Insider. “If we do not strengthen state support for families, then in a decade or two there will be a collapse, paralysis in the pension system, slowdown in economic growth and Poles will not be able to fulfill their ambitions and aspirations in Poland,” said Prime Minister Mateusz Morawiecki.

Under the plan, the government wants to offer flexible work and a guarantee of part-time employment for parents of children up to four years old. It would also like to introduce a “Family caring capital” instrument up to the amount of PLN 12,000 per child and to assist families in buying a house or an apartment. “We do not have to convince Poles to have children, but looking at the demographic data, we can see that the real situation is far from dreams and plans,” said Barbara Socha from the Ministry of Family and Social Policy.

Poland’s birth rate has declined dramatically over the last half century or so. In 1960, according to World Bank data, the country’s birth rate averaged 2.98 births per woman. In 2019 it was 1.42, putting Poland in 180th place out of 200 nations and territories, and well below the accepted ‘population replacement’ figure of 2.1. 

 

Czechia considers withdrawing Turów complaint

The Czech Minister of the Environment, Richard Brabec, said that the country is considering the possibility of withdrawing its official complaint relating to the Turów lignite mine in Poland near the Czech border, if Poland meets certain conditions. “I would not like to talk about specific requirements, this is something that has yet to be negotiated,” said Brabec. He added that the agreement prepared by representatives of the Polish and Czech governments has not yet taken final shape. Brabec said that the case of Turów is multi-stage and “it does not end with withdrawing the complaint and accepting the conditions by Poland”. Czechia launched a lawsuit against the mine in February 2021 and in May Poland defied an injunction by the European Court of Justice to Poland to close the mine, which lies near the Czech border. 

 

CCC to list its e-platform

Polish footwear retailer CCC confirmed its plans for an initial public offering (IPO) of its online shoe shop e-obuwie by 2022-2023, according to the chairman of the supervisory board, Dariusz Miłek. The platform operates on 17 European markets, offering more than 560 brands, and is considering entering more countries, including Greece. “E- obuwie is on a growth path and is not slowing down. We have invited new shareholders to join, we are strengthening the management and are planning an IPO in 2022-2023”, said Miłek.

Thanks to its esize(dot)me project, helping customers to choose the right size of shoes, and a network of brick-and-mortar stores, the company is heading towards the integration of online and offline sales channels, it said. CCC first came to existence by that name in 1999, according to the company’s website, but existed earlier than that under the name of ‘Miłek Trading Company’. CCC stands for ‘Cena Czyni Cuda’, which roughly translates as ‘the price is making miracles’. The company itself is listed on the WSE and at the end of 2019 it had 1242 stores and employed 15,618 people. 

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Written by: Richard Stephens