Reduced market entry thresholds, a simplified qualitative assessment of investment projects, and a higher level of support in selected locations are the major changes in the government's grant programme that could attract more business services investors to Poland.
We can say that the initial shock and pausing of investors’ plans in the business services sector is already behind us. For some time now, we have been seeing an increasing number of companies from this industry locate their most advanced business processes from various countries, including Asian as well as some Easter European countries, to Poland. A number of companies from Western Europe, including the UK and Switzerland, which are looking to access qualified employment pools at competitive cost levels, are also looking at Poland. The country’s attractiveness to foreign companies is even greater because business services centres in Poland can apply for state aid, which is unavailable in other European locations. Recently, the state aid support programme was amended to better address the needs and expectations of investors,
commented Iwona Chojnowska-Haponik, Business Location Consulting Director, EMEA, JLL.
- Lower entry thresholds
Previously, the requirements to receive financial support by a business services centre was to create 250 jobs and invest PLN 1.5 million. Now, a large investor making their first investment or expansion on the Polish market is required to employ 100 people and incur a capital expenditure of PLN one million within a five-year period. A quality assessment of the project will determine the exact scope of state aid,
explained Rafał Szajewski, Business Location Consulting Director, EMEA, JLL.
We have seen for some time that the scale of new investment projects is smaller. The growing maturity of the industry is illustrated by business services centres focusing on the quality of processes rather than quantity. Less advanced services are increasingly being automated. On top of this, if a centre’s operations expand, then the company has the opportunity to apply for incentives once again. One cloud on the horizon involves the European commission and its changes to state assistance which will come into effect at the beginning of 2022. This may see state assistance for new investments become very much limited in a number of countries. However, this concerns Poland to a lesser extent because in some of the country’s regions the state aid level will in fact increase,
added Rafał Szajewski.
- Simplified assessment process
- Level of support
Such a policy of awarding grants is an important step towards levelling the playing field between different regions of the country. The winners may be smaller cities, such as Rzeszów or Białystok, which have less in the way of sector investments, but do have substantial labour markets,
adds Rafał Szajewski.
It is important for companies to be able to fully assess opportunities and risks so that they can fully utilize tax exemptions and grants. With this in mind, the maturity of the business environment, which can offer comprehensive advisory services based on know-how and previous experience, is extremely important. Advisory firms, such as JLL, as well as investor assistance offices and thriving industry and business organizations, work hand in hand to increase foreign direct investment in Poland. As a result, despite the disruption caused by the pandemic, the business services industry in Poland looks set for an even brighter future,
says Iwona Chojnowska-Haponik.
