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The Polish economy needs a strategy for industrial development

The state should stimulate the development of industry primarily through the support of innovation. Another important factor is supporting the cooperation between large companies which benefit from the economies of scale and smaller businesses which are capable of introducing innovative solutions more rapidly; this fact was emphasized by the participants of the debate held at the editorial office of the Dziennik Gazeta Prawna newspaper.

In the course of the debate, the current role of the state in determining the shape of the development of the Polish industry was assessed; the participants of the discussion also attempted to provide an answer to the question of what industrial policy does the Polish economy need.

Lack of long-term planning Mr Zbigniew Jagiełło, chairman of the board of PKO Bank Polski, emphasized that the state should care for entrepreneurs since it is them who generate the national GDP and it is them who pay the taxes upon which the state budget is based. – The state should make greater efforts aimed at the promotion and implementation of crucial economic strategies, especially in the area of industry. Long-term thinking is still something that is largely absent in Poland. Many sectors of industry have nevertheless managed to attain success – the foodstuffs industry can serve as an example. However, one should never rest on one’s laurels. Poland can benefit from advantages such as its favourable geographic location and its climate, which is good for agriculture. These advantages should be exploited by developing the foodstuffs sector and by selling more processed products, not only domestically but also abroad – Mr Jagiełło stated.

Supporting technology transfer Mr Maciej Bukowski, PhD, the chairman of the Warsaw Institute for Economic Studies, emphasized that the state remains a major player on the market. Not only does it provide employment, but also acquires a substantial part of the output of companies which operate in the manufacturing sector.

In addition, it also creates legislation and adopts decisions on the functioning of the treasury bodies, the justice system or the educational system, including vocational schools. Enterprises need to adjust to their current environment. It is for that reason that one should continue to discuss the role of the state in the economy. A dialogue between the representatives of the business community and the representatives of the government is necessary to achieve this goal – Mr Bukowski noted.

One must always be ready for the worst of times Mr Zbigniew Jagiełło also pointed out that 25 years have passed since the beginning of economic transformation, with the last 23 years forming a period of uninterrupted economic growth. However, economic growth is not something to be taken for granted.

– In the future the situation may not necessarily be as good as it is now. We must also be prepared for periods of stagnation or recession. For this reason, the existence of a strong industry is of crucial importance for the economy. Enterprises operating in the manufacturing sector fulfil a very important role due to the fact – among other things – that they employ individuals who represent various professions and who posses various skills and different levels of educational qualifications. Companies of this kind generate a measurable added value and create jobs for all Polish citizens – Mr Jagiełło emphasized.

At the same time, he also pointed out that enterprises incur three types of costs: costs of employment, costs of energy and financial costs. The latter category of costs currently remains at a low level, which results in new opportunities.

– At the present stage the interest rates are at a record low. They are also unlikely to increase in the nearby future. This constitutes an opportunity for enterprises to secure external financing on favourable terms; companies should take advantage of this opportunity by extending the scope of their activities – Mr Jagiełło added.

Cooperation between businesses Mr Robert Świechowicz, vice-chairman of the board at PESA Bydgoszcz, pointed towards the immense significance which cooperation between big businesses and smaller companies has for the functioning of the economy. Such cooperation is very good for business and has proven its worth in many developed countries, such as Germany.

– PESA Bydgoszcz cooperates with more than 1.5 thousand suppliers, employing approximately 80 thousand people in total. These companies continue to develop along with us, increasing their technological levels, providing training to their personnel, investing in research, development and various certificates. We are developing together. It is in small and medium enterprises that one can see the influence of big businesses and industry leaders on the economy most clearly – Mr Świechowicz said.

Priority task The enhancement of cooperation between companies remains a priority, especially since the number of large industrial corporations in Poland remains low. In the recently published Global 2000 ranking of the world’s biggest businesses there were only 6 Polish companies, with the largest of them all – PKO Bank Polski – being a company operating outside the industrial sector.

Support for innovative projects The Industrial Development Agency (Agencja Rozwoju Przemysłu S.A.) plays a significant role in the area of providing support for enterprises. At the present stage, the Industrial Development Agency, according to its new strategy, focuses on providing support to innovative projects. – For many years, the activities of the Industrial Development Agency were associated with the financing of complicated restructuring processes. Even though we are still active in this area, innovation has now become an important part of our activities. The Agency cooperates with companies which seek support for innovative projects and investments. It is all about ensuring that adequate support is provided to companies in order to make an effective contribution towards their development – said Mr Marek Szczepański, vice-chairman od the Industrial Development Agency. He emphasized that the funds provided by the Agency supplement the services provided by banks.

– The Industrial Development Agency, by implementing the policy of the state, offers loans earmarked for development purposes to large companies; in most cases, the loans are granted for a period of up to seven years. According to the new strategy, small and medium companies which engage in the implementation of innovative projects are also eligible for both debt financing and equity financing – he emphasized.

Mr Szczepański also reminded that the Industrial Development Agency is about to launch the Technology Transfer Platform. This platform will make it possible for companies to share innovative technologies and will make it easier to commercialise such technologies.

Multidimensional policy Ms Beata Lubos, head of the section in the department for innovation and industry of the Ministry of the Economy, pointed out that industrial policy is multifaceted in nature. This is because it constitutes a kind of superstructure positioned above the shifting legal regulations, the implementation of innovative solutions and the actions aimed at the development of personnel skills.

– The role of industry is greatly appreciated by the Ministry of the Economy. The Ministry of the Economy remains an ambassador of industrialisation, including, inter alia, in the course of negotiations with the European Commission. Owing to our efforts, extensive funding for innovation is available to entrepreneurs – Ms Lubos ensured. She also pointed out the need to create mechanisms which shall allow state institutions to respond in an efficient and effective manner to any needs of the industry which may arise (swift response mechanisms).

The success stories of domestic companies and industrial culture Mr Robert Świechowicz stated that in most cases innovativeness accounts for 20% of the success of the given product on the market, with good work quality accounting for the remaining 80%.

– We need such domestic success stories because they contribute towards the increase of our industrial culture – Mr Robert Świechowicz said. He emphasized that, as a rule, enterprises should first extend their scope of business and reinforce their position on the domestic market; an entry into foreign markets should only be contemplated once the above objectives are achieved. At the same time, the vice-chairman od PESA Bydgoszcz also pointed out that the advantage enjoyed our companies due to the relatively low level of salaries is slowly being eroded away. This is because salary levels in Poland are rising gradually.

The Dziennik Gazeta Prawna newspaper, along with the PKO BP bank, has organised an expert debate entitled “What industrial policy does the Polish economy need?.

The meeting took place on May 7, 2015 in the editorial office of Dziennik Gazeta Prawna between 12.30 and 14.30.

The participants of the meeting were:

Mr Zbigniew Jagiełło, Chairman of the Board, PKO BP; Mr Maciej Bukowski, Chairman of the Board, Warsaw Institute for Economic Studies; Mr Marek Szczepański, Vice-chairman of the Board, Industrial Development Agency; Ms Beata Lubos, Head of the Section for Innovation Policy, Innovation and industry Department, Ministry of the Economy; Mr Daniel Maksym, Section for the Development of Infrastruture for Research and Development, National Centre for Research and Development; Mr Robert Świechowicz, Vice-chairman of the Board, PESA;

The moderator of the meeting was Mr Marek Tejchman, deputy editor-in-chief of Dziennik Gazeta Prawna.

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