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The Warsaw Voice » Regional Voice » April 28, 2011
Special Section: Eastern Poland
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Eastern Poland Macroregion
April 28, 2011   
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The Eastern Poland Macroregion comprises five provinces: Lublin, Podkarpacie, Podlasie, 安i皻okrzyskie, and Warmia-Mazuria. The macroregion covers 31.6 percent of Poland’s total area and is inhabited by 8.2 million people, which accounts for 21.5 percent of the country’s population.

Among the macroregion’s strengths is its location near the Polish border, offering opportunities to establish trade contacts with neighboring countries, and the presence of border crossings along the EU’s external border, which serves as a “gateway to the East” for all EU countries. Eastern Poland is crossed by transport corridors from Western Europe to Belarus, Ukraine, Slovakia and Russia and from Scandinavia to southern Europe. It offers many sites and post-industrial facilities to prospective investors in ecologically clean areas. Eastern Poland also has favorable natural conditions, which creates ample opportunities for the development of tourism.

The macroregion is an attractive place for foreign investors because of the availability of relatively cheap land and facilities, well-qualified labor, with lower labor costs than in other EU countries, and a continually upgraded transportation infrastructure in keeping with the government’s long-term plans for the construction of expressways and freeways. Several important roads will be built and modernized in the macroregion over the next five years. The A4 freeway from the Polish-German border to the border with Ukraine will cross Podkarpacie province, while the A2 freeway from Poland’s western border to Belarus will run across the northern part of Lublin province. Additionally, many sections of some national roads, including road no. 7 from the city of Kielce to Warsaw and Olsztyn, road no. 8 from the city of Bia造stok to Warsaw, and road no. 17 from Lublin to Warsaw, will be modernized to meet expressway standards.

Two important trans-European transport routes running across Poland’s eastern provinces may be built in the second half of the next decade: Via Baltica, from the border of Lithuania to Warsaw via the cities of Suwa趾i and υm瘸, and Via Carpatia, from the border with Belarus to the border with Slovakia via the cities of Bia造stok, Lublin and Rzesz闚.

The macroregion offers well-educated and qualified workers, with labor costs lower than elsewhere in Poland. The qualified labor resources are supplied by well-developed university centers in the five provinces, mainly in the cities of Lublin, Rzesz闚 and Bia造stok. There are 12 public universities in Eastern Poland, including universities of technology, medical universities and universities of life sciences.

Low labor costs coupled with high qualifications are an optimal and particularly desirable combination for foreign investors. This is particularly important in the case of investment in labor-intensive sectors where wages account for the largest part of the business costs. This factor is a strong point of the macroregion, especially considering that the business sectors developing in eastern Poland—including some segments of the agri-food industry, and the wood and furniture industry—are relatively labor-intensive.

Another labor-intensive sector is the service industry. Services with exceptionally favorable conditions for development in eastern Poland include tourism—mainly because of the natural assets and agricultural character of the region – and business services, among them Business Process Outsourcing (BPO). This last form of activity is gaining importance in the global economy. In an effort to cut costs, companies are increasingly outsourcing some of their non-core business tasks to specialized external firms. Internationally, Poland is perceived as a country with large resources of educated and cheap labor. The provinces of eastern Poland may look especially attractive in the process of attracting BPO investment.

The environmental conditions in eastern Poland are conducive to business activities based on the use of the region’s environmental assets. The eastern provinces are free from heavy industry and their waters, forests, air and soil are relatively clean. With sufficient promotional support, the environmental attractiveness of the region may become one of the factors attracting investors.

Farm tourism and organic food production are among the key sectors that may develop thanks to the region’s natural values. Additionally, a clean and attractive environment creates favorable conditions for the construction of sports facilities, health resorts, spas, and beauty and fitness centers.

In today’s tourism industry, preference is increasingly given to vacations far from heavily urbanized areas with low human impact on the environment. While accommodation is still scarce in many areas in eastern Poland, the environmental attractiveness of the macroregion could become a factor drawing investors to its tourist sector. In this case, not only Warmia and Mazuria, but also Podlasie and Lublin provinces would benefit. Although these two provinces are less attractive to tourists, they boast a high level of environmental cleanliness.

Analysis of the economic potential of eastern Poland helps identify the sectors in which activities aimed at attracting investors can be particularly successful:

Lublin province: agri-food, furniture and automotive industries;
Podkarpacie province: automotive, aerospace, metal, and wood and paper industries;
Podlasie province: agri-food, and wood and paper industries;
安i皻okrzyskie province: manufacture of products made of non-metallic materials, including ceramic products and building materials, metal industry;
Warmia-Mazuria province: furniture, wood and paper, and agri-food industries.

It should be remembered that, in addition to Regional Operational Programs, the Eastern Poland Macroregion has access to assistance in the form of the Development of Eastern Poland Operational Program in the 2007-2015 financial period. Under this program, measures are taken that directly contribute to enhancing the investment appeal of the macroregion, in terms of both investment in physical infrastructure and comprehensive promotion. All these efforts complement one another, creating a synergy effect.

Analysis of the Economic Potential of Eastern Poland, February 2010.
Report for the Polish Information and Foreign Investment Agency.

The activities of investor services centers include:
- working with PAIiIZ to provide assistance to foreign investors interested in launching business operations in a given province
- handling investment projects entrusted to investor services centers by PAIiIZ (“small” investment projects)
- seeking out and updating regional investment proposals (both greenfield and brownfield)
- developing databases of prospective suppliers and cooperating partners for investors in different sectors of the economy
- gathering a range of information related to promoting the province or the region’s investment climate, including information on economic conferences involving investors and regional authorities, forms and results of investment marketing conducted by investor services centers and regional authorities, major improvements to infrastructure in the region.
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