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The Warsaw Voice » Special Sections » April 26, 2012
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Warsaw—A Regional Financial Hub
April 26, 2012   
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Warsaw is considered to be one of the most attractive business locations in Europe. It is now seeking to cement its position as a regional financial hub.

Warsaw is and will continue to be the capital of Polish business. Thanks to its favorable conditions for investment, the city generates more than 13 percent of Poland’s GDP and is home to around 20 percent of the companies operating in Poland. Most banks and other important financial institutions have their headquarters in Warsaw. The city is strongly favored by foreign investors, which is reflected in its rise in the European Cities Monitor league table to become one of Europe’s top 20 business locations.

Many factors contribute to Warsaw’s attractiveness. A major one is its geographic and geopolitical location. It has a population of 1.7 million, most of them young and well educated. And it is one of the most secure cities in Poland.

Under Warsaw’s development strategy until 2020, the city aims to strengthen its leading position. The municipal authorities are taking measures to support the development of the capital as a regional financial hub; they are investing in road building and public transport, making it easier for investors to obtain building permits and promoting opportunities to investors.

The Warsaw Stock Exchange (WSE) is the core of the financial hub. It is already the largest market in the region and ranks second in Europe after London in the number of IPOs that debut on the market. The WSE is the leading exchange in Central Europe in terms of capitalization, having surpassed the Vienna bourse, as well as in turnover, number and type of instruments listed, and organizational and technological solutions.

The WSE’s top goal for the coming years is to solidify Warsaw’s position as a financial hub for the region. Among its advantages for foreign issuers planning an IPO in Poland is the presence of a large, stable and diversified pool of investors. This guarantees the availability of capital, considerably improves chances of the initial offering’s success and ensures an attractive price for the stock at the first and subsequent trading sessions.

Thanks to the strength of the Polish economy and the rising position of the WSE, Warsaw is growing in importance for this part of Europe. “My ambition is for Warsaw to become a more attractive city than Prague and Budapest,” says Warsaw Mayor Hanna Gronkiewicz-Waltz. “And I think that it is no exaggeration to call Warsaw the 21st-century capital of Central and Eastern Europe.”

The numerous investment projects under way in the city, especially investment in infrastructure, contribute to strengthening Warsaw’s position. Since 2007, the city and the companies based in Warsaw have invested around zl.18 billion in new projects. Adding money from the state coffers, the investment figure totals zl.33 billion. Since Warsaw’s foundation, there has never been so much money invested in the city.

Warsaw’s growing position as a business location in Europe and beyond is reflected in its high rankings in various business attractiveness league tables. Warsaw ranks No. 12 among top business locations around the world, according to a report by real estate services company CB Richard Ellis (CBRE), CBRE Business Footprints. Global Office Locations 2011. More than 150 multinational corporations are based in Warsaw.

“Warsaw is ranked as the fifth most attractive business location across all emerging markets; 150, or 53.6 percent, of 280 international companies surveyed have their offices in the Polish capital,” says Joanna Mroczek, director of the Research and Consultancy Department at CBRE in Poland, noting that Warsaw’s 12th place worldwide ranking is just behind New York (11th place) and Paris (10th place). “This shows that Warsaw has become one of the most significant business centers in Europe,” she said. “For international corporations, Warsaw is as important a location as the most economically developed capitals and business centers. Large corporations will be followed by smaller players on the market, which shows the development potential of Poland and its capital.”

In the latest edition of the annual European Cities Monitor (ECM) report, Warsaw was ranked first, ahead of Bratislava, Lisbon and Prague, in terms of the low cost of staff. It was also ranked high—in third place—for the climate created for business by government; in this ranking Warsaw was ahead of Amsterdam, Berlin and Budapest. In the ranking of cities expected to see the largest influx of investment in the next five years, Warsaw was second, behind only Moscow. The ECM report is prepared on the basis of surveys conducted among senior executives from 500 European companies.

In a 2011 report on investment prospects prepared by PwC and Urban Land Institute, Warsaw was ranked 10th, moving up three places compared with the previous year. The city was ahead of Prague, in 17th place, and Budapest, in 25th place. The developers, financial institutions and property management companies who were surveyed expressed the view that Warsaw’s real estate stock is well adjusted to the needs of the market.

And yet another 2011 survey, by ECER-Banque Populaire, of 170 entrepreneurs from 37 cities in 18 European countries found only Frankfurt and Malmo, Sweden, were considered more attractive than Warsaw. The Polish capital, which jumped from 10th place in 2010 to third, was favored over Berlin, Paris, Prague, Budapest and even London. The survey listed Warsaw’s primary advantages as its access to financial support for SMEs (small and medium enterprises) and flexible labor law in comparison with other countries.
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