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The Warsaw Voice » Business » June 29, 2012
Business & Economy
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Poland to Benefit from Euro 2012
June 29, 2012   
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Polish soccer players may have disappointed fans, but the Euro 2012 tournament that Poland hosted together with Ukraine in June is expected to produce lasting benefits for the country.

Experts agree that the greatest benefit for Poland from hosting the championships is infrastructure such as freeways, railways and airports built and modernized in the run-up to the event. The tournament also offered an unprecedented opportunity to promote Poland as an attractive tourist destination.

Total spending related to Poland’s preparations for Euro 2012 is estimated at zl.85.4 billion, or 5.2 percent of the country’s GDP, with 86 percent of the total amount spent on transport infrastructure and 5 percent on sports facilities and hotels.

In a report called Euro Champion 2012, analysts from Erste Group say that investment in freeways, railways and airports will bring the biggest benefits to Poland as well as the other host nation, Ukraine. Before Euro 2012, the two countries’ transport infrastructures were in a much poorer state than in Austria and Switzerland ahead of the 2008 tournament which those two countries hosted. Another host nation, Portugal, was also more developed in transport terms before Euro 2004.

Poland had the fourth least developed network of freeways in the European Union and the quality of its roads left much to be desired—despite the fact that Poland has a strategic location in Europe and is among the countries that see the highest transit of goods through their territory. The state of Poland’s railway infrastructure was even worse.

The Erste Group analysts say the investment in infrastructure is likely to produce many indirect benefits. Apart from boosting the efficiency and competitiveness of local producers, it will attract more foreign investment to the country, which is especially important at this time of crisis. The disastrous state of Poland’s infrastructure was one of the biggest barriers discouraging investors from coming to Poland.

Poland’s Ministry of Sport and Tourism projects that Euro 2012 will contribute anywhere from 1.4 percent to 2.7 percent to the country’s GDP. This growth will be spread over several years—from 2008 to 2020. Euro 2012 is also expected to spur the growth of the underground economy in Poland and Ukraine, though its exact impact is hard to estimate.

The Polish economy should be helped by a rise in incoming tourist traffic. In 2011, the number of tourists visiting Poland increased to 13.1 million from 12.4 million in 2010. Euro 2012 was expected to attract to Poland an additional 500,000 to 700,000 tourists, and each of them was expected to spend around 800 euros while here, according to the Erste Group report.

But tourism-related benefits will be short-term in nature, Erste Group says, and the money that the soccer fans have left in Poland will only be enough to cover one-off expenses, for example spending on security precautions.

Long-term benefits from tourism are debatable, according to the analysts. The Barcelona effect—involving a rise in a country’s tourist attractiveness following a major event held there—is rare and depends on a combination of many different factors, they say. This is why a short-lived surge in tourism is unlikely to contribute to Poland’s economic growth in a major way, the analysts add.

Dariusz Wojtal, vice-president of the Polish Tourist Chamber, says that the European soccer championships will produce both short- and long-term effects for Poland’s tourist sector. “The short-term effects are often negative,” he says. “Paradoxically, it is outbound travel agencies that have benefited the most from Euro 2012. June was virtually lost for incoming tourist operations. Fears of increased traffic and problems with moving around—as many roads and freeways are still under construction—in addition to a sharp rise in hotel and restaurant prices during the tournament have combined to lead to a decreased interest among tourists in visiting Poland.”

But the long-term effects will be positive and contribute to establishing Poland’s image as a modern and open country attractive to tourists, Wojtal says. In the two or three years following Euro 2012, there should be a significant increase in foreign tourists’ interest in Poland, he says. The development of infrastructure—airports and the connections to the city centers, freeways, expressways and urban transport—will contribute to this, Wojtal says.

The Polish Tourist Organization (POT) launched a multimedia promotional campaign for Poland a year before Euro 2012. The campaign was chiefly targeted at German, French and British fans, who regularly attend international soccer tournaments. The primary goal was to change stereotypes of Poland and Poles in those countries.

According to the POT’s Adam Zaborowski, the organization will continue with its promotional efforts after the tournament.
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