Strong Labor Support for New Business
Strong Labor Support for New Business
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  • 승인 2006.12.01 12:01
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Country Report / Poland IT Poland offers advantages its neighbors cannot On the occasion of Poland Independence Day on Nov. 11, the Korea IT Times had an interview with Urszula Raznowiecka, Charge d'Affaires a.i., Embassy of the Republic of Poland, focusing on Poland IT industry. -- Ed. Q: Please describe the relative importance of IT industry for the economy of Poland. The IT industry belongs currently to the fastest growing sectors of the Polish economy with over 2 times higher growth rate than annual growth of Polish GDP. GDP growth amounted to 3,8% in 2005 and is estimated at over 5% in 2006. This makes the IT sector one of the most dynamically developing sectors of the Polish economy and shows that the Polish market is still not saturated. The importance of the Polish economy is very marked. I would like to enumerate several factors which are as follows: * First of all, the IT industry creates products and services with highest added value, contributing considerable amounts to overall economy. * Secondly it creates technological development in other sectors of the economy enabling and stimulating better allocation of resources. * IT industry development is in line with the governmental programme towards knowledge-based economy (KBE). Importance of IT related industry requires outstanding qualifications and skills. For Polish economy it means development of research & development centers as well as modern educational system to keep pace with IT world leaders. * Last but not least, IT industry becomes important area of direct investment of foreign companies creating new valuable jobs. Polish IT products incl. software become at the same of Polish promising export goods. Q: Please assess the comprehensive IT industry in Poland at present. According to the forecasts during next 3 years, the market will continue to grow at the high rate aiming at 10% owing mainly to Poland's accession to the European Union, rapid increase of investments and the fact that it is not as saturated as the markets of western Europe. For example, Poland has by far the largest number of Internet users among the new members of the European Union. Considering the future growth it offers also the highest potential due to society size larger that all new member states combined. Recently Poland became active producer and exporter of IT solutions. The IT exporter club, set up to support products and services trade of Polish companies, currently has 188 members engaged in European and international projects. Competitiveness of IT export is however not the only feature of Polish IT industry at present. The forefront of over 6 thousand IT companies active on the Polish market includes both Polish branches of the world's top corporations like ABC Data/Actebis, HP, Microsoft, Oracle, SAP and also Polish companies well known in EU like Action, ComputerLand, JTT Computer, Prokom Software, and Softbank. It shows that Poland is well recognized place for investing in IT business but also develops IT solutions using its domestic human resources as well as R&D. Companies located in Poland offer a full scope of IT services for all type of industries. At the end it should be mentioned that sales of desktops, notebooks and mobile phones records dynamics of almost 30% annually. The key challenges for further development of the Polish IT sector is unlimited access to the Internet at prices available for average users. This can be achieved only by increasing the number of ISP's offering diversified network access including fixed phone lines but also LMDS radio access. Q: What do you think of current bilateral relations between our two countries in terms of IT collaboration Current trade and investment relations between Korea and Poland are very promising. Our trade exchange is rising fast and Korean companies consider Poland as their platform and center for European sales and operations. Good examples can be LG group which will soon become leader in manufacturing investments owing to investment projects of LG Philips, LG Electronics and their big suppliers. Technological development of their products will definitely require stronger collaboration in the IT field like software, and telecommunication technologies. Current cooperation in terms of IT is a challenge for both countries taking into account potential of both economies. There are however still not many IT projects realized or implemented together by Polish and Korean partners. I deeply believe that this is the best time to change it. Korea is known as one of world leaders in IT business. Poland can offer good prospects for development due to its links to the EU, and well educated labour at competitive costs. These aspects and advantages of our countries would definitely match each other. Q: What can be done to foster increased IT collaboration between our two countries First of all faster and increased cooperation on the IT level depends on individual companies. Both sides have to be well informed about the activity of their counter partners. Practically speaking Polish IT companies offer all types of possible IT services and products and base on state of the art applications. Good solutions for the increase of cooperation could be among others: * Promotion of participation in trade fairs and exhibition related to IT industry in Korea and Poland. * Cooperation between chamber of commerce related to IT industry through the exchange of experience and market information. * Holding seminars and business-to-business conferences for companies interested in closer cooperation with corresponding market. Q: How would you compare Poland's competitiveness with other countries in Europe in terms of IT competitiveness in recent years Our IT competitiveness is based mainly on 2 aspects, IT products and service costs and the quality of labour related to IT industry. The costs of IT solutions as well as the cost of other services and industries is definitely lower in Poland than in other European economies -- especially the so called Old EU. Definitely, among the main factors generating the cost of IT solutions and services is the labor cost. The labour cost in Poland belongs to the lowest in Europe. International comparisons point out that labour costs in Poland can be 8 times lower than in remaining EU economies like Germany, France or Belgium. At the same time the predicted growth rate of nominal salaries shows that until year 2009 wages in Poland will be growing at an average of 4.8% per year. It is however less than other countries in the region like the Czech Republic, Slovakia and Hungary which will record wage increase of over 6%. This data is according to the European Intelligence Unit, 2006. Quality of labour means the skills of people related to IT industry. In fact with the educational system existing in Poland, our engineers are high in world rankings concerning their preparation and abilities for IT, electronics and telecommunications. Poland offers considerable pool of scientists, engineers and technicians. The total number of scientists in Poland is higher than the amount offered by the Czech Republic, Hungary and Slovakia combined. In Poland there are 2 million students annually -- roughly the same as in Germany and Great Britain. Q: Please elaborate about investment opportunities in Poland. There are many aspects that make Poland an attractive place for investments for Korean companies. Located in the heart of continental Europe and being the biggest new member of European Union, Poland is a natural platform between West and East. Therefore investments in Poland give companies the opportunity of direct access both to the markets of the EU and the remaining markets of Central and Eastern Europe. Investing in Poland enables easy access to 500 million population in Western Europe and 250 million in Eastern Europe. As the member of the European Union, Poland has the same legal standards as the rest of EU countries and offers free flow of products with no customs or administrative barriers. Undertaking business activity in Poland gives also the opportunity of using Polish experience in commercial relations with the former Eastern block, as well as Russian Federation states. Undoubtedly the key assest of Polish society is its labour force. A population of almost 40 million people makes Poland a market larger than the combined markets of all the other nine accession countries that entered the EU together with Poland in May 2004. It indicates excellent sales opportunities but also availability of employees. Polish society is relatively young - 50% of the Polish society is under the age of 34 and 35% is under the age of 25.

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