Cracow’s investment potential
In recent years, Cracow has been very popular in terms of investment. It ranked third in the Business Environment Assessment Study (BEAS) 2021. Various factors were taken into account during the evaluation, such as educational potential, employment potential, location or business potential.
What the Business Environment Assessment Study (BEAS 2021) presents?
The Business Environment Assessment Study (BEAS 2021) is a research cycle conducted by Antal – company specialising in HR consultancy and Cushman & Wakefield – real estate experts. In 2021, the third edition of the cycle took place. As part of this cycle, a report entitled Investment potential of Cracow was prepared and presented on Tuesday, October 19, 2021. Thanks to the conducted research we can find out what are the current trends in economic development on the Polish market.
In the face of the pandemic and the economic crisis, the subject of investment has become much more complicated. According to experts, currently the key to investments will be the optimization of costs while increasing the efficiency of operations, also in the case of remote working.
What are the factors that influence investing in Cracow
The report lists the following factors for investment incentives: infrastructure, educational potential, employment potential, business potential, public administration support, office space, evaluation of the location as a place to live. It mentions also cost of living and the level of wages.
Of the above-mentioned factors, the following can boast a high rating:
- educational potential (7.9)
- location rating as a place to live (7.1)
- business potential (7.0)
Investment potential in Poland
The main advantages of our country include such factors as geographical location or cost advantage in comparison to Western European countries. Thanks to the above elements, the modern business services sector is more and more active in Poland.
According to the report, Poland is still one of the best locations for the sector, attractive to investors from all over Europe and other regions of the world. In the case of the BSS sector there is rather no fierce competition between individual countries. It is more a competition between specific cities with the whole offer – infrastructure friendly for the development of investments.
Economic indicators and employment conditions in Poland
The following data related to investments conditions in Poland is included in the report:
- Registered unemployment rate in 2020 – 3,3%
- Minimum wage in 2020 – 568,27 €
- Estimated hourly labour costs labour costs in 2019 – 10,7 €
- The employer’s cost in addition to gross wages and salaries of the employee (% of wages) – 22%
- Average monthly wages and salaries in the enterprise sector excluding payments of profit rewards in 2020 – PLN 5 370,64
- Monthly minimum wage (statutory) in 2020 – PLN 2 800 gross
- The number of days of holiday leave accrued per calendar year if the employee has been employed for at least 10 years (years of service include periods of higher education) – 20 days
- The number of days of annual leave accrued per calendar year when the employee has been employed for at least 10 years – 26 days
- This is how many days in a calendar year an employer will pay for their employee’s sick leave (14 days for employees over 50 years of age) as part of the employee’s sick pay – 33 days
- Basic maternity leave – 20 weeks (fully paid by the Social Insurance Institution)
- Number of public holidays during the year (public/church holidays) – 13 days
Special Economic Zones (SEZ) in Poland
Special Economic Zones are administratively separated areas in Poland, in which investors may conduct business activity on preferential terms. Thanks to them, it is possible to develop both new technologies and human capital. The most important benefit for investors is CIT or PIT exemption on income achieved from activities carried out on the premises SEZ under the zone permit. In these regions the unemployment rate is relatively lower. In Poland there are currently 14 SEZ, including the Kraków Technology Park.
Kraków Technology Park
As part of the Polish Investment Zone, Krakowski Park Technological issued a record number of decisions on support, taking second place in 2019 among the companies managing the zones. All investment processes prove the complexity of the Krakow Technology Park’s offer. This place since 20 years has been co-creating conditions conducive to the development of entrepreneurship. The park offers a wide range of events, such as workshops and conferences for young start-ups. IT start-ups can benefit from the Technology Incubator.
Moreover, all enterprises can take advantage of seed funds and tax exemptions under the “Poland” program.
Investments in Poland in figures
- 209.5 billion € – The total value of direct foreign investment (FDI) in Poland at the end of 2019
- 4.9 billion € – Value of FDI in 2019 that went to business entities in the industrial processing sector
- 850 million € – The value of FDI in 2019 that went to businesses in the sector of professional, scientific and technical activities
- 1.4 billion € – The value of FDI in 2019 that went to businesses engaged in wholesale and retail trade, including the repair of motor vehicles and motorbikes
- 10 % Employment growth in service centres in Poland in the last year (2019 – Q1 2020)
- 1.5 thousand – Total number of service centres in Poland in Q1 2020
- 16.3 billion € – Value declared by investors of planned projects in Poland in 2019.
Investment plans
The report tells us in which cities there are most planned investments in new branches. These are inter alia Wroclaw, Warsaw and Cracow.
Summary
The research cycle (BEAS) 2021 demonstrates that Kraków is an investment-friendly city. The collected data is surprisingly positive. Even in the time of pandemic and economic crisis, investments in this city are growing.
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