Polish foreign investments: new trends and directions
The top five countries in the ranking of the most promising directions for Polish foreign investments are: India, Finland, Estonia, Israel and Chile - according to the report "Polish foreign investments: new trends and directions" prepared by PwC Poland and PFR TFI. KUKE is a partner of the study.
Ranking of the most promising directions for Polish foreign investments
Although currently most Polish direct investments are located in Europe (over 84% in terms of cumulative value in 2020), and companies most often indicate nearby European destinations as potential new investment locations, there are many other, less obvious directions with a significant unexplored potential.
The report "Polish foreign investments: new trends and directions" presents the most interesting of them, taking into account the impact of the Covid-19 pandemic on the attractiveness of individual countries. The ranking favors countries that have coped relatively best with the effects of the pandemic in terms of the inflow of foreign direct investment. It was also decided to try to map the impact of current geopolitical events on short-term investor sentiment.
In the basic ranking of the most promising destinations for Polish foreign investments, the highest places were taken by: India, Finland, Estonia, Israel and Chile. These are rapidly growing markets, taking many initiatives to increase their business attractiveness to foreign investors.
“When choosing the direction and specific goal of a foreign investment, it should be remembered that they must fit into the company's long-term development strategy. These cannot be decisions detached from the company’s business model”.
Cooperation and support in the implementation of foreign investments
In addition to the ranking, the report also presents the results of research carried out on a sample of 240 medium and large Polish enterprises. They clearly show how important the first experiences on foreign markets are for the next steps in the international development of companies.
“Companies that have already learned about the specifics of doing business abroad can see the benefits and profits it can bring. Among the surveyed companies investing abroad, almost 60 percent announced willingness for further expansion”.
The situation is the opposite in the group of enterprises that do not invest abroad - the vast majority of 80 percent has no specific plans in this regard. This shows that it is worth encouraging companies to expand abroad and showing them the benefits associated with it. Solutions offered by institutions such as the Foreign Expansion Fund managed by PFR TFI or KUKE, may be helpful here. Working with them can facilitate and accelerate international business development.
Global trends on the foreign direct investment market
The authors of the report present the key trends on the foreign direct investment (FDI) market and point to their importance for Polish companies. These trends could have been observed before, but the Covid-19 pandemic turned out to be their accelerator. The most important phenomena include: securing supply chains, screening foreign direct investment and increasing protectionism, the e-commerce revolution, reducing the carbon footprint and implementing ESG practices, as well as new technologies and the use of artificial intelligence.
“The Covid-19 pandemic, the e-commerce revolution, the need to secure supply chains are factors that make the approach to FDI change dynamically. One of the responses to these phenomena is the regionalization of investments and the formation of state blocs. You can also see that more and more countries are introducing procedures that hamper foreign investment”.
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