Investment Property in Poland

Economy

High unemployment

Poland has stuck to a policy of economic liberalisation throughout the 1990s and is probably the most successful of the so-called transition economies, yet it still has economic problems, not least of which is its unemployment rate (18.2% in 2005), which was the highest in the EU until the 2007 accessions of Bulgaria and Romania.

Healthy GDP growth

Poland’s economy is growing at a healthy rate however – in 2005 its GDP was up by 3.4%, and the country is experiencing high levels of foreign direct investment. However, there are worries that its competitiveness could be threatened by the zloty's appreciation. The GDP per capita in Poland was $13,100 in 2005. Broken down into sectors, the country’s GDP is composed of 5% agriculture, 31.1% industry and manufacturing, and 64% service industries.

EU funding

Having joined the EU in May 2004, surging exports to the EU contributed to Poland’s strong growth that year, and it benefited from nearly $23.2 billion in EU funds in 2006.

New middle class

Western companies are investing heavily in Poland, opening offices and factories there, and the influx of overseas workers combined with the rising financial status of Poles, including the creation of a Polish middle class employed by the new economy, are major factors in driving a vibrant economy and property market.

Foreign direct investment

Martin Oxley, Chief Executive Officer of the British-Polish Chamber of Commerce (BPCC), said of the levels of FDI in Poland: “UK investors in Poland have proven the country’s attractiveness by establishing market leadership in several sectors, including retail (Tesco) and pharmaceutical (GlaxoSmithKline)…These British success stories prove that the opportunities for building strong, sustainable businesses are plentiful.”

Growing industrial output

The country’s 17.1 million-strong workforce is divided into the following occupations: agriculture – 16.1%, industry and manufacturing - 29%, and services - 54.9%. In contrast to many EU countries, Poland’s industrial output is growing – it increased 3.7% in 2005.

Agricultural sector

According to the CIA World Factbook, Poland's agricultural sector remains handicapped by surplus labour, inefficient small farms, and a lack of investment. But farmers have already begun to reap the rewards of EU membership via booming exports, higher food prices, and agricultural subsidies.

Birth of privatisation

The gradual dismantling of the communist system has resulted in the privatization of small- and medium-sized state-owned companies and a liberal law on starting new firms has led to rapid growth of the private sector.