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Summary of the Report                                                                                         

Introduction

The Gdansk Institute for Market Economics (GIME) undertakes a fourth study on the territorial diversification of  foreign investment  attractiveness of Poland. The three earlier studies resulted in the publication of three respective reports on the Investment Attractiveness of Voivodships and Sub-Regions of Poland.

In this 4^th edition of the report we seek to continue our effort as well as to  improve our research methodology.  As before our overriding objective is  to portray, with a maximum of precision,  a time-graded territorial diversification of  investment attractiveness (IA) in Poland. To this end we need to modify some of our research methods, and in particular the choice of  indices and weights, due to the evolution of investor preferences and socio-economic changes in the voivodships. In order to maintain the comparability of results in the successive reports  we assumed to restrict the modification of research methods to the degree that would make it possible to analyse changes in the synthetic  IA indices  between the years.

As in the earlier  reports of 2005-2007,  we performed a synthetic assessment of  IA of voivodships and an assessment of  IA of sub-regions against three criteria:

-         industrial activities

-         services

-         advanced technology activities.

Based on the aforementioned assumptions and our research methodology it is possible to trace changes  in the territorial diversification of  foreign investment attractiveness of the  Polish voivodships. These are further reflected  in the IA rating lists compiled for the years 2005-2008. Regrettably, it is not possible to obtain a direct comparability of  current results  with those of previous reports due to a significant change in the number of  sub-regions and  their territorial delimitation which took place in the early 2008.  On the other hand the picture of investment attractiveness obtained for the new layout of sub-regions seems to better reflect the real functional and territorial structure of Poland.

 This research has been carried out by a team of GIME contributors upon the commission by the Ministry of Regional Development. The conference and the publication of this report, as well as of its summary, were made possible  thanks to the co-operation between GIME and The Konrad Adenauer Foundation . The authors wish to express their heartfelt gratitude to the following persons and institutions for their co-operation and financial support in this project:

-         Management of the Ministry of Regional Development and of the Department for Structural Policy Co-ordination;

-         Director Stephan Raabe and Mr Falk Altenberger of The Konrad Adenauer Foundation.

The aim of the report and the scope of research

This report aims to

-         identify territorial differences in the level of investment attractiveness and to grade voivodships and sub-regions in this respect;

-         indicate strong and weak points of individual territorial units in terms of  IA factors;

-         analyse changes in the investment attractiveness of  voivodships.

The substantive scope of the report follows from the notion of  investment attractiveness. IA is understood as a capability to attract investment through a combination of business benefits linked to location. These benefits stem from the specific features of the area, in which business activity is developed, and are referred to as locational factors. Therefore a set of locational factors determines the investment attractiveness of a given area. Those areas that offer an optimum combination of locational factors attract investment. They make it possible to reduce investment expenditures and the current costs of business while enabling the maximisation of profits and reducing the risk of business failure.

Business activities come in all forms and shapes which leads to diverse locational preferences. Consequently, there is no investment attraction of an area in the absolute sense. Our assessment of  investment attractiveness is, therefore,  a two-track process:

-         with respect to sub-regions we discuss locational factors for the three most important types of economic activity –the industry, services and advanced technologies;

-         with respect to voivodships universal locational factors are discussed.             

In this context we analysed several dozen variables which form the basis for the assessment of territorial diversification of specific location benefits (factors), including availability of transport, cost of labour, quantity and quality of labour resources, absorption capacity of the output market, the level of economic and social infrastructure, the level of economic development and of general safety. Various weights were attributed to these factors depending on the type of  business activity.                             

Table 1. Factors and their significance for investment attractiveness of sub-regions and voivodships.

Source: GIME research

The territorial scope of the report covers the entire area of Poland and subdivides into

-         16 voivodships;

-         54 sub-regions (formally , there are 66 sub-regions but, for the sake of the report, large cities that constitute sub-regions, including Katowice, Cracow, Łódź, Poznań, Szczecin, Tri-City (Gdańsk, Gdynia, Sopot) and Wrocław were grouped  together with their respective surrounding areas with which they are functionally linked).

The report relied on the data obtained mainly from the public statistical sources, and was complemented by other data. The key sources of information were:

-         Regional Data Bank of the Main Statistical Office;

-         State Agency for Information and Foreign Investment;

-         Managers of special economic zones;

-         Departments of Trade and Investment Promotion at the Polish Embassies in the countries with the highest share of foreign investment in Poland;

-         Winners of the Gmina Fair Play 2008 competition which was organized by the  Institute for Private Enterprise and Democracy.

The set of indices was modified in line with the changes in investor preferences and  socio-economic transformations.

-         Availability of transport was defined in terms of time needed to cover a distance between given areas. This approach enabled us to better reflect qualitative changes in infrastructure (e.g. the expansion of  motorways, modernization of existing roads).

-         Indices reflecting access to major sea-ports were factored in. This factor seems to be gaining importance,  especially relative to the location of production.

-         The level of development of the transport and logistics sector was factored in . The location of a logistics centre attracts other investments that benefit from the facilitation of transport.

-         The assessment of  voivodships’ investor-oriented activities was extended to cover the index of participation of the winning communities in the Gmina Fair Play competition. As a result the assessment gained  in precision.

See the full summary of the report which can be downloaded from this page.