Poland is on the border of Russia’s war in Ukraine, a nexus in NATO’s efforts to help counter Vladimir Putin’s offensive. As a cog in the European Union’s supply chain, the country has also found itself at the epicenter of wider East-West tensions fueled by friction between the United States and China.
Intel said it felt “safe” in Poland, in part because of the country’s “strategic” position on the eastern flank of the EU and NATO. Prime Minister Mateusz Morawiecki spoke at the Intel event in Wrocław on Friday that foreign investment “at the same time helps to strengthen security”.
Companies are scrambling to shorten supply lines and increase the number of sites to avoid being on the wrong side of a trade war. This outweighs fears that the war in Ukraine could escalate and destabilize neighboring countries like Poland.
Intel has joined Alphabet Inc., Google’s parent company, and Visa Inc. to expand its operations in the country.
Less than two weeks after the start of the war in February 2022, Alphabet announced around 700 million. Investment in USD in an office building in Warsaw. The new 2,500-employee center is the company’s largest cloud-based facility in Europe.
In May, Visa announced plans to create a global technology and product center with up to 1,500 employees.
“Poland is very important for the European Union because of its strategic location,” Intel CEO Keyvan Esfarjanis said in Wroclaw. “I’m not worried about things suddenly starting and stopping.”
Intel’s factory would become the last leg of the entire EU supply chain and allow the company to meet chip demand. Poland has also attracted a number of companies looking to take advantage of the approximately 300,000 graduates who graduate from universities every year and to create hubs and service centers, particularly in the technology and financial sectors.
In the service sector alone, foreign companies spent 38 million last year. 43,000 new jobs were created in the populated country, – 40%. more than in 2021, according to ABSL, a lobbying industry lobby group. Project44, a startup that helps customers oversee their supply chains, has opened an office in Krakow, about 270 kilometers from the border with Ukraine.
Scott Newman, director of State Street Bank International in Poland, said decisions to set up centers abroad were mainly based on cost until the effects of the pandemic gave rise to the concept of “concentration risk “: too many people in one place.
“There’s a lot of effort across the industry to move to a more comfortable ‘follow the sun’ model, which arguably offers more growth opportunities in Poland and the CEE countries,” he said. Berlin in March S. Newman at the organized business forum.
Over the past seven years, the number of employees in the Polish offshore services industry has doubled and today employs around 450,000 people. Currently, this industry generates about 5 percent of the country’s gross domestic product (GDP).
Economists attributed Poland’s improving trade balance to a surprise rise in the services sector, which helped push the zloty to a two-year high against the euro in June. 3.5 billion have been registered in the country in the last twelve months. monthly net dollar surplus from services transactions, a billion dollars more than a year ago, according to central bank data.
Poland offers salaries with higher purchasing power compared to Asian hubs, the same data protection regime as other EU countries and easy travel conditions, said Beata Javorcik, chief economist of the European Bank for Reconstruction and Development (EBRD). According to her, like the EU as a whole, this country is also an ally of the United States, if the world were to enter into a “win-win” scenario of two separate commercial spheres.
Relations between Warsaw and Washington, though strained by the war in Ukraine, have been strained in recent weeks after Poland passed a law allowing the ruling party to formally prosecute opposition leader Donald Tusk ahead of an election. tense in October.
The United States is currently studying the possibility of revising the law and aims to ensure fair political conditions and a peaceful transfer of power if the opposition wins, said Mark Brzezinski, the American ambassador to Poland. Meanwhile, the country remains at an important business and geopolitical crossroads.
“We treat it as an overlap of business and strategic context,” Brzezinski said on the sidelines of the Intel event in Wroclaw.
“It’s fantastic that despite Poland literally being on the edge of a war zone, it continues to attract significant investment,” he said.
Source: The Delfi