What are the main recommendations for the new government and what does the Polish economy need most? This is what participants in EEC Trends 2024 discussed

One day, 11 debates with the participation of almost a hundred speakers, 100 accredited journalists and more than 1100 participants, discussions, conclusions and opinions on the most important phenomena and current problems of the economy and, above all, its development prospects. That, in a nutshell, is the recent EEC Trends. The speakers addressed topics that will be discussed further at the 16th EEC (European Economic Congress, 7-9 May 2024).

EEC Trends is a series of discussions on the future of the Polish economy, led by experts from various fields. The multidisciplinary group assessed the prospects and current directions of the Polish economy, and the debates will continue during the 16th European Economic Congress, which will be held in May at the International Congress Centre in Katowice.

The inaugural session of EEC Trends entitled “The economy anew. Recommendations for those in power” covered seven areas important for the economy and related to its immediate environment. Important recommendations were made to the government.

“EEC Trends is an important part of the campaign in preparation for the European Economic Congress in Katowice”, stressed Wojciech Kuśpik, President of the PTWP Group, during the inauguration. “Our overarching goal is to create a platform for dialogue about the economy. The agenda for the EEC is being developed in this dialogue. It is in the discussions today that we want to bring the thematic coverage of the Congress to a final shape”, he noted.

“We meet in special circumstances, too. Since 15 October we have a new government and new people heading institutions important for the Polish economy. This dialogue is therefore of particular importance at the moment”, said the PTWP president.

Poland’s key problem

As Brunon Bartkiewicz, CEO of ING Bank Śląski, pointed out, a far too low investment rate is a key problem that already means we are lagging behind in our development. Therefore, the new government – in his opinion – should adopt solutions to support investment in Poland.

“We have a too-low rate of investment and this has been the case for 10 years now. A decade of under-investment: we are lagging not only in the development of our manufacturing capacity, but also in the necessary transformation, and I am not just thinking about energy, but also about automation or robotics. Each of us can try to estimate what impact this delay has on our wellbeing in 10-20 years’ time. We now need an improvement in the investment rate, which is currently at a level of 16. The EU average is 22, so Poland is much lower in this respect”, noted the CEO of ING.

“Solutions like improving the tax system or unblocking the National Reconstruction Plan are important, but there are deeper problems. The investment culture itself is a problem, which is probably mainly due to legislative instability and disbelief that the Polish entrepreneur can really grow strongly and quickly”, he said. “We have a relatively low impact of investment on the GDP and this is the fundamental problem we should be talking about. The fact that the government wants to consult on tax laws or to build roads is nice of course, but it is not enough. We also need great and intelligent support for Polish investments, so that this multiplier effect, that companies develop quickly, spills over to the whole economy”, said Bartkiewicz.

A wise state creates conditions for growth and competitiveness rather than competing with private business

The state in the economy should set clear rules, provide security and ensure that companies have equal access to infrastructure or take on tasks that private business cannot handle, but which are important for achieving competitive advantages for the economy as a whole.

“The state does not need to fulfil ownership functions”, noted Sebastian Jabłoński, CEO of Respect Energy. “This is unnecessary stress for politicians”, he added.

According to Jabłoński, politicians are hampered in managing companies by their tenure, while private owners think about the company in the long term.

“Lawmaking should be separated from the management of economic operators. The state cannot be the owner and regulator at the same time, because this corrupts the market”, noted economist Małgorzata Starczewska-Krzysztoszek, lecturer at the Department of Political Economy of the Faculty of Economic Sciences at the University of Warsaw.

The change in the energy mix generated in Poland must accelerate

The challenges of containing the climate crisis and a sustainable economy were high on the agendas of responsible, forward-thinking companies.

“Transformation affects the entire economy, not just the energy sector”, noted Reinier Schlatmann, CEO of the Central and Eastern European region at DS. Smith.

“Reducing the use of raw materials and other resources is a key task and area of our activity. When creating regulations that affect the economy – and there is a lot going on at EU level right now in the area of packaging – we need to see the complex context and implications. Recycling is extremely important as we move towards a closed loop economy”, he concluded.

Poland lacks sources of green energy for companies to reduce their carbon footprint. The condition of the electricity grid is the main inhibitor of the green transition in Poland.

“We need a special determination in this area”, recommended Anna Rulkiewicz, CEO of the LUX MED Group.

“The supply of green energy is too small in relation to needs. We know this well because we have made commitments to climate neutrality”, she said.

The opening session also addressed the investments that are and will be made in Poland. There were talks, for example, of building an Intel plant in Miękina near Wrocław or the construction of nuclear power plants.

“The state should invest and support investment in the Polish market, but it should set requirements. The transfer of knowledge from abroad should stay here”, said Artur Popko, CEO of Budimex.

The CEO of the construction company cited the construction of a nuclear power plant as an example of such a situation. “What surprises me is that if we build a nuclear power plant, this technology does not stay in Poland and Polish engineers cannot pass it on later and redirect what the Koreans are doing at the moment”, he pointed out.

“We will never learn it because they will never let us do it”, Popko said.

Projections: Improving the relationship between business and government

With greater optimism and hope – this is how business representatives look at the coming months. As they emphasise, the atmosphere for doing business in Poland is changing, but there is still much to be done.

“There is more optimism that the authorities, the government, local governments will start treating business like a friend again, not an enemy. There is also hope that the number of open battle fronts – both in Poland and with our neighbours – will decrease”, said Wojciech Kostrzewa, President of the Polish Business Roundtable, during the session “Law, business, economy”.

Adam Krzysztof Abramowicz, spokesperson for Small- and Medium-sized Enterprises, emphasised that entrepreneurs took all electoral promises very seriously.

“Obviously, change takes time and cannot be implemented immediately, but we must be aware that patience will also run out at some point. Hence my appeal to speed up work on changes that will not hinder business”, said Abramowicz.

Attempt at repair

Piotr Kamiński, vice president of finance at the Employers of Poland, also views the change in attitude positively.

“In my idea of a good state, the state is the guardian of security, it defines the framework created in a transparent way, in dialogue with representatives of the social side”, he stressed. “Where the state should intervene, we should have efficient and transparent supervision. It cannot be an oversight created because ‘it seems so to someone’. We should look at the state as a good company in which certain processes take place. The law should describe those processes”, he added.

No more “golden handles”

“I don't want to see solutions that I can confidently describe as a nonsense. It is a good time to put an end to poor design on the railways”, said Deputy Infrastructure Minister Piotr Malepszak.

The Deputy Minister outlined the priorities for his work at the Ministry. The most important ones are to improve the efficiency of the railway network and to ensure that railway investment money is spent sensibly. He added that his aim was not to stop railway investment but to review it. It doesn't even take three months, and sometimes the mistakes are simple, easy to spot.

The Deputy Minister is concerned with tidying up regulations and working on smaller projects that will increase railway capacity. They can be expected by the market. When it comes to major projects, they are to be tailored to the needs found in the area, avoiding any one-size-fits-all approaches.

“I'm not reinventing the wheel; I'm not stating the obvious. I try to approach railway infrastructure in the way it is approached in the West. I will direct my action towards spending public money in a cost-effective manner”, said the Deputy Minister.

“Ensuring the stability of funding for infrastructure investments is a matter that is taken very seriously by Infrastructure Minister Dariusz Klimczak”, he added.

Investing in energy transition

Michał Wypychewicz, CEO of ZPUE, took part in the debate “Energy, transformation, security”.

“We simply cannot afford not to invest in the energy transition today. It’s not a question of whether to invest, it’s a question of how to do it, because business has known for a long time that a competitive economy without an energy transition, without basing it on RES and without major investment in this area, is simply impossible”, commented Michał Wypychewicz.

He stressed that if one talks about security, one must start with the risk generating factors, and these can be divided into several groups, including those related to global trends.

“Global trends are such that superpowers are being formed. Those superpowers will clash. China and the US will be those superpowers on the international scene. If we want to have any weight in this game, we have to cooperate in Europe”, stressed Wypychewicz.

The government’s position on the problem, was presented by Maciej Bando, Undersecretary of State at the Ministry for Climate and Environment, Government Plenipotentiary for Strategic Energy Infrastructure.

 “A new energy strategy for Poland should be developed as soon as possible”. This strategy, which in principle has not been subject to any significant changes for years, has obviously – by now – become a bit of a thing of the past. Definitely more emphasis needs to be placed on the cyber security aspect. It has not been recognised enough so far in my opinion. The change in energy policy announced by Minister Hennig-Kloska must, of course, go hand in hand with a national energy and climate plan and development of a review of the so-called Polish nuclear programme”, said Maciej Bando.

Polish business needs a strategy towards Ukraine

“It is our duty to help Kyiv. We played those first days and months since Russia’s invasion of Ukraine very badly. In Poland, a crisis staff consisting of Poland's central authorities was not established. The Polish government used the war to promote itself”, noted Zbigniew Jagiełło, a member of the supervisory boards of Blik, Asseco, EkoEnergetyka and MCI.

“No one who is not from a non-military sector will go to invest in Ukraine now, given the threat of war in Ukraine. However, it is worth preparing for the future reconstruction of this country. Polish business should consider different scenarios regarding Ukraine, and for the time being it is not prepared for this”, added Dariusz Blocher, CEO of Unibep.

“Polish investors are ready to implement projects even before the end of hostilities. This may be due to the fear that after the end of the war, American and German capital will dominate in terms of investment”, commented Volodymyr Lytvyn, President of the Polish-Ukrainian Chamber of Commerce in Kyiv.

AI, or what dreams are made of

EEC Talks, i.e. short talks with experts in a given field, were a refreshed formula in the EEC Trends programme and will be an important element of the May Congress. Aleksandra Przegalińska-Skierkowska, Vice-Rector for International Cooperation and ESR of Kozmiński University, took part in one of the discussions. When asked about artificial intelligence in a legal context, she highlighted the difference in the European approach versus the US or Canadian regulations.

“The rapid diffusion and proliferation of AI is evident in both business and private use. The EU regulations were three years in the making, and last year and the sudden surge in popularity of AI necessitated their revision. The people who create AI technologies and then research and deploy them need clear and transparent regulations on what is allowed and what is not. Certain AI algorithms in some applications do not raise any questions, do not require any additional justification as to why we are using them, but there are some applications that are extremely sensitive and there you will already have to go to great lengths to demonstrate that the technology, especially if it is comprehensive, is indeed safe. In a typically European approach, certain uses of AI should be banned, unlike in US or Canadian regulations”, said Aleksandra Przegalińska-Skierkowska.

The Vice-Rector also added that the EU regulations had been met with dissatisfaction not only from technology companies but also from other users.

“The ‘bitter compromise’, as the EU regulations have been called, is a bit of it for everyone. The public side feels this way because they would like even more supervision, transparency, guarantees of the security of our data, and on the other hand, technology companies want to produce this technology further, they felt very strongly that it can be added to already existing systems”, said Przegalińska-Skierkowska.

“If companies think AI is a toy, they will certainly soon be able to feel, especially among competitors, that this is not the case and AI is a strategic technology”, she added.

During EEC Trends, those who are spectacularly successful in business or are changing the Polish economy for the better through their actions were honoured. The WNP Award titles went to: Arche, BLIK, Cognor, Danfos Poland, Elemental Holding, EMPiK, Grupa Kruk, Professor Aleksandra Przegalińka- Skierkowska, TDJ and VIVE Textil Recycling.

The EEC Trends was held on 8 February 2024, at the Sheraton Grand Warsaw Hotel and online.

The event is a prelude to Central Europe’s largest business meeting, the European Economic Congress, which will take place on 7-9 May 2024 at the International Congress Centre in Katowice.