{"id":19445,"date":"2024-10-31T06:30:00","date_gmt":"2024-10-31T06:30:00","guid":{"rendered":"https:\/\/reinvantage-dev.eonserver.com\/?p=19445"},"modified":"2024-10-31T06:30:00","modified_gmt":"2024-10-31T06:30:00","slug":"poland-and-cee-can-win-nearshoring-investment","status":"publish","type":"post","link":"https:\/\/reinvantage-dev.eonserver.com\/?p=19445","title":{"rendered":"Making the most of CEE&#8217;s nearshoring potential"},"content":{"rendered":"\n<p><strong>Poland\u2019s highly skilled workforce and developed IT services market make it an attractive destination for foreign investors who want to shorten their supply chains<\/strong>. <strong>Other parts of emerging Europe are well-placed too\u2014if they can move up the value chain.<\/strong><\/p>\n\n\n\n<p>Nearshoring, or relocation of manufacturing, logistics, warehousing and office centres to countries closer to their target markets, began with the Covid-19 pandemic and the resulting disruption of supply chains.<\/p>\n\n\n\n<p>The trend has been further fuelled by geopolitical instability arising from wars in Ukraine and the Middle East, as well as the trade war between the US and China. The strengths of Poland and the CEE region include access to the large European Union market and the security guarantees that come from NATO membership.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-text-color has-background has-cyan-bluish-gray-background-color has-cyan-bluish-gray-color is-style-wide\"\/>\n\n\n\n<ul class=\"wp-block-list\"><li><a href=\"https:\/\/emerging-europe.com\/analysis\/the-future-of-manufacturing-in-cee-transitioning-to-a-high-tech-added-value-era\/\">The future of manufacturing in CEE: Transitioning to a high-tech, added value era<\/a><\/li><li><a href=\"https:\/\/emerging-europe.com\/analysis\/cee-can-put-itself-at-the-heart-of-the-global-supply-chain\/\">CEE can put itself at the heart of the global supply chain<\/a><\/li><li><a href=\"https:\/\/emerging-europe.com\/analysis\/as-esg-moves-front-and-centre-what-does-it-mean-for-cees-supply-chains\/\">As ESG moves front and centre, what does it mean for CEE\u2019s supply chains?<\/a><\/li><\/ul>\n\n\n\n<hr class=\"wp-block-separator has-text-color has-background has-cyan-bluish-gray-background-color has-cyan-bluish-gray-color is-style-wide\"\/>\n\n\n\n<p>These advantages mean Poland remains an attractive destination despite rising labour costs. Some analysts, however, are now urging the country\u2019s government to promote investment more actively.<\/p>\n\n\n\n<p>In Emerging Europe&#8217;s latest <a href=\"https:\/\/d11n7da8rpqbjy.cloudfront.net\/emergingeurope\/30984969_1725624750254Investment_Promotion_Report_2024_6_09_Final.pdf\">Investment Promotion Report<\/a>, which looks at the effectiveness of the region&#8217;s 23 investment promotion agencies, Poland ranked just ninth\u2014a sign that despite its undoubted success in attracting foreign investment, it can do more.<\/p>\n\n\n\n<p>\u201cCompeting for investments using the low costs argument is no longer an effective strategy for Poland and Czechia, and may only be a short-term solution for Hungary and Romania,\u201d says Jacek Gizi\u0144ski, co-managing partner at law firm DLA Piper Poland.<\/p>\n\n\n\n<p>It&#8217;s a point that Emerging Europe has been making <a href=\"https:\/\/emerging-europe.com\/analysis\/the-future-of-manufacturing-in-cee-transitioning-to-a-high-tech-added-value-era\/\">for some time<\/a>.<\/p>\n\n\n\n<p>\u201cThe key to success today is to invest in the future through education, technology and promoting the region as an attractive place to invest.\u201d<\/p>\n\n\n\n<p>Data from the National Bank of Poland for 2022 show European countries account for the largest share of foreign direct investment in Poland (96 per cent).<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">IT and real estate<\/h5>\n\n\n\n<p>IT and real estate investments in recent years are of great importance for companies interested in relocating, and the government should stress them in its promotional activities, DLA Piper\u2019s analysts say.<\/p>\n\n\n\n<p>\u201cIncreased investment in IT infrastructure and a growing number of data centres can make Poland a key player in technology and cybersecurity,\u201d says Ewa Kurowska-Tober, partner and head of IPT at DLA Piper in Warsaw.<\/p>\n\n\n\n<p>\u201cThe importance of IT security will continue to grow, favouring countries with a high data protection culture and advanced technological solutions. Poland offers mature forms of intellectual and industrial property rights protection that are important for investors in building competitive advantages.\u201d<\/p>\n\n\n\n<p>Poland also stands out against the rest of the region with its competitive commercial property stock, offering the fourth-largest amount of warehouse space in the EU, but with rental and operating costs half those of Spain and two-thirds of Germany\u2019s.<\/p>\n\n\n\n<p>This creates a solid foundation for strengthening Poland\u2019s position as an international logistics and production centre. Both the greenfield investment sector and brownfield projects, involving the renewal of existing assets, have the potential to accelerate. Furthermore, newly developed office and warehouse properties meet high environmental criteria, which is of increasing importance to investors.<\/p>\n\n\n\n<p>\u201cESG requirements for companies and commercial real estate continue to expand and influence the decisions of investors looking to relocate their logistics and office centres,\u201d says Micha\u0142 Pietuszko, partner and head of the real estate practice at DLA Piper in Warsaw.<\/p>\n\n\n\n<p>\u201cPoland is now favoured not only by its geographical location and the large availability of land, but also by the quality of its real estate stock.\u201d<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Western Balkans potential<\/h5>\n\n\n\n<p>Other parts of emerging Europe are also well-placed ro make the most of the nearshoring trend.<\/p>\n\n\n\n<p>A recent&nbsp;<a rel=\"noreferrer noopener\" href=\"https:\/\/wiiw.ac.at\/transforming-the-western-balkans-through-near-shoring-and-decarbonisation-dlp-6999.pdf\" target=\"_blank\">study<\/a>&nbsp;from the Vienna Institute for International Economic Studies (wiiw), in collaboration with the chambers of commerce of the six Western Balkan states\u2014Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia\u2014analysed the state of near-shoring in the Western Balkans, and found that nearshoring is already taking place, particularly in Bosnia and Herzegovina, Kosovo and North Macedonia, where foreign direct investment (FDI) inflows between 2020 and 2023 were significantly higher than the long-term equilibrium values calculated.<\/p>\n\n\n\n<p>Foreign industrial companies are increasingly focusing on the region, with a notable number coming from China, Japan and South Korea.<\/p>\n\n\n\n<p>\u201cAsian firms take a highly strategic approach, deliberately positioning their production facilities near the EU\u2019s economic core in order to have shorter supply chains,\u201d says Branimir Jovanovi\u0107, economist at wiiw and lead author of the study.<\/p>\n\n\n\n<p>As part of the study, 17 foreign investors in the Western Balkans were interviewed about their motivations. They confirmed the significance of locating production facilities close to the EU so as to mitigate supply chain disruptions and geopolitical risks. They also highlighted the importance of environmental protection and CO2 reduction.<\/p>\n\n\n\n<p>\u201cIf local suppliers make progress in decarbonising their operations, we see significant opportunities for them to integrate into international supply chains and expand,\u201d Jovanovi\u0107 adds.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-text-color has-background has-cyan-bluish-gray-background-color has-cyan-bluish-gray-color is-style-wide\"\/>\n\n\n\n<p class=\"has-text-align-center\"><em>At Emerging Europe, we use an integrated approach centred around market intelligence to help organisations understand trends and strategically position themselves for success. &nbsp;<\/em><\/p>\n\n\n\n<p class=\"has-text-align-center\"><em>Learn how our solutions can help you thrive in the region:<\/em><\/p>\n\n\n\n<p class=\"has-text-align-center\"><em> <a rel=\"noreferrer noopener\" href=\"https:\/\/emerging-europe.com\/our-story\/\" target=\"_blank\">Company and Services Overview<\/a> | <a rel=\"noreferrer noopener\" href=\"https:\/\/emerging-europe.com\/strategic-advantage\/\" target=\"_blank\">Strategic Advantage<\/a>.&nbsp;<\/em><\/p>\n\n\n\n<hr class=\"wp-block-separator has-text-color has-background has-cyan-bluish-gray-background-color has-cyan-bluish-gray-color is-style-wide\"\/>\n","protected":false},"excerpt":{"rendered":"<p>Poland\u2019s highly skilled workforce and developed IT services market make it an attractive destination for foreign investors who want to shorten their supply chains. Other parts<span class=\"excerpt-hellip\"> [\u2026]<\/span><\/p>\n","protected":false},"author":1,"featured_media":19446,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[15,21,6320,356,7914,7998,9,237,7140],"class_list":["post-19445","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-czechia","tag-economy-politics","tag-featured","tag-hungary","tag-nearshoring","tag-nearshoring-in-poland","tag-poland","tag-romania","tag-supply-chains"],"_links":{"self":[{"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=\/wp\/v2\/posts\/19445","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=19445"}],"version-history":[{"count":0,"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=\/wp\/v2\/posts\/19445\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=\/wp\/v2\/media\/19446"}],"wp:attachment":[{"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=19445"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=19445"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/reinvantage-dev.eonserver.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=19445"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}