Poland a crucial economic partner of Asia

In April 2016, the Polish-Asian Chamber of Commerce was established. Its president is Janusz Piechociński, who was deputy prime minister and minister of economy of Poland from 2012 to 2015. The following is an interview of Piechociński.

Adriel Kasonta: What was the purpose of establishing the Polish-Asian Chamber of Commerce, and what are its main goals and objectives?

Janusz Piechociński: The purpose of establishing the Chamber was to accelerate the process of internationalization of our economy and Polish entrepreneurship. The Polish-Asian Chamber of Commerce helps entrepreneurs in finding potential business partners, prepares market audits and research, provides legal advice, as well as facilitating B2B meetings, conferences, and business missions.

Today, Poland is the world’s 22nd-largest economy, eighth in the European Union, with a high share of modern industry in GDP, modern agriculture, and a large stake in the European processing industry.

Since 1991, Poland is the only European country with consistent GDP without decline, boasts the highest growth rate for several years and is a leader in the Central and Eastern Europe region (it accounts for over 40% of its potential yearly growth). Also, more than 80% of our trade is with EU countries.

We need a lot from the world and we can offer a lot to the world. After the 2007-2012 [global financial] crisis, when I was the minister of economy from 2012-2015, opening Poland to new emerging markets became our national program and a response to globalization. After a successful career in government, I decided to utilize this experience to set up the Chamber. We use the potential of the Asian diaspora in Poland to continue these activities.

That is why, in addition to Polish companies, the Chamber also has partners of Chinese, Korean, Indian, Japanese and Arabian backgrounds. The national sections of the Chamber are headed by their representatives.

We are effectively acquiring reliable partners for Polish enterprises and building good relations in trade and investment. We are also solidifying collaborative relations with Asian countries and economies in new markets.

The Chamber has also built the potential of a large expert base ready to prepare industry audits and market advice, consulting on areas of  legislation, tax, and investments. We organize conferences [and] business missions, and advocate for healthy competition at these events. You can learn more about our activities at www.polandasia.com.

AK: How would you assess the current economic exchange between Asia and Central Europe? What has changed since 1989, which marks the end of communism in this part of Europe?

JP: Economic exchange between Asia and Central Europe is developing drastically, not only as an investment area for business but for the fact that Central and Eastern Europe is becoming all the more attractive for tourism, health, higher education, and a rapidly developing center of commerce.

It was here that the largest automotive cluster was created, with Poland being roughly the fifth- or sixth-largest assembly plant for new cars in Europe, and a leader in the production of modern automotive components and parts. An interesting fact is that Poland is also the largest manufacturer of batteries for electric cars in Europe.

It is also worth mentioning that Poland is also the largest producer and exporter of electric buses. Because of Asian capital investment, we are the largest manufacturers of domestic televisions in Europe, and a powerhouse in the production of consumer home appliances.

Polish industry is very diverse and competitive in many industrial areas such as chemicals, pharmaceuticals, furniture, agriculture, and transportation, not just coal, copper and silver, where we have been European leaders for quite some time. In fact, Poland is a European BPO [business process outsourcing] center and has just under half a million high-caliber IT specialists.

The Polish success of the last 30 years did not come only from the fact that the first walls of communism fell thanks to “Solidarność.” In 1989 we were prepared for democracy and the free market because during the period of USSR domination, we kept private ownership of small industries, thanks to which our national entrepreneurial spirit survived and developed for generations.

AK: What are the main trading partners of Poland in Asia today?

JP: China, Japan, South Korea, cooperation with Vietnam, India, and Indonesia is developing faster and faster. There are more and more purchases in cooperative chains, more semi-finished products and parts, and final products such as clothing and raw materials.

AK: What are Poland’s strengths when it comes to trade with Asia?

JP: Poland’s strength is European quality at a lower price in contrast to German or Dutch products.

We are dominant in energy, agricultural, and processing technologies, and offer greater flexibility to partner requirements. It is also worth mentioning that our product development and innovation is second to none, increasing investment possibilities with Asian markets.

There are significant improvements in the institutional and legal environments, the mechanism of intergovernmental agreements and export insurance also being additional strengths.

AK: What has to be done to make Poland even more attractive to investors from Asia?

JP: Building on what we have done so far, but even more and even better. My first decision after joining the government in 2012 was to give a balanced overview to Polish and foreign investors. The decision was made to extend stable and attractive conditions for investing in Poland and the functioning of special economic zones until 2026.

AK: In your opinion, what are the key factors of a successful (and long-lasting) economic relations between Poland and Asia? Is it only about business, or perhaps cultural exchange also plays an important role?

JP: In my opinion, the two should never be separated. To be respected in business and relationships you have to show respect, to be understood you need to know the language of communication, but also have an appreciation and understanding of historical, cultural, and socioeconomic conditions.

It is crucial to get to know each other well, respecting customs and culture not just local business, and mutually understanding partners is an essential starting point for creating strong business relationships, negotiations and deals. It is not by chance that we start each business mission with training on cultural differences.

AK: We know that China is the world’s second-largest economy, with a realistic prospect of becoming the largest in the world. What are the implications of this global economic shift for Europe, and Poland in particular?

JP: China is already the leading economy in commodities. China has achieved spectacular success not only because of its share in global production, but in transport and services. In 10 years more than 300 million people in China have left the poverty zone, the emerging highly skilled middle class is increasing rapidly, which creates greater Chinese potential and a globalized generation that travel abroad with formidable purchasing power.

China’s investment potential is growing and the communication routes built with Chinese capital also create opportunities for others. In addition, leaps in tech innovation and the modernization of the Chinese economy make it more environmentally friendly.

This creates new opportunities for European countries and especially for Poland, which is the most important section of the China-Europe Economic Railway Corridor.

Poland is in NATO, is in EU, and our country is significantly expanding economic activity in every direction. We are looking for business partners everywhere and in my opinion we have an interesting and very attractive proposition.

AK: Can you tell us a bit more about the “Go China” project, initiated some time ago by you and Waldemar Pawlak?

JP: The “Go China” program is the Polish response to the Chinese “16+1” initiative announced in Warsaw by the Chinese premier after the joining of Greece (“17+1”). It is a comprehensive program of cooperation between China and countries of Central and Eastern Europe. “Go China” is a program of activating Polish diplomacy, administration, local government, and enterprises in relations with China.

Of course, the most important thing is the support for enterprises in entering Chinese market, attracting Chinese investments and improving cross communication.

AK: Should we embrace economic growth of China, or rather fear it?

JP: I have never given myself such an alternative. Today, after the global crisis of 2007-2012, our location is increasingly connected with what does not have to happen with us. A drone attack in Saudi Arabia, a climate catastrophe, a market collapse or the bankruptcy of a state industry or a large company poses a threat to others. We should wish each partner and ourselves development and prosperity.

A good economic situation in the US, China or Germany is a greater chance for our Polish economic situation as well. The answer to international competition cannot be trade and technological wars, extreme protectionism or economic nationalism. Because of that, our world is becoming less and less predictable and this translates into the uncertainty of the economy, enterprises and our jobs.

AK: What can China (or Asia in general) give Poland, and how can Poland contribute to the economic growth of Asia?

JP: First of all, we can derive knowledge, competence, technical and technological solutions from other experiences. Second, the world increasingly prompts us to live with each other, next to each other.

You can’t just think about established businesses and sectors. We also require progressive work and discussion on the future of Polish-Asian business potential and emerging markets. For some this is a threat and for others a golden opportunity. A threat to those who are not ready and not open to change, a chance for others who are flexible, open to new forms of cooperation.

 AK: Do you have any final thoughts, and could you tell us how businesses interested in the Polish-Asian Chamber of Commerce activities can contact you?

JP: I invite you to engage with the Polish-Asian Chamber of Commerce. I have already talked about what we can do in Poland for entrepreneurs interested in our country. From consultancy, audits, and market reports to help in choosing suitable business partners or places to invest, one of our main strengths is the promotion of companies and their products.

Recently, in cooperation with Chinese, Turkish and Vietnamese entrepreneurs in Poland, we have been implementing the Poland-Asia Center Project – transforming traditional well-located (10 kilometers from the Warsaw airport) shopping centers into an Asian City of Business with culture centers, international schools, hospitals, universities, hotels and offices for rent. However, it will be a place of full legal, tax, financial and investment services for Polish-Asian relations. There will also be logistic centers, warehouses, and e-commerce based on several hundred hectares in Warsaw and the immediate vicinity with great human capital.