ANALYSES AND REPORTS

Special Economic Zones after 2020

The Ernst & Young report: "Special Economic Zones after 2020 - analysis of the SEZ up to date activity and consequences of their future functioning" was presented on September 28^th, 2011 at the Ministry of Economy.

The Report, which was prepared by a team led by Paweł Tynel - Director of the Grants and Incentives Advisory Services at E&Y, presents the influence Polish SEZ have on economic condition of regions and puts forward solutions concerning the functioning of SEZs after 2020. Entrepreneurs’ opinions concerning the functioning of the zones were gathered in a survey conducted among 215 companies active in all 14 zones in Poland. The companies were active in all the major sectors of the economy.

Since the establishment of the first SEZ in Poland, i.e. 1995 the managements of the zones issued 1354 business activity permissions. The joint value of investments developed within the SEZs totalled PLN 73.2 billion and the number of new jobs created thanks to the projects reached 167,141.

The E&Y analysis proves that regions which host a special economic zone have on average a lower unemployment rate - from 1.5 to 2.9 percentage point and higher GDP 3.9% - 7.5%.

The survey shows that over 50% of the investors who have currently been running business in the zones do not consider establishing new projects if the zones are to exist only by 2020. At the same time the percentage of those who declare to start new projects should the zones exist after 2020, reaches 81%. As many as 96.7% of the surveyed named the CIT exemption as the major advantage which encouraged them to locate their business in a SEZ. Extension of the activity of the Special Economic Zones in Poland would also send a positive signal to investors who consider entering such a zone now. 9 years i.e. the time which is now left till 2020, do not guarantee that all the incentives offered by the SEZ will fully be used by new investors.

The European Commission should not hamper attempts to extend the time of SEZ functioning beyond 2020 if the idea behind zones complies with the common EU regional policy and the regulations in the zones do not violate regulations concerning common regional aid. More in the report which is available for download on our website (only in Polish):
www.paiz.gov.pl/publications/how_to_do_business_in_poland. (E&Y)