Poland - Convergence to Europe : The Challenge of Productivity Growth - Investment Climate Assessment

Abstract

Improving the investment climate is a
 key pillar of the World Bank's private sector
 development strategy. Without a good investment climate,
 firms and entrepreneurs of all types-from farmers to
 micro-enterprises to local manufacturing concerns and
 multinationals-have few opportunities and incentives to
 invest productively, create jobs, and expand, enter and
 remain in the formal economy, and thereby contribute to
 growth and poverty reduction. Growth and private sector
 development encompass a very broad agenda, but in
 Poland's case such a challenge boils down to the
 objective of reducing the convergence time to the standard
 of living of the European Union (EU)-15 countries. Sound
 macroeconomic policy, debt sustainability, open trade,
 security, access to finance, good governance and quality
 infrastructure services are all key requirements for the
 private sector to flourish. These conditions need to be
 complemented by micro-economic reforms-the policies and
 institutions that support efficient private economic
 activity-that help to unleash competitive forces leading to
 increased productivity and competitiveness. The Poland
 Investment Climate Assessment (ICA) is the first ICA piloted
 in the World Bank's Europe and Central region in 2004,
 adding to the stock of knowledge from the many other country
 reports prepared worldwide. The Poland ICA provides
 benchmark data to assess firm-level performance in other
 countries in the Europe and Central Asia region. The report
 also analyses Poland's strengths and weaknesses in the
 context of a regional comparison, with the EU-8 countries,
 which recently joined the European Union, the cohesion
 countries, and the other EU member countries.