Poland aims to reverse brain drain

In recent years, the Polish government has promised huge public investment into local industries, with an emphasis on tech and innovation. Supported by EU funds, $250bn will be invested over the next 25 years, the government said in April. 

The Digital Poland 2014-2020 strategy is spending €10bn from the EU-financed Polish Development Fund. It has just created the Start in Poland programme, which will pump €630m into small and medium-sized enterprises (SMEs) and start-ups over the next two years through an investment platform called PFR Ventures, the largest ever in Central and Eastern Europe.

Attracting investment

In an interview with fDi, deputy minister of development Jadwiga Emilewicz said Start in Poland hoped to expand the VC market, which is “not very deep in Poland’s thriving tech and startup industry”. Apparently, 60% of Polish startups have not received external financing. Nonetheless, the country ranked 39th out of 128 nations in Cornell University’s Global Innovation Index 2016.

“The problem is that our domestic companies are not investing enough. They are investing in safe, secure investments like houses and so on, rather than new products or technologies,” said Ms Emilewicz.

Investing in innovation is critical for Poland to transition from “imitative suppliers” dependent on foreign markets, “[to] creators with a high level of income”. No wonder coding recently became obligatory in Polish primary schools.

By footing half the bill, Start in Poland encourages private investors – foreign or domestic – to finance the other 50%. The programme funds startups or SMEs at all stages from incubation to commercialisation, giving €50,000 to €15m for each project. It also offers investors “a special tax reduction”, said Ms Emilewicz.

Luring the diaspora

Despite Poland’s thriving tech scene, the World Bank’s 2015 report Toward an Innovative Poland, identifies the availability of skilled personnel as one “critical barrier” innovative local companies face. The problem is that many talented Poles emigrate. Start in Poland is a means of reversing this trend and attracting Europeans in general, especially from Eastern areas.

Ms Emilewicz said: “It’s easier to have venture capital money in Poland now, than in the UK. We don’t have as much competition and there’s a lot of public money available.” Attracting students and young people is a priority, she told fDi during the Polish Innovation Conference at Imperial College London.

However, can the government attract young foreigners while much of its own youth oppose the ruling Law and Justice (PiS) party’s controversial social policies, such as those on abortion? Ms Emilewicz said: “The project regarding abortion came from citizens, not the government. The discussion was good; it was democratic. Yes, Poland is split. But so is the UK, Europe or the US.”

Meanwhile, she called Brexit “an opportunity” for Poland, adding: “I don’t think Toyota development would have happened this year in Poland if not for Brexit. We feel the deeper interest. The human flow from the UK to Poland has increased. It’s also because of increased hate crimes and being offended on the streets, but also because of PiS’s family welfare programme, [the first of its kind] since 1989.”

Asked if PiS was promoting Polish startups abroad, Ms Emilewicz said: “We want to expand our companies. The first step is to attract them to develop in Poland. The Israeli example is impressive. They attract people and develop their projects in Israel. Then, if you want to [internationalise] or be bought by outsiders you have to pay back what was invested by Israel. I think that’s fair.”

Ms Emilewicz ended her conference speech by addressing Polish students: “Poland needs you more than ever. You are brilliant and should be proud to be Polish because we are proud of you.”