2023 POLICY ROADMAP

According to European Union forecasts, Poland’s overall GDP growth in 2023 will amount to 0.4%. It is expected to rise to 2.7% in 2024, led by strong retail sales and improvements in the construction sector. An inflation rate of around 11% in 2023 is predicted to fall to 6% in 2024.1 This has led to some business optimism, driven by declining supply prices and costs; however, those two factors remain key barriers to business development.

Tax reforms in 2022/2023 have reduced personal income tax rates, while VAT rates were reduced in 2022 on food, fuels and some agricultural products, in order to combat inflation.

2023 Framework Conditions Review2

The GEM Policy Roadmap for Poland in 2022 pointed to declining expert-assessed Entrepreneurial Framework Condition (EFC) scores across the board, and concluded that “these results constitute a red flag for the Polish government and require appropriate strategies, radical actions and significant investment”. Things have improved considerably in the intervening period, with 12 of the 13 EFC scores increasing in 2023 and just one staying the same.

Improvements have been high in those EFCs most closely associated with government, including Government Entrepreneurial Programs (up from 3.4 to 4.4), and both government policy EFCs (Support
and Relevance, up from 2.7 to 3.4, and Taxes and Bureaucracy, up from 3.5 to 4.0). Scores for Commercial and Professional Infrastructure and for Research and Development Transfers have also risen sharply. Many Polish EFCs are still less than sufficient; the country lags behind the Level B average on many counts. Improvements will hopefully reverse a downward drift in the quality of the overall entrepreneurial environment.

One result of these improvements is that the expert- assessed quality of that entrepreneurial environment, as summed up by the National Entrepreneurial Context Index (NECI), improved in 2023 (4.3 in 2023 from 3.8 in 2022). There remains much to be done, especially in relation to entrepreneurial education.

The social support for women entrepreneurs and their access to resources compared to men were given rather low scores by Polish national experts, at 3.1 and 4.2 respectively. So, once more, there is still much to do.

2023 Entrepreneurial Activity Review

Since the pandemic, Poland’s Total early-stage Entrepreneurial Activity (TEA) levels have been among the lowest in GEM participating economies, and this did not change in 2023, although Poland’s TEA rate of 2.6% was a substantial improvement from 1.6% in 2022. There is some way to go before Poland’s percentage
of adults starting or running a new business is back to the pre-pandemic rate (5.4% in 2019). The data
gives some hope that a corner may have been turned. Poland does much better for established businesses: nearly 12% of the adult population. This implies that more than four people own an established business for each person starting a new one, a ratio that may make it difficult to replenish the stock of Polish established businesses.

On a social level, perceptions of entrepreneurship in Poland are on par with many European economies. Despite the low level of TEA, around a half of Polish adults know someone who has recently started a business, and a similar proportion consider themselves to have the skills and experience to do the same. Meanwhile, around three in four adults see good opportunities to start a business, although a half of these would not do so for fear it might fail. Despite these comparable perceptions, the percentage of Polish adults who expect to start a business in the next three years is 2.6%, lowest of all GEM participating economies in 2023 by a substantial margin. One shadow over business intentions may be that nearly one in two adults reported their household income had fallen in 2023.

Of the few who were starting or running new businesses in Poland in 2023, earning a living because jobs are scarce was the dominant motivation, while a half expected to use more digital technology in the next six months.
 

1. Forecasts from European Commission, 15 November 2023.

2. A brief description of the GEM approach is given in the GEM Global Report.