12
Figure 1. Value of foreign investments in Poland in the years 1993 - 2004
Source: Data of the Polish Information and Foreign Investment Agency, 2006.
After the beginning of the economic and political (democratisation)
transformation of Poland there was an increase in the interest in Poland as a place for
investing capital. The liberalisation of laws concerning business and the opening up to
foreign markets encouraged that. Many actions were undertaken, a few of which could
be mentioned as more important:
1. deregulation, that is the elimination of the role or even the withdrawal of the
state from influencing directly the functioning of the market; after the
significant deregulation at the beginning of the 1990's, there appeared, however,
a number of limitations, licences, quotas and permits later,
2. denationalisation, which means a reduction in the direct involvement of the
state in the organisation and performing of business activity,
3. liberalisation, that is focusing on the rights of the market,
4. privatisation, disposal of state property in the form of sale, re- privatisation,
transfer or leasing property; the main aim of the privatisation was to increase
the significance and share of private entities as more effective than state units
in the production and services,
5. municipalisation, transfer of some state property to local governments,
6. commercialisation, recognising the economic independence of companies which
contributes to the development of competitiveness, improvement in the
rationality of production and increase in the extent of introducing innovations
in them,
7. restructuring, changes in the resources of companies (property, employment
and quality of employees), production organisation and technologies, contacts
with the environment (outlets, marketing etc.), management and organisational
structures aimed at the adaptation of companies and organisations to the
conditions of the market economy.
Many new legal regulations, development schemes, plans and reforms were
undertaken during the transformation. The programme of L. Balcerowicz [1990] had the
greatest publicity and influence on the economy and the whole country. It contained
such actions as: "freeing" prices (liberalisation), bringing down the very high inflation
("hyperinflation"), removing barriers in foreign trade ("opening up the economy to the
world”), privatisation and re- privatisation of property managed by the State, introducing
conditions which would encourage foreign (mostly Western) investors to make new
investments and deposit capital in Poland and also creating a capital market, especially a
stock exchange. It should be stated that most assumptions made were implemented
consistently. As a result of many sacrifices of the society, the crisis was resolved and
foundations were formed for the future economic growth.
Considerable liberalism in the economy encouraged investment in Poland.
Unfortunately, in the second half of the 1990's subsequent governments departed more
and more from the economic liberty towards the ever greater number of legal
regulations, concessions and other barriers. It was reflected in the limitation on foreign
investments, especially at the beginning of the 21st century. Besides internal factors it