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The government to allocate 220 million PLN to a new system to boost investment
( 29 / August / 2008 )
The Ministry of Economy devised a new system to boost foreign investment in the frame of long-standing programmes. On August 28th the project allocating 220 million PLN to the purpose was passed by the Council of Ministers.
The system is thought to create and develop a financial support instrument able to encourage entrepreneurs planning to invest in Central and Eastern Europe that Poland is the best destination to develop their projects.
Financial support is to be granted in form of subsidies regulated through contracts concluded between an investor and the Minister of Economy. The beneficiary receives the grant throughout a period of one to five years in annual instalments depending on the progress of a given project and in accordance with the previous commitments. The subsidy may account for 15% of the investment costs in case of a project realized in a special economic zone or may cover up to 30% if an investment is realized outside SEZs.
Among those who are entitled to apply for the financial support are companies planning to realize projects in one of key sectors, in the methodology used by the OECD the sectors tend to be defined as high tech i.e. IT, BPO and R&D sectors as theses sectors generate the highest value added for the economy. Yet the automotive, electronic, aviation, biotechnology and telecommunication industries are also perceived as top priority sectors.
The financial support could be twofold. Firstly, the support may compensate the initial investment costs; secondly, it may be allocated to boost job creation strategies.
To be able to apply for initial investment costs rebates a company should fulfil the following:
Operate in one of the key sectors
Invest a minimum of 160 million PLN
Create a minimum number of 50 workplaces
To be entitled to obtain support to improve the job creation capacity a company should fall into one of three possible categories:
Create 250 jobs and invest 40 million PLN in the project
Create 500 jobs and incur 1 billion investment costs
Create 250 jobs in the modern services sector
Interestingly, an investor who plans to hire only 35 people with university degrees but wants to invest as much as 3 million PLN in an R&D investment may also feel free to apply for the government’s subsidies.
’System of supporting foreign investments vital for the Polish economy’ devised by the Council of Ministers determines principles and procedures of granting support for new investments on the basis of long-standing programmes and provides useful and practical guidelines for the inter-ministerial work group which is to assess foreign investors’ applications.
Ministry of Economy