Poland in the European Union
Poland became a member of the EU on 1st May 2004, together with nine other countries, marking the culmination of a negotiation process which first began on 31st March 1998. On 21st December 2007 Poland joined the Schengen area: a territory with no checks at internal borders formed in the 24 member States.
The main benefits for Poland from joining the European Union are:
- harmonisation of Polish law with EU regulations,
- access to over 460 million customers within the EU,
- the possibility of applying for EU structural funds,
- infrastructure development.
The harmonisation of Polish law, as well as access to EU structural funds, has helped to increase the attractiveness of Poland for foreign investors. The European Union is now Poland’s largest trading partner. Today, after 12 years of joining European Union Poland has become a signifi cant political player in the European Union, winning a strong political position and the reputation of a country that is predictable and responsible.
Poland in the Single European Market
As a member of the European Union, Poland participates in the Single European Market. The freedom of movement of people, goods, capital and services makes this market much more competitive.
The freedom of movement of people is very important, especially with reference to freedom of movement for workers. The last restrictions for Polish employess were rescinded in May 2011. Since then, no national regulations of Member States may ban Poles to work within Member States (with regards to domestic rules).
The freedom of movement of goods is one of the fundamental principles of the single market. It constitutes the prohibition of quantitative restriction on exports and imports between Member States. It is the rule that products complying with the standards set in the Member State of origin shall also comply with the standards of the Member States of destination.
The freedom of movement of services implies the rights of individuals and companies to offer and provide services without hindrance in all EU Member States. EU Treaty regulations on the free movement of services essentially cover all types of services provided against payment. Individual citizens and companies have the right to offer and provide services in other Member States on the same terms as those applied to the country’s own citizens and companies.
Any obstacles to the freedom of movement of capital are prohibited according to EC treaty. EU citizens must be able to transfer unlimited sums of money between Member States, open bank accounts, invest funds or borrow money in other Member States. EU citizens who move to another Member State to work or retire must have the right to transfer money from one EU country to another.
Poland and the European Monetary Union
The next stage of integration is the accession to the European Monetary Union as well as the adoption of the Euro as the official currency of Poland. The crisis within Eurozone has put the great pressure on Polish authorities to delay the adoption of the Euro.
The unofficial plans are to fulfill all requirements in the coming years, but the adoption of the Euro will require an amendment to the constitution.
The basic requirements for joining the Euro are the Maastricht criteria of economic convergence, including fiscal (the general government deficit and public debt) and monetary criteria (price stability, the level of long-term interest rates and exchange rate stability). The fulfillment of the exchange rate criterion will be preceded by entering into ERM-2.
From 24th January 2009, it has been possible to conclude agreements and provide performances in foreign currency in Poland pursuant to the amendment of Article 358 of the Civil Code and the deletion of § 9 Section 15 of the Foreign Exchange Acts. There are currently no obstacles to making payments in Euros.
Poland in international organizations
After 1989, Poland began an intensive period of economic development, supported by its membership in various international organisations. This helped to accelerate development, promote globally the Polish economy and enabled collaboration with other countries. Currently, Poland is a member of:
- The Organisation for Economic Cooperation and Development (OECD),
- The North Atlantic Treaty Organization (NATO),
- The World Trade Organization (WTO),
- The World Bank,
- The International Monetary Fund (IMF).
The Organisation for Economic Cooperation and Development was set-up by the Convention of 1960, which came into force one year later. The headquarters of the institution is located in Paris. The main objective of the OECD is to coordinate socio-economic policies of the Member States in order to stimulate economic growth, employment, social development and international trade and capital flows. Therefore, the organisation develops common rules to be applied in different areas of the economy, which takes the form of recommendations, resolutions, declarations and agreements.
The organisation includes the most economically developed countries to create ‘the richest club’, an exclusive organisation representing less than 1/6 of the world’s population, and providing about 2/3 of the global production of goods, 3/5 of world exports and 4/5 of the total public development aid.
Poland started its cooperation with the OECD in 1990 and became a member in 1996. Thanks to its OECD membership, the regulation of foreign investment and changes in the foreign exchange law in Poland has been carried out more quickly. Its membership in the most prestigious club of economically developed countries in the world is concrete proof of Poland’s current economic stability. This undoubtedly improves the global image of Poland, because we are now seen as partners with a strongly growing economy and stable legal rules. Membership in the OECD facilitates access to preferential credit lines provided by international financial institutions. In addition, through its membership in the OECD, Poland was given the opportunity to co-liberate in the global economy, as well as forming a new identity for the OECD.
NATO, the North Atlantic Treaty Organization the political-military organization was established on 24th of August 1949 basing on the Treaty of Washington in April 1949 which was signed by 10 European countries and the United States and Canada.
NATO’s purpose is to put the collective protection of its members as a basis for keeping peace and strengthening international security. Its main objective is to ensure – by political and military means – the freedoms and security of all its Member States.
It obliges each Member State to share the risks and responsibilities, as well as the benefits of collective security. According to NATO’s principles its Members shall not enter into any other international commitments that might conflict with this Treaty.
In 1997 the Alliance invited the Czech Republic, Poland and Hungary to negotiate with a view to adopting them as members of NATO. The Polish accession to NATO on 12th March 1999 was one of the most important events in the modern history of our country. This alliance forms the basis of Polish security and defence; it is also a major factor in the political-military stability in Europe.
The World Trade Organisation was established on 1st January 1995. Poland was one of the founding countries. The main responsibility of the WTO is the liberalisation of the international trade of goods and services, investment policies of trade support, the settlement of trade disputes, and the respect for intellectual property rights. Countries acceding to the WTO are required to adapt domestic legislation to the standards of the World Trade Organisation and to grant concessions to foreign entities. The WTO has 160 members at present, the most recent to join being Yemen. The WTO has eliminated many barriers between countries and people by reducing tariffs. The rules of the WTO (contained in agreements and contracts) are the result of negotiations among the WTO members. The core document is the General Agreement on Tariffs and Trade (GATT). GATT comprises 60 agreements, which were signed individually in specific areas by each Member State.
The World Bank has operated since 27th December 1945, and its headquarters are located in Washington DC, USA. Currently, its main task is to support the development of the market economy whilst combating all the causes of poverty in the world. Poland acceded to the World Bank (WB) in 1986. The President of the National Bank of Poland represents the country in the meetings of the WB. From 1990 until 1996, Poland received funds from the World Bank (equivalent to USD 3.374 billion) to assist in the transformation of Poland. Of this money, 46% was spent directly on the restructuring of the Polish economy to adapt it to the principles of the free market trade. By the year 2000, the WB supported the development of private sector industries and environmental protection. Today its function is gradually starting to comply with the European Investment Bank.
The International Monetary Fund has existed since 1945, while it has been operating on a permanent basis since 1947. Currently, it has more than 180 members, including Poland. Its head office is in Washington, USA. Its main tasks are:
- the development of international cooperation in the field of monetary policy,
- securing the stability of exchange rates,
- monitoring the international debt of Member States,
- supporting the development of trade in the world.
Poland has been a member of the IMF since 1986, at which time Poland received 1.8 billion SDR units (Special Drawing Rights, which function within the IMF as a unit of account). In 1995, Poland was able to repay its debts incurred in international institutions, before becoming a full member of the IMF.
Source: Polish Investment and Trade Agnecy, Investor's Guide - Poland: How to do business 2016.