POLAND is one of Europe’s post-communist success stories, boasting more than two decades without a recession. But ask many Polish entrepreneurs when the country had the best conditions for running a business and the answer, surprisingly, is 1988, the last year of communist rule.
That was when Mieczyslaw Wilczek, an inventor and entrepreneur, took the reins as industry minister and pushed through a radical law that broke with communist orthodoxy by ending most business restrictions. “Undertaking economic activity is free and permitted to everyone,” read its opening paragraph. Instead of being hampered by communist regulation limiting the number of workers a company could employ and forcing would-be entrepreneurs through regulatory hoops, it now became very simple to start a business. Within two years almost 2m new ones were opened.
Mr Wilczek died last month at the age of 82, but the law that bears his name (and was in force, albeit amended, until 2000) is still a touchstone for business-friendly regulation.
The law did not save the ailing communist regime , which lost power to the opposition in 1989, but it did set off a wave of new business creation, the harbinger of the explosion of entrepreneurship, which has transformed Poland over the last quarter century.
In the years since, business regulations became ever more entwined with red tape, as Mr Wilczek’s simple 54-article law was replaced by more baroque legislation. Lewiatan, the employers confederation, compiles an annual list of “black barriers” to business in Poland, a list that is only very slowly shrinking.
“It’s hard to talk about a breakthrough in the battle against bad regulations,” said Henryka Bochniarz, the head of the confederation, at the group’s conference on red tape last year. Her main complaint was that social security taxes continue to place a high burden on employers. But there have been some improvements; in 2012 government slashed the time needed for a new business to get a tax number from 14 to three days, while also reducing the time it takes to register a new company by two days, among other changes.
But the state still creates many problems for business. The best recent example is the languid attempt at passing legislation governing the shale gas sector; delays are creating uncertainty and driving away investors.
The government says it is aware of the problem and is trying to make life easier for entrepreneurs. Poland scaled up the World Bank’s Doing Business rankings recently, rising by 29 places in the last two years, to 45th place in the global ranking of 189 economies. That puts Poland above many of its central European peers, but still below most advanced western European countries.
To climb further up the list, Mr Wilczek and his succinct law may well be the model to emulate.“Wilczek’s law was the golden age of Polish capitalism, it was never easier to open a business,” says Andrzej Blikle, former head of one of an eponymous chain of bakeries and coffee shops
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