Newspaper article The Christian Science Monitor

Business Help for Poland Poland Needs US Advice and Investment for Its Shift to a Market Economy. Here's What Warsaw Must Do to Lay the Groundwork

Newspaper article The Christian Science Monitor

Business Help for Poland Poland Needs US Advice and Investment for Its Shift to a Market Economy. Here's What Warsaw Must Do to Lay the Groundwork

Article excerpt

LECH WALESA recently made his second visit to Washington to meet with President Bush and United States business leaders. He expressed his continued concern about the widespread lack of US business investment in his homeland.

Poland indeed desperately needs US technical advice and investment if it is to complete its transition to the free market. And Poland's success or failure may determine the extent of reforms in other nations, most notably Bulgaria, Romania, and perhaps even the Soviet Union.

Unfortunately, while Poland has made tremendous progress in dismantling the communist economy, many essential building blocks of a free market have yet to be set in place. These delays have forestalled much-needed US investment in Poland.

Here's what Mr. Walesa must do if he is to entice US investment to Warsaw.

- Poland must be more active in marketing itself to the American business community. This should be the No. 1 priority of the Polish embassy in Washington. Without critical economic information, US companies can hardly be expected to risk millions investing in Poland. There is widespread confusion and misinformation in the business community about what steps Poland has or has not taken on the road toward capitalism. A coordinated public-relations program by the Polish embassy could easily solve this problem.

- Poland's Sejm (Parliament) must move rapidly to implement the government's excellent investment law and ratify the US-Poland Business and Economic Treaty, which was signed by Mr. Bush last year.

- Although Poland passed a privatization law for 7,600 large enterprises last July, final regulations were not set in place until December, and so far only a minuscule percentage of state-owned assets has been put on the auction block. In addition, some analysts argue that the re-privatization of shops and farms confiscated by the communist government in the '40s and '50s would have even more of an impact, creating a middle class almost immediately.

- The revamping of real estate laws has also languished in the Sejm. American businesses have complained that it is nearly impossible to lease or buy most real estate. Much of the available real estate is controlled by local governments which have been charging outrageous rates for rent of shops and market space. The government should not be the country's biggest landlord.

- American businesses have also cited the excessive delays in obtaining approval of foreign investment. Some blame this on the relatively large numbers of communist bureaucrats still employed in many state agencies. A US Overseas Private Investment Corporation (OPIC) official calls this "one of the most serious problems" facing American companies. Recent legislation may ease the problem, although the OPIC source points out, "A law is only as good as its implementation. …

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