Question:
What have Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia got in common?
No they are not all previous Eurovision song contest 'nul points' recipients. If they were the UK would be on the list following the treasonous performance of Jemini last year.
The correct answer is that as of 1 May 2004 as part of the ongoing EU enlargement strategy they will all become fully fledged members of the EU. This will make the European Union the world's largest single market, with over 500 million consumers. This is bigger than the USA and Japan combined and with the 25 member states operating under the same rules…we will have a slightly larger, level playing field???
I'll give you a few facts about Poland who along with The Czech Republic are the most economically developed of the ten new member countries:
- Poland is the largest economy in Central Europe (GDP 190bn 2002)
- GDP is growing at approx. 5% a year
- At growth of 9% per year it would take 10 - 15 years for the average worker in Poland to be earning the same as their British counterpart.
Level playing field? I think not.
Should we be concerned? You bet!
Over the last 10 years Foreign Direct Investment (FDI) in Poland has increased exponentially from 2828m to 65000m. And why not Poland is very attractive with extremely low labour costs, nicely located and with no barriers to EU trade come 1 May 2004. This is probably why some of the largest global packaging companies are commissioning factories hand over fist all over the old eastern block.
Terry Robins ex-packaging innovation manager at Sainsbury's confirmed this in a recent Packaging News article when he warned of the impending 'eastern invasion' and described his visits to several new, state of the art packaging plants in Poland.
When you break down the FDI by country the UK is 5th on the list following France, USA, Germany, and the Netherlands. Some major organisations have / are investing heavily in Poland including Tesco who have invested 800+ million so far in over 200 stores.
EU enlargement is undoubtedly a tremendous opportunity for investors but sadly I think not for UK export trade. For Poland et al. it will be like Christmas, Easter and Eurovision Song Contest night all rolled into one, because for the foreseeable future they will have the ability to sell their products such as packaging to our customers at a price cheaper than we can actually manufacturer them. A frightening thought...
So come 1 May 2004 what is there to stop our customers from sending their buyer's on a Warsaw away day?
Maybe this: http://www.foodprodu...ews.asp?id=3748
Not a single widget of uncertified retailer branded packaging must be allowed onto these shores. The British Retailers must keep to their mandate and require all of their packaging suppliers (however cost-effective they may be) to achieve The BRC/IoP Packaging Standard. Let's hope the unfavourably sloping playing field can be temporarily chocked at least until we've had the time to improve our efficiency and competitiveness or until we have packed our own bags to Krakow.
I only hope the retailers are listening…
Regards,
Simon
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