TCS Daily

e-Poland at the End of e-Europe

By Tomasz Teluk - October 20, 2003 12:00 AM

Poland's economic strategy pushes it to the margins of modern Europe. In the absence of significant private investments in science, particularly in information technologies or the engines of the knowledge-based economy, Poland has no chance to leave its current outsider position and catch up to Estonia, Hungary and the Czech Republic.


Poland's situation is dramatic. The condition of Polish science is especially poor. The centralized control over production of knowledge is limited to subsidizing unprofitable projects and maintaining jobs for the employees of more than 200 budget-funded research and development units. As a result, various institutes and R&D centers absorb the money and focus on development of the archaic bureaucracy. Despite some unquestionable achievements in a few of the fields of research, financing of the unnecessary research projects and thousands of uncreative research workers with taxpayer money is a waste that no country can afford.


This is true for the IT sector as well. A longstanding monopoly in telecommunications has been thwarting the sector's development and is detrimental to the whole economy. Other actions of the government, such as licensing the businesses that provide access to the Internet, dividing the electronic signature market between companies that are controlled by the state, favoring a select group of information technology providers that has no market justification, and limiting the possibilities for Internet services outsourcing in projects of computerization of territorial administration, have made life rough for entrepreneurs, who should constitute the driving force of the New Economy. Often, the only solution left for them is to enter into corrupt relationships with the authorities. Research done by international non-government organizations confirm this scenario.


There are too many warning signals to pretend that after full accession to the EU, Poland will enjoy unlimited development. The European Commission has set high standards for the new countries that are meant to reduce the technological distance between them and current members. Poland has not met the criteria. For example, the level of e-government, i.e. the administration services based on the Internet, is about four times lower than in the most advanced countries, Ireland and Sweden, and nearly three times lower than in Portugal and Spain, which are in the middle of the ranking within the EU. This means that even the information needs of citizens who want to follow the law on access to public information have not been fulfilled.


Polish businesses do not know how to use the money that European institutions have been earmarking to support IT initiatives. They are not prepared to compete for money, and that is why they receive just a half of what companies in the Czech Republic get, and over 30 times less than companies in France and Italy. The position of Polish IT companies looks pale to their peers in other EU candidate countries. In the recent ranking Fast 50, which listed the most dynamically developing technological companies in Central Europe, there were only few Polish companies, while most businesses are from Hungary, Czech Republic, Slovenia or Slovakia. Competitiveness of Polish enterprises is affected not only by the draconian fiscal policy of the state, and the lack of assistance funds, but also by the deficit of knowledge about functioning of international business and by attempt to imitate rather than to innovate.


The Polish government has finally started to talk about a "knowledge-based economy" (a term first used by Austrian School economist Fritz Machlup, and adopted by the EU in the Bologna Declaration signed in 1999). Brussels is now implementing the assumptions of the Sixth Framework Program, which defined the targets for 2002-2006. The European Commission advises integration of the three pillars of the New Economy: e-business, e-government and e-learning. Detailed directives of the EU are included in the document e-Europe 2005.


In the current EU member countries, the level of development of electronic public services is high. In UK and Scandinavia, most official business can be done via the Internet; this applies both to businesses and individual citizens. A study made by Cap Gemini Ernst & Young for the European Commission shows that in 19 out of 20 administrative services, including registration, issuing permits, making payments, and disclosing information are provided online. In 80 percent of the EU countries, it is possible to pay taxes via Internet, and in more than half, it is a normal procedure to deal with registration this way.


Against this background, the achievements of e-Poland must seem disappointing. Even the least-developed EU countries in this area, Belgium and the Netherlands, are more than twice as developed as Poland. Global comparisons are even less encouraging. According to Brown University in the US, Poland is ranked behind Egypt, Nepal and Chile, and just in front of Kenya, Bahrain and Belarus.


The Polish answer to the challenges of information society is the program "Polish e-Government", which calls for making up for the large gap between Poland and the current member countries by 2005, and is meant to prepare the Polish administration for the EU integration after it joins the bloc in 2004. However, a report by the research firm I-Metria shows e-government has not been developed fully at the local levels, so don't expect that Polish e-government will catch up with least-developed European countries any time soon.

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