Geographical breakdown of Polish OFDI – explanatory potential of Uppsala model

Abstract

Last decade proved that internationalization becomes the more and more important growth strategy for Polish companies. e paper attempts to nd whether they choose to invest abroad in line with the framework of Uppsala model, i.e.: start to establish foreign entities in one or a few neighbouring countries rather than on distant markets and precede production relocation by establishing trade units. e research provide evidence that Polish rms prefer this conservative model of internationalization. Up to 2011 almost 85% of all foreign entities were based in Europe while over a half of them (and slightly more than 60% of industrial companies) were located in the immediate neighbourhood (Germany, the Czech Republic, Slovakia, Ukraine, Belarus, Lithuania, and Russia). Moreover, the highest turnover was also recorded in the closest markets (especially Germany and the Czech Republic). e analysis also shows that in general, the share of manufacturing entities was dominated by trade rms.

Rapid FDI expansion of firms from emerging markets: evidence from Poland

“…investing in countries that are culturally and geographically close to the home country. Up to 2011, Polish companies invested in almost 100 countries and the majority of them (almost 85%) were based in Europe, while immediate neighbouring countries, such as Germany, the Czech Republic, Slovakia, Ukraine, Belarus, Lithuania and Russia, accounted for over a half of Polish companies' foreign entities (Klysik-Uryszek and Kuna-Marszalek, 2015). By doing so, they follow the traditional Uppsala model (Johanson and Vahle, 1977).…”

A literature review on CEE firms’ internationalization: success measurement, achievement and outcomes

“…Growth-related indicators have been also very popular. For example, according to Bodlaj et al (2020) and Kłysik-Uryszek and Kuna-Marszałek (2015), increased export share during a three-year or some other time period is also a sign of successful internationalization as it shows more engagement in international operations. However, these authors did not state how much the export share should increase to consider a firm “successful”.…”

“…In general, all authors agreed that slow internationalizers should start entering foreign markets several years after foundation (Ferencikova and Hluskova, 2015; Zapletalová, 2015). There is also relatively strong consensus on foreign market choice: such firms should enter one or a few geographically closest and/or culturally more similar markets in the beginning, and, thus, their most likely choices are other CEE or Commonwealth of Independent States (CIS) countries or neighbouring Western European markets (Annushkina, 2014; Atnashev and Vashakmadze, 2016; Ferencikova and Hluskova, 2015; Kłysik-Uryszek and Kuna-Marszałek, 2015; Zapletalová, 2015). The first entry mode is usually exporting (Zapletalová, 2015).…”