Entrepreneur Arkadiusz Mus: “It was beyond my comprehension what kind of bubbles some people live in on a daily basis.”
It is difficult to do business with a country whose politicians are detached from reality and do not understand today’s world because they are afraid of it, says Arkadiusz Mus, founder of Press Glass, No. 9 on Forbes magazine’s list of 100 richest Poles and owner of assets worth more than PLN 4.5 billion, about Poland under the rule of Law and Justice (PiS).
Forbes: You have been the loudest critic of PiS among major Polish businessmen, openly but at the same time realistically supporting measures that could change the government. How do you feel now?
Arkadiusz Mus: Very satisfied. Speaking the language of business, we managed to achieve a result that will allow the liberal-democratic forces to form a coalition. And it’s not just me. On the Monday morning after the election, I received dozens of emails, messages and phone calls from our business partners and clients around the world congratulating us on the turnout and the huge mobilization at the ballot box. This shows how important it is to stop the PiS government, not only from our point of view. Few countries have managed to remove dangerous populists from power. In our region, there has been no change in Hungary for years, and the populist left could come back to power in Slovakia. We were able to make a change in Poland, and this gives hope to others who are fighting for the principles of liberal democracy.
The markets have also responded enthusiastically, lifting the Polish currency zloty and the stock market, especially the shares of state-owned companies.
Perhaps too enthusiastically, I think, because there is nothing to suggest that the changes will be quickly reflected in the economy, even with the “recovered” money from the EU National Recovery Plan. All the more so because the burden will be on the poor public finances, since PiS lost all moderation on this issue at the end of its term, openly buying votes with more social expenditures, raising exaggerated expectations and not looking at the costs.
But the investment climate will certainly change. We will finally normalize relations with our main economic partners, such as Germany and the rest of the EU. We will be able to strengthen our position in the common European market. The economic leap we have made since joining the EU makes us, as a country, an increasingly important piece of the puzzle of global market business relationships.
It is hard to do business with a country whose politicians are detached from reality and do not understand today’s world because they are afraid of it. And it is a known fact that Poland’s strong economic position in Europe and the world is the real reason for its getting up from its knees.
It is not the case that Poland has become an investment desert.
Of course, large corporations do not look at investment decisions through the prism of a single term of government, even by a very extreme party. However, the situation is not good, the numbers speak for themselves. Since 2015, the investment rate as a percentage of GDP has fallen from 20.4 to 16.8 percent. We are behind the Czech Republic or Hungary, which we like to compare ourselves with. And foreign investors are a big part of that. Many of them have kept their investments to a minimum, refinancing them with what they had previously earned in Poland. And to attract the really big, serious players, the government had to “buy” them with subsidies.
What do you expect from the new government?
In terms of?
Well, in terms of concrete actions. For example, retail chains are counting on the promised return of stores being open on Sundays, the owners of large energy-intensive enterprises would like to see facilitation and support for renewable energy.
I do not expect the new government to do anything concrete for my company or my industry. Restoring the rule of law, rebuilding relations with the European Union, and releasing the EUR 60 billion from the National Recovery Plan will be key. But these are the obvious things that all voters voting for the democratic opposition are counting on. Poland also needs more economic freedom and a responsible fiscal policy. I am counting on professional due diligence of all assets and projects implemented by PiS. Just like in business, you need to thoroughly analyze the assets you are taking over to plan your future steps sensibly.
And who should evaluate this, politicians?
No, hired professionals. Well, everyone in Poland will answer in the affirmative to the simple question – would it be good to have an intercontinental air hub. But we do not know how much it is worth investing in such a project to make it economically viable. Perhaps increasing passenger or cargo traffic would be cheaper than embarking on a bombastic project costing PLN 40 billion in the first stage alone. It is also a question of what alternatives we have and how best to manage the budget money coming from the taxpayers. I am talking about opportunity costs.
Even more impressive is the PLN 234 billion that the outgoing government plans to spend on rearming the military.
This is to be financed with even more debt. Of course, everyone would like to have the best-armed military, but at the same time, we are a member of NATO, protected by mutual military assistance commitments. And spending on new armaments cannot be decided in isolation from our security guarantees on the one hand, and the fact that we are burdening future generations with debt on the other. In this dimension, too, there is a need for a thorough audit of all assets and companies taken over after PiS.
Together with your daughter, you opened the list of Civic Platform donors. And the Economic Freedom Foundation, which you founded, supported the fight for the rule of law. Did you set up the foundation with the elections in mind?
No, I take a long-term view of such projects. For years, I co-financed the activities of Civil Development Forum (FOR), the foundation created by Leszek Balcerowicz, and at the same time, the number of social initiatives I supported grew. Given the scale of my involvement, I decided it would be good to institutionalize this activity. And so the Economic Freedom Foundation (FWG) was born. Our goal is to make Poland a prosperous and open country where people simply live well. And the means to achieve this are the rule of law, the free market, tolerance, and efforts to develop a liberal democracy with a strong civil society. That is why FWG has financed the very useful activities of the Civil Development Forum, Free Courts, the Freedom Games and many other democratic foundations.
The introduction of free market principles has created new opportunities, which thousands of Polish entrepreneurs have successfully taken advantage of. How do you assess the commitment of your colleagues to the defense of liberal democracy?
I will not hide the fact that I was quite shocked. It was beyond my comprehension to learn what kind of bubble some of them live in on a daily basis. Many entrepreneurs do not see the world outside their companies – albeit often large ones. They do not understand that the rule of law and liberal democracy are not self-sustaining.
Some of them are probably under the illusion that these things are given to us once and for all.
But this is not the case, as we have all seen from the actions of the Law and Justice Party. It is in the common interest of all of us to take care of these values. We have built our businesses on these things, and now it’s time to share our resources by investing in civil society, a free market approach to the economy, or access to the EU common market and the eurozone. These are fundamental values for the development of our country, and we have to fight for them so that we don’t have to complain later that young people are emigrating and populists can easily manipulate voters. And that support must not end when the democratic opposition comes to power.
Investing in ideas is popular in the United States. When they decide to get involved in social initiatives, Polish entrepreneurs prefer something more tangible: helping hospitals or talented children from poor families.
These are important charitable causes, but it is also necessary to look at the long-term development of our country, and this is where investments in ideas are needed. I have already mentioned in Forbes that one of the people who inspires me to develop our foundation is Antony Fisher. He is a British entrepreneur who, in the 1950s, founded the Institute of Economic Affairs. This think-tank promoted free-market solutions. Breaking through with these ideas was a process that took decades. But it worked because in 1979, Margaret Thatcher won the election and restored the glory of the British economy. And one of the people she thanked was Fisher. That’s why I’m a big believer in social investment in the long run.
You have complained about the indifference of entrepreneurs. Meanwhile, some Polish billionaires – such as Michał Sołowow or Zygmunt Solorz – have not only remained indifferent, but in the area of energy investments, they have set their sights on cooperation with state-owned companies like Orlen or PGE.
It is difficult for me to judge individual entrepreneurs. There are certainly many examples of companies, not just the big ones, that worked closely with the previous government. Many were not talked about, they tried to remain invisible. I think that, unfortunately, we as entrepreneurs in this field, did not pass the test. I can only give the example of certain sports, such as ski jumping, where it is not only the result that counts but also the style.
We cannot limit ourselves to looking at the economy and the state only from the point of view of the interests of our own companies, not everything can be reduced to building new halls or winning new markets. We must take a broader view and invest in the development of the civil society. If we do not, populist and nationalist parties will gain strength and threaten liberal democracy.
This text was originally published by Forbes. Arkadiusz Mus was interviewed by Piotr Karnaszewski.