More Money, Modest Results: Poland Still at 66% of EU Innovation Average

ECONOMYMore Money, Modest Results: Poland Still at 66% of EU Innovation Average

Over the past decade, Poland has significantly increased spending on research and development, yet this has not translated into a meaningful improvement in the country’s position within the European innovation system, according to a report by the Sobieski Institute titled “Innovation or Drift. Poland’s Growth Map 2026–2035.” The authors note that Poland’s score in the 2025 European Innovation Scoreboard amounts to approximately 66 percent of the EU average. Although this represents progress compared to 2015 levels, Poland still remains in the category of an “emerging innovator.”

The report shows that R&D expenditure rose from around 1 percent of GDP in 2015 to 1.56 percent of GDP in 2023. Total spending reached PLN 53 billion, marking more than a threefold increase in eight years. The structure of innovation financing has also changed substantially. The share of the business sector in funding R&D activities in Poland increased to 65 percent, compared with around 39 percent in 2015. Corporate R&D spending reached PLN 34 billion, nearly a fivefold increase over the past decade. However, the report emphasizes that Polish companies’ innovation efforts are still largely based on adaptation and process improvements, with weak cooperation between science and business and limited access to private capital.

“Innovative companies in Poland cannot grow very quickly. They point to several fundamental constraints. First is access to financing. Although there are considerable European funds for innovation, if the evaluation process takes 18–24 months, that is simply too long for an innovative company. Access to fast, flexible capital is one of the key limitations,” Jadwiga Emilewicz, board member of the Sobieski Institute, told Newseria.

According to the report’s authors, the average evaluation time for R&D projects in major public competitions in Poland exceeds 12 months. In the best-performing European systems, the process typically takes between two and three months.

“The second constraint is the lack of private investment capital — venture capital funds willing to invest in the early stages of growth. Today, innovators in Poland say that venture funds behave somewhat like commercial banks. They become interested only when the product is nearly complete and already generating profits,” Emilewicz explains.

Poland’s high-risk capital market remains less developed than those of the most innovative EU economies, particularly when it comes to early-stage financing of technological projects.

“We also lack coordination among development institutions. We have a highly fragmented ecosystem — the Polish Development Fund, Bank Gospodarstwa Krajowego, the Industrial Development Agency, the Polish Agency for Enterprise Development, the National Centre for Research and Development — all reporting to different ministers. If we want to treat innovation seriously, it must become a real priority under a single governmental owner. We lack a genuine agency modeled on the American DARPA — a defense innovation agency. In our report, we call it ‘Orion’ and propose its model. It would focus on dual-use technologies, with fast decision-making, rapid piloting, and swift financing,” the co-author says.

The Sobieski Institute argues that the existence of multiple parallel public agencies leads to duplication of support instruments and increases procedural complexity for businesses. The absence of a single coordinating center for innovation policy makes it difficult to implement a coherent development strategy. This affects both the efficiency of public spending and the predictability of support for companies implementing technological projects.

“In our report, we propose a set of organizational solutions related to coordination at the government level, as well as very practical instruments. In addition to the Orion agency, we propose a package of tax tools,” Emilewicz adds.

Tax incentives remain one of the main instruments supporting corporate R&D activity. In 2023, more than 2,500 taxpayers benefited from the R&D tax relief, with total eligible costs amounting to PLN 9.2 billion. Unlike grant systems, this mechanism leaves decisions about research directions in the hands of companies.

“The R&D tax relief has proven effective and can be significantly enhanced. A 200 percent deduction of R&D expenses would give innovators a strong sense of security. It signals that taking risks pays off because that risk is mitigated through the tax system. We also propose expanding the scale of the so-called ‘Estonian CIT,’ allowing companies to benefit from deductions over a five-year horizon. Finally, we point to an instrument that already exists in Polish law — pre-commercial public procurement — but which accounted for less than 0.5 percent of all public procurement last year,” Emilewicz lists.

Experts argue that such a system would reward implementation rather than “project writing” and shorten the path from technological concept to market deployment.

They emphasize that Poland’s technological policy in the coming decade should focus on two complementary pillars. The first would cover sectors in which Poland already has a strong base of companies and competencies.

“We identify areas related to agri-tech. Poland is one of Europe’s leading food producers, so innovation in agri-tech appears very promising. We also highlight medical innovation — medtech. Finally, the third area is modern mobility. With companies such as Pesa, Newag, and Modertrans, we can achieve a great deal in this market,” Emilewicz argues.

The second pillar should focus on strategic technologies critical for security and sovereignty, requiring a more active role of the state. These include semiconductors, predictive medicine and longevity, new energy solutions, space technologies, AI factories, and quantum cryptography.

“We want our recommendations to serve as a proposal for the Future Council — to identify concrete technologies on the one hand and propose legislative and organizational reforms on the other. With two years left in the current term, it is a challenging time for sweeping reforms, but perhaps the authority of the individuals gathered in the Future Council will inspire the government to implement these changes. Let us ensure it does not become merely an organization that looks good in photographs,” Emilewicz stresses.

The Future Council, established on February 10 by Prime Minister Donald Tusk, is intended to function as an advisory body. It will prepare proposals regarding long-term directions for Poland’s development, including economic, technological, and innovation policy. Its members include representatives of academia, experts, and managers associated with the technology and industrial sectors.

“The Future Council was created to fight for how innovation can be implemented in Poland and how to accelerate the journey that innovative ideas and new technologies take from science to business,” explains Prof. Piotr Sankowski of the University of Warsaw, Director of the IDEAS Research Institute and a member of the Council. “Supporting innovation in Poland is crucial for economic development. What matters is benchmarking against European standards and showcasing countries where science-business cooperation works effectively. In many countries, such as Denmark, appropriate cooperation mechanisms have led to significant increases in R&D spending.”

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