Poland is located in Central Europe and is bordered by Germany, the Czech Republic, Slovakia, Ukraine, Belarus, and Lithuania. The Baltic Sea is located to the northwest. Slightly smaller than New Mexico, the countrys terrain is largely flat with iilountain ranges along its southern border. Its climate is relatively cool, with moderately severe winters and mild summer temperatures. Polands natural resoiu ces include coal, sulfur, copper, natural gas,silver, lead, salt, amber, and arable land. 77 Polands Population, estimated at 38,562,000, has remained steady for the last several yenrs. Poland, with a median age of 40 years old, has an older-than-average population. The country is essentially entirely made up of native Poles. Immigrants do not comprise a significant proportion of the population. Poland has no citizenship by birth; instead, citizenship is awarded by descent, which requires both parents to be citizens of Poland. The coun- tiy is almost exclusively Roman Catholic.

Poland's GDP stands at US$545 billion, or US$24,952 per capita. Unlike most of Eulope, Poland has seen years of steady economic gains. In 2015, the economy expanded at 3.5 percent.⁷' Poland was one of the only countries in the Euiopean Union to avoid a recession during 2008 2009: The government of Prime Minister Donald Tusk steered the Polish economy through the economic down- turn by skillfully managing public finances and adopting COlltFOVersinl pension and tax reforms to further shore up public finances. Once a largely agricultural nation, the countrys economy lfas transitioned to one based primar- ily on industry (41 percent) and services (56 percent).' The labor force, with 18.29 million people, ranks 34th in the world in size." Polands main export partners include Genrany, the UIF, the Czech Republic, France, Italy, the Netlierlancls, and Russia. Machinery and transportation cquipment, intermediate manufactured goods, miscella- neous manufacturecl goods, foodstuffs, and live animals are all major exports.'²

Polnn has adopted a republic form of government. It was one of the first ex-communist countries to embrace aeapitalistic economy with rrivatization and economic lib- eralization. The country's economic success following the fall of the Soviet Union was largely attributed to the gov-ernments success at privatizing most of the small and medium state-owned companies and encouraging foreign direct investment. Polands major difficulties lie in its somewhat deficient infrastructure, its rigid labor codes, a burdensome commercial court system, its extensive government red tape, a lack of energy mix, and its burdensome tax system. You Be the International Management Consultant Tesco, a multinational grocery and general merchandise retailer, operates over 6,000 stores around the world and 442 stores in Poland. Tesco has a large online presence and handles online or ders for customers in its various markets. The company has enjoyed considerable success across the world but has faced some recent difficulty with its Polish investments. The Polish government has recently announced a plan to increase revenues to pay for various initiatives, includ- ing the proposed imposition on large tetailers of a 9 percent tax on gross revenue. This tax is targeted at foreign-dominated industries like supermarkets and banks. Moody's estimates that this new tax could cost Tesco as mucii as 3.5 percent of earnings.

Questions "

1. If you were a consultant for Tesco, how would you advise Tesco to deal with the new tax7
2. Would this new tax be enough for you to advise the company to end business in Poland?
3. Does the fact that tliis regulation is specifically targeted at foreign-dominated industries and businesses create concern for future regulations should you choose to continue operations iii Poland?