The World Bank Put Central Europe's Productivity Gap Inside Domestic Firms

The World Bank's EU Regular Economic Report, published March 12, 2026, priced what Bulgaria, Croatia, Poland and Romania could gain from wider use of software and AI-enabled tools at 10–15% higher labor productivity. Anna Akhalkatsi, the World Bank Group's Division Director for the European Union, framed the task as raising productivity through digital adoption, skills and predictable rules rather than as attracting more capital. For a region whose convergence was built on trade integration and European supply chains, that is a change of instrument, and the report is explicit that the old model is running into shrinking working-age populations and tight labor markets.

In Poland, 26% of corporate investment goes to intangible assets, meaning software, research, data and management improvements, against 37% across the EU. Research and development spending across the four countries sits under 1.5% of GDP against an EU average of 2.2%, but the intangibles ratio is the one that does the analytical work, because intangibles are what a firm buys when it is trying to work differently rather than to work more. The report finds the smallest firms, particularly in Bulgaria and Romania, furthest behind on digital adoption.

That is a diffusion problem, and it falls across the seam of a promotion agency's mandate. An agency is measured on the capital it brings in. The firms the World Bank describes are already there: mostly small, mostly domestic, mostly absent from any account list. They are also the supplier base that every foreign plant in the region draws on, which means an agency's existing investors have a direct commercial interest in a capability the agency does not currently sell.

Romania shows how the instruments divide inside a single agency. On June 9, 2026, the Romanian Agency for Investment and Foreign Trade announced that from June 15 all registration for the state-funded Export Promotion Programme would run through one digital platform, and that every Romanian stand at an international trade fair would follow a single brand manual. More than 800 companies use it each year, and ARICE president Daniel Constantin tied the effort to a trade deficit the National Institute of Statistics put at €32.7 billion for 2025. Stand design is shop-window work. The rest of the same announcement does something else. ARICE coordinates Team Romania inside the EU's Global Gateway, and the services it lists there are sector tender alerts, help entering consortia with European partners, and assistance preparing pre-qualification dossiers for the European Investment Bank and the EBRD. Writing a pre-qualification dossier changes what a firm can bid for the next time one is due, which is the capability the World Bank report says is missing.

These ratios may be a composition artifact. Central Europe specializes in production stages that genuinely require less research, so a manufacturing-heavy economy would post a low research share even if every firm were behaving sensibly, and no agency has a lever over whether a Polish parts supplier buys a software license. That objection is partly right, and it does not survive intact. Czechia runs the same foreign-investment-led manufacturing model and recorded research and development spending at 2.0% of GDP in 2021, on World Bank figures reported by Science|Business in September 2024, with roughly 60% of it privately funded, against Poland's 1.4% in the same year. Composition explains part of the gap. It does not explain the distance between 1.4% and 2.0% in two economies running much the same playbook. Should labor productivity in the four countries converge toward the EU average over the next three to five years with no rise in intangible or research intensity, the composition account is vindicated and this one retires.

ARICE has said the next stage of its digitalization is the public procurement procedures attached to the Export Promotion Programme. It has not given a date. The first major Global Gateway contracts are due to be awarded across 2025–2027, from a facility the EU raised to a €400 billion target for 2027 after mobilizing €306 billion by October 2025.