POLAND TODAY magazine #19

How do international journalists perceive Poland? We invited them to Warsaw to find out. page 71

Entering new markets is a challenge.

PAIH trade & investment agency aims to make it easier. page 38

One of the world's finest caviar producers is located in Warmia.

Who would have known? page 50

Generation Shift

H2 2019 Issue NO. 19

Those who forged Poland's modern business success are retiring.

Can the next generation reach even greater heights?

PRICE: 25 PLN / 7 EUR

illustration: Erhui1979

page 18

Magazine • Portal • Conferences • Find out more at www.poland-today.pl

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CEE Summit 2019

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Investing in New Europe: cities, sectors, development & capital markets CONFERENCE, GALA DINNER and INTERNATIONAL MEDIA & INFLUENCERS TOUR 29-30 October 2019, Radisson Collection Hotel Warsaw CONFERENCE • Poland and CEE real estate in a global context • Assessing the new political landscape in Poland after the national elections • Poland and CEE – the international investors' view • Future-proofing property: wellbeing and its growing influence on commercial real estate • Revitalisation schemes - generating the return on investment • The CEE Market – unlocking the opportunities • Why Coventry University chose Wrocław for its Branch Campus • Creating a new, mixed-use human environment in the city • Global logistics & warehouse trends, e-commerce and e-exports • Responsible investment in real estate • Asian investment - what are the dynamics behind the new wave of international capital?

GALA DINNER REACHING THE SUMMIT A Gala Evening with Krzysztof Wielicki, Polish mountaineering legend and a leader of the first winter ascent of Mt. Everest (see page 94)

to book your ticket go to

theceesummit.com ORGANIZERS

PLATINUM PARTNERS

GOLD PARTNERS

GALA PARTNER

PATRONS

SPEAKERS Phil Williams Executive Vice President, Building & Human Performance, Delos

Natalie Breen Global Real Estate Legal Leader, Head of Asia Real Estate Desk, PwC

Francesco Coviello MRICS Head of Acquisitions, Italy, Spain & Central Europe, LaSalle Investment Management (Germany)

Simon Mallinson Executive Managing Director, EMEA & APAC, Real Capital Analytics

Tomasz Trzósło Managing Director CEE, JLL

Małgorzata Kosińska CEO, REIT POLSKA Association

Chan Woo Bin Associate Partner, JP Weber

Dorota Latkowska Partner, REINO Partners

Leszek Sikora Managing Director, ECE Projektmanagement Polska

Peter Noack Managing Director, Zeitgeist Asset Management (Czech Republic)

Piotr Mirowski Senior Partner, Head of Investment Services in Poland, Colliers International

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Robert Martin Founding Partner, Europa Capital (UK)

Robert Dobrzycki CEO Europe, Panattoni Europe

Justyna KedzierskaKlukowska Head of Berlin Hyp Warsaw Office, Berlin Hyp AG, (Poland)

Samuel Vetrak Founder & CEO, Bonard (Austria)

Sean Tompkins Global Chief Executive, RICS

Ingo Martin Head of International Real Estate & Structured Finance, Deutsche Hypothekenbank (Germany)

Marcin Juszczyk Board Member, CIO & CFO, Capital Park

Richard Betts Group Publisher & Co-Founder, Real Asset Media, Investment Briefings & TV

Richard Stephens Founder & Editor, Poland Today

Giving children’s hospitals a new life A wholehearted mission connects leading companies and individuals to revitalise medical infrastructure for paediatric health

K.I.D.S. (Klub Innowatorów Dziecięcych Szpitali/Innovation Club for Children's Hospitals) was launched in 2019 to support the modernisation and development of children’s hospitals. The first project is the renovation of the Children's Memorial Health Institute in Warsaw, which opened 40 years ago in memory of child victims of WWII. The Heart, a corporate centre for innovation and an initiator of the foundation, engages large companies for their know-how and financial resources, as well as start-ups for the latest technology to transform health services. Dr. Patrycja Piekutowska, a famous violin soloist and President of K.I.D.S., said, “We join forces to create a hospital of the future that will improve the comfort of treatment for young patients and the working conditions for doctors and workers in the unit.”

photo: Rubberball

More information at www.kids.org.pl

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table of contents

editorial

10

in focus

12-16 leader

18-23

Keeping it in the family

Poland is on the verge of experiencing its first generation shift in business since the return of the free market in 1989. The territory is new, the stakes are high and family politics play a role. Will the next generation step up to the challenge?

BUSINESS & ECONOMICS

24-26

Education and business in Poland: friends or foes?

The business world has largely embraced the tech revolution and the cutthroat dynamism of the 21st century, but is the education system generating the skills and talent that the new generation of business demands?

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42-44

Economists usually refrain from using words like ‘miracles’, yet something special has happened in Poland over the last 30 years.

Can the success hold?

Six companies which have left their Poland comfort zone and are exploring opportunities abroad.

From gelding to stallion

30-32

E-mobility on 46 Direct from the trading floor rapid-charge A nationwide drive has laid the foundations for e-mobility to force open a new segment in the Polish economy, but it’s a finely balanced game.

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A rendez vous with Peter Vesterbacka

Poland Today crossed paths with Peter Vesterbacka during the GreaterBayX tour in China and a chat with the tech visionary was too irresistible to turn down.

Poland Today caught up with the head of the Warsaw Stock Exchange, Marek Dietl, to talk about market trends in the region and a few innovations arising from the exchange.

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Clear skies for expansion

Celebrating 90 years of business, LOT has dug itself out of dark times and is now a leader in Europe’s air travel market.

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49

In a global market, businesses are eager to expand abroad but some deals may be lost in translation.

If the airport is the heart of the planned transport hub, the rail links will be the arteries.

Business success in translation

A rail revolution is coming

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50

The Polish Investment and Trade Agency, has undergone an unprecedented expansion, opening offices in dozens of cities across the globe.

Poland Today has put together a list of every PAIH office in the world.

In the rarified world of caviar, Poland is a bigger player than might be expected.

International reach

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New Trade Frontiers

Poland Today spoke to one of the architects behind the country’s new trade strategy: Krzysztof Senger, Executive VP of the Polish Investment and Trade Agency.

Education and business in Poland: friends or foes? page 24-26

Navigating uncharted territories

A rail revolution is coming. page 49

Black pearls bred in Warmia

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Is Poland at the vanguard of Industry 4.0

The Fourth Industrial Revolution is no longer a concept but a reality in Poland. But how are local companies negotiating the new tech frontier and what is the government doing to help?

Punching above their weight. pages 57-63

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Supplying the supply chain sector

When students score low on professional preparedness, initiatives that provide real-world experience may be the key to bridging the gap between business and academia.

EMERGING CITIES

57-63

Punching above their weight

Twelve metropolitan areas generate 55% of Poland’s GDP, according to PwC’s ‘Report on Polish Metropolises 2019’. Among the 12 are Bydgoszcz, Lublin and Rzeszów.

REAL ESTATE

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Far East capital continues consolidation in Poland

Piotr Mirowski, Senior Partner & Head of Investment Services in Poland at Colliers International, talks transactions, teaming up and trends.

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Boom on Poland’s real estate market continues The good times keep rolling for the commercial property sector, particularly in Warsaw, but there remains room for legislative improvements.

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Office rentals debunked

With the highest investment activity on the real estate market, Warsaw has been the fastest-growing prime office space location in the last six months. So what’s attracting tenants and what’s on their must-have checklist?

Here are the top five according to experts.

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A bet on Wola that’s paying off Many thought Ghelamco had over-reached when it built a big new project in an underdeveloped part of Warsaw. The decision doesn’t look so bad now.

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Short stay is the new black

There are 40 million reasons why investors should take note of Poland’s hotel industry, says InterContinental Hotel Group’s Joanna Kurowska.

INTERNATIONAL MEDIA TOUR

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88-91

Let the good times roll

At the 30th edition of MIPIM, Poland Today led the Polish conference content for the fifth year running.

SPORTS

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King of the river

After trading the Vistula River for the Thames, Polish Olympic rower Natan Węgrzycki-Szymczyk became a part of boat race history.

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Reaching the summit

Krzysztof Wielicki and Leszek Cichy were the first two climbers ever to reach the summit of Mount Everest in winter.

CULTURE

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Chałka and Vegemite

Actor-singer Jacek Koman lit his own path between cultures and arts, from Łódź to Perth, ‘Moulin Rouge’ to folk-rocker, all the way to Hollywood and back. But a close shave with the secret police might have quashed his career before it started.

IMPRESSIONS From 98 Emerging ‘Poland made me to Developed: the man I am today’ Poland Today’s 2nd International Media Tour to Warsaw

With a former professional athlete’s mindset, Walid Barsali found himself in a Polish blue ocean of opportunities which led him to co-found BallSquad, the first online sports venue booking service in the country.

A rendez vous with Peter Vesterbacka. page 34

We brought 24 international media representatives to Poland to participate in a 2-day tour to learn more about Poland’s economic success and business opportunities.

EVENT REVIEW

82-87

Co-building the Belt & Road: we need to talk about Poland and the BRI Black pearls bred in Warmia. page 50

Leaders in global transport and logistics gathered in Warsaw for the first conference of its kind to find out how relevant the Belt & Road Initiative is for Polish & CEE businesses.

Reaching the summit. page 94

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table of contents

10

editorial

‘The Polish economic model, he said, could be an example for other countries who are in difficult economic circumstances – as Poland was 30 years ago. Why, he wanted to know, does Poland not promote its success more?’

Poland Today International Sp. z o. o. ska

ul. Złota 61 lok. 100, 00–819 Warsaw, Poland mobile: +48 694922898, www.poland-today.pl

Richard Stephens

Editor’s Note

Founder & Editor, Poland Today

One of Poland Today’s main aims, since we first started in 2012, has been to bring Poland to the world and the world to Poland. It was in this spirit that we organised our second international media tour last month, inviting leading business and economic journalists from major titles around the globe to Warsaw to meet high level business leaders and politicians from both sides of the spectrum. The idea was for them to hear more about the country’s economic achievements and business opportunities. When Poland makes the news in other countries, it’s often news of a political nature. This is to some extent natural – politics understandably grabs the headlines. What we want to do, however, is to promote a better understanding of the business and economic context in which the country functions. One of the journalists asked if Poland wants to export its ‘model’.

On being asked what he meant by this, he explained that – through his country’s eyes – Poland is seen as an economic role model. The ‘Polish economic model’, he said, could be an example for other countries who are in difficult economic circumstances – as Poland was 30 years ago. Why, he wanted to know, does Poland not promote its success more? Good question. Sometimes it takes fresh eyes to see what’s right in front of you. As Poland Today consistently emphasises, the country has a great story, and it needs to get better at telling it.

On the subject of economic success, Poland’s numerous SME’s have been a major force behind this. Many are family owned, and the topic of management succession is in the air as the generation which set up the companies and established them on the marketplace passes on the reins to the next. To thrive, many will need to look for new markets abroad in a way that Polish companies have tended to avoid doing in the past. In this issue, we take a look at some companies which are facing both challenges head on.

Founder & Editor Managing Director Creative Director

Richard Stephens Sylwia Ziemacka Bartosz Stefaniak

Online Editor & Editorial Coordinator Senior Journalist

Monica Zielinski William Hastings Burke

Key Accounts Manager

Jacek Ojrzyński

Contributors

Nick Westerby Marta Janek Juliette Bretan Tetiana Shataieva Anne Galat Małgosia Krakowska Mateusz Grabiec Jacek Ojrzyński

Photographs

Getty Images, Alina Gajdamowicz Polska Agencja Fotografów Forum,

Photo output

Oleh Diakon

Printing house

ArtDruk Zakład Poligraficzny ul. Napoleona 4, 05-230 Kobyłka Poland Today Magazine is printed on Munken Print Cream ecological paper © 2019 Poland Today International reproduction without permission is prohibited

Magazine layout

Bartosz Stefaniak www.madeinPolska.eu

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nazwa działu

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in focus

Polish youth from towns and cities

around the country joined a global school protest against climate change starting on Friday 20 September. Thousands of young Poles took to the streets of around 60 cities nationwide, including Warsaw, Poznań, Zakopane, Łódź, Lublin and Kraków.

One of the organizers of the march in Warsaw, Aleksandra Czerniawska, said, "We are not satisfied with the response of politicians in Poland. However, it seems to us that the efforts that we and other climate organizations have made over the year have made a big difference in terms of awareness of the topic and the fact that it is discussed more often." The marchers’ demands included: immediate reduction of CO2 emissions, immediate transition to safe and environmentally-friendly energy sources, a fair transformation of high-carbon sectors with the provision of new jobs, and an end to the destruction of natural habitats.

The protests were inspired by 16-year-old Swedish climate activist Greta Thunberg.

Snapshot

Photo by Mateusz Wlodarczyk (Forum)

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photos: Eugeiusz Lokajski (1944.pl), Caracter Design (Getty Images)

in focus

Happy cloud computing

Love among the ruins

Google announced that it will open

Ready or not, the Fourth Industrial Revolution is here.

And it’s transforming the way we live and work. But how will this world full of IoT, robotics, virtual reality and artificial intelligence affect various industries? see page 52

The heroine of the most famous wedding photo from the Warsaw a new Google Cloud hub in Warsaw to cater to customers in the CEE. This Uprising – Alicja (Lilly) Biega – has died news comes after Google said it plans at the age of 96 in the United States. to spend $3.3bn on expanding its data “Unfortunately, we got sad news from centres in Europe. For the Warsaw across the ocean. Alicja Treutler-Biega region, which includes infrastructure ‘Kale’, a nurse from the ‘Kiliński’ battalion, like data centres, Google partnered has passed away,” posted the Warsaw Uprising Museum on social media late with Chmura Krajowa – a joint venture in September. On 13 August 1944, Alicja of the Polish Development Fund and PKO Bank Polski. It will be a Google Visa-free Poles was 21 when she married 22-year-old Bolesław (Bill) Biega, who was the Cloud reseller and build managed services using Google’s infrastructure. Poland has met the requirements commander of a platoon in the ‘Kiliński’ Google Cloud CEO Thomas Kurian said, for the USA’s Visa Waiver Program. battalion. The ceremony was held in “Poland is in a period of rapid growth, For the first time in history, the per- difficult conditions, and the newlyweds is accelerating its digital transforma- centage of tourist and business visa exchanged curtain rings instead of wedtion, and has become an international refusals to America for Polish citizens ding bands. Everyone was dressed in software engineering hub.” He added has dropped to 2.8%. To join the Visa simple clothes and there were no flowthat the partnership with DCP and the Waiver Program, the percentage of ers on the altar. “Each of us has a difnew Google Cloud region in Warsaw refusals must fall below 3%. Although ferent idea about the wedding. We had aligns with Google’s “commitment to meeting the requirements doesn’t no idea. It just happened. I remember boost Poland’s digital economy and will mean immediate visa-free travel for that my father protested. He said, ‘you make it easier for Polish companies to Poles, the process has been activated. shouldn't get married because Bill has build highly available, meaningful appli- “In a few months, we will be able to bring no job, he is still young.’ But we didn't cations for their customers.” Currently, it to an end if the data is confirmed,” care, of course,” recalled Lilly in the docGoogle Cloud operates 20 regions, stressed US President Donald Trump umentary "Epidemic of Love" shot years in September. Paweł Mucha, Deputy later. The ceremony was immortalised in including six in Europe.

Head of the Polish President’s Office, the photographs of Eugeniusz Lokajski. declared that the abolition of visas will Lilly and Bill are considered one of the come in a matter of a few months: "I most famous couples of the Warsaw think it will be much earlier than Easter, Uprising. After the war, they settled in I am optimistic here.” The Visa Waiver America. Their relationship turned out Program allows citizens to travel to the to be a long-lasting one. In August 2019, USA for tourist and business purposes the couple celebrated their 75th wedwithout a visa for up to 90 days. Today, ding anniversary.

Poles are required to obtain a B1/B2 visa for that kind of travel.

by Tetiana Shataieva

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photos: Netflix, Vincent Kessler (Reuters / Forum), Mateusz Wlodarczyk, (Forum)

in focus

Remembering where it all began

It has certainly

been a wild and colourful ride for Jacek Koman, the PolishAustralian actor and singer, ever since leaving Poland on the brink of Martial Law. But it could have come to nought had he not managed to give the secret police the flick while studying drama in Łódź. see page 96

Enter a world of enchantment

Serving up a match point

Following the success of The Witcher video game by CD Projekt, which is based on the novels by Polish author Andrzej Sapkowski, the worldrenowned legend is set to be released later this year as a Netflix TV series.

The production company presented the first trailer during the San Diego Comic-Con over the summer and according to Netflix’s Ted Sarandos, the fantasy-drama show will consist of eight episodes. The plot follows more closely the story presented in Sapkowski’s novels rather than the game, with the author hired as a cowriter and script consultant. Filming took place in Central Europe and on the Canary Islands. Set in amythical realm, The Witcher tells the story of a lonely beast hunter, Geralt of Rivia (Henry Cavill), who doesn’t fit in a world where monsters are evidently less evil than people. His life changes unexpectedly when he encounters a feisty sorceress (Freya Allan) and a young princess (Anya Chalotra) carrying a dangerous secret.

A bright young

Polish tennis star is making a mark on the international stage with her recent performances. Iga Świątek, an 18-year-old from Warsaw, has been marked as the successor of former professional tennis player Agnieszka Radwańska. The high school student already has a number of titles under her belt. In 2017, she made the finals of the Junior Australian Open before winning the Junior French Open and Junior Wimbledon in 2018.

After that, she decided to move on from junior tennis to the Women's Tennis Association (WTA) circuit and in 2019 she qualified for her first Grand Slam: the Australian Open. This year, she also competed in the Ladies Open Lugano in Switzerland where she defeated top players Vera Lapko and Kristýna Plíšková and reached her first WTA final, only to lose to Polona Hercog from Slovenia. Showing that young players shouldn’t be underestimated, Świątek competed in the French Open where she made it to the second week, becoming the second player born in the 2000s to make it that far in a Grand Slam after Amanda Anisimova’s efforts at the Australian Open. She is currently ranked 60 in the top 100 WTA players and plans to participate in the 2020 Tokyo Olympics.

Poland commemorated the 80th Anniversary of the outbreak of World War II with events throughout the country, including a main ceremony in Warsaw attended by distinguished guests, such as German Chancellor Angela Merkel, French Prime Minister Edouard Philippe and US Vice President Mike Pence. On the Baltic Coast, Polish and international leaders attended a symbolic cornerstone laying ceremony to mark the start of construction of the Museum of Westerplatte and the War of 1939. This open-air museum will be a part of the already existing Museum of the Second World in Gdańsk and will be located on the Westerplatte peninsula where the first battle in Germany’s invasion of Poland took place, sparking the outbreak of WWII in Europe.

The Battle of Westerplatte began on September 1, 1939, when a German battleship opened fire on the Polish Military Transit Depot. The Polish crew managed to fight for seven days before surrendering to the Germans.

by Monica Zielinski

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18 LEADER

Keeping it in the family

Poland is on the verge of experiencing its first generation shift in business since the return of the free market in 1989. The territory is new, the stakes are high and family politics play a role. Will the next generation step up to the challenge?

A legend has been circulating around

William Burke is

an Australian writer based in Warsaw. In 2010, he brought the WWII-rescue story of Albert Göring to the world in his book Thirty Four and the BBC documentary ‘Goering’s Last Secret.'

He has studied in the US and Australia, ultimately obtaining an Honours degree in Economics (Soc. Sc.) from the University of Sydney. He has lived in Poland since 2014, researching and writing, among other projects, his second WWII epic.

the business world in Poland. It involves a family company, a near tragedy and some quick thinking by the new guard. The mid-sized logistics company, as the story goes, was rocked when its founder and family patriarch suffered a heart attack. The reins to the business landed in the hands of his millennial son. By the time the father had made a full recovery, he nearly had another heart attack after seeing that his son had implemented a series of big changes… for the better. He had streamlined operations and future-proofed the company with the introduction of new technology. By all reports, both the company and the father’s heart are now ticking along nicely. Welcome to the world of family business and succession in Poland. Over the following pages, other examples of succession will be explored: family businesses from varying regions and industries, from manufacturing and construction to confectionary and venture capital.

Similar to Germany’s ‘Mittelstand’ companies, these businesses have formed the bedrock of the country’s economic success story. The most conservative estimates suggest that more than a third of all private enterprises are self-declared family businesses, contributing around 18% of GDP. But it is a relatively new phenomenon since the market economy was reinstated just 30 years ago. In fact, it could be argued that it has been 80 years since the country has seen such a generational transfer of private capital, management and know-how, let alone one arriving so acutely at such a large scale.

“Succession in Poland is a huge challenge,” said Adrianna Lewandowska PhD, President of the Family Business Institute, Poland (Instytutu Biznesu Rodzinnego: IBR). “But it is worth taking it because as much as 183bn zł of Polish GDP in the next five years is dependent on its success.”

Hard act to follow Unlike other socialist states, a small level of private enterprise was prevalent in the Polish People’s Republic through cottage industries and private landholdings called ‘kulak farms’, not to mention a thriving black market. According to the economist Prof. Aleksander Surdej, there were around 600,000 private enterprises in 1988 and after a process of rapid liberalisation, the figure had jumped above two million by the end of 1990. These free-market pioneers navigated the economy to EU accession in 2004, persevered through the 2008 financial crisis and rode the boom of the last ten years to become a growth champion of Europe.

It was a modern-day economic miracle and one propped up by a backbone of family businesses.

Mapping the exact size of this economic spine, however, has proven to be a difficult exercise. It is all a matter of definition, methodology and self-determination. A 2016 report

from the Family Business Institute (IBR) looked at multiple definitions and scenarios. The first definition is based on ownership where a family business is considered as such when a family member (founder, spouse or child) possesses a majority stake in the business. On this basis, the survey found that 92% (2.1m) of the country’s private enterprises could be considered family businesses, contributing approximately 67% to total GDP. But the plot thickens when the definition is determined by business owners themselves. In the IBR study, a mere 36% of Polish respondents perceived their enterprise as a family business, which would equate to only 18% of GDP. A 2018 survey from Statistics Poland (Główny Urząd Statystyczny: GUS) recorded a similar result with 33.9% making the declaration. Interestingly, Dr Lewandowska pointed out that 75% of business owners in Western Europe embrace the title of family business. She believes there are many reasons for Poland’s reticence in this regard. Without a long tradition like in Germany, family businesses in Poland are often perceived as unprofessionally managed and as a result, many owners prefer to distance themselves from the label.

On face value, this statistical discrepancy could be dismissed as semantics, but the IBR study cautions that the ramifications of the resulting perception gap may be manifold, especially in terms of how the segment is received by policymakers. First of all, any government would be naturally more responsive to a voting block backed by 92% of businesses than 36%. But more importantly, the report shows that companies comfortable with their family identity are more likely to implement a professional succession plan, bringing transparency and order to the process.

Whether family businesses are prepared or not, a generation shift is on its way thanks to changing demographics.

Poland’s population pyramid looks no different to the hourglass figure that depicts the age distribution of other OECD countries. The retiring 60-and-over cohort (baby boomers) is growing faster than the working population (15-to-59).

A 2015 McKinsey report projects that the old-age dependency ratio between the retired and working population will grow to 30% by 2025, representing a 10% jump on 2012 figures. Like its fellow OECD members, the Polish government has begun to introduce measures to address this impending labour and skills crisis through family planning and immigration policy. For example, this year the country became the EU’s largest issuer of work permits to non-EU workers.

Less attention has perhaps gone to the fact that business owners – and family business owners, at that – are also growing older. The time has come for the country to experience its first major ownership transfer since the outbreak of WWII. “Poland is one of the biggest countries in

the European Union with a majority of businesses still in the to offer courses and workshops on management succession first generation of owners,” said Dr Lewandowska. A 2009 for owners and successors in tandem. The government has study from the Polish Agency for Enterprise Development begun to offer grants and training programmes to facilitate (Polska Agencja Rozwoju Przedsiębiorczości: PARP) found the succession process. In other areas, the government has that 75% of enterprises were held by first-generation own- taken a more active role. For example, two months after the ers. The IBR’s more recent data showed that 14% of busi- sale of Solaris, the Polish Development Fund (Polski Fundusz nesses had already gone through succession, 19% were in Rozwoju) secured a 35% share in the company after deemthe process and 57% were planning to enter succession over ing it a vital national asset. the next five years. The study calculates that this last segThere is also promise in the government’s pivot to a knowlment contributes an estimated 180bn zł in value-add to the edge-based economy. It might not be a question of sucoverall economy. What is most alarming, over 50% of owners cession but redirection where the capital amassed by the claimed that they don’t talk about succession, while only 8% first generation from largely the heavy industries could be of successors conveyed an interest in taking over the fam- transferred into ICT startups by the next tech-savvy genily business. “The main problem is that most owners are not eration. “The younger generation is completely different,” fully aware that succession is a long-term process,” explained said Jadwiga Emilewicz, Minister of Entrepreneurship and Dr Lewandowska. “It is not just a transfer of company own- Technology. “They don't have a complex and they are open. ership but a whole preparation of the successor, market, They know their value… They are really hungry and they can employees, family, partners and for the owners themselves.” run faster than their western counterparts – and they are It should be remembered that the transfer of private capi- aware of that.” It would appear that the business community tal and management occurs every day around the world, has begun to answer the government’s call. According to just as it did in Poland before WWII. But due to the fact that the Eurostat-OECD Entrepreneurship Indicator Programme, around 1.4 million businesses were created within a two- the country registered the EU’s 6th highest business birth year time period (1988-1990), the transition in Poland will rate in 2016, but it is ranked down the bottom when it comes likely come in a surge through a narto survival rates. Only 51.99% of busirow window. There are many ways nesses made it to their third year in 2016 how this story can play out. Going by and 39.31% to their fifth year, although international precedent, 30% of famthe figures rose slightly in 2017. This ily business will likely be transferred has conspired to give the country the into the hands of the next generation, 6th highest startup churn rate (ratio many of which may well go on to write between birth and dissolution rates). new successful chapters, as shown by Jacek Ratajczak and Maciej Halbryt, the case studies featured in this magafounders of the thinktank PLUGin - the zine. In other cases, the transfer may Polish Innovation Diaspora, suggest that gaps in the education system be less successful. The path of bringing in outside management and setting might be the problem. “Why is Poland currently one of the hottest places on up a family executive board may prove the planet for software development?” to be more difficult in Poland. This is due to particularly low levels of trust family businesses posited Halbryt. “Because we have towards external parties and the legal at a glance great smart engineers. The level of eduframework in the country. “The Polish – 36% of Polish firms identify their cation here is superior to many Western legal system is specific,” added Dr business as a family-owned (18% of GDP). countries. What we lack, is educating Lewandowska, “and does not allow – 5% of Polish firms are people to be independent thinkers, multigenerational family businesses. for the establishment of family trusts, challengers of the status quo, and not – 29% of family owned businesses which is a popular business solution in afraid of failure. The ‘you can do it’ menare at least 20 years old. countries like the Netherlands, Austria – 19% of family owned businesses tality is not very common.” Ratajczak are on the threshold of succession. and Luxembourg.” Given these legal sums it up eloquently. “In the startup restrictions and the current trajectory world, there’s a saying: for a startup one of the market, the larger family companeeds a hacker, a hustler and a hipster. nies with an international scope might be tempted to cash We have an overload of hackers but too few hustlers.”

There is already evidence, however, that part of this gap in their chips while at the peak of their business cycles. Take the recent case of Delphia Yachts founded by the Kot broth- may be filled by a ‘reverse brain drain’. More young Poles ers in the Masurian Lake District. After spending the last are returning to the local market armed with international 30 years building their company into one of the region’s experience, knowhow and confidence. PLUGin’s 2019 surlargest producers of watercraft, the brothers decided last vey ‘e-Migrants’ found that 48.8% of Polish expats are thinkNovember to sell an 80% stake to the legendary French ing about returning home. “The startup world is fuelled yacht builder, Beneteau. Similarly, the Olszewski family, the by people with international experience,” said Ratajczak. founders of the public transport vehicle producer Solaris, “Startup Poland’s report on Polish startups indicated that sold their company to the Spain-listed Construcciones 50% of all Polish startup founders have experience of livy Auxiliar de Ferrocarriles in 2018. ing and working abroad.” Halbryt agreed by adding: “We also know of a few cases of entire startup teams being Succession or redirection? moved from abroad to Poland. One such case is a now There are signs that the country has woken up to the sheer London- and Warsaw-based tech startup G1ANT. The foundpower of family businesses and the significance of a seam- ers met in London, did some hiring at our PLUGin London less transition. “When I was preparing for my PhD,” said meetups and decided to move the business, especially Dr Lewandowska. “[My professor] told me that I should do tech development, back to Poland.” something more serious because family business is a silly The Polish economy's future hangs in the balance, but area of research. It was over 15 years ago. Now things have an old adage may provide clues: the first generation makes changed…I think nowadays family businesses are treated the money, the second spends it and the third squanders it. with much more respect. It is because they carry the majority If there is any truth to it, the country doesn’t need to worry of Poland’s tax burden and provide employment.” Along with for at least another generation, for the current wave of busithe IBR’s own ‘Successor Academy’, universities have begun nesses has just hit the investment phase. by William Burke

19 LEADER

illustration: Erhui1979

‘The problem is that most owners are not fully aware that succession is a long-term process’

Dr Adrianna Lewandowska

holds an MBA from the Europäische Wirtschaftsfachschule Berlin (19982000) and a PhD from the Poznań University of Economics (2000-2004).

In 2011, she founded the Family Business Institute in Poznań, a research centre and knowledge bank supporting family businesses in the field of development strategy, succession processes and change management. She has published various books and conference papers on the topic.

20 Leader

Mokate: brewed over 100 years of succession If ‘coffee is for pleasure and tea is for health’, what does it mean to be a family-owned beverage producer? Adam Mokrysz, CEO of Mokate Group, lets us in on the secret.

Adam Mokrysz

is the fourth generation family member at Mokate. Before becoming CEO, he was a board member and was responsible for the international development of the company.

Mokate is now a brand name, but where does it stem from?

The history of Mokate dates back to 1900 when Józef Mokrysz opened a colonial shop in a town located in what is now the Czech Republic.

After opening a concrete batching plant, the family business continued to expand for the next three generations. In 1990, the owner’s grandson, Kazimierz Mokrysz, took over with his wife Teresa and they changed the company’s name from Mokrysz to Mokate by incorporating both of their names - MOkrysz-KAzimierz-TEresa.

illustration: Erhui1979, photos: RomoloTavani, Mokate

How has the company evolved over time?

Mokate The Mokate Group produces and exports brands of coffee, tea, cocoa, chocolate drinks, creamers and other instant beverages. Originally from Silesia, the company is one of the largest producers of instant coffee and tea in Poland, the Czech Republic, Slovakia and Hungary. Mokate created a fully integrated group of 9 companies and products are exported to 73 countries around the world.

Mokate has existed for nearly 100 years, but the company had a major breakthrough in the 1990s when we found an opportunity to capitalise on the unmet needs of the market. This was a period of investment and development which resulted in the creation of new products, such as instant cappuccino. In the 2000s, the company opened new production plants and through organic growth, it accumulated the capital to make seven acquisitions in Poland and the region.

Mokate soon became an international group of nine companies operating in the CEE and select non-European markets. However, we have not lost our family character despite growth in sales, revenue and overall development as a dynamic company.

How many generations work at Mokate?

As the CEO, I am a successor in the fourth generation of our entrepreneurial family company. I believe that every generation has made a great contribution to our business, and my contribution is the creation of its international

DNA. In addition to my parents and myself, my wife Katarzyna also works in the company as the General Manager of the plant in Żory.

What’s it like running a large family-owned business?

It’s a great honour but also a big responsibility. It’s a challenging professional adventure that requires constant creativity and total commitment.

In a company run by one family from the beginning, the same values and code of conduct are passed down from generation to generation. This shapes interpersonal relationships and organisational culture. People are very important to us and we focus on building a good atmosphere at work and creating well-coordinated, committed and professional teams that will help us develop and grow.

Who will take over the company in the future?

The Mokate Group is to remain a family business in the future. Successful succession is a great challenge, but we know how to prepare for it and how to carry it out effectively. From a young age, we help future successors make decisions, although each member of our family chooses their life and career path according to their predispositions.

What are your thoughts on Millennials? Are they prepared to enter the workforce?

I don’t like to generalise. I do believe that the key to readiness is emotional and business maturity which comes from relevant experience. Personality is also very important. I’m happy to see that many young people not only learn and work hard for success but are also passionate visionaries. Such people will definitely be ready to lead companies and develop them further. The generation they belong to is less important because each generation has something to offer.

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Oknoplast: an empire built on close family bonds and PVC

leader

Every Pole deserves a good window, according to the founder of Oknoplast.

His son and CEO, Mikołaj Placek, provides a look inside the operations of the PVC window and door manufacturer, along with a lesson in succession planning.

Polish products. Foreign window dealers were afraid that windows and doors made in Poland were of low quality. This experience taught us how to be better prepared to enter new markets. When we expanded into Italy and France, we conducted thorough research to help us tailor the way we operate in those countries.

This multinational company manufac-

tures PVC windows, window components, doors, aluminium products and roller shutters.

Oknoplast is still headquartered near Kraków where it was founded but has since expanded to 13 countries and opened nearly 3,000 showrooms. This September, the company celebrated its 25th anniversary.

What can you share about working in a family business?

One of the reasons for the success and stability of the Oknoplast Our history began in 1994 when Group today was our well-organised Polish capitalism and entrepreneurship and successful succession process. was just emerging. At the time, peo- This is a complex process that many ple in the country had wooden win- family businesses face, not always with dows which were not technologically positive results. We managed to make advanced and did not provide secure changes efficiently, but they were preroom protection. While my father, ceded by years of preparation. During Adam Placek, walked the streets of my career at the company, I worked in Kraków, he looked at the tenants’ win- production, the warehouse, administradows in terrible condition and said tion, finance, construction, and other that Poles deserve better. He decided departments. When I took over, I had that Poles should have windows like in a lot of knowledge and experience that Western Europe – made of PVC. That’s enabled me to effectively manage the how Oknoplast was born. organisation. In addition to the challenges, a family business is, above all, How did the company a philosophy. People are our strength develop over the years? and we all support one another and We started as a small family business act together. This open, collaborative with 26 people but developed quickly approach gives us very good results.

– and I personally developed with the company. After I gained experience in Where do you see your various departments, I formally took over company in 5, 10 years? management in 2008. When Poland Certainly as the Oknoplast Group, we joined the EU, we expanded into foreign plan to develop all the time, both with markets and today we have a strong our products and in geographic reach. position in 13 foreign markets. Over our This means increasing production and 25 years of activity, we have introduced revenue, but also bringing more innoover 50 innovationsto the market. vative ideas to life. In the coming years, smart solutions will undoubtedly be What challenges did you face important to us and they will probably in the beginning and how become the technology of the future. did you negotiate them?

Even now, we just introduced a new There were various challenges from product called Intelligent Window, the very beginning. For example, we which also acts as a tablet. However, needed to acquire know-how, hire I am convinced that products and proexperienced employees and secure jects of this type are just the beginning a machine park – something that was of the revolution and we want to disnot available after the transformation. cover new and innovative products.

Then we needed to build customer awareness. It was also difficult to sell products to our neighbours because Germans are very loyal to local products produced for generations and patriotism is exceptionally strong there.

Another obstacle was the perception of

Adam Placek (left)

founded Oknoplast in 1994 and turned it into one of the largest manufacturers of PVC windows in Europe. His son, Mikołaj Placek (right) took over the company as CEO in 2008.

illustration: Erhui1979, photos: Oknoplast

Where did the idea to produce windows come from?

oknoplast

22 leader

Kross: riding high Running a large family company is a 24/7/365 challenge where the boundaries between work and home blur, which makes it all the more rewarding. So says Kacper Sosnowski, Member of the Board and son of the founder of Kross, the largest bicycle manufacturer in Poland.

sons, daughters, wives and husbands – and probably the third generation will soon be knocking on our doors. Family is very important for us. However, there is a downside: it means being at work all the time, if not physically, then mentally because you’re thinking about the company all the time. You can’t separate your private life from your professional one.

Kacper Sosnowski has been at the

illustration: Erhui1979, photos: Kross

company since 2012 and he is responsible for creating and developing the LeGrand brand.

Kross is celebrating its 30th anniversary next year – how was the company founded?

Who do you think will run the company in the future?

We’re cautious about the process of succession and intergenerational change. The company should be managed by the best-prepared person.

From today's perspective, it may be me or it may be an external manager. We care about the future development of Kross and, as owners, the family should look for a solution that ensures the fastest development.

In 1990, my father, Zbigniew Sosnowski, had to decide what to do with his life and career. He was a 22-year-old car mechanic and wondered if repairing cars was his dream job. To be honest, it wasn’t. He observed that the Polish economy was changing, and he was eager to start a business. Before deciding how to invest his money, he considered cooperation Are Millennials prepared with three Polish companies: Żywiec – to lead the next generation the meat company, not the beer pro- of business in Poland? ducer – Wedel the sweets producer and I am from Generation Y, while my bicycle maker Romet. But only Romet father is a Baby Boomer. I know that we answered the phone and agreed to sell are different because we were born and my father 30 bicycles. In fact, Romet raised in totally different environments. would later become our biggest com- Millennials are going to rule the world petitor. At first, we operated like a bicy- no matter whether we want it or not. cle shop and then as a wholesaler. After This generation is educated and keen becoming the biggest bike distributor on technology. They speak many lanin Poland, my father decided to start guages and like to travel and discover producing them as a subcontractor. In the world. Millennials are hardworking 2004, we developed our own brand and passionate about what they do.

– Kross. Thanks to hard work, passion I can see it in the company, where we and a bit of luck, Kross is now the big- have many avid cyclists and they do gest bicycle brand in Poland. what they love. Can you believe they cycle to work 30, 40 or even 100km by bicycle? During the weekend they take What does it mean part in bicycle competitions and spend to be a family company?

Since my father established this their holidays on bikes, too! company, two generations of our family have worked here. It was always my father’s plan to find a successor and as luck would have it, my brother Maciej and I were always eager to work at his KROSS companies. We spent a lot of time here, The company’s portfolio includes three helping as teenagers during Saturday brands: Kross, Le Grand and Multicycle. Kross shifts, working as assistants during is well-known for sports and recreational bicyour studies and now working in the cles, Le Grand is a brand of classic city bikes and Multicycle is a Dutch brand that the company companies he built. Our company is took over in 2017 which specialises in e-bikes. the biggest employer in the town of Przasnysz (110km north of Warsaw), meaning our employees are also often related to each other. We have mothers,

TDJ Investments: going long on traditional values For TDJ, success starts with investment, development and acquisition, but family always comes first. Today, the Katowice-based business is one of the leading investment companies in the CEE.

tdj investments TDJ is a family owned investment company

illustration: Erhui1979, photos: TDI, Kirill Smyslov

which is active in many sectors of the economy.

One aspect of the company invests in shares of mature companies as a strategic shareholder, while another focuses on investing in innovative, technological startups with the potential for global development. In addition, TDJ has a branch dedicated to real estate investments as well as one for educational programmes and scholarships.

23 leader

an example of how a Polish business can stay ahead of trends even though the share of private companies in the creation of Polish GDP is still lower than in other developed companies.

We want to change this in the coming years with our partners.

What is your perception of Millennials in terms of business?

TDJ is built on the work of different generations. We draw on the experiTDJ is a family-owned investment ence and wisdom of our elders but at company. How did it start? the same time, we use the openness Our story dates back to 1977 when and fresh ideas of the younger part the founders, brothers Jacek and Michał of the team. Based on our experience, Domogała, started a business cultivat- Millennials are people who have studing asparagus and cloves. They moved ied at foreign universities but decided from the horticultural sector and pur- to return to Poland to build a career sued other ventures. Jacek followed path here. They are highly educated his instincts and invested in everything and possess all the predispositions to from a car metal pressing plant, a foot- succeed. Poland is no longer a country wear factory and even the production made up of cheap labour or dependof ready meals. He spent the 90s deal- ent on the know-how transferred from ing with investments, creating new the West. Young Poles are some of the companies, developing business ven- most active and successful startup tures and purchasing other companies. entrepreneurs worldwide, and for new In 2010, his son, Tomasz took over the Polish ventures, the world is their oyster. reins and began transforming our com- They dare to conquer the world at full pany into a family business that invests speed and without any complexes. in various types of assets. TDJ has five companies listed on the Warsaw What is your family’s Stock Exchange and since 2018, we philosophy in business? have created a new business strategy Relationships, closeness and trust which includes five defined investment are important in every family. And we areas: Equity, Venture, Estate, Finance would also add that the most important and Foundation. thing for an entrepreneur is passion – you have to love what you do, want to grow and work hard.

What is your aim as a company?

We are committed to being the preferred investor and creating significant added value for our partners. People are at the foundation of TDJ's activities and we understand the needs of Polish entrepreneurs because we often share similar experiences. We believe in the efficiency of private capital and we’re

For over 40 years, TDJ

has been investing in various enterprises.

It has managed nearly $1bn worth of assets and employs over 7,000 people in its portfolio companies.

BUSINESS & ECONOMICS

Education and business in Poland: friends or foes?

The business world has largely embraced the tech revolution and the cutthroat dynamism of the 21st century, but is the education system generating the skills and talent that the new generation of business demands?

American author

Marta Janek

is a University of Warsaw and London School of Economics graduate, currently based in London.

With a passion for media and gender studies, she works as a media analyst and plans to do a PhD in the future. Marta has been involved in organising LSE Polish Economic Forum 2019, the biggest conference about Poland happening abroad.

She writes about education, feminism and all things Polish.

Amanda Ripley raised eyebrows when she included Poland in her 2013 New York Times bestseller, ‘The Smartest Kids in the World: And How They Got That Way’.

“Poland, the punch line for so many jokes around the world, ranked thirteenth in reading and eighteenth in math, just above the United States in both subjects,” she wrote. “In the space of three years, Poland had caught up with the developed world. How could this be?”

Since 2006, Poland has been performing remarkably well in international standardised educational tests, ranking above the OECD average in reading, science and mathematics. This puts the country in competition with countries such as Finland, South Korea, Germany and Canada. While these achievements are extraordinary, there is another side to this story. Young people, educated and raised by schools to function efficiently first and foremost as individuals, are largely unprepared for what the business world has in store for them.

Rapidly developing technology, the pursuit of better communication, and access to knowledge all call for systematic changes. The business world caught on pretty quickly, but what about the education system? Are the country’s ‘knowledge factories’ producing graduates well-equipped for the challenges of the modern world?

The pros and cons of tech The rise of algorithms, robotics and innovative technology all at first fascinated the world, but soon it became obvious that we needed to start asking questions about whether it all went too far. A report by McKinsey from 2017 titled ‘A future that works: automation, employment, and productivity’ found that 5% of existing occupations could function entirely without human’s contribution, while 60% of all occupations contain at least 30% technically automatable activities. Automation improves the speed and quality of performed tasks and, as per McKinsey’s estimation, it can raise productivity growth globally by 0.8-1.4% annually. It is then quite logical to assume that employers would take advantage of the opportunities that automation gives them and start implementing more and more technologically driven solutions.

national Class system The school system in Poland consisted of three tiers until 2017: primary school for kids ages 6-12 (6 classes), lower secondary school for teenagers ages 13-16 (3 classes), and high school/technical school/trade school for young adults ages 16-19 (3 or 4 classes, depending on the type of school).

In 2018, the lower secondary school system (gimnazjum) was cancelled, primary school was extended to 8 classes, and high school – to 4 classes. The school year 2019/2020 will be the first one after the reform, with so-called “double class” – last year of those teenagers who finished secondary school, and first year of those who finished the new, extended primary school. They all need to find a place in the first year of high school or another type of upper secondary education.

But what will this mean for an average employee? “Employees, whose jobs are being replaced by technology, are faced with the necessity of retraining and gaining new skills. The importance of occupations and tasks that require technical skills based on technological development is increasing, which brings changes to the market’s structure,” said Marcelina Godlewska, Managing Director at the Association of Business Service Leaders (ABSL).

A report published by ABSL this year found that the majority of the analysed companies (70%) had introduced various solutions requiring intelligent automation and were currently testing them.

Although 30% of these companies had not yet implemented the changes, they conveyed that they planned to do so in the future. Godlewska added that this rising demand for specialised skills has influenced the structure of the job market. “This brings opportunity for higher salaries, but on the other hand, there is a need to act against technological unemployment. That task requires changes in the education system on all levels”.

This begs the question as to what actions the education system needs to pursue in order to meet these challenges? According to Jakub Gontarek from the Department of Skills and Competencies at the Lewiatan Confederation, people are currently educated rather than taught. “Students should be taught how to learn, not only take for granted theories that are imposed on them. It is key to develop the need for constantly growing and learning – either formally through courses, training, coaching programmes or informally by fun activities or games.” Rafał Flis, co-founder of ‘Zwolnieni z Teorii’ (‘Unshackled from Theory’), agrees. “The whole of Europe has the same disease – students are told to learn everything by heart, and while there is nothing wrong with knowing the basics of biology, chemistry and so on, school should be more than that,” said Flis, whose institution provides an educational platform for young people to design their own social projects.

Faced with these problems, the Ministry of Education (Ministerstwo Edukacji Narodowej – MEN) claims to have prepared solutions which will

photos: AndresR. (Getty Images)

24

allow young people to gain skills and competencies necessary for functioning efficiently in the dynamically changing reality of the 21st century.

These solutions involve introducing the basics of coding, algorithmics and the topic of artificial intelligence (AI) to the core curriculum through the subject of “Information Technology” (IT). This all sounds very well, but there are some doubts about the real effect of these changes. One IT teacher from a primary school in Kraków interviewed for this piece revealed that there are possibilities for teachers to enlarge their knowledge by attending free courses and workshops, organised both online and offline. However, she underlined that before the change in the school programme, algorithmics was already part of the school curriculum and from her experience, it was often too difficult for children to understand. Those who wished to know more could do so during extra-curricular classes run by teachers after school. “Only last year, the occupation of computer programmer (technik programista) had been introduced in Polish technical schools,” said Gontarek. “There is still a strong notion in Poland that technical subjects should be taught at technical universities (politechnika) – but the reality is that business, and especially the production side of it, suffers from the lack of mid-level employees.”

The education system, however, must be doing something right in this field, as Jadwiga Emilewicz, Minister of Entrepreneurship and Technology, points out. “Today Polish programmers are recognised as the best in Europe and the third in the world after China and Russia,” she said. “In the two most popular coding languages, Java and Python, Polish programmers are ranked first and second.”

government spending on tertiary education (% of gdp)

UK: 0.3% Italy: 0.3% Luxembourg: 0.5% Ireland: 0.5% Czechia: 0.6% France: 0.6% Romania: 0.6% Social skills to the rescue Slovakia: 0.6% Faced with the rise of technology, the Spain: 0.6% education system has another chal- Austria: 0.7% lenge to overcome: the task of helping Bulgaria: 0.7% young people develop skills that will Lithuania: 0.7% not be replaced by AI (or at least not Germany: 0.8% yet). As Gontarek said: “Skills such as Greece: 0.8% leadership, teamwork, emotional intelli- Latvia: 0.8% gence and willingness to learn and grow Belgium: 0.9% as a person are necessary to work with Hungary: 0.9% others, no matter the job title. The ins Malta: 0.9% and outs of the job can be easily taught Portugal: 0.9% and verified, and then the company can Croatia: 1.0% decide whether the employee is worth Slovenia: 1.0% investing in. But the social skills – or lack Estonia: 1.1% thereof – will come to light sooner or Sweden: 1.1% later.” The value of social skills that Cyprus: 1.2% take longer time to develop seems to Poland: 1.2% be understood by both the government Netherlands: 1.4% and the business sector. It is an issue that Denmark: 1.6% Emilewicz knows all so well. After labour Finland: 1.8% shortage issues, she said that the deficit of soft skills in the Polish workforce

source: Eurostat (2017)

is the second biggest complaint that businesses bring up with her. Similarly, MEN and the Ministry of Science and Higher Education (Ministerstwo Nauki i Szkolnictwa Wyższego – MNiSW) see gaining skills such as independent and analytical thinking, entrepreneurship, effective communication and creativity as an important part of education on all levels. Moreover, except for the “regulated occupations” such as law and medicine, since 2011 there is no longer a setlist defining what a particular university degree should look like. This means that universities can customise their programmes to the needs of the fast-changing labour market – although MNiSW still maintains that “it is not the role of the university to educate people for a specific occupation.” After a quick look at the University of Warsaw’s new degree programme for the academic year 2019/2020, it’s clear that the institution has taken a step in that direction through the addition of degrees like medical chemistry, cognitive science and computational engineering.

Similarly, Jagiellonian University in Kraków has this year introduced courses such as Eurasian studies, environmental protection, and management.

However, these changes do not seem to solve another problem of the Polish education system, which Flis sees as the highly individualistic approach to learning. “Everything is focused on independent work, which results in young people not being prepared for working in a team. I have heard many stories about absolutely brilliant people, educated in Poland, who moved to Silicon Valley only to be brutally confronted with their own egos. They had to learn how to work with other people, how to ask for help,” he said. Asztalos admits that teachers try to implement new methods in order to break the individualistic pattern, but these are not always effective. “Studies show that echoic memory is the lowest one for young people,” she said. “They often don’t listen to the teacher, and even if they do, they can’t memorise it; as soon as the information is learned it is soon forgotten. That’s why we try to back out from traditional lecture-style classes and do something else – for example, use interactive whiteboards if there is money for them or work in groups. But pupils tend to work less effectively that way. There is often one leader that does all of the work and a few people who do nothing – and then it is hard to fairly mark their work.”

The business sector also sees interpersonal and analytical skills as necessary. “Skills such as the ability to solve problems, data analysis, maintaining interpersonal relations, communications and creativity are becoming more and more important when faced with

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BUSINESS & ECONOMICS

Seven out of ten

tertiary-educated adults have a master’s degree in Poland compared to three in ten on average across OECD countries.

However, their relative earnings compared to a bachelor’s degree are lower than in most countries.

BUSINESS & ECONOMICS

The broad fields

of engineering, manufacturing and construction; information and communication technologies; and health and welfare offer the highest employment rates in Poland (more than 90%) while employment rates are lowest for those who studied arts and humanities (OECD).

the evolution of the labour market,” said Godlewska. Wojciech Fedorowicz, managing partner at TDJ Pitango Ventures seems to agree: “The three most important qualities of a new entrepreneur would be, firstly, openness for learning, receiving and giving feedback.

Secondly, the ability to learn from one’s mistakes, willingness to come back from a dead-end path – this means you have to be brave enough to make mistakes while building something new.

And lastly, an often undervalued quality, namely persistence. While building a start-up, you need to put in a lot of effort, but the day-to-day duties usually do not bring spectacular results.”

Interestingly, according to the Ministry of Entrepreneurship and Technology (Ministerstwo Przedsiębiorczości i Technologii – MPiT), 72% of startup owners are over 30, 15% over 40 and only a small group is in their 20s.

It seems that young Poles need some encouragement to start their own businesses. Initiatives such as ‘Start in Poland’, the biggest programme for start-ups in Central and Eastern Europe, might be a good start.

The bigger picture Poland is definitely not alone with its struggles to effectively link education and the labour market. A rather alarming 2014 report by McKinsey shows that a total of 7.5 million young people in Europe are neither in education nor in employment, and more than half of those who are not working claim that they just can’t find a job. One of the reasons is a big discrepancy between the skills needed by employers and those that young people actually possess. However, the report does not include Eastern European countries, and claims its history and economy to be “distinctive”.

According to Eurostat data, the youth employment rates (people aged 15-24) in Poland, Czechia, Hungary and Slovakia are lower than the EU’s average. Poland has one of the highest employment rates of people with higher education among EU countries – for people aged 25-74 it is 88.1%. However, it does not mean that young people are better prepared for the labour market, because people with university degrees in this age group only represent 30% of

hands-on education In August, Poland took a positive step towards bridging the demand-supply skills gap by launching its first P-TECH programme, an international public-private initiative designed to prepare high school students to enter tertiary education and ultimately, employment in the field of ICT. Backed by IBM, Samsung and Fujitsu Technology, this programme was rolled out into three technical high schools in the Katowice area. Alongside their other subjects, students will receive hands-on education in computer science or mechatronics over a five-year diploma, which also includes mentoring and paid internships in participating organisations. The programme is set to be deployed in other areas around Poland.

the Polish population. When looking at employment rates for those with upper secondary education, Poland notes one of the lowest scores in EU at 69.6%. This data clearly shows that attending a university in the country is the safest way to land a job and trade schools are still considered mediocre at best and useless at worst. Those who choose not to attend university might just not be that lucky with finding a job.

Interestingly, Central and Eastern European countries differ in their approach to reforming the education system. Both Czechia and Hungary have followed the English model and introduced tuition fees for their university courses, while in Poland and Slovakia higher education is free for EU citizens.

Among these four countries, Poland also has the highest rate of access to higher education, with approximately 470 institutions, although the number is expected to decrease because of the recent reform by MNiSW. When looking at governmental expenditures for higher education in correlation with GDP, Poland spent 1.2% of its GDP on tertiary education in 2017, with only two other EU countries spending more than that – Finland (1.8%) and the Netherlands (1.4%). However, the overall percentage of education spending (4.9%) falls just above the EU average (4.6%), with 12 other countries enjoying a higher rate.

This data proves that the country has the capacity to become an educational leader in the CEE. However, in terms of preparing the students for the challenges of the business world, there is still a lot to be done. As Gontarek said: “Well-defined education systems such as that in Hong Kong respond to the question: what kind of employees do we want? The education system has to meet the needs of the labour market and currently, all the actions are implemented ad hoc, rather than in a holistic, systematic way.” Fortunately, from a business perspective, the situation today is better than it was a few years ago. “If we look at what we had 10 years ago, the progress is enormous,” said Fedorowicz. “There are people and companies that come up with ambitious projects that are not merely a copy of Western businesses. Entrepreneurs are fully engaged, but they often lack the second key element – experience.

But the new generation of serial entrepreneurs is coming. It’s just a matter of time and the pace in which business markets will develop.” There is hope for changes in the education system as well. ‘Zwolnieni z Teorii’ has bigger plans. “We’re planning something that will change the way in which we think about education in Poland,” Flis said, holding his cards to his chest. “It’s only a matter of months.” by Marta Janek

photos: AndresR. (Getty Images)

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‘The education system has to meet the needs of the labour market, and currently, all the actions are implemented ad hoc, rather than in a holistic, systemic way’

27

photos: Alina Gajdamowicz (Bind Up Photos), Bartosz Stefaniak

In 1989 Poland emerged

Prof. Grzegorz W. Kołodko is the

world’s most quoted Polish economist. He is an intellectual and politician, and a key architect of Polish economic reforms. He was the Deputy Prime Minister and Minister of Finance from 1994 to 1997 and from 2002 to 2003. He is a Member of the European Academy of Arts, Sciences and Humanities, and Founder and Director of Transformation, Integration and Globalization Economic Research (TIGER) at Kozminski University. .

from During the uncertain transition over 40 years of communism as an years in the early 1990s, a popular joke economic basket case. Fast forward circulated around Warsaw: you can to 2019 and the country has recorded make a gelding out of a stallion but 27 years of continuous economic not the other way around. That was growth and was last year promoted ultimately the assumption that my colby FTSE Russell to Developed Market leagues in government, peers in acastatus, joining an exclusive group of demia and I were ultimately charged 25 major economies. Poland’s success to test, if not disprove. Could we turn was no foregone conclusion: it was this rusted, wrecked rig into an ecoachieved through sound policy and nomic powerhouse of the future? the hard work and ingenuity of the Three decades later, the answer has Polish people. One of the architects of arrived firmly in the affirmative. Yes. this transition was Prof. Grzegorz W. We have converted the underperKołodko, Poland’s former Deputy Prime forming miserable economy of state Minister and Minister of Finance socialism into the competitive, open (1994-97 and 2002-03). To celebrate and prosperous market economy that this modern economic phenomenon, is admired by the world today. he delivered a keynote speech at In many respects, we have caught Poland Today’s first 'Poland & CEE: up with the world economy and conCo-building the Belt & Road' confer- tinue at full throttle. Granted, we are not ence in Warsaw. Here is an edited ver- that important from a global perspecsion of his speech. tive. Poland's GDP is just around 0.9% of the world economy’s total output and our population makes up approximately 0.5% of the world's population.

Our fertility rate is one-third of the replacement rate. Yet in a geopolitical and geoeconomic context, we have increased our standing by at least half a percentage point by my reckoning.

One might ask next: how did Poland achieve this metamorphosis? My mantra is that things happen the way they do because many things happen at the same time. Indeed, many things happened at the same time during Poland’s transformation.

Shock without therapy

From gelding to stallion

Economists usually refrain from using words like ‘miracles’, yet it is hard to deny that something special happened in Poland when it transformed from a failed communist experiment in 1989 to a tiger economy in less than 30 years. But can the success hold?

Another catchphrase that was popular at the time was ‘shock therapy’. Instead of easing into a market economy, the theory called for an acute and sudden liberalisation of trade and labour controls, along with the mass privatisation of public assets. As a reader of my body of work would attest, I prefer a slightly different interpretation when assessing its application in Poland’s transition. Namely, I use the phrase ‘shock without therapy’, for I argue that there were too many unnecessary shocks and not enough therapy. In fact, one could make the case that the transitional contraction at the onset of the ‘90s was larger than necessary.

While the nature of the journey remains a point of contention, there is little argument about the destination. Poland is one of two countries in the world (the other being Australia) that have enjoyed 27-28 consecutive years of economic growth. We were not even for a single quarter in recession because of proper institutions and sound policies. It was a rapid change. By the time I left government for the first time in the spring of 1997, GDP expansion was 7%. Poland’s GDP per capita (PPP) has already exceeded $30,000

or approximately 50% of the American standard. If we compare Poland’s economic performance to Ukraine’s or that of other transition economies – or even Germany and the West, for that matter – it is a real success story, if not a miracle.

But if one broadens the scope of analysis beyond the GDP data, a new dimension to the ‘miracle’ presents itself, a dimension which my theory of new pragmatism explores. This theory advocates for analysis and policy based not necessarily on the so-called GDP reality but on the strategy and mechanics of development. Here, the political changes are just as important as the economic transformation, especially when the goal is for long-term and sustainable economic growth. I must admit, I was much more concerned with the latter than the former back in the early 1990s. Conversely, the goal of political transformation was on the top of the agenda at the round table talks – the discussions held in 1989 between the government, the trade union ‘Solidarność and other opposition groups. Indeed, most thought it would be much easier to accomplish political democratisation than economic monetisation. However, somehow it transpired that we achieved just as much in the economic field as in the political realm.

In other words, through 30 years of tremendous work by the people of Poland – entrepreneurs, policymakers, intellectuals, almost everybody – we have built much more than just a market economy but a political democracy.

Now, democracy is not a requisite for economic expansion. One only needs to look at China to realise this. And yet we do value democracy in the west as much as the power of the free market.

We place our trust in private entrepreneurship but not without social inclusion, in the ‘invisible hand’ - but alongside proper government regulation. In light of this, it seems prudent to extend the analysis beyond the purely economic indexes. For example, if one looks at the Legatum Prosperity Index, the OECD Better Life Index, or the Inequality-adjusted Human Development Index, Poland is ranked higher in the world in all these indexes than in the GDP per capita ranking.

In short, we enjoy a higher quality of human capital and infrastructure than countries with a similar output.

International integration This year on July 11, it will be 23 years since I helped to bring Poland to the OECD. It is interesting that the NATO signing ceremony has been well publicised but little attention has gone to the day we joined the OECD. Of course, I consider Poland’s integration with the world’s leading economies as a bigger achievement. Similarly, European

integration was a must for us in 2004.

It is true that we both gained and lost freedom at the same time. One might say Kazakhstan or Turkmenistan is free.

Unlike us, they can do whatever they want with their exchange rate or competition policy. We have to fit in the institutionalisation of the European Union. We had to give a bit of national sovereignty for the common interests of the European Union, which I think is a good answer for globalisation.

Can the success hold?

versible, despite Brexit, Vive la France, America First, Alternative for Germany and Polska dla Polaków (Poland for Poles). It should also be remembered that globalisation began to gain traction around the same time as Poland entered its post-communist transition.

Poland, like its fellow transition economies, rose with globalisation. Precedent is important here. Having survived the tumult of the 1990s, there is no reason why Poland cannot buffer through the current headwinds.

As a student, I travelled to the United The Euro debate States for the first time in 1977. As established earlier, European inteInterestingly, the America I first discov- gration has been kind to Poland. But ered around two generations ago com- whether Poland should go one step furmanded a GDP per capita lower than ther and join the Eurozone is another which Poland enjoys today. This pic- question. My position on this matter ture should only improve over the next diverges from that of the Prime Minister, 20-25 years. The momentum of his- the Finance Minister, the Governor of tory is on Poland’s side. the Central Bank, the President and The current fundamentals also the leader of the ruling party, Law and bode well for the medium to long- Justice. I am very much pro euro. I think term, despite the bears of the market it would be a good move for Poland proclaiming a slowdown of growth. Of to join the euro common currency course, growth rates will naturally pla- and thereby usher in a convergence teau – it is unrealistic to expect that the with the proper exchange rate. What economy will grow perpetually above is the proper exchange rate? To put 5%. The growth forecast for 2019 places it in a nutshell, it is the rate which will Poland in 3rd position in the EU with a secure the competitiveness of Polish projected rate of 4.4%. In subsequent export sectors. A country like Poland years it will be a little bit less. In the must manage export growth so that it long run, of course, we are not going increases at a faster rate than domestic to repeat another 28 years without output. This is the main driving force economic recession. But we can sus- behind expansion. Furthermore, contain ourselves with a long-term target sidering that the turnover of approxiof 3-4%. Our current account is not a mately 70% of Poland’s exports and problem with a deficit of 0.4% of GDP. imports is settled in euro, the adoption At just below 2%, inflation is more than of the euro would eliminate the curmanageable. When I entered gov- rency risk in the area.

The other aforementioned camp, ernment for the first time, inflation surfaced around 37% and it was con- however, claims that Poland must wait sidered a great victory when it dropped until its prosperity index reaches that of Germany. Given the current politics, to 13% by the time I left in 1997.

The government has initiated a lib- it’s unlikely that we will have the euro eral regime of social transfers, which before 2025. I think it's rather a matter is helping to reduce income inequality for the second half of the next decade and poverty. Most of Poland’s poverty when the Polish złoty is expected to can be found in large family households further stabilise, although it could be and in this case, the so-called 500 Plus argued that it is already more stable family support programme is helping than the euro and the dollar. these families to exit poverty. And for the time being, the budget is under con- A look to 2039 trol. Public debt is around 47% of GDP A long fight lies ahead. We find ourselves and is falling relative to GDP. in a never-ending struggle for more At the onset of the third decade rationality in debate around economic of the 21st century, at a time of trade performance. From this perspective, tension, the rise of economic national- I put a lot of trust in business people and ism presents a challenge to the world entrepreneurs, sometimes even more and Poland alike. It has largely come than in the political class. But when we as a response to globalisation, or more return in 2039 to celebrate 50 years of specifically, out of the failure of neo- Poland’s great transition, I believe we liberal capitalism. I define globalisa- will do so in an even more successful tion as a historical and spontaneous Poland, one with even more imporprocess of international market liber- tance on the world stage. For this is alisation and the integration of national the process of learning by doing. We economies into one interconnected have learned a lot, including from our worldwide market. According to this mistakes. Hopefully, we will continue to definition, I believe globalisation is irre- learn and thrive in the future.

29 BUSINESS & ECONOMICS

The article is an edited version of Prof. Grzegorz W. Kołodko's speech

at Poland Today’s first 'Poland & CEE: Co-building the Belt & Road' conference in Warsaw (pictured).

To read more about the conference, see page 28

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BUSINESS & ECONOMICS

E-Mobility on rapid-charge A nationwide drive has laid the foundations for e-mobility to force open a new segment in the Polish economy, but it’s a finely balanced game with the pieces yet to fall into place. Will the local industry reach critical mass?

There are many topics that divide

William Burke is

an Australian writer based in Warsaw. In 2010, he brought the WWII-rescue story of Albert Göring to the world in his book Thirty Four and the BBC documentary ‘Goering’s Last Secret.'

He has studied in the US and Australia, ultimately obtaining an Honours degree in Economics (Soc. Sc.) from the University of Sydney. He has lived in Poland since 2014, researching and writing, among other projects, his second WWII epic.

Poland, such as climate change, energy policy and Robert Lewandowski’s strike rate for the national side versus club form. But the movement of e-mobility is not one. There is a surprising amount of bipartisan support for the growing industry. Prime Minister Mateusz Morawiecki said back in 2017 as the Minister of Development: “E-mobility is the first industrial revolution in which Poland could participate as a leader and not as a technology buyer.” A year later he announced a €3bn commitment to the industry over the next ten years. On the other side of politics, Rafał Trzaskowski, forthright mayor of Warsaw, said on the day his city had placed one of the largest orders of e-buses in Europe: “In Warsaw, we care about clean air and the fight against global warming, and the order of 130 electric articulated buses puts us at the avant-garde of Europe.”

There are already small signs that this enthusiasm in the political sphere has spilled over into the community through the up-take of passenger vehicles.

According to the European Automobile Manufacturers’ Association, the registration of new Electric Vehicles (EVs) in Poland grew by 22.9% from 1077 units in 2017 to 1324 last year. The gains have been slightly bigger in the category of Hybrid Electrical Vehicles (HEVs) where the product group saw 32.6% growth over the same period. Local policymakers and experts are cautiously optimistic. On one hand, they see great potential for e-mobility to open a whole new branch in the economy. But given the inherently disruptive nature of the technology, this new economic horizon will only be reached through a holistic strategy, synchronising governmental institutions with energy companies, the automotive industry and the ICT sector.

The plan The government’s vision for e-mobility has been articulated through three policy papers within the overarching national ‘Strategy for Responsible Development’ launched in February 2017. The key document is the ‘Electromobility Development Plan – Energy for the Future’ (Plan rozwoju Elektromobilności w Polsce „Energia do przyszłości”), which is broken down

into three main areas and phases culates that there should be one mildesigned to promote the development, lion EVs on Polish roads by 2025.

The plan is just one part of a nationproduction and adoption of the technology in the economy and society. The wide strategy to decarbonise the econfirst stage has already passed where omy and fight pollution. Currently, the the legislative groundwork was laid, country has the unenviable distinction including the Act on Electromobility of hosting 36 of the 50 most polluted and Alternative Fuels (Ustawa o cities in Europe. The mass reduction elektromobilności i paliwach alternaty- of combustion-engines on the roads wnych) in 2018 and the implementation should help to relieve Polish cities of a 2014 EU directive on alternative of this curse. On the other hand, the fuels infrastructure to encourage EV introduction of this amount of EVs is sales through financial incentives and expected to reshape the energy martax exemptions. This period was also ket. For example, the ministry projects to coincide with the development of that the country will need to generate the first polish-built EV prototypes, an as much as 4.3 terawatt hours of extra awareness campaign and a national electricity per year, which equates to charging network. With less than 1000 approximately 365,000 homes. Based public charging stations, the country on the average ten-year lifetime of a is a long way behind its counterparts vehicle, this would amount to 20bn zł in Western Europe. The European in added revenue for energy providers.

Alternative Fuels Observatory (2019) But the linchpin to the whole plan is ranks the Netherlands as number one that this extra energy is generated from in the EU with 41,117 public charging renewables and at a competitive rate. points followed by Germany (29,010), Otherwise, the true benefits of e-mobilFrance (25,675), the UK (23,868) and ity may not evidence without the green Sweden (7,914), although Poland’s energy sector enjoying a clear price 929 charging points beats each advantage over coal or indeed crude oil. country Visegrád Group (Hungary: To this end, the government is actively 663, the Czech Republic: 562 and promoting the use of smart meters and Slovakia: 545). The aim is to increase charging at the bottom of the daily that figure in Poland to 6400 by 2020, electricity price curve at night. If all with 1000 in Warsaw alone. goes to plan, oil consumption should The second and current stage will be reduced, providing the country with run until 2020. Here the aforemen- extra energy independence. tioned prototypes are set to enter a trial assembly-line stage, while the The now first charging stations are built and E-mobility is an intricate jigsaw puzsubsidies are offered on the purchase zle with a lot of the pieces yet to fall in of new EVs (€8.6k for private individu- place, according to Krzysztof Bolesta, als and €36k for local administrations) Vice President of the Electric Vehicles and e-buses (€240k for each bus). Promotion Foundation (Fundacja By 2025, the third phase is meant to Promocji Pojazdów Elektrycznych bring in the mass-production of locally- - FPPE). Bolesta believes that the most manufactured EVs, increasing market telling factor will be whether the indusdemand through reduced unit costs try can turn what is still a relatively and prices. The Ministry of Energy cal- niche product into one produced at economies of scale. “When this finally happens, we will all have to figure out how to make e-mobility work at scale,” he said. “And I mean: making sure the grid is ready to handle all EVs; making sure car manufacturers are capable of meeting demand for EVs; making use of EVs as energy storage units and integrating them with … green generation sources; figuring out how to replace fuel duties in national budgets; cooperating with local administration on how

6,400 public chargers in total are planned in Polish cities for 2020

31

Electric charger for city buses in

Warsaw. By the end of July 2019 the city had purchased 130 electric buses which will join the current fleet of 200 zero- and low-emission buses (electric, hybrid and LPG fueled).

BUSINESS & ECONOMICS

Number of public chargers Polish Cities should have by 2020: - Warsaw (1.76 m pop.)

60 chargers:

- Ruda Śląska (0.14 m) - Rybnik (0.14 m) 210 chargers: - Zielona Góra (0.14 m) - Kraków (0.76 m) - Tychy (0.13 m) - Łódź (0.69 m) - Gorzów Wlkp. (0.12 m) - Wrocław (0.63 m) - Dąbrowa - Poznań (0.54 m) Górnicza (0.12 m) - Gdańsk (0.46 m) - Płock (0.12 m) - Szczecin (0.40 m) - Elbląg (0.12 m) - Bydgoszcz (0.35 m) - Opole (0.13 m) - Lublin (0.34 m) - Wałbrzych (0.11 m) - Włocławek (0.11 m) 100 chargers: - Tarnów (0.11 m) - Katowice (0.29 m) - Chorzów (0.11 m) - Białystok (0.29 m) - Koszalin (0.11 m) - Gdynia (0.24 m) - Kalisz (0.10 m) - Częstochowa (0.22 m) - Legnica (0.10 m) - Radom (0.21 m) - Sosnowiec (0.20 m) - Toruń (0.20 m) - Kielce (0.19 m) - Rzeszów (0.19 m) - Gliwice (0.18 m) - Zabrze (0.17 m) - Olsztyn (0.17 m) Local administration's electric bus targets: - Bielsko-Biała (0.17 m) - Bytom (0.17 m) source: Electric Vehicles Promotion Foundation (population in administrative boundaries) source: Electric Vehicles Promotion Foundation

2020: 5% 2022: 10% 2024: 20% 2027: 30%

Registrations of new Electric Vehicles in Poland:

82

116

164

2013

2014

2015

2016

192 electric city buses were operative

in Poland in June 2019. By 2023 their number is set to reach 1500 units. Pictured above is one of the electric buses in the city of Katowice.

1355

Source: SAMAR

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photos: Arkadiusz Lawrywianiec (Forum), Praetorian Photo, Tramino

1000 chargers:

484 2017

637 2018

January-June 2019

BUSINESS & ECONOMICS

Battery producers based in Poland: operating:

- Impact Clean Power Technology (70MWh)

under construction: - LG Chem (4-6 GWh)

announced:

- Umicore - Guotai-Huarong - Daimler - Northvolt - SK Innovation - Capchem

‘Poland’s exports of lithium-ion batteries had already overtaken Germany’s share of the EU’s total export market in Q1 2019’ to best assist car owners with new infra- Electricity demand for structure; and last but not least, mak- estimated number of vehicles: (Source: Ministry of Energy) ing sure the central government keeps regulation fit for purpose.”

2016: 2,397 vehicles (5,303 MWh) While the intent and spirit has been 2017: 5,704 vehicles (12,621 MWh) lauded, the implementation has already 2018: 13,576 vehicles (30,039 MWh) 2019: 32,310 vehicles (71,492 MWh) come under some criticism. A recent 2020: 76,898 vehicles (170,150 MWh) draft regulation on subsidies was found 2021: 183,017 vehicles (404,958 MWh) wanting by experts. Firstly, according 2022: 366,034 vehicles (809,915 MWh) to the current proposal, businesses 2023: 549,051 vehicles (1,214,873 MWh) 2024: 823,576 vehicles (1,822,309 MWh) were not included in the proposed sub2025: 1,029,470 vehicles (2,277,886 MWh) sidy programme, which was considered a large oversight given the size of the announced in July that it plans to field 10,000 battery modules per year. Not sector’s extensive car fleets. The top- 400 zero or low-emissions buses by to be outdone, the South Korean giants selling EVs on the market are ineligible 2021 and remove diesel buses from of LG Chem and SK Innovation made for the subsidy as the price limit is set at the signature Royal Route that runs waves this year with their own respeca low 125,000 zł gross, effectively mean- through Warsaw’s premier downtown tive expansion plans. SK’s proposed ing that only low-end compact mod- shopping, historical and tourist hot- 1bn zł plant in the Katowice Special els attract the benefit. This has caused spots. This year’s record purchase of Economic Zone is expected to create some to question whether the main 130 electric Urbino 12 buses from Polish- over 300 new jobs, while LG Chem goal of replacing combustion-engine manufacturer Solaris comes after the received €36m investment aid from the vehicles will be achieved, since these city received 61 hybrid buses from MAN EU to expand local production with the vehicles accommodate fewer passen- Truck & Bus in June last year. addition of a €325m production facility.

A Lithium Valley is being carved out Solaris Bus & Coach SA, based near gers and offer low range in kilometres.

But Bolesta was quick to emphasise Poznań, has been rapidly expanding its in Silesia with five of the six aforementhat this is the very reason why draft electric and hydrogen bus lines, win- tioned plants to operate in the region. legislation is published for consultation. ning contracts not just domestically Given current growth trends and the “We are still waiting on these regula- but abroad. In July the company signed capacity yet to come online, Poland is tions. The most important thing is that a framework agreement to supply the likely to replace Germany as the EU’s nowhere in the world have EV markets city of Milan with 250 Urbino 12 elec- export leader in lithium-ion batteries. developed without subsidies, so if we tric buses, a new record in Europe. The The publication Obserwator Finansowy are serious about e-mobility, a support first delivery of 40 units is scheduled (Financial Observer) reported in April system is needed here as well.” for as early as June 2020. The company that Poland’s exports of lithium-ion bathas done well in Italy this year, having teries (€161m) had already overtaken The scope secured Urbino 12 electric contracts Germany’s share (€120m) of the EU’s In the Electric Vehicles Promotion with Bergamo, Bolzano and Venice. total export market in Q1 2019.

Foundation’s 2018 report ‘Charging Back in Poland, there has been an What are the next big trends to Poland’, the authors recognised the investment frenzy in the lithium-ion watch out for? For a dark horse secelectric bus sector as the cornerstone battery sector, the all-important com- tor, Bolesta sees the greatest potential of the local e-mobility industry and an ponent for any electric motor. The in utility vehicles. “It's a niche too small area rich with investment potential. The ‘Strategy for Responsible Development’ for big players and one that no-one has e-bus industry is already well-estab- was launched by the then Ministry of really explored yet.” But all eyes should lished in the country, both in manufac- Economic Development in February be on Poland’s 84.3bn zł automotive turing output and its presence in the 2017 and within a year the world’s lead- parts and accessories sector and how it public eye. It is hoped that its success ing battery producers began to line up responds to the EV revolution. One key in sales, R&D and public awareness will to announce plant openings and expan- fact stands in its way: the EV comprises trickle through to the rest of the indus- sions around the country. The Chinese only 18 moving parts compared to try and, in turn, the wider economy. The were first to move. Capchem 2000 in a standard combustion-engine national e-mobility plan also makes announced in March 2018 the con- vehicle. Overall, this, of course, means special mention of the e-bus market as struction of a ¥360m (appx. 200m zł) fewer repairs and hence less future reva catalyst sector. The plan is to increase factory in Wrocław and in May Guotai- enue for the industry. This development the share of e-buses in cities and towns Huarong declared a $45m investment should impact all producers of automofrom 5% in 2020 to 30% by 2027. As of in a factory in Godzikowice, Lower tive parts around the world, but given January 2019, there were 178 e-buses in Silesia. The Europeans followed suit. In that the parts and accessories sector operation throughout the country with the south of Poland, Belgium’s Umicore accounts for 80% of jobs and 58% of a further 274 on order. announced a huge 1.38bn zł invest- production in the automotive indusThe capital city of Warsaw is pav- ment in a plant in Nysa and in the north, try, the disruptive effects may be felt ing the way. The city’s bus authority Sweden’s Northvolt revealed plans to even more acutely in Poland. Watch this (Miejskie Zakłady Autobusowe: MZA) build a factory in Gdańsk to produce space. by William Burke

photo: SVproduction

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CONFERENCE BUSINESS MIXER & GALA AWARDS

URBAN E-MOBILITY FORUM 2019 14-15 November, Pomeranian Science and Technology Park in Gdynia

Urban E-Mobility Forum 2019, the event co-organised by The Electric Vehicles Promotion Foundation and Poland Today, aims to help all sides of the e-transformation process to find better and more effective solutions to implement e-mobility in cities across Poland.

Peter Vesterbacka

visionary and serial entrepreneur (Finland) Elżbieta Bieńkowska

European Commissioner for Internal Market, Industry, Entrepreneurship and SMEs Erik Koppe

Project Manager, Allego (Netherlands) Katarzyna Gruszecka-Spychała

Deputy Mayor, Gdynia

Registration and more information: www.poland-today.pl

HONORARY PARTNERS:

STRATEGIC PARTNERS:

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BUSINESS & ECONOMICS

A rendez vous with Peter Vesterbacka Poland Today crossed paths with Peter Vesterbacka during the GreaterBayX tour in China and a chat with the tech visionary was too irresistible to turn down.

Buckle up – time to talk e-vehicles, tech startups and business in China.

Peter Vesterbacka,

the Finnish 11 years. It was a diverse group built marketing wunderkind-turned-tunnel around Slush Shenzhen, with two days builder, has made a career of proving in Guangzhou, two days in Hong Kong, people wrong. As the CMO of Rovio two in Shenzhen and one in Macau.

Entertainment, he drew laughs when These cities also happen to be central he declared in 2009 that the Angry to the Belt & Road initiative.

Birds mobile game would hit one million downloads. The game series is now What are your ambitions for Slush approaching five billion downloads. China and China in general?

It was the same case in 2008 when We have done Slush five times before he co-founded the tech conference in China. The first was in Shanghai and Slush. From a showing of 300 people now we also organise Slush events at its inaugural event in Helsinki, it has in Nanjing in June and Shenzhen in Richard Stephens is editor of Poland Tobecome the world’s leading startup August. Slush in Shanghai now attracts day, which he founded event with sister events in Japan, China around 3,000 people. Why did we go in 2012. He also organand Singapore. In 2016, he also attracted to China? Simple: big nation, lots of citizes, runs and moderates conferences on incredulity when he announced that he ies with huge populations. Shenzhen a variety of topics in would build a 103km undersea railway is central to the Greater Bay Area with Poland and abroad. tunnel between Finland and Estonia, lots of talented young people, so it’s a He was previously ediincluding an artificial island to accom- no-brainer to be there. Of course, there tor of Eurobuild CEE magazine and founded modate 50,000 people. This year, he are differences. For starters, the core the Eurobuild Awards and his partner Kustaa Valtonen landed of Slush is organised by young peoGala event. Rich€15bn in financing for their FinEst ple. 3,000-4,000 participants and 330 ard has a degree in Bay Area project. local volunteers were needed for the Theology & Religious Studies from Bristol The moral of the story is when first Slush event in Shenzhen, as well University in England. Vesterbacka speaks, listen – and listen as 2600 volunteers from many differcarefully. That’s exactly what Poland ent countries. It was a massive learning Today did when we first caught up with experience. I was super happy to see him in June at our Belt & Road confer- 330 young Chinese people volunteerence in Warsaw and more recently, on ing. What we're bringing to the Chinese the sidelines of the GreaterBayX tour, a ecosphere is the volunteer culture and two-week roadshow of events, work- a global perspective. shops and business meetings between the key cities in China’s Greater Bay Slush already commands a large Area. Vesterbacka is a polymath of sorts presence with events in Finland, and conversations with him can venture Japan, China and Singapore, but into any realm of human enterprise, but do you aim to spread Slush to given the setting of our meeting and other parts of the world? his upcoming keynote address at the We’re happy to focus on Eurasia.

Urban E-Mobility Forum in Gdynia, the It has 5 billion people, 70% of the world’s conversation naturally centred on his population. It’s where the action is. involvement in China and the e-mobil- Originally, we didn't have plans to move ity movement, including his innovative outside Helsinki, but it moved organitake on electric vehicle production. cally. Bringing young people together, it makes a big contribution to the startup eco-structure.

What was the tour to China

about and how was it organised?

It was part of what we've been working on with the Greater Bay Area, connecting the FinEst Bay Area with the region and bringing people from these two areas together. A lot of companies from different fields took part, from education and healthcare to gaming.

The Finnish and Chinese governments were doing things together. There was also city-to-city cooperation. For example, the city of Hyvinkää has been twinned with the city of Kunshan for

Do you perceive that there is a fear of China in the West, particularly a fear of its size and power now and in the future?

People fear the unknown – it’s natural and human. This is why we, the FinEst Bay Area, went to the Greater Bay Area: it’s best to go see for yourself. You hear the comment that the Chinese copy everything. You could say that about Germany as well. It's an easy stereotype. China is way ahead in many

Peter Vesterbacka Peter Vesterbacka is the co-founder

of FinEstBay Area Development. Previously, he served as the Chief Marketing Officer and Mighty Eagle of Rovio Entertainment. He has also worked at the original startup HewlettPackard and founded among others Slush and Mobile Monday. Lately, Vesterbacka has focused on education-related ventures, as well as developing the world's longest subsea tunnel connecting Finland and Estonia.

areas. Of course, this can be scary, too.

Yes, it's a massive market, but people are people. They have families, they go to school, they do business together, they live their lives. It’s always important to create connections between people. People who do business together don't usually go to war, something we've seen in Europe many times.

How you avoid conflicts is to have good business and personal relations. That's why walls, trade wars and things like Brexit are not good. Once you engage in dialogue you realise that people are the same everywhere. My good friend in China invited me to his house for a BBQ. I met his wife and kids, and they were talking about regular things. He said he has Japanese friends and that they are very good people, despite the history between Japan and China.

It’s not the people saying bad things, it’s the governments.

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BUSINESS & ECONOMICS

As the keynote speaker at the Urban E-Mobility Forum in Gdynia in November, what message do you want to get across at the conference?

The Polish government wants to have 1m electric vehicles on the road by 2025 and yet the local energy market has shown no real I want to look at the bigger e-mobil- signs of making a big move away ity picture. What people see is elec- from coal: 78.1% of the country’s tric vehicles, but we need to look at electricity was generated from coal the whole world of e-mobility. One in 2018. What’s the point of having area is MAAS [Mobility-as-a-Service]. 1m electric vehicles when they’re The Finnish company MaaS Global powered by dirty energy sources? has created an app merging multiple modes of transport in one transport chain through one monthly subscription. Maybe start with a taxi, train, boat, train or a taxi again, whatever it takes to get you from A-B most efficiently.

It’s kind of like the next generation of Uber. The other point is that it's not just about deregulation but also about setting regulation. In Finland, providers are mandated [through the Act on Transport Services] to share ticketing functionality with third parties, so you can create the multimodal chains using many different modes.

You are connected with the Estonian startup Nobe, manufacturer of the three-wheeled Nobe 100 electric vehicle. In which other areas are you involved in the e-mobility industry?

You’re right that it doesn't make sense to have electric vehicles if the energy is dirty. All governments need to get serious about getting rid of coal.

In Finland, we are stopping the use of coal by 2025-30, but we also have nonsustainable power. There needs to be a plan to replace coal with renewables and to take a longer-term view. We need methods to use cleaner energy. It’s not just Poland; Germany has not done a very good job either. It decided to get rid of nuclear, which is better for the environment than coal. But now they're cutting down forests. It’s always important to see the bigger perspective.

‘It’s always important to create connections between people.

People who do business together don't usually go to war, something we've seen in Europe many times.’

Peter Vesterbacka

will be a keynote speaker at Urban E-mobility Forum in November in Gdynia.

The event, co-organised by The Electric Vehicles Promotion Foundation and Poland Today, aims to help all sides of the e-transformation process to find better and more effective solutions to implement e-mobility in cities across Poland.

Electric cars don’t

need to be dull, says Vesterbacka. He praised the design of the Nobe car and joined the company as a marketing and brand advisor.

and also helped with the marketing and branding. Not all electric vehicles have to be similar. We want to bring a bit more fun and excitement to the vehicles. Nobe is itself exciting and has a super nice design. Also, the way they will be made is important. They will be built with sustainable and replaceable parts, so you can upgrade the vehicle during its lifetime, such as replace the battery if batteries are upgraded, change the panels to change the colour, and so on. Another thing is that instead of big factories, we'll make nano/micro factories which produce about 200 vehicles per year, so they can be smaller, more local and close to the consumer, making the factories more of an experience where you can watch your car being made and test drive it. Will this approach work? We’ll only know if we try. We're very optimistic about the model – it resonates with people. There is great interest in how we will make and deliver the car.

We need to get to a stage where we don't need government subsidies. They might be needed to get things going, but over time electric vehicles will be cheaper than current models. And when you have more vehicles, they will need more infrastructure, and private businesses will be more than happy to step in. Even in the US, Tesla sales have benefited from subsidies, and Norway is now leading the way with the highest percentage of electric vehicles, although they can do so because of the revenue from selling oil. Of course, it's not black and white. But the only way to make this sustainable is to reduce dependency on government subsidies. On the global scene, right now there is a shortage of electric vehicles. Does it make sense for the Polish government to subsidise electric car production to kickstart it? It's a good question. If not, it could delay development in Poland, which is needed now.

interview by Richard Stephens

photos: Nobe

According to Poland’s national Electromobility Development Plan, the government plans to take an active role in providing public charging infrastructure, R&D and subsidies.

In terms of electric vehicles, I invested At which point should the private in Nobe and bought one [Nobe 100], sector step in to pick up the slack?

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BUSINESS & ECONOMICS

Business success in translation In a global market, businesses are eager to expand abroad but some deals may be lost in translation. Poland Today spoke to intercultural communication experts to grasp a better understanding of Poland’s business styles in relation to dealing with EU neighbours.

Intercultural communication refers

to communication between people from different cultures. It’s a symbolic, interpretive, transactional, contextual process, in which people from different cultures create shared meanings.

This type of communication requires an understanding that different cultures have different customs, social norms and being able to accept these differences and adapting to them is necessary to communicate effectively.

“You may meet people who have a completely different understanding of the world, and that’s the beauty of it,” says Wojciech Kolodziejczak, life networker and Polish specialist for Akteos, a leader in cross-cultural training.

It has all the trappings of a cliché, but in the modern European business marketplace, intercultural communication is proving increasingly beneficial.

In Poland, an awareness of cross-cultural differences is vital for business relationships to grow.

Poland is Europe’s modern business success story. Upgraded last year to developed market status by FTSE Russell, thereby joining the ranks of the world’s 25 most advanced economies, it continues to defy expectations, with its economic star rising ever further by the day. A certain insulation from the turmoil of financial slumps, however, does not mean the country is neglecting its global or European cousins. Far from it. It was Poland’s accession to the EU in 2004, says Kolodziejczak, that first brought intercultural awareness to the fore in the country. “It had to open its borders to other cultures,” he explains.

“As a result, the country is changing.”

Driving progress then, as now, were high levels of international investment and cooperation, which might make it seem as if there is a global awareness of the differences between business styles in communicating with Poland.

But though the rise of intercultural understanding has contributed to its success, there is a long way to go. This begins with multinationals recognising the legacies of past economic attitudes, which still lie heavy today.

photos: PeopleImages (Getty Images)

Entrenched attitudes For Kolodziejczak, Polish business relationships struggle most from the repercussions of tradition and history. For all its budding international connections, Polish business relationships can resemble the nation’s age-old moniker as ‘a country on the moon’. Kolodziejczak blames the “shadows of the post-communistic world” as the reason behind limited employee connection, even within Poland itself. “When I teach networking to Poles,” he explains, “it’s very hard for them to trust each other.”

In the 2017 World Bank Group Doing Business report, Poland was ranked 24th globally in terms of ease of doing business, though the European Commission’s Public Administration Characteristics and Performance report in 2018 suggested that Polish businesses often demonstrate “a preference for behaviour focused on rivalry and competition rather than cooperation,” an attitude which stems from the spectre of post-communistic suspicion.

This makes trust a slippery issue, especially between Polish and multinational

businesses. Polish business runs on passion and etiquette, but this is set against a historical sense of reservation and sincerity, with a goal-oriented focus.

The British-Polish Chamber of Commerce (BPCC), meanwhile, suggests difficulties arise because Polish business attitudes are constantly transforming and therefore difficult to manage – and this is mainly down to a generational divide in business attitudes across time. Though history still plays its role, they point out that that “younger generations are more familiar and at ease with Western European and American styles of conducting business, but for a large part of the older population, memories of communism, its fall and the economic transformation in the 1990s are very strong.” While this focus on competition and expansion may be good news for entrepreneurs operating in the Polish marketplace, international communication is necessary to note and exploit these differences as Poland faces a different future.

Talking business Kolodziejczak argues more can be done to recognise intercultural divides, believing that “most people think that in this globalised world, everything is connected – that there are no differences, we all speak the language of business.”

But, as he points out, with underlying issues of distrust between companies, it is difficult to become fluent. Keen to stress the early-stage difficulties in business communication, Kolodziejczak says, “The Dutch, for example, are quite direct, the Polish are direct, too. More than, for example, the British, because British culture is a high-context culture.”

In the business world, this is a doubleedged sword – and Aleksej Heinze, Associate Professor in Digital Marketing, agrees. “Because Polish collaborators are generally responsive and comply with agreed deadlines and high-quality work outputs,” he says, “they are often selected as international project partners.” As more direct business leaders, Poles can execute projects well, though employee management may get lost in translation.

Konrad Krzysztofik, Senior Global Production Manager at Lionbridge, a provider of translations and internet marketing, understands that this too

‘Speaking the same language is not all that it takes to communicate efficiently’

begins with historical precedent and boardroom. He is the academic leader the importance of recognising pat- of Businessculture.org, a site which has terns of behaviour to improve intercul- prepared intercultural awareness guides tural awareness as Poland develops its for 31 countries. The Polish guide offers international business relationships. His specific instructions on how internaworkshops on intercultural communica- tional business leaders can adjust to the tion reinforce the idea that “speaking “strict adherence to protocol” in Poland. the same language is not all that it takes And Kolodziejczak’s work is similar. In his to communicate efficiently”. He points intercultural training sessions, he often out that, ironically, the term ‘phatic uses a simple card game to explain the communication’ – denoting language unique behavioural patterns held by used for social interaction or more separate nationalities. Attendees are commonly known as small talk – was separated into groups of card players, coined by acclaimed Polish anthropol- with each allotted a different card to ogist Bronisław Malinowski. And, for be of the highest-value. The winner of sociologist Adam Aksnowicz, doing the group then rotates into a different business with Polish companies is fun- group of players, with a different highdamentally diverse. Though Poland still est-value card. The immediate upshot, bears a traditional hierarchical business of course, is confusion, rather than structure, it is open to new approaches, success. “In international business, it’s with a “critical role of language, particu- exactly the same,” he explains. “You may larly English, as a key to multicultural come across people that have a comcommunications in Poland.” For mul- pletely different set of rules.” What is tinational businesses operating in this important, therefore, is to be able to reccountry, “this environment seems ripe ognise when these rule changes occur, for businesses to develop their own and act accordingly. diverse corporate cultures, ones that recognise the differences of the local Cross-cultural cooperation community, while at the same time inte- Playing cards aside, intercultural trainer grating some of those elements into Dr. Malwina Bakalarska says cross-culexisting cultural frameworks.” tural understanding allows for even According to Heinze, different lan- the strictest of cultural boundaries and guages can also offer a potentially values to be navigated with ease. She productive tool in the business world, says, “values are something which we before companies even arrive in the are ready to fight for ...That is why intercultural training is so helpful. They provide knowledge about these sensitive cultural zones and at the same time they give the participant the opportunity to practice overcoming potential conflicts.”

Poland may be porous at the business level, welcoming international business ballast with open arms – although since its accession to the EU many, the younger generation especially, like Kolodziejczak, have also chosen to seek careers in other nations. At the job level, the situation is also decidedly diverse, with corporate firms boasting international staff and, at a governmental level, almost every current policymaker in Poland has studied in the West. Poland is open for business, but business must be open for Poland too. Intercultural understanding works both ways.

As an immigrant himself, Kolodziejczak says, “You’re more open to different things. Once you’ve been in one country for a while, when you go back to your original country – your native place – you are different.” But this comes with endeavour, and business acumen is required to avoid the stillprevalent stumbling blocks between borders. It is an attitude that multinational businesses should seek to emulate, particularly when communicating with Polish companies. “When people know you, like you, and trust you,” he explained, “then you will have opportunities in your life.” by Juliette Bretan

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BUSINESS & ECONOMICS

Juliette Bretan is

a freelance journalist covering Polish and Eastern European current affairs and culture. She has been featured on the BBC World Service, and in The New Statesman’s CityMetric, The Independent, Hromadske, New Eastern Europe and CultureTrip, among others. She is currently a postgraduate student at the School of Slavonic and Eastern European Studies at UCL, and has a degree from Cambridge.

38 international reach BUSINESS & ECONOMICS

statistics

compiled by Bartosz Stefaniak

PAIH, the Polish Investment and Trade Agency, has undergone an unprecedented expansion, opening offices in dozens of cities across the globe. The aim is to project Poland's increasing business and economic confidence around the world, helping Polish businesses establish and grow new markets, and seeking to direct smarter foreign investment back home.

Poland Today has put together a list of every PAIH office in the world and included key information about Poland's trade with each country market. foreign trade offices around the world

Polish Investment and Trade Agency assistance to Polish exports

Entering new markets can be challenging, which is why the Polish Investment and Trade Agency (PAIH) steps in to help businesses jump into unknown territories. The Agency takes care of legal and administrative processes but also assists with finding locations, partners and suppliers. PAIH’s Foreign Trade Offices are located in markets which show rapid growth and potential for Polish companies.

The direct assistance on-site works both ways – offices have also been designed to attract foreign investors and assist them on their way to set up businesses in Poland.

Years

Export Enquiries Serviced

Contracts Completed

Completion Rate

2016-2018 2019 (Q1+Q2)

22,000 8,274

400 152

1.82% 1.84%

source: PAIH

PAIH's main Polish clients are

SMEs in the Information and Communications Technology (ICT), construction, cosmetics and agri-food sectors.

In July 2019 there were 22 Polish FDI projects in PAIH's pipeline.

Between January and July 2019 PAIH serviced also over 200 Polish export missions abroad and over 500 B2B.

Poland's exports of goods and services source: OECD

361

USD bn (44.4% GDP)

2012

USD bn (52.2% GDP)

USD bn (54.3% GDP)

USD bn (55.3% GDP)

440

479

525

2016

2017

2018

383

409

USD bn (47.6% GDP)

USD bn (49.5% GDP)

2013

2014

2015

USD bn (46.3% GDP)

558

Poland's trade exchange

Trade of goods:

Poland's exports to... (2018) Poland's imports from... (2018)

Trade of services:

Poland's exports to... (2017) Poland's imports from... (2017)

source: Statistics Poland

Croatia

Ireland

Netherlands

Sweden

Argentina

Czechia

Israel

Nigeria

Taiwan

Australia

Denmark

Italy

Norway

Thailand

Austria

Egypt

Ivory Coast

Peru

Turkey

Azerbaijan

Ethiopia

Japan

Portugal

Ukraine

Belarus

Finland

Kazakhstan

Romania

United Arab Emirates

office in Algiers $376 mn $37 mn $13 mn $4 mn

Trade volume:

< $1 bn

Algeria

> $20 bn

office in Buenos Aires $119 mn $698 mn $8 mn $12 mn office in Sydney $661 mn $495 mn $103 mn $73 mn office in Vienna $5,146 mn $4,530 mn $1,111 mn $1,140 mn office in Baku $80 mn $13 mn $7 mn $2 mn office in Minsk $1,703 mn $1,483 mn $1,127 * $202 mn

Brazil

office in São Paulo $491 mn $1,823 mn $46 mn $26 mn

Bulgaria

office in Sofia $1,258 mn $762 mn $164 mn $238 mn

Canada

office in Toronto $1,408 mn $496 mn $517 mn $147 mn

Chile

office in Santiago $266 mn $148 mn $12 mn $3 mn

China

offices in Shanghai and Chengdu $2,501 mn $30,972 mn $347 mn $459 mn

Colombia

office in Bogota $82 mn $278 mn $6 mn $4 mn

office in Zagreb $995 mn $207 mn $70 mn $355 mn office in Prague $16,657 mn $9,151 mn $1,800 mn $1,836 mn office in Copenhagen $4,572 mn $2,931 mn $1,383 mn $811 mn office in Cairo $318 mn $179 mn $21 mn $165 mn * office in Addis Abeba $20 mn $5 mn $1 mn $1 mn office in Helsinki $2,222 mn $1,993 mn $839 mn $265 mn

France

office in Paris $14,518 mn $9,769 mn $2,324 mn $2,154 mn

Georgia

office in Tbilisi $136 mn $20 mn $14 mn ** $26 mn

Germany

office in Frankfurt $73,691 mn $59,956 mn $13,471 mn $8,337 mn

Greece

office in Athens $1,026 mn $589 mn $103 mn $414 mn *

Hungary

office in Budapest $6,986 mn $4,310 mn $604 mn $433 mn

India

office in Mumbai $819 mn $2,124 mn $119 mn $101 mn

Indonesia

office in Jakarta $153 mn $861 mn $11 mn $16 mn

office in Dublin $1,178 mn $1,684 mn $1,377 mn $1,564 mn office in Tel Aviv $693 mn $474 mn $270 mn $121 mn office in Milan $12,043 mn $13,433 mn $1,216 mn $1,504 mn office in Abidjan $38 mn $175 mn $402 mn $1 mn ** office in Tokyo $671 mn $4,172 mn $183 mn $203 mn office in Nur-Sultan $521 mn $2,127 mn $26 mn $11 mn

Kenya

office in Nairobi $47 mn $34 mn $1 mn $8 mn

Kuwait

office in Kuwait City $108 mn $4 mn $8 mn $8 mn

Lithuania

office in Vilnius $3,850 mn $2,177 mn $590 mn $381 mn

Malaysia

office in Kuala Lumpur $185 mn $984 mn $30 mn $69 mn

Mexico

office in Amsterdam $11,834 mn $9,653 mn $3,628 mn $2,035 mn office in Lagos $110 mn $297 mn $46 mn $43 mn office in Oslo $3,090 mn $3,044 mn $818 mn $364 mn office in Lima $71 mn $128 mn $1 mn $2 mn office in Lisbon $1,141 mn $1,042 mn $148 mn $183 mn office in Bucharest $5,373 mn $2,420 mn $313 mn $243 mn

Russia

office in Moscow $8,008 mn $19,641 mn $1,014 mn $443 mn

Saudi Arabia

office in Riyadh $850 mn $1,237 mn $36 mn $9 mn

Senegal

office in Dakar $69 mn $15 mn $1 mn $0 mn

Singapore

office in Singapore $278 mn $506 mn $263 mn $157 mn

South Africa

office in Mexico City $754 mn $773 mn $30 mn $37 mn

office in Johannesburg $776 mn $454 mn $31 mn $27 mn

Mongolia

South Korea

Morocco

Spain

office in Ulan Bator $58 mn $1 mn $2 mn $1 mn office in Casablanca $366 mn $536 mn $9 mn $41 mn *

office in Seoul $615 mn $4,817 mn $307 mn $121 mn

office in Madrid $6,722 mn $5,948 mn $732 mn $899 mn

office in Stockholm $7,258 mn $5,141 mn $1,868 mn $927 mn office in Taipei $148 mn $1,563 mn $49 mn $23 mn office in Bangkok $281 mn $897 mn $18 mn $47 mn office in Istanbul $2,999 mn $4,504 mn $117 mn $213 mn office in Kiev $5,271 mn $3,033 mn $1,467 mn * $400 mn

office in Dubai $529 mn $295 mn $100 mn $65 mn

United Kingdom office in London $16,198 mn $6,475 mn $4,272 mn $3,198 mn

United States

offices in New York, San Francisco, Washington, Los Angeles, Chicago and Houston $7,282 mn $7,615 mn $3,582 mn $1,966 mn

Uzbekistan office in

Tashkent $188 mn $54 mn $6 mn $2 mn

Vietnam

office in Ho Chi Minh City $338 mn $2,951 mn $12 mn $29 mn * 2014 (more recent data unavailable) ** 2016 (more recent data unavailable)

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BUSINESS & ECONOMICS

New trade frontiers In 2015, Poland’s newly-installed government hatched a bold plan to become not only an importer but also an exporter of capital. Poland Today spoke to one of the architects behind this new trade strategy: Krzysztof Senger, PhD, Executive Vice President of the Polish Investment and Trade Agency (PAIH).

From the first day

Krzysztof Senger, PhD, has over 12 years of experience in international business, as well as in investment finance and project management. He earned a doctoral degree at the Adam Mickiewicz University in Poznań, specialising in economic development.

Before joining PAIH as Vice President, Senger worked in consulting for PwC and Deloitte, acted as an independent advisor and international expert in negotiations of free trade agreements with the EU, and participated in international projects related to innovation and R&D.

‘Since 2015, total capital expenditure has increased from ¤500m to ¤2bn’

Dr Krzysztof eager to shepherd investment to other areas in the economy for a more diverSenger joined PAIH in 2016, he had his work cut out for him. A new governsified portfolio. “We are talking to new investors who are looking for new asset ment had just been elected and wanted classes, such as real estate, both comto change the country’s trade narrative, moving away from a developing mercial and residential. And then there are investors looking for infrastructure country mainly focused on attracting foreign investment to an exporter of assets, particularly from the Gulf region.”

Polish investment and goods. A growThe best way to achieve this, he said, ing group of companies had already is through good old-fashioned marketblazed a trail into foreign markets and ing. “Our core business is to spread the made a strong case for a trade agency word, not only through conventional to assist both existing and upcoming channels to promote the Polish brand export sectors. The Polish Information but also through ‘whisper marketing’ by and Foreign Investment Agency our staff attending thousands of meet(PAIiIZ) was replaced by the Polish ings around the world.”

Investment and Trade Agency (PAIH) PAIH’s role as a facilitator and diswith the operative word being ‘trade’. seminator of information is perhaps Dr Senger, a former senior manager at even more important in its export and Deloitte and PwC, received a doubletrade operations. Polish companies are pronged assignment: expand Poland’s well accustomed to doing business in the EU, but the picture becomes a litbusiness presence around the world and increase inbound investment. This tle more uncertain and complex as they meant opening trade offices all around travel further afield. “The challenge is the world, from Helsinki to Santiago. the USA in the nine-metre or under a lack of information on a given marAnd fast. “We established an entire category. Last year, the country sur- ket,” he said. “If we are talking about global network of trade offices within passed Germany to claim 2nd place in African countries or far East Asian two years,” Dr Senger told Richard video game console exports. With 20% countries, we deliver guidance to our Stephens, Editor of Poland Today, share of EU exports, Polish manufactur- clients on the business environment, in a PT Live special on trade. “I think ers trailed only the Netherlands (31.8%). the way of doing business and dealt's a world record.”

There is still a lot of room for improve- ing with partners to lower the risk After taking a hit during the global ment in exports, according to Dr Senger. of entering new markets.”

Speed is the essence when it comes financial crisis followed by an about-turn “We need to think in the long term and in 2010 with an annual growth rate of we still need time for building global to penetrating a foreign market and 13.1%, the Polish export sector has since brands, technology and innovation.” achieving capacity. That is where PAIH recorded steady growth rising from tries to step in with the know-how to 4.6% in 2012 to 9.45% in 2017, before Time to promote lubricate and expedite the transition.

“We are helping companies to find cooling down to a sustainable 6.3% in the Polish brand 2018 (OECD). Exports are expected He was quick to emphasise that PAIH the right business model for a speto pick up again this year, considering has not lost sight of its original man- cific market. How to enter, for examthat the first-quarter results (January- date of helping “foreign companies find ple, the United States or China,” he April) showed 3% year-on-year growth the best locations in Poland” to invest, said. “You need to understand how to (Statistics Poland). While Polish brands with the ultimate goals of job creation, build capacity locally, to be ready to sell have not quite become international innovation and technology transfer. It those volumes and tweak your product household names, PAIH’s VP pointed appears that the agency has been just to serve local customers and their difout that there are a number of silent as successful on this front. “2018 was ferent tastes. That all needs new investexport champions driving this growth. PAIH’s best year in terms of investor ment in a company.”

The machinery, automotive parts and support,” said Dr Senger. “Since 2015, He concluded by revealing a new furniture sectors have received their total capital expenditure has increased initiative in the pipeline. “This summer fair share of press lately, but there are from €500m to over €2bn. Last year, we have been testing a new integrated lesser-known product groups leading we exceeded all previous levels, both in system of servicing Polish clients in the Europe in their respective fields – and the number of projects and the value US,” he said. “Within the tested model, in some cases, the world. For example, generated. The following years could a client is serviced by a dedicated Poland is the largest exporter of small be even better.” Overall, total inbound PAIH US office specialising in a parto midsize pleasure and sports water- FDI (stock) increased from $183.9bn in ticular area of the business. For examcraft in the EU with a mega 60% share 2015 to $230.6bn in 2018 (OECD). ple, IT companies will be directed to of the EU export market. The next bigWhile PAIH is still actively court- our experts in San Francisco, while our gest is Finland at 9.1%. Internationally, ing foreign capital for the blue-chip office in Houston will look after energy local shipbuilders are only beaten by sectors (e.g. manufacturing), they are and medical companies.”

FDI in Poland assisted by the Polish Investment and Trade Agency Years

Projects Serviced

Total Value

New Jobs

2000-2018 2018 2019 (Q1+Q2)

800 71 31

€20 bn €2.1 bn €0.723 bn

200,000 19,000 4,100

The Polish Investment and Trade Agency has only been operational

in its current form for about four years and its network of foreign trade offices was only completed in 2018. Therefore, it is difficult to make a proper performance appraisal without a solid body of data to analyse. “It's still an innovative process,” said Dr Senger. “We are looking for the best ways to measure the effectiveness of this set of global office network.” But along with sharing some internal PAIH data, he did shed some light on the areas they are looking at. “In terms of FDI, of course, we are looking for jobs, we are looking for capital expenditures and technology innovation,” he said.

“The same goes for Polish companies going overseas. We need to look for ways to measure, such as the number of deals, the number of new distribution channels opened to our customers, and so forth.”

source: PAIH

FDI invested in Poland

41

work in progress

Polish FDI invested abroad

BUSINESS & ECONOMICS

The inflow of foreign direct investment

into Poland was concentrated in certain sectors. According to the National Bank of Poland, two-thirds of FDI went to three sectors: manufacturing (32.2% of all FDI), finance and insurance (18.8%), vehicle trade and repair (15.3%).

flow of FDI invested in Poland and Polish FDI abroad source: OECD

7.1 -2.6

USD bn

USD bn

2012

2.7 -1.3

USD bn

17.5

4.6

USD bn

USD bn

USD bn

2013

2014

11.8

1.9

USD bn

17.3 13.1 USD bn

USD bn

USD bn

2015

2016

8.6 2.3

USD bn

11.3

0.2

USD bn

USD bn

2017

USD bn

2018

total stock of FDI invested in Poland and Polish FDI abroad source: OECD

238

229

USD bn (43.7% GDP)

USD bn (45.4% GDP)

212

199

USD bn (38.9% GDP)

USD bn (39.8% GDP)

184

USD bn (38.5% GDP)

26.1

USD bn (5.2% GDP)

2012

27.7

USD bn (5.2% GDP)

2013

21.8

USD bn (4.0% GDP)

2014

22.3

USD bn (4.6% GDP)

2015

230

USD bn (39.4% GDP)

186

USD bn (39.6% GDP)

25.4

USD bn (5.3% GDP)

2016

28.5

USD bn (5.4% GDP)

2017

25.0

USD bn (4.2% GDP)

2018

42

BUSINESS & ECONOMICS

After handling the domestic market,

Polish companies are ready to get out of their comfort zone and explore new opportunities abroad.

Navigating unchartered territories can be difficult, but here are examples of businesses which took the plunge and with help from the Polish Investment and Trade Agency (PAIH), they were able to seal the deal.

Europe

north America

north America

Apart / Spain

Ceramika Paradyż / Canada

Trias / USA

Apart, a leading Polish jewellery When Canada’s ceramic tile provider Trias Group, which develops audiomanufacturer, opened its first store Eurcan Tile approached PAIH to help video-light (AVL) solutions for busiin Spain this year. The Spanish market them find a Polish ceramic tile manu- nesses, established Trias International is extremely competitive and favours facturer, the company chose Ceramika after opening an office in the US. local companies, making it difficult for Paradyż – one of the country’s biggest The PAIH trade office in New York foreign brands to make a mark, accord- producers – from a database of poten- helped Trias with its expansion abroad ing to Wojciech Łopatkiewicz, Head tial contractors. In 2018 the two compa- by aiding with administrative proof the PAIH Trade Office in Madrid. nies signed a long-term contract after cedures and gaining local partners.

However, Poland exported nearly 12.6m the Comprehensive Economic and The company, which has been active zł worth of jewellery to Spain in 2018. Trade Agreement (CETA) with Canada for 20 years, is implementing its first After entering the Czech Republic, and the EU came into force. The PAIH American project: the modernisation APART looked to expand into other Toronto office helped both parties of the chain Regal Cinemas which operEuropean markets and contacted PAIH throughout the negotiation process ates 550 movie theatres all over the for advice on how to win over the ini- and assisted them with the application US. Trias is responsible for the instaltial business contacts in each targeted of CETA regulations. In line with the lation of custom-shaped LED screens market. Piotr Rączyński, President of contract, Eurcan Tile will be the main connected to a Digital Signage system. the Board of APART, said the trade importer and distributor of Ceramika The Polish company started the modoffice presented the brand as a “reli- Paradyż tiles in Canada and the US ernisation project with a cinema located able business partner and promoted in what is one of the first agreements in Manhattan, New York. Zbigniew its activities in Spain,” making it easier of its kind between Polish and Canadian Klonowski, President of Trias, said the to implement their plans for the local companies. Since its foundation in 1989, company has been at the forefront market. PAIH’s office in Madrid began Ceramika Paradyż has developed its of the Polish AVL sector for nearly two operations in 2018 and since then, it has own recognisable style, which is char- decades. Trias introduced the first LED supported over 370 companies, mostly acterised by bold design, refined details screens to the country 18 years ago and from the food, cosmetics, furniture and and the availability of various types specialises in equipment rental, fixed installations and services for global interior design industries. of tiles within individual collections. brands and institutions.

by Monica Zielinski

43

44

BUSINESS & ECONOMICS

middle east

asia

africa

Grenton / Saudi Arabia

Lino / Japan

Automotive sector / Senegal

Grenton, a producer and distributor of Lino, a producer of linen clothing and The Polish automotive sector is thrivsmart home solutions, strengthened textiles, extended its offer to clients in ing in Senegal, a country which imports its position on the Arabian market by Japan. The owner, Daria Wysocka-Zajul, 100% of its cars and automotive parts. signing a partnership agreement with said she contacted PAIH offices abroad According to the PAIH Foreign Trade a leading Saudi distributor. The innova- to broaden their reach. Tokyo took the Office in Dakar, Senegal may become tive company first focused on expan- call and it turned out to be a good fit one of the most attractive export marsion in Western Europe before taking because the Japanese have a penchant kets for the Polish automotive industry, its home systems – which control all for flax, and recycling is important - especially manufacturers of auto parts aspects of the building from heating, according to the Japanese philosophy and accessories. The automotive marlighting, ventilation and multimedia – to of wabi-sabi lifestyle. After Lino sent ket value in Senegal is $100m and about the Middle East. In 2018, Grenton part- the PAIH trade office some bestsellers, 100,000 vehicles are imported to the nered with Dubai’s Kromtek Systems a Japanese company showed interest country every year – mainly SUVs and to distribute its solutions and mod- in their products such as bread baskets, pickups, which require the constant ules for homes, villas, apartments and sheets, and kimono-type blouses. Eliza replacement of parts due to the difficult commercial buildings. Another export Klonowska-Siwak, Head of the PAIH climate and infrastructural conditions. destination is Saudi Arabia where the trade office in Tokyo, said nearly 20% The biggest problem is the lack of availsmart home market is the largest on of Polish clothing and textiles exports ability and quality of products in the the Arabian Peninsula with an esti- to Asia are sent to Japan and high- country, which is why it’s a great marmated value of $305m, said Natalia quality linen is a great export prod- ket for Polish companies. Leszek Biały, Zimny, Business Development Manager uct. She added that flax, which has Head of the Foreign Trade Office in at Grenton. This year, with support the natural properties of a breathable Dakar, said Poland can offer European from the PAIH office in Riyadh, Grenton fabric, is an excellent replacement for quality at a decidedly lower price. PAIH made a deal with the Saudi Al-Alameya disposable plastic bags and the mate- offers support instruments for expanGroup, which is one of the leaders in rial is perfect for Japan’s moist and sion into the African market, such as integrated solutions for security sys- hot summer climate. insurance and financing, which is espetems and a contractor in the public and cially important for SMEs. private sectors.

by Monica Zielinski

45

46

Poland Today caught up with the head of the Warsaw Stock Exchange, Marek Dietl, to talk about market trends in the region and a few innovations arising from the exchange.

photos: Alina Gajdamowicz (Bind Up Photos), Bartosz Stefaniak

BUSINESS & ECONOMICS

Direct from the trading floor

It has been

Foreign journalists

had a chance to talk to Marek Dietl oneon-one at the Warsaw Stock Exchange during the International Media Tour organised by Poland Today.

For more about the tour, see page 71.

a rocky year for capital markets around the world. The US-China trade crisis has whipped up global headwinds while an EU-wide downturn and a “tsunami of regulations” in the EU have made for interesting times for Europe’s stock exchanges, so says Marek Dietl, President of the Management Board at the Warsaw Stock Exchange (Giełda Papierów Wartościowych: GPW). “We have seen a decreasing number of listed companies worldwide,” he said, touching upon the trend of companies turning to venture capital and private equity for financing rather than IPOs. “But for the top-listed companies, we have seen an increase in market capitalisation vis‑à‑vis GDP.” FTSE Russell upgraded Poland to developed market status last year and according to Dietl, the move has produced varying results for different sized Polish companies. “The 37 companies on our market, which are in this All Cap developed index, saw their trading volumes increase and they can access practically an unlimited pool of capital,” he said. He made special mention of gaming stocks (e.g. CD Projekt) and retail stocks such as the Dino group, which operates more than 1000 grocery stores around Poland. Since its float in April 2017, it has seen its market capitalisation grow by 200% and stock

quickly make the WIG20 index, which comprises the top 20 companies listed on the exchange.

But the upgrade has also resulted in a more competitive environment with the capital pool tilted towards the big end of town at the expense of companies at the beginning of their growth cycle. In fact, Dietl suggested that the previous conditions may have been more favourable to smaller companies as “the emerging market funds are less picky when it comes to liquidity and capitalisation than the developed market funds”. But he did emphasise that these companies can still profit from their access to the MSCI Europe Index that represents both large and mid-cap equities across the 15 developed markets in Europe.

The change in status has naturally broadened the net of capital and now the WSE finds itself engaging with investors less versed on the dynamics of the Polish market. Dietl said that the WSE takes a layered approach to introducing foreign investors to the local markets and companies. “First, we have to sell Central Eastern Europe and explain that it's as stable as the European Union but with more positive growth rates,” he said. “We have to then focus on Poland's macro story, which is excellent. And then the particular companies or indexes. That's

‘We cooperate very closely within the CEE because, first, it's about selling the region’

why it's very important that we cooperate very closely within Central and Eastern Europe because, first, it’s about selling the region.”

This September at the Economic Forum in Krynica Zdrój, the WSE launched the Three Seas Exchanges Index, which draws together 100 of the most liquid stocks listed on CEE exchanges, including Bratislava, Bucharest, Budapest, Ljubljana, Prague, Warsaw and Zagreb. With a 50% share, the WSE is responsible for the calculation and publication of the index. “It's mainly designed for East Asian investors,” Dietl said. “For example, why should a Chinese investor in Hong Kong invest in a market like Poland, which is half the size of one Chinese province and 15,000 km away? With this index, it's much easier for them to digest the idea of investing in companies from a collective of five countries with a very strong macro story.”

Poland’s highly diversified business landscape presents the WSE with unique challenges. Only 0.2% (3,296) of Polish companies are considered large enterprises (250+ employees), contributing 48.6% share of GDP, and just 432 of them are currently listed on the exchange. As a result, the WSE runs an alternative exchange called NewConnect to service the next biggest segment of companies: the estimated 15,000 mid-sized firms (50-249 employees). This multilateral trading facility allows these smaller companies to float shares without the same entrance costs and reporting requirements as the standard exchange.

Dietl also talked about the WSE’s foray into the tech world. Along with the development of a blockchain platform for clearing and settlement, the WSE has created an R&D centre, which is developing a medium-sized exchange platform. “We are designing a system especially for small exchanges. The systems designed for larger exchanges are simply too big and too expensive for smaller exchanges, which limits their competitive edge,” he said. “We want to make our platform very light, flexible and customisable for different markets.

So hopefully we'll have a system to be used in some countries in the Kazakh region, Central Eastern Europe and also in some Arab countries.”

47

48

Celebrating 90 years of business, LOT has dug itself out of dark times and is now a leader in the CEE region’s air travel market, flying to over 100 destinations worldwide.

photos: Alina Gajdamowicz (Bind Up Photos), LOT Polish Airlines

BUSINESS & ECONOMICS

Clear skies for expansion

Ten years ago,

Rafał Milczarski

is the President of the Board of LOT Polish Airlines. He has also served as the President of the AIRiE Association (Airlines International Representation in Europe) as well as the Polish Aviation Group. Previously, he co-founded Baltic Rail, one of the first private railway carriers of goods in Poland and founded Freightliner PL and its German subsidiary.

LOT Polish Airlines was nose-diving into financial ruin, with just 18m zł left in the bank. When Rafał Milczarski came onboard as CEO, he had a mountain of problems to deal with, but with his private sector experience and strong knack for making deals, the company started to take off. Today, LOT is one of the fastest growing airlines in the world, now operating two transport hubs in Warsaw and Budapest.

The state-owned airline had reported losses every year between 2007-2012, forcing it to ask the Polish government for €200m to avoid bankruptcy. The EU approved the rescue plan in 2013 under the condition that the airline would restructure to consolidate its natural competitive advantage. In compliance, the company had to terminate operations between mid-2014 and the end of 2015 on a number of routes and to trim costs to regain its long-term viability.

The new strategy for long term growth was prepared in 2015. The financial aid bumped the airline out of the red, and in 2016 its profits rose to over 200m zł – a small sum compared to the loan, but a step in the right direction.

So what accounted for this rapid turnaround from crisis to expansion?

Under the direction of newly elected President of the Board, Rafał Milczarski, LOT announced in 2016 its new strat-

egy which focuses on profitable growth and aims to become the leading airline in Central Eastern Europe. By taking advantage of the dynamic market in the region, LOT developed a strong network of connections and strengthened its position in the air travel industry. Last year, the airline transported nearly 9 million passengers – an increase of two million since 2017 – across 111 connections worldwide, including direct longhaul, short-haul and domestic flights.

At this year’s International Media Tour hosted by Poland Today, Milczarski said he needed to “change the mentality of the company from doom and gloom and failure to the mentality of the winner, which was not easy.” Coming from the private sector as an entrepreneur in the railway market, he knew how to get results. “If you want to be successful, you have to be willing and able to devote your attention and time, sometimes to the nitty-gritty details – and the results were outstanding,” said Milczarski. Paying attention is imperative when negotiating deals for aircraft acquisitions, he continued, especially when it comes to asking for a better price: “I inspired my people not to be ashamed. If I’m not ashamed to ask if something can be cheaper, they must not be ashamed either. And I always ask for a cheaper price for good quality. I’m absolutely proud of it.”

In line with its strategy, the carrier has added 65 new routes and has expanded its fleet by more than 40 aircrafts, bringing the total up to 90. This September, a brand new LOT-operated Boeing 787-9 took off from Delhi to Warsaw, launching the new transcontinental long-haul flight which will now operate five times per week to LOT’s 6th Asian destination. Considering almost 9.5 million passengers travelled between India and Europe during the

last 12 months, the airline jumped on the opportunity to cater to this market. But other factors also contributed to this strategic decision – India is one of the largest markets in Asia for Polish businesses. According to LOT, Poland is an important investment market for India, such as in the IT sector, and a gateway to all countries within the European Union: “The new connection is a key element in strengthening economic ties and developing business relations between the two countries.”

While expanding its network of connections from Budapest, LOT announced it will launch flights from Hungary, marking another stage of market consolidation. Starting with non-stop flights to Seoul, plus six new European destinations in March, LOT will operate 12 routes from Budapest. Jost Lammers, CEO of Budapest Airport, said, “This development of the route network of LOT’s base in Budapest will strengthen Hungarian ties in business and tourism within and outside Europe.”

Back home, Milczarski supports the government’s plan to build the Solidarity Transportation Hub. He said this is one of the best infrastructure projects in Europe at the moment. “Once they overcome the regulatory hurdles and the master planning, investors will be killing to get involved,” he added.

by Monica Zielinski

‘Last year, the airline transported nearly 9 million passengers across 111 connections’ lot polish airlines LOT is one of the world’s oldest airlines still in operation. Established in 1928,

the Warsaw-based company has 90 aircrafts in its fleet and flies to over 130 destinations across Europe, Asia and North America. Most of the flights take off from its hub at Warsaw Chopin Airport but the Star Alliance member plans to expand once the Solidarity Transport Hub is built which will integrate air, rail and road transport.

Gdynia Gdańsk

Słupsk Koszalin

Suwałki

Giżycko Olsztyn

Szczecin

Łomża

Bydgoszcz Toruń Gorzów Wlkp.

A rail revolution is coming

Łódź Sieradz

Radom

Lublin

Wrocław Wałbrzych

Opole Nysa

Częstochowa

Zamość

Kielce

Stalowa Wola Katowice Kraków

Tarnów

Rzeszów

Nowy Sącz

Travel times between Warsaw & other cities

100 km

city

current time

planned future time

planned Solidarity Transport Hub (STH)

Gdańsk Gdynia Słupsk Płock Toruń Bydgoszcz Koszalin Olsztyn Ostrołęka Łomża Giżycko Białystok Suwałki Lublin Zamość Radom Stalowa Wola Rzeszów Kielce Tarnów Nowy Sącz Katowice Kraków Częstochowa Opole Nysa Sieradz Wrocław Wałbrzych Poznań Szczecin Zielona Góra Gorzów Wlkp.

Kutno

2h 56 3h 22 4h 35 2h 32 2h 41 3h 21 5h 15 2h 43 2h 01 no line 4h 34 2h 18 4h 45 2h 55 6h 28 1h 59 5h 48 4h 03 3h 06 3h 21 5h 50 2h 22 2h 20 1h 58 2h 52 4h 48 2h 37 3h 35 4h 33 3h 32 6h 32 5h 30 6h 09 1h 22

2h 05 2h 30 3h 20 45 mins 1h 30 1h 50 3h 40 2h 00 1h 05 1h 25 2h 15 1h 15 2h 30 1h 30 2h 10 1h 00 2h 00 2h 15 1h 10 2h 15 3h 00 1h 30 1h 30 1h 50 2h 45 3h 15 1h 10 2h 00 2h 45 1h 55 3h 15 3h 35 2h 40 55 mins

new high speed railways existing railways planned for upgarde

Polish cities by size of population: > 1,000 thousand 700-1,000 thousand 500-700 thousand 400-500 thousand 300-400 thousand 200-300 thousand 150-200 thousand 100-150 thousand 50-100 thousand < 50 thousand

photos: Lukasz Dejnarowicz (Forum), Alina Gajdamowicz (Bind Up Photos)

Secretary of State and Government Plenipotentiary for the Solidarity Transport Hub, presented the project to international business journalists during Poland Today’s media tour. For more about the tour, see page 71.

Warsaw Kutno

Zielona Góra

With dazzlingly futuristic designs

Mikołaj Wild,

Płock

Poznań

If the airport is to be the heart of the planned transport hub, the rail links will be the arteries which will enable passenger flow around the country. for Solidarity Transport Hub (STH) submitted by international architectural houses, it’s the airport which has grabbed the headlines so far. But Poland’s plans for a complete revamp of the nation’s rail system is arguably even more transformational in its potential effect on Poland’s economic future.

The nationwide rail system envisages 1600 km of new high speed rail and 2400 km of upgraded existing rail lines to be built by the year 2040. The initial phase will be the construction of a 140 km stretch of high speed rail linking Warsaw, STH and Łódź (Warsaw - STH in 15 minutes, Łódź - STH in 25 minutes).

The idea is to better connect not only Poland’s major urban centres with each other, but its smaller towns to those cities – all leading to the STH. In real terms, it would mean that someone living in a town like Suwałki in the north-eastern corner of Poland and four hours 45 minutes away, could comfortably get to Warsaw and back in a day, and a worker in Kielce, currently over three hours away, could commute to Warsaw in one hour and 10 minutes. If the government can carry this out, it would be the catalyst to another step in Poland’s economic development.

Białystok

Ostrołęka

50

BUSINESS & ECONOMICS

Black pearls bred in Warmia In the rarified world of caviar, Poland is a bigger player than might be expected. And this comes down to just one company located in the idyllic surroundings of a nature reserve. Too good to be true? Except it is.

Poland isn’t a country that is nec-

photos: Antonius Caviar

Iran. Today the opposite is true, in that essarily associated with caviar in most caviar now comes almost exclusively people’s minds, but in fact it’s home from farmed sturgeon and the market to one of the world’s great caviar pro- has opened up to include many more ducers. And it’s not just that Antonius countries. Poland is one of these, and Caviar comes from Poland which marks Antonius Caviar punches above its the company out from other global weight as the only significant caviar proproducers. “We don’t only produce the ducer in the country. In 2016 – accordcaviar, but we also breed the sturgeon ing to figures from the 8th International from which the caviar comes,” says Sturgeon Symposium in Vienna in 2017 Agata Łakomiak-Winnicka, the compa- – the company produced 15 tonnes, the ny’s sales and marketing director and same as Germany’s eight producers Richard Stephens daughter of the company’s founder, the managed collectively, and significantly is editor of Poland Toeponymous Antoni Łakomiak. Together more than the seven tonnes produced day, which he founded with Agata’s brother Szymon, the three by 10 companies from Hungary, Latvia, in 2012. He also organrun the company’s operations.

Holland and Switzerland combined. izes, runs and moderates conferences on The legal global caviar market Antonius estimates production of 25 a variety of topics in is around 400 tonnes in volume, with tonnes in 2020, which will place it third Poland and abroad.

Antonius Caviar producing about 5% of in Europe after France (est. 41 tonnes, He was previously edithat total. In the past, caviar came almost ten producers) and Italy (est. 40 tonnes, tor of Eurobuild CEE magazine and founded exclusively from wild sturgeon, particu- six producers). Globally, the biggest the Eurobuild Awards larly from the Caspian Sea, and the mar- producers are China (est. 100 tonnes, Gala event. Richket was largely controlled by Russia and six producers), Russia (est. 60 tonnes, ard has a degree in fifteen producers) and the USA (est.

Theology & Religious 45 tonnes, ten producers). To say Studies from Bristol University in England. Sturgeon that Antonius Caviar is a heavyweight amongst global caviar producing comThese archaic giants of the water face nupanies is an understatement. merous threats to their survival. Despite being on Earth for millions of years, sturgeon are now Agata’s father, she says, is passionvulnerable to overfishing and interference in ate about fish: “He is a breeder – he has their natural habitat. According to the IUCN, spent his life with them.” According sturgeon are "more critically endangered than to the company’s website, “Antonius any other group of species.” Termed ‘living fosCaviar is the result of many years of sils in danger’ by the WWF, Sturgeons tend to have long lives – the oldest recorded live to over work on breeding sturgeon and pro100 years of age – and can grow to up to 5.5m. ducing caviar. The brand belongs to

Gosławice Fish Farm located in Konin, which has been breeding fish since 1967.” Including its subsidiary farms in Olsztyn and Lubicz (near Toruń), Antonius manages an area of approximately 2700 hectares.

It was in 1992 that Antoni and his colleagues started looking at ways to enlarge the company’s operations, and decided to introduce new fish.

Sturgeon was one of them, but initially only for the meat. A few years later Antoni started traveling around Europe, visiting different fish farms, and decided that Gosławice should change tack and breed sturgeon for caviar too. “Our fish farm was famous in Poland for being the best,” claims Agata, “so the caviar had to be amazing.” Antoni set about gathering a group of people dedicated to this new task. “We created a team of passionate people – people who can work even 20 hours a day. Fish don’t take a day off, so neither can we,” she says.

Fish farming, she stresses, is not just a case of putting fish in a pond and waiting. “Rearing sturgeon is a very complex operation because the fish are sensitive. There are so many factors that affect them – the temperature of the air, the temperature of the water, the oxygen in the water, the air pressure – many things. If you overfeed them when it’s too hot, for

‘Rearing sturgeon is a very complex operation because the fish are sensitive’

51

caviar Caviar is the unfertilized salt-cured eggs

BUSINESS & ECONOMICS

of sturgeons. Often dubbed ‘black pearls’, they are in strong demand around the world, making the caviar industry a much more lucrative one than most forms of fishery. Because they reach sexual maturity relatively late, sturgeon are vulnerable to overfishing, and there is a robust illegal caviar trade. China, the Russian Federation and the USA are the largest caviar exporters with Switzerland, France and Germany the biggest importers.

example, they will die.” Then there are the different ages of the fish – a very important part of the equation when it comes to sturgeon. “Until they are three to four years old we don’t know if they are male or female. Once we know – using sonar – the females are sent to the breeding facility. Sturgeon can produce caviar starting at eight years of age, but only about 5% do.

Around 10-15% are ready at the age of nine. Sometimes they are only ready at 12 or 13 years old,” she says.

The area and environment in which the sturgeon are bred is of huge importance. “We take our water from the Łyna River, which borders the NapiwodzkoRamucka Forest. There’s no industry there. Chefs and buyers from around the world visit us and they see that we are not just a marketing story – they see that we really are what we say we are, which is an entirely natural producer.”

Are their visitors surprised? “Yes I think they are,” she says. “They are also surprised about Poland – when we meet them at the international trade fairs we sometimes have to explain that we’re located between Germany and Russia.

But once they come, the chefs – many of whom are Michelin-starred – are impressed.” In today’s world, where immediate results are expected, the eight-or-more year wait for the sturgeon to produce roe is an anomaly, and

some producers try to hasten the process with the indoor system, a system in which the sturgeon are fed all year round and the temperature of the water is kept high. “But the fish need time to build the vitamins and the omega-3,” says Agata. “In our opinion, the most important element for producing the quality and taste of caviar is to reflect nature, so all our three farms are opensystem, using natural free flow waters from Polish rivers. We feed our sturgeon by hand and make a break in the ply because they are a Polish producer, winter, just like in nature. In the natu- says Agata. Their caviar, she states, is ral environment sturgeons migrate served in the best Polish restaurants. because at different ages they need dif- The company’s most expensive caviar ferent conditions. That’s why we have is Oscietra, harvested from females three farms, not one.” of up to 15 years of age. The price is The biggest markets for Antonius about €2000 per kilo, which is about Caviar are western Europe, the UAE and €60 for a 30g tin in the retail market. the USA. At present Poland provides In this regard, this little delicacy from only a fraction of global demand, but Poland is also one of its most prestigit is an important market for them sim- ious exports. by Richard Stephens

BUSINESS & ECONOMICS

The Fourth Industrial Revolution is no longer a concept but a reality in Poland. But how are local companies negotiating the new tech frontier and what is the government doing to help?

Nick Westerby

is a Warsaw-based journalist who has covered a variety of topics including sports, medical innovation, the construction sector, new technologies, the economy and Polish start-ups. He graduated from Leeds Metropolitan University with honours in sociology and psychology before moving into finance. He previously worked in Greece and South Korea before settling in Poland.

The 4th Industrial Revolution Characterised by a fusion of technologies,

the 4IR blurs the lines between the physical, digital and biological spheres. It’s built on the third revolution which used electronics and information technology to automate production.

Technologies driving this revolution include artificial intelligence (AI), robotics, the Internet of Things (IoT), 3D printing, genetic engineering, and quantum computing, among others.

In Poland, just as everywhere around the world, mass production is giving way to niche – sometimes even tailored – individual production, at a faster pace than ever before. The rise of 3D printing and ‘batch-size-one’ production is ushering in the fourth industrial revolution, and those who have embraced it are stealing customers and market share from those who still don’t know what it means. The government has taken an active role, with the Ministry of Entrepreneurship and Technology offering 30m zł in investment to Polish companies to help them become leaders in Industry 4.0. "We must do everything to find ourselves among the leaders of countries and leaders of economies using artificial intelligence because there is no turning back from the applications of AI in all sectors of the economy,” announced Marek Zagorski, Minister of Digital Affairs, this September at the ‘Dimensions of Artificial Intelligence’ conference (NASK) in Warsaw.

In 2016 the European Union defined Industry 4.0 as “the organisation of production processes based on technology and devices autonomously communicating with each other along the value chain: a model of the ‘smart’ factory of the future where computer-driven systems monitor physical processes and make decentralised decisions based on self-organisation mechanisms.” Others extend the definition to include services and administrative processes that have been automated.

A collaboration between two tech startups, PIRXON and Antal, created Poland’s first robot job agency this year. These ‘digital employees’ are now used to handle repetitive and tedious activities, freeing up human employees to do more demanding or creative tasks. Boniface, the robot created to help search for candidates, works efficiently, shortening the recruitment process by one third, according to PIRXON. “A digital employee has many advantages: it does not make mistakes, take a holiday or get sick, and can work 24 hours a day,” said Artur Skiba, President of Antal. “Furthermore, by taking over repetitive and high-volume processes, robots enable the development of employees in more advanced areas of the company’s operations.

They reduce the risk of errors, but most importantly, they allow the company to focus on additional activities."

PIRXON has also worked in the industrial sector with lighting producer Lumileds, creating a robot worker to process invoices. This time the robotic process automation (RPA) saved the company 80% in costs and the company was able to increase invoice generation from 60 invoices to 200 per day. It is these savings and productivity

illustration: Mustafa Hacalaki

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Is Poland at the vanguard of Industry 4.0?

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gains that will allow Industry 4.0 to help ous use of automation, data exchange phase to the next. It isn’t just Polish proSMEs to compete at home and abroad. and processing, and production tech- ducers who are investing in these sysNot everybody is so optimistic. nologies leads the Wiśniowski brand tems in this country; some of the world’s As Julia Patorska of Deloitte warns: towards creating a ‘smart factory’ biggest companies, such as Bosch, BUSINESS & ECONOMICS “Polish industry is fragmented. We lack where the systems autonomously make Kuka, ABB, Comarch and Siemens, are large enterprises with significant cap- decentralised decisions regarding pro- all investing in Industry 4.0 solutions ital, where more is spent on research duction and control all the related in Poland as well. and development, and economies of processes, while at the same time comSiemens has begun implementing its scale significantly increase productiv- municating with humans and each other Mindsphere programme, which Łukasz ity. Technological advancement issues in real time. It is a revolution of sorts.”

Otta, Digital Transformation Director for can be another barrier. Deloitte's surSiemens Poland, describes as “a softvey on the maturity of the start-up Code doesn’t take a <br>eak ware tool that provides secure data ecosystem also confirms the distance There is a growing infrastructure of ser- acquisition, processing and storage in that we share with leading economies vice companies dedicated to helping the cloud. Acquiring a large amount in this area. Poland is not yet ready for manufacturers achieve these smart of information about production prothe Fourth Industrial Revolution. It is factories and integrate automated cesses, machine status, inventory, comforting that in many other markets solutions. “The pinnacle of Industry including raw materials for production, 4.0 is a lights-out factory or logis- energy costs, availability of personnel Industry 4.0 is also just beginning.” tics centre. Such installations already and other information opens the way to Factories of the future exist in Poland – Amica’s warehouse very specific innovations and improveOne leading company that has built near Wronki is fully automated,” said ments in the operation of the company.” a state-of-the-art facility in Poland Tomasz Deptuła, Project Manager and In a 2018 Deloitte report, Dominika is Amica. At 46.5 metres high, 136 Site Leader at deepsense.ai. “There Bettman, CFO Siemens Poland, metres long and with a surface area of is no need to transport a workforce to summed up the challenges of implenearly 6,500 sqm, their high bay ware- a distant location and provide heating menting Industry 4.0 in the country: Emerging cities, house in Wronki, Wielkopolska, is one or cooling. Even the light in a ware- “The economy in the era of the fourth according to World Economic Forum of the biggest in Europe. It can store house is obsolete: automated machines industrial revolution needs staff that will experts, have a 230,000 large household appliances don’t need to see anything, nor do they meet the challenges of its modernisa- promising future and the automated steering system get cold or faint in the heat. Machine tion and digitisation. A contemporary - – if they can intelis capable of processing about 1,600 learning models can optimise energy and even more future - engineer will be ligently harness the rapid and disruptive items per hour. After winning an award use and other utilities to make the characterised by a specific set of skills, technological change for ‘Innovation in Industry 4.0’ for the remote location easier to maintain or combining fields such as mechatron- of the Fourth Indusfactory at the International Intelligent even semi-autonomous. That reduces- ics or IT with the ability to understand trial Revolution (4IR).

Development Forum 3.0 Marcin Bilik, costs significantly.” all technological processes specific Poland Today will further explore this This solution also allows companies for individual production industries.

Vice President of Amica, said: “As a protopic at its ‘Emerging ducer of household appliances, which to reduce property costs by locating Therefore, Polish industry needs new Cities & 4IR’ confersells in 60 countries around the world operations at cheaper regional sites staff with interdisciplinary compe- ence in Bydgoszcz and exports 70% of Polish production, away from the main population cen- tences. In our opinion, the group that on 21 November 2019.

To register go to we must be technologically and pro- tres. “Making a facility controllable deserves special attention, especially in www.poland-today.pl. ductively innovative, and take on the from remote locations enables a com- the context of the need to combine difchallenges associated with Industry 4.0. pany to get support from numerous ferent areas of knowledge, are students, Without this, with the competition that experts who are unwilling to move near or future engineers.” characterises our industry, we would the factory, with semi-autonomous Further along the logistics chain, not have any chance.” facilities, most of the work can be done another Polish company, Nova Tracking, Nowy Styl, the Polish furniture remotely – from a single office located has created modern solutions to help manufacturer, has embraced the idea in a city or even from an expert’s home freight forwarders, carriers and shipof batch-size-one production at their anywhere in the world,” added Deptuła. pers to optimise their processes and modern factory in Jasło, a small town “Combining low-cost facilities with sup- build a market advantage. “We are in the South-East of Poland. Batch- port from experts around the world is focusing on the digitalisation of transsize-one production refers to the the perfect combination.” port and logistics documents as well ability of a manufacturer to produce WObit, a Polish producer of auto- as the automation of steps in business a small number of items for costs simi- mated guided vehicles – or AGVs – has processes,” said Dr. Marcin Hajdul, CEO lar to a large run of products. Nowy won awards for its range of prod- of Nova Tracking. “Automation means Styl is recognised as one of the lead- ucts. These robots already operate in that our platform generates different ing manufacturers in Europe, supplying warehouses and when combined with types of documents, writes and sends chairs to sports stadiums and even to smart pickers or co-bots (collaborative emails, connects to external systems a G20 conference, and is an example robots), the modern factory begins to in order to get all the required data. of a family-run company based outside look more like a ballet as the smooth All of our users can work together a major metropolitan centre that has processes flow seamlessly from one within a NovaTMS ecosystem. Small and embraced automation and achieved medium-sized transport companies using NovaTMS can save up to three success in a modern way.

Wiśniowski, a manufacturer of gates, and a half hours daily per person.” fences and doors based in the small The 4IR won’t happen by accident: southern town of Wielogłowy, has also companies, governments and univerbeen a pioneer in Poland. “In 2004, we sities will all have to work together to managed to develop the Industry 4.0 build an environment and infrastructure standard without any outside assistance where possibilities turn into realities. The time for thinking about this as something and we currently consider ourselves to be experts in the field,” said Tomasz for tomorrow has passed; the Fourth Długopolski, Technical Development Industrial Revolution has already begun.

Director at Wiśniowski. “The simultaneby Nick Westerby

‘Automated machines don't need light, nor do they get cold or faint in the heat’

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BUSINESS & ECONOMICS

Monica Zielinski is Poland Today’s online editor and social media manager. She is a Polish-American with a journalism degree from Southern Connecticut State University in the US. She moved to Warsaw in 2016 to reconnect with her Polish roots and work in her field.

She recently earned a master’s in English Studies at the University of Warsaw.

Supplying the supply chain sector When students score low on professional preparedness, initiatives that provide real-world experience may be the key to bridging the gap between business and academia.

Positioned in the centre of Europe with expanding warehouse space and competitive offers, Poland is becoming a leader in the logistics sector. But how can the supply chain industry ensure it has a trained, innovative workforce that’s ready to tackle the challenges of tomorrow? PSML (Polish Supply Management Leaders), a non-profit organisation, aims to prepare the next generation of industry professionals through its programmes for students and young talent. PSML represents the interests of Polish supply chain, logistics and procurement managers, with a mission to build a centre of competence in Poland in the area of supply chain in the European market. More recently, the organisation introduced two initiatives: CloudNine and Top Young 100, which are dedicated to providing a fresh set of supply chain specialists.

Creating a dynamic link between business and academia is one step toward building stronger practical learning and development models, according to Mariusz Gerałtowski, President of the Board of PSML, and the first opportunity for collaboration is the university thesis. According to a 2019 survey by PSML, almost 400k graduates annually spend collectively approximately 100m hours working on their theses, of which 80% have no practical use. Instead, students

are advised to choose practical issues which can benefit businesses. A talented student can provide a different perspective and interesting ideas which have not yet been explored internally. With the CloudNine programme, participating businesses submit potential topics and students from nearly 40 universities across Poland will have the opportunity to write a winning thesis based on these topics. A committee chooses finalists who then have to defend their thesis during Industry Week at the Ptak Warsaw Expo and the audience picks the winners. “The dynamic technological progress will require new skills from businesses and employees, but we do not know what those requirements will be. Therefore, when business takes on an active role in the education process, we will help utilise the time that the student spends in university,” saidGerałtowski.

Similarly, Project Top Young 100 connects students in supply chain management and aims to support young professionals as they enter the market to promote Poland’s image as a strong player in European logistics. Teodor Kula, Board Member of PSML, said carefully selected students are enrolled in a comprehensive programme which provides highly valuable exposure to authentic challenges from within the profession. “These people

According to Mariusz Gerałtowski, President

of the Board of PSML (pictured below), creating a dynamic link between business and academia is one step toward building stronger practical learning and development models.

‘We would like to encourage young people to build their careers in the Polish market’ are able to build and maintain a passion for the profession, as well as develop confidence in their own potential as they begin to look beyond their studies,” said Kula. He added that adapting to the world of work can be challenging at first and that there’s a large gap between what formal education can offer students versus what is required by businesses. “We would also like to encourage young people to build their careers in the Polish market by showing them its strength and assure them that they can indeed thrive and prosper in this country, a country which has many logistics opportunities and advantages,” added Kula.

For one year, top students participate in workshops to solve real challenges, conduct market research, design supply chain processes, develop analytical tools and propose new concepts for development. Students work on projects from conception to delivery and attend training seminars about professional know-how, soft skills and other competencies under the guidance of experienced managers. The programme evolves with market trends and creates new challenges to provide incoming students with a wide range of opportunities to expand their knowledge and test their skills. Top Young 100 is a win-win for both students and the industry, as Kula explained: “Being able to sample a range of experiences will empower the students to gain a more intimate understanding of their ideal future pathway within the sector.

Our partner businesses gain access to the best young talents and this is a clear benefit.” As a result of participating in the CloudNine programme, Kula added, “The companies will increase their competitiveness in the supply chain industry on the European or even global scale.”

by Monica Zielinski

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CONFERENCE & COCKTAIL PARTY

EMERGING CITIES & 4IR

Showcase Bydgoszcz: how smart technologies are accelerating development in tomorrow’s cities

21 November 2019, Słoneczny Młyn, Bydgoszcz

Emerging cities, according to World Economic Forum experts, have the potential to offer a sustainable future – if they can intelligently harness the rapid and disruptive technological change of the Fourth Industrial Revolution (4IR).

How does it apply to Poland's emerging cities?

Registration and more information: www.poland-today.pl

STRATEGIC PARTNERS

The event is co-financed from the funds of the Regional Operational Program of the Kuyavian-Pomeranian Voivodeship for the years 2014-2020 and from the budget of the Bydgoszcz Regional Development Agency

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Emerging cities

Emerging cities

Punching above their weight Twelve metropolitan areas generate 55% of Poland's GDP, according to PwC's 'Report on Polish Metropolises 2019'. Among the 12 are Bydgoszcz, Lublin and Rzeszów.

With the exception of Rzeszów, which

has long enjoyed international recognition as a centre of investment, the cities of Bydgoszcz and Lublin have perhaps emerged a little later onto the radar of international investors and businesses than the heavyweights of Gdańśk, Kraków, Katowice, Łódź, Poznań and Wrocław. But they are more than making up for this with their energy, ambition and speed of development. All three share some similarities – they are each, for example, recognised centres of higher education – but they also have their unique attributes. Of the three, Bydgoszcz is the leader in service centres, with 41 BPO, SSC, IT and R&D centres, making up 3.4% of the national total, according to ABSL. Lublin has a 2.4% share and Rzeszów 1.7%.

Lublin is a leader in attracting international students, with almost 6500 foreign students calling the city their academic home in 2018 – around 10% of the national figure. And Rzeszów is a European IT powerhouse and the home of Aviation Valley. In the second part of our series on Polish cities, Poland Today takes a look at these three tier-2 cities of the future.

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Emerging cities

City of bydgoszcz Population within administrative borders: 350,000 Unemployment rate: 3.6% Average gross salary: 4,185 zł/ € 973 Institutions of tertiary education: 10 Students in tertiary education: 29,000 Rafał Bruski, Mayor of Bydgoszcz:

Nation of Cities

Bydgoszcz also offers a highly valued work-life balance – a space for family life and realisation of personal passions. The city is attracting more and more investors and tourists, but at the same time it makes sure that it remains a friendly place to live in. Bydgoszcz is an important business and academic centre, but also a city of culture and sport. It is the greenest city in Poland, where hundreds of residents and tourists are actively using numerous green areas and forest complexes, the charming space of the Mill Island in the heart of the city, as well as the biggest city park in Poland "Myślęcinek".

The city’s openness, convenient transport location, high potential of human resources, market oriented education system, access to a wide range of investment areas and modern office space, as well as professional support for investors from the local authorities – are the key factors placing Bydgoszcz among the most attractive locations in Poland for developing business. Also numerous awards and distinctions for the city in international competitions and business rankings are proof that it is worth to invest in Bydgoszcz.”

The three granaries in Grodzka

Street (above), located on the Brda River right next to the Old Market Square. These buildings are the official symbols of the city and now house exhibitions of the city’s Leon Wyczółkowski District Museum.

photos: Municipality of Bydgoszcz, Leonid Andronov, Robert Sawicki, Marek Maruszak, Pit1233 (Wikipedia)

“Bydgoszcz is successfully changing its image from an industrial centre to a centre of modern technologies and services. Industrial heritage is an important element of the cultural landscape of Bydgoszcz and creates a context for discovering the contemporary character of the city, including the development of Bydgoszcz enterprises, creative industries, modern technologies and production. Inhabitants of Bydgoszcz are passionate professionals, pursuing various projects on a global scale. They are also business leaders whose open minds and creative approach allow them to dynamically develop the local economy.

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The article is co-financed from the funds of the Regional Operational Program of the Kuyavian-Pomeranian Voivodeship for the years 2014-2020 and from the budget of the Bydgoszcz Regional Development Agency.

Bydgoszcz is the economic centre

of Kuyavian-Pomeranian Voivodeship.

The thriving sectors are production, warehouse, logistics and BPO/SSC. The city offers 150 ha of investment areas (below).

The Opera Nova

(left and below) ranks among the most significant arts institutions in the Kuyavian-Pomeranian Voivodeship.

It is considered one of the most interesting opera houses on the Polish cultural map.

The Myślęcinek Forest Culture and Leisure Park (above) is Poland’s largest

city park, measuring about 830 hectares.

The park offers golfing during the spring and summer, and ski- ing in the winter.

The woodland park features rolling hills, bubbling creeks and steep gorges. The park also features a zoo, a botanical garden, a horse riding centre and a dinosaur park.

Panorama of the city's centre (right)

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Emerging cities

City of Lublin Population within administrative borders: 339,000 Unemployment rate: 5.5% Average gross salary: 4,431 zł / € 1,030 Institutions of tertiary education: 9 Students in tertiary education: 63,000 Krzysztof Żuk, Mayor of Lublin:

“Lublin is the largest and most economically developed city in Eastern Poland. Located on important and constantly developing transport routes connecting Western and Eastern Europe, it is an attractive location for business as well as a thriving academic centre. However, it’s the city’s human capital that holds the key to unlocking the city’s potential. Lublin is a city of young, well-educated and entrepreneurial people, and as an open and tolerant city, it attracts students from the farthest corners of the world, being the most popular university city after Warsaw. It is a friendly place for both residents and tourists, which offers high living standards, good quality education and various forms of leisure activities.”

Nation of Cities

Until the partitions at the end of

the 18th century, Lublin was a royal city of the Crown Kingdom of Poland.

In the Lublin Subzone (right) of

the Euro-Park Mielec Special Economic Zone, 70 investors employ over 4,450 people at companies located across 128 hectares.

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Lublin's Old Town

(left) dates back to the 14th century.

Kowalska Street

(right) in the Old Town is vibrant during the Night of Culture

Lublin Airport

photos: Municipality of Lublin, Paweł Bieniek, Jacek Scherer, Marcin Tarkowski (Piximo), Artur Gazda, Eunika Sopotnicka, Ross Helen

(left) is located about 10 km from the city centre and operates several domestic flights, including daily flights to Warsaw.

Lublin Conference Centre (above and right)

Centre for the Meeting of Cultures (right) The 700 Years of Lublin Bridge and Arena Lublin stadium (left)

Aqua Lublin

(below) is the largest and most modern Aquapark with a 50-metre Olympic pool in Lublin.

Families can enjoy swimming pools, water slides and other attractions.

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Emerging cities

City of rzeszów Population within administrative borders: 191,000 Unemployment rate: 5.2% Average gross salary: 4,510 zł/ €1,048 Institutions of tertiary education: 6 Students in tertiary education: 40,000 Tadeusz Ferenc, Mayor of Rzeszów:

The Bridge of Tadeusz Mazowiecki (above)

over the Wisłok river. The bridge was opened in 2015 and has a total length of 482 m.

The roundabout pedestrian bridge

(right) opened in 2012. Designed by MWM Architekci and Promost Consulting, the bridge was developed

by Skanska.

photos: Municipality of Rzeszów

Nation of Cities

“Over the past dozen or so years, Rzeszów has become one of the most dynamically developing urban agglomerations in Poland. What makes the capital of Podkarpacie so unique?

Well, it has a developed aviation sector with many global aviation companies which carry out production and technologically advanced R&D activities. Rzeszów's universities, as well as technical secondary schools, maintain a close partnership with this industry to turn out highly qualified staff prepared for the local labour market. Rzeszów is also an IT mecca – Asseco Poland is headquartered here, as well as many other well-known and respected companies in the IT industry. In addition, Rzeszów provides investors with prime conditions for running a business, which is why it is a six-time winner of the Forbes Most Attractive Cities for Business award in the category of 150-300 thousand residents. But perhaps more importantly, Rzeszów is one of the few big cities in Poland that enjoys positive population growth, constantly attracting new residents. It’s also one of the safest and cleanest provincial cities in Poland – an ideal city for life and professional development.”

Millennium Hall

(left) is the first and biggest shopping and cultural centre in the Podkarpacie Voivodeship. It has over 250 shops including the most famous international brands.

Asseco (above) is an

IT company of global reach which originates from Rzeszów.

Asseco is present in more than 50 countries and it employs over 22,300 people.

Pictured above is its headquarters.

Rzeszów city market (left)

in the middle of the Old Town. Current buildings are from the second half of the 19th century.

The first town hall on this site dates back to the 14th century.

MTU Aero Engines Polska (right) designs,

develops and produces turbine components for Airbus and Boeing.

The company employs over 900 highly-skilled employees.

Nestle Gerber's factory in Rzeszów

(below) specialises in producing children's meals.

Heli-One Polska,

(above) based near Rzeszów, is one of the world’s most advanced helicopter maintenance facilities.

ML System (left)

located in Zaczernie near Rzeszów is one of Poland's leaders in photovoltaic technology.

SkyRes office building (below)

located on Warszawska street hosts such tenants as Deloitte, PWC and the Polish Space Agency.

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real estate

Far East capital continues consolidation in Poland What’s the deal with Poland’s real estate market? Piotr Mirowski, Senior Partner & Head of Investment Services in Poland at Colliers International, talks transactions, teaming up and trends.

This summer has seen a lot of significant activity, particularly in Warsaw, highlights being the sale of Warsaw Spire to Immofinanz and Mbank's 45,600 sqm lease in Mennica Legacy Tower. Are these exceptions, or will there be more big deals like this before the end of the year?

Piotr Mirowski,

Senior Partner, Head of Investment Services in Poland, Colliers International, has been instrumental in closing numerous high-profile investment transactions, both sell-side and buy-side, across all main real estate asset classes with a cumulative volume in excess of €8 bn, including domestic and cross-border corporate, platform and asset deals. Piotr has been with Colliers since 2006 and his previous professional experience includes Deloitte’s audit department. In 2014, Piotr became an equity partner in the firm.

be the biggest challenge going forward, in other words, how to increase the pool of new talent. Still, around €450m in retail deals closed in H1 2019, some of which were legacy deals – transactions from 2018; however, there were also transactions initiated already this year.

We expect several other large ticket One of the main stories in the investtransactions to close before the year’s ment market is the increase in end, both in Warsaw and regional cit- Asian money coming into Poland. ies, setting benchmark pricing along What's the context to this, and will the way. It is a clear sign that Poland Asian capital continue to increase continues to enjoy ever-increasing in the months and years ahead? liquidity. Office and logistics asset The Polish market has indeed witclasses have dominated the landscape, nessed increased interest from Asian accounting for about 75% of the over- investors, originating from Singapore, all activity. New buyers are also look- Malaysia, China, Philippines, South ing to team up with established asset Korea and Japan, and we expect the and investment managers in JV struc- trend to continue. The main impetus tures, such as the acquisition of a 70% behind increased investment activity stake in EPP’s regional office portfo- is the search for yield. The inclusion lio, which allows them to extract even of Poland into the FTSE Russell index, more value from existing assets and the availability of high-quality investleverage the platform for growth via ment-grade products and the positive new acquisitions. Portfolio and plat- mid-term economic fundamentals all form - meaning a portfolio with the combine to ensure it will remain strong. relevant scale and qualified person- Far East capital continued its expansion, nel which often accompanies such in particular, in office - both in Warsaw a platform - are also in high demand, and in regional cities - and logistics with large players looking to establish markets. The market also witnessed the a significant footprint in Poland. first student housing transaction in CEE. Kajima, an institutional investor from You hear mixed reports of the state Japan, acquired from Oaktree a majorof retail in Poland. How would you ity stake in Student Depot, which opersum up the sector in a nutshell, ates 2,000 beds in five Polish cities. We expect this segment of the market to both in terms of the leasing market grow strongly, together with the rental and the investment market?

The activity of investors is limited as apartment market. the general global sentiment towards retail is transmitted to local markets. There is a lot of modern office However, in our opinion, retail funda- space coming online in Warsaw in mentals in Poland are still strong, both the next 18 months or so – is there in terms of capital markets and leasing, the tenant demand to fill this space? with absorption levels still going strong, The vacancy rate in Warsaw contindespite tightening labour markets ues to decrease: 8.5% overall as of H1 across Poland’s major cities. This could 2019, and 5.6% in the city centre - and a number of projects currently under construction are either substantially pre-leased, pre-committed to tenants or under advanced discussions. The vacancy rate in the CBD is at its lowest level since 2012. Investors share the confidence in the leasing market, a fact confirmed by the interest in office assets. This translated into €1.1bn in closed office deals representing 25 sold buildings in 19 transactions – a new half-year record.

‘The Polish market has witnessed increased interest from Asian investors and we expect the trend to continue.’

What trends or surprises might we expect in Poland's commercial real estate market next year, or in the years ahead?

Liquidity and the diversity of investors are expected to grow. All market participants are waiting for the arrival of institutional domestic capital, which could be one of the final missing elements for Poland to be considered as a fully-developed market. However, given the demand, there could potentially be a supply gap in terms of availability of investment product. Pricing is expected to remain firm with further yield compression for prime office buildings in Warsaw city centre and core assets in regional cities, such as Wrocław, Kraków, Poznań and Gdańsk. The surprise could be that investors will be willing to accept a lower spread to Western Europe in comparison to what we have witnessed historically.

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conference & cocktail party

2nd edition

Poland & CEE: Co-building thE bElt & Road 2-3 June 2020, Poland

What business opportunities are there for Polish and CEE companies in the largest global trade and infrastructure initiative ever launched?

Find out from leading international figures what Belt & Road means for this region.

Economic Rationale

Latest developments in trade relations between China and CEE Connectivity: Investments from China and the EU

CEE as the crossroads between East and West / North and South Air: latest infrastructure developments within CEE Sea: latest infrastructure projects: ports in Baltic / Adriatic / Mediterranean versus Nord Range ports

Land: railway infrastructure within CEE (railways, tunnels bridges terminals, border crossings) / road infrastructure E-Commerce

Will the big players from China finally make their appearance in the CEE region?

Activities of (national) courier companies Digitalization / Cybersecurity

Opportunities of increased cooperation within supply chains spanning the BRI Example: railways cooperating on digital waybills Threats through increased digital connectivity along the BRI Registration and more information: poland-today.pl

real estate

Boom on Poland’s real estate market continues The good times keep rolling for the commercial property sector, particularly in Warsaw, but there remains room for legislative improvements.

Statistics and conclusions

Mateusz Grabiec

is a partner in the Real Estate team of the Baker McKenzie Warsaw office. His professional experience includes legal assistance at all stages of real property development, commercialization and sale process in relation to a wide range of real property projects, including office, PRS, logistics and infrastructure projects.

from numerous analyses of Polish commercial property cannot be wrong. Clearly, over the last decade, we have witnessed a huge transformation of the sector in Poland, creating a mature market which offers competitive investment products, both in all standard sectors (office, warehouse, retail and hotel) and alternative investments such as student residential or apartments for rent. The extraordinary success of the market is illustrated by the commercial property investment figure for 2018, with the value of transactions reaching a record high of €7.2bn.

The boom isn’t letting up. The first quarter of 2019 indicates continued strong interest in investing in Poland.

What is more, our practice and market data show the group of active investors has grown since last year. On the one hand this creates competition among investors, but on the other hand it motivates developers to come up with new products. Developer activity is also driven by strong demand, which reached record highs in the office sector in the first two quarters of 2019 (more than 400,000 sqm of office space were leased). Due to limited availability of product and a small amount of vacant office space, this demand extends also to projects which are still under development. The commercial property market in Poland benefits from the security provided by the growing scale of the market, by its liquidity and also from positive macroeconomic factors - in particular the growing economy.For these reasons, Poland’s commercial property market has every chance of continuing on its path of fast growth in the near future.

One of the conditions that needs to be fulfilled to allow for such development to continue is to foster and maintain a friendly and stable legal environment. Modern legal solutions must be available to activate and support sustainable market growth. However, Poland has still some areas which need to be tackled or resolved in both these cases. Anyone looking at today’s legal environment must acknowledge that there aren’t any particular barriers making it difficult for investors to enter Poland, yet laws and regulations which govern the investment and development process can be complex. This is often an outcome of historical legacy.

‘The first quarter of 2019 indicates continued strong interest in investing in Poland’ It’s hard to make a clear assessment of the actions taken by the Polish authorities in that respect. We can see some positive trends, such as the lessening of the significance of perpetual usufruct and the simplification of administrative procedures, as well as a certain relaxation of the agricultural trade regime (after agricultural properties were at first almost excluded from trade). The changes which have been announced, designed to simplify and stabilise the development process - in particular excluding the possibility of invalidation of construction and occupancy permits after a lapse of a 5-year period - must also be viewed as positive. On the other end, the way in which changes which directly or indirectly affect commercial property market players - broadly speaking - are introduced, is a negative thing. In this regard, particularly worrying is the pace of the legislative process and frequent practice of skipping the phase of market consultations. The most glaring example of this was the introduction of the Sunday trading ban, as well as the fast-track enactment of new regulations without allowing market players enough time to prepare for them. The same goes for the numerous amendments either prior to, or soon after, enactment of new regulations.

In conclusion, the Polish legal system is not the optimum tool to either activate or regulate the commercial property market. However, one cannot say that it’s a barrier to the market’s further development either. Still, reasonable legal changes which respond to concerns voiced by commercial property market players could further speed up development, not to mention the introduction of REIT into the Polish legal system or introducing system solutions to the problems of short-term letting of apartments. by Mateusz Grabiec

photo: Filip Warulik

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Office rentals debunked

Well-being offer maximum flexibility for new ten"Today, modern rental spaces are also ants. For example, HubHub, a co-workabout an inclusion mindset," says ing office space provider in Warsaw, Marcin Zaleski, Senior Associate at offers subscriptions on a monthly basis.

Colliers International, explaining that "Tenants can cancel their subscriptions tenants choose spaces that make the with a one month notice period," says place. "Tenants want new buildings Bartosz Chmiel, Brand and Marketing that are ready to meet every need of Manager at HubHub. "The ever-changemployees. Canteens, restaurants, fit- ing nature of work pushes tenants to ness clubs, ATMs and even spas are look for flexible office space where on the list," he says, describing the they can adjust and adapt the office new trend of ‘placemaking locations’. to meet their business requirements," Tenants are also attracted to spaces says Zaleski. that are livable and focus on well-being.

"Corporations seek placemaking loca- Sustainability tions," says Karol Patynowski, Director Business owners want to work in a of Regional Markets at JLL. "Leisure building that is about sustainable soluopportunities and different amenities tions while being cost-effective at make these locations very desirable," he the same time. "Tenants prefer buildadded. The mixed-use developments of ings with green certificates, such as Elektrownia Powiśle and Warsaw Spire BREEAM or LEED," Patynowski says. are examples of placemaking loca- More competitive developers offer spaces with certificates proving that tions in the capital. the building supports the health and Marketing wellbeing of employees. Other tenants Developers and real estate agencies look for space featuring hi-tech solurely on digital marketing strategies to tions which can improve the functionattract the right tenant and generate ality of the building. Experts highlight buzz in the community. Social media the fact that eco- friendly office spaces platforms such as Facebook and improve the productivity of those who Instagram help lure tech-savvy work- occupy them, which translates into betforce and increase brand awareness, ter financial results. according to Chmiel. Landlords also want to be noticed. Even small mar- Connectivity and Location ket players are not afraid to invest in It’s all about networking: “Today, both digitalisation and high-tech solutions landlords and tenants want a shared to produce engaging and eye-catching social experience, networking and collaborations,” Chmiel says. The advertisements. effect? Cross-company collaboration Lease times and more employment opportuniTenants choose between two options: ties for office employees. And finally, short or long lease terms. "Smaller play- the location. Experts say it’s not just ers (SMEs or startups) go for short lease about finding the most profitable locaterms. Thus, it is possible for them to tion, but also about increasing and rent a space for 2-3 years," Zaleski says. improving brand awareness and conLarger players opt for long term leases nectivity with the rest of the world. for 5 or more years. Co-working spaces

by Małgosia Krakowska

photos: HubHub

With the highest investment activity on the real estate market, Warsaw has been the fastest-growing prime office space location in the last six months. So what’s attracting tenants and what’s on their must-have checklists? Here are the top five according to experts.

real estate

‘Both landlords and tenants want a shared social experience and networking’

HubHub opened

two co-working spaces in Warsaw with fixed desks, private offices, furnished open areas, kitchens, meeting rooms and phone booths – everything budding entrepreneurs or business tycoons might need.

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real estate

A bet on Wola that’s paying off Many thought Ghelamco had over-reached when it built a big new project in an under-developed part of Warsaw. The decision doesn’t look so bad now.

photo: Ghelamco

When Ghelamco

decided to build an office tower in Wola dis- office snapshot trict, Warsaw’s real estate market After a relatively slow start to 2019, thought the hitherto sensible devel- Warsaw's office market has seen increased oper of Belgian origin had taken leave activity as the year has progressed, culminatof its senses. Not only was the com- ing in mBank's record-breaking 45,600 sqm lease in Menica Legacy Tower over the sumpany proposing a 220m, 49-storey mer. Demand for space is strong - the Q2 take complex with 113,000 sqm of leasable up figure of 266,000 sqm is a Warsaw office office space, which – in the context of market record. Total office stock in Warsaw the Warsaw market at the time – was exceeded 5.5m sqm at the end of H1 2019 and there is currently over 700,000 sqm of office notoriously difficult (you can’t build a space under construction. tower in stages and wait for each part to lease-up before going on to the next Rondo Daszyńskiego is now the home one). They were also proposing to build of a new metro station and surrounded it in the run-down, post-industrial semi- by towering office buildings in various wasteland a few hundred metres west stages of development. “A brand new of Rondo ONZ. To date, of commer- business centre of Warsaw is rising right cial significance, only the Hilton hotel in front of our eyes,” said Jeroen van der and Warsaw Trade Tower (WTT) had Toolen, Ghelamco’s Managing Director ventured so far outside the comfort CEE. “Offices, hotels, flats, stores, food zone of Warsaw’s acknowledged busi- amenities and attractive public spaces ness centre, although these were two are emerging in the direct vicinity. unique cases. The Hilton was a hotel, I think that in the near future the place so its clientele was transient, and the will become a showcase of the modWTT was an anomaly – built to house ern capital.” Most significantly, from the head of Daewoo’s then-enormous the market’s perspective, Ghelamco operation in Poland before the com- – together with Madison International pany went bust. So on the surface, the Realty, who had taken a part share in the fundamentals weren’t encouraging for project in 2018 – sold Warsaw Spire to such a major development. “A lot of Austrian real estate group Immofinanz my friends told me the project wasn’t for €386m, making it the landmark going to happen – the building was too investment deal of the summer. big, it was too early and the site was in the middle of nowhere,” Jarosław More capital projects Zagórski, Commercial & Business What now for Ghelamco? Their Warsaw Development Director and Member of HUB mixed-use scheme, located diagothe Management Board at Ghelamco, nally across from Warsaw Spire, is leastold a group of international business ing-up, with Getin Noble Bank’s 18,500 journalists recently. “But we believed sqm, seven-year lease and British bank that this project could be a landmark Standard Chartered’s 3,600 sqm lease project and that we could make some- (to house its global service centre) as thing out of it. And we did it. In 2016, two notable deals. On another side of the building was chosen at MIPIM as the Rondo Daszyńskiego, the 55,000 sqm Warsaw Unit office tower is also under best new office building in the world.”

Fast forward a few years and their construction (shown left). Away from decision to locate in Wola looks remark- the office sector, the company has ably prescient. The previously far-flung almost completed its luxury residential Foksal 13/15 scheme with 55 apartments ranging from 47-260 sqm.

Ghelamco is also looking outside the capital. After recently completing a project in Kraków, the company has begun preparations for another in the city and is also planning an ambitious mixed-use project in the heart of the New Centre of Łódź. But the developer isn't forgetting about Warsaw, and will soon reveal other projects in the very centre of the capital.

‘A brand new business centre of Warsaw is rising right in front of our eyes’

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real estate

Short stay is the new black There are 40 million reasons why investors should take note of Poland’s hotel industry, says InterContinental Hotel Group’s Joanna Kurowska.

The room

InterContinental

photos: Piotr Krajewski

Hotels Group (IHG) is a multinational hospitality company headquartered in England. It has over 5,600 hotels across nearly 100 countries worldwide and owns several brands.

of international journal- the 24 journalists during Poland Today’s ists assembled on the 38th floor of International Media Tour. ‘In three years, the Warsaw Spire was nearly caught those two markets will continue to grow off guard when Joanna Kurowska by 30%. That's simply unprecedented.” said that the Polish hotel industry is She then went on to reveal that IHG set to register 40 million overnight has another 18 new hotels in the pipestays this year – an increase of 15 mil- line to be completed by 2023, which will lion since 2012. The audience had just extend its market footprint to nearly 30 heard about the record gains in the hotels across the country, from Kraków local commercial real estate market, to Gdańsk and Rzeszów to Szczecin. but not even the local journalists would For perspective, IHG operates a comhave expected to hear that the Polish bined total of 15 hotels in Austria (five), hotel market had nearly doubled in just the Czech Republic (four), Slovakia seven years. Of course, it was noth- (four) and Hungary (two).

The overwhelming majority of IHG’s ing new for Kurowska, IHG’s recentlyappointed Director of Operations, guests (70%) are Poles, the largest segLuxury & Managed, Northern Europe. ment of which are business travellers.

She had seen this development way It’s easy to understand why IHG would back in 2011 when she returned to welcome the development of a modPoland after working abroad and took ern convention centre in Warsaw, espea position at IHG’s Warsaw office. She cially considering that around 50% of its arrived just in time to see UEFA Euro local assets are located in the capital.

2012 open Poland to the world and the It has been a moot point that has been new regional airports and budget air- hanging over the city for more than lines bring in record numbers of tour- 15 years. “It is crucial to have a modists – 19.6 million international visitors ern convention centre and definitely travelled to Poland in 2018, up from Warsaw is losing competitiveness as 14.8 million in 2016. This type of growth, a business destination, especially when Kurowska said, has led the UK-based we consider that Kraków, Katowice and IHG Group to mark Poland as a priority Rzeszów all host convention centres,” market. IHG was one of the first major Kurowska said after the tour. “We have international hotel chains to move seen the impact in Germany. Berlin, into Poland when it opened its first Munich and Frankfurt benefit greatly Holiday Inn in Kraków in 2001 and from their convention centres, with two years later, the InterContinental in visitors coming from all over the world.

Warsaw. The group currently operates Trade shows drive demand and bring 11 hotels in Poland through four brands: new investments to these locations.”

InterContinental, Holiday Inn, Hotel Like other sectors, the local hotel Indigo and Holiday Inn Express. In the industry faces recruitment challenges past three years alone, it has opened in the labour market and development five hotels, including this summer’s big has been affected by the increases opening, the Holiday Inn – Gdańsk City in construction costs. Kurowska also Centre, housed in the city’s flagship noted that more international players development location, Granary Island. have arrived on the scene, increasing “What we see from the numbers is that competition around a selection of cities.

Warsaw and the Tricity areas are grow- “However, we still see growth opportuniing at the same speed,” Kurowska told ties especially within the midscale, boutique and lifestyle segments,” she said, before earmarking the east of the country as a growth area of the future. The area should benefit from the completion of the S8 motorway between Wrocław to Białystok (via Łódź and Warsaw) and the development of S7 motorway between Gdańsk and Kraków (via Warsaw, Radom and Kielce). “Once the infrastructure improves, it's only a matter of time for the hotel industry to pick up pace in these regions,” she said.

‘IHG has another 18 new hotels in the pipeline to be completed by 2023’

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From EmErging to DEvElopED

2nd

intErnational mEDia tour to polanD 18/19 September 2019

After 27 years of continuous growth, Europe's fastest-growing economy was boosted by FTSE Russell's upgrade from Emerging to Developed in September 2018. One year later, on the 15th anniversary of Poland's accession to the EU, 20 years after joining NATO, and 30 years since Poland became a free market economy, it's time to remind the world of Poland's economic & business success story.

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The Warsaw Stock Exchange

hosted the journalists on the second day of the tour.

From EmErging to DEvElopED

2nd International Media Tour to Poland Poland Today brought leading international journalists covering business and economics to Warsaw in September. Over 24 media representatives participated in a 2-day tour to learn more about Poland’s economy. The tour promoted Poland’s economic success story worldwide and highlighted the country's business achievements on global markets.

Titles participating in the tour: – Australia: Australian Financial Review – Baltics: The Baltic Times – Brazil: Valor Economico – China: Xinhua News Agency – Czech Republic: Seznam.cz – France: La Tribune – France: Challenges – France: Les Echos – Hungary: Vilaggazdasag – India: Indo-Asian News Service – Israel: Yedioth Ahronoth – Israel: Calcalist – Italy: Il Sole 24 Ore – Italy: StartupItalia – Japan: Nikkei – Norway: State of Globe – Portugal: Expresso – Romania: Ziarul Financiar – Slovakia: Trend Magazine – South Korea: The Chosun Ilbo – Turkey: Anadolu Agency – UK: Forbes Europe – Ukraine: Ekonomichna Pravda – US: New York Times

photos: Alina Gajdamowicz (Bind Up Photos)

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From your correspondent in Warsaw. In between

breaks during the media tour, Poland Today surveyed the opinions of the 24 journalists heralding from 22 countries.

Here is what some of them had to say about Poland, including their impressions from both before and after the tour.

At the Zodiak,

the tour met the Mayor of Warsaw, the Mayor of Łódź and the Deputy Mayor of Poznań, who enlightened them about the strengths and priorities of their respective cities, emphasizing that they are going through a period of unprecedented growth and development.

From EmErging to DEvElopED – thE intErnational mEDia tour to polanD

At the Zodiak Warsaw Pavilion of Architecture What topics about Poland tend to appear in your news feed or what impressions did you have about the country before you arrived here?

Jozef Rynik (Slovakia, Trend Magazine): Mostly political issues. Not economic, actually.

Filip Harzer (Czech Republic, Seznam.cz): Judicial reform and the change of the government towards conservatism. There have been lots of reports about the quality of food coming from Poland. There was a beef scandal this January that sparked memories of a similar one ten years ago. The media was talking about it for the whole week.

Anat Barzilai (Israel, Calcalist): It was the big political crisis around the Polish government’s so-called ‘Holocaust law’.

I think it’s still hard for Israelis to understand that Poles also suffered during the Nazi period. It might take at least three generations until that changes.

Left: Mayor Hanna Zdanowska told the journalists about the journey her city of Łódź has been on in the last few years.

Jérôme Marin (France, La Tribune): The rule of law and the judicial changes.

Richard Martyn-Hemphill (UK/Latvia, Baltic Times): In the Baltics, I hear about the troubles of connecting the wider region through Rail Baltic and what part Poland has to play there. I've also focused a fair bit on Poland's attempts to wean itself off Russian gas through the LNG terminal in Świnoujście. I also hear a bit about the security situation, particularly how NATO is trying to reinforce itself to close the Suwałki gap.

Marc Santora (USA, New York Times): Like a lot of people coming from the States for the first time, your impression is set in the 70s or 80s: a sort of grey Cold War spy novel, dark, a little grungy. And that's not what I found in Warsaw. I was surprised by just how vibrant it was, and just how dynamic and European Poland felt.

photos: Alina Gajdamowicz (Bind Up Photos)

Below: Mayor Rafał Trzaskowski emphasised Warsaw’s position as an attractive city for international business people.

Christina Peres (Portugal, Expresso): One word I would say would be development. Concerning politics, it would be anti-European and a feeling of doubt about the future of the EU. But development is the most important.

Kenta Shinozaki (Japan, Nikkei): Recently, I have read a lot of information about the relationship between the US and Poland. And because I’m based in London, the future of the Polish people in the UK has been a very large topic. Given the shortage of labour, British business people are very concerned about losing their Polish staff.

Above: Deputy

Mayor of Poznań Bartosz Guss talks with a journalist from the New York Times.

Below: The media

party pose for a group photo with the mayors at the ZODIAK Warsaw Pavilion of Architecture.

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At The Heart's office in Warsaw Spire Hans van Leeuwen (Australia, Australian Financial Review): I think of school friends and people I've worked with with Polish surnames popping up everywhere, and they'll be second or third generation Poles. They're not a community that really sets themselves apart. They're very integrated into the Australian community, I would say.

At the office of

The Heart in Warsaw Spire, the journalists learned key facts and figures about Poland's economy and real estate market, before listening to a panel discussion about the business environment in Poland.

Galina Kalachova (Ukraine, Ekonomiczna Pravda): Ukrainians perceive Poland as a European country with high salaries.

Razvan Botea (Romania, Ziarul Financiar): There is some interest in Poland. But in my opinion, there should be more interest as Poland could be an example for Romania. Both Poland and Romania stepped into capitalism more or less on the same level and both used mostly the cheap labour force to attract foreign investment.

But then Poland developed its infrastructure, and now it's moving from a cheap labour force to a skilled labour force. And that requires education.

Luca Veronese (Italy, Il Sole 24 Ore): The interesting theme from my point of view is the difference in the state of the economy and politics. The economy is growing fast without any problems or negative influence from the political field.

Assis Moreira (Brazil, Valor Econômico): Mainly about the measures taken by the ruling party that worried the European Commission. Nothing about the state of the economy. I did not know that Poland was growing so much.

What type of trade relationship does your country enjoy with Poland, if any? What’s on the horizon?

photos: Alina Gajdamowicz (Bind Up Photos)

Jozef Rynik (Slovakia, Trend Magazine): Our biggest developer, HB Reavis, is building skyscrapers here. And our investors have retail stores. Żabka used to be owned by a Slovakian company. Mbank has had branches for ten years in Slovakia.

Filip Harzer (Czech Republic, Seznam.cz): We mainly export cars and automotive parts, and import food from Poland.

Richard Martyn-Hemphill (UK/Latvia, Baltic Times): Poland is moving up the value chain. A lot of British companies are starting to appreciate that and split office space between Poland and the UK. Christina Peres (Portugal, Expresso): Banking is very familiar to me. When I see Millennium Bank here, it makes me feel like I'm in Portugal.

Kenta Shinozaki (Japan, Nikkei): Japan exports cars and automotive parts. About 300 Japanese automotive companies are in Poland. I understand that the trade relationship between the two countries is very good.

Hans van Leeuwen (Australia, Australian Financial Review): From a financial perspective, there are Australian pension funds and I believe, one large Australian bank that have bought infrastructure assets and invested in Poland. And I would expect that to continue, given the growth rates and the potential opportunities.

If you were to put on your investor’s cap, in which area or sector would you invest based on what you have seen? Or in general, what have been your key takeaways?

Jozef Rynik (Slovakia, Trend Magazine): I was impressed by Łódź, but I also like Kraków and Western Poland.

Filip Harzer (Czech Republic, Seznam.cz): Maybe in the media, because a free press is really important. I’m unsatisfied with how politicised the local media is and the strong bias it carries.

Anat Barzilai (Israel, Calcalist): I would establish tours for Israeli high school students to Warsaw and other cities – and not just Auschwitz and the other camps. So they can get to know Polish culture and everyday people, like we’re doing right now.

Jérôme Marin (France, La Tribune): I guess real estate. It looked promising.

Maybe by the sea in a city like Sopot.

Richard Martyn-Hemphill (UK/ Latvia, Baltic Times): The Warsaw Stock Exchange will be listing agriculture for the first time and that's a great step forward, versus the previous opaque practices of deal-making. A more transparent marketplace there should offer all sorts of possibilities for innovation and better business practice.

Christina Peres (Portugal, Expresso): From what I've seen in smaller cities, I would invest in real estate. But not skyscrapers. Smaller stuff, like old factories or mills to be transformed into housing or lodging for tourists.

Kenta Shinozaki (Japan, Nikkei): I would invest in tech startups because there are many talented people in Poland.

I was surprised as I walked the streets of Warsaw to see so many huge financial institutions and global companies.

Left: Dorota

Latkowska, CoFounder & Partner, REINO Partners

Below: Tomasz

Puch, Head of Office and Industrial Investment, JLL

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Below:

Joanna Kurowska, Director Operations Luxury & Managed, Northern Europe, InterContinental Hotels Group (IHG)

Right: Dominik

Rozkrut PhD, President of Statistics Poland

Below: Journalists

photos: Alina Gajdamowicz (Bind Up Photos)

in the lobby of Warsaw Spire

Left: Paweł Panczyj, Strategy & Business Development Director, ABSL Below: Jarosław Zagórski, Commercial & Business Development Director and Member of the Board, Ghelamco Left: Jędrzej Iwasz-

kiewicz, Co-Founder and VP Business Development, The Heart, Corporate Center for Digital Ventures

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From EmErging to DEvElopED – thE intErnational mEDia tour to polanD

At the Warsaw Stock Exchange Hans van Leeuwen (Australia, Australian Financial Review): I was kind of surprised to feel the ripples of Brexit resonating all the way out into Poland; that companies might, instead of looking just to Dublin or Luxembourg, look to relocate here, coupled with this push to possibly have more Polish expats return to Poland from Britain after Brexit.

At the home of the Warsaw bourse,

our international guests met with representatives of listed tech companies over a networking breakfast, before taking part in a conference focusing on the international expansion of Polish companies.

Below: Journalists giving their feedback on Poland

Galina Kalachova (Ukraine, Ekonomiczna Pravda): I have been impressed by the quality of development in infrastructure projects and that Poland has big and attractive projects for investment. Because in developing countries, we have a problem when we communicate with investors, mainly because there is a deficit in the number of good projects. And after hearing about the STH project, I understand that you have very good communication with investors.

Razvan Botea (Romania, Ziarul Financiar): There are many examples from Poland that Romania should follow, like the digitisation process taken by the tax authorities. We have a problem with tax evasion in Romania.

The tax gap is 36% of GDP and fiscal revenue is only 26% of GDP. That's very, very low. The digitisation process is occurring right now in Poland [which can counter against tax evasion].

Luca Veronese (Italy, Il Sole 24 Ore): That’s easy: Warsaw. I love the city. The first thing is the incredible atmosphere.

I think Poland, at the moment, has the energy of a young lady growing up and wanting to demonstrate that she can do it.

Italy, on the other hand, is a very old lady.

photos: Alina Gajdamowicz (Bind Up Photos)

Assis Moreira (Brazil, Valor Econômico): For Brazil, one focus would be in defense, both in terms of buying and selling materials. I see good prospects for tourism as well, since LOT has a programme called ‘Find your Poland’ to attract people of Polish origin to visit Poland.

Brazil has the second largest group of people of Polish origin, around 2 million, only surpassed by US with 10 million.

Calling upon your journalistic hunch, what will be the major trending story about Poland in 5 years’ time?

Jozef Rynik (Slovakia, Trend Magazine): We admire Poland’s usage of the EU cohesion funds. They have used them very efficiently compared to Slovakia. So the further development of roads and highways, because Slovakia has been really slow with this. We may ask ourselves later: if Poland has done it, why can’t we?

Left: Mikołąj Wild,

Minister and Government Plenipotentiary for Solidarity Transport Hub

Below: Tadeusz

Kościński, Deputy Finance Minister

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At the Warsaw Stock Exchange Filip Harzer (Czech Republic, Seznam.cz): It will be the changes after the second win of the Law and Justice party. I think they’re going to be really big, covering the social sphere, the political system, the media, etc.

After a Q&A with

the head of LOT Polish Airlines and the Deputy Finance Minister, the tour finished with a presentation of the new Solidarity Transport Hub Poland scheme.

Anat Barzilai (Israel, Calcalist): Probably how more and more Israeli companies will come here… Since I arrived here, I have felt a very strong bond with everyone. When they hear that I'm from Israel, they are so warm. It feels like everyone loves me here. And I don't get it anywhere in the world. I think it’s because we have the same trauma; just in different sizes. It makes for a really strong bond.

Jérôme Marin (France, La Tribune): I asked the question today about Poland’s chances of joining the Euro and I was told it wouldn’t happen anytime soon.

The question will be about the relationship between Poland and the EU. I haven’t been following closely, but I feel that the government has become more populist.

Richard Martyn-Hemphill (UK/Latvia, Baltic Times): My sense is it will relate to the automation of large parts of the workforce, and how Poland responds to that. It will be a struggle towards a new social contract that will see the state play more of a welfare role than it does at the moment. In terms of relations with the EU, Poland seems to have consistently punched below its weight in Brussels. It's struggled to muscle its way in as a third big powerbroker in Brussels after France and Germany. That will be the story for the next five years.

Marc Santora (USA, New York Times): If I could predict one month from now, I'd be paid a lot more money. But if Poland continues through whatever bumps and stumbles that it has endured over the last 30 years, then it will be in good stead.

Christina Peres (Portugal, Expresso): I think that Poland will benefit from Brexit, in the sense that capital is always attracted to areas of development. But when I landed, I was looking at Warsaw and I thought the city had doubled in five years. I've noticed that it's also a more international city than it was five years ago. And let's hope that politics won't ruin this.

Kenta Shinozaki (Japan, Nikkei): My point would relate to the future of the European Union. I believe Poland will have a more important role in integrating the European Union. Unfortunately, the European Union’s strength is not very good at the moment and I believe Poland must do a lot to unite the block.

Luca Veronese (Italy, Il Sole 24 Ore): Their connection with Europe is the most important thing for Poland in the future. All the partners know it.

They have to work harder in Brussels to make the EU stronger. In the European Union, we need the support of Poland, the leading country in the region.

Assis Moreira (Brazil, Valor Econômico): We will continue to see tension with the EU, about the discussion around democracy and societal trends in the country, at least more than the economic side of things.

Now to the hard-hitting questions. What is your favourite Polish food or beverage?

Jozef Rynik (Slovakia, Trend Magazine): Żurek Filip Harzer (Czech Republic, Seznam.cz): Definitely pierogi. My favourite pierogi bistro is on Plac Unii Lubelskiej in Warsaw. The lady there knows me very well and always gives me extra because I’m Czech and Czech people are popular here.

Anat Barzilai (Israel, Calcalist): It would have to be cow’s tongue [ozór].

It sounds disgusting, but it’s very good.

For dessert, I like the cinnamon buns with cherry [drożdżówki z wiśniami].

Richard Martyn-Hemphill (UK/Latvia, Baltic Times): I had a very good soup last night. I believe it was called Żurek. On previous trips, I have been very impressed by Polish horseradish. I think it is the best in the world.

Marc Santora (USA, New York Times): I'm surprised that Warsaw has probably the most vegan restaurants in Poland. My favourite restaurant, a place that actually reminds me the most of New York, is Koko & Roy in Warsaw.

Christina Peres (Portugal, Expresso): I wouldn't be able to spell it, but it’s a stew: bigos.

Kenta Shinozaki (Japan, Nikkei): Last night, I had a Polish dumpling with lamb. It was very nice.

Luca Veronese (Italy, Il Sole 24 Ore): I love Polish cuisine. It is very similar to my Italian region. I'm from the Venice region in the eastern part of Italy and I found something here like gnocchi: kopytka.

Assis Moreira (Brazil, Valor Econômico): Well, I know Żurek soup.

Above: Professor Witold Orłowski,

Chief Economic Advisor, PwC Polska

Below: Piotr Malepszak, Acting President of Solidarity Transport Hub, speaks with the journalist from Vilaggazdasag, Hungary

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Left: the correspondent from Il Sole 24 Ore, Italy

Left: journalist from The Calcalist, Israel Right: Minister

Mikołaj Wild talking with the journalists from South Korea and Turkey

Right: Richard Stephens discussing the expansion of Polish business abroad with Rafał Milczarski of LOT Polish Airlines and Tadeusz Kosciński, Deputy Finance Minister

Left: the correspondent from La Tribune, France

Above: Rafał

Milczarski, CEO of LOT Polish Airlines, with journalists from Brazil and the USA Kruczkowska, Innovation Director, Polish Development Fund

Right: Marek Dietl,

President of the Management Board of the Warsaw Stock Exchange with the journalist from NIKKEI, Japan

photos: Alina Gajdamowicz (Bind Up Photos)

Left: Eliza

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We need to talk about Poland and the Belt & Road

Poland & CEE:

Co-building the belt & road

Leaders in global transport and logistics, legal advisors, investors, embassy representatives and think tanks gathered in Warsaw for the first conference of its kind to find out how relevant the Belt & Road Initiative is for Polish & CEE businesses.

More than just rail Frank Schuhholz got the ball rolling by tackling the big question of the conference: ‘Can the CEE countries be the buckle on the Belt and Road?’ The CEE region has done quite a lot already in terms of infrastructure investment supported by considerable amounts of EU funds.

But the region definitely has many opportunities to further improve its position when connecting Asia with Europe and vice versa.

Frank Schuhholz, CEO of FMS Advisers: When talking about the CEE region, Poland definitely plays a key role in connecting China via Kazakhstan, Russia, Belarus and into the EU. And it is not an exaggeration to say that more than 90% of the trains which we see coming from China are already running through Poland.

A healthy level of curiosity preceded the first ‘Poland & CEE: Co-building the Belt and Road’ conference in Warsaw, which was co-organised by Poland Today and conference creator Frank Schuhholz, CEO of FMS Advisers and a foremost expert on global transport and logistics. The $900bn Belt and Road Initiative (BRI) has become an enigma of sorts. Wolfgang Lehmacher, Global Supply Chain Evangelist and former Head of Supply Chain & Transport Industries at the World Economic Forum, summed it up best in his keynote address, suggesting that the sheer magnitude of the initiative naturally attracts uncertainty and sometimes fear. “I have hardly been on panels that were as emotional as Belt and Road panels.”

There was also a certain level of nervous excitement about the conference itself, given that it was the first independent, international, English-language C-level event of its kind in the region.

It was a charged atmosphere in which Richard Stephens, Founder and Editor of Poland Today, and Frank Schuhholz welcomed the participants. With more than 35 expert speakers from 13 countries, Schuhholz was no doubt buoyed by the size and diversity of the gathering when he said: “We're not only talking about rail, which the BRI is so far mostly known for in Europe. We're also not only talking about sea freight, but we're talking here about all transport sectors, as well as the infrastructure, financing and even legal elements of this initiative.”

Conference hosts: - Richard Stephens, Founder & Editor, Poland Today - Frank Schuhholz, CEO of FMS Advisers

photos: Piotr Kała

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ConneCtivity is destiny

our future is in our hands

Wolfgang Lehmacher, global supply chain and logistics thought leader, and a consultant to Fortune-500 companies, sees the BRI as a facilitator of what he calls ‘connectivity’ and ‘community’, wherein an exchange of ideas (technology transfer), funds and new business relationships should follow the construction of transport infrastructure between the countries involved.

Dr. Lúcio Vinhas de Souza, argued passionately that the EU was no less a major player in trade between the East and the West than the USA or China. He urged the member states of the EU to approach the BRI in a unified and transparent manner, while also reminding the audience of the EU’s deeply-established advantages: wealthy consumer markets, deep financing resources, a clear legal framework and ethical trade policy.

Wolfgang Lehmacher, Senior Supply

Dr. Lúcio Vinhas de Souza, Head of the Economics Team, European Political Strategy Centre, European Commission:

Chain Strategist and former Head of Supply Chain and Transport Industries for the World Economic Forum:

Eurasia as an economic integrated space.

That’s the idea behind our ‘connecting Europe and Asia’ strategy. Eurasia is and will be the economic centre of the world.

The Belt and Road is not only an economic initiative. It's a political initiative, a foreign policy initiative and a security initiative. And whatever side of the table you sit, you see that in a different way.

Left:

- Dr. Chen Chen, Budapest-based China Special Advisor, Baker McKenzie - Richard Stephens, Founder & Editor, Poland Today

Below: Wolfgang

Lehmacher, Senior Supply Chain Strategist and former Head of Supply Chain and Transport Industries for the World Economic Forum

Right: Frank Schuhholz, CEO of FMS Advisers and a foremost expert on global transport and logistics

Above: Dr. Lúcio

Vinhas de Souza, Head of the Economics Team, European Political Strategy Centre, European Commission

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the best priCe will always win

winner takes all?

Representatives from the big railway undertakings and the government sector concluded that the success of the BRI would be determined by a simple equation of costs and collaboration between all players along the line, and transparency of the movement of goods.

Moderated by Andrew Wrobel of Emerging Europe, the panel debated whether the spoils of the BRI would be reaped by a few or shared amongst many, before agreeing that the overall pie for the CEE region and Europe will grow with increased frequency and cooperation.

Dr. Christian Kuhn, Chairman of the Board of Directors of Kazakhstan Temir Zholy (KTZ):

The shape of the ‘New Silk Road’ will be determined by shippers and not by any governmental institution.

Steffen Bobsien, CEO of DB Cargo Polska:

Poland has the potential to play a major role as a hub and entry gate, but it cannot take its position for granted as other countries are also stepping up their efforts.

Dr. Krzysztof Senger,

Executive Vice President of PAIH:

If Poland is to become a true node and the EU is to benefit as a whole, it needs to work with the EU to invest in infrastructure at the border to increase frequency.

Left:

Poland & CEE:

Co-building the belt & road

- Dr. Christian Kuhn, Chairman of the Board of Directors of Kazakhstan Temir Zholy (KTZ); - Steffen Bobsien, CEO of DB Cargo Polska; - Dr. Krzysztof Senger, Executive Vice President of PAIH

Robert Dobrzycki, CEO, Panattoni Europe:

Currently, we don't see a lot of tenants linked with the BRI – and we have properties everywhere.

Radosław Pacewicz, Vice President of the Office of Rail Transport (UTK):

55% of westbound traffic in Poland travels directly to Germany and less than 1% of Polish rollingstock leaves the borders of Poland along the North-South route. Does Poland want to remain a transit site between the East and Western Europe?

Dr. Carsten Hinne, CEO, DB Cargo Eurasia:

The business model is not based on train traffic but TEUs and frequency.

Dr. Wulf Meinel, CEO, Frasers Property:

Global money will rather seek deeper than smaller markets, meaning Poland is set to outperform the other CEE countries simply by virtue of its size.

Left:

- Yao Dongye, Deputy Chief of Mission of the Chinese Embassy in Poland

Right:

- Robert Dobrzycki, CEO, Panattoni Europe; - Dr. Wulf Meinel, CEO, Frasers Property; - Dr. Carsten Hinne, CEO, DB Cargo Eurasia; - Radosław Pacewicz, Vice President of the Office of Rail Transport (UTK)

photos: Piotr Kała

84

MultiModes, one goal

planes, trains and autoMobiles

Logistics is not a one-size-fits-all industry with each mode playing its own niche part in global supply chains. It all boils down to costeffectiveness and – in the case of forwarding – it’s the customer that ultimately determines the mode.

Polityka Insight’s Adam Czerniak led a ‘get-to-know-you’ tour through the mega Solidarity Transport Hub project, which aims to combine a 40-55 million capacity passenger airport with motorways, regional trains and a high-speed trans-European rail network.

Thomas Kowitzki, Head of China Rail

Piotr Malepszak, Acting President of the Solidarity Transport Hub Poland:

The third alternative of rail is now coming in. Customers love it. They would like to have the choice.

Reaching speeds of up to 350km/h, the €7.5bn high-speed airport line is expected to transport passengers between Warsaw and the airport in 15 minutes.

Michał Grochowski, Cargo Director, LOT Polish Airlines:

Marta Fredrych, Associate, Baker McKenzie:

Why did Alibaba choose Belgium as a hub and not Poland? Why did Huawei choose the Netherlands? The short answer: the flexible VAT regimes in each of the other two locations.

In a potential Private-Public Partnership (PPP) model, the financial risk could be split according to each partner’s competencies.

Jozsef Kossuth, Senior Cargo Manager,

Rafał Milczarski, CEO, LOT Polish Airlines:

I’ve lost count how many times I’ve travelled to China in the last 2-3 years. We signed cooperation agreements with airports in China and entered joint projects with airlines from China. And we’ve managed to increase our traffic by 60% in three years.

Warsaw Chopin Airport is already at capacity and if the Solidarity Transport Hub is to serve the region, the total amount of passenger and freight traffic will only increase. In that case, the hub’s intermodal model is the most efficient solution to cater to the increased traffic at comparative lower Co2 emissions.

Multimodal/Europe, DHL Global Forwarding:

Budapest Airport Zth:

Philip Evans, Secretary General of the UK-based European Freight & Logistics Leaders’ Forum:

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Left:

- Jozsef Kossuth, Senior Cargo Manager, Budapest Airport Zth; - Philip Evans, Secretary General of the UK-based European Freight & Logistics Leaders’ Forum - Frank Schuhholz, CEO of FMS Advisers and a foremost expert on global transport and logistics

Logistics leaders take the best value option as long as it’s stable. They talk about innovation and new ideas, but at the end of the day they fall back on what they know.

Carsten Pottharst,

Managing Director, InterRail Europe:

Back in 2017, when the number of trains was at a lower level than today, transit times were stable at around 15-17 days. But in 2019, lead times have suffered due to the lack of infrastructure at border crossings.

Below:

Piotr Malepszak, Acting President of the Solidarity Transport Hub Poland

Left:

- Carsten Pottharst, Managing Director, InterRail Europe; - Michał Grochowski, Cargo Director, LOT Polish Airlines; - Jozsef Kossuth, Senior Cargo Manager, Budapest Airport Zth; - Thomas Kowitzki, Head of China Rail Multimodal/Europe, DHL Global Forwarding; - Philip Evans, Secretary General of the UK-based European Freight & Logistics Leaders’ Forum

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law of the jungle Financing was the main theme for this panel, but it had it all, including elephants, tigers, monkeys… and of course, key insights into the current China-US trade tensions, as well as invaluable advice about doing business with the Chinese both in Europe and China.

Volker Friedrich,

Kustaa Valtonen, Co-Founder of the FinEst Bay Area project:

Apart from their need to save face, the Chinese also like to ask: how do I make more money?

When Peter told me that we’re going to build a tunnel, I asked him how much he needed. ‘€15bn,’ he said. ‘OK, give me a few days,’ I replied.

Bartosz Komasa, Head of Corporate Relations, Bank of China:

Dr Andrzej Juchniewicz, Chief Representative of the Shanghai office for PAIH:

Founder & CEO, GBP International:

My boss told me a Chinese saying to sum up the current global trade tensions: when two tigers fight, the monkey will observe from the tree and then join the winner of the fight.

The initiative is a 50-year project which is only in its 5th year. The issues of today may have no bearing in 10 to 15 years.

There is a long way to go.

Dr. Chen Chen, Budapest-based China Special Advisor, Baker McKenzie:

Left:

- Dr. Chen Chen, Budapest-based China Special Advisor, Baker McKenzie - Bartosz Komasa, Head of Corporate Relations, Bank of China - Kustaa Valtonen, Co-Founder of the FinEst Bay Area project - Volker Friedrich, Founder & CEO, GBP International - Dr Andrzej Juchniewicz, Chief Representative of the Shanghai office for PAIH

photos: Piotr Kała

Poland & CEE:

Co-building the belt & road

The BRI is just an ‘initiative’.

It’s up to each country, region or economic block in how they interpret and receive the BRI.

saving the planet one €15bn tunnel at a tiMe Peter Vesterbacka, the Finnish visionary of Angry Birds fame, held the audience in awe as he explained the inception, progress and details of constructing the longest undersea tunnel in the world, which will also feature an artificial self-sustainable island with hotels, housing developments and a convention centre.

talk the talk Having mapped out the BRI in Europe over the two days, a consensus seemed to be reached: with such a large challenge but multiple opportunities ahead, the CEE region – together with the rest of Europe – must present a unified front, one built on cooperation and transparency in order to benefit best from this global initiative.

Peter Vesterbacka, Co-Founder of the FinEst Bay Area project:

Prof. Jana Pieriegud, Warsaw School of Economics (SGH):

The island is self-sustained as far as energy and food is concerned. No cars. We are already in talks with many people in Africa about using this as a blueprint for sustainable urban development. In a way, as a side project, we’re saving the planet.

On a global value chain basis, Poland and Russia enjoy the highest connectivity through the BRI.

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Bartek Pastwa, Board Member of Port of Rijeka in Croatia:

The BRI offers a historic opportunity for everyone to win through cooperation.

Renata Osiecka,

Managing Partner, AXI IMMO:

Time to turn all the talk and ideas into joint action.

Above:

Peter Vesterbacka, Co-Founder of the FinEst Bay Area project

Right:

- Prof. Jana Pieriegud, Warsaw School of Economics (SGH) - Bartek Pastwa, Board Member of Port of Rijeka in Croatia - Peter Vesterbacka, Co-Founder of the FinEst Bay Area project - Renata Osiecka, Managing Partner, AXI IMMO - Frank Schuhholz, CEO of FMS Advisers - Richard Stephens, Founder & Editor, Poland Today

Below: Breakout sessions allowed greater discussion between the participants on the topics and issues surrounding the BRI.

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Let the good times roll Record highs and strong demand continue to boost the real estate sector in Poland.

In hIGh DemanD 2018 was the best year in the history of the Polish Investment and Trade Agency (PAIH), paralleled by a real estate market which also witnessed record highs. During the first panel, hosted by PAIH and moderated by Richard Stephens, Founder and Editor of Poland Today, market and government leaders sought to answer the two all-important questions: why was this so, and will it continue?

Poland’s real estate market does not operate in a vacuum – various sectors and factors contribute to its position as a dynamic place for investment. At the 30th edition of MIPIM, the world’s leading property event, Poland Today led the Polish conference content for the fifth year running. Politicians, investors, proptech gurus and developers met in Cannes to discuss opportunities for companies and cities in Poland.

Tadeusz Kościński, Undersecretary of State at the Ministry of Entrepreneurship and Technology (now Deputy Finance Minister):

Poles are returning from abroad and realising that it’s a very vibrant economy with lots of opportunities.

Krzysztof Senger, President of the Polish Investment and Trade Agency (PAIH):

With over €2.1bn of investment in manufacturing and the business service sector, 2018 was a record year for Poland in attracting foreign investment.

Monika Rajska-Wolińska, Managing Partner, Colliers International:

Investors are also turning their attention to regional markets such as Kraków, Wrocław, Lublin and Gdańsk where they find a talent pool of well-educated people who speak different languages, a good quality of life and sophisticated services.

Marcin Juszczyk, Member of the

Management Board at Capital Park:

Poland Today at MIPIM 2019

It’s a great privilege to build a project like Art Norblin, but it’s also a big responsibility because it’s an important part of a dynamic district in Warsaw.

Above:

- Richard Stephens, Founder & Editor, Poland Today - Tadeusz Kościński, Undersecretary of State at the Ministry of Entrepreneurship and Technology (now Deputy Finance Minister) - Krzysztof Senger, President of the Polish Investment and Trade Agency - Tobias Hemmann, CREM Special Projects & Asia Pacific, Daimler - Monika Rajska-Wolińska, Managing Partner, Colliers International - Marcin Juszczyk, Member of the Management Board at Capital Park

89

Room foR moRe The logistics sector is experiencing record highs in the CEE region, but along with the opportunities, challenges lie ahead. During the European logistics investment panel at MIPIM, moderated by the omni-present Richard Betts and hosted by Real Asset Media and Poland Today, an assortment of big market beasts from across the continent discussed the massive and relentless changes that the logistics sector is undergoing and what this means for investors, developers, service providers and end-users.

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Frank Schuhholz, CEO of FMS Advisors and a global expert on logistics:

Raimund Paetzmann, Vice President Corporate Real Estate, Zalando:

China’s Belt & Road Initiative (BRI) will cause major changes to the European logistics landscape but many questions still surround the potential routes and shape of the initiative.

Fast reaction times are important in the fashion sector and therefore producing in China is not always the best option. The country will always play an important role, but there are other countries closer to Europe with factories that are even closer to the final customer, so that’s also a trend.

Not everything is coming from China.

Robert Dobrzycki, CEO, Panattoni Europe:

Kevin Mofid, Director of Commercial

It’s been another record-breaking year in Europe in terms of volumes and net absorption. Vacancy rates are going down, but construction costs continue to rise and land is becoming more and more scarce.

Joseph Ghazal, Managing Director and

Chief Investment Officer, Prologis Europe:

We see the momentum really continuing and our investors are actually increasing their allocation to logistics real estate.

If anything, all of them are under-allocated in the logistics sector.

Research, Savills:

Online sales are definitely a driver for logistics, but they’re not the only one – most of our leasing is done for non-online customers and for typical regional big-box customers that we shouldn’t forget.

Bartek Tulejko, Partner, M4 Real Estate:

Poland is the place for regional distribution which isn’t focused on domestic consumption but more on customers in Germany primarily, but this is going to change.

Renata Osiecka, Managing Partner, AXI IMMO Group:

In terms of interest from the East, Asian funds have been very active in Poland.

Although Asian occupiers are not very visible, more are expected to arrive in the next couple of years.

Dr. Wulf Meinel, CEO & Managing Director, Frasers Property Europe:

photos: MiPiM, Monica Zielinski (Poland Today)

There’s quite an attractive market for newly created products, whereas there is not much rental increase for existing or outdated stock unless it is located in very important areas.

However, the industry still faces challenges such as scarcity of land, permit delays and lags in the political system.

Left: Frank Schuhholz, CEO ofFMS Advisors and a global expert on logistics

Below:

- Joseph Ghazal, Managing Director and Chief Investment Officer, Prologis Europe - Kevin Mofid, Director of Commercial Research, Savills - Raimund Paetzmann, Vice President Corporate Real Estate, Zalando - Renata Osiecka, Managing Partner, AXI IMMO Group - Dr. Wulf Meinel, CEO & Managing Director, Frasers Property Europe - Bartek Tulejko, Partner, M4 Real Estate - Robert Dobrzycki, CEO, Panattoni Europe

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WeLcome to WaRsaW

Look no fuRtheR

During an on-stage interview with Richard Stephens, the Mayor of Warsaw, Rafał Trzaskowski, said the city is now focused on attracting smarter investments that will focus on sustainability and improving the quality of life, only adding to the allure of the capital as one of the most dynamic cities in Europe.

Tomasz Trzósło, Managing Director CEE at JLL, presented a snapshot of the dramatic real estate development changes in Polish cities over the last 10 years. Over the decade, a number of regional cities, including Kraków and Wrocław, have become attractive and important spots on the European office market - in fact no other countries come close to the pace of office development in Polish cities.

Rafał Trzaskowski, Mayor of Warsaw:

Tomasz Trzósło,

Developers and city officials seem to be on the same page when it comes to focusing on how people spend their time, creating green spaces, adopting eco-friendly practices and improving the overall standard of living. We've got incredibly talented people with wonderful ideas, lots of startups, and a lot of companies that want to invest in technology and smart solutions for cities. We’re investing in these people, which is fantastic.

Quality of life, education, culture and transport connectivity have all improved immeasurably. This has been possible because of the growth of employment, in turn driven by investors - especially from the business services sector - coming to Poland and creating a lot of jobs.Two cities which have done a fantastic job in recreating their city centres are Łódź and Katowice.

Managing Director CEE, JLL:

Right: Warsaw at-

Above: Tomasz Trzósło, Managing Director CEE, JLL Left: Rafał Trzaskowski, Mayor of Warsaw and Richard Stephens, Poland Today

photos: MiPiM, Monica Zielinski (Poland Today)

Poland Today at MIPIM 2019

tracted investors in Cannes for the 21st time and this year, the City was accompanied by 13 partners, who presented their products and services.

Left:

Richard Stephens, Founder & Editor, opens Poland Today's sessions at MIPIM 2019

When tech takes oveR There’s no stopping Poland’s large, dynamic and independent-minded cities. As business continues to boom and investments pour in, experts from various sectors discussed how these cities are handling rapid growth, advances in proptech, the sharing economy and social, economic, transport and infrastructure changes, in a panel moderated

by Julia Arlt, Global Digital Real Estate Leader, PwC.

Nicklas Lindberg, CEO, Echo Investment:

Technology is important, but people still need places to meet, socialise and integrate, because technology is taking over parts of our lives.

Jacek Wachowicz, CEO, Immobel Poland:

A lot of companies have been relocating to Poland for various reasons, be it Brexit or the allure of its skilled, dynamic workforce, while domestic companies have also been expanding.

Aaron Block, Co-Founder & Managing Director, MetaProp NYC:

A lot of companies look at Poland for outsourcing tech and there are many opportunities for implementing innovative solutions in new buildings, compared to Western Europe where the infrastructure has already been built.

Above:

- Aaron Block, Co-Founder & Managing Director, MetaProp NYC - Jacek Wachowicz, CEO, Immobel Poland - Nicklas Lindberg, CEO, Echo Investment - Roelof Opperman, Principal, Fifth Wall Ventures - Sean Tompkins, CEO, RICS - Alina Prawdzik, Managing Partner, Innogy Innovation Hub - Adam Pustelnik, former Director of Investor Service and International Cooperation Bureau, Łódź

Roelof Opperman, Principal, Fifth Wall Ventures:

There are a number of companies and funds that focus on smart cities, but the challenge from the VC perspective is finding investments that turn into good businesses with high returns - and that doesn’t always translate into strategic ROI for the city. That’s where corporate VCs can step in.

Alina Prawdzik, Managing Partner, Innogy Innovation Hub:

A lot of technology actually improves costs significantly on things like energy and occupancy. So it doesn't have to cost extra.

It actually can deliver savings. And there are technologies now that can improve air quality significantly, which is an important trend.

Sean Tompkins, CEO, RICS:

How do we really think about smart in a way which is about people? It's about cities where people really want to live and where people are going to be happy.

It's about cities that are going to create engagement - that are sustainable, prosperous and inclusive.

Adam Pustelnik, former Director

of Investor Service and International Cooperation Bureau, Łódź:

It’s important to attract talent and create a smart city that’s people-centric, but it comes at a cost. Łódź spent approximately €1bn of EU funding on upgrades and improvements to the city centre.

92 sports

King of the river After trading the Vistula River for the Thames, Polish Olympic rower Natan Węgrzycki-Szymczyk became a part of boat race history when his Cambridge team won the esteemed contest.

As a kid, Natan Węgrzycki-Szymczyk

Natan Węgrzycki-Szymczyk is a Pol-

ish competitive rower.

The Krakow native competed at the 2016 Summer Olympics in Rio de Janeiro, in the men's single sculls.

He was in the stroke seat of the winning Cambridge Light Blue boat in the 2019 Boat Race. Natan holds a bachelor’s from the University of California, Berkeley and a master’s from Cambridge University.

do my degree and compete.” During watched his father on the water par- his first year of studies, he rowed in race on the thames ticipating in Krakow’s rowing club and the eights and won the US National Each year, the Cambridge University Boat his fascination with the sport only grew Championships, and then competed Club and the Oxford University Boat Club with age. What was once a favourite in the 2016 Summer Olympics in Rio de compete in this rowing race on the Thames in London. This is one of the biggest spectapastime with friends from high school, Janeiro, in the men's single sculls. tor events of the British sporting calendar turned into a serious passion and he With ambitions to attend Cambridge and more than 250,000 people take the banks soon realised he was actually pretty University for his masters, Natan of the river to watch. Also known as the Unigood at it. Ten years later, the 24-year- needed to maintain high marks dur- versity Boat Race, the men's race was first held old’s team won the prestigious Oxford ing his senior year, while continuing in 1829 and the course runs 6.8 km from Putney to Mortlake. Cambridge led the head-to-head and Cambridge Boat Race. Even now, to row and train intensively. The hard with 84 wins to Oxford’s 80. medal around his neck, he still can't work paid off and Natan headed to believe that rowing has got him this far. Great Britain to continue his education. unique because hundreds of thousands To backtrack, Natan wanted to pur- While attending Cambridge, he par- of supporters gather on the banks of sue rowing but also earn a degree. ticipated in this year’s traditional Boat London’s iconic River Thames and traAfter winning the Junior World Race in April and was in the stroke seat dition is a big part of it.

Championships in a single scull, he was of the winning Light Blue boat. “The Rowing hasn’t exactly garnered as accepted by the University of California, Boat Race was pretty incredible,” said much enthusiasm from Polish sports Berkeley, to study sociology. With Natan. “The event is well-known in the supporters, however. “It’s definitely the uncertainty that comes with being rowing community, but I didn’t realise a niche sport [in Poland] when you an athlete, Natan wanted to develop his just how big it is in wider circles. Even compare it to the US, UK and other skills on and off the water. “You never when you’re at the Olympic Games European countries like Germany,” said know what’s going to happen – one year you don’t get such hype around the Natan. “Mostly when people see rowing, you’re on the national team, next you’re race.” He added that the Boat Race is they confuse it with canoeing, which is shown the door. Someone told me that too bad considering Polish rowing has rowing can get you up to 40 years old had a lot of success in the last 20 years.

We’ve won medals at every Olympics. but then you need to do something until you’re at least 80.” Unlike his countryThere are around 1,000 athletes rowmen who train with the national team ing in Poland while at Cambridge alone there are around 500 people competonly 200 days a year, Natan was able to attend university full time and keep ing.” Not willing to quit while he’s ahead, up with rowing for the whole year. “Of Natan said he will continue training for course, it’s hard to do everything 100%,” next year's regatta. Maybe then he'll said Natan, “but I have to say that I was finally accept that he’s going places. very successful with it: I managed to interview by Jacek Ojrzyński

‘Mostly when people see rowing, they confuse it with canoeing’

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Reaching the summit

history

Nepal, 17 February 1980, first winter ascent of Mt Everest

Krzysztof Wielicki,

will be guest of honour at the 6th CEE Summit Gala Dinner on 29 October in Warsaw. See page 4.

Krzysztof Wielicki (l) and Leszek Cichy (r),

It's a well known fact

that Sir government of Nepal had never before Edmund Hillary from New Zealand, granted permission for a winter climb accompanied by sherpa Tenzing Norgay and, when the permission finally arrived of Nepal, were the first to reach the (after almost being pipped to it by the 8848m summit of Mount Everest. That Italians), it stipulated that only six weeks the first winter ascent of the fabled peak were granted to attempt the climb. was carried out by a team from Poland is To add to the pressure, the permit arrived not so well known, even amongst Poles. unexpectedly on 22 November 1979 (the Led by the legendary Andrzej Zawada, team had only a couple of months earlier who had been inspired by the first been granted a spring permit, so they European woman to climb to the top, assumed the application for a winter Wanda Rutkiewicz, the two who actu- permit had failed)… and was valid from ally reached the summit were Leszek 1 December! As it turned out, nothing Cichy and Krzysztof Wielicki. These - not even a serious lack of money - would are the words of Andrzej Zawada from stop them. In 2002 Wielicki issued his his later written account of the climb: Winter Manifesto (manifest zimowy), “Then, finally at 2.25pm, the voice of challenging a new generation of Polish Leszek Cichy resounded over the radio: mountaineers to summit all 8000-metre ‘Guess where we are!’ We were out of our peaks unclimbed in winter: “If you could minds with happiness – totally sponta- pull it off, wouldn’t it be great? Can you neous and unrestrained. It was the most imagine that? All 8000-metre peaks wonderful moment of our lives.” In the conquered for the first time in winter, account, Mr Zawada related how the all by Poles.” by Richard Stephens

photos from the winter ascent of MT Everest: Bogdan Jankowski (Forum), portrait of Krzysztof Wielicki: Lukasz Sokol (Forum)

the first two climbers ever to reach the summit of Mount Everest in winter, pictured shortly after descending from the top.

96 culture

Chałka and Vegemite Actor-singer Jacek Koman lit his own path between cultures and arts, from Łódź to Perth, ‘Moulin Rouge’ to folk-rocker, all the way to Hollywood and back. But a close shave with the secret police might have quashed his career before it started.

jacek koman Jacek Koman is a Polish-Australian actor and singer known for his roles in ‘Moulin Rouge!’ (2001), ‘Children of Men’ (2006) and ‘Defiance’ (2008). He is also the frontman of the band VulgarGrad. He splits his time between his home in Melbourne and Poland,working as an actor in both countries.

He sang ‘Roxanne’

with Ewan McGregor as a narcoleptic Argentinian tango dancer in ‘Moulin Rouge!’.

He gave refuge to Clive Owen in the year 2027 as a farmer/freedom fighter in ‘Children of Men’ and as another gruff farmer, he hid Daniel Craig and other Jewish refugees in the WWII-resistance film ‘Defiance’. More recently, he has been leading a posse of Russian outlaws around Australia and Europe as the lead vocalist of the band VulgarGrad. It has certainly been a wild and colourful ride for Jacek Koman, the Polish-Australian actor and singer, ever since leaving Poland on the brink of Martial Law. But it could have come to nought had he not managed to give the secret police the flick while studying drama in Łódź.

“They didn't have much on me,” says Koman with the beginnings of a wry chuckle. “They appealed to my patriotic feelings. And they told me that as

Bringing the thea-

tre to music, Jacek Koman on tour in Europe.

Below: VulgarGrad

is a Melbourne band that plays Russianstyle music and was formed in 2004.

Jacek Koman is the band’s lead singer.

an extra reward, I would always be able to afford coffee and cake.” Despite the ‘sweetner’, he kindly declined the goons’ offer of becoming an informant of the Polish People’s Republic.

Runs in the family There was a touch of fortune to Jacek Koman’s entrance into the world. He was born on 15 August 1956 in BielskoBiała, Southern Poland, on a sacred day in the Polish calendar, celebrating both the Assumption of Mary and Marshal Piłsudski’s famous victory over the Soviets in 1920. More importantly, he was born to actor parents, who dragged Koman and his older brother Tomek around Poland from one theatre to the next. He spent his childhood between Bielsko-Biała, Koszalin, Szczecin and Łódź where he would ultimately study drama between 197478 at the famous National Film School.

After graduation, he played Lysander in a production of ‘A Midsummer Night's Dream’ and debuted with Juliusz Machulski (of ‘Kiler’ fame) in the director’s first film ‘Bezpośrednie połączenie’ (Direct Connection). But the writing was already on the wall as the economic hardship and political coercion amplified under the Communist regime.

For 25-year-old Koman, it wasn’t necessarily his run-in with the secret police but a burning drive for freedom that

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provided the final straw. “For start- Roy Cohn. There was some Beckett, worlds. “And in Poland, I'm not limited like that. My limitations are different: ers, freedom to travel,” says Koman. “It ‘Waiting for Godot’. Some Brecht.” wasn't so easy each time you wanted In 1994, he played Claudius in my age, what I look like. I run hospitals. culture to go abroad. You had to apply for ‘Hamlet’ with Cate Blanchett, Geoffrey I am an attorney.”

He travels between the two couna passport and wait, biting your finger- Rush, David Wenham (‘Lord of the nails ... I didn't like that. And the world Rings’) and Richard Roxburgh (‘Mission tries quite often, but even in Australia, was calling, so it was partly an adven- Impossible II’) at Sydney’s famous the home country is never too far away. ture to explore the world and partly an Belvoir St Theatre. This Class of ‘94 His family celebrates Wigilia (Christmas escape from the oppression.” would, of course, go on to win interna- Eve) and other Polish holidays. All the By some miracle, he and his brother tional acclaim and awards in some of twelve dishes are laid out on the Tomek managed to obtain passports the most celebrated films of their gen- Koman dinner table, except for carp. and left in 1981, only months before eration. It was during a production at He draws the line on carp. The family’s the imposition of Martial Law. They this same theatre that Koman received favourite is the custom of laying out a spent eight long months fending for his own big break when the director Baz plate for loved ones past or not prethemselves in Austria before land- Luhrmann cast him in ‘Moulin Rouge!’. sent. The only problem was that these ing visas to Australia and a new life in Landing your first big role in a block- dinners had become so popular that Perth. 38 years later, he uses the word buster is one thing; playing a Roxanne- the space was quickly taken up with ‘euphoria’ to describe the experience singing, tango-dancing Argentine what he calls “Wigilia orphans”. and yet words seem superfluous. It’s bohemian with a sleep disorder is quite all in his voice, the pitch of his trade- another. He had to dig deep, all the way Back to the homeland mark drawl rising. “After months and back to drama school in Łódź. Along He will be returning to Poland in autumn months of waiting in limbo with no sta- with judo, fencing, skiing, horse riding, to film a yet-to-be-titled Netflix series tus in Austria, we were praying to be he had to endure four years of classical and next year, he hopes to tour with dropped anywhere, naked in the middle ballet under the instruction of a tough his larger-than-life band VulgarGrad. of a desert. But it was even better,” he taskmaster who he affectionately calls The official line is that the band is William Burke is says, laughing. “We still kept our clothes the “ballet Nazi”. He literally found his inspired by the old folk songs of Russian an Australian writer based in Warsaw. In and were dropped in the middle of sum- singing voice in the shower and nailed thieves (blatnie pesni) and a little bit of 2010, he brought the mer in Western Australia. Yeah, that the part. “That's what I keep telling Perestroika-era punk. With Koman’s WWII-rescue story was enough of a cause for euphoria.” my son: the bigger the challenge and growling bass tones, one reviewer of Albert Göring to the tougher the experience, the more described the sound as something the world in his book Thirty Four and the Changing directions you think fondly about it afterwards. like ‘a Soviet Edith Piaf with a flickBBC documentary After a crash course in the English (and I remember coming out the other end knife’ after receiving singing lessons ‘Goering’s Last Secret.' from Tom Waits. Polish audiences will He has studied in Australian) language, he entertained and that’s how it was for me.” the idea of studying science and winHe also received his first look into the detect a bit of Ska or Klezmer music. the US and Australia, ultimately obtaining ning a place in medicine, but the plan ‘take-no-prisoners’ world of Hollywood Whatever the genre, every perforan Honours degree in proved to be overambitious for the business. His rendition of ‘Roxanne’ mance is a sweaty and heartfelt riot into Economics (Soc. Sc.) newly-arrived refugee. “Yeah, I didn't eventually made the official ‘Moulin another world where the theatre is as from the University do too well.” He instead worked a series Rouge!’ soundtrack and his agent palpable as the music. All in costume of Sydney. He has lived in Poland since of jobs: tiling work, bartending, selling promised him huge royalties after the with singing mostly in Russian, they 2014, researching and fruit and even a stint on a cattle station. CD sold in the millions around the world. swing out songs with fun and eclec- writing, among other Meanwhile, his friends and family back Sure enough, his first royalty statement tic titles like ‘Solomon Pylar’s School projects, his second home were practically locked away arrived and just when he was about of Ballroom Dancing’, as well as some WWII epic. behind the red seal of Martial Law. Not to jump for joy, he read the fine print. Polish songs, such as the ‘Ballad of an able to call his parents or freely write to The studio had charged him for the Emperor’ from their new album ‘The them, he felt the oppression even as far use of the recording facilities at a rate Odessa Job’. The choice of venues also as Perth. Still, he found homely respite in nearly double the amount of his royalty adds to the spectacle. On their last tour a theatre group that he and his brother cheque, meaning he actually owed the to Europe, the band played in a dive bar established with a couple from Poland, studio money. “My brother and I were on Hamburg’s infamous Reeperbahn Krzysztof and Marta Kaczmarek, who planning to shoot a mockumentary set and in Copenhagen’s hippy-commune would also move on to the silver screen. in Bangkok where I run this stall and sell of Christiania. “We played in a shed so “We just started working on some stuff bootleg copies of ‘Moulin Rouge!’,” he full of dope smoke that by the time we out of the need to do it and gradually says, now able to laugh about the mat- had finished unloading our equipment we got funding for some projects.” He ter. To the inevitable police enquiries, we were off our faces,” he says. “Dogs later moved to Melbourne and hit the his character had the perfect lament in running around, groups of Inuit people. bigger stage. “The ‘90s were for me a store: “I'm sorry, I know I’m breaking the It was actually someone's wake.” decade of intense theatre work with law, but I owe these gangsters money.” The question comes up whether he But that fiasco was quickly forgot- thought about what would've hapa ew great directors, fantastic theatre companies and good material… There ten when other big films came his way: pened had he stayed in Poland. “Maybe was ‘Angels in America’ in the role of ‘Children of Men’ (2006), ‘Defiance’ I would have become a businessman,” (2008) and Baz Luhrmann’s ‘Australia’ he says, before bringing up a childhood (2008) being the pick of the bunch. business venture he had run as a sixHe also had the opportunity to return year-old at summer camp. He would home and act in several Polish produc- peel thistle balls and sell them to other tions, such as ‘Lekarze’ (Doctors), HBO’s boys for the foosball table. “I would ‘Wataha’ (Wolfpack), ‘Prokurator’ (The enter camp with five złoty to my name.

Prosecutor), ‘Ziarno prawdy’ (A Grain By the time my father came to pick of Truth) and Chyłka-Zaginięcie (Chyłka me up, I would have 40 zł,” he says, Lost). “In Australia, I tend to be cast as releasing one last throaty laugh. “So a villain, the gangster, the rapist,’ he in business, I could have become says, noting the stark contrast of the the global producer of foosballs.” roles he receives between the two

by William Burke

‘I'm sorry, I know I'm breaking the law, but I owe these gangsters money’

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foreign impressions

'Poland made me the man I am today' With a former professional athlete’s mindset, Walid Barsali found himself in a Polish blue ocean of opportunities which led him to co-found BallSquad, the first online sports venue booking service in the country.

Walid Barsali was born in Algeria but

was raised in Paris, France. The 29-year-old is the Co-Founder and CEO of BallSquad – a sports-tech company which focuses on the improvement of management and booking of public sports facilities in Poland and the CEE region. He has an MBA in Marketing Communication from Clark University in Boston.

In addition to his native French, he is fluent in Arabic and English.

True to his roots,

Walid continues playing sports and participated in the finals of the Polish International Basketball League.

BallSquad won

the top prize at the Mazovian Startup finals. Walid pitched his company to investors and received 20,000 zł to expand his business.

Why did you decide to move to Poland?

While I was getting a BA in Business Administration and Economic Sciences, I did an Erasmus exchange in Romania and afterwards, I was quite sure that I wouldn’t go back to France. I thought about the entrepreneurial life and instead of working at a corporation, I wanted to do something on my own.

Romania opened my eyes to that. I saw that the CEE region had new markets, skilled labour, capacities as good as in Western countries, but the markets have even more potential and less restraint. In France, there’s a lot of competition, and you have to go through endless unpaid internships just to get your first miserable job.

I didn't want that for myself and for my life. Poland was kind of an easy decision. I was already with my girlfriend, Dorota, who was returning to Poland, so things fell into place and I’ve been here for six years.

How was your first day in Poland?

I arrived in July 2013 and it was extremely hot – 35 degrees. I thought I came to Poland, not to Africa. And I know what I’m talking about because I’m half-Algerian.

What was your first impression?

I found my first job at Fujitsu as an IT consultant in Łódź, which has its own kind of culture. When I came in 2013, the city had yet to experience the major revitalisation work that it has seen more recently over the past five years. Many of the buildings in the city centre were in bad shape, which doesn't make a great impression when you're moving to a new city. But it was an adventure.

You arrive in a place that you absolutely don’t know and my only objective was ‘let’s see!’. Prior to starting this job, I was

‘Both countries [Poland & France] are very dynamic and ambitious at their core’

only paid to play basketball so the shift was extremely big but exciting.

What are some similarities between Poland and France?

Both countries are very dynamic and ambitious at their core. Even though their respective worldwide rankings are different, from where I'm standing and after six years in Poland, I can say with confidence that both countries are reaching for the same things, such as a highly-skilled population, advanced infrastructure, a strong foothold and influence on the international scene.

What was the hardest part about starting your business?

In our specific sector, we knew that we had no data to rely on. No one had done something like this before in Poland. It was tough to create everything from scratch, detail by detail.

With BallSquad, sports enthusiasts can reserve fields, courts and halls through the online sports venue booking service.

We are standardising this process for all venues and users to make the contracting happen online via our mobile app.

Our main objective is to get rid of the paper contracting which is impractical for all parties because it requires users to manually research available facilities, directly contact venues, negotiate and physically sign a contract. Whereas with the app, it’s simply a few clicks and you’re done. Unfortunately, there are some misunderstandings regarding what our service is about so our startup journey is far from complete. We are still climbing our way up and working really hard on it. So far, we have won the 'Mazovian Startup' competition.

What are your plans for the future?

Right now and for the rest of my life, Poland will remain my anchor.

I don't think that I will ever be able to detach myself from this country. I will always be grateful for the people who live here and for this culture because it made me the man I am today. Poland will always be our headquarters, but Dorota and I would like to move around a bit and shape our lives all around the globe. For us, travelling is enjoyable and we want our kids to have more opportunities to open their minds.

interview by Anne Galat

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