Polish Market No. 238/2016

special edition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

special edition

No. (238) /2016 :: www.polishmarket.com.pl

economic cooperation

poland

iran

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25

special edition

RELATIONS BETWEEN POLAND AND IRAN ARE A SPECIAL EXAMPLE OF GOOD INTERNATIONAL RELATIONS GOING BACK MORE THAN HALF A MILLENNIUM

W

E HAVE NEVER BEEN NEIGHBOURS AND OUR COUNTRIES ARE TWO THOUSAND KILOMETRES APART. WE HAVE ALWAYS HAD DIFFERENT RELIGIONS, CUSTOMS AND LANGUAGES. SO WHENCE THIS UNUSUALLY LONG LIST OF POSITIVES? The largest number of Iranian (Persian ) artefacts in Europe can be found in Poland, despite the fact that our country’s heritage has suffered at the hands of various invaders almost like no other country. What is important, unlike the custom in the rest of Europe, our collection does not come from theft or colonial exploitation, but has been acquired peacefully: through trade, or collecting. The first great works of Persian literature were translated for the benefit of Europe by Poles, just like the first European edition of Persia’s history. This gesture was reciprocated. “The Crimean Sonnets” by Mickiewicz were first translated into... Farsi.

Of course, culture was the superstructure, a result of bilateral trade conducted at a scale almost unseen elsewhere in the 16th and 17th century. The fashion for Persian carpets, weapons, jewellery and horses gripped the nobility, including aristocrats and the less wealthy representatives of this estate. The development of bilateral relations benefited from the multi-ethnic and tolerant character of both States,which was something unusual in that period. As an example we could cite the first Persian mission to Kraków in 1474, led by a learned Sephardic Jew, who then decided to stay in Poland as the physician to four consecutive Polish kings. The opposite is also true.

Poles made similar careers at the court of Persian rulers, becoming authorities in contacts with the Christian world.

Of course, one could say that these relations were based on political interest, that is opposition to the aggressive Ottoman Empire. This is true. For instance, Jan III Sobieski received the title of Jihad Knight. However, this is far from being the complete truth. Neither Persia, nor Turkey had ever recognised the partition of Poland. During official functions for ambassadors in Persia and Turkey there was always a place set aside for “Envoys from Lechistan (Poland)”. Throughout the entire 19th century both countries remained a safe haven for political refugees from the occupied Poland who took advantage of the work opportunities given to them, with some filling the highest State positions. In the 20th century Iran earned our particular gratitude by hosting over 150,000 Polish refugees – the army of General Anders and the accompanying civilians evacuated during the Second World War from the USSR. Is there a chance for continuing these good relations today? The older generations of Poles and Iranians probably still remember the role played

by Polish firms in the development of the Iranian economy in the years 1960-90, particularly the cement, metallurgical and power industries. Projects completed during that period included the power station in Bakhtaran, a cement plant, a steel plant and a rolling mill, as well as two petrochemical complexes. Later, this co-operation stopped with both countries focusing on defining anew their independence, economic system and international relations.

Today, this difficult period appears to be behind us and the opening of the Iranian economy stimulates the imagination of many entrepreneurs, also in Poland. The Iranian economy is among the fastest-growing economies in the Middle East and one among just a handful in the region which also develops sectors unconnected with oil. Polish companies know that this is a great chance for sales of thousands of railway cars, public transport vehicles, tractors for farming and cosmetics, as well as large volumes of food, especially poultry and beef. However, this does not stop at sales.

The Polish offer also includes investment co-operation making use of Polish environmental protection or agricultural processing technologies, bioand nanotechnologies.

The first steps have already been taken. The governments have signed the necessary agreements, business organisations are sending trade and business missions. Increasing numbers of entrepreneurs from both countries present their products and services at fairs held in Iran and Poland. The number of places available during those events and business trips continues to lag behind the number of those who would like to take part in them.

One would be hard-pressed to find a better omen.

Krystyna Woźniak-Trzosek Editor-in-Chief President Rynek Polski Publishers Co. Ltd.

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CONTENTS

4. Radosław Domagalski-Łabędzki, deputy Minister of Economic Development: “WE WANT TO INCREASE THE SHARE OF POLISH CAPITAL IN INVESTMENT” 5. Radosław Domagalski-Łabędzki, deputy Minister of Economic Development: POLAND AND IRAN COOPERATION WILL BE FRUITFUL 6. Ramin Mehmanparast, Ambassador of Islamic Republic of Iran in Poland: THE NEW ECONOMIC ARENA BETWEEN THE REPUBLIC OF POLAND AND THE ISLAMIC REPUBLIC OF IRAN

10. ISLAMIC REPUBLIC OF IRAN INFORMATION ON ECONOMIC RELATIONS WITH POLAND 18. Jerzy Jacek Szugajew, Vice President of the state development bank of Poland BGK (Bank Gospodarstwa Krajowego): OUR ROLE IS TO SUPPORT FINANCIALLY POLISH EXPORTS 19. URSUS S.A. IS POLAND’S MAJOR TRACTOR AND AGRICULTURAL MACHINERY MANUFACTURER 20. EXPERIENCE AND PROFESSIONALISM

7. Juliusz Gojło, Ambassador Extraordinary and Plenipotentiary of the Republic of Poland to the Islamic Republic of Iran: LIFTING OF THE INTERNATIONAL SANCTIONS CAN MARK A NEW ERA IN THE POLISH-IRANIAN RELATIONS. 8. Ministry of Economic Development ASSUMPTIONS OF THE “GO IRAN” PROGRAM FOR 2016

22. Damian Radziejewski, Production Director at Fama Bis; WE CAN SATISFY THE IRANIAN MARKET 24. Andrzej Arendarski, President and General Director of the Polish Chamber of Commerce (KIG): THE POLISH CHAMBER OF COMMERCE SUPPORTS BUSINESS

Photos on issue: www.shutterstock.com

SPECIAL EDITION

Publisher: Oficyna Wydawnicza RYNEK POLSKI Sp. z o.o.

(RYNEK POLSKI Publishers Co. Ltd.) President: Krystyna Woźniak-Trzosek Vice - Presidents: Błażej Grabowski, Grażyna Jaskuła Address: ul. Elektoralna 13, 00-137 Warszawa, Poland Phone (+48 22) 620 31 42, 652 95 77 Fax (+48 22) 620 31 37 E-mail: info@polishmarket.com.pl Editor-in-Chief: Krystyna Woźniak-Trzosek Deputy Editor-in-Chief: Ewelina Janczylik-Foryś redakcja@polishmarket.com.pl Marcin Haber m.haber@polishmarket.com.pl

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Writers/Editors: Maciej Proliński, Jan Sosna, Sylwia Wesołowska-Betkier, Janusz Korzeń, Jerzy Bojanowicz, Janusz Turakiewicz, Contributors: Agnieszka Turakiewicz Graphic design: Godai Studio Agnieszka Andrzejczak, Joanna Wiktoria Grabowska Sales: Phone (+48 22) 620 38 34, 654 95 77 Marketing Manager: Marianna Dąbkowska marianna.dabkowska@polishmarket.com.pl

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REGON 011915685, NIP 526-11-62-572 Published articles represent the authors’ personal views only.

The Editor and Publisher disclaim any responsibility or liability for their contents. Unso licited material will not be returned. The editors reserve the right to edit the material for length and content.

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“WE WANT TO INCREASE THE SHARE OF POLISH CAPITAL IN INVESTMENT” Radosław Domagalski-Łabędzki, deputy Minister of Economic Development

P

oland is entering a special time when simple mechanisms driving its economic growth are slowly becoming exhausted. Relatively low labour costs, or foreign capital, are no longer an optimal model for building our competitive advantages. We want to raise the efficiency and productivity of the Polish economy. We also want to increase the share of Polish capital in investment. The road to success, to avoiding the middle-income trap, is quite obvious to us. This is why we have to base our economic growth on innovation, research and development, and on enhancing the competitiveness of Polish businesses, especially exporters.

Work is now underway at the Ministry of Economic Development to introduce a new model of support for exports and enterprise. We believe that it will have a positive influence on the ability of Polish business to compete on foreign markets. The new solutions involve centralizing the support system. An agency for supporting exports, promotion and investment will be established. It will be a single institution managing from the central level most operational programmes dedicated to exporters. The agency will also take part in financing Polish exports. Today, responsibility for operational programmes is shared by several ministries and several agencies. We hope that a single central institution will enable us to save a significant amount of money on administrative costs and spend it on supporting exports. It will also enable us to pursue a coherent policy in the area of exports coordination. I personally take part in this work and am directly responsible for it.

I believe that the whole model has to operate in a single organizational chain. This is why the agency will be closely cooperating with executive bodies. I mean Polish missions abroad, like for example Trade and Investment Promotion Sections. We are holding consultations with other ministries, especially the Ministry of Foreign Affairs, on adopting an optimal model for the functioning of our foreign missions. We want to orient them at providing quality rather than quantity in services to Polish businesses. We also plan to strengthen the Trade and Investment Promotion Sections in terms of their expertise and staff. It is unfortunate that in recent time the Polish state has limited its institutional presence on many important foreign markets. We want to at least stop this trend, or reverse it, which would be the best thing. This is why we will be increasing our institutional presence on new markets through Trade and Investment Promotion Sections.

I am convinced that Polish entrepreneurs are faring excellently on European Union and Western European markets. And this

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is where an overwhelming majority of Polish exports go. But today we want to open opportunities for the development of Polish firms on other markets. It is obvious that the centre of gravity in both politics and economy is gradually shifting to the Far East.

Taking this fact into consideration, we want to make Polish exporters interested in expansion onto developing markets in Asia and Africa. In this connection, we are going to create operational programmes which will be supporting Polish entrepreneurs in their expansion on the Chinese market. We will also develop special enterprise hubs in China and one of the ASEAN countries.

Our sectoral promotional programmes contain strategies for supporting the 12 sectors that are indicated by them. We want the strategies to be coherent with our institutional presence on target markets. We will be strengthening the Go China and Go Africa programmes. We plan to introduce a new model to these programmes and add a few new programmes, like Go Iran and Go India. We regard these markets as very promising.

Cooperation with regional units in Poland will be a very important part of the new system of support for Polish businesses.

This is actually the basis for the proper functioning of the whole model because public administration does not have such local units of its own. We do not aspire to set up our regional agencies.

The organizations, foundations and associations which already operate locally will do that excellently. We want to base our cooperation on very close exchange of information and communication with regional units. Trade associations and organizations of entrepreneurs will also be playing an important role. Thanks to such close cooperation under a single, integrated and coherent model, entrepreneurs will have much easier access to public administration and support instruments, which they will be able to use more effectively. Today, one of the fundamental problems is insufficient knowledge about the support instruments. Some entrepreneurs are not aware of the existence of support programmes.

We will be changing this state of affairs through cooperation with regional units.

As part of the work conducted at the Ministry of Economic Development, we will be focusing on supporting Polish exports and enhancing the competitiveness of Polish firms. At present, their contribution to Polish exports is below 50%. This has to change.

Companies which increase their exports enhance their competitiveness. I strongly believe that by combining this with support for innovation we will be able to achieve our goals.

•

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POLAND AND IRAN

COOPERATION

WILL BE FRUITFUL

Radosław Domagalski-Łabędzki, deputy Minister of Economic Development

P

olish-Iranian economic and trade relations have a long tradition, going back almost one thousand years. We see Iran as a very attractive business partner, not only in the Middle East, but also globally. We are aware of the enormous development potential of Iran, and the fast rate of scientific progress in many areas. The foregoing is reflected in the Polish “Go Iran” Program aimed at intensifying mutual economic relations. The Program is also designed to encourage Polish companies to seek new trade and investment opportunities in the region.

Poland and Iran have a lot to offer to each other. I am convinced that our trade will soon increase significantly. I am glad that we are opening a new chapter in the Polish-Iranian contacts and hope that our economic co-operation will be fruitful. We remember how popular Polish products were in Iran in the early 20th century: furniture (including Polish chairs which remain popular even today), cut crystal or metal products. We hope that the lifting of the sanctions and barriers will allow trade to flourish in all segments of the economy. We see opportunities for further development of the co-operation between Polish and Iranian companies in such sectors as food and agriculture, means of transport, environmental technologies, construction, the machinery sector and medicine.

Moreover, Poland is interested in co-operating with Iran in the fuel sector. Iran is also rich in other minerals which may become the object of future contracts. Moreover, our companies actively participate in supplying mining machinery and

equipment. Importantly, the strategic location of Iran in the Middle East offers possibilities of opening railway connections with the Central Asian countries. Their construction would require considerable investment. Here too, we see significant opportunities for Polish enterprises.

We would also like to extend our bilateral investment relations. Poland is an open country and we invite others to develop projects here. We are an attractive and stable economic partner. We create good conditions for the development of entrepreneurship and as a result we see our exports grow and we attract foreign investments. Foreign companies which decide to locate their projects here appreciate us. Polish investors, too seek their opportunities in the Iranian market. Our economies are complementary and both parties can benefit from this fact.

One of the most effective business strategies is being permanently present in a given market. We showcase Polish goods and services in Iran by taking part in international fairs and exhibitions and by organising trade missions. Polish companies can always rely on government support. Our enterprises increasingly decide to operate outside of Europe and achieve considerable successes in their new markets.

I view my visit to Iran as a special honour. I hope that there will be many interesting and effective talks during the business mission, leading to concrete offers and contracts beneficial to both parties, thus contributing to a further development of our national economies.

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THE NEW ECONOMIC ARENA BETWEEN THE REPUBLIC OF POLAND AND THE ISLAMIC REPUBLIC OF IRAN Ramin Mehmanparast, Ambassador of Islamic Republic of Iran in Poland

L

ast year, 540th anniversary of Iran-Poland relations commemorated both in Tehran and Warsaw.

During these long lasting good and friendly relationships, there was no trace of any negative points instead between the First World War and the Second World War was a time of revival of bilateral relations. Polish businessmen and companies showed a deep interest in cooperating with their Iranian counterparts, especially in the oil, glassware, leather, food processing and furniture industries.

Thanks to Poland’s unique locations in Europe and Iran’s strategic location in the Middle East launching rail connections with Central Asian countries and together with launching direct flight would bolster up economic and tourism cooperation between Iran and Poland.

It is worth recalling that Iran’s fifteen neighbouring countries with over 300 million populations, is a considerable opportunity for both Polish and Iranian businessmen.

Iran’s and Poland’s economies complement each other. This means that they can cooperate on many levels. The first and foremost is the energy sector which Iran has the world’s second biggest natural gas deposits and the fourth-biggest crude oil deposits. This would be important for the diversification of energy supplies to Poland. Iran’s potentials for furthering and expanding economic cooperation are, among others, petrochemical products and industries as well as non- ferrous metals, agricultural products and Poland’s potentials for cooperation, among others, are mining, agricultural, industrial machineries, medical equipment and dry products.

Polish businesses could also find their niche in the consumer goods sector, including cosmetics, furniture, or in infrastructural sector. Rolling stock such as locomotives, railroad cars, electric high-speed trains and also spare parts are other fields of potential cooperation between Iranian and polish businessmen.

Iran is also open to joint venture projects in the area of machinery production or to general cooperation in the area of medicines and medical equipment production.

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“GO IRAN” PROGRAM During the official visit of the then Deputy Prime Minister and Minister of Economy of Poland to the Islamic Republic of Iran in last September, the Agreement on Comprehensive Economic Cooperation signed in Tehran. Accordingly, the joint Economic Commission will be held in Warsaw shortly with the participation of the Minister of Economy of Iran for implementing the provisions of the Agreement. This Commission would reshape and facilitate the economic cooperation between two countries.

Provincial cooperation is another important step toward deepening the economic and cultural relations between provinces of the Republic of Poland and the Islamic Republic of Iran.

The visit of large provincial Polish and Iranian delegations has already initiated. This year we expect more exchange of delegations between provinces of Poland and Iran.

As we mentioned launching the direct flight between capitals of two countries would have significant impact on the tourism industries in both countries and would facilitate more acquaintance of Polish and Iranian businessmen with the trade and economic capacities of each other.

Last but not least is that the joint Polish- Iranian Chamber of Commerce in Warsaw is a niche for consultation and close cooperation between private sectors of two countries. The Polish companies wishing to enter Iran and bolstering ties and guaranteeing their share in Iran’s vast markets and having access to the local and regional markets, can utilize its possibilities and register their companies in this active institute.

I would like to reiterate that Embassy of Iran in Warsaw will continue its activities to facilitate the direct contacts between right trade partners and to pave the way for the acquaintance of Polish companies interested in entering the Iran’s vast markets with the trade and economic potentials of the Islamic Republic of Iran.

Thank you

•

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LIFTING OF THE INTERNATIONAL SANCTIONS CAN MARK A NEW ERA IN

THE POLISHIRANIAN RELATIONS Juliusz Gojło, Ambassador Extraordinary and Plenipotentiary of the Republic of Poland to the Islamic Republic of Iran

A

s most of the EU member states, Poland perceives Iran as a potentially significant trade partner. As the initial agreement between and P5+1 countries on reducing Iranian nuclear program allowing cooperation with Iran in humanitarian trade was inked in late November 2013, Polish Embassy in Tehran undertook efforts to boost bilateral economic ties. The most visible part of our work has been a wide plethora of activities supporting organizing of trade missions which are a viable platform for initial contact between business people from both countries. In May 2015 Poland was one of the first EU member countries to decide on sending a business mission with a significant political backing. This trend has been visibly continued and every few months the Embassy, as the co-host, is involved in various visits, ranging from VIP governmental missions to small and medium sized enterprise delegation (who are the core of our success story and our economy), run by provincial and private trade organizations.

In the past, especially in 1980’s and in the beginning of 1990’s, a significant presence of Polish companies in Iran was obvious and visible. Just merely in mid-1980’s, there were approximately 4000 Polish engineers and workers working on many industrial projects: constructing power plants, sugar refineries and supplying services for agricultural aviation just to name a few.

In 1990’s, when Poland underwent transformation from central planned to free-market economy, some of Polish companies faced difficulties, which made them focus mainly on internal market, diminishing their export capacities. As a result, the

Polish-Iranian trade turnover was constantly dropping reaching finally a humble 46,4 million Euro in 2014 - a record alltime low. Another factor which led to current weak bilateral trade were to some extend the economic sanction that barred EU based companies from trading with Iran in many areas. We believe that our current turnover is definitely below capacity of the economies of two nations and very soon we will be able to change the negative trend.

On 16 January 2016, known as the ‘Implementation Day’, the UN and EU sanctions were lifted. As well as some of the toughest US sanctions, including penalizing international banks for doing business with Iran. It has given a new hope among Polish business society for re-establishing close ties with Iran, mainly in oil & gas sector, mining and industrial services. However we remain realists while being optimists: one must not forget about still existing obstacles awaiting Polish and in general EU based companies in trading with Iran. The major hurdle is still unresolved finally banking issue. Despite that Iran has been returned to the SWIFT system, EU based banks are still assessing how to restore fully financial services with and in Iran. Especially it refers to such issues as export credits and insurance. Another thing is very limited financial liquidity of Iran and Iranian companies – at least as far as the data is available. Having one of the biggest reservoirs of fossil fuels in the world, Iran will have to wait some time for rendered incomes from exporting crude oil and natural gas, as its obsolete petrochemical sector requires a lot of investment and the biggest international players are still very cautious about placing their financial assets in Iran.

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ASSUMPTIONS OF THE “GO IRAN” PROGRAM FOR 2016

Ministry of Economic Development International Cooperation Department

N

ot only is Iran seen by Poland as a very prospective market due to its large and absorptive domestic market and an attractive investment offer, but also as an alternative source of crude oil for the Polish refineries.

The main objective of the Program is to promote the potentially broad business opportunities of the Iranian market after the expected termination of the economic sanctions – amongst the Polish business and local government organizations. The Program envisages the following activities: • Launch of the www.goiran.gov.pl website (as modelled on the already existing www.gochina.gov.pl and www. goafrica.gov.pl online services).

• Design of the Program’s logo.

• Elaboration of publications on the Iranian market (for the Polish entrepreneurs) .

• Convention of the 1st session of the Polish-Iranian Joint Committee, co-chaired by Deputy Prime Minister, Minister of Economic Development, Mr Mateusz Morawiecki (first half of 2016).

• Organisation of the Poland-Iran business forum, an event accompanying the Joint Committee’s meeting, with the

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•

• •

• •

participation of representative business groups from both countries, together with a B2B session.

Support for the organisation of economic missions (both inbound and outbound) by the Polish Chamber of Commerce (KIG) and local business organizations, with the participation of the representatives of the Ministry of Economic Development (e.g. the mission from the Khorasan region, led by the Provincial Governor, in January 2016 as well as KIG’s mission to Iran (Tehran, Mashhad) in March 2016).

Organisation of information and promotion stands at 2 – 3 sectoral trade and exhibition events in Iran (in cooperation with the Polish Embassy in Tehran).

Economic consultations (second semester of 2016) with the selected Iranian ministers, i.e. of development, industry and foreign trade, finance, technology and innovativeness, mining and power, transport, among others.

Elaboration of promotional publications on Poland’s export offer ,in English and Farsi, for distribution at bilateral meetings and fairs.

Organisation of bilateral economic seminars/forums during the Iranian economic missions to Poland. •

www.suus.com

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ISLAMIC REPUBLIC OF IRAN

INFORMATION ON ECONOMIC RELATIONS WITH POLAND Basic information, economic situation Since 1979 – the Islamic Republic of Iran. Known as Persia until 1935. A theocratic system is in force in the country with ultimate political authority vested in a learned religious scholar referred to commonly as the Supreme Leader who, according to the constitution, is accountable only to the Assembly of Experts (currently Ali Hosseini Khamenei – Ayatollah since June 04, 1989). The President (Hassan Fereidun Rouhani) is elected every 4 years (last election – June 14, 2013).

Iran’s economy is strongly relying on oil and gas exports, but Iran also possesses significant agricultural, industrial, and service sectors. Private sector activity includes small-scale workshops, farming, some manufacturing, and services, in addition to medium-scale construction, cement production, mining, and metalworking.

Fiscal and monetary constraints, following the expansion of international sanctions in 2012 on Iran’s Central Bank and oil exports, significantly reduced Iran’s oil revenue, forced government spending cuts, and sparked a sharp currency depreciation. Iran’s economy contracted for the first time in two decades during both 2012 and 2013, but growth resumed in 2014. Iran continues to suffer from high unemployment and underemployment.

In June 2013, the election of President Hassan Rouhani generated widespread public expectations of economic improvement and greater international engagement. Reaching agreement regarding the

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nuclear programme followed the lifting of international sanctions has led to a veritable boom in the interest in the country among international business.

International organisations participation: US (United National Organisation), IMF (International Monetary Fund), IBRD (International Bank for Reconstruction and Development), WHO (World Health Organisation), OPEC (Organisation of the Petroleum Exporting Countries), WTO (observer).

Main urban centres - Tehran (capital, population 8.1 million, 12.1 million in the metropolitan area), Isfahan (3.4 million), Mashhad (3.0 million), Tabriz (1.6 million, Karadj (1.4 million), Shiraz (1.2 million).

Main natural resources of the country: crude oil, natural gas, coal, chromium, copper, iron ores, lead, manganese, zinc, sulphur.

Currency: Iranian Rial (IRR), average rate of exchange (2014 ) USD 1 = IRR25,780.2.

GDP: in the fiscal year 2014 the economy of Iran grew by 3% compared with 2013 when a decline by 1.9% was recorded.

GDP structure in 2014: services – 50.3%, industry – 40.7%, agriculture – 9.1%.

Main branches of the economy: petroleum, petrochemicals, gas, fertilizers, caustic soda, textiles, cement and other construction materials, food processing.

In its foreign trade Iran has for many years been showing a positive balance of trade (USD 16.9 billion in 2014).

Exports from Iran in 2014 were dominated by oil, chemical and petrochemical products, fruit and nuts, as well as metal ores and cement. The main trading partner of Iran is China, with a 26.8% share in exports, followed by: Turkey (11%), India (10.6%), Japan (7.3%) and South Korea (5.9%).

Imports to Iran were dominated by: supplies for the industry, means of production, durable consumer goods, food and technical services. The main partner was the United Arab Emirates accounting for 35.8% of the total imports, followed by: China (18.6%), India (6.4%), South Korea (5.8%) and Turkey (5.4%).

Economic policy The positive developments in the Iranian economy include successful attempts to change unfavourable system regulations. To balance the budget it has been decided to reduce subsidies by USD 20 billion.

The Iranian government has decided to discontinue the state budget fuel subsidy for private cars and trucks (which are mostly owned by Iranian entities subordinated to public administration). The move improved the efficiency of VAT collection. Its collection rate was significantly raised in the small business sector, where due to the lack of a control mechanism it was possible to easily avoid taxation in the past. A real revolution in the area of taxation may be extending the VAT to cover entities belonging to religious foundations (i.e. Bonyad) and held

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2012

2013

2014 *

GDP (in USD billions)

1,321

1,296

1,334

GDP per head (USD)

16,900

16,600

17,100

GDP (growth in %)

- 6.6 %

-1.9 %

3.0 %

Budged deficit (% of the GDP)

no data

no data

-0.7%

Public debt (% of the GDP)

no data

11.0%

11.4%

Inflation (%)

27.1 %

39.3 %

15.8 %

Unemployment (%)

15.5 %

10.4 %

11.2 %

Currency reserves (USD billions)

no data

108

110

Foreign debt (USD billions)

no data

10.63

10.17

Goods exports (in USD billions)

90.22

93.02

95.71

Goods imports (in USD billions)

67.0

60.05

61.25

Foreign direct investment in Iran (in USD billions)

n/a

40.36

43.50

Iran’s foreign direct investment (in USD billions)

n/a

3.725

4.045

General information

*/ estimated figures

Basic macroeconomic indices

Indices

source: CIA Word Factbook

Area:

1,648,000 km2

Population:

approximately 78.4 million (2014)

Head of State (president):

Hassan Fereydoun Rouhani (also serves as the head of government)

Minister of Industry, Mining and Trade

Mohammad Reza Nematzadeh

Minister of Economy and Finance

Ali Tayebnia

Minister of Energy

Hamid Chitchian

Minister for Oil

Bijan Namdar-Zanganeh

Minister of Foreign Affairs

Mohammad Javad Zarif-Khonsari

Ambassador of Iran to Poland

Ramin Mehmanparast

Ambassador of Poland to Iran

Juliusz J. Gojło

Last parliamentary elections

February 26, 2016

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by the Iranian Army and the Islamic Revolutionary Guard Corps.

After the agreement reached on July 14, 2015, the chances of Iran entering a more sustainable path of economic growth have increased significantly. They open up opportunities for foreign investments and capital, for increasing exports and restoring the proper place of Iran in the international markets.

Iran with its population of 80 million and the GDP approaching EUR 400 billion is already flirting with European businesses, which are eager to take advantage of the privileges offered to those who come to the market first. Iran is no longer interested in a one way import of goods and machinery. It seeks bilateral trade and co-operation in development, designing, engineering and joint investment projects for the benefit of manufacturing and exports.

Prior to the lifting of the sanctions, the GDP growth was estimated at 1.6-2%. Currently, it is thought that it may reach 3-4%. The manufacturing sector leads to economic revival in Iran, recording a growth of 6.7% last year, with the mining sector posting an even better result – an increase of 9.8%.

In mining alone, investments of up to USD 20 billion are planned by the year 2025. They include the building and development of mines. It is expected that most of the funds will come from foreign investors. The first pilot installation for producing coke from heavy fractions left over from crude oil processing has been commissioned in Iran. The authorities in Tehran plan production of 200,000 tonnes of coke per year. Investments in coke production are connected with the growing demand for this type of fuel.

Iran plans to carry out 21 railway projects totalling approximately 10,040 km. Development of railway links with the country’s regions is a priority. Some of the projects are already being implemented. Firms from China dominate in this area.

There are plans to triple the production of passenger cars to 3 million in 2025. Apart from European car makers also General Motors has shown interest.

Europe is seeking alternative sources to reduce its dependence on gas from Russia. Iran can become such a market. The country needs investments to develop its gas fields. Over the next 5 years investments in the oil and gas sector will reach approximately USD 185 billion. Tehran is also to offer energy companies better contract conditions.

The lifting of the sanctions also includes unfreezing Iranian deposits and money from oil sales.

It is estimated that the amount involved is between USD 100 and 150 billion. Experts from Iran’s Central Bank are trying to dampen expectations of a huge influx of hard currency. They estimate that some USD 29 billion will be transferred to the country. This money will be spent mostly in the petrochemical sector, mining and construction

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(including roads) to create new jobs. Iran denies spending it on the arms sector.

Legal and treaty framework for economic co-operation: EU – Iran On July 14, 2015 in Vienna a nuclear agreement on the control of the Iranian programme of develop-

Trade with Poland The year 2015 brought a significant upsurge in trade relations between Poland and Iran, although in absolute terms the amounts are still very moderate.

In 2015 amounted to EUR 45.1 million (an increase by nearly 30% – by EUR 10 million), with imports reaching EUR 29.3 million – an increase also by 30% (by EUR 7 million).

2011

2012

2013

2014

2015

Change 2015 2014

Exports (in USD millions)

65.9

41.6

35.8

35.0

45.1

+ 29.0 %

Imports (in USD millions)

100.9

23.0

22.2

22.4

29.3

+ 30.5 %

Turnover (in USD millions)

166.8

64.6

58.0

57.4

74.4

+ 29.6 %

Balance (in USD millions)

-34.9

18.6

13.5

12.5

15.8

Source: GUS (Central Statistical Office of Poland)

ment of nuclear weapons was signed between Iran and six powers (including Great Britain, France and Germany – members of the EU). This agreement allows for temporary suspension or abolition of economic sanctions imposed on Iran.

The main items in Polish exports in 2015 included: • Semi-conductors (11.6%), • Equipment for processing fruits, nuts and vegetables (8.1%), • Sugar syrups (5.1%), • Electrical instrumentation (3.7%), • Paper working equipment (3.2%), • Grinders (2.9%).

• Machines for forming rubber products (2.7%), • Road tractors (2.5%).

Poland - Iran • Mutual Support and Protection of Investments Agreement (so called Bilateral Investment Treaty – BIT) between the Government of the Republic of Poland and the Government of the Islamic Republic of Iran signed in Tehran on October 2, 1998 (Journal of Laws of 2002, No 22, item 217); • Avoidance of Double Taxation Agreement between the Government of the Republic of Poland and the Government of the Islamic Republic of Iran done at Tehran on October 2, 1998 (Journal of Laws of 2006, No 244, item 1770, as amended).

• Economic Co-operation Agreement between the Government of the Republic of Poland and the Government of the Islamic Republic of Iran signed in Tehran on September 26, 2015. It was ratified by the Polish government on December 28, 2015 – we await an appropriate communiqué from the Iranian side. The agreement provides for setting up a Joint Committee serving as a forum for future regular economic consultations. First session of Joint Committee should be held in the first half of 2016.

Main import items: • • • • • •

pistachio nuts (36.6%), pluck (17.7%), dried grapes (11%), coffee extracts/essences (6.5%), aluminium sheets (5%), dates, black tea, nuts,

Investment and capital co-operation In view of the political situation and the resulting numerous restrictions imposed on the participation of foreign firms in investment and development projects, Polish businesses limited themselves to maintaining their existing contacts. They also carried out acquisition activity aimed at expanding their operations as soon as the conditions change.

Efforts were made mostly in the mining sector, including oil and gas. Talks regarding a number

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FIRST POLISH TRAIN F U L LY C O M P L I A N T W I T H T S I – – S T R I C T E U R O P E A N U N I O N S TA N D A R D S .

The fastest rail vehicle designed and manufactured in Poland.

of small- and medium-scale projects are quite advanced. Apart from plans for direct capital involvement in the implementation of these projects, work continues in the area of research and development co-operation, including collaboration with higher schools educating personnel for the petrochemical industry.

There is potential for co-operation in other areas based on the existing and planned bilateral agreements, including: • Agreement on Co-operation in the Field of Environmental Protection (signed in 2002 by the Polish Minister of Environment with the Environmental Protection Agency during his visit to Tehran) – provides formal and legal basis for co-operation in many areas, including waste management, water management or pollution reduction.

• Air Transport Agreement (signed in Warsaw on October 26, 1999) – the scenario currently considered provides for starting regular direct flights between Warsaw and Tehran in June 2016.

• Work on a sea transport agreement is advanced.

• There are co-operation initiatives between universities and scientific-research institutions.

Access to the market Natural and legal persons intending to pursue direct business activity in Iran must register at the Ministry of Trade and the Iranian Chamber of Commerce. Registration results in the issue of a commercial proof of identity which must be presented at the signing of all trade contracts. Registration at the Ministry of Economy and Finance of Iran is required for customs and tax purposes.

The Iranian Import/Export Act distinguishes between three categories of imported products: goods which may be imported without • any permits; • goods requiring an import license; • goods which cannot be imported under Sharia law and other legal regulations.

In real terms, the export of goods to Iran is possible over two paths: • services of registered Iranian intermediaries – agency contracts must be registered at the Ministry of Trade, Department of Commerce.

• registration of the firm’s branch in Iran.

It should be remembered that other export paths are prohibited and result in penalties, e.g. confiscation of the goods (Detailed information on market access in English - Market Access Database – European Commission).

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SITUATION IN RELATIONS WITH IRAN AFTER 16 JANUARY 2016 After the so-called Adoption Day of the Joint Comprehensive Plan of Action (JCPOA) was declared on October 18,2015, the corresponding Implementation Day has been reached on January 16,2016, meaning that the International Atomic Energy Agency (IAEA) has verified that Iran has implemented its nuclear-related commitments, and that the corresponding economic and financial sanctions will be lifted.

As of the Implementation Day the ban on financial transfers to Iran has been lifted. Previously set requirements regarding a permit or registration of funds transfers no longer apply. All banking operations, including establishment of new correspondence banking relations (SWIFT) and opening of branches, representation offices of banks, are permitted. Offering financial support to trade in Iran, such as export credits, guarantees and insurance, is allowed. The same goes for obligations pertaining to subsidies, financial aid and preferential loans. The above provisions do not include Iranian natural or legal persons who remain subject to restrictions until October 18,2023 (Transition Day).

The import, swap and transport of crude oil, petroleum products, gas and petrochemical products is allowed. The export of equipment, technology and provision of technical support to the petroleum, gas and petrochemical industry in Iran is permitted. This also applies to all types of investments in given sectors.

Sanctions relating to shipping and the shipbuilding industry and transport, including provision of services connected with these areas, are lifted.

The right of Iranian institutions to trade in precious metals, including gold and diamonds, and to use their agency, financing and depositing services, is restored. Authorised trade in other metals, such as graphite, aluminium, steel, nickel and titanium is allowed. Sales of software, except for specific products for the nuclear or military sector, subject to the obligation to obtain a license of competent national authorities, are allowed.

The following remain in force: the embargo on arms, sanctions connected with rocket technologies, transfer restrictions regarding nuclear technologies and the supply of certain metals and types of software subject to a system of permits. The arms embargo covers all goods included in the common military list of the EU. Restrictions remain in respect of a certain category of natural and legal persons included in special UN and EU lists. Their assets remain frozen, they are subject to visa bans and bans on the use of specialist services, including SWIFT. These restrictions remain in force until the year 2023.

Sanctions imposed on Iran on account of human rights breaches remain in force. They include

the freezing of assets and a visa ban applying to 84 persons and one legal entity, and the ban on exports to Iran of equipment which could be used for internal repression and devices for monitoring telecommunications.

Actions for the development of bilateral economic cooperation Notwithstanding the sanctions in force and the resulting trade difficulties, the Ministry of Economy provides support to numerous initiatives aimed at developing bilateral economic co-operation. There have been many visits of representatives of the departments of economy of both parties, including: • November 2008 – meeting between Prime Minister Waldemar Pawlak and the Minister of Industry and Mining of the Islamic Republic of Iran, Mr Ali Akbar Mehrabian, • May 2009 – visit to Iran by Mr Marcin Korolec, Under-Secretary of State at the MoE, together with a business delegation (Świerk, Kopex and Zakłady Remontowe Energetyki), • October 2010 – visit to Poland by Mr M. Ghanei, Iranian deputy health minister, invited by M. Korolec, • February 2013 – visit to Iran by Mr Andrzej Dycha, Under-Secretary of State at the MoE together with an accompanying business delegation, • May 2013 – visit to Poland by Mr Mohammad Nahavandian, president of the Iranian Chamber of Commerce, Industry, Mining and Agriculture invited by the Polish Chamber of Commerce, • October 2013 – visit to Iran by Mr Bogusław Winid, Under-Secretary of State at the Ministry of Foreign Affairs, • November 2013 – trade mission of the Polish Chamber of Commerce, partner of the Iranian Chamber of Commerce, Industry, Mining and Agriculture, open-formula mission, sectors: agriculture, industrial tools, medical equipment, veterinary vaccines, structural elements, power generators, • February/March 2014 – visit to Iran by Mr Radosław Sikorski, Minister of Foreign Affairs, • May 2014 – sector trade mission of the PGNiG – energy sector, visit during the 19th International Oil & Gas Exhibition in Tehran, • May 2014 – visit of the Polskie Górnictwo Naftowe i Gazownictwo Capital Group (PGNiG, Exallo Drilling, Geofizyka Toruń), to determine the possibilities of returning to negotiations regarding

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•

•

•

•

a contract for the exploitation of gas deposits on the Island of Lavan, May 2014 – trade mission of the Office of the Marshal of Wielkopolska Province, open formula mission, sectors: food, office equipment, white goods, cosmetics, October 30-31, 2014 – visit in Poland (on the invitation of Deputy Premier Janusz Piechociński) by Iran’s Minister of Industry, Mining and Trade, Mohammad Reza Nematzadeh.

May 4-5, 2015 – visit of K. Kacperczyk, Deputy Foreign Minister, aimed at strengthening the political dialogue and economic co-operation, together with a group of some 70 entrepreneurs.

September 25-27, 2015 – visit of Deputy Premier and Minister of Economy Janusz Piechociński with a group of more than 100 entrepreneurs representing various branches of the economy. An agreement on economic co-operation was signed.

The GO Iran Programme The Programme was inaugurated in mid-2015. Its main goals were presented at a press conference of Deputy Premier Janusz Piechociński held on July 23, 2015. This is a series of activities designed to promote bilateral economic relations. It includes the following promotional activities (mostly carried out): 1. August 31, 2015 – organisation, with co-operation of the KIG – of a conference for Polish entrepreneurs regarding co-operation with Iran, attended by local and central government institutions, administration (MoFA, MoF, MoARD, etc.), the Embassy of Iran in Warsaw, bank and insurance institutions and Polish companies interested in the market (potential participants in a mission to Tehran). Preparation of information and promotional materials about the Iranian market.

2. Organisation of an economic mission of Deputy Premier, Minister of Economy, Janusz Piechociński to Iran on September 25-27, 2015 (on the invitation of the Minister of Industry, Mining and Trade who visited Poland on Oct 30-31, 2014) with participation of Polish entrepreneurs interested in co-operating with Iran. The programme of the mission prepared together with the KIG included, among others: • bilateral business forums in Tehran on September 26, 2015, • economic consultations at the departments of economy and finance; energy; mining, industry and trade; transport and construction, health and medical education, as well as oil, • Polish information stand at the Water and Waste Water Exhibition in Tehran (WATEX 2015),

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• visit at the Pardis technology park (near Tehran) and the largest investment fund in Iran – Social Security Investment (SSI), • signing an economic co-operation agreement providing for, among others, the establishment of an intergovernmental joint committee constituting a forum for future, regular economic consultations.

3. Preparation, in co-operation with the Polish Chamber of Commerce, of materials containing, among others, information about Poland’s exports, distributed during the forums in Tehran.

4. Support of the Ministry of Economy in organising a panel discussion devoted to Iran during the Economic Forum in Krynica, September 2015.

5. Honorary patronage of Deputy Premier, Minister of Economy, Janusz Piechociński, of the Asia Trade Exhibition held on November 20-21, 2015 in Ostróda.

6. Support of the Ministry of Economy Development in organising Poland’s national stand during the 23rd Iran Agro International Fair (May 2016) which is the largest exhibition of this type in Iran.

The programme is going to bo continued through 2016. The visit of the Undersecretary of State in the Ministry of Economic Development Mr. Radosław Domagalski heading the Polish businessmen mission to Meshhed and Tehran in March 2016 is opening the next part of our activities.

It is expected that the strong support for the development of bilateral economic relations will be given by the Polish Iranian Joint Committee to be held in 2016.

Potential areas of co-operation Trade between Poland and Iran remains below the level corresponding to the economic potential of both countries. This is due both to the unfavourable climate connected with the sanctions and difficulties regarding money transfers. A significant decline in the trade compared with the preceding year was due to the tightening of the sanctions by the USA and the European countries.

The food and agriculture sector has a particularly significant potential for increasing the volume of trade. Iran is a major food importer. This sector is unlikely to suffer from sanctions while evoking particular interest among Iranian entrepreneurs.

Goods export in this category has increased threefold compared with 2011. Poland continues to hold talks aimed at ensuring treaty-based support for its food and agricultural exports.

Apart from exports of food, there is also a market for machines and technology for agricultural production and processing.

The mining sector, including the fuel sector, is yet another area of future co-operation. It will require significant investments, as signalled by the Iranian government. Co-operation here may

include the supply of mining plant and machinery and participation in new projects and modernisation of the existing facilities.

The mining of minerals (including coal, chromium, copper, bauxite, iron ore, lead, zinc) can also become the subject of interesting Polish-Iranian trade and investment projects in the future.

Iran has deposits of minerals estimated at 57 billion tonnes (64 minerals), with the annual mining output of less than 0.5%. The Iranian mining sector is under-invested and mines work with outdated and often dilapidated equipment.

Road and rail infrastructure – major investment projects are planned in this sector. Iran’s strategic location in the Middle East offers possibilities of opening railway connections with Central Asian states. Iran will be interested in plant and machinery, equipment (engines, trucks, elements of rail infrastructure and car spare parts) and in participation in the construction of complete facilities.

Modernisation of the heat and power sector – supply of plant and machinery and transfer of technology to Iran – and the construction sector (including transfer of building technologies resistant to earthquakes, while offering increased energy savings).

Other sectors offering potential co-operation opportunities include: • cosmetic and pharmaceutical industry, • energy efficiency technologies, • construction chemicals, • furniture and fit-out sector, • medical equipment and instrumentation (including medical rescue equipment), • building and decorative materials, • clothes, • audio-visual equipment and household appliances.

Polish economic and trade missions in Iran no Department of Trade and Investments Promotion.

Embassy of the Republic of Poland in Iran address: No. 2 Pirouz St, Africa Expressway (Nelson Mandela Ave) 19-174 Tehran, Iran Phone.

+98 21 8878 7262

Fax:

+98 21 8878 8774

E-mail:

teheran.amb.sekretariat@msz.gov.pl

Website:

www.teheran.msz.gov.pl

Embassy of the Islamic Republic of Iran in Poland address:

Królowej Aldony 22, 03-928 Warszawa

Phone:

22-6171585

Fax:

22 6178452

E-mail:

secretary@iranemb.pl

Website: www.iranemb.pl

The Service – Production – Commercial Enterprise NIWA J.J. Niwa General Partnership is a specialist engineering enterprise which realizes the design and project management tasks for food, chemical, oil, petrochemical and power industries as well as in the field of environmental protection sector.

Our core business activity concentrates primarily on the design, prefabrication, delivery and assembly of technological devices and tanks from stainless steel or carbon steel. The design is developed according to 13445 norm and pressure directive PED 97/23/EC. All vessels are tailored to individual requirements of our clients.

NIWA offers: - pressure vessels : reactors, pipe heat exchangers, distillation columns, extractors, flashboxes, separators and other technological devices, - non-pressurized tanks, - storage tanks, The company second core business activity are industrial installations. In that scope we offer our customers prefabrication of stainless or carbon steel pipelines regardless of diameters or wall thicknesses and assembly in plants. Prefabrication of steel structures, platforms, supports etc. Additionally, we support our clients in maintenance of production lines, modernization of plants or revamps during shutdowns. NIWA is also experienced in relocation and expansion of production lines.

Technical potential and equipment, experienced and trained staff as well as good work organization enable us to carry out the most demanding tasks maintaining quality standards and competitive prices.

PN-EN ISO 9001, PN-EN ISO 14001, PN-N 1090-2, PN-N 18001/OHSAS, PN-EN ISO 3834-2

www.niwa.pl

OUR ROLE IS TO SUPPORT FINANCIALLY POLISH EXPORTS Jacek Szugajew, Vice President of the state development bank of Poland BGK (Bank Gospodarstwa Krajowego) What is the role of Bank Gospodarstwa Krajowego (BGK) in the trade mission to Iran?

The purpose of BGK’s participation in the mission to Iran is to add a financial component to what will be offered by Polish exporters. In a globalised and competitive world the seller is often increasingly burdened with arranging sources of financing for the buyer. BGK is the only Polish bank which is entirely stateowned and which provides services of this type, both under the Government Programme of Financial Support for Exporters and as part of its own activity. On the one hand, our participation in the mission will allow presenting the bank’s services to the Iranian partners, and on the other hand, will enable us to better understand the conditions and customs prevailing in that market.

Several exporters taking part in the mission have already invited BGK to meetings organised with potential Iranian partners. They understand that entering that market without the Bank’s support will be much more difficult. Of course, whenever possible, the representatives of the Bank will try to participate in all such events.

We also hope that through the Ministry of Economic Development and our diplomatic services we will be able to organise meetings with key local financial institutions,like for example the Organisation for Investment and Economic and Technical Assistance of Iran.

PM

Can the Iranian market be an interesting investment proposition from the point of view of exporters and financial institutions?

Yes, most certainly! Following the lifting of sanctions, Iran has become one of the most interesting markets in the entire world.

After years of sanctions and economic autarky it now shows a huge appetite for consumer and investment goods. Undoubtedly, it will PM

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be a very attractive market for Polish exporters, in particular, in sectors such as food, furniture, petrochemical or manufacturing of machinery and means of transport.

However, the matter looks slightly differently from the point of view of financial institutions. The probability of a Polish bank opening its branch in that country or buying a local bank is practically nonexistent. At the same time, if Polish exporters are to succeed in that market, it will be necessary to provide sources of financing the co-operation between Poland and Iran through direct investment credit and trade finance instruments. In this area Iran will be a hugely attractive market for Polish banks.

Is the presence of BGK in the mission a sign of increased commitment of the Bank to the development of Polish exports? How do you see your role in this and in the next missions?

Supporting exports became one of the pillars of BGK’s activity two years ago, following the adoption of a new strategy.

Its first effects could be seen in 2015 when the value of the Bank’s support increased nearly six-fold year-to-year. Therefore, our participation in this mission is yet another step in the strategy.

We follow the experience of other leading development banks in the European Union. Making due allowance, in the long term we would like to achieve a similar scale of operations.

As I have already said, our role is to support financially Polish exports, assuming most of the payment risk, either on behalf of a local bank or the importer. Moreover, we offer exporters a whole range of attractive financial instruments necessary for the performance of foreign contracts, including export prefinancing credits or various guarantees in international trade.

We plan to participate in this and future missions with these • services PM

URSUS S.A.

IS POLAND’S MAJOR TRACTOR AND AGRICULTURAL MACHINERY MANUFACTURER

I

t is a brand with a 120 year old tradition in the Polish farming industry. The company has on offer a long range of vehicles and machines produced for Polish and global markets. URSUS’s products meet the demands and needs of every farming generation. URSUS connects traditional Polish motorisation with world quality and high technology. It is Poland’s oldest globally recognised brand. Last year the company sold over 1,400 tractors, which marks the fastest growth in the market. URSUS participates in the Poland Go Global programme that promotes Polish manufacturers abroad. Over the past years, through the programme Go Africa, URSUS signed three contracts in Ethiopia and Tanzania, becoming a major partner of agricultural mechanisation in Africa. URSUS is a company with Polish capital and is listed on the Warsaw Stock Exchange.

URSUS has three manufacturing plants in Poland. One is located in Dobre Miasto, near Olsztyn, another in Opalenica, near Poznań, and the largest of the three is based in Lublin. Together the three plants produce nearly fifty end products every year.

Over 800 people work in these factories. The product range is very wide with over 20 types of tractors, 16 tractor trailers and 8 types of spreaders. URSUS is one of the best known brands in Poland. From the 1.5m tractors you will see on Polish fields, almost half of them were produced by URSUS. During the past two years the company has introduced new models of tractors, with engines ranging from 50bhp to 180bhp. They are destined not only for agricultural works, but also for construction, forestry and municipal industries. URSUS plans to continue developing its range of products. Sales indicate that URSUS has a huge potential, and clients have taken a liking to its products. The company has an advantage in the fact that it produces simple machines that are easy to operate. They are not packed with electronics, like other companies tend to do. URSUS only uses electronics for its engine and drive systems. You will spend much less than EUR 500 on service fees for URSUS engines after 2,500 hours of use. Other well known brands will usually charge you a minimum of EUR 500 for the servicing of their machines. The same goes for spare parts.

URSUS uses its 120 year old brand and the potential of Polish engineers and constructors to create a modern automotive hub in Lublin. The centre will benefit from the rich history of Polish motorisation, which goes back eighty years, to pre World War II times. The company’s strategy is to develop both the manufacturing and the science research facilities. In the past years URSUS has created a high tech Research and Development Lab. It’s task is to introduce more innovations into the products, and increase their competitiveness on global markets. URSUS R&D cooperates with engineers from the Lublin University of Technology, and the Military University of Technology in Warsaw. One of the first projects developed by URSUS R&D was the EKOVOLT city bus. The R&D lab is currently working on its own powertrain. The working title for this project is VIGUS. URSUS is planning to sell this powertrain as a separate product to foreign manufacturers.

URSUS is developing thanks to the Polish market and the export market, which as recent results show has a growing potential. These include the EU and African markets. The company sells its products to a few dozen countries, including the Czech Republic, Slovakia, Hungary, Belgium, Holland, Slovenia, Croatia.

It is also active Scandinavian and Eastern markets.

•

EXPERIENCE AND PROFESSIONALISM

PGNiG Capital Group Oil and Gas Exploration and Production Services Polish Oil and Gas Company (PGNiG SA) is Poland’s no 1 integrated group in the oil and gas sector. We have unique experience in exploring energy sources. We are a successor of the rich heritage of the Polish energy industry. The PGNiG Capital Group comprises commercial law companies of production, trading and services profile. The production and exploration services are provided by the fallowing companies: • • • • • •

PGNiG SA - The Exploration and Production Division Geofizyka Toruń SA Geofizyka Kraków SA Exalo Drilling SA PGNiG Technologie SA – Naftomet Production Branch Gazoprojekt SA

Geofizyka Toruń (GT), one of the leading geophysical solutions providers, is committed to helping oil and gas companies solve their toughest challenges, throughout the Exploration Lifecycle. Our experienced team of geophysicists, geologists and engineers – some of the most innovative professionals in the industry – strive to push the limits of geoscience every day. GT ’s goal is to help its customers gain a clearer picture and understanding of the earth’s subsurface so that they can locate and produce hydrocarbons, safely and efficiently.

Advanced Worldwide Geophysical Solutions Geofizyka Toruń (GT) delivers innovative geophysical solutions for safe and effective exploration. Its 50‑year international experience, implementation of the latest technology as well as quality and safety focused services make the competitive advantage of GT. The scope of its core integrated services covers: • • • • •

Seismic Data Acquisition, Seismic Data Processing, Seismic Data Interpretation, Logging & Perforating, Well Log Analysis.

GT is an international geophysical contractor operating in Europe, Asia, Africa, the Middle East and Central & South America. Our portfolio covers services performed for PGNiG, Shell, ExxonMobil, Chevron, ConocoPhillips, ENI, Total, Wintershall and Oil India.

GT is also one of the leading geophysical solutions providers.

It has successfully completed complex 3D seismic campaigns in

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the Islamic Republic of Iran for ICOFC, PEDEC and Sofregas, covering South Gashu, Rag‑e‑Safid and Sarajeh fields.

Geofizyka Kraków SA (GK) offers proven know‑how based on a wide experience in the regions we operate. Our seismic crews have gained their expertise in diverse, even the toughest environment conditions.

We have successfully performed field operations starting from highly urbanised areas of Europe, through mountains of Pakistan, Libyan and Oman high dunes, up to protected natural sites and wildlife sanctuaries. Our field experience is reflected in the geological knowledge of our professionals. They process and analyse data acquired in Europe, the Middle East and North Africa.

Everywhere we work, our staff is particularly aware of the principle that good relations with local communities are essential while performing seismic surveys. Working around the world GK always shows respect and understanding for local culture, religions and customs. Sharing our knowledge and experience is an important GK policy in establishing good relations with neighbouring communities. Operating reliably and efficiently in even the most adverse conditions is the way we do seismic surveys.

Exalo Drilling SA is a leading provider of drilling and oilfield services in Central and Eastern Europe. We have established a foothold in selected markets across Europe, Asia and Africa, including major hydrocarbon production markets, such as Kazakhstan, Pakistan, as well as the Czech Republic,

Georgia, India, Libya, Egypt, Ethiopia and Uganda, Lithuania, the Ukraine.

We maintain a fleet comprising more than 40 drilling and workover rigs of varying power, used to drill wells and perform all kinds of downhole work, as well as a wide range of tools and equipment to perform oilfield services. The Company works for recognised oil & gas upstream investors, both in Poland and abroad.

The priority of the Exploration and Production Division is exploration, providing documentation and ensuring the maximization of profitable output of hydrocarbons by PGNiG SA in compliance with the law and with respect for the natural environment. The Exploration and Production Division conducts exploratory activity within the framework of exploration and recognition of hydrocarbon deposits concessions obtained by PGNiG SA.

PGNiG Technologie SA is a market leader in construction services for the oil and gas industry and manufacturing oil and gas production equipment in Poland. The company designs, constructs and offers maintenance services of complete infrastructure for oilfield and gasfield, compressor stations, pipelines and underground gas storage facilities.

The scope of GAZOPROJEKT’s services includes development studies and analyses as well as complex engineering services for fuel and power industry, including gas industry structures related to natural gas production, transmission, distribution, storage, measurement and processing.

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WE CAN SATISFY THE IRANIAN MARKET

Damian Radziejewski, Production Director at Fama Bis, talks to Ewelina Janczylik-Foryś.

FAMA BIS was established in 1996, initially as a trading company.

Yes, the company has been in existence since 1996. Initially, as a trading company, we sold footwear articles such as undersoles, soles or heels. It was a family business created from scratch by my parents, Jerzy and Jolanta Radziejewski.

PM

When did it become necessary to extend the offer and widen the assortment?

In 2004, my parents decided to buy a modern production line.

Responding to market demand, we expanded our operations by adding manufacturing of tuni leather soles (vulcanized rubber sheets for soles – ed.), undersoles and masonite heels. Having invested in modern machinery, we are now highly competitive in the Polish and international market.

PM

What made you do this?

The economic situation was very good from the point of view of the footwear sector. The market continued to grow at a fast rate.

A decision was taken to extend the company’s offer. Thanks to our contacts in Italy, we imported state-of-the-art, innovative machines.

In 2008, we purchased a modern casting line from ZnAl, thus extending our offer by adding buckles, footwear ornaments and leatherwork fittings. We have been continuously improving our machinery and we deeply care about the development of the range and quality of our products. We have a huge number of models.

In 2013, we bought a new leather perforating/embossing press machine and a laminating machine.

PM

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You are talking of innovative machinery. I did not realise that one could talk of innovation with regard to the footwear market.

But of course you can. Until now milling machines have been used. Our new machine is going to cut with a wire. This modern technology has not been used in our market yet. The machine is very fast, cutting takes just 15 seconds or so. It does not wear out fast, there is no need to buy or sharpen cutters. The machine is digitally controlled by a computer. This is a prototype. The first machine for our company is already being built.

PM

Do you co-operate with specific machine-makers?

As I have already mentioned, my father has very good business contacts abroad. We import our machines mostly from Italy.

PM

Are people not pushed out of their jobs by machines?

No. After all, every machine must be overseen by a person. We receive lots or orders.

PM

Are your customers large Polish companies?

Yes, we work with many companies, well-known Polish shoe shops.

We need 2,000 pairs of a particular model in order to make a profit.

Consequently, large chains are our main customers, although we also deliver smaller on-line orders. We do not serve individual customers.

PM

Are these only shoe-making companies?

No, we have also established contacts with automotive industry.

For example, we perforate leather used to make car seats, steering wheel covers or headrests. We can serve customers in every sector PM

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that uses leather ornaments in its products, such as outer garments, i.e. jackets or coats, but also clothes and leather goods. Our next project is the manufacturing of interiors of shock-proof cases made of soft foam for a large Polish company.

What makes you stand out from the competition?

The thing that sets us apart from others is the emotional approach to running the company and real involvement in its management. We deal with customers honestly and try to adjust the product to their requirements. We make sure that we maintain good contacts with our business partners. Our strong points include accuracy, quality and extensive assortment of products. In addition, we are financially stable. We have a qualified team of employees and a modern design department. We trained all our employees from the beginning. We continue to work with the same employees.

PM

Why interest in the Iranian market?

After the loss of the Russian market three years ago, our sector in Poland registered significant losses. Many companies went bust. Retail chains with well-promoted brands exploited the situation and reduced margins to the minimum. This is not a good situation for subcontractors because their earnings are low while their employees keep working and their machines keep wearing out. The companies could not afford to develop. The sector has begun to decline. Polish companies have state-of-the-art equipment and are able to manufacture footwear of the highest quality. Alas, now we are swamped with products from Asia, namely China. Even well-known brands have their production plants there. Also, the conditions under which the Chinese workers operate, and the pay they receive, mean that the end product, i.e. a shoe, is not a happy shoe. And nobody is going to enjoy walking around in an unhappy shoe.

The mission to Iran is a major opportunity for the entire sector. We do not want to make cheap shoes, but shoes of very high quality. When I heard of the mission to Iran I completed the registration form without hesitation. Our countries respect each other. I am very happy that the sanctions have been lifted. Iran has a very rich culture. This is a very important period for Iran which can decide the future of the country.

It has a chance for dynamic development. It is important to ensure that the Iranian partners sign contracts with the right counterparties.

PM

Do you have contacts with foreign companies apart from Iran?

We used to have dealings with Ukraine and Russia. However, the situation has changed and this is reflected in trade contacts. But we also co-operate with companies in Bulgaria, the Czech Republic or Hungary.

I have established co-operation in Lithuania regarding leather goods.

I won’t deny that we have lots of ideas when it comes to the development of the business, its products and expansion in foreign markets. This mission to Iran, too will determine how successful we are in markets outside Poland. Of course, we have aspirations. We

I AM VERY HAPPY THAT THE SANCTIONS HAVE BEEN LIFTED. IRAN HAS A VERY RICH CULTURE. THIS IS A VERY IMPORTANT PERIOD FOR IRAN WHICH CAN DECIDE THE FUTURE OF THE COUNTRY.

PM

would like to be a good Polish company conquering the world. We dream of being a Polish champion.

Let’s present the products which you want to showcase during the trade mission?

Above all, I would like to present our company, manufacturing undersoles, soles and leather processing. However, my main interest lies in becoming an intermediary in the trade in high quality footwear, leather bags, belts and phone cases. I co-operate with numerous large companies which have huge technological and production capabilities. I would like to find an investor who would open stores in Iran selling an extensive range of Polish shoes, bags, belts that we offer. We already have companies co-operating with us in Poland, so delivering these products would pose no problem at all. I am able to start deliveries even today. I think that we can satisfy the Iranian • market.

PM

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THE POLISH CHAMBER OF COMMERCE SUPPORTS BUSINESS Andrzej Arendarski, President and General Director of the Polish Chamber of Commerce (KIG)

T

he Polish Chamber of Commerce is the largest independent business organization in Poland. It was established in 1990 and represents the largest number of enterprises, associating over 144 business organizations (including more than 50 regional chambers, over 60 industry chambers, about 40 bilateral chambers and industry associations). One of the main areas of the activity of the Polish Chamber of Commerce is international and pro-export activity.

The Polish Chamber of Commerce has for years cooperated with Iranian partners by organizing business missions abroad, economic forums in Poland and the participation of Polish companies in international fairs in Iran.

Our partner in Iran is the Iran Chamber of Commerce, Industries, Mines and Agriculture, with which we signed a cooperation agreement in 2000 and since then our relations have continuously developed. Each year Iranian delegations visit the Polish Chamber of Commerce and missions of Polish entrepreneurs, under the patronage of the Polish Chamber of Commerce, hold talks in Iran during events hosted by the Iranian chamber and its regional partners.

Thanks to our regular cooperation until now, business communities from our both countries have been effectively establishing closer contacts. The participation in such projects of an ever increasing number of enterprises is a clear signal that there is interest in consistent development of mutually beneficial economic cooperation.

In our promotional activities we cooperate closely with the Polish Embassy in Teheran, Iranian Embassy in Warsaw and PolishIranian Chamber of Commercial, which has just been registered.

We co-organize major events promoting Polish-Iranian cooperation, missions accompanying official visits of high-ranking

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representatives of the Ministry of Development, and seminars during visits of Iranian missions in Poland.

One of the major events organized by the Polish Chamber of Commerce was the Economic Forum in 2014 with the participation of the Minister of Industry, Mining and Commerce of Iran, Mohammad Reza Nematzadeh and his accompanying delegation of the largest Iranian enterprises.

In July 2015 the Ministry of Economy announced a new programme to promote economic cooperation called GO IRAN and the Polish Chamber of Commerce became a partner of the initiative. In August 2015, a conference for Polish enterprises on the opportunities of Polish-Iranian economic cooperation was held at the Polish Chamber of Commerce under the Go Iran programme.

Another event was the largest in history business mission of Polish enterprises to Iran in September 2015 with the participation of Deputy Prime Minister, Minister of Economy of Poland.

The Polish business mission visiting Iran in March 2016 on the occasion of the visit of the Deputy Minister of Development, Radosław Domagalski, is a continuation of events under the Go Iran programme, aimed at intensifying mutual economic relations.

Business people participating in this mission represent the principal sectors of Polish economy, that is energy and mining, environmental engineering, telecommunications, construction, transport and logistics, agro-food industry and many other.

There are interesting opportunities for cooperation between our countries in all these industries. We hope that Iranian and Polish companies will establish fruitful contacts, and the Polish Chamber of Commerce will continue to support this cooperation, remaining at the disposal of both Polish and Iranian partners.

Polish-Iranian diplomatic and economic relations have a very long tradition and Polish companies are perfectly prepared to contribute to their further development.

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