WBJ #35 2011

Poland promised to aid Libya and is hoping for new business there

WBJ ranks Poland’s five most controversial politicians. Guess who’s on top?

PGNiG and Tauron bought Vattenfall’s Polish assets for a total of z∏.7.6 billion 6

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VOLUME 17, NUMBER 35 • SEPTEMBER 5-11, 2011 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

REAL ESTATE

Weathering the storm COURTESY OF BOSE INTERNATIONAL

Lokale Immobilia

In 2009, Poland was a “green island” of growth in a sea of recession across Europe. In a special 8-page supplement, WBJ asks whether it can repeat that feat if the global economy turns south again

• Green developers • W.P. Carey interview • Poznaƒ railway station 22-27

A guide to Polish business and industry

Since 1994 . Poland’s only business weekly in English

Przewodnik po polskim biznesie i gospodarce

Special Economic Zones in Poland 28

News . . . . . . . . . . . . . . . . . . . . . . .2-5 Industry News . . . . . . . . . . . . . . . . .6 Listed Firms . . . . . . . . . . . . . . . . . . .7 Politics . . . . . . . . . . . . . . . . . . . . .8-9 Opinion & Analysis . . . . . . . . . . . .11 Finance & Economics . . . . . . . . . .12 Weathering the Storm . . . . . .13-20 Lokale Immobilia . . . . . . . . . . .22-27 The List . . . . . . . . . . . . . . . . . . . . . .28 Markets . . . . . . . . . . . . . . . . . . . . . .29 Arts & Culture . . . . . . . . . . . . . . . .30 Last Word . . . . . . . . . . . . . . . . . . . .31

¸UKASZ MAZUREK/WBJ/SHUTTERSTOCK

In this issue

Stuck in the middle

Built to last

Yulia Tymoshenko’s arrest is impeding efforts to bring Ukraine closer to the European Union during Poland’s EU presidency

Infrastructure Minister Cezary Grabarczyk has survived a third vote of no confidence, but Poland’s rail and road networks still leave much to be desired 5

4, 11

NEWS

www.wbj.pl

Blida death final report A final report into the death of Barbara Blida, a former construction minister, suggests that a third party may have been involved. Ms Blida reportedly committed suicide while the Internal Security Agency was searching her home in 2007 over allegations of misconduct. The report was presented by Ryszard Kalisz, a member of the Democratic Left Alliance (SLD) party. SLD now wants to bring Law and Justice leader Jaros∏aw Kaczyƒski before the State Tribunal.

Polish banks to break profit record? The Polish banking sector may reach record profits of z∏.15 billion by the end of this year, reported Rzeczpospolita. Already, in H1 2011, 33 of the country’s largest banks have reported z∏.7.7 billion in profits. That is an increase of 50% compared to H1 in 2010. Previous profit highs recorded were z∏.13.9 billion in 2008, and z∏.11.5 billion in 2010.

Smolensk body exhumed The body of Zbigniew Wassermann, one of the victims of the Smolensk disaster, was exhumed this week following revelations of inaccuracies in a Russian autopsy report. The request was made at the behest of his daughter, Ma∏gorzata, who cited the autopsy’s references to her father’s organs which had been removed years ago in a medical procedure. Mr Wassermann was a member of the Law and Justice party.

SEPTEMBER 5-11, 2011

IN THE SPOTLIGHT

Numbers in the News

Tenth anniversary of the 9/11 attacks

z∏.190,000 3.5%

was the growth in consumption reported in Poland for Q2 2011, lower than the expected level of 4%

z∏.20.9 billion was the government's budget deficit at the end of August. The figure fell by z∏.0.2 billion month-onmonth and is some z∏.15 billion less than assumed in the budget plan

Quote of the Week

The world will this week remember the victims of the 9/11 terrorist attacks in the United States which killed almost 3,000 people. Ten years ago, 19 al-Qaeda terrorists hijacked four passanger planes which they then crashed into the World Trade Center complex in New York, the Pentagon building in Virginia and a field in Pennsylvania. The main commemorative services will be held at Ground Zero, NYC, where the Twin Towers of the World Trade Center once stood. They will include the unveiling of part of the National 9/11 Memorial and Museum project and are expected to feature a record number of participants from the families of those who were

killed at the location in 2001. This year’s commemorative services in NYC have already courted a lot of controversy as the organizers have not invited those who survived the 9/11 attacks, nor representatives of the various American churches. The recommendation of the White House that emhpasis should be put during the memorial services on the universality of terrorism has also come under heavy attack. In Poland, which lost six of its citizens in the 9/11 attacks, the 10th anniversary of the event will be marked by, among other things, a special memorial concert at the Warsaw Philharmonic whose program will include Adagio for Strings by the renowned

American composer Samuel Barber, and September Symphony by the acclaimed Polish composer and musician Wojciech Kilar. The decennial will also likely be an occassion on which to discuss Poland’s security, as well as the political and economic ramifications that alQaeda’s attacks on the United States have had for the country. In the wake of the 9/11 attacks and the subsequent declaration by the US of a global war on terror, Poland committed some of its troops to both the Afghanistan and the Iraq campaigns. In Iraq, 22 Polish soldiers died; in Afghanistan, 29 Polish soldiers have lost their lives.

Vandals painted graffiti on a memorial to the hundreds of Jews who were burned alive by Poles in a pogrom in Jedwabne, Podlaskie voivodship, on June 10, 1941. The perpetrators painted a swastika and the lines “I don’t apologize for Jedwabne” and “they were too flammable” on the monument. ●

“There are no poor nations, only poorly-ruled ones” Jaros∏aw Kaczyƒski takes a thinly veiled swipe at the ruling coalition at a meeting with Solidarity trade union members.

Figures in focus Foreigners in Poland by purpose of visit in 2010 (in %) Shopping 1.9 3.1%2% 3.5% 4.8%

Transit Visiting relatives or friends Employment/business Tourism 78.9%

Casual work Education Other

Adam Zdrodowski Medical treatment

On WBJ.pl What Europe needs most Europe is facing difficult times, that’s not news. But how did we get here? What can be done? Log on to WBJ.pl for an inside view from Krynica Forum founder Zygmunt Berdychowski on obstacles facing Poland and the rest of Europe, and on what the EU can gain from getting closer to Ukraine and Turkey.

Source: Central Statistical Office

Company index 3Legs Resources ......................17 Globe Trade Centre....................23 Opel ..............................................6 Alterco ........................................26 Google ........................................18 Panattoni ..............................26, 27 Arcelor Mittal ............................18 GórnoÊlàski Zak∏ad

Pekao..........................................17

Bank Gospodarstwa Krajowego ..7 Elektroenergetyczny ....................6 Pentagram Architects................22 Bank Millennium........................16 gowebtrade.com ........................29 PGNiG ....................................6, 17 Bank Pekao ................................17 Haliburton ..................................17 Philip Morris ..............................18 Bank Zachdoni WBK..................17 HBI Polska Bisnode Group..........8 PKN Orlen ..................................27 Bank Zachodni WBK....................6 HSBC ..........................................12 PKO Bank Polski..........................7 BBI Development NFI................22 IBM ............................................18 PKO BP ......................................17 BGK ............................................17 IBM Software..............................18 PL.2012 ......................................16

DATELINE Monument to murdered Jews defaced

4.3% was the growth rate of the Polish economy in Q2 2011, slightly better than expected

is the amount it costs to support a child until its 20th birthday. That's 19% more than three years ago, according to the Adam Smith Centre

SHUTTERSTOCK

BZ WBK ......................................17 JEMS Architekci ........................23 Robyg..........................................24

7-9

17-18 WROCLOVE BEAUTY SALON

Event:

Find out the most pressing topics plaguing the European economies at this year's Economic Forum in Krynica-Zdroj. Location: Krynica-Zdrój. forum-ekonomiczne.pl

Event:

Experience the auction of 121 new works of art, each starting at z∏.500. Location: Desa Unicum, Warsaw. desa.pl

Bose International ....................22 ING..............................................17 Raiffeisen Bank Polska ............17 BRE Bank ..................................17 Invesco Real Estate ..................27 redNet Consulting ....................24

21st ECONOMIC FORUM

DESA – YOUNG ART AUCTION

BNP Paribas ..............................17 Infusion ......................................18 PricewaterhouseCoopers ..........20 BRE ............................................17 Intelenet ....................................18 Realm Energy International ......17

September

Bioton ..........................................6 iLoop Mobile ..............................18 Polish State Railways ................22

Take in a series of lectures on the latest trends and treatments in the cosmetics industry. Location: ul. Wystawowa 1, hall IASE, Wroc∏aw. salon-wroclaw.pl

CA Immo ....................................26 Jeronimo Martins Distribution ..15 Rotaria........................................27 Capgemini ..................................18 JSW ..............................................7 RR Donnelley Europe ................18 Chevron ......................................17 Kredyt Bank ..............................17 RWE Polska S.A. ........................15 Citi Handlowy ............................17 Kredyt Bank, Millennium ..........17 Sabre Holding ............................18 Citigroup ..............................12, 17 Kulczyk Investment....................23 San Leon Energy........................17 Cleantech Poland ......................13 Kulczyk Silverstein Properties ..23 Savills ........................................27 Colliers International ................26 Lane Energy ..............................17 Sberbank ....................................17 ConocoPhilips ............................17 Lufthansa ..................................18 Schlumberger ............................17

19-21 SECURITY RESEARCH CONFERENCE Event:

Join the debate on the issues facing the public safety and security fields today. Topics will focus on legal, technological and organizational aspects. Location: Hilton Hotel, Warsaw. src11.eu

8-9

SHOPPING CENTER FORUM & TRADE FAIR 2011

ASSET MANAGEMENT FORUM

Event:

Attend the most important meeting for the shopping center industry in Poland. Location: Hilton Hotel, Warsaw. shoppingcenter.pl

Event:

Follow the forum's top 10 recommendations, announced annually at the European Congress of Finance. Location: Warsaw Stock Exchange, Warsaw. gab.com.pl

Cushman & Wakefield ........24, 27 Luxoft..........................................18 Shell ..........................................18 Deutsche Bank AG ....................15 MAN Trucks ..............................18 Shell Polska ..............................18 Dom Development ....................24 Marathon Oil ..............................17 Silverstein Properties ................23 Echo Investment ........................23 Maximo Riera ............................31 Sjaelso........................................22 Electricite de France..................18 Millennium ................................17 Skanska Property Poland..........26 Electrolux ..................................18 Motorola ....................................18 Société Générale Polska ..........13 Elektrim......................................22 Motorola Polska Electronics ....18 Stem Innovation ........................31 Embud ........................................22 Nagel-Group ..............................26 Tauron ..........................................6 Empik Media& Fashion ..............8 NAP Invest Group ......................23 Tesco ..........................................18 Ericpol Telecom ........................18 Netia ..........................................10 TPSA ..........................................10 Ernst & Young ............................17 Neuca ........................................27 TriGranit ..............................18, 22 Euromonitor ................................8 Nidec ..........................................18 UniCredit ....................................17 ExxonMobil ................................17 Nokia ..........................................18 Vattenfall ......................................6 Fiat Auto Poland ..........................6 Nokia Corporation ....................15 W. P. Carey ................................27 General Motors Poland ..............6 Nordea Markets ........................12 Warsaw Stock Exchange ....6,7, 24

NEWS

www.wbj.pl

SEPTEMBER 5-11, 2011

Ukraine

Poland commits to aid for Libya after civil war

Komorowski: Tymoshenko affair harming Ukraine-EU relations

Warsaw will give Libya z∏.1 million in aid – and wants to take advantage of new business opportunities in the country

Ukrainian leader Viktor Yanukovych had just paid a oneday visit to Poland before the president made his remarks

the PM. He also announced that a sum of z∏.1 million had been earmarked for humanitarian aid. The task of rebuilding the war-torn country will also likely create a flurry of business opportunities, and Polish firms intend to participate, the government has said. Indeed, Poland’s z∏.1 million aid fund could be combined with government-backed loan guarantees to joint PolishLibyan enterprises, Mr Tusk Alice Trudelle said.

COURTESY OF KPRM

Poland is “fully committed” to “providing humanitarian aid to Libya, rebuilding its economy and to creating a better political system” there, Polish Prime Minister Donald Tusk said last Thursday at a summit of world leaders in Paris. The summit was meant to symbolize the end of Muammar Gaddafi’s rule, which began with a military coup on the same date 42 years ago. Poland’s prime minister said that although celebrating the end of the war may seem a little premature, as military operations are still continuing in Libya, “everyone is convinced that the fall of Gaddafi’s regime is close.” Nearly 70 nations, including Poland, have officially recognized the anti-Gaddafi National Transitional Council as the new authority in Libya. In Paris, NATO Secretary General Anders Fogh Rasmussen said he was deter-

mined to continue the alliance’s mission in Libya for as long as attacks and threats continued. Prime Minister Tusk, for his part, repeated that in his view, Poland’s decision not to become militarily involved in Libya was the right one. Polish aid will be “directly connected” with the country’s relatively recent experience in overcoming communism and its transition to democracy, a process in which Poland was “immensely successful,” said

In Paris PM Tusk pledged z∏.1 milion in aid to Libya

Polish President Bronis∏aw Komorowski has said that the arrest and ongoing trial of former Ukrainian Prime Minister Yulia Tymoshenko is harming Ukraine’s chances of developing closer ties with the European Union. “Ukraine has made serious efforts and has serious achievements in its quest for European integration but obstacles have appeared and the obstacle is definitely the trial of Yulia Tymoshenko, which in many European countries is seen as a political and not a criminal trial. This spoils Ukraine’s image,” said Mr Komorowski in an interview with TVP Info. The interview was conducted shortly after Ukrainian President Viktor Yanukovych completed his one-day visit to Poland last week. The Polish president said that as a “friend” of Ukraine’s, it was Poland’s duty

COURTESY OF THE EUROPEAN PARLIAMENT

Libya

Ukrainian President Viktor Yanukovych to frankly state that the negative publicity created by the Tymoshenko case needed to be “factored into the activities of the Ukrainian government.” The comments came just under one month before the Eastern Partnership conference, scheduled to take place in Warsaw on September 29 and 30. One of Poland’s biggest priorities for its term as holder of the rotating presidency of the EU is to help successfully conclude negotiations be-

tween the EU and Ukraine to create a free-trade zone. Poland had hoped to achieve this during the Eastern Partnership summit. However, the controversy surrounding Ms Tymoshenko’s arrest and imprisonment have put that plan in jeopardy. Ms Tymoshenko was taken into custody in August for “contempt of court” during her trial over abuse of office concerning a natural gas imports contract signed with Russia in January of 2009. Remi Adekoya

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NEWS

SEPTEMBER 5-11, 2011

www.wbj.pl

Infrastructure

Infrastructure minister to keep his job Polish Infrastructure Minister Cezary Grabarczyk will remain in his job after a majority of MPs voted against a motion of no confidence brought by Poland’s main opposition party, Law and Justice (PiS), which said the minister had been negligent in his duties. Along with PiS, the opposition Democratic Left Alliance (SLD) party voted in favor of the proposal, while the ruling coalition of Civic Platform (PO) and the Polish People’s Party (PSL) voted against it. A total of 227 MPs voted against, while 178 voted in favor. “We could have expected [the result], but it’s bad for Poland. Grabarczyk is an incompetent minister. A

EAST NEWS

Cezary Grabarczyk has survived his third vote of no confidence

Three motions of no confidence have been filed against Mr Grabarczyk since 2009 change in his position would have been good for Poland,” the head of PiS’s parliamentary club, Mariusz B∏aszczak, told reporters.

reason for presenting the motion, calling Mr Grabarczyk an “exceptional failure.” During the debate that preceded the vote, PiS MP

Earlier last month PiS party leader Jaros∏aw Kaczyƒski cited the poor state of the Polish road and railway infrastructure as PiS’s

Zbigniew Girzyƒski, referring to the high number of fatalities on Poland’s roads, said, “there is no other country where the side of the road looks like a cemetery.” Prime Minister Donald Tusk, meanwhile, defended his minister, saying that Mr Grabarczyk’s achievements were positive overall, before noting that Mr Kaczyƒski was not present for the debate. “We are present, you flee,” Mr Tusk said. This was the third time a motion of no confidence had been filed against Mr Grabarczyk. The first was brought by PiS in 2009, following an announcement that the number of road construction projects was to be reduced, and the second by SLD in January 2011, in the wake of a crisis on the country’s railways. Gareth Price

Election debates

PiS reluctant to take part in election debates Poland’s main opposition party said it would wait to judge the “quality” of the first debate COURTESY OF THE EUROPEAN COMMISION

Law and Justice (PiS), Poland’s main opposition party, is unsure if it will take part in a series of formal debates due to be held in the run-up to this October’s parliamentary elections. Representatives from a number of political parties met in parliament last Monday to discuss the topic of pre-election debates, with the first one held last Friday on television

opposition parties Democratic Left Alliance (SLD) and Poland Comes First (PJN). The debate, which focused on health and social policy, was the first of a planned six which will be held over a fiveweek period. Shortly after last Monday’s talks, Tomasz Por´ba, the man responsible for PiS’s election campaign, told reporters that his party still wants to take part in a debate, but at its own headquarters. Later in the week PiS party spokesperson Adam Hofman told the press that his party would in fact be making a deci-

sion based on “the quality of Friday’s debate.” “Will this be about a future coalition patting itself on the back, or a real debate about the future of Poland?” he asked rhetorically. SLD spokesperson Stanis∏aw Wziàtek told TVN24 that the debate venues “should be neutral,” but said the choice of location would ultimately be left up to the media. The upcoming debates will cover infrastructure and regional policy, the economy and public finances, foreign policy, and agricultural and rural affairs.

Business leaders back Civic Platform Entrepreneurs are more supportive of the ruling Civic Platform party than the opposition Law and Justice or the Democratic Left Alliance, according to a recent survey conducted by ZPP. The findings state that one out of every two business leaders would give their vote to the ruling Civic Platform party in the upcoming elections, and that the catastrophic picture of the Polish economy painted by the opposition did not appeal to business owners, the newspaper wrote.

‘B’ for Belka Polish central bank president Marek Belka was rated above both US Federal Reserve president Ben Bernanke and European Central Bank chief Jean-Claude Trichet in a ranking conducted by Global Finance magazine. On a letter-grade scale from A to F, Mr Belka received a B while the other two bankers received a C and a B-, respectively.

Gdaƒsk strikes remembered

Liberal, plugged-in and temporarily employed

On August 31 Poles commemorated 31 years since Lech Wa∏´sa signed the August Accords with Poland’s communist government. The event is widely seen as marking the onset of the Solidarity movement. The August Accords affirmed workers’ right to strike, ensured competitive wages and increased job security. “It was such a big victory, but the effects don’t match it,” Mr Wa∏´sa was quoted by TVN24 as saying.

A new report on Polish youth makes some surprising revelations

Financial markets want PO victory

Jaros∏aw Kaczyƒski’s PiS did not take part in the first debate station TVN24. The ruling Civic Platform (PO) party and junior coali-

tion partner, the Polish People’s Party (PSL), took part in the debate, along with the

The departure between the values, aspirations, and lifestyles of young people in Poland and the generations that preceded it is stark, a government report on the matter has found. Poland’s youth are increasingly liberal in their outlook and are technologically savvy. However, they also face some difficult challenges, particularly when it comes to employment. The report highlights that many young people entering the job market are hired only on temporary con-

tracts. As a result, they are forced to continue living with their parents, since without “permanent” work contracts, they aren’t considered creditworthy enough to receive a mortgage. Uncertainty about their future in the labor market is one of the biggest current anxieties for young people in Poland, the report finds, going as far as to say that the country risks creating a “lost generation” of 18- to 24-year-olds. The report also finds that Poland’s young people are consumption-oriented and increasingly liberal in their social values, especially when it comes to urban youths’ approach to relationships.

However, in the countryside a “radicalization of traditional values,” can be seen. The internet is the main source of information and the most popular communication tool for Polish youths. The vast majority (93 percent) of Poles between the age of 16-24 use the internet on a regular basis, spending between 17 and 20 hours a week online. The social group that has experienced the most change in post-communist Poland is young women. The report finds they are now better educated, more ambitious and more determined than ever to defend their position on the labor market. At the same time, young

SHUTTERSTOCK

Society

Young Poles find most of their information on the web women now face difficult choices, including the “freedom dilemma” (getting married or staying single) and the

“maternity dilemma” (whether to focus on their career or their family). Remi Adekoya

Financial markets would prefer a Civic Platform (PO) victory in the upcoming parliamentary elections this October, reported Dziennik Gazeta Prawna. This is because the party is expected to continue tightening fiscal policy, with the situation regarding the strength of the z∏oty and the profitability of Polish bonds dependent in part on reforms adopted after the autumn election. ●

INDUSTRY NEWS

www.wbj.pl

Eastern neighbors spend in Poland Poland’s eastern neighbors in Belarus, Russia and Ukraine spent a reported z∏.3.8 billion on various goods in Poland during 2010, reported Dziennik Gazeta Prawna. Ukrainian shoppers were the biggest spenders at z∏.2.3 billion, an increase of 15% from a year earlier. Belarusians spent z∏.1.4 billion, while Russian shoppers spent less than z∏.100 million. Construction materials, home appliances, autoparts, clothing and food products were some of the most popular items.

Bioton acquires veterinary firm WSE-listed Polish biotech firm Bioton has spent z∏.60 million to purchase Biolek, which sells veterinary products in China, Puls Biznesu reported. A contract for sales of these products in China is expected to yield $1.2 billion in revenues for Bioton over the next 10 years. The company, which is controlled by businessman Ryszard Krauze, expects more lucrative contracts, as well as much higher sales and profits, thanks to the acquisition of Biolek. ●

SEPTEMBER 5-11, 2011

Energy

Vattenfall assets at too high a price? Two of Poland’s energy giants may have overpaid for the Swedish firm’s Polish subsidiaries Swedish energy company Vattenfall AB has agreed to sell its Polish assets for a total of z∏.7.6 billion to two state-controlled Polish energy firms. Natural gas monopolist PGNiG will buy Vattenfall’s heat and power company, Vattenfall Heat Poland (VHP), based in Warsaw, for z∏.2.96 billion. Power utility Tauron, meanwhile, will acquire Vattenfall’s power distribution company, GórnoÊlàski Zak∏ad Elektroenergetyczny (GZE), in southwestern Poland, for z∏.4.6 billion. Although the management boards of both PGNiG and Tauron came out with upbeat statements when the news was announced, analysts and markets did not appear so enthusiastic. Both transactions were above market prices, according to a number of experts WBJ spoke to.

A promise kept According to Pawe∏ Burzyƒski, analyst at Bank Zachodni WBK’s brokerage house, PGNiG’s decision to buy VHP was based on a promise it made to its majority share-

holder – the State Treasury – that it would enter the heating sector. “Since entities left for sale [in the heating sector] are few and far between, they were desperate to fulfill this promise and ended up overpaying for VHP,” said Mr Burzyƒski. He added that while the Treasury may be happy with PGNiG’s purchase, minority shareholders could be worried, especially in light of the firm’s plans to acquire more companies. This could have a negative impact on PGNiG’s future dividend payouts, he said. “PGNiG will probably want to acquire [utilities] Energa or Enea which ... will cost much more than VHP,” Mr Burzyƒski added.

‘Stunningly high’ Pawe∏ Puchalski, another analyst at DM BZ WBK, meanwhile, said that Tauron has overpaid for GZE and that benefits the company might be able to gain from the transaction appear limited. Mr Puchalski said his firm expected Tauron to pay z∏.2.53 billion for GZE, adding that, “GZE’s assets fit Tauron perfectly, but the pricing is stunningly high. I see only a limited upside originating from the synergies.” Although the acquisition makes sense from a business

Legal News Contact: Miros∏aw Stefanik ms@pnplaw.pl

Provisions on company mergers and divisions to be liberalized Having examined amendments made by the Senate, the Sejm adopted the draft changes to the Commercial Companies Code proposed by the government, which aims to make the rules on merging and dividing companies easier. The new legislation means, among other things, that it will be possible to avoid the need to have a merger or division plan examined by an auditor, on the condition that all shareholders agree to this. The changes also allow those involved in mergers and divisions to avoid the obligation of having to inform officials about the changes in assets and liabilities which occurred between the date the merger/division plan was drawn up and the date a resolution to this effect is adopted.

Illegal immigrants become legal On August 26, President Bronis∏aw Komorowski signed the law on Legalising the Stay of Certain Foreigners in the Area of Poland. The law will become binding from January 1, 2012. The adopted provi-

sions will enable a greater number of foreigners who are currently staying in Poland illegally to legalize their stay.

A change to custom duty forms From September 12, 2011 new forms for custom duty purposes are being introduced. The intention of the Ministry of Finance is for the new forms to be less complicated than the current ones, thus making contact between entrepreneurs and custom duty authorities easier.

Entrepreneurs who fail to pay premiums won’t be penalized by both the Social Insurance Institution and the courts The Senate has drafted legislation which is to change the law on the social insurance system. Currently, an entrepreneur may be punished twice in the case of a failure to pay social insurance premiums: first by the Social Insurance Institution with a fee equal to 100 percent of the overdue amount, and second by the court. In accordance with the draft, a ban on double punishment is to be introduced. ●

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SHUTTERSTOCK

State firms PGNiG and Tauron paid a combined z∏.7.6 billion for Vattenfall’s assets point of view, as it should decrease Tauron’s operating risk in the short term, Tauron’s share price will still underperform the WIG20, Mr Puchalski said.

The share prices of both Tauron and PGNiG fell after the transactions were announced. As WBJ went to press, Tauron’s share price was z∏.5.25,

down 0.94 percent since the day the deal was announced. PGNiG’s stock price was at z∏.4, up 3.62 percent. Remi Adekoya

Gas monopoly PGNiG may go to court with Gazprom over prices In October, Polish gas monopolist PGNiG may seek arbitration over the price it pays Russian Gazprom for gas, PGNiG deputy CEO Radoslaw Dudziƒski was quoted by Reuters as saying last Thursday. Imports sourced from Gazprom account for around two-thirds of the 14 billion cubic metres of gas PGNiG sells annually. The recent hike in gas prices has had a negative effect on the group’s financial performance in the first six months of this year.

Despite increased gas sales, PGNiG posted a Q2 net loss of z∏.20 million. Analysts polled by Reuters had expected it to report a net profit of z∏.164 million. “The very high cost of gas in H1 2011, higher by almost z∏.900 million year-on-year, weighed most heavily on the group’s financial performance during the period,” Joanna Zakrzewska, a spokesperson for the firm, said in a statement. High prices of Russian gas imports are hitting PGNiG

particularly hard because the Polish monopoly’s prices are set by the Energy Regulatory Office (URE). But this might change as early as the end of next year. The URE may stop setting the prices of natural gas for industrial clients by the end of 2012, Dow Jones reported URE head Marek Woszczyk as saying. Poland has been ordered by the European Commission to deregulate its gas market as soon as possible. Alice Trudelle

Opel and Fiat’s Polish plants cut production predictions The Polish arm of German car manufacturer Opel will suspend production in its Gliwice plant for three consecutive Fridays in September due to a decline in orders, reported daily Rzeczpospolita. Przemys∏aw Byszewski, a spokesperson for Opel’s parent company, General Motors Poland, told the newspaper the production plant would not manufacture cars on September 2, 9 and 16. “We are verifying our plans

because of the collapse of the European market,” he said, before adding that the time will be used to prepare for the start of production on the Astra GTC IV model. The company has revised downward its prediction for the number of cars it expects to leave its factories. Instead of the 182,000 originally predicted for full-year 2011, the company now expects to produce 176,000. Production forecasts have

also been lowered by Fiat Auto Poland, which is now estimating 500,000 cars will be manufactured at its plant in Tychy, as apposed to previous estimates of 550,000 for this year. “We are adjusting our plans to the number of orders and the situation on foreign markets,” Bogus∏aw CieÊlar, a spokesperson for Fiat Auto Poland, told Rzeczpospolita. Gareth Price

LISTED FIRMS

SEPTEMBER 5-11, 2011

WSE

WSE’s H1 profit rises 30 percent Record-high trading levels accounted for the increase The Warsaw Stock Exchange saw its net profit grow by nearly one-third year-on-year in the first half of 2011 on the back of record-high trading levels. The bourse reported an annualized 31.4 percent rise in net profit, which came in at z∏.71.5 million. Sales revenues were up by 23.3 percent at z∏.137.5 million. The WSE Group said in a statement that the growth in profitability reflects recordhigh levels of equity trading, whose total value increased by 28.5 percent y/y to z∏.127.6 billion. Trading in Treasury bonds also hit an all-time high, with

cash-market transactions on the bond spot market rising by 144 percent y/y to z∏.142.2 billion. Trading revenue brought the bourse z∏.105.4 million, or 77 percent of its total revenue for the first six months of 2011. In all, there were 80 listings on the small-cap NewConnect index and 25 on the main market, another pair of recordhighs. The z∏.5.37 billion listing of coal miner JSW in early July was the stand-out transaction in the period. Interest among international investors was also strong, with 48 percent of all trading on the main market carried out by foreign investors. “In H1 2011, the Exchange took many initiatives, mainly

aimed at education of individual investors and promotion addressed to domestic and foreign institutional investors. Combined with the development of the product offer, including the addition of warrants and new single stock futures, this will increase the activity and the number of investors trading in derivatives,” WSE CEO Ludwik Sobolewski said in a statement. Lower costs than a year earlier, when the WSE incurred payments associated with its initial public offering, was another factor behind the positive figures. The exchange paid shareholders nearly z∏.135 million in July of this year, leading to a dividend yield of 7.6 percent. Gareth Price

Bouncing back Market capitalization (z∏. billions) and number of companies listed on WSE 500

600 Domestic market capitalization

*As of July

400

520

300

440

200

360

100

280

on this axis, Domestic market capitalization

on this axis, companies

Companies

200 2006

2007

2008

2009

2010

2011* Source: Warsaw Stock Exchange

PKO stake

Sale of PKO BP stake postponed The Ministry of Treasury and state-controlled Bank Gospodarstwa Krajowego (BGK) have suspended the sale of a 15.25 percent stake in Poland’s largest bank, PKO BP, because of recent turmoil on the markets. The project is set to be continued in late October or early November, the ministry announced on its website. “Due to high market volatility, the Ministry of Treasury and BGK, in consultation with a team of advisers involved in PKO BP’s second public offer, decided to temporarily suspend it,” the statement reads. The 15.25 percent stake comprises the full 10.25 percent belonging to BGK and 5 percent belonging to the Treasury, and has been valued at

COURTESY OF WIKIMEDIA COMMONS

The Treasury cited instability in the markets as its reason

PKO BP is Poland’s largest lender up to z∏.6.78 billion. The Treasury’s holding will be reduced to 35.99 percent if it manages to successfully offload the planned portion. The ministry also recently announced that it is still on

track to reach its goal of raising z∏.15 billion this year from privatization revenues. “The privatization processes are going as planned,” the statement read. Gareth Price

www.wbj.pl

INTERVIEW

www.wbj.pl

Growth predicted in restaurant sector

Parliamentary elections

Close to €7 billion is expected to be spent on eating out in Poland in 2011 as the country prepares to co-host the Euro 2012 soccer championship, reported Parkiet. That is a 4% increase from last year, according to research firm Euromonitor. Spending on restaurants will increase to €7.4 billion in 2012 and to €8.6 billion in 2015. Big chain restaurants in host cities and fast food outlets in train stations will benefit the most from the influx of tourists coming for the games.

Ma∏gorzata Kidawa-B∏oƒska, deputy chair of Civic Platform’s (PO) parliamentary club and the party’s spokesperson for the parliamentary election campaign, talks with WBJ about her party’s message to the electorate and the current situation in Polish politics

EM&F posts H1 loss Polish retailer Empik Media& Fashion (EM&F) reported a loss of z∏.10.2 million in H1 2011 compared to the z∏.13.5 million profit it made in H1 2010. Negative growth was the result of depreciation costs stemming from the opening of 93 new stores last year. Net sales increased by 7.1% yearon-year. The company plans to expand in Germany, Russia and Ukraine, and also wants to open new language schools abroad.

Service sector drives economy Poland’s service sector is driving the economy, with the automotive, gastronomic and hairdressing sectors faring particularly well, according to data from HBI Polska Bisnode Group for Dziennik Gazeta Prawna. From January to June, 3,543 car service stations, 3,491 hairdressers and 3,245 restaurants opened in Poland, while in H1 of 2011, a total of 151,000 companies registered for business. Not only are there more businesses from these market sectors, but also fewer are closing down. ●

SEPTEMBER 5-11, 2011

PO focuses on ‘modernization’ mesage

Ewa Boniecka: One of PO’s key slogans for the October parliamentary elections is “Poland under construction.” What is the message you are trying to send with this? Ma∏gorzata Kidawa-B∏oƒska: From the very start this campaign message particularly annoyed the opposition, because for many months we heard at numerous press conferences how during the last four years nothing has changed in Poland, that the country is in stagnation. And our message “Poland under construction” shows what has changed in various communities and regions, what investments were already made and have been realized. Some of them have been major, like motorways, others smaller, like new sports fields and kindergartens. These projects have been financed by the state, local budgets and through EU funds due to our excellent use of European Union money during the last four years.

conclusions that certain things should be realized in a different manner. We believe that Poland needs a continuation of our governance, because we can provide the country with a feeling of stability and security in all aspects: policy, the economy, foreign policy and also in the normal lives of the people. Some critics argue that your party lacks a distinct vision and that your pragmatism in governing has resulted in a failure to undertake fundamental reforms. How do you respond to this criticism? Our general vision is for the modernization of Poland, making our country a strong player within Europe and reducing our economic and societal distance from richer and older members of the EU. Ours is a vision for today and for the future. We want to achieve this goal by taking concrete steps to modernize Poland in all fields:

“I hope that the outcome of the election will help to stop this senseless war” So our party’s actions have opened a dialogue with Poles, we listen and talk with people about concrete steps undertaken for our country’s development. And by sending such a positive message to Poles, we can mobilize people’s energy and show Civic Platform’s determination to push forward the task of further modernization of our country. Besides the “Poland under construction” message, how do you envisage the development of PO’s campaign? We will run a campaign based on facts. Our general message will be realistic, and will avoid praising ourselves or aggression towards others. We will present what was fulfilled from our previous election program and from which elements we have resigned, after coming to

the economy, infrastructure, education, culture, social policy, the functioning of administration and by increasing citizens’ activity. We have begun many reforms and hope to continue them in the future, when, I personally believe, Poles will once again trust us. So I am responding to critics by pointing to some facts that show that our reforming strategy, performed step-bystep, is bringing results. It is often ignored that Poland avoided the European financial crisis not because of a miracle, but due to various measures undertaken by our government [with regards to stabilizing public finances] … Only this year we reduced the budget deficit by z∏.10 billion. We have also begun to reform the retirement system, by changing the structure of open pension

funds. We introduced better facilities for conducting business, and reforms to the justice system, where we introduced electronic devices and electronic access to courts. In the domain of social policy we did more for handicapped people than any other government previously. We are also maintaining economic growth. I want to add that in Poland we went through major reforms when it was necessary to change our political and economic system. Yet now I believe in an evolutionary method of conducting reforms, after many of the failed experiments of the last 20 years. What about ethical issues, such as the legalization of abortion and governmentfunded in vitro fertilization? Why has PO pushed these issues away from its agenda? We do not hide from such issues, after all it was PO which first began the debate about in vitro. I was co-author of the proposal to introduce the law allowing women who can not have children to receive in vitro fertilization and I am of the opinion that when the budget will allow this method of fertilization to be financed, we should pass such a law. It is true that in PO there are different attitudes towards this topic, and other ethical issues, just like in society as a whole, so there is also a need to find a compromise. Personally I am in favor of maintaining our present law on abortion, which was the result of a very difficult compromise. I think that if we have better sex education and better medical information about this issue, so-called underground abortions would be much less frequent. There is no doubt in my mind that ethical issues are important for many Poles, who having moved to and worked in other countries, are now conscious of different standards in this field and expect some changes in our country. Do you think that the Smolensk tragedy will be a feature of the election campaign and that it will be used as a political tool by opposition party Law and Justice (PiS)? I think unfortunately that it will be, as PiS’s election video,

COURTESY OF CIVIC PLATFORM

Ms Kidawa-B∏oƒska says differing views within PO on ethical questions is a strength, not a weakness which showed a picture of the late-president Lech Kaczyƒski and his wife pinned on a refrigerator’s door, demonstrated. And the publication of Interior Minister Jerzy Miller’s report into the tragedy will not solve it. The findings of that credible and fully objective report, which exposed the mess on both the Polish and Russian sides, is not accepted by those in Poland who hold onto conspiracy theories and want to blame people pointed to by PiS as being responsible for the catastrophe. So is the so-called “Polish-Polish” war set to continue? I would not describe it as Polish-Polish war. I think that this war-like atmosphere is created only by a very few people, who define their role in public life in that way. When I meet ordinary people, who have different views on the Smolensk catastrophe, yet are ready to talk and exchange arguments on this issue – it is not a warlike situation. Admittedly, there are others who hold the conviction that only their views and attitudes are right, and that causes an end to the possibility of any discussion. I hope that the outcome of the election will help to stop this senseless war, because more and more Poles have realized that it only brings harm to our country.

How do you view the president’s declaration that he will not engage himself in the election campaign? Some commentators have read this as a sign that a distance is growing between the president and PO, the party to which he previously belonged. The president cannot engage himself in the election campaign. Though this did occur on a couple of occasions in the past, President Komorowski is holding to the principle that he is the president of all Poles. His stand during the election campaign is a demonstration of his respect for the constitution. The Polish presidency of the EU Council will continue through the election-campaign period. Some of your adversaries claim that PO will use this fact to boost the image of Prime Minister Donald Tusk. Is this true? The presidency of the EU and the election campaign are not connected. By holding the presidency, our country is fulfilling the tasks set for it by the EU. The meetings of Prime Minister Tusk with other European leaders are a part of his duties. So accusations that the presidency will be used by PO for political advantage is completely false. It is Poland’s presidency of the EU, not PO’s, and we all should do everything to make sure it is successful. ●

POLITICS

SEPTEMBER 5-11, 2011

www.wbj.pl

Poland commemorates start of WWII

Politics

Poland’s five most controversial politicians With the recent passing of Andrzej Lepper, the former leader of the SelfDefense (Samoobrana) party, Poland has lost one of its most controversial politicians in recent memory. And while there will never be another Andrzej Lepper, there are still plenty of politicians who are talented at causing a stir. Here is WBJ’s list of the top-five most controversial politicians plying their trade in Poland today. 5. Janusz Palikot:

Mr Palikot has become a non-factor in Polish politics, but is still worth mentioning. Though he quit the ruling Civic Platform (PO) party to form his own (with little success), Mr Palikot was once among the most controversial and often quoted politicians in Poland. While in PO, he was often adored by those who disliked Law and Justice (PiS) and its leaders, as he mercilessly and relentlessly slung verbal jabs at the Kaczyƒski brothers, and especially the late President Lech Kaczyƒski. Mr Palikot accused President Kaczyƒski of being everything from an alcoholic to someone medically unfit to hold the office. He alluded, in a not-too-subtle manner, that his brother, Jaros∏aw Kaczyƒski, could be a homosexual (the PiS leader has never married and has no children). He also once appeared at a press conference brandishing a sex toy and a pistol, and at another time, a pig’s head. The term “Palikotization” was even used by some in the Polish media to describe a new phenomenon in Polish politics, namely its having become more crass, vulgar and increasingly dominated by media events, controversial statements and attention-grabbing antics.

4. Jacek Kurski:

Gifted with a sharp tongue and with the ability to get under his opponents’ skin, Mr Kurski is often referred to as Mr Kaczyƒski’s “bulldog,” for his energy and enthusiasm in going after political opponents. The PiS MEP is detested by many who consider him to be the embodiment of political cynicism, a label he appears to wear with pride. He will no doubt be remembered for his suggestion during the 2005 presidential campaign that current Prime Minister Donald Tusk’s grandfather served in the German Army during WWII. Even though it was later explained that Mr Tusk’s grandfather had been forcefully drafted into the Werchmacht and later deserted, the damage had already been done, and many believe it was one of the reasons Mr Tusk lost that election to Lech Kaczyƒski. Several journalists at the press conference where Mr Kurski made the accusations said he was asked off-camera if he really believed Mr Tusk’s grandfather had been on the side of the Germans during the war. And what was Mr Kurski’s reported reply? “No, but the dumb masses will buy it.” Of course, Mr Kurski later vehemently denied ever having said any of this.

2. Zbigniew Ziobro:

1. Jaros∏aw Kaczyƒski:

The deputy leader of PiS and the man expected to one day take over for Mr Kaczyƒski is an ambitious 41-year-old who was once minister of justice when PiS was in power (20052007). He is accused by many opponents of using heavyhanded and undemocratic methods to hunt down the “bad guys.” While in office, Mr Ziobro strove to be perceived as the Polish version of former New York Mayor Rudolph Giuliani, fearless in his battle with highprofile criminals. His most famous and illfated line came when he said at a press conference that “no one else will ever be killed by this person,” referring to a cardiologist who had just been arrested on charges of corruption and medical negligence following the death of a patient. Suffice it to say it is not exactly the justice minister’s role to pronounce a man a killer before a trial has even begun. Mr Ziobro also recently made headlines after he practically accused Prime Minister Donald Tusk of banning free speech in Poland. What made the statement even more dramatic was that it was made in the European Parliament during Poland’s inauguration of its presidency of the Council of the European Union on July 1 of this year. Mr Ziobro is a darling of the ultra-conservative Catholic audience of controversial radio station Radio Maryja. His popularity among a significant segment of society is evidenced by the fact that he won the second-highest number of votes in Poland (over 335,000) in the 2009 European parliamentary elections.

Mr Kaczyƒski is Poland’s current undisputed king of controversy. The leader of the country’s largest opposition party, PiS, he is undoubtedly the politician the largest number of people in Poland love to hate. Many journalists’ workdays begin with an analysis of Mr Kaczyƒski’s latest comments, as the PiS leader says things that other mainstream politicians simply wouldn’t dare utter. If he were a backbencher making similar comments, he would get little coverage. But when it comes from one of the most powerful politicians in the country, people listen. And Mr Kaczyƒski seems to delight in escalating emotions, by provoking outrage and making statements that get people talking. Here are some of his more memorable quotes: “Gazeta Wyborcza [the most popular broadsheet in Poland] is a mutation of the Communist Party of Poland.” “Poland is a Russian-German condominium.” “Moscow is in the possession of documents concerning the past of [former Polish] President Aleksander KwaÊniewski, and that means he cannot make decisions independently.” “I think to a large extent [current President Bronis∏aw Komorowski] was elected president by mistake.” Responding to journalists’ questions about whether he would meet with protesting nurses who had embarked on a hunger strike: “For the meantime they’ve missed one dinner. That has yet to harm anyone.”

3. Stefan Niesio∏owski:

A member of the ruling Civic Platform party and the current deputy speaker of parliament, Mr Niesio∏owski is a firebrand, despite being 67 years of age. Quick and ruthless with his tongue, Mr Niesio∏owski wastes no time in dishing out scathing judgements of his political opponents and has a particular dislike of Jaros∏aw Kaczyƒski. Here are some of his more memorable lines: “The Kaczyƒskis are the source of all evil. Especially Jaros∏aw Kaczyƒski.” “It’s not worth commenting on the words of losers.” “The similarities between [Jaros∏aw] Kaczyƒski and [former communist dictator W∏adys∏aw] Gomu∏ka are striking.” Referring to former president Aleksander KwaÊniewski and Ryszard Kalisz, his chief of staff, after Mr KwaÊniewski vetoed a bill that would have banned the sale of pornography in Poland: “Ryszard Kalisz is a porno minister who is an excellent fit for a porno president. We have an alliance of two porno fatties.” Referring to the European Court of Human Rights in Strasbourg, which ruled that France had discriminated against a lesbian who had been denied the right to adopt a child: “It is unimaginable that a homosexual could adopt a child. The tribunal can issue whatever kind of verdict it likes, but we will not adhere to it here in Poland.”

Remi Adekoya

President Bronis∏aw Komorowski and Prime Minister Donald Tusk both commemorated the 72nd anniversary of the beginning of the Second World War on September 1. Speaking on the Westerplatte peninsula in Gdaƒsk, the place where the first battle of the war was waged when Germany attacked Poland on September 1, 1939, Mr Tusk said, “We want the memory of our heroes to be the foundation of our country’s message: that Poland can never be powerless in the face of danger and threats.”

Raising children more expensive Supporting a child is becoming increasingly expensive, as the average cost to raise them from birth until their 20th birthday has reached z∏.190,000, reported Dziennik Gazeta Prawna. This is a z∏.30,000 increase on the average cost from three years ago, according to experts from the Adam Smith Centre. The main reason behind this rise is the increased cost of education supplies.

Poles less happy about Euro 2012 Around half of all Poles surveyed (48%) are happy about Poland co-hosting the Euro 2012 soccer tournament next year, but almost the same number are indifferent towards the flagship event, according to a new study by CBOS. Only 5% think Poland’s hosting of the tournament is a bad idea. But despite the positive outlook, the number who are happy about co-hosting the tournament has dropped considerably since 2007, when 67% had a positive attitude towards the event, reported Dziennik Gazeta Prawna. ●

SEPTEMBER 5-11, 2011

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Your Company in a Virtual World of Cloud Computing Dorota Patoka, Product Group Manager, Crowley Data Poland Sp. z o.o. For some time now, cloud computing has been quite popular in the market of telecommunication services dedicated to business customers. Are virtual services offered through an operator’s networks a mere marketing trick or can they serve as a cost-effective tool for developing businesses? The term “Cloud Computing” originates from a graphical representation of a cloud, initially symbolizing either the internet or network environment. More recently, the concept has enjoyed a wider recognition, though it has been around for some time now. Perhaps the most popular example of a cloud computing service internet users might be familiar with is access to e-mail accounts via world-wide-web portals, such as poczta.onet.pl; poczta.wp.pl or mail.google.com. By now, practically everybody has had an opportunity to use cloud services. The dynamic development of cloud services is connected with the expansion of internet access. Access to fixed, symmetrical, high-capacity internet lines with a guaranteed quality service (SLA) is becoming more common. Consequently, the internet is used not only as a communication medium, but also as an easily

available element of an advanced teletechnical network offering products that demand large-scale investments, long testing periods and a considerable degree of logistical involvement of the enterprises. Now, finally, an average company has an opportunity to use, at attractive prices, advanced tele-IT access solutions previously available exclusively to corporations. This way, smaller-size companies can support their business development by offering their customers the quality comparable to that previously restricted to the largest corporations only. The market offers solutions involving teleconference systems, such as virtual telephone exchanges (vPABX) or virtual call centers (vCC) designed to support simple telephone services and convert them into a tool for communication with customers, thus improving the company’s daily internal operations. Conference systems can serve as a perfect device for internal training sessions, product presentations and team meetings within an organization. Crowley Data Poland offers this solution as TeleKonferencja Crowley service with a multi-track voice connection allowing to display the presentation online. The service is equipped with a user-friendly www dash-

board designed to remind you about the call conference, automatically send invitations to the other participants, or record and store the call logs. Other operators, such as TPSA or Netia also provide similar services, but certain functionalities we offer, such as ordering and cancelling the call conference on your own, an easy cost analysis, or an intuitive customer panel available on a 24/7 basis via the website give us a strong competitive advantage. Virtual Telephone Exchanges (vPABX) are becoming more popular among landline telephone users employing internet lines. Actually, this has become a preferred alternative to quite rigid solutions offered by analogue copper cable telephone systems. In contrast, this solution facilitates a flexible management of resources, such as adding new users, modifying user settings, creating various levels of accessibility or integrating geographically dispersed telephones into one corporate network. What is more, this solution helps you lower expenditures on telecommunications because internal calls within the network are made freeof-charge. Additionally, you have access to billing details of whole groups or individual users. Finally, you can block outgo-

ing calls to any destination. Last but not least, you can manage the service remotely from any place in the world connected to the internet. Virtual call center systems give you an opportunity to handle telephone traffic without the necessity to build advanced voice systems; all you need is a high-quality internet line, personal computers with internet telephony software and a corresponding service provided by your telecommunications operator. Your system administrator defines the rules of incoming traffic distribution, options of rerouting unanswered calls to other agents and telephones or recording the calls via a www panel. Since this is a remote-access system, you can reach it from anywhere in the world connected to the internet. What is more, virtual call centers are a perfect solution for home offices as they give you an opportunity to lower costs of office-space rental. Finally, you can control the work efficiency of your agents by an online, ongoing reporting system. Hosting at the operator network is one common feature characteristic of all cloud computing services. Users have access to virtual services with no need of equipment, software or a license to perform a given activity – all you need is a PC connected to

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the internet and its resources. Thus, cloud computing operations facilitate the efficient management of the company’s finances. Access to services hosted by operators gives you independence from in-house solutions and helps distribute investment costs better; it also makes you independent from services of specialized staff. It therefore significantly lowers your operating costs unrelated to the company’s core business. Cloud computing solutions give access to flexibly managed resources. Without internal infrastructure you can use the resources as you wish according to your current needs, which generates a higher cost efficiency combined with an ability to dynamically respond to an ever-changing business environment. ● The author has been a member of the Crowley Data Poland Sp. z o.o. team since 2007. As an Internet Product Manager, Ms. Patoka was in charge of implementing the internet access offer based on TPSA infrastructure (BSA). Since 2008, as a Product Group Manager, she has been in charge of managing the company’s product base, launching new products on the market and pricing policy in distribution channels.

OPINION & ANALYSIS

SEPTEMBER 5-11, 2011

www.wbj.pl

Editorial

Viktor Yanukovych’s obstacle course

Backs to the wall Ms Tymoshenko was taken into cus-

Analysis

tody in August for contempt of court outright. Russian President Dimitri during her trial over abuse of office Medvedev then responded by saying regarding a gas import contract that Ukraine was “seeking non-stop signed with Russia in 2009, when she indulgence.” Importantly, however, he added was prime minister. The current Ukrainian authorities view the agree- that “If Ukraine doesn’t want [to join ment as highly disadvantageous and the customs union] … [then it] should Prime Minister Mykola Azarov has make a commercial proposal that is accused Ms Tymoshenko of “selling- advantageous to Russia.” It was clear he was referring to the sale of the out” Ukraine’s interests to Russia. It is important to remember that Naftogaz stake. Ms Tymoshenko had her back to the wall when she agreed to the deal. The contract was signed after Russia had earlier cut off winter gas supplies to Ukraine, meaning if Ms Tymoshenko had not come to an agreement with Moscow, many Ukrainians would have been in danger of freezing. The Ukrainian government is trying to re-negotiate the deal, but Moscow is making tough demands. The Kremlin initially said it was willing to lower the Yulia Tymoshenko in happier times price Ukraine pays, but only So the Russians will not insist on if Kiev gave up its European ambitions, joined a new Moscow-led cus- Ukraine joining a Kremlin-led customs union, and sold its 50 percent toms union, but would settle for constake in energy company, Naftogaz, to trol of Naftogaz. The Ukrainians later stated that they planned to list Russia’s Gazprom. The Ukrainians rejected this offer Naftogaz shares on the stock market, SHUTTERSTOCK

ollowing a visit by Ukrainian President Viktor Yanukovych to Poland last week, Polish President Bronis∏aw Komorowski said that the detention and ongoing trial of former Ukrainian Prime Minister Yulia Tymoshenko is an “obstacle” to the country’s chances of developing closer ties with the European Union (see story, p. 4). Mr Komorowski said the trial was seen in the West as political and that it “spoiled” Ukraine’s image. Poland is worried about the situation, since one of its biggest priorities in its capacity as president of the Council of the European Union is to help successfully conclude negotiations between the EU and Ukraine to create a freetrade zone between the two economies. It was hoped this would be achieved during the Eastern Partnership summit scheduled to take place in Warsaw on September 29-30, but now the controversy surrounding the trial has put that plan in jeopardy. Mr Komorowski is right that the Tymoshenko affair is harmful to Ukraine’s image, and Mr Yanukovych needs to fully grasp the importance of perception in the West if he is to bring Ukraine closer to it.

and expected $5-10 billion from the transaction, signaling that they were willing to negotiate. However, as WBJ was going to press, the drama saw another twist: the Ukrainian government announced that it would liquidate Naftogaz altogether and review all previous contracts. Gazprom responded by saying that this would be the logical move … if Naftogaz were merged with Gazprom. Whether that was Ukraine’s intention was, at the time, unclear.

“Orange Revolution,” that swept her to power in 2005, “Iron Yulia,” as she is called by her supporters, has a long history of being mixed up with some of the shadier characters of Ukraine’s business and political scene. Nevertheless, Ukraine will only gain the respect of EU policymakers if it eliminates the impression that the trial of Ms Tymoshenko is being used to punish her for her past or to squeeze her out of politics.

Not worth the cost Keeping its options open It is against this backdrop that the trial of former PM Tymoshenko is taking place. Russia is a prickly neighbor to deal with, as Ms Tymoshenko found out to her cost, and Ukraine would do well to nurture its ties with Brussels as a counterweight to Moscow. That is why Mr Yanukovych needs to ensure EU policy makers are not left with the impression that Ukraine is a country that does not share its values. This isn’t to say Ms Tymoshenko is a saint. Though many in the West see her as a hero of the pro-Western

If Mr Yanukovych wants to bring Ukraine closer to the EU, then he needs make sure the rule of law is observed to the letter in court cases, especially where those proceedings involve high-profile, opposition politicians. Countries which are genuinely interested in developing closer ties with Western nations but have lingering image problems must be doubly careful not to strengthen the negative stereotypes. If the EU turns its back on Kiev, then Ukraine will be left at the mercy of the Kremlin, as Belarus is now. Punishing Ms Tymoshenko at all costs or trying to eliminate her from politics is simply not worth the harm it could do to Ukraine. Mr Yanukovych must make sure he doesn’t back himself into a corner. ●

Banking without borders

t the height of the financial crisis in 2008 and 2009, it seemed as if Western banks would pull out their stakes in emerging markets and return home, leaving financial markets increasingly fragmented along national lines. But, as a new report by Deutsche Bank Research highlights, banks’ cross-border business – direct or via branches or subsidiaries – has now broadly stabilized. During the crisis the level of banking activity fell particularly strongly in capital-intensive areas such as traditional lending to the private sector. The effect was especially pronounced in lending to non-financial companies, whereas lending to households – an area with traditionally lower internationalization – remained more robust. In part, the decline was due to increased holdings of foreign public debt relative to private debt. Prior to the crisis, banks had often been net sellers of foreign government bonds, but they significantly increased their purchases during the 2008-2009 period. With the onset of the European sovereign-debt crisis in 2010, banks’

appetite for public debt fell again. In contrast to lending activities, banks’ commitment to foreign markets has remained virtually unaffected with respect to purely intermediary activities such as investment banking and asset management. Interbank relationships, as well as investmentbanking operations, are already highly international. The deep cross-border links between financial institutions and the activity of globally active investment banks only took a brief hit from the crisis. By contrast, the importance of foreign markets for asset managers remains very limited and has not changed significantly since 2007.

Emerging strength Despite the recent setback, Western banks’ presence in emerging markets today is much greater overall than it was a few years back. One reason for this is that revenue growth usually goes hand-in-hand with macroeconomic growth, which increasingly is found in emerging-market countries, rather than in many banks’ mature Western

home markets. Moreover, private and public-sector debt levels tend to be much lower in the emerging economies. At the same time, geographically diversified institutions outperformed even during the recent global crisis, because they were less vulnerable to downturns in individual regions. And, at least until a certain stage of growth, economies of scale and scope beckon, with expansion abroad often the only way to increase size, given already-saturated domestic markets. The pace of internationalization has been swift. As recently as 2001, Europe’s top 20 banks still generated more than half of their revenues at home. By 2010, this share had fallen by 10 percentage points, to 42 percent, a remarkable decline that was interrupted only briefly by the financial crisis.

Post-crisis banking Overall, the outlook for post-crisis international banking is positive, but regulation could change this. In the current environment, with a renewed focus on regulating markets, institu-

tions, and financial instruments, some international differences in scale, scope, and application of the new rules may be inevitable. But, without a broadly consistent approach, the authorities risk creating a legal patchwork that would make cross-border banking less efficient, more expensive, and more difficult to conduct. Apart from banks being discouraged from investing abroad, outright restrictions on foreign banks’ market access cannot be ruled out, either. The rapid growth in intra-European banking relations in the past decade was made possible to a large extent by the abolition of formal and informal barriers to foreign service providers. Though this environment may not be fundamentally at risk, the current trend towards increasing capital requirements for international banks – reflected, for example, in calls for the establishment of independent subsidiaries with autonomous capital and liquidity pools – is clearly worrying. Nevertheless, given the relatively favorable outlook for cross-border banking, Western banks’ presence in

Jan Schildbach

emerging markets could strengthen further, while banks domiciled in these regions might start looking beyond national borders. Traditional lending and deposit-taking still offers much growth potential and may become more attractive relative to investment

“Overall, the outlook for post-crisis international banking is positive” banking or asset management as a result of new regulation. In this case, banking will become more like other industries that have benefited themselves and their customers by evolving into truly global networks. ● Jan Schildbach is a banking analyst at Deutsche Bank Research. The report “Home, Sweet Home? International Banking after the Crisis” is available at www.dbresearch.com. Copyright: Project Syndicate, 2011.www.project-syndicate.org

Editorials are the opinions of WBJ’s editorial board. Other opinions are those of the authors alone. Comments, opinions and letters should be sent to editor@wbj.pl. Please include a name and contact information and clearly indicate if they are to be considered for publication.

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Economic growth

Manufacturing sector

Poland’s economy grows by 4.3% in Q2

PMI index shows slower growth

20 st gu

01 Au

y2 Jul

01 e2 Jun

11 Ma

20 ril Ap

20 rch

20 Ma

ry rua Feb

0 ua Jan

r2 cem

Source: Central Statistical Office

David Ingham, Gareth Price

vem

20 Q2

10 20

20 Q1

10 Q4

20 Q3

20 Q2

09 20

20 Q1

09 Q4

20 Q3

20 Q2

-2

-1.3

-1

0.8

1.5

0.9

0.3

1.3

tob

2.6

4.7

* Anything above 50 indicates improvement on the previous month

5.7

7 6

Ella Pa∏ka

Poland's PMI, August 2010-August 2011

pte

7.6

Employment, meanwhile, grew only marginally. Commenting on the overall situation in August, HSBC economist Dr Murat Ulgen said that the PMI reading painted a “rather mixed picture.” “On the one hand, weakness in export orders points to a continued deterioration in the foreign demand outlook. But the new orders index has been relatively healthy for the past two months, suggesting that stillrobust domestic demand is picking up some of the slack,” he explained in the report.

Slowing growth

Year-on-year growth of public-sector consumption (%)

Poland’s score for August was driven in large part by domestic demand, which offset weakened demand for Polish exports. “New export business declined for the third month running despite a weakening of the z∏oty,” the report read. Although 51.8 indicates a positive reading, a breakdown of the figure shows that output growth is easing. While output increased for the 25th consecutive month in August, the rate of growth was the second-weakest since October 2009.

The Purchasing Managers Index reading for the Polish manufacturing sector fell in August due to a dip in export orders, but still remained in positive territory. The PMI reading for last month came in at 51.8, compared to 52.9 in July. The PMI index indicates the level of expansion or contraction in the manufacturing sector. Scores below 50 indicate shrinkage, while anything above suggests expansion.

Smaller state

increase in inventories.” They noted that private consumption rose by only 3.5 percent, compared to 3.9 percent in Q1, and that public spending actually declined by 1.3 percent y/y. And despite the strong overall figure for Q2, economists have said growth rates are likely to be adversely affected in the second half of the year because of the recent troubles of major global economies. “Given the deterioration in the external environment in July and August we believe the pace of inventory build-up is not sustainable and we expect firms to limit output and start reducing inventories in the coming months,” Citigroup wrote. “The depreciation of the z∏oty vs the Swiss franc and the stock market sell-off will additionally weigh on consumer spending in H2 2011,” the bank wrote, adding that it expects growth to slow to 3.5 percent in Q3 and to 2.9 percent for the full-year 2012.”

Poland’s economy expanded by a higher-than-expected 4.3 percent in the second quarter as slowing consumer demand was offset by strong fixedinvestment growth. The market consensus had forecast gross domestic product growth of 4.2 percent. “The domestic economy remained the key growth driv-

er in Q2,” Anders Svendsen, chief analyst at Nordea Markets, wrote in a research note. Specifically, fixed-investment grew 7.8 percent y/y, compared to 6 percent in the first quarter. Nevertheless, some economists have said economic growth did not necessarily result from a broad range of strong fundamentals, with Citigroup analysts writing in a market report that “the positive surprise came almost entirely from a dynamic

But economists are worried about a slowdown in consumer demand

A drop in export orders is to blame

Source: Markit

How much will the Euro 2012 tournament boost Poland’s economy?

Poland’s banking sector remains stable 16

Investing in Ma∏opolskie, a sneak peak at Investing in Poland 2012

WEATHERING THE STORM W a r s a w B u s i n e s s J o u r n a l ’s s p e c i a l s u p p l e m e n t o n h o w P o l a n d w i l l n a v i g a t e t h e c u r re n t u n c e r t a i n t y

SEPTEMBER 5-11, 2011

Poland’s economy

Can Poland remain a green island? Remi Adekoya

Prime Minister Donald Tusk’s now-famous description of Poland as a “green island” at a press conference in 2009 was apt: Poland was the only country in the European Union to register positive growth in all four quarters of that year. Poland’s achievement made headlines worldwide and vastly improved the perception of the country among foreign investors and financial analysts. At the same time it got everybody asking how Poland managed to grow its economy when all others saw contractions. Since then, Poland’s economy has experienced steady expansion, growing by 3.8 percent last year. The first quarter of this year also saw healthy growth of 4.4 percent, with growth in the second quarter at only a marginally less robust figure of 4.3 percent. But with

COURTESY OF PREMIER.PL

As fears of a second global economic crisis grow, WBJ looks at the prospects for the Polish economy to weather the storm as well as it did in 2009

In 2009 (left) Poland was the only European country to show GDP growth. In Q2 2011 (right) its economy grew 4.3 percent the growing uncertainty surrounding world markets and the popular suspicion the global economy is heading for another crisis, can the Polish economy continue to grow, and if so, at what pace?

cent in June. Economists are already saying there is no chance of Poland registering the 4 percent GDP growth the government had previously predicted in its 2012 draft budget. “I was expecting GDP growth of roughly 4 percent next year, but now I would expect growth between 3 and 4 percent. So, if by a green island we mean a country with positive GDP growth, then yes, Poland will remain a green

A visible slowdown There is already some evidence of a slowdown in the Polish economy, as retail-sales growth eased for the third straight month in July, growing by 8.2 percent compared to 10.9 per-

island,” said Stanis∏aw Gomu∏ka, former deputy minister of finance and current chief economist at the Business Center Club. “But I expect a slowdown on both sides of the Atlantic due to the tightening of fiscal policy. We can also see that despite a monetary policy providing very low interest rates, commercial banks are very careful in extending credit because of the current uncertainty,” he added.

Jaros∏aw Janecki, chief economist at Société Générale Polska, also expects economic growth to decelerate. “I think this year’s GDP growth will be close to 4 percent and around 3.7 percent next year, although this is the optimistic scenario,” he said.

Home front A quarter of Poland’s exports go to Germany, meaning Polish exporters will be keeping a close eye on the health of the

German economy in the coming months. But key to Poland’s resilience during the 2008-2009 global recession and its relatively strong showing thereafter was the strength in domestic demand. But what exactly are the key domestic factors that will determine the scale and pace of Polish economic growth this year and next? “The most important will be consumption and private Continued on p. 16 ➡

Natural resources

Poland’s shale-gas gold rush

SHUTTERSTOCK

Investment in shale gas in Poland will ramp up in the coming years – but whether production will be commercially viable still remains to be seen

There could be as much as 5.3 trillion cubic meters of shale gas in Poland

International companies have been flooding to Poland in the hopes of striking some shale gas – a type of natural gas trapped in shale deposits deep underground. And it’s little wonder why. Poland’s shale gas reserves have been estimated at between 1.5 and 5.3 trillion cubic meters (tcm). That’s enough to fulfill

Poland’s domestic gas needs for over 300 years considering current consumption levels. So instead of importing much of its natural gas from places like Russia or Central Asia, Poland could actually become a net exporter. “The geological perspectives are excellent in Poland,” said Parker Snyder, executive

director at Cleantech Poland, a consultancy company that aims to play a role in decreasing Poland’s dependency on coal. “There are large continuous seams from around Gdaƒsk in the northwest to the Lublin area in the southeast, most of them of good quality. The key issue is making the exploration and excavation commercially viable,” he added. In Mr Snyder’s estimation, that could happen in five to 10 years.

Plenty of international firms, as well as Poland’s domestic oil and gas giants, intend to do just that. Continued on p. 17 ➡

In this supplement Poland's economy . . . . . . . . . . . .13, 16 Shale gas potential . . . . . . . . . . .13, 17 Interview with Zygmunt Berdychowski . . . . . . . . . . . . . . . . . .15 Euro 2012 economic boost . . . . . . .16 Banking sector stability . . . . . . . . . .17 Investing in Ma?opolskie . . . . . . . . .18 Interview with PwC's Mike Kubena . .20

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XXI Krynica Economic Forum

European dilemmas Ella Pa∏ka: Do you think Poland will be, as it was in 2009, a green island of growth in the European Union? Zygmunt Berdychowski: Of course this depends on how the European economic situation will evolve, but so far, the symptoms do not suggest the financial crisis will be as deep as the one in 2009. However, I can say that I am convinced Poland will no longer be a green island, as more European countries will be in much better macroeconomic shape than in 2009. This year’s Economic Forum is entitled “European Dilemma: Partnership or Rivalry?” Are you worried about the future of the EU? Every European should care that the EU is successful, and I am convinced that we have to do everything not only to save the EU, but also to modernize it, give it a new dynamic, a new stimulus and new significance. It is important that we believe in Europe as much as we did in the late 90’s, after the fall of the Iron Curtain. Then everyone believed that it was possible to create a different union, a union which would consist of both the “old” and the “new” countries. There is no room today for

individual interests whether Polish, German, French or Italian. We are in a global competition – against the US, China, India … and we must cooperate among ourselves. Krynica has historically been a meeting point for entrepreneurs, experts and the region’s most powerful politicians. How well do you think politicians are handling the current economic difficulties across Europe? Poorly. One does not have to be a keen observer to provide such an answer. First of all, European economies are not growing at a rate of 5 or 10 percent as we would like, but rather are crawling at rates of two, three, or four percent. That is far below expectations. Second, we have two completely different philosophies within the EU when it comes to public finances. On the one hand we have countries from the former Eastern bloc such as Poland, Slovakia, the Czech Republic, and Hungary, where one has to work hard, very hard, and work longer than others and be prudent with one’s finances. On the other hand, we have those who are responsible for the situation in

Greece, Spain, Portugal and to some extent in Italy, but there are also some other large Western European countries whose debt levels are beyond comprehension, compared to our standards. Poland has been wary of the possible development of a two-speed Europe, where developed economies would evolve separately from developing ones. And this raises an important question: What are the boundaries of responsibility of the strongest countries of the EU towards the union’s weakest members? The most important thing to note is that the countries developing on the periphery also benefit those in the center. Germany’s economy has been expanding quickly also because a large number of German corporations are conducting investments in Poland. They are completing public investment projects – financed in part by EU funds – in Poland, building highways, airports, industrial products, helping to create completely new infrastructure. These investments do not only benefit Poles, but also those who work on these roads, and those who lend money for these projects. In one word, this system is linked, and everyone benefits. How can Europe continue to be a global leader without resigning from active support

The Economic Forum in Krynica-Zdrój Organizer: Institute of Eastern Studies Founder and chairman: Zygmunt Berdychowski First held: 1992 Mission: To create a favorable climate for development of political and economic cooperation between the EU and its neighboring countries. Number of participants (2010): 2,350, from over 60 countries 2011 theme: European Dilemma: Partnership or Rivalry? 2011 debates: • Unconventional gas – a Chance for Poland and Europe? • European Financial System – from one crisis to another • New business models in the European financial sector in response to regulatory challenges • The future of European regions. Regional Development Strategy 2020 • Is Central Europe likely to become infected with “peripherization”? • The future of euro zone: enlargement, division or liquidation • Are rating agencies biased towards certain EU countries experiencing crisis? Among past guests: Esko Aho, Executive Vice President, Nokia Corporation, Finland; Jose Manuel Barroso, President of the European Commission; Marek Belka, President, National Bank of Poland; Jerzy Buzek, President, European Parliament; Jürgen Fitschen, Member of the Group Executive Committee, Deutsche Bank AG, Germany; Aleksander Grad, Minister of the Treasury, Poland; Toomas Hendrik Ilves, President of Estonia; Bronis∏aw Komorowski, President of Poland; Aleksander KwaÊniewski, President of Poland (1995-2005); Janusz Lewandowski, Commissioner for Financial Programming and Budget, European Commission, Poland; Thomas de Maiziere, Federal Minister of the Interior, Germany; Pedro Pereira da Silva, General Director, Jeronimo Martins Distribution, Poland; Filip Thon, President of the Board, RWE Polska S.A., Czech Republic. Website: www.forum-ekonomiczne.pl

COURTESY OF FORUM EKONOMICZNE

Zygmunt Berdychowski, chairman of the Economic Forum Program Council, talks to WBJ about the critical issues that Polish and European leaders will grapple with at the 21st Economic Forum in Krynica

Mr Berdychowski believes the EU needs to re-focus on modernization and innovation of its weakest economies? Europe has to implement the same reforms which are also confronting Poles: there will have to be cuts in social spending, and more specifically an increase in the retirement age and trimming the size of public administration. Funding also has to be directed toward innovation and away from ineffective and archaic agricultural policies. Currently, 60 percent of the EU budget is earmarked for agricultural policy. This is a complete anachronism. Of course, Polish farmers benefit significantly from this. But at the same time, we need to openly state that this is not an area that gives Europe opportunities for the future. These opportunities should be looked for in innovation and IT, among others. What lessons can be drawn from the crisis for states on the periphery of the euro zone, such as Poland? First and foremost, we have to show a strong determination to avoid indebtedness. The Polish presidency of the EU Council has so far been overshadowed by euro-zone woes. What can Poland accomplish during the remainder of

its presidency? Most importantly, complete Ukraine’s ongoing negotiations toward an association and free-trade agreement with the European Union, and the completion of the Single Market Act. How do you assess progress in Ukraine’s efforts towards integration with the EU? The key will be the aforementioned association and free-trade agreement. If it is possible to finalize it, then I

Krynica will also host a special conference with the ministers of economy of the Eastern Partnership countries (Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine). What can be done to ensure that Belarus, whose economy has suffered recently, does not move further away from Europe? We have to maintain a constant dialogue with Belarusian authorities. This is very difficult because of the current semi-authoritarian gov-

“60 percent of the EU budget is earmarked for agricultural policy. This is a complete anachronism” am convinced that the process of EU integration will speed up. The agreement is difficult to negotiate and sign because Ukraine does not have an open economy. It is somewhat isolated and obstinate on a number of concessions and privileges and it is difficult for the government to break with the past. But, I believe that it will happen and thanks to this, Ukraine will be able to develop faster.

ernment. It is also difficult to accept that on the border of the European Union there is a kind of democratic black hole. This cannot be, and so we have to be very active in our relations with Belarus. Whenever the government in Minsk makes rational changes towards reforming the economy or the country, then these changes should be supported, because we have no other choice. ●

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SEPTEMBER 5-11, 2011

Can Poland remain a green island? ➡ Continued from p. 13 and public investment in Poland. I expect a steady growth in private investments, especially next year,” Mr Janecki said. Concerning consumption, Mr Janecki said information he has received from the private sector and from trade unions suggests there will be a nominal wage increase of around 5-6 percent in Poland in the next quarter. “This would mean an increase in disposable income of some 4 percent,” he said.

Uncertainty It is no secret that many firms

generated strong profits in 2010 and banks witnessed significant increases in deposits, but that situation now appears to be changing. “In Q1 and Q2 of this year, we started to witness a decrease in firms’ deposits, so [it seems that] some investment projects were started this year and should be more visible by 2012,” said Société Générale Polska’s Janecki. The relationship between cash deposits and private investment in Poland is significant as, according to Mr Janecki, unlike more developed economies where most investments are financed through

An island of growth Poland's GDP growth (%), annualized by quarter, 2007-2011 10 9 8 7 6 5 4 3 2 1 0

debt, more than 50 percent of Polish investments are financed from private means. There have also been public investment delays ahead of next summer’s European soccer championships, although a flurry of infrastructure-building activity in the months leading up to the tournament is expected. Retailers, especially those selling television sets, can also expect a boost in sales prior to the games, which will take place just before the Olympics start in London. Previous experience suggests that Poles tend to buy a lot of televisions before big sporting events, and as one of the biggest producers of TV sets in Europe, a rise in demand in other European countries would also benefit this particular sector of Poland’s economy.

increase last year, many expected consumption to fall, but that didn’t happen,” said Urszula Kryƒska, an economist at Bank Millennium. When it comes to the threat of the unemployment rate increasing in the near future, Ms Kryƒska was also relatively upbeat. “Unemployment could rise but not drastically – firms did a lot of restructuring in 2009 and right now it should be much easier for them to weather the tough times without big layoffs. Let’s remember, we are expecting a slowdown next year, not a

Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011

In context Still, there are plenty of external factors over which the Polish government and Polish entrepreneurs have little or no influence. “Risk appetite will be crucial,” according to Mr Janecki, who said an improvement in the global financial markets would mean more FDI heading Poland’s way. An improvement in the situation on global equity markets, moreover, would help strengthen the z∏oty and with it, Poles’ pur-

chasing power. So although all indications suggest that Polish economic growth will continue at a relatively healthy tick – particularly when compared to what is forecast for many major Western economies – nothing can be taken for granted. The government needs to make sure it doesn’t make any false moves in its fiscal policy and Polish entrepreneurs and consumers need to stay cautiously positive. Then it is left to hope that, as in 2009, Poland has that most intangible of advantages – a bit of luck. ●

EU funds The impact of the roughly €67 billion Poland was allotted in development funds for the 2007-2013 budget period cannot be overstated. Thanks in large part to this financing, Poland’s economy remains one of Europe’s most dynamic, despite much of the rest of the continent battling to shake off the recession and sluggish growth. Polish government officials often boast that they preside over Europe’s biggest building site. Almost everywhere you go in Poland, roads, bridges, by-passes, highways and sewage systems are being built. And these are merely the biggest and most visible projects,

Fiscal tightening

Source: Central Statistical Office

recession,” she said.

But won’t the expected continuation of monetary policy makers’ fiscal tightening be an obstacle to growth? “In general, fiscal tightening does harm growth in the short-term but I don’t think the effect will be very negative in Poland. After the VAT

as all across Poland, thousands of development projects are going on in small towns, cities and villages. This has certainly been beneficial in ensuring the economy keeps moving in the right direction. But as talks get under way on the EU’s next long-term budget for 2014-2020, the question remains as to whether Poland and other CEE countries that joined the EU in 2004 and 2007 can keep this cash flowing, especially with growing pressure from the biggest net-payers to cut back on the bloc’s spending. ●

Euro 2012

Miko∏aj Piotrowski, communications director at PL.2012, tells WBJ what benefits the country can expect to reap from Euro 2012 With Poland set to co-host next summer’s European soccer championships along with Ukraine, the tournament’s organizers have big hopes for the positive impact the event will have on the country. Indeed, organizing one of the world’s most important sporting events guarantees global visibility and is a catalyst for both short- and long-term investments that could provide a lasting boost to the economy.

Infrastructure Foremost among investments that will leave a lasting mark on the country are projects related to infrastructure. They include the completion of four modern stadiums in the host cities of Gdaƒsk, Poznaƒ, Wroc∏aw and Warsaw. But most of all, completing longneeded improvements to the country’s roads, railways, municipal transport and airports will inevitably have a direct impact on business and investment opportunities.

Infrastructure investments are forecast to reach z∏.69.6 billion, the lion’s share of the total z∏.81.3 billion earmarked for the whole event. “Better infrastructure will mean improved productivity, creativity and competition in Poland, which will inevitably be good for business,” said Miko∏aj Piotrowski, communications director at PL.2012, the special-purpose entity charged with delivering the tournament. According to a 2010 report commissioned by PL.2012 to measure the impact of the tournament on the Polish economy, acceleration of investments in transport infrastructure (which without the tournament would likely have been completed three years later) will prove to be the major benefit to the economy as a result of hosting the tournament. Improved infrastructure is expected to help boost private investment and higher inflow of foreign direct investments (FDI).

Tourism The other major sector that is set to reap benefits from the event is the hospitality sector, with an expected influx of foreign tourists during the tournament and in the years that

follow. According to PL.2012’s report, total inbound tourism revenues should grow by z∏.5 billion between 2012 and 2020. The biggest annual growth is forecast in 2012 thanks to the inflow of soccer fans and foreign guests to the cities hosting the tournament’s matches. During the tournament an estimated one million people will visit Poland, bringing in up to z∏.850 million. The country also hopes successfully hosting the tournament will increase its attractiveness as a tourist destination in the long term, in much the same way that hosting the 1992 Olympic Games did for Barcelona. To ensure the hospitality sector is as attractive as possible to investors, PL.2012, in cooperation with the Ministry of Regional Development and the Marshall’s Offices of Lower Silesia, Mazowieckie, Pomorskie and Wielkopolskie voivodships, has also established the Euro Academy program, which trains workers across various transport, public and hospitality sectors in professional customer service. “Better customer service will make Poland more attractive and lead to investment opportunities in the hotel and

SHUTTERSTOCK

Championships to boost investment in Poland

Stadium construction for the tournament will have a lasting effect on Poland’s economy restaurant industries, because with better service more people will want to stay in Poland and do business here,” said Mr Piotrowski. PL.2012 estimates the overall economic effect of Euro 2012 will lead to a 1.4-2.7 percent increase in GDP growth (compared to 2009) between 2008 and 2020, with

peak value forecast in 2012, when the GDP is projected to increase by up to z∏.9.5 billion. According to Mr Piotrowski, the country has what it takes to make the best use of this massive opportunity. “People in Poland like to work hard, while Polish experts and managers are educated, experienced and skilled in their

particular areas and have the ability to provide excellent service,” he said. “Poland is also open to investment and new business opportunities, so when combined with the direct impact of Euro 2012, Poland is a great place to look for investment opportunities.” David Ingham

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Banking sector

Having survived the 2009 global financial crisis remarkably well, Poland’s banks may need to do it again as the threat of another crisis looms large Poland’s economy continued to grow through the first financial crisis due in large part to the country’s unwavering banking sector, which emerged mostly unscathed (no government bailouts were required) from the global economic slowdown. With markets jittery about the euro-zone debt crisis and slowdowns forecast around the globe in 2011, will the country’s banks continue to

except BGK are majority foreign-owned. Earlier this year, Poland’s Bank Zachdoni WBK was taken over by Spanish Banco Santander, joining other majority foreign-owned banks BRE, Citi Handlowy, ING, Kredyt Bank, Millennium, Pekao and Raiffeisen Bank Polska. According to Citigroup’s “Contagion Index,” published in July 2011, Poland is one of the most vulnerable countries to euro-area crisis in the world. One of the reasons, Citigroup analysts write, is that the Polish banking sector is strongly linked to euro-area parent banks.

hold steady through the storm?

Similar market makeup Last time around, investors were primarily worried about foreign banks, which form the largest chunk of the Polish banking sector. Now, in 2011, the sector’s composition hasn’t changed dramatically. The country’s largest bank is still state-owned PKO BP, but all other main players

Let the good times roll

Record profits

Net profits of major banks operating in Poland, Q2 2010 vs Q2 2011

But Polish banks and the Polish arms of European banks have been doing very well of late, posting strong profits in both 2010 and 2011. The Polish Financial Supervisory Authority (KNF) estimated the Polish banking sector’s profits grew in 2010 at a rate of 41 percent y/y, to z∏.11.7 billion. By the end of 2011 total profits could reach z∏.15 billion, which would be the highest recorded in Polish banking history, according to Marek JuraÊ, an analyst at Unicredit CAIB.

Q2 2010 (z∏. millions)

Q2 2011 (z∏. millions)

1,000 900 800 700 600 500 400 300 200 100 0 PKO BP

Pekao

BZ WBK

BRE Bank

Millennium Source: Banks

This makes Polish branches interesting targets for takeovers. The market is set to witness some M&A action this year, with Belgium’s KBC Group and Portugal’s Millennium BCP having expressed an interest in selling their Polish assets (Kredyt Bank and Millennium, respectively). France’s BNP Paribas and Russia’s largest lender, Sberbank, have already declared their interest in potential takeovers in the Polish banking sector.

Strong confidence

Poland’s banking sector looks healthy, experts say

Poles currently seem to have maintained faith in their own banking institutions, with a March 2011 study from Ernst & Young showing that only a quarter of Poles surveyed expressed a decline in confidence in their banking sector, largely due to its performance during the crisis. That compares to drops in confidence across the globe, including 63 percent of Britons, 61 percent of Germans, 58 percent of Spaniards and 55 percent of Americans all expressing less confidence in their banking sector than a year previously. According to Marcin

Mrowiec, chief economist at Bank Pekao (owned by Italy’s UniCredit), Poles have good reason to rest assured. Poland’s banking sector is much healthier than the rest of Europe’s, he said, as evidenced by recent stress tests undertaken by major banks active in Poland. Another sign that investors continue to perceive the Polish banking sector as a safe haven is foreigners’ continued interest in Polish Treasury bonds. “Between 2008 and now, the value of Polish Treasury bonds held by foreigners has increased from z∏.60 billion to

British firm 3Legs Resources announced in June 2011 that it had discovered high concentrations of shale gas in ¸ebieƒ, northern Poland. It was the first reported successful endeavor since drilling activity had begun in Poland a year earlier. Deposits of shale gas were discovered soon after by Poland’s natural-gas monopolist PGNiG near Kutno, in central Poland. PGNiG also started test-drilling shale gas formations in northern Poland. Other multinationals working in Poland’s shale basins include Chevron, ConocoPhilips, ExxonMobil and Marathon Oil from the US, San Leon Energy from Ireland and Realm Energy International from Canada. The main service companies involved in the drilling and exploration at present are Haliburton and Schlumberger, working with operators such as PGNiG and Lane Energy.

Road blocks The key issue for shale gas production in Poland, as elsewhere, is how to get that gas to other markets, Grzegorz Pytel, European Commission Advisor and Senior Expert at Poland’s Sobieski Institute, said in a speech on the topic in Vienna.

Mr Pytel pointed to the fragmented demand for natural gas in Central and Eastern Europe, with Poland at 15 bcm per year, Finland at 9 bcm, the Czech Republic at 9 bcm, Slovakia at 6 bcm, Lithuania at 4 bcm, and Sweden at only 1 bcm. “The problem is the market fragmentation,” he said. “Europe has no route to transport significantly from north to south.” Then there is the actual amount of shale gas available. Stanis∏aw Rychlicki, chairman of the supervisory board at PGNiG, told the Natural Gas for Europe website that it was difficult to estimate the company’s recoverable resources, emphasizing that the numbers being thrown around these days are “just estimates.” Indeed the Polish Geological Institute has yet to release its own official estimate on the amount of shale gas in Poland. “Risks include the unrecognized geology of gas shales, [as well as] urbanization of the area on which occurrence of unconventional gas is expected. We have more than 40 percent of environmentally protected areas in Poland, which is a problem for exploration and production,” Mr Rychlicki added. There is also limited access to sufficient water in Poland,

SHUTTERSTOCK

Poland’s shale-gas gold rush ➡ Continued from p. 13

Questions remain regarding Poland’s shale gas potential which means “having 10,00020,000 cubic meters of water could be a problem,” he said. High capital costs, lack of proper technologies and uncertainty concerning gas prices are all additional dangers, according to Mr Rychlicki, who said that, despite all of these risks, PGNiG hopes to be an exporter to other countries of the EU. Despite the unknowns and the hills to climb, the payoff could be huge. As energy use worldwide grows and alternative energy sources are sought, companies are banking on increased demand for natural gas. If they want to find out if they can make shale gas

SHUTTERSTOCK

Banking on stability

extraction from Poland profitable, they will have to continue exploring – and investing – over the next several years. Ernest Wyciszkiewicz, energy security expert at the Polish Institute of International Affairs (PISM), sees a long road ahead. “Finding shale gas is only the first step. The whole story has only just begun.” Jo Harper

This is an edited version of a story that can be found in Warsaw Business Journal Group’s Investing in Poland 2012 which is now available for order. E-mail: kwilinski@valkea.com

approximately z∏.150 billion … and this trend is increasing all the time,” Mr Mrowiec said. Indeed, in August, editors at Global Finance, an industry magazine, ranked Poland’s Pekao, BZ WBK and BRE Bank respectively the fourth-, fifth- and sixth-safest banks in Central and Eastern Europe (including the Russian Federation). So while no one can predict what a second crisis may bring, it’s hard not to conclude that Polish banks find themselves in a particularly comfortable position. Ella Pa∏ka

WEATHERING THE STORM

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SEPTEMBER 5-11, 2011

Investing in Poland 2012

Warsaw Business Journal Group’s Investing in Poland 2012 is now available, and is being distributed at the Economic Forum in Krynica-Zdrój this week. Its official launch will take place on September 20 in Warsaw. The publication examines the investment climate in all of Poland’s voivodships, and provides key information on economic and business trends in Poland, as well as advice on how to set up a business, how to obtain government aid and how to approach taxes and accounting in Poland. Below is just a taste of what you can expect to find in Investing in Poland 2012. See data and analysis on the Ma∏opolskie voivodship below. Want more pick up a copy of Investing in Poland 2012 today. While it is one of Poland’s smallest voivodships by area, Ma∏opolskie is the second-

most densely populated and has one of the country’s largest regional economies. Moreover, Ma∏opolskie was recently ranked by the Gdaƒsk Institute for Market Economics as Poland’s fourth-most attractive region for investment in 2010, while the Financial Times ranked it second-best in Central and Eastern Europe when it came to strategies for attracting business last year. The region is also one of the richest in natural resources, with substantial oil and gas deposits as well as deposits of rock salt, zinc, lead, limestone and sandstone. Ma∏opolskie is also home to many institutions of higher education, attended by over 210,000 students. As a consequence it has a well-educated workforce and has been able to attract firms looking to outsource business process activities. International corporations

such as Electrolux, Google, IBM Software, Philip Morris, Tesco and Lufthansa all have BPO centers in the region. Apart from BPO/SSC/IT, foreign capital also goes to sectors such as industrial production, construction, electronics, food production and energy. The local and regional authorities offer attractive incentives for investors, including a z∏.27 million capital investment fund offered through the Ma∏opolska Regional Development Agency for new companies that implement innovative solutions. Ma∏opolskie is also home to the Kraków Technology Park, a special economic zone whose purpose is to develop innovative businesses. Today investors such as Motorola Polska Electronics, RR Donnelley Europe, Shell Polska and Arcelor Mittal are all present in the park. Other industries including

SHUTTERSTOCK

Ma∏opolskie voivodship

Kraków is the capital of the Ma∏opolskie voivodship eventually run the length of Poland from Germany to Ukraine, will cross the voivodship. The John Paul II International Airport Kraków-Balice, also serves the entire region. ●

nence. Ma∏opolskie boasts welldeveloped transport infrastructure, at least in comparison with much of the rest of the country. The A4 highway, which will

food, rubber and steel production are also well-established in the region, while many, including the telecommunications, computer and pharmaceutical industries, are gaining in promi-

Ma∏opolskie Voivodship budget Voivode: Stanis∏aw Kracik Marshall: Marek Sowa Area: 15,183 sq km Population (Dec 2010): 3,310,094 Working-age population (Dec 2010): 2,108,035 Unemployment rate (June 2011): 9.9% Average monthly wage (June 2011): z∏.3,357.63

2010: Revenues: z∏.1.07 bln Expenditures: z∏.1.19 bln Deficit: z∏.121.6 mln 2011 (projected): Revenues: z∏.1.17 bln Expenditures: z∏.1.36 bln Deficit: z∏.196.65 mln

GDP (2008): z∏.94.79 billion, up 9.4% y/y (7.43% of national GDP)

Key contacts:

Natural resources: coal, construction ceramics, curative and thermal waters, dolomite, lead ores, limestone, loam, natural gas, peat, rock salt, sandstone, zinc

Malopolska Regional Development Agency (MARR) ul. Kordylewskiego 11, 31-542 Kraków tel. (+48) 12 617 66 01, marr@marr.pl, biuro@marr.pl

Number of students of higher education: 211,938 Number of institutions of higher education: 34 Major universities: AGH University of Science and Technology, Jagiellonian University, Kraków University of Economics, Kraków University of Economics

Jacek Adamczyk, international co-operation specialist, English, Spanish and French speaker tel. (+48) 12 620 91 45, jacek.adamczyk@marr.pl

Major airport: John Paul II International Airport Kraków-Balice Special Economic Zones:

Wolbrom Miechów

Katowice Special Economic Zone: 15 ha Olkusz

Kraków Technology Park Special Economic Zone: 462.98 ha

Szczucin Słomniki

Euro-Park Mielec Special Economic Zone: 21 ha

Proszowice

Estimated investment Total (2009): z∏. 14.9 billion

Chrzanów

Dąbrowa Tarnowska

Zabierzów

Wawrzeńczyce

Oświęcim

Kraków

(private sector: z∏. 8.95 billion; public sector: z∏.5.95 billion) Of which: Industry: z∏.3.79 billion, of which: Manufacturing: z∏.2.08 billion Transport, storage and communication: z∏.2.63 billion Real estate, renting and business activities: z∏.2.29 billion Trade and repair: z∏.1.68 billion Construction: z∏.613 million

Wola Rzędzińska

Niepołomice

Tarnów

Wieliczka

Skawina

Brzesko

Bochnia

Kęty

Tuchów Andrychów Myślenice Pcim

Limanowa Mszana Dolna

Rabka-Zdrój

Biecz Męcina

Nowy Sącz Brzezna Stary Sącz

Number of new commercial and civil law partnerships registered (2010): 3,148, up 15% y/y Number of new sole proprietorships registered (2010): 31,656, up 14.4% y/y

Nowy Targ Szczawnica

Recent major investors: Arcelor Mittal, Capgemini, Electricite de France, Ericpol Telecom, Google, IBM, iLoop Mobile, Infusion, Intelenet, Lufthansa, Luxoft, MAN Trucks, Motorola, Nidec, Nokia, Philip Morris, Sabre Holding, Shell, TriGranit Sources of major foreign investment: China, Germany, India, Spain, the UK, the US

Gorlice Grybów

Białka Tatrzańska Zakopane

Krynica-Zdrój

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WEATHERING THE STORM

SEPTEMBER 5-11, 2011

CEE region

Mike Kubena, CEO of PwC for Central & Eastern Europe, speaks to WBJ about Poland's role in the region and the country’s ability to remain competitive in a changing economic landscape Andrew Kureth: What are the key factors for growth in the CEE region and how does Poland play into that vision? Mike Kubena: As we saw during the crisis of 2008-2009, the world’s economies are more interdependent than ever before, so what happens in Western Europe, America or even China can have a strong impact on the markets here. Poland has stood out in recent years, having been the only country in Europe to continue growing through the financial crisis. There has been a lot of debate as to why it fared so well. Many people point to strong domestic demand, combined with the low value of the z∏oty at the time, which contributed to a surge in Polish exports. And of course the Polish financial sector is quite conservative, so banks here were not affected as badly as in other parts of the world. That said, this is not a time to be complacent. Worldwide recovery from the crisis has been slow, and in recent weeks we have seen evidence that we could be entering another period of turmoil. The European sovereign debt crisis, downgrade of the US debt and drops on stock exchanges are troubling signs and present a threat to CEE’s growth over the next two to three years. Over the long term, the modernization of economies is a key driver of growth in this region. I have been living in CEE for the last 20 years and have witnessed huge improvements in infrastructure, but the region still has a way to go to catch up with Western Europe. We are working with clients in both the public and

private sectors who are investing to fuel future growth, whether it be building roads, modernizing production facilities, or strengthening communications infrastructure. This drive to modernize also includes innovation and the development of a knowledge economy. Countries and individual companies must continually strive to develop new and better ways of doing things. Governments can encourage growth by continuing tax, legislative and economic reforms and creating a business-friendly climate, both for foreign investors and for domestic “middle market” companies. As Poland gets richer, its salaries are rising. As a result when it comes to labor costs, it can’t compete with EU countries like Romania and Bulgaria. What can Poland do to remain competitive in this environment? Some of the things that made Poland attractive in the past, for example the low-cost workforce and privatization of state-owned assets, will not be sustainable advantages in the future. The economy is developing beyond that point. Salaries here are increasing, so companies seeking low-cost labor are increasingly looking to countries like Bulgaria or Romania, or even further afield to India or China. And while Polish salaries are not yet at the level of Western European countries, competing on the basis of low labor costs is not tenable in the long term. To stay attractive to foreign investors, Poland needs to focus on its strengths. Its edu-

cated workforce is certainly a competitive advantage, and universities and businesses must work together to make sure that young people are learning the skills they will need to be successful in the future. Poland is one of the largest countries in Europe and the market of almost 40 million people will continue to be attractive, particularly as the economy gets richer and people have more disposable income. The country’s strategic location in the heart of Europe is another benefit, so investing in transportation infrastructure, including opportunities offered by public-private partnership projects, will help maximize this advantage. On a more personal note, having traveled around Poland, I really admire the culture, people and beauty of this country. Together with the quality of life, these are important factors for foreign investors when they come to make investment decisions. Preserving the country’s rich heritage will help to ensure Poland remains an attractive destination. What role does innovation play? Currently, Poland spends about 0.6 percent of its GDP on R&D, far less than the 2 percent EU target. Does it need to meet that target to stay competitive? And if so, how should it go about doing it? Innovation is a passion of mine. As the saying goes, “innovate or die,” so I believe that investing more into research and development (R&D) is certainly a worthwhile investment. A lot of foreign companies establish R&D centers in Poland, attracted by the high number of university educated technology graduates. So with the right encouragement from both the public and private sector, Poland has the poten-

COURTESY OF PWC

Modernization the key to success

Mr Kubena feels innovation is central to improving Poland’s position within the region tial to become a force in this area. Many governments around the world have utilized “innovation clusters” linking the R&D capacities of their top universities to private sector venture capital and strategic investors. This could be an inspiring model for Poland. What about Poland’s human capital? We are told that Poland has some of the besteducated workers in the world, but don’t businesses in Poland have to compete with those in other EU member states, as Poles can now move across EU borders freely? Finding and keeping good people with the right skills is an enormous challenge. Our recent Global CEO Survey found that the war for talent is at the top of CEOs’ agendas. I would say this is particularly relevant here in Poland, as workers here tend to be highly educated and skilled, but many people leave the country to work in countries such as

the UK, Ireland and the Netherlands. I believe that mobility can be a strength, as people can learn and be enriched by working in different cultures. The question is, how do you bring them back? As I have already said, salaries here are increasing, so I think over time the salary difference will be less of a motivator for staying abroad. I think the key to attracting and retaining good people is to offer them a chance to develop themselves and their career. PwC is currently holding an exciting global development program here in Warsaw called Genesis Park, which brings together our highestperforming staff from around the world. The participants work collaboratively on a strategic project to solve real business issues and benefit our global network. The idea is to take people out of their comfort zone by putting them to work on a project outside of their area of expertise. It is not about teaching them leader-

ship theories, but giving them hands-on experience to help them face the tough realities of leadership in a complex world. And strong leaders are key to motivating and inspiring teams. I think it is important to identify and support talented people who have the potential. These people are in demand within the market, so to keep them, you need to offer them challenges and a chance to grow. The best learning comes through on-the-job experience and for this reason I think coaching and mentoring are immensely important, as people have a chance to learn from the experience of more senior colleagues. I also really like the idea of cycles of experience, where staff can diversify their experience by working in different jobs within an organization. And referring back to your question, the foreign experiences of Polish workers can be an important asset in a culturally varied work environment. ●

Polish authorities have cleared the way for Jan Kulczyk’s new skyscraper

W.P. Carey’s Jeffrey Lefleur talks about CEE financing options

LOKALE IMMOBILIA

W a r s a w B u s i n e s s J o u r n a l ’s w e e k ly s u p p l e m e n t o n re a l e s t a t e , c o n s t r u c t i o n a n d d e v e l o p m e n t

Polish tycoons to invest in Port Praski? Ryszard Krauze and Zygmunt Solorz-˚ak, two of Poland’s richest men, held talks recently regarding investment opportunities in Port Praski, a dilapidated neighborhood in Warsaw’s Praga Pó∏noc district that recently received a zoning plan, reported Puls Biznesu. If a deal is reached, Mr Solorz-˚ak would reportedly add the Port Praski investment to Polnord, the developer controlled by Mr Krauze. Erbud and Elektrim, which control Port Praski, would then become shareholders of Polnord. ●

In this issue TriGranit’s Poznań investment. .22 Sjaelso exits Poland . . . . . . . . . . .22 GTC records loss . . . . . . . . . . . . . .23 Poland’s tallest skyscraper . . . .23 Property-related stocks . . . . . . .24 Dom Development increases profit . . . . . . . . . . . . . . .24 Robyg launches new units . . . .24 Vacancy rate falls . . . . . . . . . . . . .24 Green buildings . . . . . . . . . . . . . . .26 W. P. Carey interview . . . . . . . . . .27

Multi-function investments

TriGranit to launch €160 million investment in Poznaƒ The firm has received a building permit for its multi-function project in the city Hungarian real-estate holding TriGranit has received a building permit that will allow it to begin construction on Poznaƒ’s new 5,500-sqm railway station, Poznaƒ G∏ówny, and a neighboring 60,000 sqm shopping center called Poznaƒ G∏ówny City Center. The train station is scheduled for completion in May 2012, ahead of the European soccer championships, with the entire complex set to be completed in H2 2013. Apart from the railway station and the shopping center, the complex will also comprise office facilities, a parking lot and a hotel. These buildings will be completed in the second phase of the investment.

The whole investment will be delivered in three levels. The total cost of TriGranit’s investment is estimated at €160 million. The construction of the station facility alone will cost approximately z∏.110 million. Polish State Railways (PKP) has been in the process of preparing the investment since 2007. In 2009, TriGranit was chosen by PKP from seven other real estate developers to revitalize and renew Poznaƒ’s main railway station. Bose International, in cooperation with the Poznaƒbased architectural firm Pentagram Architects, designed the plans for the investment. PKP has provided four hectares of land in the downtown area of the city for the development.

COURTESY OF BOSE INTERNATIONAL.

BBI Development NFI, one of the investors behind the Plac Unii mixed-use high-rise project in Warsaw, is working on a new office tower scheme in the Polish capital. The skyscraper will be built in cooperation with the owner of a plot in Warsaw’s central district, although the exact location has not yet been disclosed. The two entities recently signed a preliminary investment agreement concerning the joint development, commercialization and sale of a 150 meter building.

SEPTEMBER 5-11, 2011

The Poznaƒ project will include a 960,000-sqm shopping center

Katarzyna Piasecka

Market exit

Sjaelso withdraws from Poland The developer has said that all its projects in Poland will still be completed Danish developer Sjaelso has announced that it is withdrawing from the Polish market because of financial problems caused by the economic crisis. All of the company’s projects in Poland are due to be put up for sale. “Sjaelso has decided to withdraw from the Polish market and focus on the domestic market in Denmark, Norway, Sweden and Finland. The reason behind this decision is not a loss of trust in the Polish market but the financial crisis which particularly affected the Danish real estate market, including Sjaelso,” read the company’s official press release. The company’s Polish portfolio includes the under-construction Scandinavian House

residential complex in Warsaw’s Wilanów district, shopping center Porto 55 in Elblàg and two office projects: Tower Terraces and Post´pu 22, both located in Warsaw’s Mokotów district. The developer wrote, “[Work on unfinished projects] will be continued until the investor finds partners who will take them over within a joint venture or independently. Sjaelso has already undertaken talks with some potential partners.” The developer added that its withdrawal from the Polish market will not be hasty and that it will be present in the country until it manages to sell all of its projects in the market. Katarzyna Piasecka

COURTESY OF SJAELSO POLAND

BBI to build Warsaw tower

•

The Tower Terraces office project in Warsaw is one of the schemes for which Sjaelso is now trying to find a partner

Warsaw Business Journal presents Real Estate weekly newsletter • Know about the newest projects before they’re on the market • Keep up to date on the latest tenders and auctions • Learn the latest trends in Poland’s dynamic office, residential and retail sectors • Find out who’s who in Polish real estate To subscribe: e-mail subscribe@wbj.pl or call +48 22 639 85 68, ext. 201 and sign up for free two-week no-obligation trial subscription

SEPTEMBER 5-11, 2011

LOKALE IMMOBILIA – REAL ESTATE

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Company results

NAP Invest Group to builds in Warsaw

Warsaw Stock Exchange-listed developer Globe Trade Centre (GTC) has posted a €36.5 million loss for the second quarter of this year, a result which largely stemmed from the negative revaluation of its assets in southeastern Europe. According to the chairman of GTC’s supervisory board, Eli Alroy, the region’s economic recovery has been delayed by shock waves from the euro-zone debt crisis. “The main impact of this delay on the retail properties in South Eastern Europe reflects a decrease in spending power … and downward pres-

sure on rental rates in shopping centers, which resulted in a decrease in asset value,” Mr Alroy said in a statement. In the first half of 2011, GTC’s negative revaluationrelated loss stood at €38 million. This, however, still constituted less than 2 percent of the total value of the group’s investment properties, the company said in its financial report. The firm claims it remains resilient to the adverse macroeconomic trends. “The company’s fundamentals are sound, especially given that 50 percent of the standing portfolio operates in Poland,” Mr Alroy said in the statement. Since the market situation remains difficult, GTC plans to act cautiously as far as its future investments are concerned. The developer wants

to stay away from residential projects and focus on office and shopping center schemes. The former will mostly continue to be medium-sized; at a recent press conference Mr Alroy described as risky planned high-rise office developments in central Warsaw, a number of which have recently been announced by developers and investors. Large-scale investments will ensue in the retail segment: GTC, which has just divested its 50 percent stake in Warsaw’s Galeria Mokotów mall, is currently engaged in preparatory work on two new shopping center developments in the Polish capital. Apart from the previously announced project in Warsaw’s Wilanów district, the company is now also pursuing

COURTESY OF WIKIMEDIA COMMONS

GTC records €36.5 million loss in Q2 The company saw negative revaluation of its investment properties in the period

GTC has divested itself of its stake in Galeria Mokotów a major retail investment in the northeast of the city which is expected to be about the same size as the offloaded Galeria Mokotów mall. GTC is currently in the process of acquiring land for

that scheme which is already zoned for retail space, Mr Alroy confirmed. “More details of the project will be published within the next few weeks,” he said. Adam Zdrodowski

Go-ahead given for Poland’s tallest skyscraper Polish aviation authorities have cleared the way for Jan Kulczyk, one of the richest men in Poland, to launch a project to build what would become the tallest skyscraper in Poland, daily Gazeta Wyborcza has reported.

The proposed 282-meter Chmielna Tower skyscraper will be located on ul. Chmielna in Warsaw’s central district. The planned construction falls within a zone protected by the Civil Aviation Office, which until recently forbade

the construction of buildings that have a height of more than 130 meters. Aviation authorities have now reportedly raised the restriction for the area where the skyscraper is due to be built to 290 meters, saying buildings up to this

height won’t affect the safety of planes landing and taking off from Warsaw Chopin Airport. The skyscraper project will be realized by Kulczyk Silverstein Properties, a joint venture of Kulczyk Investments with Silverstein Prop-

erties. Construction on Chmielna Tower is expected to begin in 2013. When finished, the skyscraper should have about 40,000 sqm of usable space, most of which will be taken up by offices. Patrick Halliday

Real estate company NAP Invest Group, best known for its activity in the retail property sector, will launch construction on its first residential project in Warsaw within the next few months. The upmarket scheme will be located on ul. Niemcewicza in the capital’s Ochota district and will comprise three apartment buildings offering a total of 110 housing units. The investment, which has been designed by JEMS Architekci, will be built on land currently occupied by the capital’s Hotel Harctur.

Galeria Echo grand opening WSE-listed developer Echo Investment has officially opened its Galeria Echo shopping and entertainment center in Kielce, Âwi´tokrzyskie voivodship. With its 300 stores and points of service, the mall features the most comprehensive retail offer available in the Polish market, according to the company. ●

LOKALE IMMOBILIA – REAL ESTATE

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SEPTEMBER 5-11, 2011

Residential

Dom Development posts Q2 profit, increases apartment sales

COURTESY OF M+G

The firm has decided not to increase the number of units it has on offer

Dom Development's offer currently includes the Adria project in Warsaw's Praga Po∏udnie district

Warsaw Stock Exchange-listed residential developer Dom Development posted a net profit of z∏.18.8 million in the second quarter of 2011, a result stemming largely from the firm finally beginning to turn over apartments on which construction was launched after the outbreak of the global financial crisis. In Q1 of this year, the company recorded a net loss of z∏.12.3 million, which resulted from the fact that it turned over just 20 housing units in the period. Between

Q3 2008 and Q3 2009 the developer did not launch any new residential projects. In the first half of 2011, Dom Development sold 826 apartments, which marked a 26 percent increase on the same period of last year. In Q2 2011 alone, the company sold 312 units, 37 percent more than in the second quarter of 2010. As of the end of H1 2011, Dom Development was building 3,147 apartments in 21 projects in Warsaw and Wroc∏aw. On offer were 2,120 units; only 236 of them had by that time been completed. In the upcoming quarters, the company plans to keep stable the number of units it

Robyg to launch 1,000 new housing units this year By the end of this year, Warsaw Stock Exchange-listed developer Robyg wants to have launched construction on approximately 1,000 more new apartments in a number of housing projects in Warsaw and Gdaƒsk. Currently, the company is building some 1,350 units in its investments in the two cities. “This will be a new level of

activity for Robyg,” Zbigniew Okoƒski, president of the company’s management board, recently told journalists. He added that the scale of the planned operations testifies to the firm’s strong position in the market and its financial stability. This year, Robyg hopes to sell a total of approximately 1,000 apartments. In the first

half of 2011, the company found buyers for 534 units, compared to 287 in the same period of last year. Throughout 2008, 2009, and 210 the developer said 87, 290 and 542 homes, respectively. In order to deliver a satisfactory number of units in the upcoming years, the firm is now concentrating on, among other things, the development

of its land bank. In Q2 2011, Robyg signed a preliminary purchase agreement concerning land in Warsaw’s Bemowo district, on which some 300 apartments will be built. The firm is currently in the process of negotiating the acquisition of other plots in several locations across the Polish capital. Adam Zdrodowski

Property-related stocks Security

Closing price on Sep 1

% change (week)

52-week low

52-week high

% change (year)

Total shares

Market value (z∏. mln)

BUDIMEX

71.70

4.06

65.00

109.20

-20.60

25,530,098

1,830.51

CELTIC

19.49

17.41

15.55

60.55

N/A

34,068,252

663.99

DOMDEV

29.70

6.07

27.45

50.80

-34.15

24,560,222

729.44

ECHO

3.71

9.12

3.29

5.55

-18.46

420,000,000

1,558.20

120.00

1.95

113.90

188.40

-32.85

4,747,608

569.71

ELBUDOWA ENERGOPLD

3.18

-2.45

2.97

4.10

-11.42

70,972,001

225.69

ERBUD

17.48

12.77

14.70

61.00

-63.73

12,602,711

220.30

GANT

10.17

16.23

8.11

21.20

-49.90

20,499,953

208.48

GTC

12.13

7.92

10.86

24.98

-47.92

219,372,990

2,660.99

HBPOLSKA

1.18

2.61

0.97

3.90

-66.19

210,558,445

248.46

JWCONSTR

9.50

7.83

8.15

18.35

-40.99

54,073,280

513.70

LCCORP

0.94

9.30

0.85

1.69

-42.68

447,558,311

420.70

MARVIPOL

9.20

15.29

7.22

12.81

-16.52

36,923,400

338.59

MIRBUD

2.83

9.27

2.25

4.75

-34.34

75,000,000

212.25

MOSTALWAR

23.38

-1.31

23.38

69.00

-62.89

20,000,000

467.60

MOSTALZAB

1.67

5.03

1.46

3.73

-52.29

149,130,538

249.05

ORCOGROUP

25.10

-3.42

22.72

40.00

-2.71

14,053,866

352.75

PBG

94.00

3.30

89.55

252.00

-59.40

14,295,000

1,343.73

PLAZACNTR

2.95

3.51

2.40

5.39

-43.81

296,738,962

875.38

POLAQUA

14.00

-3.18

12.70

20.60

-25.09

27,500,100

385.00

POLIMEXMS

1.83

-2.66

1.83

4.58

-58.78

521,154,076

953.71

POLNORD

15.00

8.70

13.70

39.41

-59.39

23,798,439

356.98

RANKPROGR

10.40

7.22

9.49

13.60

5.48

37,145,050

386.31

ROBYG

1.23

-2.38

1.20

2.13

N/A

257,390,000

316.59

RONSON

1.13

4.63

1.00

1.70

-30.25

272,360,000

307.77

TRAKCJA

1.91

4.37

1.74

4.97

-56.09

232,105,480

443.32

ULMA

62.00

-1.59

57.20

88.00

-14.42

5,255,632

325.85

UNIBEP

4.60

-1.29

4.47

10.30

-44.78

33,927,184

156.07

WARIMPEX

6.00

-0.83

5.90

10.89

-28.91

54,000,000

324.00

ZUE

8.70

-3.33

7.90

15.14

N/A

22,000,000

191.40

has on offer, which it views as large enough given the present situation on the market, Jaros∏aw Szanajca, president of Dom Development’s management board, said at a recent press conference. In the near future, construction starts will roughly match the level of apartment sales, with Dom Development expecting to launch construction on at least 600

new units by the end of this year, Mr Szanajca said. In Q2 2011, Dom Development remained the largest residential developer in Warsaw in terms of the number of apartments sold. According to redNet Consulting data, the company had a 14.4 percent share of the market in the period. Adam Zdrodow ski

Industrial space

Vacancy rate falls The amount of available industrial stock in Central Europe has decreased due to financing difficulties Vacancy in industrial property throughout the CEE region is becoming increasingly tight. The vacancy rate for the region – including Poland, the Czech Republic, Hungary and Slovakia – currently stands at an average of 11.8 percent, but a number of locations in the region have already seen it fall to below five percent, a recent report by Cushman & Wakefield found. Vacancy rates of 10-12 percent are considered healthy, the study said. “On a well-operating market, such undersupply would motivate developers to quickly launch new development projects. The Central European market, however, still suffers from the restrictive financial policies applied by banks and their cautious positions in respect of financing new development projects,” Ferdinand Hlobil, head of the CE industrial team at Cushman & Wakefield, said in a statement. He added that the financing difficulties had resulted in a distortion of the market, with Slovakia’s 2.5 percent vacancy rate currently repre-

senting a unique situation within Europe. “In all Central European countries with the exception of Hungary, the vacancy rate has been declining gradually ever since 2009. This decline can be expected to continue in the months to come as well,” Mr Hlobil said. According to Cushman & Wakefield data, take-up in the first six months of this year stood at almost 1.5 million sqm, more than in the whole of 2005 and close to the lease volumes recorded in 2006 and 2009. Demand was mainly driven by manufacturing and retail companies, as well as the relocation of warehousing from Western Europe, a trend that is visibly affecting the Polish market. Development activity in Central Europe in the first half of 2011, with just 198,000 sqm having been delivered, lagged well behind the five-year average of over 1.5 million sqm per year. “The hardest affected are the markets in Hungary and Slovakia where no new projects have been developed this year as yet. Poland and the Czech Republic have recorded an increase against last year but the figures still remain very low,” Mr Hlobil said. Adam Zdrodowski

www.wbj.pl

Alterco plans new Wroc∏aw investment Real-estate investor Alterco has announced plans to invest z∏.75 million in Wroc∏aw city center, on the banks of the Oder River. The company has already signed a preliminary agreement for the purchase of two special purpose vehicles which will be created to complete investments at the location. They will manage real estate with a total area of 10 hectares. The investment plans call for a commercial and residential development on the area, with a complex comprising lofts, single-family houses, offices and hotels. Construction work is planned to start in spring 2013.

Two new Panattoni projects under construction Developer Panattoni Europe’s two built-tosuit (BTS) projects, Panattoni Park Gliwice and Panattoni Park Âwiecice II, are under construction. Panattoni Park Gliwice, whose total space will amount to 11,165 sqm, of which 10,165 sqm will comprise a modern warehouse facility and the remaining 1,000 sqm for offices and social areas, is being created for logistics services provider Nagel-Group. ●

LOKALE IMMOBILIA – REAL ESTATE

SEPTEMBER 5-11, 2011

Sustainable office projects

Developers going green in Poland An increasing number of developers are targeting environmental performance certification for their projects The popularity of green building certification systems is on the rise in the Polish market, with developers increasingly deciding to employ green solutions in their new office investments in the country. In Warsaw, for example, some of the largest under-construction and planned office projects, including UBM Realitätenentwicklung’s and CA Immo’s Poleczki Business Park, SwedeCenter’s Business Garden Warsaw and Capital Park Group’s Eurocentrum, are expected to boast green credentials when finished. For its part, Skanska Property Poland, which was one of the pioneers in sustainable development in the Polish market, currently has all of its new projects designed with LEED and EU Green Building certification in mind. The company is currently involved in three office schemes across the country whose names all attest to the developer’s philosophy: Green Corner in Warsaw, Green Horizon in ¸ódê and Green Towers in Wroc∏aw. The growing interest among developers in sustainable developments has not gone unnoticed by property agents: Colliers International has recently announced that in response to its clients’ expectations it is now in the process of creating a green buildings certification department in Warsaw.

COURTESY OF UBM POLSKA

Poleczki Business Park is currently under construction in Warsaw’s Ursynów district Changing attitudes

Cutting costs

When Skanska Property Poland was starting the realization of its first green investments in Poland, the idea of ecological building was something completely new in the country, said Justyna Adamczyk, sustainable development coordinator at the company. Since then, the awareness of both developers and tenants has changed a lot, she added. She stressed that the green building philosophy is not only about limiting the environmental impact but also about making investments that bring quick returns. It is also about doing what your clients expect, according to Eelko Korteweg, commercial director at SwedeCenter. “It is a matter of being able to provide what the tenants require now and [will require] in the future,” he said.

Many real estate market players now stress that the use of environmentally friendly and energy-efficient solutions in new projects is a good business decision that helps to significantly decrease the running costs of a building. “Building owners realize that sustainable construction and reduced environmental impact are simply good for business,” said Marcin Manuszak, sales director at Trane, a provider of energyefficient systems for residential, commercial and other structures. “Building or renovating to LEED standards ensures efficiencies that generally result in cost savings over the life of the building and ultimately help owners see the building as an ‘asset’ rather than an ‘expense,’” Mr Manuszak added. Rudolf Grossmayer, mem-

ber of the management board of Poleczki Business Park, agreed, arguing that green buildings and the certification associated with them are nowadays not a fad but a necessity. “From the developer point of view, I can confirm that the implementation of technology in line with LEED certification in the design of a building does not necessarily generate additional costs,” Mr Grossmayer said. “Through the use of environmentally friendly technology, tenants are those who benefit the most,” Mr Grossmayer said, adding that in the already LEED CS pre-certified Poleczki Business Park complex green solutions will help save energy by up to 25 percent.

Green ambassadors Tenants of green buildings are trained in how to use them and

often later act as their ambassadors, further promoting sustainable development. Mr Grossmayer has seen more client requests concerning green building certification since developer and builder UBM started to pursue certification for its projects. Those requests have come from both international companies, whose policies often require ecological solutions, and smaller, environmentally minded firms that know that certification will soon be a must and that they will benefit from it. “Thanks to good experience with the implementation of the LEED CS pre-certificate in Poleczki Business Park, we are now thinking of pursuing LEED or BREEAM certificates for our shopping malls that are currently under construction,” Mr Grossmayer Adam Zdrodowski said.

LOKALE IMMOBILIA – REAL ESTATE

SEPTEMBER 5-11, 2011

www.wbj.pl

Orlen in Ghelamco’s Senator project

Development financing

Looking for new solutions Adam Zdrodowski: What does the situation concerning bank financing in CEE look like now? Jeff Lefleur: The current state of bank financing in CEE remains challenging. Although there has been some slight improvement compared to 2010 in terms of borrowing margins and liquidity, none of this positive movement has found its way outside of “core” real estate product: existing, fully-let, modern retail, office

problem. Likewise, the availability of cheap, high-LTV acquisition financing made the end-market very liquid for completed projects. But now developers are getting squeezed both indirectly and directly with regards to their financing options. Traditional construction financing is simply not what it used to be; many banks have stopped this form of lending in an effort to reduce the overall risk profile

“Developers are getting squeezed both indirectly and directly with regards to their financing options” and logistics assets in prime markets. Lower quality assets, secondary locations, manufacturing properties, and development projects still remain largely unfinanciable. Does this mean that developers in the region are currently increasingly looking for new ways of financing their projects? That’s certainly what we’ve found. Cheap, high-LTV financing is what helped fuel the pre-crisis boom in construction – developers could get projects done with almost no equity, and the super thin margins allowed for carrying the construction debt past completion without much

of their loan pool. The ones that remain have pushed down their LTV offerings, and this in turn means that developers need to contribute much larger amounts of equity into their deals than ever before. So the big picture for development financing is that you have less, more expensive debt and more equity required to get deals done. You also have less banks participating, as well as a limited number of developers and investors with enough equity to support the projects. Which model of development financing is your company proposing?

Developers want to focus on their core competencies of securing land, winning mandates, and managing a project to completion – they need to exit the business of short-term real estate trading for profit. The developer should earn a reasonable fixed fee for their services, and let an institutional investor with balance sheet strength and a longer investment horizon take the development and exit risks. A fee-based model allows developers to secure a predictable profit without any equity contribution, without scrambling to find construction financing, and without searching for and negotiating with a forward investor. More importantly, a fee-based model allows them to move forward and not waste time – they can quickly move on to analyzing the next opportunity and winning the next mandate as opposed to getting stuck for the whole year on finding a way out of an unfinanciable project. What is a development company offered and what is required of it in such a deal? As a proven long-term investor with a sizable equity base, I think that W. P. Carey is one of the few investors that can fully support a fee-based development project; we can commit to fund 100 percent of the construction cost, starting with an immediate purchase of the land parcel and then funding all construction payments until completion. All that we require is that the completed project will be signed to a single tenant on a long-term (15 to 25 years)

triple net lease. There is no restriction on type of asset or location across Poland, or indeed the wider CEE, which means that non-core, secondary market, and special purpose assets can be considered. Have you recently been involved in a project of this kind in Poland? Last year, Panattoni chose to work with W. P. Carey using a fee-based model in which we funded 100 percent of the construction and related

Oil giant PKN Orlen will be the main tenant in Ghelamco Poland’s Senator office project in Warsaw, construction on which is currently underway on ul. Bielaƒska in the capital’s central district. The two companies have just signed a five-year lease agreement, but have not disclosed the size of the area due to be taken up. Designed in the same style as a building erected at the location in the years 1907-1911 and scheduled for completion in 2012, Senator will comprise 25,000 sqm of A-class office space.

development costs for a logistics facility in Poznaƒ. As a result, the project required no equity from Panattoni to complete. Without having to concern itself with finding bank debt or securing a forward purchaser it was able to focus solely on managing the construction project. The completed facility was fully occupied under a long term triple net lease with Neuca, the largest wholesale pharmaceutical distributor in Poland. ●

Rotaria acquires Alma

COURTESY OF W. P. CAREY

Lokale Immobilia talks to Jeffrey Lefleur, managing director of investment management company W. P. Carey, about bank financing and an alternative development financing option in CEE property markets

Mr Lefleur believes developers should focus on their core competencies

Invesco Real Estate, asset manager of the Alma office building in Warsaw, has sold the 6,000-sqm property to the Polish privateequity company Rotaria. The value of the transaction, in which the seller and the buyer were respectively advised by Savills and Cushman & Wakefield, has not been revealed. The development, which is located on ul. Marynarska, opposite the city’s Galeria Mokotów mall, is comprised of a main building which was refurbished in 1998, as well as an adjoining two-storey section that was erected in 2001 ●

THE LIST

www.wbj.pl

SEPTEMBER 5-11, 2011

Business Guide

Special Economic Zones in Poland Listed alphabetically

Special Economic Zone

Managing company name Address Tel./Fax E-mail Web page

www.bookoflists.pl

Voivodships

Location (main cities)

Total area for investment / Total area available for investment

Industries the SEZ specializes in

Total value of investments (z∏. billions) / Total number of investors

Top investors in terms of value of investment

Total number of new workplaces / Year established

Contacts for investors

Podkarpackie; Ma∏opolskie; Lubelskie; Zachodniopomorskie

D´bica; Gorlice; Jaros∏aw; Le˝ajsk; Lubaczów; Lublin; Mielec; Ropczyce; Rzeszów; Sanok; Szczecin; Zagórz; ZamoÊç

1,135.0 ha 397.0 ha

Aviation; metal working; automotive; plastic component production

4.2 130 (186 permits)

Polskie Zak∏ady Lotnicze (aviation) - US; MTU Areo Engines Polska (aviation) - Germany; Borgwarner Turbo Systems Poland (automotive) - US; Lear Corporation (automotive) - US; Kirchoff Polska (automotive) - Germany

11,953 1995

Ingmar Wycza∏ek; iwyczalek@europark.com.pl; 17 788-7236

Lower Silesia; Wielkopolskie

Jawor; Jelenia Góra; Kamienna Góra; Kowary; Lubaƒ; Ostrów Wielkopolski; Piechowice

368.8 ha 140.0 ha

No specialization, companies from many branches

1.5 42

BDN (printing) - Germany; TBAI POLAND (automotive) - Japan; POLCOLORIT (ceramics) Poland; Takata Petri Parts Polska (automotive) Japan; SOPP Polska (fabrics) - Germany; Wepa Professional (paper industry) - Germany/Poland

3,950 1994

Danuta Lewandowska; d.lewandowska@ssemp.pl; 75 645 1503 ext. 38; Anna Komorowska; a.komorowska@ssemp.pl, 75 645-1503 ext. 34

Silesia; Ma∏opolskie; Opolskie

Bielsko-Bia∏a; Bieruƒ; Cz´stochowa; Dàbrowa Górnicza; Gliwice; Jastrz´bie-Zdrój; Katowice; Knurów; Rybnik; Siemianowice Âlàskie; Sosnowiec; Tychy; Zawiercie; ˚ory

1,917.0 ha 1,010.0 ha

Automotive; electronics; metal and constuction industry

over 16 over 170

General Motors Manufacturing Poland (automotive) US; Fiat - GM Powertrain Polska (automotive) - Italy; NGK Ceramics (automotive) - Japan; Delphi Polska Automotive Systems (automotive) - US; Duda Bis (food industry) - Poland

34,000 1996

Aleksandra Wayda; a_zajusz@ksse.com.pl, 32 251-0736; Wojciech Rusek, wrusek@ksse.com.pl, 32 251-0736; ¸ukasz Ciep∏y lcieply@ksse.com.pl; 32 251-0736

Lubuskie; Zachodniopomorskie; Wielkopolskie

Gorzów Wielkopolski; Gubin Kostrzyn nad Odrà; Nowa Sól; Poznaƒ; Zielona Góra

1,267.5 ha 748.7 ha

Electronics; optics; furniture; machinery and paper

3.5 73 (184 permits)

ICT Poland (paper industry) - Italy; Faurecia Gorzów (automotive) - Spain; TPV displays Poland (electronics) - Taiwan; Arctic Paper Kostrzyn (timber industry) - Sweden; Barlinek Inwestycje Poznaƒ Germany

18,822 1997

Andrzej Kail; kail@kssse.pl; 95 721-9818

528.8 ha 209.0 ha

All sectors of traditional industry, with the exception of manufacturing that requires state licenses; research and development in natural and technical sciences, accounting and audits; call centers

1.5 56 (86 permits)

Comarch (IT) - Poland; RR Donnelley Europe (printing) - US; Motorola Polska Electronics (telecom) - US; ACS Poland (BPO) - Netherlands; MAN Trucks (automotive) - Germany

6,290 1997

Jacek Bielawski; jbielawski@sse.krakow.pl; 12 640-1949

EURO-PARK MIELEC Special Economic Zone

Agencja Rozwoju Przemys∏u SA Oddzia∏ w Mielcu ul. Partyzantów 25, 39-300 Mielec 17 788-7236/17 788-7769 europark@europark.com.pl www.europark.com.pl; www.arp.com.pl

Kamienna Góra Special Economic Zone for Medium Business

Specjalna Strefa Ekonomiczna Ma∏ej Przedsi´biorczoÊci SA ul. Papie˝a Jana Paw∏a II 11 A, 58400 Kamienna Góra 75 645-1503/75 744-2017 strefa@ssemp.pl www.ssemp.pl

Katowice Special Economic Zone

Katowicka Specjalna Strefa Ekonomiczna SA ul. Wojewódzka 42, 40-026 Katowice 32 251-0736/32 251-3766 ksse@ksse.com.pl www.ksse.com.pl

Kostrzyn-S∏ubice Special Economic Zone

Kostrzyƒsko-S∏ubicka Specjalna Strefa Ekonomiczna SA ul. Or∏a Bia∏ego 22, 66-470 Kostrzyn nad Odrà 95 721-9800/95 752-4167 info@kssse.pl www.kssse.pl

Kraków Technology Park Special Economic Zone

Krakowski Park Technologiczny Sp. z o.o. Al. Jana Paw∏a II 41 L, 31-116 Kraków 12 640-1940/12 640-1945 biuro@sse.krakow.pl www.sse.krakow.pl

Ma∏opolskie; Podkarpackie

Gorlice; Kraków; Ksià˝ Wielki; Nowy Sàcz; OÊwi´cim; Tarnów; Zator

Legnica Special Economic Zone

Legnicka Specjalna Strefa Ekonomiczna SA ul. Kardyna∏a B. Kominka 9, 59-220 Legnica 76 727-7470/76 727-7474 lsse@lsse.eu www.lsse.eu

Lower Silesia

Chojnów; G∏ogów; Legnica; Lubin; Âroda Âlàska; Z∏otoryja

1,041.8 ha 723.5 ha

Automotive; construction, metal industry

4.4 52 (93 permits)

VW Motor Group (automotive) - Germany; Sitech (automotive) - Germany; Winkelmann (boiler systems) - Germany; Gates Polska (automotive) US/UK; TBMeca (automotive) - Japan/France

8,394 1997

Wies∏aw Sowiƒski; sowinski@lsse.eu; 607-770-712; Iwona Exner; exner@lsse.eu; 76 727-7481

¸ódê Special Economic Zone

¸ódzka Specjalna Strefa Ekonomiczna SA ul. Ks. Tymienieckiego 22/24 , 90349 ¸ódê 42 676-2753/42 676-2755 info@sse.lodz.pl www.sse.lodz.pl

¸ódzkie; Wielkopolskie; Mazowieckie

Be∏chatów; Ko∏o; Konstantynów ¸ódzki; Kutno; ¸´czyca; ¸ódê; Radomsko; Rawa Mazowiecka; Sieradz; Tomaszów Mazowiecki; Turek; Zduƒska Wola; ˚yrardów

1,182.0 ha 450.0 ha

White goods; packaging; pharmaceuticals; plastics; construction materials; BPO

7.2 167

DELL Products(IT) - US; Gillette Poland International (shaving products) - US; Procter&Gamble (personal care products industry) - Germany; Indesit (white goods industry) - Italy

25,000 1997

Agnieszka Sobieszek; agnieszka.sobieszek@sse.lod z.pl; 42 275-5052; Dorota Lombardi; dorota.lombardi@sse.lodz.pl; 42 275-5051

Pomeranian Special Ecnomic Zone

Pomorska Specjalna Strefa Ekonomiczna sp. z o.o. ul. W∏adys∏awa IV nr 9, 81-703 Sopot 58 555-9700/58 555-9711 invest@strefa.gda.pl www.strefa.gda.pl

Pomorskie; Kujawsko-Pomorskie; Zachodniopomorskie

Gdaƒsk; Grudziàdz; Kwidzyn; Malbork; Stargard Szczeciƒski; Starogard Gdaƒski; Tczew

1,220.0 ha 286.9 ha

White goods and home electronics; electrical and optical equipment production; paper industry

6.4 64

Sharp Manufacturing Poland (LCD panels) - Japan; Orion Electric Poland (electronics) - UK; Bridgestone Stargard (tire production) - Japan; Flextronics International Poland (telephone production) - US; International Paper Kwidzin (paper production) - US; Cargotec Polska (cargo handing solution) - Finland; Weyerhaeuser (innovation forest products) - US

20,000 2001

Iwona Grajewska; i.grajewska@strefa.gda.pl; 58 555-9719

S∏upsk Special Economic Zone

Pomorska Agencja Rozwoju Regionalnego SA ul. Poznaƒska 1A, 76-200 S∏upsk 59 841-2892/59 841-3261 office@parr.slupsk.pl www.sse.slupsk.pl; www.parr.slupsk.pl

Pomorskie; Zachodniopomorskie; Wielkopolskie

Koszalin; S∏upsk; Szczecinek; Tuchom; Wa∏cz

over 400 ha 160 ha

Plastics processing; transportation and warehousing; production of metal goods; timber processing

WND WND

Kronospan Polska (chipboard and paneling production) - Cyprus; Przetwórstwo Rybne ¸OSOÂ (fish canning) - Poland; M&S Okna i Drzwi (wooden doors and windows) - Poland; BAJCAR (doors and windows) - Poland; Nordglass II (car windows production) - Poland

WND 1997

Leonard Ferkaluk; ferkaluk@parr.slupsk.pl; 59 840-1174

Starachowice Special Economic Zone

Specjalna Strefa Ekonomiczna Starachowice SA ul. Radomska 29, 27-200 Starachowice 41 275 41 01/41 275 41 02 sse@sse.com.pl www.sse.com.pl

Âwi´tokrzyskie; Mazowieckie; Opolskie; ¸ódzkie; Lubelskie

I∏˝a; Koƒskie; Mniszków; Ostrowiec Âwi´tokrzyski; Pu∏awy; S´dziszów; Skar˝ysko Kamienna; Starachowice; St´porków; Szyd∏owiec; Tu∏owice

595.8 ha 217.2 ha

Precision mechanics; automotive industry; metalworking; electronics; timber processing; building materials

1.4 67 (127 permits)

Biella Szyd∏owiec (office supplies) -Switzerland; Cerrad (ceramics) - Poland; Cersanit (sanitary ceramics) - Poland; Gerda 2 (metal industry) Poland; Gerda 3 (metal industry) - Poland

2,762 1997

Anna Jaworska; sse@sse.com.pl; 41 275-4445

Suwa∏ki Special Economic Zone

Suwalska Specialna Strefa Ekonomiczna SA ul. Noniewicza 49, 16-400 Suwa∏ki 87 565-2217/87 565-2449 ssse@ssse.com.pl www.ssse.com.pl

Podlaskie; Warmiƒsko-Mazurskie; Mazowieckie

Bia∏ystok; E∏k; Go∏dap; Grajewo; Ma∏kinia Górna; Suwa∏ki

342.7 ha 105.6 ha

Plastics; wood; machinery; building materials; paper; electronics; metal furniture

1.5 61

Pfleiderer MDF (furniture chipboards) - Germany; Rockwool Polska (insulation materials) - Denmark; Porta KMI Poland (doors) - Poland; Impress Decor Polska (printing) - Austria; MALOW (metal industry) Poland

5,343 1996

Marek Koprowski; m.koprowski@ssse.com.pl; 87 565-2217; Beata Kulka; elk@ssse.com.pl; 87 610-6272

Tarnobrzeg Special Economic Zone EURO-PARK WIS¸OSAN

Agencja Rozwoju Przemys∏u SA Oddzia∏ w Tarnobrzegu ul. Zak∏adowa 48, 39-405 Tarnobrzeg - Machów 15 822-9999/15 823-4708 biuro@tsse.pl www.tsse.pl

Podkarpackie; Mazowieckie; Âwi´tokrzyskie; Lubelskie; Lower Silesia

Tarnobrzeg; Stalowa Wola; Nowa D´ba; Staszów; Radom; Jas∏o; Wroc∏aw; Kobierzyce; PrzemyÊl; Tomaszów Lubelski; Janów Lubelski; Siedlce; ¸uków; Wegrów; Nowe Miasto n. Pilicà; KraÊnik; Przasnysz; Horod∏o

1,551.9 ha 535.7 ha

White goods and home electronics production; metalworking; plastics processing

5.84 99 (193 permits)

LG Philips LCD Poland (electronics) - South Korea; ATS Stahlschmidt&Maiworm (automotive) Germany; Sanfarm (pharmaceuticals) - Poland; LG Electronics Wroc∏aw (electronics) - Poland; Heesung Electronics Poland (electronics) - South Korea

18,664 1997

Monika Puzio; monika.puzio@tsse.pl; 15 823-6688 ext. 120

Wa∏brzych Special Economic Zone

Wa∏brzyska Specjalna Strefa Ekonomiczna INVEST - PARK Sp. z o.o. ul. Uczniowska 21, 58-306 Wa∏brzych 74 664-9164/74 664-9162 invest@invest-park.com.pl www.invest-park.com.pl

Lower Silesia; Opolskie; Wielkopolskie; Lubuskie

Wa∏brzych; Dzier˝oniów; Âwidnica; Boles∏awiec; K∏odzko; Nowa Ruda; Kudowa Zdrój; Wroc∏aw; O∏awa; Jelcz-Laskowice; ˚arów; Opole; Skarbmierz; Leszno; Ârem; Krotoszyn

1,685.1 ha 538.0 ha

Automotive industry; white goods production; metalworking; construction industry; plastics processing

11.9 142 (157 permits)

Toyota Motor Manufacturing Poland (automotive) Japan; Toyota Motor Industries Poland (automotive) Japan; Electrolux Poland (white goods industry) Sweden; Faurecia Wa∏brzych (automotive) - France; Cersanit III (ceramics) - Poland

30,027 1997

Wojciech Morel; wojciech_morel@investpark.com.pl; Hanna S´dziak; hanna_sedziak@investpark.com.pl

Warmia-Mazury Special Economic Zone

Warmiƒsko-Mazurska Specjalna Strefa Ekonomiczna SA ul. Kasprowicza 1, 10- 219 Olsztyn 89 535-0241/89 535-9002 wmsse@wmsse.com.pl www.wmsse.com.pl

Warmiƒsko-Mazurskie; Mazowieckie

Bartoszyce; Ciechanów; Elblàg; I∏awa; Lidzbark Warmiƒski; M∏awa; Moràg; Mràgowo; Nowe Miasto Lubawskie; Olsztyn; Ostro∏´ka; Ostróda

782.0 ha 185.8 ha

Timber processing; metal industry; plastics

around 3 36 (63 permits)

Michelin Polska (tire production) - France; LG Electronics M∏awa (TV and monitor production) South Korea; Swedwood Poland (furniture and wooden goods manufacturing) - Sweden; Wydawnictwo Bauer (publishing) - Germany; Wójcik Fabryka Mebli (furniture manufacturing) - Poland

5,404 1997

Krzysztof Gàsior; gasior@wmsse.com.pl 89 535-0241; Pawe∏ Lulewicz; lulewicz@wmsse.com.pl

Notes: Notes: WND = Would Not Disclose. Research for the list was done in August 2010. Number of workplaces are as of August 2010. All information comes from Special Economic Zones and Polish Information and Foreign Investment Agency.

To the best of WBJ ’s knowledge, the information is accurate as of press time. While every effort is made to ensure accuracy and thoroughness, omissions and typographical errors may occur. Corrections or additions to The List should be sent, on official letterhead, to Warsaw Business Journal, attn. Joanna Raszka, ul. Elblàska 15/17, 01-747 Warsaw, via fax to (48-22) 639-8569, or via e-mail to wbjbol@wbj.pl. Copyright 2011, Valkea Media SA. The List may not be reprinted or reproduced in whole or in part without prior written permission of the publisher. Reprints are available.

MARKETS

SEPTEMBER 5-11, 2011

www.wbj.pl

Stocks report

world stock indices DJIA

NASDAQ

11,493.57 (Sep 02 close)

S&P500

2,546.04 (Sep 02 close)

3.08% (for the week)

FTSE100

1,204.42 (Sep 02 close)

5.22% (for the week)

DAX

5,418.60 (Sep 02 close)

3.89% (for the week)

5.22% (for the week)

Regaining lost ground

NIKKEI225 5,730.63 (Sep 02 close)

9,060.80 (Sep 02 close)

2.62% (for the week)

3.29% (for the week)

CHANGE: -3.69%

CHANGE: -4.88%

CHANGE: -7.82%

CHANGE: -13.03%

CHANGE: -19.92%

CHANGE: -15.26%

(year to Sep 2)

52-week high: 12,928.50

52-week high: 2,887.75

52-week high: 1,370.58

52-week high: 6,105.80

52-week high: 7,600.41

52-week high: 10,891.60

52-week low: 10,304.40

52-week low: 2,173.71

52-week low: 1,080.39

52-week low: 4,791.00

52-week low: 5,345.36

52-week low: 8,227.63

Andrew Nawrocki, Market analyst & trader, gowebtrade.com The past two weeks saw stock markets climbing upwards after a recent period of sell-offs. Market volatility, as measured by the VIX – CBOE indicator, dropped from about 42 points on August 22, to about 32 as of September 1. The key question now is whether the past two weeks of gains were part of an opportunistic buy-back of cheap shares, or are a sign that we are finally entering a longer-term upward trend. The macroeconomic data paints a mixed picture. The big event of the past two weeks was the US Federal Reserve’s annual meeting in Jackson Hole, where investors essentially saw Fed chairman Ben Bernanke buying more time. Prior to the meeting, durable goods orders for the month of July

Major indices WIG

41,553.09 (September 2 close)

WIG20

2,414.64 (September 2 close)

01.09

31.08

30.08

29.08

26.08

25.08

24.08

23.08

22.08

19.08

18.08

17.08

16.08

01.09

31.08

30.08

29.08

26.08

25.08

24.08

23.08

22.08

2,100

19.08

37,000

18.08

2,180

17.08

38,200

16.08

2,260

12.08

39,400

11.08

2,340

10.08

40,600

09.08

2,420

08.08

41,800

05.08

2,500

04.08

43,000

12.08

52-week low: 2,194.07

11.08

Change year to September 2: -15.99%

10.08

52-week low: 37,368.93

09.08

52-week high: 2,932.62

Change year to September 2: -16.65%

08.08

Change for the week: 4.33%

05.08

52-week high: 50,371.74

04.08

Change for the week: 4.63%

Top 5 OPONEO.PL COGNOR DMWDM NETMEDIA STALPROD

Closing 10.95 4.49 0.51 5.30 271.10

% change (week) 52-week high 30.2 16.38 25.77 5.72 24.39 1.00 23.26 8.89 23.23 419.60

52-week low 8.25 2.40 0.36 4.20 220.00

Top 5 ASSECOPOL PKNORLEN PEKAO GTC GETIN

Closing 42.85 39.3 147.00 12.13 9.14

% change (week) 10.61 8.32 8.25 7.92 6.28

52-week high 56.45 57.90 196.50 24.98 15.29

52-week low 36.39 34.01 123.40 10.86 7.98

Bottom 5 CAMMEDIA WILBO WANDALEX MOSTALEXP TFONE

Closing 4.00 0.83 2.19 0.72 2.70

% change (week) -33.22 -17.82 -17.05 -15.29 -14.56

52-week low 4.00 0.83 1.82 0.72 2.70

Bottom 5 POLIMEXMS PKOBP LOTOS CEZ BRE

Closing 1.83 35.36 30.2 133.00 262.00

% change (week) -2.66 -2.66 -1.47 0.08 0.77

52-week high 4.58 46.81 49.42 154.10 349

52-week low 1.83 33.10 30.00 118.70 237.10

52-week high 11.22 2.49 3.19 1.85 7.38

Calm after the storm

sWIG80

NewConnect

45.26 (September 2 close)

WIG-Banki

01.09

31.08

30.08

29.08

26.08

25.08

24.08

23.08

22.08

52-week low: 8,670.88

19.08

17.08

16.08

52-week high: 12,932.00

12.08

11.08

01.09

31.08

30.08

29.08

26.08

25.08

24.08

23.08

22.08

19.08

8,600

18.08

2,000

17.08

8,980

16.08

2,100

12.08

9,360

11.08

2,200

10.08

9,740

09.08

2,300

08.08

10,120

05.08

2,400

04.08

10,500

10.08

Change year to September 2: -24.89%

09.08

52-week low: 2,101.80

08.08

Change year to September 2: -19.39%

05.08

Change for the week: 3.31%

04.08

52-week high: 2,987.72

2,500

5,916.00 (September 2 close)

SOURCE: WSE

01.09

31.08

30.08

29.08

26.08

25.08

24.08

23.08

22.08

19.08

18.08

17.08

16.08

01.09

31.08

30.08

29.08

26.08

25.08

24.08

23.08

22.08

19.08

5,200

18.08

17.08

5,380

16.08

12.08

5,560

11.08

10.08

5,740

09.08

08.08

5,920

05.08

04.08

6,100

12.08

52-week low: 5,222.29

11.08

Change year to September 2: -19.59%

10.08

52-week low: 44.66

09.08

52-week high: 7,387.49

Change year to September 2: -28.88%

08.08

Change for the week: 5.68%

05.08

52-week high: 64.04

04.08

Change for the week: 0.35%

Pawe∏ Kordala, X-Trade Brokers Dom Maklerski SA

9,504.95 (September 2 close)

Change for the week: 4.38%

18.08

2,362.29 (September 2 close)

in the US came in much stronger than expected, pushing indices higher around the globe. For the week ending August 26, the WIG performed surprisingly well, closing 2.63 percent higher, the blue-chip WIG20 was up by 2.70 percent. Monday, August 29 started well, with the main impetus for the week coming from news of a merger between two of Greece’s biggest banks (seen widely as a step forward in resolving the dire financial state of the debt-ridden nation). Further good news came when US consumer spending data for the month of July saw its largest increase in five months. For the week, Polish indices rode on global sentiment and the WIG closed 1.25 percent higher. ●

Currency report

Other indices mWIG40

After the roller-coaster ride on stock markets in the first half of August, along with the rising value of the Swiss franc and gold, the first few days of September brought calm to financial markets. Investors appear to believe that recent data from the US economy suggests a big slowdown, but not a recession. Readings from purchasing managers indices for America and Europe are falling, but they are far from levels that would suggest economies are going to start contracting. Figures from the labor market in the US show that the unemployment rate remains above the historical average, but the probability it will rise above 11 percent any time soon is very low. Moreover, the US Federal Reserve may decide to launch a new program of quantitative easing if stock markets tank sig-

nificantly in the future. Thanks to the recent bursting of the Swiss franc bubble, the CHF/PLN has gone down to around z∏.3.70. The EUR/PLN (z∏.4.15) and USD/PLN (z∏.2.92) currency pairs have remained relatively stable. Generally, the Polish economy is in good shape. The recently released data on GDP (+4.3 percent in Q2) indicates that prospects for Poland are good. Moreover, the government’s lowerthan-forecast fiscal deficit is helping Poland to borrow money at relatively low interest rates. Nevertheless, because of the slowdown in the German economy (an important export partner) Polish GDP growth in 2012 will probably be below the 4 percent level and unemployment could remain at its current level or may even grow a bit. ●

currency rates

3.7408

3.7482

3.7447

3.7692

29.08

30.08

31.08

01.09

3.8116

3.7468 3.5

26.08

0.1008 02.09

0.1000 01.09

0.0992 31.08

0.0993 30.08

0.0996 29.08

0.0998 26.08

0.08

02.09

3.7466

0.10

02.09

3.6293

PLN-100JPY

4.0

SOURCE: NBP

PLN-RUB

0.12

01.09

3.5373 31.08

3.5298 30.08

29.08

3.6426 26.08

4.7014

4.7431 02.09

3.5

3.5265

PLN-CHF

4.0

01.09

4.6728 31.08

4.6970 30.08

29.08

4.7052 26.08

2.8996

2.9277 02.09

4.6963

PLN-GBP

01.09

2.8695 31.08

2.8755 30.08

29.08

2.8836 26.08

4.1452

4.1687 02.09

2.5

2.8658

PLN-USD

3.0

01.09

4.1445 31.08

4.1498 30.08

29.08

4.1629 26.08

4.1607

PLN-EUR

ARTS & CULTURE

Concert

Festival

Superstar George Michael to perform at new stadium

The old and the new

George Michael Wroc∏aw, Pilczyce Stadium September 17

For more information log onto www.georgemichael.com

Performers including Radiohead guitarist Johnny Greenwood, American composer Steve Reich (described by The New York Times as “our greatest living composer”), dance music pioneer Aphex Twin and Polish jazz pianist Leszek Mo˝d˝er, will entertain fans at this week-long event. The 2011 festival, which aims to meld modern music

COURTESY OF WIKIMEDIA COMMONS

George Michael, who began his music career with the 80’s pop group Wham before going on to score hits that included “Faith” and “Careless Whisper,” will perform the first major concert at Wroc∏aw’s new Pilczyce Stadium this September. He will be accompanied by the Wroc∏aw Philharmonic Orchestra. Up to 28,000 fans are expected to attend the event. Tickets for the concert are priced from z∏.79 to z∏.399. ●

with classical traditions, will be made up of four different projects. These will include “Modern Classic,” presenting the music of Steve Reich and friends; “Made in Poland – Mi∏osz Sounds,” presenting new works by five renowned composers of the younger gen-

eration in Poland; “Debuts” dedicated to young music groups emerging on the scene; and “Freak,” focused on more unusual electronic music compositions. ● For more information log onto www.sacrumprofanum.com

International ballet festival 3rd Days of Dance Teatr Wielki, pl. Teatralny 1 September 12-28

‘Lady in Red’ comes to the capital

Irish singer and composer Chris de Burgh, famous for

Polish pianist Leszek Mo˝d˝er will perform

Dance

Concert

Chris de Burgh Sala Kongresowa, pl. Defilad 1 September 13

The 9th Sacrum Profanum Festival of contemporary Classical Music Kraków September 11-17

SEPTEMBER 5-11, 2011

COURTESY OF WIKIMEDIA COMMONS

www.wbj.pl

such songs as “High On Emotion,” “A Spaceman Came Travelling,” “Don’t Pay The Ferryman” and of course the timeless classic “Lady in Red,” will come to Poland for the fifth time, as part of his tour to

promote his latest album “Moonfleet & Other Stories.” Tickets for the event are priced from z∏.130. ● For more information log onto www.kongresowa.pl

This upcoming ballet festival, which will be held for the third year in a row at the Teatr Wielki (Grand Theatre – National Opera) this autumn, will involve six companies from France, Germany, Japan, the Netherlands and Poland, presenting a diverse repertoire of work. The program focuses mainly on contemporary pieces by famous choereographers such as Pina Bausch, Jiﬁí Kylián, and Krzysztof Pastor, as well as new work by Robert

COURTESY OF WIKIMEDIA COMMONS

Wuppertal Tanztheater will be the festival highlight Bondara, a young choreographer from the Polish National Ballet. The festival’s highlight will be the visit of the Wuppertal Tanztheater who will present works by Germany’s Pina

Bausch who, prior to her passing in 2009, was credited with creating modern dance theater. Tickets are priced from z∏.38. ● For more information log onto www.teatrwielki.pl

Museums, galleries and venues in Warsaw Centre for Contemporary Art at Ujazdowski Castle ul. Jazdów 2 www.csw.art.pl Czarna Gallery ul. Marsza∏kowska 4 www.czarnagaleria.art.pl Galeria 022, DAP, Lufcik ul. Mazowiecka 11a www.owzpap.pl Galeria 65 ul. Bema 65 www.galeria65.com Galeria Appendix 2 (Praga) ul. Bia∏ostocka 9 www.appendix2.com Galeria Asymetria ul. Nowogrodzka 18a www.asymetria.eu Galeria Foksal ul. Foksal 1-4 www.galeriafoksal.pl Galeria Milano Rondo Waszyngtona 2A (Praga) www.milano.arts.pl Galeria Schody ul. Nowy Âwiat 39 www.galeriaschody.pl

Green Gallery ul. Krzywe Ko∏o 2/4 www.greengallery.pl

Simonis Gallery ul. Burakowska 9 www.simonisgallery.com

Katarzyna Napiórkowska Art Gallery ul. Âwi´tokrzyska 32, ul. Krakowskie PrzedmieÊcie 42/44 and Old Town Square 19/21 www.napiorkowska.pl

State Archaeological Museum in Warsaw ul. D∏uga 52 (Arsena∏) www.pma.pl

Królikarnia National Gallery ul. Pu∏awska 113a www.krolikarnia.mnw.art.pl Le Guern Gallery ul. Widok 8, www.leguern.pl Museum of Independence Aleja SolidarnoÊci 62 www.muzeumniepodleglosci.art.pl National Museum in Warsaw Al. Jerozolimskie 3 www.mnw.art.pl Polish National Opera at Teatr Wielki Pl. Teatralny 1 www.teatrwielki.pl Pracownia Galeria ul. Emilii Plater 14 www.pracowniagaleria.pl

State Ethnographic Museum ul. Kredytowa 1 www.ethnomuseum.website.pl Historical Museum of Warsaw Old Town Square 28-42 www.mhw.pl History Meeting House of Warsaw ul. Karowa 20 www.dsh.waw.pl Warsaw Philharmonic ul. Jasna 5 www.filharmonia.pl Warsaw Rising Museum ul. Grzybowska 79 www.1944.pl

Galeria XX1 Al. Jana Paw∏a II 36 www.galeriaxx1.pl

Rempex Art and Auction House ul. Karowa 31 www.rempex.com.pl

Wilanów Palace Museum and Wilanów Poster Museum ul. St Kostki Potockiego 10/16 www.milanow-palac.pl www.postermuseum.pl

Galeria Zoya ul. Kopernika 32 m.8 www.zoya.art.pl

Royal Castle Pl. Zamkowy 4 www.zamek-krolewski.com.pl

Zachęta National Art Gallery Pl. Ma∏achowskiego 3 www.zacheta.art.pl

LAST WORD

SEPTEMBER 5-11, 2011

www.wbj.pl

Tech Eye

COURTESY OF GEEKSTUFF4U

It’s a two-trick pony – the Marugoto Tamachan has a warming function so that you needn’t stow it once summer’s done. The only downside we can see is that it might not accommodate those expensive square watermelons the Japanese developed a decade or so ago. You can find the Marugoto Tamachan in the Far East of the interwebs as long as you can communicate in Japanese. Those of us more comfortable with English will have an easier time getting one from geekstuff4u.com. It costs around $350, but that seems a small price to pay for a bit of UFO-shaped, watermelon-filled gadgetary goodness. Meanwhile, it seems there’s a lamentable dearth of innovative, rhino-related technology in the world today. We searched high and low for a product to do justice to our exploding dream rhinos, but the only thing we could find is the latest Animal Chair from Spanish COURTESY OF MAXIMO RIERA

A Caucasian man in a pink kimono, a bowl of chilled watermelon juice and a pair of swollen baby rhinos – those were the principal characters of a dream Techeye had last week. We can’t remember all the details, but a few scenes have been seared into our brain, like the part where the man declared his unrequited love for the watermelon juice. And we’ll never forget the end, when the rhinos chanted “lorem ipsum dolor sit amet” over and over in unison, before exploding in a shower of rhino dust, tainting the watermelon juice and leaving the man curled up on the floor, sobbing bitterly for his true love lost. Weirdly – and rather disturbingly – we woke up with a powerful hankering for watermelon. What that says about Techeye is best left unconsidered, or else the

boys in white might show up at our door again. But it makes for fine inspiration when looking for new toys. To satisfy any watermelon-related hankerings we might have in the future, there’s the Marugoto Tamachan Watermelon Portable Cooler. With its 14-liter capacity, this gadget can cool a whole lot of melon (or whatever other snacks you decide to throw in it). And this isn’t a one-trick pony, no sir.

COURTESY OF STEM INNOVATION

The dream and the darkly inspired

designer Maximo Riera available at maximoriera.com. Anyone reading this column back in January might remember Riera’s Octopus Chair, an item best described as “Cthulhu meets leather upholstery.” This time around the designer has embraced his inner quadruped and produced a rhino chair that would look great in any room populated with mutant furniture.

Like Riera’s earlier piece, the Rhino Chair is a one-of-a-kind objet d’art, so we’re not sure if it’s for sale. But if it is, you can expect to pay the equivalent of a lifetime supply of square watermelons. Last up this week is the iZON Remote Room Monitor from Stem Innovation steminnovation.com. According to its maker, the iZON is “an app-controlled video camera that enables live streaming of audio and video to an Apple iOS device,” which means aficionados of Android OS devices are out of luck for now. But those worshiping at the altar of Apple can keep a constant eye on their offices, children and/or comic book collections, with the option of automatically uploading the recording to YouTube. Price: $130. Why is Techeye talking about this product rather than something involving a pink-kimono-wearing man? The answer is simple: we looked, and oh how we regret looking. “What has been seen cannot be unseen,” as they say. But we sincerely hope that what has been seen will not be seen again in our next dream. ●

Ever tried to fit a square watermelon into a round watermelon cooler? Let us know: techeye.wbj@gmail.com