WBJ #22 2013

Fueled by FDI

Another cut, another record

A recent report shows that Poland is a CEE leader in the number of FDI-related jobs created

Poland’s central bank cut its main interest rate yet again, and doesn’t exclude more cuts soon

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WWW.WBJ.PL

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VOLUME 19, NUMBER 22 • JUNE 10-16, 2013 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

Since 1994 . Poland’s only business weekly in English

COURTESY OF THE OFFICE OF DAVID USUPASHVILI

Yours to explore The number of tourists coming to Poland is on the rise, thanks to luxury hotels, big events and a splash of 12-13 tradition

Georgia on my mind The chairman of Georgia’s parliament, David Usupashvili, talks about building a culture of democracy in his country 8-9

Eyes on the prize Tesco’s CEO for Poland, Ryszard Tomaszewski, talks about how his company plans to battle economic slowdown as retail sales continue to slide 6

News . . . . . . . . . . . . . . . . . . . . . . .2-4 Business . . . . . . . . . . . . . . . . . . . .5-6 Finance & Economics . . . . . . . . . . .7 Interview . . . . . . . . . . . . . . . . . . .8-9 Opinion & Analysis . . . . . . . . .10-11 Cover Story . . . . . . . . . . . . . . .12-13 Lokale Immobilia . . . . . . . . . .14-17 The List . . . . . . . . . . . . . . . . . . .18-19 Markets . . . . . . . . . . . . . . . . . . . . .20 Sports . . . . . . . . . . . . . . . . . . . . . . .21 Lifestyle . . . . . . . . . . . . . . . . . . . . .22 Last Word . . . . . . . . . . . . . . . . . . . .23

SHUTTERSTOCK

In this issue

Chinese choice

All talk?

Speaker of the Sejm Ewa Kopacz was in China to solidify business ties – and mention human rights 3

Secretary of State John Kerry vows the US wants Poland in the Visa Waiver Program 7

NEWS

www.wbj.pl

Hanna Gronkiewicz-Waltz

Warsaw Mayor Hanna Gronkiewicz-Waltz Hanna Gronkiewicz-Waltz, mayor of Poland’s capital Warsaw, has come under fire in recent weeks after a series of botched policy moves. She now faces a possible recall vote that could see her removed from office, a potentially huge embarrassment for the ruling Civic Platform party, of which she is deputy leader.

The issue that has caused the most outrage recently are new trash-removal rules set to come into force on July 1. The

regulations are complex and opaque and have left Varsovians confused as to exactly how much they will now have to pay for waste disposal, as well as to whom and under what conditions. The resulting confusion and anger among the city’s inhabitants led to the dismissal of Deputy Mayor Jaros∏aw Kochaniak, who was in charge of implementing the waste disposal system.

Warsaw City Hall now says it will pay the refuse-collecting

companies directly, while inhabitants will continue to pay it a service charge until the end of the year, when the new system will come into force. However, it is not yet clear exactly how much the charge will be. This week, Warsaw’s officials are scheduled to meet to decide the refuse-collection rates. Ms Gronkiewicz-Waltz has insisted that there will be a “smooth transition from June 30 to July 1.”

But Varsovians are also dissatisfied with the slow pace of construction on the city’s second subway line, which has left some main thoroughfares blocked off for weeks. The line was originally supposed to be ready this autumn, but Warsaw authorities have pushed back the completion date to September 2014.

Ms Gronkiewicz-Waltz is now facing a possible recall election. If she is ousted in the referendum, new elections will be called. Some 67,000 people have reportedly already signed a petition to hold the recall vote, about 50 percent of the number needed.

The petition accuses Ms Gronkiewicz-Waltz of cutting transportation funding while implementing the highest prices for public transport in Poland, cutting funding for education, not preparing the city for the new waste management laws and bringing chaos to city management.

Remi Adekoya

148 is how many FDI projects took place in Poland in 2012, the highest number in the CEE, according to Ernst & Young’s European attractiveness survey.

48.0 was the value of Poland’s Purchasing Managers’ Index for the manufacturing sector in May, up by 1.1 points since April, but still below 50 and thus indicating contraction.

0.9% is the OECD’s forecast for Poland’s economic growth this year.

Quote of the Week “In Q1 there was 0.5 percent year-on-year growth and if there is growth of 0.4 or 0.6 percent in Q2, then we’d need a microscope to see it as revival [of the economy].”

National Bank of Poland President Marek Belka, emphasizing the desire to see stronger economic growth in the Monetary Policy Council’s decision to cut interest rates last week.

Figures in focus Young and restless Youth unemployment rates in selected EU countries 80 70 60 50 40 30

62.5

* Highest in EU ** Lowest in EU

56.4 42.5

28.9 27.6 27.4 27.4

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24.7 22.2 21.2 20.2 20.0 12.2 10.6

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On WBJ.pl Europe’s financial crisis has engendered a new generation of political movements across the continent.

Gene Frieda, a global strategist for Moore Europe Capital Management, says these need to be nipped in the bud, or old divisions will return. Find his analysis this week on WBJ.pl

Calendar

June 12

SPEED BUSINESS MEETING

Event:

Speed Business Meeting is a new formula in which participants take part in a series of direct meetings, during which they have a chance to present their company, exchange business cards, make new contacts and find new customers, suppliers and investors.

Sofitel Wroclaw Old Town Hotel, ul. Âw.

Miko∏aja 67, Wroc∏aw bpcc.org.pl

Location:

Web:

24-26 EUROPEAN FINANCIAL CONGRESS Event:

This congress, organized by the Gdaƒsk Institute for Market Economics – Gdaƒsk Academy of Banking, provides space for pragmatic debates of business, political and academic circles. This year’s edition will

Location: Web:

focus on financial security and European integration.

Sopot efcongress.com

27-28 SENIOR HOUSING IN POLAND This conference will address housing issues in the largest growing demographic – senior citizens. The conference will address how demographic, economic and social changes are creating the need for alternative senior housing solutions for the entire senior community.

Location: Kraków, City Council Chamber, Pl. Wszystkich Âwi´tych 3-4 Web: seniorhousing.pl Event:

7.5

%

Europe’s clash of generations

Digital music sales rise In the first quarter of 2013, Poles spent z∏.7.24 million on music in digital form, 53 percent more than in Q1 2012, according to the Polish Society of the Phonographic Industry (ZPAV). Sales rose for all types of digital music, but the biggest increase came in streaming services and those accompanied by advertising – these were up by 92% to z∏.2.84 million, ZPAV said. According to estimates from record firm EMI Music Polska, the digital music market in Poland expanded to z∏.44 million in 2012 from z∏.24 million in 2011. ●

2.75% is the National Bank of Poland’s benchmark interest rate after the Monetary Policy Council cut it by 25 basis points last Wednesday.

Re UK pu blic De nm Ne ar the k rla Ge nds rm an y**

The European Commission said that Poland has not done enough to reform its public finances. The institution presented its recommendations for Poland after it gave the country an additional two years to meet the EU’s deficit-to-GDP ratio threshold of 3%.

The EC said that Poland did not use the time before the economic crisis to restructure public finances and prioritize growth factors. It also did not manage to coordinate public spending at different levels of government.

Numbers in the News

Cz ech

EC criticizes Poland’s public finances

IN THE SPOTLIGHT

ce* Sp a Por in tug al Ita Bu ly lga ria Po lan Hu d ng ar Sw y ed e Ro n ma nia Lith ua nia

Minister of Labor W∏adys∏aw KosiniakKamysz said in an interview with Polish Radio that the government’s review of how open pension funds (OFEs) should pay out money to retirees is “nearly ready” and should be released by mid-June. The OFEs were created as part of Poland’s retirement fund revamp in 1999 and the first pensions from these funds will be paid out next year. The government could propose changes to the system as well, for example shifting funding from the privately managed OFEs to the government-run Social Security Institution.

JUNE 10-16, 2013

Gre e

Pension fund review ready soon

COURTESY OF WARSAW CITY HALL

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Source: Eurostat

Company index Ablon Group ..............................................16 Accor ..........................................................15 ADV Por Property Investment ..................15 All Nippon Airways......................................3 Asbud Group ..............................................16 Atome Associes ........................................15 B&B Hotels France ..................................13 Blue Ocean Investment Group (BOIG) 14, 15 Boeing..........................................................3 BREBank ..................................................12 C&A............................................................16 CBRE..........................................................15 Chopin Airport in Warsaw ........................13 Cushman & Wakefield ..............................14 Danske Bank ............................................11 Dekpol........................................................14 Deloitte ......................................................15 ECE ............................................................14 Echo Investment........................................15 EMI Music Polska........................................2 Emirates ....................................................13 Ernst & Young..........................................2, 5 Ethiopian Airlines ........................................3 Galeria Neptun ..........................................14 Gazprom ......................................................3 Globe Trade Centre ..................................16 Grupa Azoty ..............................................13 GTI Travel ....................................................5 HB Reavis ..................................................14 Heitman International ..............................16 Hilton ........................................................15 Hilton Hotels..............................................13 Hochtief Polska ........................................15 HRS ............................................................14 HSBC ..........................................................7 IBM ..............................................................5 Igloo Architectures ....................................15 Inglot ..........................................................14

InterContinental Hotel Group ..................13 Irlandzka Grupa Inwestycyjna ..................16 Japan Airlines ............................................3 Jones Lang LaSalle ..................................15 JSK Architekci ..........................................14 Kayi Group ..................................................5 LaCie..........................................................23 Litoborski & Marciniak ............................15 LOT ..............................................................3 Markit Economics ......................................7 Marriott......................................................13 Moore Europe Capital Management ..........2 MSI ............................................................23 Neinver ......................................................15 NH Hoteles ................................................13 Nordea Group ............................................15 Novotel ................................................13, 15 nVIDIA ........................................................23 Orbis ..........................................................15 Outlet Center Retail Management ..........15 Paramount ................................................22 PGE ........................................................3, 22 PGNiG ..........................................................3 Philips ........................................................17 PKP ............................................................14 PZU ..............................................................4 Qatar Airways ............................................13 Qatargas ......................................................3 Signal Iduna ................................................5 Skanska ....................................................15 T-Mobile ....................................................21 Tesco ............................................................6 Warsaw Chopin Airport ............................11 Warsaw Stock Exchange ..........................15 X-Trade Brokers ........................................20

NEWS

JUNE 10-16, 2013

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International

Kopacz discusses bilateral relations in China Poland’s parliamentary speaker visited China in an effort to further boost growing ties between Poland and the world’s second-largest economy

Human rights?

COURTESY OF SEJM.GOV.PL

Sejm Speaker Ewa Kopacz visited China last week, where she held talks with the country’s top legislator Zhang Dejiang. The two discussed enhanced bilateral parliamentary cooperation, while Ms Kopacz also proposed the opening up of a Polish-China dialogue on human rights.

Mr Zhang hailed the development of his country’s ties with Poland in the 60-plus years since the countries established diplomatic relations, and especially since they forged a strategic partnership in 2011 during a visit to China

by Polish President Bronis∏aw Komorowski.

“The Chinese side always cherishes its traditional friendship with Poland and looks forward to more practical

ship is in the interests of both the Chinese and the Poles.

Ewa Kopacz (first from left) during a meeting with Chinese officials cooperation between the two sides,” Mr Zhang said.

As both China and Poland “give priority to economic development and people’s living conditions, the two legislatures can also work together to provide more favorable legal

ship between the two countries.

Meanwhile, Ms Kopacz said Poland attaches “great significance” to its relationship with China and believes that the establishment and development of the strategic partner-

environments for economic cooperation and people-topeople exchanges,” he added.

Mr Zhang said China’s parliament had set up a body to strengthen ties between the two legislatures and further enhance the strategic partner-

Ms Kopacz’s visit created controversy in Poland as it occured during the anniversaries of the Tiananmen Square Massacre in China and the first partially democratic elections in post-communist Poland, both of which occurred on June 4, 1989.

Some of Poland’s political parties refused to send representatives as delegates in protest.

But Ms Kopacz later told Polish Radio that during her meeting with Mr Zhang and Chinese Vice President Li Yuanchao, she brought up the issue of human rights in China.

“Since we are joined by a strategic pact, we can speak sincerely even about difficult issues. We are maintaining our readiness to initiate bilateral mechanisms for consultations on social dialogue and human rights,” said Ms Kopacz. “[Mr Zhang] said he supports the initiative,” she added.

Remi Adekoya

International

Poland to import US shale gas?

Poland is interested in importing natural gas from the United States, Polish Foreign Minister Rados∏aw Sikorski said during his visit to Washington, DC last week. Mr Sikorski met with US Energy Secretary Ernest Moniz to discuss the possibility.

Poland plans to complete construction on a liquefied natural gas (LNG) terminal in the northwestern city of ÂwinoujÊcie next year. After the meeting, Mr Sikorski said that imports to the terminal would allow for Poland to buy gas at more competitive prices.

Gas El Dorado In recent years, thanks to technological developments that allow for the extraction of gas trapped in shale rock, the US has become the world’s largest producer of natural gas. As a result, the fuel has become much cheaper in the US than in other countries. A thousand cubic feet of natural gas costs $3-$4 in the US, while in Europe the same amount costs around $12.

Over 70 percent of the gas Poland consumes is imported from Russia, and a few months ago Polish state-controlled gas firm PGNiG renegotiated a deal with Gazprom to reduce the price of the gas it buys from the Russian state-owned giant by some 15 percent. Nevertheless, Poland would like to further reduce its dependence on Russian gas.

As part of its diversification efforts, Poland signed a deal with Qatargas for the import of 1 billion cubic meters of LNG a year back in 2009.

However, Qatar links its gas prices to oil prices, which have decreased significantly since the deal was signed. In November last year, Miko∏aj Budzanowski, who was Poland’s treasury minister at the time, said that Poland wanted to renegotiate the deal. However, no attempt to do so has been made thus far.

Wishful thinking?

Poland could therefore profit greatly from cheap natural gas imports from the US. But there are some significant stumbling blocks: US law allows for the export of gas only to countries with which it has a free-trade agreement.

That excludes Poland. The US and EU are currently working on a comprehensive free-trade agreement, but that deal, which will be complicated and huge in scale, will likely take years to hammer out.

Additionally, the US is hesitant to export its own gas, fearing it would push up prices in its domestic market. A January 2012 study by the of the Department of Energy concluded that increased US natural gas exports would lead to “higher domestic natural gas prices, increased domestic natural gas production, reduced domestic natural gas consumption, and increased natural gas imports from Canada via pipeline.” Out of a total of over 20 firms that have applied for permits to export natural gas, only two have been granted approval by the Department of Energy so far.

Nevertheless, Mr Sikorski said he hopes that imports to Poland could begin as soon as 2016.

Poland still has a long way to go before it will be able to use shale gas from its own deposits.

Mr Sikorski explained that the legal and exploration processes “will certainly last a number of years,”

before Poland’s shale gas will be available for commercial use. He added that in the US, shale-gas extraction has been

ongoing for over 20 years, while in Poland the process began just two years ago.

Jacek Ciesnowski

Law and Justice MP leaves party Przemys∏aw Wipler announced that he was leaving opposition party Law and Justice. He said he would launch a new political association, Republikanie (the Republicans). Mr Wipler said that his economic views were not in line with what Law and Justice is proposing. Mr Wipler was known for his economically liberal views.

LOT to ask Boeing for compensation LOT Polish Airlines, Japan Airlines, All Nippon Airways and Ethiopian Airlines will ask aircraft producer Boeing for compensation after the company’s 787 Dreamliner planes remained grounded for months due to battery problems, the Polish Press Agency reported. LOT will start talks with Boeing in June.

Polish teams win US Mars rover competition Teams from Polish universities won the two top prizes at the University Rover Challenge in Utah, a competition that involves designing and building Mars rovers that could be used for exploring the planet in the future. The Hyperion Team from the Bia∏ystok University of Technology took home the first prize, while the Scorpio 3 team from the Wroc∏aw University of Technology came in second.

FC Barcelona to start preseason in Gdaƒsk

COURTESY OF POLSKIELNG.PL

In the search for cheaper energy, Poland looks across the Atlantic

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Construction on the LNG terminal in ÂwinoujÊcie continues. It is expected to open next year

Spanish soccer champions Barcelona will play Lechia Gdaƒsk on July 20 at PGE Arena in Gdaƒsk. The match will be the first of five preseason games for the Spanish side. Ticket prices start at z∏.95 for family passes and z∏.200 for single tickets. Polish organizers stipulated that if the match is played without an appearance by Argentinian Lionel Messi, whom many consider the best player in the world, they will pay 30 percent less of the contracted fee, rumored to be in the range of €2 million. ●

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NEWS

www.wbj.pl

JUNE 10-16, 2013

International relations

Kerry: US wants Poland in Visa Waiver Program During Polish Foreign Minister Rados∏aw Sikorski’s trip to Washington, DC last week, US Secretary of State John Kerry said that the United States would like Poland to be part of the Visa Waiver Program (VWP). Poland’s exclusion from the program has been a major sticking point between the countries in recent years. Since the country is not part of the VWP, Polish citizens still need to gain a visa to enter the US, which entails paying high fees and lining up at the US embassy or its consulates to undergo what some consider

to be humiliating interviews – all just to visit relatives or go on vacation.

“We also want to see Poland included in the Visa Waiver Program,” said Mr Kerry at a joint press conference with Mr Sikorski.

“Making it easier for Poles to visit the United States makes sense in every respect,” he added. “It’s good for trade, it’s good for investment, it’s good for promoting the people-to-people ties that help to bind our countries together.

And we’re going to continue to work with Congress in order to achieve the goal of this visa waiver program.”

Most citizens of countries in the program are not required to hold visas to enter the United States. Poland,

Bulgaria and Romania are the only EU countries not to be a part of the program. The exclusion riles Warsaw particularly since it has been an unwavering US ally, and was one of the strongest international backers for US military operations in Afghanistan and Iraq.

“Thank you for your words about the Visa Waiver Program,” said Foreign Minister Sikorski. “It’s become a symbolic but also a practical issue, and I will be delighted if President Obama’s promise to us to fix it by the end of his tenure is fulfilled.”

When Polish President Bronis∏aw Komorowski visited the US in 2010, US President Barack Obama promised to end Poland’s exclusion

from the VWP by the end of his time in office. President Obama’s second and final term as US president ends on January 20, 2017.

Poland has been excluded from the VWP because it does not meet its requirements, specifically, a visarefusal rate of less than 3 percent. There have been several legislative attempts in the US to change this requirement so that Poland could be included, but so far none have been successful. Earlier this year, a bill for the Jobs Originating through Launching Travel (JOLT) Act was submitted to Congress. The bill contains elements that could pave the way for visa-free travel for Polish citizens.

COURTESY OF THE US DEPT OF STATE/FLICKR

But will the Secretary of State’s comments translate into concrete action?

Polish Foreign Minister Rados∏aw Sikorski (left) and US Secretary of State John Kerry at a press conference in Washington, DC last week

Andrew Kureth

Europe

EC endorses Latvia for euro zone entry Latvia received official endorsement from the European Commission to join the euro zone last Wednesday.

Review and endorsement from European Parliament and EU political leaders are required for the final approval of Latvia’s application, a process likely to be completed in July. After that, Latvia would join the euro zone on January 1, 2014, becoming the 18th country to adopt the currency.

According to the EC and the European Central Bank, Latvia has met the financial and legal requirements for membership.

Latvia, with 2.2. million people and an economic output about €20 billion in 2012,

SHUTTERSTOCK

The Baltic state will become the 18th EU member to adopt the common currency

The Latvian parliament building, Riga is often seen as a success story of austerity measures. After cutting government spending

in the aftermath of the 2008 financial crisis, its economy has managed to stabilize and

achieved 1.2 percent growth in the first quarter of 2013, one of the highest in the EU. Some

European leaders, including EU Commissioner for Economic and Monetary Affairs Olli Rehn, regard Latvia’s desire to adopt the euro as a sign of confidence in the common currency.

However, joining the euro zone is still a controversial move domestically. Recent opinion polls show that about two-thirds of the country’s population opposes euro zone membership. That about half of the deposits in Latvian banks come from foreign countries, primarily Russia, is another reason for concern.

Despite these issues, Latvia’s historically conservative financial policy, akin to that of Germany, Finland and other Northern European countries, may be helpful for its future in the euro zone.

Pawe∏ Tokarski, an analyst on political economy of the European integration at Polish

Institute of International Affairs, says that Latvia joining the euro zone is more a political decision than an economic one.

Latvia “wants to be part of the decision-making core in the EU,” and “that core is in the euro zone,” he said. But there is an advantage for euro zone countries as well: “Latvia’s membership is a clear message to international investors that they can have confidence in the common currency,” said Mr Tokarski.

On the economic side, he thinks “there is still a lot of uncertainty on the south periphery of the euro zone,” and “a small economy like Latvia’s can have some clear economic profits, but there are still some doubts about sustainability of the Latvia’s economic model and the performance of its banking sector,” he said.

Cathy Liu

Region

In Poland, the Lower Silesia and Ma∏opolskie voivodships have been worst affected Since the beginning of June, Polish firefighters have had to deal with over 6,000 instances of damage caused by floods.

Most of the incidents were not serious: they included fallen trees obstructing roads, flooded basements and damaged roofs.

After days of continuous rainfall, water levels in many Polish rivers exceeded alert

levels, causing local authorities to issue flood warnings. The worst flooding was seen in the Silesia, Lower Silesia, Lubuskie and Podkarpackie voivodships.

Luckily for Poland, there were no casualties, and the property damage was relatively insignificant. Some Polish companies were affected, however. Chemical producer Synthos had to suspend production at three of its plants located in the Czech Republic due to the risk that a pump station on the nearby Vltava River could become flooded.

Poland’s largest insurer,

PZU, saw its shares drop by 4 percent last week, as investors worried that it would have to pay out large compensation packages to households damaged by floods.

Still, the situation in Poland was relatively calm compared to other countries in the region. The Danube, Elbe and Vltava rivers in Germany and the Czech Republic reached levels unseen in hundreds of years.

The Bavarian city of Passau saw its worst flooding since 1501. As of press time, 19 people had died and numerous others had been reported

missing throughout the entire region.

However, Polish authorities have said that there is relatively little danger that those countries’ flood waters could threaten Poland. The water from the Czech Republic will most likely flow towards the North Sea, Rafa∏ Bàkowski from the Institute of Meteorology and Water Management told Rzeczpospolita.

Environment Minister Marcin Korolec told news agency IAR that Poland is prepared in terms of infrastructure.

Jacek Ciesnowski

SHUTTERSTOCK

Floods hit hard in Central Europe, Poland

The famous Charles Bridge on the Vltava River in Prague was closed due to the high water levels

BUSINESS

JUNE 10-16, 2013

Foreign investment

Poland a European leader in FDI job creation No other country saw such high levels of growth in the number of FDI-related jobs created In 2012, Poland outpaced Russia to become the top destination for FDI projects in the CEE region and seventh in Europe overall, according to an Ernst & Young survey.

Poland attracted 22.3 percent more FDI projects than it did the previous year, the report found.

With 13,111 jobs created via FDI, up 67.3 percent yearon-year, Poland ranked third in terms of job creation for the whole of Europe last year (after the UK and Russia), up from seventh place in 2011.

No other country experienced such growth levels in the number of FDI-related jobs created.

US investments rose sharply, notably in services projects, while German companies increased their presence in the automotive and logistics sectors in Poland, Ernst & Young wrote in its report.

CEE comeback

2011. But the number of jobs created increased by 8 percent.

Despite its ongoing economic troubles, 37 pecent of business leaders interviewed saw Western Europe as an attractive investment destination. That placed it second in the world after China, which was seen as attractive by 43 percent of the 808 respondents.

North America came in third, with 29 percent saying it was an attractive FDI destination, closely followed by CEE, which 28 percent of investors surveyed considered attractive. CEE was followed by Brazil (26 percent), Russia (20 percent) and India (19 percent).

“CEE has re-emerged as a leading location for manufacturing-oriented investment, capturing more than 50 percent of the jobs created.

Investors now tend to believe the region will overcome its economic troubles,” Ernst & Young wrote.

“Thanks to foreign multinationals, particularly in heavy industry and automotive activities, investment is increasing in the vastly improved and still cost-competitive Poland, the Czech Republic and Hungary,” the report stated.

More FDI jobs in Europe In total, 3,797 FDI projects were started in Europe in 2012, 2.8 pecent lower than in

Remi Adekoya

FDI by number of projects (2012)

FDI jobs created

UK

697

UK

30,311

Germany

624

Russia

13,356

France

471

Poland

13,111

Poland

148

Germany

12,508

Russia

128

France

10,542

Turkey

95

Turkey

10,146

Czech Republic

64

Czech Republic

5,508

Source: Ernst and Young

IBM to open service center in Katowice IT giant IBM will locate its second Poland-based service center in Katowice, creating up to 2,000 jobs in the region. “This year alone, 400 people will be hired there, overall by 2015, 2,000 employees in total should be working in the center when it becomes fully operational,” said Jakub Jarzàbek, a

spokesperson for Katowice city authorities.

“Katowice was selected for our next growth location due to its very strategic location,” IBM Poland & Baltics general manager Ales Bartunek added, emphasizing the city’s close proximity to Germany.

The Katowice center will be IBM’s second such facility

in Poland. The first is located in Wroc∏aw, in southwestern Poland. IBM has been present in Poland for over 20 years and has centers and laboratories in Gdaƒsk and Poznaƒ as well.

Katowice competed with Poznaƒ and ¸ódê in the selection process.

KW, JC

GTI Travel Polska halts business operations After German travel agency GTI Travel declared bankruptcy last Monday, on Tuesday its Polish unit decided to suspend sales and shut down its business.

The Polish company said it was looking for new flights for its clients since the carrier they were due to fly back on, Sky Airlines, a member of the Kayi Group which also includes GTI Travel, has also halted operations.

Kayi Group, which is active mostly in Germany, the Netherlands and Russia, has

been present in Poland since 1999. It is understood that Kayi Group has run into financial trouble.

According to the authorities of the Mazowieckie voivodship, there were 750 GTI Travel Polska customers on holiday abroad at the time the company filed for insolvency, with 538 of them due to return the day after the company made the announcement. As of press time local authorities, along with GTI insurer Signal Iduna, were working on getting the travel-

ers back home. Most were due to have arrived back in Poland by Monday, June 10.

GTI Polska has some z∏.7.25 million in insurance coverage, which will be used to get its customers on vacation back home and to pay out compensation to others whose trips have been canceled.

Monika Hajduk, GTI Travel Polska’s PR manager, said the company would file for bankruptcy sometime this week.

KW, JC

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BUSINESS

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JUNE 10-16, 2013

Interview

Tesco looks to e-sales to battle downturn in Poland Jacek Ciesnowski: Tesco has been operating in Poland for 15 years. How has the retail market changed since Tesco first opened its doors in the country?

Ryszard Tomaszewski: It has changed tremendously. When we started we had a huge display of movies and CDs. Nowadays we usually have only two shelves dedicated to that, because people are buying them online. The same goes for electronics; people don’t shop for TV sets at Tesco, they prefer to buy them elsewhere, either online or in electronics stores.

That creates a lot of free space in your stores That’s why we try new things.

Our F&F clothing line, which we plan to sell both in our stores as well as in separate shops, is a success. Last year we recorded double-digit growth in sales of that line, which we consider a success, considering the clothing sector is in recession.

We also plan to install food courts in all our biggest stores that operate under the “Tesco Extra” brand. We’ve just redeveloped the first hypermarket in Poland, built in Warsaw at ul. Górczewska in 1994. It has a clothing boutique and the biggest bistro so far in any Tesco store in

ORGANIZATOR

Poland. We’ll treat it as an experiment, we’ll wait six months, see what the customers’ reaction is and then, if it is successful, we’ll implement these changes in our other “Extra” stores.

People come to our stores hungry and we would like to take advantage of that by offering them cooked meals.

Our stores are visited by five million people per week.

That’s potentially a huge source of revenue.

Has the downturn in Poland’s economy hit your results?

Yes, definitely. Retail is down.

I don’t have the exact figures, but each month it’s worse and worse.

Do you expect a rebound in the second half of this year?

No, not really. I don’t see any reason for that. Unemployment is high, wages aren’t getting higher, production is down, so I don’t see any economic trends that could change.

What are your expectations regarding retail sales for the whole of 2013?

I think we should be happy if we manage to stay at the same level as last year. Unfortunately it might not be that good, and I wouldn’t be surprised if it was down.

So what is your plan to fight the downturn?

We need to meet our customers’ needs. That’s why we’re changing our stores, renovating them and expanding stock. We are really counting on our internet sales as well. In the UK internet sales amount to about 5-6 percent of total sales and in the rest of Europe the share is even lower, about 2-3 percent. I really think that Poland has bigger potential than that. I estimate that in the next few years, our internet sales could exceed 10 percent.

Who do you consider your biggest competition?

Poland’s retail trade is increasingly being shaped by discount chains. I don’t like that trend. I think it hurts the market. In those stores you can usually buy two kinds of each product, two brands of oil, two brands of flour, etc. That’s not good for anyone – neither the customers nor the producers.

So what’s your plan to fight the competition? Open more stores?

On the contrary. We don’t want to open more hypermarkets except in cities where there isn’t one of our own yet.

We plan to focus on smaller stores and sales via internet.

We estimate that 80 percent of Poles are able to buy in Tesco stores currently, either directly in one of our shops or online. That’s a good result.

We don’t need to fight discount retail chains by opening more stores. That’s not a solu-

sp ONs ORZy I pARTNeRZy

COURTESY OF TESCO

Ryszard Tomaszewski, president of Tesco in Poland, spoke with WBJ about the retail market in the country, how the firm plans to increase sales, and where its biggest competition is coming from

Mr Tomaszewski says the increasing number of discount stores is “hurting” the market tion. On the other hand, I don’t see discount chains selling their products online. If they have a store on every corner, why would they open an online one?

Tesco also exports Polish products. Last year it exported goods worth some z∏.1.7 billion to the UK alone. Are you planning to export Polish

products to other countries as well?

We are part of a global brand that’s present in many countries across the globe. We can use this advantage to sell Polish products to different markets.

The UK market is an obvious one, as there is a huge Polish population there that wants to buy Polish products. Recently we sent a few crates of Polish

products to China and it looks like they were popular. Mostly sweets, cookies, but we’ve sent Polish beer as well. It’s a start.

Polish products are also available in Tesco stores in the Czech Republic, Slovakia and Hungary. But we don’t see ourselves as exporters, we just make use of the fact that we are part of a worldwide company. ●

FINANCE & ECONOMICS

JUNE 10-16, 2013

www.wbj.pl

7

Interest rates

Manufacturing

No surprise: RPP cuts main rate to 2.75%

Poland’s manufacturing PMI rises

Lower than ever The National Bank of Poland’s reference interest rate, June 2011-June 2013 Source: The National Bank of Poland

5.0 4.5 4.0 3.5

2.5

Jun. ’11 Jul. ’11 Aug. ’11 Sep. ’11 Oct. ’11 Nov. ’11 Dec. ’11 Jan. ’12 Feb. ’12 Mar. ’12 Apr. ’12 May ’12 Jun. ’12 Jul. ’12 Aug. ’12 Sep. ’12 Oct. ’12 Nov. ’12 Dec. ’12 Jan. ’13 Feb. ’13 Mar. ’13 Apr. ’13 May ’13 Jun. ’13

3.0

Emphasizing the need for stronger growth, Mr Belka said, “In Q1 there was 0.5 percent year-on-year growth and if there is growth of 0.4 or 0.6 percent in Q2, then we’d need a microscope to see it as revival [of the economy].”

RPP member Anna Zieliƒska-G∏´bocka pointed out that much depends on whether economies of the euro zone pick up. “Our decisions bring effects, there is transmission of the monetary policy onto the market, which is not always visible in the euro zone,” she said.

“It is however yet unknown if a significant improvement will come after two or three quarters, a lot depends on economic processes [in the euro zone],” she added.

“It would be an over-interpretation to say the easing cycle has ended,” Mr Belka said.

“The cycle is coming to an end, but we’re not there yet. We are close to an interest rate level that the majority of policy makers would regard as adequate.”

Most analysts expect another 25 bp cut in July, and are split as to whether more will come later this year.

Poland’s Purchasing Managers’ Index for the manufacturing sector rose to 48.0 points in May from 46.9 in April, indicating that the downturn in the industry has eased somewhat.

The figures just barely beat market forecasts of 47.8 points.

A reading of under 50 points indicates contraction in the sector, and May was the 14th month in a row to see decline.

However, new orders, output, and employment all fell at slower rates than the previous month, according to Markit Economics and HSBC, which prepared the report.

“Central to the overall deterioration in business conditions

overall reading has been “as positive as it gets in terms of PMI readings from Poland for over a year now.”

“It then falls well short of providing any meaningful sign of the economic slowdown bottoming out – an assumption the authorities (central bank, ministry of finance) still work with. That argues for more policy stimulus to come through,” she added.

“With headline CPI already undershooting the central bank target we expect the central bank to continue cutting rates ... and now look for the policy rate to bottom at 2.25% by Sep-13.”

The Monetary Policy Council cut Poland’s main interest rate by 25 basis points to 2.75 percent last Wednesday (see accompanying story).

Andrew Kureth

Making a comeback?

Poland’s manufacturing PMI reading, May 2011-May 2013 55 53 *A reading above 50 indicates expansion, below 50 indicates contraction

51 49 47 45

y ’1 Jun 1 . ’1 1 Jul . ’1 1 Au g. ’1 Se 1 p. ’1 Oc 1 t. ’ 1 No 1 v. ’ De 11 c. ’1 Jan 1 . ’1 Feb 2 . ’1 Ma 2 r. ’ 1 Ap 2 r. ’ 12 Ma y ’1 Jun 2 . ’1 2 Jul . ’1 2 Au g. ’1 Se 2 p. ’1 Oc 2 t. ’ 1 No 2 v. ’ 1 De 2 c. ’1 Jan 2 . ’1 Feb 3 . ’1 Ma 3 r. ’ 1 Ap 3 r. ’ 1 Ma 3 y ’1 3

Poland’s Monetary Policy Council (RPP) cut Poland’s benchmark interest rate by 25 basis points to 2.75 percent.

The new rate is yet another record low (the two previous rates had also been record lows). The RPP has now cut a full two percentage points off its main rate since November last year.

Most analysts had expected the cut, with a full 38 of 40 economists polled by Bloomberg saying they thought the council

would cut rates by 25 basis points (one thought there would be no cut and the other expected a cut of 50 basis points).

In a statement released after the sitting, the RPP pointed to weaker-than-expected economic growth in Poland and a stronger-than-forecast decline in inflation as important reasons for the cut.

“We hope that the economic situation does not get worse,” National Bank of Poland President Marek Belka said at a press conference last Wednesday afternoon. He added that there are no signals of a significant rebound, but risks are not accumulating either.

facing Polish manufacturers was a further drop in new orders.

The volume of new business received has declined every month since February 2012, the third-longest sequence of contraction in the survey history.

The rate of decline slowed during the month, however, to the weakest in 2013 so far,” the report read.

The report also emphasized that purchasing managers were buying supply at lower prices for the fifth successive month – a tie for the longest such streak in 11 years – indicating weak demand. Delivery times quickened to the greatest extent in four years.

Agata Urbaƒska, an economist for Central & Eastern Europe at HSBC, said the lower rate of decline in the

Ma

A new all-time low, but the cut was expected as macroeconomic figures continue to disappoint

The sector is still suffering decline, but that seems to be easing

Andrew Kureth

Source: Markit Economics, HSBC

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8

INTERVIEW

www.wbj.pl

JUNE 10-16, 2013

International

New Georgian government focuses on pragmatism WBJ sat down with the chairman of Georgia’s parliament, David Usupashvili, to discuss his country’s EU and NATO aspirations, the buildup of Russian troops on Georgian territory and post-Soviet geopolitics. He also responded to allegations that the government is cracking down on the opposition party to the thousands of complaints made against former officials, including bribery and corruption or depriving people of their private property, then the opposition starts crying that it is being oppressed and uses phrases like “selective justice” and all that.

When we ask what happened to the millions of dollars that the previous, Saakashvililed, government held in secret accounts that were open to no scrutiny, they cry “political persecution.” That money was paid into secret accounts by our local governments all over the country. Do you know how much were in those accounts?

Roughly $300 million. So is asking what that money was

“After the so-called Rose Revolution in 2003 when Saakashvili took over, the West became convinced that the ‘right people’ were in power in Georgia.”

COURTESY OF THE OFFICE OF DAVID USUPASHVILI

Remi Adekoya: Georgia’s President Mikheil Saakashvili and his opposition United National Movement party accuse the current Georgian government, led by Prime Minister Bidzina Ivanishvili, of practicing selective justice against the opposition. How do you respond?

David Usupashvili: First of all, let us remember that this socalled opposition was the ruling party just a while ago. And in the best of traditions in the post-Soviet states, when a ruling party changes so does the composition of public administration. Heads of ministerial departments, police chiefs and the other administrative officials are all replaced.

But when we try to respond

INTERVIEW

JUNE 10-16, 2013

www.wbj.pl

9

“We do not want to be a tool used to fight proxy wars between the great powers.”

How would you describe the culture of democracy in Georgia today then?

We are aware that Georgia lacks a culture of democracy, a culture of independent institutions and courts and a free press. That is why our government has invited foreign observers to come and see how our courts and institutions function and then to advise us on how to improve them.

After the so-called Rose Revolution in 2003 when Saakashvili took over, the West became convinced that the “right people” were in power in Georgia and therefore, nothing more needed to be done. That was unfortunate. Today, we welcome all experts and observers who can help us improve the way our country functions. We need them.

What about relations with Russia, which invaded Georgia in 2008? Your government has issued a new foreign policy directive that obviously aims to diffuse some of the tensions with Moscow.

Yes, we are interested in Georgia’s strategic interests in the region. We do not want to be a tool used to fight proxy wars between the great powers. We are already squeezed in between many geopolitical structures and interests.

We learned a big lesson in 2008. Despite the fact that we had been officially invited to join NATO at the Bucharest summit that year, when Russia attacked us, much to Saakashvili’s surprise, NATO did not come to our rescue.

And those same Western coun-

tries today still have relations with Russia and cooperate with [Moscow]. I have not noticed any Western nation cooling its relations with Russia because it attacked Georgia in 2008.

We are more pragmatic than our predecessors in this regard. We know irritating Russia makes it more difficult for our Western allies to talk to Moscow on our behalf. Of course, right now there is no possibility to reopen diplomatic ties with Russia, but we are open to testing diplomatic options that could improve the situation in the foreseeable future. Poland is one of the countries involved in this process.

This seems a marked change from the policies of the previous government, is it not?

We tried fighting with Russia but that didn’t work out for us very well. The result is that right now, Russia is building up its military bases on Georgian territory. There are now five times more Russian soldiers on Georgian soil than there were before the war. Russia currently occupies more than 20 percent of Georgia’s territory presummer 2008. And it will be hard to get rid of them. Once they come, it’s hard to get them to leave.

What about the Association Agreement Georgia is trying to sign with the European Union? Any progress on that front?

Great progress. The EU is not an end in itself but a means to an end. The ultimate goal is prosperity for our people so we tell our EU colleagues that even if there are delays regarding our closer integration with Europe, we will still continue to implement changes the EU requires of us for our own good and for the good of our people.

The opposition agrees with us on this. Adopting best practice methods from the EU is a strategic goal of Georgia’s. Last October, we had the first peaceful handover of power in Georgia since the collapse of communism. We think our Western friends should also acknowledge that achievement.

So no difference with the previous government here?

In principle yes, but we are less ambitious. Saakashvili used to lecture the EU on how Europe should be run. We believe we first have to get our own house in order before we have the moral, intellectual and political

status to start giving Europe advice.

Also, we don’t talk about Georgia being the new Berlin Wall and other such rhetoric which the previous government thought would make people notice us in Europe. First, we need to build institutions in our country and then we can bring more to the table in discussions with the EU. What kind of economic strides has Georgia made in recent years?

When Saakashvili took power in 2003, some 99.5 percent of the population was living in hardship. He reduced that figure to 93-95 percent. Still only a tiny minority had access to quality health care and education. There were maybe two or three modern hospitals in the whole country. Over 50 percent of the population was jobless.

We have only now introduced nationwide health insurance for everyone.

Where will the money come from to improve things for ordinary Georgians?

First of all, we were able to find $1 billion in our budget that had earlier been designated for yet another of Saakashvili’s megalomaniac projects. We used part of the money to create a special fund for farmers who had previously been left to fend for themselves completely.

Secondly, we want to encourage foreign investment in our country. The previous government would basically dictate to investors where they should build hotels so as to be able to say “oh look, there is progress in our country.”

But many of these projects were improperly located and thus never had any chance of being profitable. This means they created no jobs, but were just wasted money. However, the investors were left without much choice because the government threatened to deprive them of lucrative government contracts if they did not comply.

However, we believe it is not the government’s role to tell investors where to build hotels. They will now have the freedom to do as they see fit for their businesses. Thirdly, due to its geographic location, Georgia could be a good transport link by road or rail, a transit point. We also have potential in the area of tourism and are working on creating the infrastructure needed to build that industry. ●

COURTESY OF THE OFFICE OF DAVID USUPASHVILI

used for an attack on someone’s human rights? They are simply not used to having to answer questions from civil society.

There was an MP for example who owned land on the spot where Saakashvili had decided he wanted to build his latest presidential palace. The man was approached and asked to hand over the land for free as his patriotic duty! When he started complaining in the media, he was brutally attacked by masked men in broad daylight and nearly beaten to death. Today it is metal screws holding his face together.

Some time ago, Saakashvili decided to build a new lavish parliament that has already gobbled up $200 million and would take another $20 million to finish – in a city three hours’ drive from the capital Tbilisi.

What for?

Karpielówka Restaurant Our name comes from an area in Zakopane, and in our restaurant you can feel the air and the atmosphere of the Tatra Mountains.

With our original highlander décor and the climate of an outlaw’s cottage, it’s the perfect place to dine on traditional dishes including our specials: dumplings, knuckle baked with onion, dishes with oscypek cheese and much more.

We can organize wedding dinners, conferences and banquets, as well as picnics with BBQ and bonfire. Check our lunch menu, our delivery service and catering options. ul. Indiry Gandhi 11, tel. 22 644 85 10 | Imielin Metro Station, close to Multikino; City Hall Ursynów; 5 minute walk towards St. Thomas the Apostle Church Open 12:00-last guest. | Reservations: +48 22-644-85-10 or karpielowka@home.pl www.karpielowka.com.pl | Check our Facebook page

10

OPINION & ANALYSIS

www.wbj.pl

JUNE 10-16, 2013

The world through Putin’s eyes Robert D. Kaplan

F

ew people comprehend Russia’s vulnerabilities like its leader, Vladimir Putin. He must try to govern a country that extends through nearly half the longitudes of the earth but that has fewer people than Bangladesh.

What’s more, Russia’s population is declining, not increasing. All the Arctic seas to Russia’s north are iceblocked many months of the year, so with the exception of its Far East, Russia is essentially a landlocked nation. Moreover, Russia’s flat topography affords little natural protection and is therefore bereft of natural borders. Land powers, as they have no seas to protect them, are more insecure than island nations and continents like the United States and Great Britain.

But Russia is particularly insecure.

Mr Putin knows that it hasn’t been just the French and the Germans who have invaded Russia from the west in centuries past, but Swedes, Poles, and Lithuanians, too.

So he must seek a buffer zone in

over former Warsaw Pact states. But he is nervous. Countries by the Baltic Sea are building or planning to build regasification plants that will allow them to import natural gas in liquid form from other parts of the world, thereby undermining Russia’s energy monopoly in Eastern Europe. Then there are the shale gas deposits in Poland and Ukraine that might further increase the energy options of those geopolitical bellwether countries. Mr Putin needs to be a worrier.

American journalists, politicians and government officials must drive Mr Putin to distraction. They assault him on moral grounds. After all, “He is a dictator!” they say. “He tolerates and even encourages corruption and rampant thuggery!”

“But do they know I am dealing with Russia – not with the United States?” Mr Putin must think. “Are they aware that when I took power there was political chaos and criminal anarchy, with ordinary Russians robbed of their dignity?” In Mr Putin’s mind, he restored a large measure of order – without which no

negotiate with Mao Zedong because it was in America’s interest to do so; the fact that Mao had just killed millions in the Great Proletarian Cultural Revolution was not an overriding detail. “So where is my Nixon?” Mr Putin must think. “After all, I have not killed millions like Mao. I have not even murdered thousands.”

In 1972, the American media praised Mr Nixon for going to China and negotiating with a mass murderer. Now the same media would not let President Barack Obama go to Moscow to negotiate with a normal autocrat unless he delivers scolding lectures on human rights. Mr Putin must have smiled to himself cynically for a moment at the Boston Marathon bombing, whose perpetrators had origins in the Russian Caucasus – a rough and tumble Muslim land Russia has been trying to subdue for generations. “If only the Americans realized their eternal interests in an advantageous Eurasian balance of power and helped me permanently crush the north Caucasus.”

“Mr Putin knows that Russia cannot rule Eastern Europe.”

Eastern Europe; Russian history demands no less of him. This is not the recreation of the Warsaw Pact we are talking about. For the need to economically support disparate states in Eastern Europe for half a century was a burden that helped topple the Soviet Union. Mr Putin knows, therefore, that Russia cannot rule Eastern Europe. But he does require a degree of diplomatic and economic acquiescence in order to keep countries like Poland and Romania hobbled. Given that such countries are members of NATO and the European Union, this is a constant – perhaps impossible – challenge.

Economic leverage Mr Putin is happy that Russia’s geography grants him access to massive natural gas deposits, as well as the pathways to export that natural gas to Europe, particularly to Eastern Europe. This provides him with economic and, thus, political leverage

progress is possible in the first place.

And whatever his numerous faults, he is painfully aware that he is not in total control. Like many a Russian leader throughout history, he gives orders and in the vastness of the farflung provinces there is little response. The Communists required totalitarianism to exercise real control. But he is no mass murderer like Stalin; he is not relocating whole populations to Siberia. He is just a ruler with strong autocratic tendencies, something common to Russia.

“What do the Americans want of me! Why do they interfere with my domestic affairs through the support of these human rights organizations?

And, by the way, don’t the Americans realize that toppling Bashar alAssad in Syria might mean a worse human rights situation there; not a better one?”

Mr Putin wants a discussion with the Americans based on geopolitical interests, not values. President Richard Nixon went to China to

China is also a problem for Mr Putin.

Yes, he welcomes the new Chinese leader, Xi Jinping, on an official visit to Moscow, and the two feel a strong bond, as any two autocrats naturally would, faced as they are with lectures and demands from the democratic powers of the West. But geography dictates that Russia’s alliance with China is mainly tactical. While Russia is delivering increasing amounts of oil (and probably natural gas soon, too) to China, something for which Beijing is grateful, the two giant nations share long borders in the Far East and in Central Asia that through the centuries have been volatile.

The Russian Far East, an area roughly twice the size of Europe, has a paltry population of fewer than seven million that may fall to fewer than five million in coming decades.

Russia had expanded into this region in the 19th century and early 20th century during a fit of nationalistic imperialism when China was comparatively weak. That era is past, and on the other side of the border Russia faces a population of 100 million people in Chinese Manchuria.

Resource acquisition is the principal goal of Chinese foreign policy, and the Russian Far East is rich in reserves of natural gas, oil, timber, diamonds and gold. Unless China itself implodes – a possibility but not a probability – China must be seen as

SHUTTERSTOCK

The China problem

Vladimir Putin a long-range threat to Russia.

In Central Asia, meanwhile, besides building oil and natural gas pipelines from Kazakhstan and Turkmenistan into western China, Beijing has invested billions to mine copper in Afghanistan and has invested in oil exploration there, too. The Chinese have also won concessions to mine gold in Kyrgyzstan and Tajikistan. Beijing is attempting to build a rail system that will link Kyrgyzstan, Kazakhstan and Uzbekistan with China. For Mr Putin, who must try to establish a buffer zone in former Soviet Central Asia of the kind he is trying to establish in Eastern Europe, China must be seen as a rival, to say the least.

So once again, we return to the question: where is Mr Putin’s Nixon?

President Nixon would understand Russia’s geopolitical insecurities and partially assuage them, in order to gain some leverage over China, just as four decades ago he had moved closer to China in order to gain some leverage over Russia.

Were the United States to give Russia more leeway in the Caucasus and Central Asia – rather than trying to compete with Russia in those

regions – Russia might find ingenious ways to make China more nervous along its land borders. And that, in turn, would make China somewhat less able to devote so much of its energy to projecting power in the Pacific Basin, where it threatens American allies. None of this would remotely fall into the category of aggressive or irresponsible international behavior, mind you. Trying to adjust the global balance of power in one’s favor is a perennial goal of statesmanship.

But even if President Obama intellectually realizes such truths and opportunities, the public policy climate in the United States is not that of the Cold War, which would have allowed for a broader dynamic between Washington and Moscow to each side’s mutual benefit. The result is that China profits, to the endless frustration of Vladimir Putin. As for the United States, it gains little advantage in the outcome. ● Robert D. Kaplan is chief geopolitical analyst for Stratfor.

Republished with permission.

Stratfor.com

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JUNE 10-16, 2013

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11

The economics of airport security – the case of Poland

Lars Christensen

I

a private company rather than government employees (remember, they actually smiled …).

A nice surprise Friendly, well-dressed and efficient.

Gone were the scary-looking but lazy militia-type people. That indeed was a nice surprise.

Over the years I have given a lot of thought to exactly what we can learn about airport security and I for many years have had a theory that countries that have military-style airport security and where the security staff generally see passages as “animals” who are a potential threat to security, rather than clients that should be served are also countries where government regulation is excessive in other areas of economic life.

Hence, my theory is that if you meet an unfriendly bureaucrat at the security check in the airport then it is also very likely it will be hard to start a business in that country. Therefore, I tend to think of airport security as

COURTESY OF CHOPIN AIRPORT

am writing this sitting in Warsaw’s Chopin Airport. Over the last decade I have spent more time in Chopin than in any other airport in the world. The airport has changed a lot over the years and its development in many ways seems to have tracked the development in the rest of the Polish economy.

In many ways one can say that airports are reflections of the countries in which they are located. Airports tell stories of economic, social and cultural development.

Today I got a very pleasant surprise when I arrived at the airport. A surprise that fundamentally makes me quite a bit more optimistic about Poland’s long-run growth perspectives.

So what has changed at Chopin Airport? Well, it is simple, but in my view quite important – airport security has changed. Until recently and as far back as I can remember (more than a decade), the staff taking care of the security check at Chopin Airport had been uniformed militia-style

Chopin Airport in Warsaw personnel in combat-style outfits armed with guns.

These people have never seemed especially concerned about seeing their jobs as a service to clients at the airport. Rather they generally never smiled and in general were quite inefficient in getting people through the

airport security check.

Today, however, I was not met by armed military-style people, but instead by polite and a lot more efficient staff dressed in normal clothes – and nice orange ties. They looked like the personnel in Scandinavian airports. I guess they are personnel of

an indicator of the level of government regulation of the country’s economy. This is something that makes me terribly bearish on the US’s long-term growth prospects every time I encounter a TSA official in a US airport – and makes me terribly depressed about the prospects for Ukraine and it gives me an understanding of why the Scandinavian countries “work” well, despite excessively large public sectors.

It was therefore a pleasure today to meet friendly and efficient people at the security check in Chopin Airport. And if my theory has any value, this is an indication that Poland has “matured” and the level of regulation is luckily getting lighter. That is good news. ● Lars Christensen is Danske Bank’s chief economist for emerging markets.

This opinion was originally posted on his blog, Market Monetarist (marketmonetarist.com). It has been republished with permission of the author.

W

ith Swedish cities roiled for weeks now by rioting by unemployed immigrants, many observers see a failure of the country’s economic model. They are wrong. The Swedish/Scandinavian model that has emerged over the last 20 years has provided the only viable route to sustained growth that Europe has seen in decades.

Changing perceptions Europeans should remember that perceptions of strength and weakness change fast. In the 1980s, Scandinavian countries stood for chronic

“The Scandinavian model that has emerged over the last 20 years has provided the only viable route to sustained growth that Europe has seen in decades.” budget deficits, high inflation, and repeated devaluations. In 1999, The Economist labeled Germany “the sick man of the euro” – a monument of European sclerosis, with low growth and high unemployment.

Now, however, the specter of devaluation has disappeared from northern European countries. Budgets are close to balance, with less public expenditure and lower tax rates, while economic growth has recovered. The transformation of the old European welfare state started in northern Europe, and it is proceeding to most of the rest of the continent.

Today, it is difficult to imagine the mindset that prevailed before Margaret Thatcher came to power in the United Kingdom in 1979 and Ronald Reagan in the United States in 1981.

Ms Thatcher’s greatest achievement was the liberalization of the over-regulated British labor market, while Reagan turned the tide with his inaugural address: “In this present crisis, government is not the solution to our problem; government is the problem.” The moral superiority of high marginal income taxes suddenly waned. Free-market ideas took hold.

In northern Europe, the transformation of the welfare state started in Denmark in 1982. In deep financial crisis, traditionally social-democratic Denmark elected a conservative prime minister, Poul Schlüter, a jovial man with a bow tie. One of his first decisions was to peg the Danish krone to the Deutschmark to stop the inflation-devaluation cycle. The Danish peg – now to the euro – still holds.

Mr Schlüter’s second big decision was to deregulate the Danish economy, which now has the world’s largest number of enterprises per citizen.

But he left the country’s high taxes and welfare state in place.

In the early 1990s, Norway, Sweden, and Finland experienced a horrendous real-estate, banking, and currency crisis. Output fell and unemployment skyrocketed. In 1991, Swedish voters broke the reign of the Social Democrats, electing a coalition government under conservative Prime Minister Carl Bildt, who called his program “the only way.” Mr Bildt tried to follow Schlüter’s lead, but, in 1992, Sweden was forced to devalue – though his deregulation of markets did work well.

Sweden’s greatest achievement was a gradual cut of public spending by no less than one-fifth of GDP from 1993 to 2007. Meanwhile, Sweden’s public debt was reduced from 73 percent of GDP to 39 percent of GDP, while taxes have been cut repeatedly.

The Social Democrats returned to power in 1994, but they accepted Mr Bildt’s new fiscal policies, and even carried out a revolutionary pension reform in 1998 that properly tied benefits to payments.

In parallel with the Scandinavian crisis, communism collapsed in Eastern Europe in 1989 and in 1991 in the Baltic states. Poland’s first post-communist finance minister, Leszek Balcerowicz, showed an amazed world how communism could be abolished and a market economy built almost instantly. The rest of Central Europe and the Baltic states followed his lead.

Former Estonian Prime Minister Mart Laar was the most radical European reformer. Indeed, his ideas about taxation have revolutionized Europe. In 1994, he introduced a flat personal-income tax, a policy that most Eastern European countries have since adopted. In 1999, when Laar became Prime Minister again, he abolished the tax on corporate profit, which was harming entrepreneurship. As a consequence of the ensuing tax competition, corporatetax rates have fallen to 15-25 percent in most European countries.

More broadly, Estonia has revolutionized public finances. Since 1992, it has maintained a more-or-less balanced budget, with hardly any public debt. It slashed public expenditure and capped spending at 35 percent of GDP – the same level as in the United States.

Anders Åslund

SHUTTERSTOCK

Where Europe works

As free-market thinking has taken hold and similar reforms have proliferated, the social-welfare state is being transformed into a social-welfare society. Government spending remains large enough to guarantee reasonable public services and a social safety net. Reformers have exposed the public sector to competition, not least from private providers, rendering it more efficient.

Much in common The systematic reforms in the United Kingdom, Denmark, Sweden, Poland, and Estonia have much in common. First, all were caused by a profound crisis of the social-welfare state: falling output, rising unemployment, large budget deficits, inflation, and devaluation. Without severe crisis, no significant reform was likely.

Second, a change of government through elections prompted reforms and gave them democratic legitimacy.

Reform does not require a state of emergency, as is often argued.

Third, reforms require a strong

leader. No major reform has been undertaken through consensus, though successful reforms usually generate a broad consensus a few years later. At that point, reforms can be carried forward by those who had initially opposed them, as happened in Denmark and Sweden.

Finally, fundamental reform of the social-welfare state requires leaders who embrace free-market ideas.

Rethinking requires a new ideology, and, after one country has shown the right direction, neighbors often follow.

Europe has now reached the point at which most of its laggards are prepared to accept the social-welfare society. This humane European capitalism is now hastening toward crisisridden southern Europe. ● Anders Åslund is a senior fellow at the Peterson Institute for International Economics in Washington, DC, and author of “How Capitalism Was Built.”

Copyright: Project Syndicate, 2013.

Project-syndicate.org

COVER STORY

www.wbj.pl

Polish submarine wreck found?

The wreckage of ORP “Orze∏,” a Polish submarine sunk during the World War II, has most likely been found. A vessel resembling it was discovered by Polish and UK hydrographers on the bed of the North Sea. The fate of the sub is considered one of the greatest mysteries in Poland’s war history. The submarine was lost somewhere in the North Sea in 1940.

BRE Bank rebrands for z∏.100 million After November this year, all of BRE bank’s services will be offered under the mBank brand. The lender has already spent z∏.50 million out of a z∏.100 million budget on the project. New graphic elements and a new online transaction system will be introduced, BRE Bank CEO Cezary Stypu∏kowski said. The logo used in different segments of BRE Bank’s services will vary slightly in color. ●

JUNE 10-16, 2013

Tourism in focus

Poland attracts more tourists Beata Socha Despite the continuing slowdown in European economies, Poland is attracting more tourists from all over the world After a decline prompted by the financial crisis in Europe in 2009, the number of tourists in Poland, both domestic and international, has been rising steadily in recent years, as have the sums of money they leave behind. In 2012 some 13.3 million foreigners visited the country, spending nearly $10.7 billion during their stay.

In comparison, the previous year 11.9 million foreign nationals visited Poland, spending a total of $9 billion.

Tourism plays a significant role in the Polish economy.

The value of the Polish travel and tourism industry in 2012 stood at $25 billion, equivalent to roughly 5 percent of Poland’s GDP, according to the World Economic Forum.

Last year there were 749,000 jobs in the sector, a 4.6 percent share in the country’s total employment.

A recent report by Marke-

COURTESY OF BRISTOL HOTEL

12

Competition for hotel visitors is fierce in Warsaw. Pictured: Hotel Bristol tresearchreports.biz lists three main reasons for Poland’s increased popularity as a tourist destination: its stable economy, various promotional campaigns organized by Polish local and

central authorities as well as the hosting of several high-level international events, such as Euro 2012, which Poland cohosted with Ukraine.

Cultural potential

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The 2012 surge in tourism helped Poland climb seven spots in the World Travel & Tourism Competitiveness Index, prepared by the World Economic Forum, from 49th position in 2011 to 42nd in 2013. In this year’s ranking it outdid countries such as Thailand, Mexico, China and Turkey. Among European destinations Poland ranked 27th.

Its strongest suit is its human, cultural and natural resources, a category in which Poland scored 32nd, while its regulatory framework (48th) and business environment and infrastructure (58th) pulled the country down in the ranking.

Poland’s tourist highlights are its cultural heritage (ranked 18th in the world), the health and hygiene factor (35th), its high level of education and training (37th) as well as environmental sustainability (37th).

Despite the improvement, Poland is still far from being a tourism-oriented country. In fact, it received its lowest score among all the factors examined by the World Economic Forum for its citizen’s affinity for travel and tourism (125th out of 140 countries) and the prioritization of the sector in government policies (96th).

‘Touch the Mystery’

S i g n u p f o r a 2 - w e e k f r e e - t r i a l ! w w w. p o l a n d a m . p l G e r m a n v e r s i o n : w w w. p o l e n a m m o r g e n . p l

Polish authorities have been trying to remedy the situation for some time, carrying out a number of promotional cam-

paigns aimed at attracting tourists to Poland, and with a certain amount of success, too.

A Polish film promoting the region of Lower Silesia in southern Poland managed to win the grand prix at the 2013 international Film Art & Tourism Festival organized by the International Committee of Tourism Film Festivals in May. The video, entitled “Dotknij Tajemnicy” (“Touch the Mystery”), was selected out of a group of 150 films from 20 countries and shared first place with Dubai’s presentation video, “Definitely Dubai.” It portrayed the treasures of the region, such as the recently refurbished 19th-century Wroc∏aw G∏ówny railway station and the Czocha Castle, a 13th-century fortress.

Business venue But historic sites and natural phenomena are not the only attractions Poland has to offer its visitors. It is also shaping up to be a popular destination for various business events, fairs and conferences. According to a report prepared by the Polish National Tourist Office, there were 17,672 business

events organized in Poland last year, visited by over three million participants.

There is an increasing number of international events organized in Poland, too. As many as 32 international conferences are scheduled to take place in Poland this year, including the European Go Federation meeting in August, which will bring some 2,500 participants to Gdynia, northern Poland, or the European Molecular Biology Organization conference to be held in September in Pu∏tusk, central Poland, which is expected to attract 7,500 guests.

More beds The influx of international guests is particularly important to hotel owners, who have been facing increasingly stringent competition since Poland expanded its hotel base for the Euro 2012 soccer championship. In July 2012 there were 2,014 hotels in the country, 131 more than a year earlier.

One of the most recent additions to the Polish hospitality facilities market is a new

Moving up Poland in the Travel & Tourism Competitiveness Index Country

Rank 2013

Rank 2011

Switzerland

1

1

United Kingdom

5

7

Estonia

30

25

Czech Republic

31

31

Greece

32

29

Poland

42

49

Thailand

43

41

Turkey

46

50

Brazil

51

52 Source: World Economic Forum

COVER STORY

www.wbj.pl

COURTESY OF EMIRATES AIRLINES

JUNE 10-16, 2013

Emirates Airlines began flying to Warsaw in February this year four-star Novotel in the center of the city of ¸ódê. There are also several hotel projects in the pipeline, which will further expand Poland’s hotel base, including Courtyard by Marriott in Gdynia, and NH Hoteles in Wroc∏aw.

B&B Hotels France has plans to expand its offer in Poland from two properties in

2012 to as many as 12 by 2014.

In addition, Hampton by Hilton Hotels are under construction at two locations in Poland: one near the Chopin Airport in Warsaw and another one near the Gdaƒsk Airport. InterContinental Hotel Group also plans to expand its presence in Poland by opening 30 new hotels in the

coming years.

In fact, the surplus of beds might come in handy during the UEFA Europa League Final, which will be held in Warsaw in 2015. The previous major sports event, the 2012 European soccer championships, attracted some 677,000 fans from over 120 countries, according to the

Marketresearchreports.biz report.

High-end, low-end Poland is indeed trying hard to become more open to tourists from all over the world. During the recent visit of Parliamentary Speaker Ewa Kopacz to China (see story, p. 3), the delegation

inaugurated a promotional campaign entitled “Another Way of Living in Poland,” aimed at promoting Poland in China. There is a lot of potential there. In fact, among European nations, Poland experienced the third-largest increase in the number of visitors from China in 2012, according to Bankier.pl. The number of Chinese tourists who visit Poland per year has already tripled since 2001.

Being more accessible might also help Poland promote its tourist attractions internationally. Two Middle Eastern airlines began flying to Poland recently: Emirates and Qatar Airways, offering passengers connections to 130 cities around the globe. Emirates is the first international airline operating in Poland which offers its passengers first-class seats.

Passengers of luxury flights and guests of five-star hotels are not the only clientele that Poland wants to attract, though. It is equally prepared to cater to budget travelers as well. Warsaw was ranked the third-cheapest European capital for a weekend holiday, in a listing prepared by web portal wp.pl. The cost of a weekend trip to Warsaw was estimated at z∏.726.30, which places the Polish capital after Vilnius (z∏.686) and Budapest (z∏.654), but ahead of Riga (z∏.755.6) and Lisbon (z∏.809.9). ●

13

ZCh Police to invest in Senegal?

Fertilizer producer Zak∏ady Chemiczne Police (ZCh Police), a member of chemical holding Grupa Azoty, is planning major acquisitions in Senegal, daily Dziennik Gazeta Prawna reported. The company plans to spend up to $30 million to acquire phosphorite licenses in the African country. If the transaction is completed, Senegalese phosphorite could cover some 50 percent of ZCh Police’s needs.

Exports at €12.37 billion in April Exports from Poland amounted to €12.371 billion in April, according to estimates from the Export Credit Insurance Corporation. The figure decreased by 3.1% month-on-month and increased by 4.7% yearon-year. The export value in z∏oty was z∏.51.197 billion, 3.5% less than in March and 3.7% more than in April 2012. ●

The Novotel ¸ódê Centrum has opened, bringing the city its fourth 4-star hotel

Karolkowa Business Park offers a unique work environment, according to Eyal Mor, managing director at Asbud Poland

15

16-17

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

Electronic hotel reservation system operator HRS has leased the entire 11th floor of the 21-storey tower within the multifunctional complex Plac Unii in the heart of Warsaw. The new tenant will occupy 996 sqm of office space. The Plac Unii complex comprises three buildings located on Pl. Unii Lubelskiej and offers a total of 56,800 sqm GLA, including 41,300 sqm of class-A office space and 15,500 sqm of retail space.

Inglot at Gemini Park Bielsko-Bia∏a Makeup producer and retailer Inglot has leased 30 sqm in the Gemini Park Bielsko-Bia∏a shopping mall in Bielsko-Bia∏a, in Poland’s southern Silesia voivodship. The company will open its store there after the expansion of the mall from 27,500 sqm to 45,000 sqm is completed in Q3 2013.

ECE to manage Silesia City Center One of the investors that recently acquired the Silesia City Center shopping mall in Katowice for €412 million, ECE, will also manage the shopping mall. One of the five biggest shopping centers in Poland and located on ul. Chorzowska 107 in Katowice, it comprises some 90,000 sqm of retail space. ●

In this issue HB Reavis Warsaw plans . . . . .14 Galeria Neptun . . . . . . . . . . . . . .14 Nordea House, Green Corner .15 Hochtief in Wola . . . . . . . . . . . . .15 Outlet Center Lublin . . . . . . . . .15 Novotel Łódź Centrum . . . . . . .15 Asbud interview . . . . . . . . . .16-17

Office

HB Reavis gears up for ul. Chmielna offices The Slovakian developer will launch construction on a huge office project in the center of Warsaw, possibly as soon as next year Real estate developer and investor HB Reavis will launch construction on a large office project on ul. Chmielna in the center of Warsaw, opposite the Z∏ote Tarasy shopping mall.

The developer bought the plot

tect and project partner at JSK Architekci. Mr ChruÊciƒski has significant experience in the field and has been involved in projects including the National Stadium, as well as the Horizon Plaza and Park Avenue office buildings in Warsaw.

The plot on ul. Chmielna was the first one in Warsaw that caught the eye of Stanislav Frnka, country CEO of HB Reavis Poland, when he came to Poland for the first time in 2007.

from Polish State Railways (PKP) for z∏.1.7 million.

The company is planning a complex comprising approximately 100,000 sqm of leasable space and including high-rise buildings. It is currently working on the architectural concept of the investment. Construction on the scheme could launch as soon as 2014.

HB Reavis has also appointed a new development manager responsible for the project, Marcin ChruÊciƒski, previously an associate archi-

“It was a really ugly parking lot in one of the best locations imaginable and it needed to be developed,” Mr Frnka said in an interview with Lokale Immobilia in April.

“At that time there were still legal issues regarding the perpetual usufruct of this land and I was told not to touch the subject. But when PKP announced the tender for it, we didn’t hesitate for a minute and went for it,” Mr Frnka added.

Active in five European

countries, HB Reavis has to date developed a total of more than 600,000 sqm of office, retail and logistics space. It has recently completed the Konstruktorska Business Center office scheme in the Warsaw’s Mokotów district and laid the cornerstone for its Gdaƒski Business Center office project near Gdaƒski railway station, also in Warsaw. The firm is also planning to deliver an office complex near the Warsaw West railway station.

Karolina Kowalska

Retail

Two malls slated for Starogard Gdaƒski Galeria Neptun and Gryf will bring nearly 40,000 sqm of GLA combined to the market Developer Galeria Neptun has launched construction on its eponymous shopping center in Starogard Gdaƒski. The investment is scheduled for completion in autumn 2014.

Meanwhile, developer Blue Ocean Investment Group (BOIG) plans to start building its Gryf shopping center project in the same city later this year.

Galeria Neptun will become the largest retail facility in the city, at 54,000 sqm, 25,000 of which is designated for lease. The mall will comprise two floors above ground and an underground parking lot for 618 cars. The general

contractor on Galeria Neptun is Dekpol.

The investment is already 50-percent leased, with a supermarket and major retail companies as tenants. The leisure part of the center will include a bowling alley.

The mall is being developed on the former site of footwear manufacturer Neptun, once the largest employer in the city, at the intersection of ul. Pomorska and ul. Jana Paw∏a II in Starogard Gdaƒski’s downtown area.

Cushman & Wakefield’s retail department is the exclusive leasing agent for the Galeria Neptun shopping center.

C&W is involved in the process of obtaining planning permission and the building permit, as well as in the preparation of the building’s design and landscaping.

BOIG’s Gryf shopping

COURTESY OF CUSHMAN & WAKEFIELD

HRS in Plac Unii

JUNE 10-16, 2013, LI 18/22

Galeria Neptun is expected to be delivered by the end of 2014 mall, situated in the same neighborhood, will deliver 14,500 sqm of GLA and may

be expanded significantly in the future. Construction, scheduled to launch this

autumn, is expected to take 18 months.

Karolina Kowalska

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

JUNE 10-16, 2013

LOKALE IMMOBILIA – REAL ESTATE

www.wbj.pl

15

Hospitality

Office

Green Corner (pictured) and Nordea House together comprise some 27,000 sqm of leasable space

The two Skanskadeveloped buildings were sold to RREEF last year for €94.6 million The Nordea House and Green Corner office buildings in Warsaw’s Wola district were officially opened at the end of May. The buildings comprise a total of 27,000 sqm of leasable area and are

located at the intersection of ul Ch∏odna and ul. Wronia, near the currently under-construction second line of the city’s subway.

Both buildings, developed

by Skanska Property Poland and sold to RREEF at the end of last year for €94.6 million, were nearly fully leased out before the end of construction. Their tenants include Nordea Group, Grant

The Orbis and Accor facility will be the fourth four-star hotel in the city

Thornton, Jones Lang LaSalle Group Services, CHI Polska and Ruch.

The buildings, managed by Jones Lang LaSalle, have been LEED pre-certified with the highest rating and feature ecological solutions.

Skanska Property Poland is currently planning another office scheme, Atrium 1, which the firm says will be the greenest building in Poland. The 15storey scheme will provide 18,000 sqm of leasable space in March 2014. The development is to feature pioneering energy-saving and environmentally friendly solutions, including a geothermal heating and cooling system which is currently used in just a few office buildings in Europe.

Skanska Property Poland has been operating since 1997. The company’s completed office investments include Poland’s first EU GreenBuilding-certified developments – the Deloitte House and Marynarska Point projects in Warsaw, as well as the Grunwaldzki Center scheme in Wroc∏aw, Lower Silesia voivodship.

Orbis and its strategic partner Accor opened the four-star Novotel ¸ódê Centrum hotel in the center of ¸ódê last week. The 11-storey facility was developed by Echo Investment and offers 161 rooms and conference halls, the largest of which can host up to 180 people.

The building, situated on Al. Pi∏sudskiego 11a, is the tallest development along ul.

Pi∏sudskiego and ul.

Sienkiewicza. It is within walking distance of the famous ul.

Piotrkowska, one of the city’s most central streets, where many bars and restaurants are located.

The hotel can host 350 people in its 161 air-conditioned rooms, including luxury suites and rooms with facilities for disabled guests. It also hosts a conference center, a bar, a fitness club, a video game area and a restaurant.

The scheme was designed

by Poznaƒ’s Biuro Architektoniczne Litoborski & Marciniak and the interiors were designed by Igloo Architec-

Karolina Kowalska

COURTESY OF ECHO INVESTMENT

SOURCE: COURTESY OF JONES LANG LASALLE

Nordea House, Green Novotel opens in ¸ódê Corner open for business

The Novotel ¸ódê Centrum hotel boasts 161 rooms tures and Atome Associes design studios from France.

Novotel ¸ódê Centrum is situated seven kilometers from the ¸ódê W∏adys∏aw Reymont Airport and just one kilometer from two main railway stations.

The development is also the fourth four-star hospitality facility in ¸ódê. The other three are Ambasador Centrum at ul. Pi∏sudskiego 29, Andel’s Hotel ¸ódê at ul.

Ogrodowa 17 and Holiday Inn ¸ódê at ul. Piotrkowska 229/231. A fifth one, Double Tree by Hilton at ul. ¸àkowa 29, will open later this month.

Warsaw Stock Exchangelisted Echo Investment has previously delivered hotels for

several hospitality chains, including Accor (Ibis hotels in Poznaƒ, Szczecin, Warsaw, Zabrze, Cz´stochowa, Kraków and ¸ódê, as well as Novotel hotels in Kraków and Szczecin), Qubus (in Kielce, Gliwice and Kraków), and the Campanile/Kyriad/Premiere complex in Warsaw.

Echo is one of the largest property investors and developers with Polish capital operating in Europe. It has completed more than 90 projects in Poland to date, with a total of over 800,000 sqm of space.

The company is also active in Romania, Hungary and Ukraine.

KEK

Retail

Residential

Outlet Center in Lublin receives building permit

Hochtief to build residences in Wola

as the city is located in near both the Belarusian and Lithuanian borders.

Outlet Center Lublin will be the first such retail facility in the city and the 11th in Poland.

After a period of stagnation in the first years of the crisis, the outlet center business is picking back up, with Neinver’s Factory Outlet Annopol in Warsaw having opened in March and another outlet center in Bia∏ystok being developed by BOIG. According to retail market insiders, several developers and investors plan to build a number of other outlet centers in Poland.

Construction is set to begin in Q3 this year

The JK 51 residential estate will comprise 279 apartments and three retail units in total

KEK

COURTESY OF CBRE

Outlet Center Retail Management has been granted a building permit for its Outlet Center Lublin on ul. Me∏giewska, one of the main thoroughfares in Lublin, in southeastern Poland.

The facility will deliver a total of 16,000 sqm, 12,100 of which will be leasable, and will boast approximately 100 retail units.

Scheduled for completion in the first quarter of 2014, the facility will be the easternmost outlet center in Poland and is expected to attract both Polish

and Ukrainian visitors.

According to the exclusive leasing agent, CBRE, the center has already attracted some major tenants.

The investor behind the scheme, Outlet Center Retail Management, is part of the ADV Por Property Investment development group belonging to the FORUM XVIII closed investment fund. The company is currently developing another outlet center in Bia∏ystok in northeastern Poland, also being commercialized by CBRE. The facility in Bia∏ystok is expected to attract visitors from Belarus and Lithuania,

COURTESY OF HOCHTIEF

The first outlet center in Lublin will deliver 12,100 sqm of GLA in Q1 2014

The center hopes to attract customers from Ukraine, as well as eastern Poland

Hochtief Polska has been granted a building permit for its JK 51 residential estate in the Warsaw’s Wola district.

Construction is set to begin this fall.

The multifamily housing scheme is located on ul. Jana Kazimierza 64 in the Odolany neighborhood and will deliver a total of approximately 280 apartments in two buildings. The construc-

tion will be conducted in two phases.

The first phase of the investment is scheduled to launch in Q3 2013 and finish in Q1 2015. It will consist of a nine-storey building with 163 apartments, four commercial units and an underground parking lot. The second phase will consist of 116 apartments and three retail units.

Future owners can choose from studio to four-bedroom apartments, ranging from 32 sqm to 77 sqm, priced from z∏.6,700 per sqm.

The JK 51 project is the second investment that

Hochtief Polska will carry out in the so-called “formart” formula, according to which the company will take care of the entire development process.

The first such project is the 42apartment Villa Poema scheme that the investor delivered last year in Warsaw’s ˚oliborz district.

The post-industrial neighborhood of Odolany is becoming increasingly popular among the developers and apartment-buyers. Built on the sites of former factories, the new residential estates now offer many green areas.

Karolina Kowalska

www.wbj.pl

C&A in Solaris Center Clothing retailer C&A has extended its lease agreement in Solaris Center shopping mall in Opole for another five years. The two-floor C&A comprises 1,663 sqm of retail space in a 17,000sqm scheme. Located on Pl. Kopernika in the center of Opole, the capital of Opolskie voivodship in the south of Poland, Solaris Center hosts 86 retail units. Real estate investor Irlandzka Grupa Inwestycyjna opened Solaris Center in 2009.

GTC to sell Galeria Jurajska Real estate developer Globe Trade Centre (GTC) is in talks to sell its Galeria Jurajska shopping mall in Cz´stochowa, the company said in a statement. It has received a purchase offer from Heitman International and signed a document on nonbinding deal conditions.

Galeria Jurajska will be sold at a price based on current market yield, GTC said. ●

LOKALE IMMOBILIA – REAL ESTATE

JUNE 10-16, 2013

Interview

Investing in diversity Lokale Immobilia sits down with Eyal Mor, managing director at Asbud Group, to talk about the company expanding its business activities into the office market, about building “green” and cautious investment.

Karolina Kowalska: You have relaunched construction on Karolkowa Business Park in Warsaw’s Wola district, 50 percent of which you bought from Ablon Group in December 2012, along with property management rights. It is your first office project in Poland.

Why did you decide to expand your business activity into the office market?

Eyal Mor: It’s the first office investment we have begun construction on, but the second one we have planned. We have another project in [Warsaw’s] Mokotów district in the pipeline which we will initiate probably in the beginning of the next year, depending on market conditions.

Investing in Karolkowa Business Park we aren’t exact-

ly discovering new territory.

We represent the company’s big shareholders and several Israeli companies. Our group is involved in all types of construction: residential, commercial, including energy plants, infrastructure: we build bridges and roads in Africa and we manage rental apartments in Germany. We strongly believe there must be diversity in a company.

Some of our main shareholders are listed on the stock exchange in Israel. Our parent company is active in 18 countries: in Europe, Africa and South America. We have been developing office projects around the world, including in Europe, in countries such as Germany, Italy, Romania and the Czech Republic. So we have the know-how and all the tools to be successful on the office market.

But before the Karolkowa project, you were investing mainly in the residential market in Warsaw and on its outskirts, weren’t you?

We have been in Poland for 15 years now, investing mainly in the residential market. To date we have delivered over 1,000

COURTESY OF ASBUD GROUP

16

Karolkowa Business Park will be Asbud Group’s first office investment in Poland units in [Warsaw’s] Tarchomin, Konstancin and Bia∏o∏´ka districts.

When we started discussing our investment plan for 2013, we decided to invest in the office market, as it is stable now, compared to a few years ago when the entire real estate market wasn’t stable.

I think Poland’s economic outlook is very good now. We also considered investing in

the office market prior to the crisis, and we even bought a plot in Mokotów for that purpose but waited for market conditions to improve.

Why did you choose Karolkowa Business Park?

We came into this opportunity as we saw the project. After buying a 50 percent stake in the investment, we reviewed the design again and changed

everything that we needed to, from the interior to the materials that we are using, as well as the marketing aspects.

We’ve gone through the entire process again, making sure that everything is in place.

When the project is halted at some point, it has to be reviewed. We commenced construction on February 15.

We currently own several plots in Warsaw and we are in

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JUNE 10-16, 2013

the process of negotiating some more acquisitions. We wouldn’t get into any kind of venture, like initiating a major project, if we weren’t ready for it.

Our policy, taken from our parent company, is not to fight the market. We believe in mass residential projects just like the one in Bielany, which was very successful. We examine each plot at the time and we carefully examine each investment and all the market conditions. We are not working in a casino. We are looking for stable income and profit and on top of everything we want to be a good brand and we want our projects to be environmentally friendly.

Decisions such as launching a new project need to be taken at the right time and place. You make better decisions while not under pressure.

Three years ago you could get €16 per sqm only in Mokotów, now you can get an office in Wola for €16-18 per sqm. It’s very close to the Central Business District and I can say it will be the next CBD. We can already see a lot of interest in the Karolkowa project.

What are the advantages of Karolkowa? Why do you think it will succeed surrounded by so many other office towers, such as Warsaw Spire?

First of all we are offering 15,000 sqm as opposed to 100,000 sqm, which is a completely different working environment. Second of all, our biggest advantage is the subway station within 250 meters from the building, as well as the area itself. The connection to all the other buildings and its tenants will create a perfect business environment.

We will have an internal road within the project so you could go from one service provider to another. There are already seven banks in the area. This place could easily turn into some sort of a financial district. Within the next two years it will be a nice environment to work in, where everything is around your workplace – social facilities, stores, a dry cleaner.

On top of that I think the layout of the building is very efficient, convenient and it

took a lot of planning to make it adhere to the sustainability policy that we have in our parent company.

So it could be called a green building?

It could, but “green” doesn’t say it all. I prefer the word sustainable, which is not only green, but also social and economical to live in. It is green to work next to the subway and social areas, it is green to create a pleasant environment for a person to function in – as we spend a minimum of eight hours a day at work.

The fact that we will get a certificate of sustainability means that all the processes of construction have gone in accordance with regulations, they have gone through a series of tests and it will be a quality product.

The air-conditioning will be different, more user-friendly, as will the water- and electricity-saving systems. The building is designed in such a way that for most of the day you can use sunlight.

Karolkowa Business Park stands out among other buildings in the area with its wooden elements, doesn’t it?

We’ve preserved the original brick walls of the former Philips factory, which give this place some character, making it not just some workplace but

one with history. We are in contact with the former owner and we will work together on erecting a monument within the project to commemorate the building’s history.

We also want Philips to have some kind of signature on the building. It was a big employer in this part of the city and we feel that honoring its tradition is something that we need to do.

When are you planning to launch construction on your second office project – Bokserska, in the Mokotów district?

Bokserska is something we have a long history with and a lot of patience for. We bought the plot some years ago and we have gone through a very long process of obtaining a building permit. Our aim is to launch construction next year but it all depends on the situation on the market, whether it is ready for it or not.

We already have some interest from clients that are looking to rent in that location and we are already in negotiations with some of them. We can offer a quality product for a reasonable price. But clients renting in Mokotów are different from those in Wola and the investor always has to adjust its solutions to cater to its clients’ needs. ●

COURTESY OF ASBUD GROUP

Aren’t you afraid of the oversupply on the office market, especially in Wola?

It is not something that we are not aware of. Figures clearly show there will be an oversupply in 2015, with the Warsaw Spire completed and other office buildings in the area.

But Karolkowa will be a very good product at a very good price in an area that is shaping up to be the new Central Business District.

LOKALE IMMOBILIA – REAL ESTATE

This is how Karolkowa Business Park will look when completed

www.wbj.pl

17

18

THE LIST

www.wbj.pl

JUNE 10-16, 2013

Travel & Leisure

Four- and Five-Star Hotels in Poland Listed by area of connected conference modules

Rank

A guide to Polish business and industry

www.bookoflists.pl

Przewodnik po polskim biznesie i gospodarce

Company name Address Tel./Fax E-mail Website

Sheraton Sopot Hotel, Conference Center & Spa ul. Powstaƒców Warszawy 10, 1 81-718 Sopot 58 767-1000/58 767-1001 sopot@sheraton.com www.sheraton.pl/sopot/ Warsaw Marriott Hotel Al. Jerozolimskie 65/79, 00-697 Warsaw 2 22 630-6306/22 830-0311 mail@marriott.com.pl www.warsawmarriott.com

Class

Area of largest Number of Total area of connected confference SPA/beauty conference modules room (sqm) / All rooms / Rooms for disabled / center / (sqm) / Number of Suite Number of Business Indoor seats in rooms / conference rooms / class swimming pool / largest Restaurants rooms Number of seats in Fitness center conference all conference rooms room

Hotel amenities For disabled persons / Lobby bar / Night club

Newsstand/ souvenirs / Business center / Exchange

Internet Access / Guarded parking / Underground parking

Attractions in the hotel

Year opened

Contact person for reservations

5*

4,000 10 1,200

545 660

190 8 2

2 13

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ -

✓ ✓

Kids Club - playroom, Club Lounge; Link @ Sheraton; bicycle rental; Vinoteque - wine cellar in the basement of the historic rotunda; Rotunda Cafe overlooking the Baltic Sea and the longest wooden pier in Europe

2008

Sales: konferencje.sopot@sheraton.com, 58 767-1670

5*

2,600 16 1,800

595 700

518 43 5

10 518

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓

Hairdresser; gifts; car rental, florist

1989

El˝bieta WiÊniewska: ela.wisniewska@marriotthotels.com, 22 630-7332

5*

1,500 15 1,100

781 650

343 12 2

3 41

✓ ✓

✓ ✓ -

✓ -

✓ ✓

Casino; beauty institute

1976

Conference and banquets: H3378-SB4@sofitel.com, 22 657-8283

Hilton Warsaw Hotel & Convention Centre ul. Grzybowska 63, 00-844 Warsaw 4 22 356-5555/22 356-5556 info.warsaw@hilton.com www.warsaw.hilton.com

4*

1,406 12 WND

1,406 1,600

314 11 1

4 22

✓ ✓ ✓

✓ ✓ -

✓ ✓ -

✓ ✓

Express check-in/check-out; allergyfree room; babysitting service; children’s menu; cribs; baggage storage; car rental desk; lounge; room service; ATM

2007

Convention & Event Sales Department; info.warsaw@hilton.com; 22 356-7353

Hyatt Regency Warsaw ul. Belwederska 23, 00-761 Warsaw 5 22 558-1234/22 558-1235 warsaw.regency@hyatt.com www.warsaw.regency.hyatt.com

4*

835 13 600

385 350

246 19 1

3 60

✓ ✓ ✓

✓ ✓ -

✓ ✓

✓ ✓

Casinos Poland; Venti-tre restaurant with italian cuisine

2002

Emilia Noster: emilia.noster@hyatt.com, 22 558-1016

Crown Piast Hotel & Park ul. Radzikowskiego 109, 31-342 Kraków 6 12 683-2600/12 683-2665 recepcja@hotelpiast.pl www.hotelpiast.pl

5*

700 9 700

315 300

179 15 1

2 20

✓ ✓

✓ ✓ -

✓ ✓ -

✓ -

Garden with a regional cuisine inn; tennis court; sauna; jacuzzi

1991

Sales department: biuro@hotelpiast.pl, 12 683-2600

Radisson Blu Centrum Hotel ul. Grzybowska 24, 00-132 Warsaw 7 22 321-8888/22 321-8889 info.warsaw@radissonblu.com www.radissonblu.com/hotel-warsaw

5*

591 8 544

346 400

311 18 2

4 73

✓ ✓ ✓

✓ ✓ -

✓ ✓ ✓

✓ ✓

Three styles of rooms; close to the city center

2002

Anna Kucharz: meetings.warsaw@radissonblu.com, 22 321-6680

Hilton Gdaƒsk Targ Rybny 1, 80-838 Gdaƒsk 8 58 778-7100/58 778-7300 Gdnhg_hotel@hilton.com Hiltongdansk.pl

5*

560 6 350

142 150

150 5 1

3 40

✓ ✓ ✓

✓ ✓ -

✓ -

✓ ✓

Swimming pool located on the top floor with a glass roof combined with a summer tarrace

2010

Gdnhg_ds@hilton.com, 58 778-7341/ 58 778-7342

Hotel Sympozjum & SPA ul. Kobierzyƒska 47, 30-363 Kraków 9 12 261-8600/12 261-8799 hotel@sympozjum.com.pl www.sympozjum.com.pl

4*

550 WND 600

270 250

80 4 1

4 22

✓ ✓ -

✓ ✓ -

✓ ✓ ✓

✓ -

WND

2004

Monika Sendler: ms@sympozjum.com.pl; Micha∏ Woênica: mw@sympozjum.com.pl

Hotel Polonia Palace Al. Jerozolimskie 45, 00-692 Warsaw 10 22 318-2800/22 318-2801 poloniapalace@syrena.com.pl www.poloniapalace.com

4*

525 8 508

180 200

206 3 1

3 48

✓ ✓

✓ ✓ -

✓ -

✓ -

24-hour room service; ATM

2004

Conference and banquets: Iwona ¸ukasik, sales@syrena.com.pl, 22 318-2811

Courtyard by Marriott Warsaw Airport ul. ˚wirki i Wigury 1, 00-906 Warsaw 11 22 650-0100/22 650-0101 wcy@courtyard.com warszawacourtyard.pl

4*

433 15 701

433 450

236 2 1

8 WND

✓

✓ ✓ -

-

✓ -

24-hour room service; information about flight arrivals and departures in the hotel lobby; interactive GoBoard touch screen with current business information, tourism; weather forecast; public transport timetables

2003

Marta Kucharska: marta.kucharska@courtyard.com.pl, 22 650-0125

Hotel SPA Dr Irena Eris Wzgórza Dylewskie ul. Wysoka WieÊ 22, 14-100 Ostróda 12 89 647-1111/89 647-1000 wzgorza@drirenaerisspa.com www.drirenaerisspa.com

5*

385 6 300

273 230

97 7 2

1 30

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ -

✓ ✓

Spa center: 2 swimming pools, 5 jacuzzis, sauna complex, fitness, cardio studio; docking station for portable multimedia devices; bicycle rental

2006

Marketing & Sales Department: Izabela Zbrzyzna, izabela.zbrzyzna@drirenaerisspa.com, 89 642-5302

Mercure Poznaƒ Centrum ul. Roosevelta 20, 60-829 Poznaƒ 13 61 855-8000/61 855-8955 H3393@accor.com www.mercure.poznan-centrum.com

4*

364 11 350

142 120

228 1 1

2 160

✓

✓ ✓ -

✓ ✓ -

✓ ✓

Sauna; business corner; own pastry shop; restaurant with French-style cousine; terrace by the bar area

1964

Conference and banquets: Lucyna Wierzbicka: H3393@SB1@accor.com, 61 855-8014

Sheraton Poznaƒ Hotel ul. Bukowska 3/9, 60-809 Poznaƒ 14 61 655-2000/61 655-2001 gss.poznan@sheraton.com www.sheraton.pl/poznan

5*

336 6 296

204 200

180 3 2

3 34

✓ ✓

✓ ✓ ✓

✓ -

✓ ✓

WND

2006

Sales Department: Mimoza Peevska: mimoza.peevska@sheraton.com, 61 655-2214

Sofitel Warsaw Victoria ul. Królewska 11, 00-065 Warsaw 3 22 657-8011/22 657-8057

H3378@sofitel.com www.sofitel-victoria-warsaw.com

THE LIST

Rank

JUNE 10-16, 2013

Company name Address Tel./Fax E-mail Website

Class

Number of Area of largest Total area of connected confference SPA/beauty conference modules room (sqm) / All rooms / Rooms for disabled / center / (sqm) / Number of Suite Number of Business Indoor seats in rooms / conference rooms / class swimming pool / largest Restaurants Number of seats in rooms Fitness center conference all conference rooms room

www.wbj.pl

19

Hotel amenities For disabled persons / Lobby bar / Night club

Newsstand/ souvenirs / Business center / Exchange

Internet Access / Guarded parking / Underground parking

Attractions in the hotel

Year opened

Contact person for reservations

Radisson Blu Hotel, Kraków ul. Straszewskiego 17, 31-101 Kraków 15 12 618-8888/12 618-8889 info.krakow@radissonblu.com www.radissonblu.com/hotel-krakow

5*

330 8 318

123 150

196 19 2

5 24

✓ ✓

✓ ✓ -

✓ ✓ ✓

✓ ✓

Theme surf & turf buffet: fish and seafood; bicycles

2003

Sales & Marketing: Angelika Szczàchor, angelika.szczachor@radissonblu.com, 12 618-8710

Radisson Blu Sobieski Hotel Pl. Artura Zawiszy 1, 02-025 Warsaw 15 22 579-1000/22 658-1365 info.sobieski.warsaw@radissonblu.com www.radissonblu.com/sobieski-warsaw

4*

330 13 700

330 450

435 47 2

4 69

✓ ✓

✓ -

✓ ✓ ✓

✓ ✓

Wi-Fi access; close to the city center

1992

Anna Antonowicz: meetings.sobieski.warsaw@radisson blu.com, 22 579-1107

5*

250 3 240

120 120

WND 3 2

5 108

✓ ✓ ✓

✓ ✓ -

✓ -

✓ ✓

Cafe; Vinoteque; exclusive boutiques mall

2003

Conference rooms reservation: Piotr Dyduch, piotr.dyduch@hotel.com.pl, 602-432-971

Sofitel Wroc∏aw Old Town ul. Âw. Miko∏aja 67, 50-127 Wroc∏aw 17 71 358-8300/71 358-8710 h5345@accor.com www.sofitel-wroclaw.com

5*

216 11 450

216 250

205 15 2

2 190

✓ ✓

✓ -

✓ -

✓ ✓

ATM; close to the city center

2001

Hanna Cegielska: H5345-SB@sofitel.com, 71 358-8709

ART HOTEL ul. Kie∏baÊnicza 20, 50-110 Wroc∏aw 18 71 787-7100/71 342-3929 info@arthotel.pl www.arthotel.pl

4*

200 5 230

90 80

80 1 1

1 20

✓

✓ -

✓ -

✓ ✓

Wi-Fi access; summer garden

1996

Sales department: konferencje@arthotel.pl, 71 7877132

Grand Hotel Kraków ul. S∏awkowska 5/7, 31-014 Kraków 18 12 424-0800/12 421-8360 hotel@grand.pl www.grand.pl

5*

200 8 400

160 150

64 9 2

1 WND

✓

✓ ✓

✓ ✓ -

✓ ✓ -

In the city center

1887

Agata Sobera: markeing2@grand.pl

Mamaison Hotel Le Regina Warsaw ul. KoÊcielna 12, 00-218 Warsaw 18 22 531-6000/22 531-6001 recepction.leregina@mamaison.com www.mamaison.com/leregina

5*

200 2 160

150 120

58 3 1

2 WND

✓ ✓ ✓

✓ ✓ -

✓ -

✓ -

Free internet and a recreation area for visitors, summer patio, a massage parlor, a sommelier (Polish Champion 2013)

2004

Reception desk: reception.leregina@mamaison.com

Hotel Noma Residence Zameczek MyÊliwski Promnice 43-210 Kobiór 19 32 219-4678/32 219-5475 hotel@promnice.pl www.promnice.pl

4*

150 3 160

150 100

13 2 1

2 4

-

✓ -

✓ -

✓ ✓ -

Sauna; sailboats; bicycles

1991

Marzena Ch∏opecka: m.chlopecka@promnice.pl

Novotel Centrum Kraków ul. Tadeusza KoÊciuszki 5, 30-105 Kraków 20 12 299-2900/12 299-2999 H3372@accor.com www.novotel.com

4*

146 8 326

146 180

198 6 1

7 23

✓ ✓ ✓

✓ ✓ -

✓ ✓ -

✓ ✓

Massages; bicycle rental; children’s play area; views of the Wawel

2002

Anna Ziemian: h3372sb1@accor.com

Hotel Rezydent Sopot Pl. Konstytucji 3 Maja 3, 81-704 Sopot 21 58 555-5800/58 555-5801 rezerwacja@hotelrezydent.com.pl www.hotelrezydent.com.pl

5*

110 2 80

110 80

64 1 1

1 9

✓ ✓

✓ -

✓ -

✓ -

24-hour room service; Pay TV; concierge services

2001

WND

Hotel SPA Dr Irena Eris Krynica Zdrój ul. Czarny Potok 30, 22 33-380 Krynica Zdrój 18 472-3500/18 472-3501 krynica@drirenaerisspa.com www.drirenaerisspa.com

4*

100 2 100

100 80

60 12 2

1 WND

✓ ✓ ✓

✓ ✓ ✓

-

✓ ✓ ✓

Spa center: 2 swimming pools, 5 jacuzzi, sauna, gym, cardio studio

1997

Anna Styrna: anna.styrna@drirenaeris.com

Hotel Branicki ul. Zamenhofa 25, 15-435 Bia∏ystok 23 85 665-2500/85 665-2501 recepcja@hotelbranicki.com www.hotelbranicki.com

4*

85 2 100

85 100

36 2 1

1 16

✓ -

✓ ✓

✓ -

✓ ✓

Havana Cigar Club

2005

Anna Horodeƒska: a.horodenska@hotelbranicki.com

Sofitel Grand Sopot ul. Powstaƒców Warszawy 12/14, 81-718 Sopot 24 58 520-6000/58 520-6099 H3419-AM@sofitel.com www.sofitel-grand-sopot.com

5*

77 5 375

250 240

127 2 1

89

✓ ✓ ✓

✓ ✓ -

✓ ✓ -

✓ -

Hotel is located beside the beach, next to the oldest wooden pier in Europe; library; a children’s playroom; Wi-Fi -champagne & caviar lounge

1927

anna.jarosinska@sofitel.com, 58 520-6044

Hotel Rialto ul. Wilcza 73, 00-670 Warsaw 25 22 584-8700/22 584-8701 info@rialto.pl www.rialto.pl

5*

60 2 45

60 45

44 11 1

1 11

✓

✓ ✓ -

✓ -

✓ -

WND

2003

Reservations: Lidia Szajewska: reservations@rialto.pl, 22 584-8777

Monopol ul. Dworcowa 5, 40-012 Katowice 16 32 782-8282/32 782-8283

monopol@hotel.com.pl www.monopolkatowice.hotel.com.pl

Notes: NR = Not Ranked, WND = Would Not Disclose. Research for The List was conducted in May 2013. Companies not responding to our survey are not listed.

The entire list will be published in the new edition of Book of Lists 2013, available from June 18th.

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. Monika Brysiak, ul. Elblàska 15/17, 01-747 Warsaw, via fax to +48 22 257-7500, or via e-mail to wbjbol@wbj.pl. Copyright 2013, 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.

20

MARKETS

www.wbj.pl

JUNE 10-16, 2013

Stocks report

world stock indices DJIA

NASDAQ

15,040.62(June 06 close)

S&P500

3,424.05 (June 06 close)

-1.85% (for the week)

FTSE100

1,622.56 (June 06 close)

-1.93% (for the week)

DAX

6,336.11 (June 06 close)

-1.93% (for the week)

-4.82% (for the week)

Stocks dip

NIKKEI225 8,098.81 (June 06 close)

12,904.02 (June 06 close)

-3.59% (for the week)

-5.04% (for the week)

CHANGE: 12.14%

CHANGE: 10.02%

CHANGE: 10.95%

CHANGE: 5.12%

CHANGE: 4.11%

CHANGE: 20.73%

(year to June 06)

(year to June 06)

(year to June 06)

(year to June 06)

(year to June 06)

(year to June 06)

52-week high: 15,542.40

52-week high: 3,532.04

52-week high: 1,687.18

52-week high: 6,875.60

52-week high: 8,553.74

52-week high: 15,942.60

52-week low:12,398.44

52-week low: 2,802.38

52-week low: 1,306.62

52-week low: 5,381.80

52-week low: 6,053.95

52-week low: 8,328.02

Andrew Nawrocki WBJ market analyst Markets shed some value last week as investors waited nervously to see whether the Fed would maintain its bond-buying stimulus program in the months ahead.

Despite better-than-expected PMI data across the euro zone on Monday, Polish stocks – like other stocks across Europe – fell.

The blue-chip WIG20 was one of the biggest losers in Europe, shedding 1.6 percent.

Stocks throughout Europe regained some ground on Tuesday, with mid-sized companies paving the way.

The mid-cap mWIG40 saw an impressive 1.4 percent gain; the WIG20 closed 0.79 higher.

Wednesday meanwhile brought poor macroeconomic news, with retail sales and GDP figures for the euro zone disappointing investors.

Major indices WIG

48,209.65 (June 07 close)

WIG20

2,488.84 (June 07 close)

07.06

06.06

05.06

04.06

03.06

31.05

29.05

28.05

27.05

24.05

23.05

22.05

21.05

07.06

06.06

05.06

04.06

03.06

31.05

29.05

28.05

27.05

2,300

24.05

44,000

23.05

2,340 22.05

45,000

21.05

2,380

20.05

46,000

17.05

2,420

16.05

47,000

15.05

2,460

14.05

48,000

13.05

2,500

10.05

49,000

20.05

52-week low: 2,039.72

17.05

Change year to June 07: -5.23%

16.05

52-week low: 36,653.28

15.05

52-week high: 2,628.36

Change year to June 07: 0.21%

14.05

Change for the week: 0.13%

13.05

52-week high: 48,222.72

10.05

Change for the week: 0.84%

Top 5 TRITON BARLINEK POLCOLORIT ORZBIALY GANT

Closing 1.08 1.23 0.09 13.70 2.30

% change (week) 52-week high 31.71 2.40 29.47 1.32 28.57 0.15 24.89 26.39 24.32 6.76

52-week low 0.57 0.58 0.07 10.60 1.08

Top 5 GTC PGNIG PKOBP ASSECOPOL BORYSZEW

Closing 8.98 6.46 35.90 43.68 0.41

% change (week) 5.65 4.70 3.13 2.80 2.50

52-week high 10.25 6.50 38.50 48.32 0.67

52-week low 5.13 3.78 30.50 36.84 0.38

Bottom 5 REGNON IDEON CALATRAVA ATLANTIS FORTUNA

Closing 0.01 0.03 0.03 0.10 16.82

% change (week) -50.00 -25.00 -25.00 -16.67 -15.82

52-week low 0.01 0.03 0.02 0.09 12.30

Bottom 5 BOGDANKA KERNEL PZU EUROCASH PGE

Closing 121.00 54.90 441.50 63.10 17.61

% change (week) -6.06 -4.36 -4.02 -3.87 -2.71

52-week high 143.00 76.00 460.00 67.50 19.54

52-week low 114.60 47.25 278.73 36.59 15.11

52-week high 0.07 0.20 0.53 0.52 20.00

Currency report

Interest rates at historic lows

Other indices sWIG80

11,721.20 (June 07 close)

NewConnect

30.75 (June 07 close)

52-week high: 11,721.20

WIG-Banki

6,847.02 (June 07 close)

SOURCE: WSE

07.06

06.06

05.06

04.06

03.06

31.05

29.05

28.05

27.05

24.05

23.05

22.05

21.05

07.06

06.06

05.06

04.06

03.06

31.05

29.05

28.05

27.05

24.05

6,200

23.05

30.0

22.05

6,340

21.05

30.4

20.05

6,480

17.05

30.8

16.05

6,620

15.05

31.2

14.05

6,760

13.05

31.6

10.05

6,900

20.05

52-week low: 5,163.30

17.05

Change year to June 07: 1.84%

16.05

52-week low: 29.82

15.05

52-week high: 6,847.02

Change year to June 07: -7.44%

14.05

Change for the week: 1.83%

13.05

52-week high: 37.05

10.05

Change for the week: 1.18%

32.0

Adam Narczewski X-Trade Brokers DM SA

07.06

06.06

05.06

04.06

03.06

31.05

29.05

28.05

27.05

24.05

52-week low: 8,984.43

21.05

20.05

17.05

07.06

06.06

05.06

04.06

03.06

31.05

29.05

28.05

27.05

10,700

24.05

2,600

23.05

10,920

22.05

2,660

21.05

11,140

20.05

2,720

17.05

11,360

16.05

2,780

15.05

11,580

14.05

2,840

13.05

11,800

10.05

2,900

16.05

Change year to June 07: 11.30%

15.05

52-week low: 2,147.52

14.05

Change year to June 07: 12.37%

13.05

Change for the week: 1.76%

10.05

52-week high: 2,888.79

23.05

2,886.30(June 07 close)

22.05

mWIG40 Change for the week: 2.61%

Stocks throughout Europe dipped, though the Polish main WIG index managed to close slightly up, gaining nearly 0.4 percent. But the WIG20 was unable to keep up, losing 0.06 percent.

On Thursday, investors eagerly awaited news from ECB boss Mario Draghi, who left interest rates unchanged at 0.5 percent, which investors reacted to negatively. The WIG20 shed 0.62 percent, with the WIG losing half a percent.

On Friday, bullish moods on international markets helped the Warsaw bourse, with the WIG20 ending the day up 1.7 percent. German industrial and export figures came in better than expected while US employment figures showed the world’s largest economy is continuing its rebound. ●

June has begun with a bang.

Mixed macroeconomic data from the US is forcing the Fed to maintain its stand on keeping the QE program unchanged, causing the US dollar to depreciate. The ECB kept interest rates unchanged and will halt further monetary policy easing as the situation in the euro zone has improved.

The EUR/USD exchange rate moved strongly all the way from $1.30 to $1.33, its highest level since February this year. In Poland, the Monetary Policy Council (RPP) cut the benchmark interest rate by 25 basis points. The market expects at least one more cut this year.

Lower interest rates have already been priced in by the market but the z∏oty still depreciated last week. The

EUR/PLN, after reaching a weekly low of z∏.4.22, jumped all the way to z∏.4.32, its highest level since June of 2012.

Next week, the euro should give up some gains but the outlook is still negative for the z∏oty. The weakening of the American currency made the USD/PLN rate less volatile. The z∏oty appreciated against the USD and finished the week in the region of z∏.3.25.

Holders of mortgages in Swiss francs, meanwhile, are experiencing hard times, after the CHF reached z∏.3.50 for the first time since September of 2012.

As with the EUR/PLN, the Swiss currency could give up some of its gains next week, but Poles should be ready for a more expensive Swiss franc in the upcoming weeks. ●

currency rates 3.3744 07.06

3.2854 06.06

SOURCE: NBP

3.2445 05.06

3.2813 03.06

3.2432

3.2816 31.05

0.1015

0.1006 07.06

3.0

04.06

PLN-100JPY

3.5

06.06

0.1011 05.06

04.06

0.1024 03.06

0.1035 31.05

3.4602

3.4993 07.06

0.100

0.1020

PLN-RUB

0.105

06.06

3.4168 05.06

3.4259 04.06

03.06

3.4569 31.05

5.0308

5.0678 07.06

3.3

3.4335

PLN-CHF

3.5

06.06

4.9714

4.9764 05.06

03.06

04.06

5.0181 4.8

31.05

3.2545 07.06

3.2564

5.0154

PLN-GBP

5.3

06.06

3.2421 05.06

3.2524 04.06

03.06

3.2953 31.05

4.2742

4.3061 07.06

3.0

3.2865

PLN-USD

3.5

06.06

4.2349 05.06

4.2520 04.06

03.06

4.2902 31.05

4.0

4.2786

PLN-EUR

4.5

SPORTS

JUNE 10-16, 2013

www.wbj.pl

21

Polish soccer

Tennis

Time to say goodbye

Radwaƒska knocked out in French Open quarterfinal

Legia players celebrate their championship defender Micha∏ ˚ew∏akow will take up a managerial position with the team; defender Dickson Choto, who played in Warsaw for 10 years, will try his luck elsewhere; and arguably the best player over the last two seasons, striker Danijel Ljuboja, will leave Poland and most likely finish his career in France.

As many as 10 Wis∏a Kraków players will leave the club after the season. The fans, however, will really only miss one of those, 35-yearold midfielder Kamil Kosowski. Mr Kosowski was one of the last links to the team’s glory days, when the club went toe-to-toe in Europe with established

clubs such as Shalke 04, AC Parma and Real Saragossa.

He is retiring after the club’s owners decided not to sign him to a new deal.

Last but not least, the league said goodbye to Polonia Warszawa and GKS Be∏chatów, both of which were relegated. The Warsaw side did not receive a license from the Polish FA because of its massive debts. It will most likely play in the fifthtier league next season. GKS Be∏chatów, despite winning its last game against Piast Gliwice 3-2, only managed to place second-to-last in the league table and will play in the second-tier 1. Liga next year.

Jacek Ciesnowski

Fourth-seeded Agnieszka Radwaƒska of Poland lost to fifth-seeded Italian Sara Errani after a close, dramatic game in the quarterfinals of the French Open 4-6, 6-7. The second set alone had eight breaks of serve and ended up in a tie-break, which Ms Errani won 8-6.

Despite the loss, Radwaƒska was happy with her performance. “It was a really close game, if a few balls had gone the other way, I would have won. Clay is my least-favorite surface to play on, so I’m happy that I managed to advance so far,” she said after the match.

Ms Radwaƒska couldn’t fully prepare for this particular Grand Slam tournament as she was nursing a shoulder injury.

Ms Errani, on the other hand, had already played over 80 matches this year, almost double that of anyone else in the top 10.

It was Ms Radwaƒska’s first-ever Roland Garros quarterfinal and eighth Grand Slam

SHUTTERSTOCK

With all of the most important results known before the last games of the season in the TMobile Ekstraklasa, the top league of Polish soccer, fans concentrated on saying goodbye to some of their favorite players for the last time.

For example, Lech Poznaƒ fans were sent into a tizzy when Ivan Djurdjevic scored a goal against Korona Kielce, after a pass from Piotr Reiss. For both of the club’s legends, the 2-0 win was the last game of their careers.

Jagiellonia Bia∏ystok, and indeed the entire league, won’t be the same without Tomasz Frankowski. The goal-scoring machine dubbed “Franek – ¸owca Bramek” (Franek the goal hunter) scored 168 goals in the league, placing him third in the overall rankings. His feat is even more impressive considering Mr Frankowski spent nearly a decade playing abroad.

The game between newly crowned champions Legia Warszawa and last season’s winners Âlàsk Wroc∏aw (a 5-0 win for Warsaw), was the last for three Legia players:

It was Ms Radwaƒska’s best showing in Roland Garros to date

COURTESY OF T-MOBILE EKSTRAKLASA/X-NEWS.PL

Some high-profile names in Polish soccer have hung up their cleats for the last time

Agnieszka Radwanska quarterfinal. She advanced further only once: last year she reached the Wimbledon final, which she lost to Serena Williams.

In other tournament news, Agnieszka’s younger sister Urszula defeated the older

Williams sister, Venus, in the first round (7:6, 6:7, 6:4), but lost in the next round to German Dinah Pfizenmaier. If Urszula had won that game, she would have faced her older sister in the third round.

Jacek Ciesnowski

22

LIFESTYLE

www.wbj.pl

JUNE 10-16, 2013

Concert

Concert

Star of the silent silver screen

Jersey Boys

Polita duced by Platige Image, a film studio responsible for the Oscar-winning short film “The Cathedral.”

“Such a vision, such brilliant use of technology that nobody has yet applied – it seemed as though the technique of mixing the threedimensional film with actors has already existed for

decades on the stage. It is so mature, so incredibly penetrating. I am absolutely stunned,” said S∏awomir Idziak, another Oscar winner (for his cinematography in “Black Hawk Down”) in a review of the musical.

Tickets for the show start at z∏.90 Jacek Ciesnowski

SHUTTERSTOCK

“Polita,” the first and so far only Polish musical with 3D effects, returns to Torwar mid-June. The performance tells the story of Polish-born Pola Negri, a Hollywood star from the silent-movie era.

Ms Negri, played by Natasza Urbaƒska, began her career in Poland before moving to Germany in 1917 and later on to the US (in 1922), where she became a huge star.

Her affairs with Charlie Chaplin and Rudolph Valentino were the talk of the town back then, and she was a main feature in the gossip columns of the era.

Her love life is the focus of the musical. Thanks to a combination of 3D effects with real stage elements, the viewers will see the huge Paramount sound stage filled with virtual actors and find themselves in the middle of Wall Street just as the market collapsed in 1929.

The 3D effects were pro-

COURTESY OF POLITA-MUSICAL.PL

Polita June 14 Torwar ¸azienkowska 6a Warsaw

Jon Bon Jovi

Bon Jovi June 19 PGE Arena Gdaƒsk After 30 years in music New Jersey natives Bon Jovi will finally perform in Poland.

The band, formed in 1983 by John Francis Bongiovi, Jr, better known as Jon Bon Jovi, has 12 studio albums to its credit and four numberone hits on the Billboard charts. The band claims it has sold over 100 million records worldwide and has played over 2,700 shows, often in sold-out stadiums.

The band has come a long way over its 30 years in the music business. Mr Bon Jovi himself started out singing

“Merry Christmas” to R2-D2 on a Star Wars-themed Christmas album, his first professional recording.

During all that time, the band has maintained a relatively stable line-up, having replaced only their original bass player Alec John Such with Hugh McDonald (who, however, is not officially listed as a member of the group).

That is, until now – it seems a personal feud between Mr Bon Jovi and long-time lead guitarist Richie Sambora is keeping Mr Sambora off the tour. As of press time, it looked very much like Mr Sambora would not be joining Bon

Jovi for their gigs in Europe.

Even though the band’s most successful album to date was 1986’s “Slippery When Wet” which sold over 28 million copies worldwide, the band continues to attract new fans to this day, releasing their latest album in March this year. The band’s music is a mix of rock and pop which some call “arena rock,” with a mixture of hard rock numbers and power ballads.

But to the fans it doesn’t really matter what you call it.

As long as they hear “Living on a Prayer” live, they’ll likely return home happy.

Tickets for the show start at z∏.99.

Jacek Ciesnowski

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 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 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 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.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.wilanow-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

JUNE 10-16, 2013

www.wbj.pl

23

Tech Eye

The GT70

our old cheap computer). Seeing as we had no intention of putting that computer in our mouth, much less digesting it, this intuition took us by surprise, and we summarily dismissed it.

As it turns out, we should have listened to our gut – that cheap computer turned out to be a lemon. It broke almost immediately, so we paid to have it repaired, and then it broke again.

So now for Plan B: sell the six years’ worth of post-it notes, pens and other office supplies we’ve

COURTESY OF MSI

Have you ever had a gut feeling that you just shouldn’t do something? Like that eerie premonition when you order a kebab with hot sauce and then add some maple syrup to it – you know, that sense of impending colonic doom?

Techeye feels that way at pretty much every mealtime, which is probably a sign we should lay off the maple syrup.

Something strange happened recently, though. We got that ominous gut feeling just as we were buying a new cheap computer (to replace

stolen from WBJ. That should net us, oh, approximately $3,500. And with that tidy sum of money, Techeye plans to buy a really nice new computer, such as the GT70, from Taiwan’s MSI. The GT70 is a big honkin’ gaming laptop, the kind of “desktop replacement” computer that requires a sizable desk to rest atop.

It has a 17.3” full HD monitor, a solid and relatively stylish frame, and a pretty-pretty backlit keyboard.

Inside are a 2.3GHz Core i7 processor, 16GB of DDR3 RAM, and an nVIDIA Geforce GTX670M graphics card with 3GB of GDDR5 memory.

There’s also an intriguing optional feature involving dual solid state drives, a so-called “super RAID” set up that provides a purported 800MB/s storage speed. That means faster boot times, better performance and a gigafart’s worth of pure awesome.

This kind of hardware comes at a price, though: around $2,600-2,800, to be precise-ish. Also, the GT70’s 8.6lbs (3.9kg) of heft could prove physically taxing. But we want one.

And with the money left over from our sale of pillaged office supplies,

COURTESY OF LACIE

Gut feelings and colonic doom

The LaCie Blade Runner we can also afford a fancy external hard drive to hold our growing collection of “Vladimir Putin: Warrior Princess” photos.

Behold the LaCie Blade Runner, a limited edition hard drive born of a creative partnership between hardware-maker LaCie and designer Philippe Starck. A total of 9,999 will be made, each costing $299.00.

That’s a tad pricey, but we’re drawn to the gadget. For one thing, its 4TB storage capacity can hold a lot of photoshopped Putin pics, and for another we like the way the LaCie Blade Runner’s stylized form follows function.

As Starck puts it, with just the

right amount of mumbo-jumbo, “In the Blade Runner, the warm interior electronics are encased in a mystifying shell, and the blades are the radiator that cools it down. The suspension gives space for air to circulate around the hard drive, and the metal material increases the temperature conduction.”

Honestly though, there’s another reason we like LaCie’s hard drive.

Like 93.4 percent of all geeks, Techeye is a sucker for Ridley Scott’s “Blade Runner.” If someone sold moldy, feculent fruit called Blade Runners, we’d buy some.

And you know what? We’d probably eat them with maple syrup. ●

Ever lovingly tortured your stomach with a syrup-drenched kebab? Let us know: techeye.wbj@gmail.com

To advertise in WBJ’s classifieds section, contact Agnieszka Brejwo, at (+48) 222-577-526 or abrejwo@wbj.pl