WBJ #40 2013

Between two worlds

French connection

Caught between the EU and Russia, Ukraine has to make some tough choices, and make them soon

WBJ sits down with France’s ambassador to Poland to discuss relations between the two nations and how they can be improved

8-9

WWW.WBJ.PL

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VOLUME 19, NUMBER 40 • OCTOBER 14-20, 2013 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

LOKALE IMMOBILIA

Since 1994 . Poland’s only business weekly in English

Champions of investment

COURTESY OF LC CORP

REAL ESTATE

• Expo Real report • A4 Business Park • Galeria Kazimierz

Warsaw Business Journal presents the shortlist of nominees for its Investment of the Year Awards

15-18

PZU’s plans Poland’s biggest insurer could enter the banking market and take over a Croatian peer 5

12-13

Plus:

Firing squad

• HR in focus • PKP Cargo IPO • New aviation holding?

• Warsaw recall elections • Gowin and Palikot moves

PM Tusk announced a cabinet reshuffle for November. Which ministers are on their way out?

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In this issue News . . . . . . . . . . . . . . . . . . . . . . .2-4 Business . . . . . . . . . . . . . . . . . . . .5-6 Finance & Economics . . . . . . . . . . .7 Interview . . . . . . . . . . . . . . . . . . .8-9 Opinion & Analysis . . . . . . . . .10-11 Cover Story . . . . . . . . . . . . . . .12-13 HR in Focus . . . . . . . . . . . . . . . . . .14 Lokale Immobilia . . . . . . . . . .15-18 The List . . . . . . . . . . . . . . . . . . . . . .19 Markets . . . . . . . . . . . . . . . . . . . . .20 Sports . . . . . . . . . . . . . . . . . . . . . . .22 Lifestyle . . . . . . . . . . . . . . . . . . . . .23 SHUTTERSTOCK

Up in smoke Proposals for a new tobacco directive have been softened in a win for Polish cigarette producers

5

NEWS

www.wbj.pl

WSE holds first IPO of Chinese company Last week, a Chinese company’s shares began trading on the Warsaw Stock Exchange for the first time ever. Peixin, a machinery manufacturer, issued 1 million shares at z∏.16 apiece. On its first day of trading its share price rose by some 27%.

Warsaw recall election position. But it looks like he won’t have to.

is how much the IPO of PKP Cargo may be worth if shares are sold at their maximum price.

Warsaw paradox

Warsaw Mayor Hanna Gronkiewicz-Waltz

As WBJ went to press it looked like Warsaw Mayor Hanna Gronkiewicz-Waltz would lose her post in a recall election scheduled for October 13. In one of the last polls before the election, conducted by MillwardBrown, 74 percent of those planning to vote said they would cast their ballot to remove her from office.

The survey also revealed that 32 percent of Warsaw’s residents intend to take part in the election (and an additional nine percent was con-

sidering doing so), well above the 29 percent voter turnout threshold needed for the recall election to be valid.

So the question now is what’s next for Ms Gronkiewicz-Waltz and the Civic Platform party of which she is the deputy leader. They have two options. One is to appoint an acting mayor who will govern the city until next year’s local elections. Prime Minister Donald Tusk had earlier suggested that he would appoint Ms Gronkiewicz-Waltz to that

Despite the fact that most people taking part in the recall referendum are against their current mayor, the majority of Varsovians still think she’s the best candidate for the job. In another poll, conducted by TNS Polska, 54 percent of respondents said that they would vote for Ms Gronkiewicz-Waltz in elections for the Warsaw mayorship if such a vote were held.

This could mean that Civic Platform (which also has the majority in the Warsaw City Council) could use the second option and organize snap elections that would put Ms Gronkiewicz-Waltz back in the seat she was just recalled from.

“We should make use of this potential as soon as possible,” an anonymous source from Civic Platform told daily Gazeta Wyborcza, commenting on the poll results. The newspaper also quoted a source from the Warsaw mayor’s office as saying that a snap election could take place in January.

Remi Adekoya, Jacek Ciesnowski

2.13 million is how many Poles live abroad, according to data published by daily Rzeczpospolita.

z∏.145.4 billion is by how much Poland’s public debt will be reduced in 2014 thanks to the pension reform, according to the government.

10 was how many IPOs there were on the Warsaw Stock Exchange in Q3, the second-largest number in Europe, according to PwC.

Quote of the Week “There’s nothing to be happy about, but there is also no reason for panic.”

National Bank of Poland President Marek Belka on the potential impact of the US government shutdown on the Polish economy.

Figures in focus Fighting poverty People at risk of poverty or social exclusion in selected EU member states (in %, data for 2011) 50

On WBJ.pl

* Highest in the EU ** Lowest in the EU + data for 2012

40 30

10

Un Ita ite ly dK ing do m Po la nd + Ge rm an y De Cz nm ec ar hR k ep ub lic +* *

an

ar y+ Gr ee ce

ia

0 Hu ng

With news of US government shutdown dominating the news in the last few weeks, Stratfor founder George Friedman explains how the world’s biggest economy was forced to temporarily close up shop.

Log on to WBJ.pl for Mr Friedman’s in depth analysis.

20

*

The origin of shutdown

Source: Eurostat

Calendar

October/November 17

PRCH RETAIL AWARDS GALA

Event:

The Polish Council of Shopping Centres’ Retail Awards are aimed at promoting high standards in the retail network and shopping mall sector. This year the jury will choose winners from over 40 applications.

Fabryka Trzciny Art Center, Warsaw prch.org.pl

Location: Web:

Web:

The Belgian Days are organized by the Belgian Business Chamber together with the Embassy of Belgium in Warsaw and the Economic Representations of Brussels, Flanders and Wallonia. They will feature both cultural and business events in two Polish cities.

Warsaw and Poznaƒ belgium.pl

23

INVESTING IN POLAND GALA

Event:

The Investing in Poland 2014 competition, organized by WBJ together with the leading chambers of commerce and industry, will select the Investments of the Year. This year the competition is divided into three categories: small, medium-sized and large investments. The winners will be selected by a

Azoty mulling importing gas from the US Location:

Company index Adris ............................................................5 LC Corp......................................................15 Alior ............................................................5 LOT ..............................................................5

Location: Web:

jury comprised of well-known representatives of the Polish business and investment scene.

Amber Room Restaurant, Warsaw WBJ.pl

23-24 OFFICE BUILDINGS IN POLAND CONFERENCE Event:

OCT 22 – NOV 15 BELGIAN DAYS Event:

Poland’s biggest chemical holding Grupa Azoty is in talks to start buying natural gas in the United States, the company’s CEO Krzysztof Ja∏osiƒski told business daily Parkiet. The company could have it transported through the LNG terminal in ÂwinoujÊcie, now under construction. ●

z∏.1.6 billion

ria

Amazon will launch two fulfillment centers in Poland by the end of Q3 2014, with a third one set to be constructed by mid2015. Each of the centers is expected to boost employment by 2,000 jobs, with an additional 3,000 temporary jobs per center becoming available to cope with demand during the holiday season.

Numbers in the News

Ro m

Amazon officially announces Polish investment

IN THE SPOTLIGHT

lga

The Polish government revealed the final version of its pension system reform proposal. One of the main changes is that the second pillar of the pension system, open pension funds (OFEs), will no longer be obligatory.

All employed persons will be able to choose whether to transfer 2.92% of their income to OFEs or to the Social Insurance Institution. The choice will have to be made by June 30, 2014, but changes will be allowed in 2016 and every next four years. The government expects the change to help reduce public debt by about z∏.145.4 billion, or 8.4% of the GDP in 2014.

OCTOBER 14-20, 2013

Bu

Final version of pension overhaul presented

COURTESY OF PLATFORMARP/FLICKR

2

Location: Web:

The largest and most prestigious meeting for office space market representatives in Poland. Speakers, debate moderators, and panelists include journalists, industry experts and representatives of key players on the Polish office space market.

Warsaw Marriott Hotel konferencje.nowyadres.pl/en/office-buildings-in-poland

24-25 BUSINESS SECURITY CONFERENCE Event:

Location: Web:

This year’s conference will address illegal business practices such as money laundering, smuggling and counterfeit products.

Experts from all over the Europe will meet and share their experience. This year’s special guest will be a representative from Europol, the European Union’s law enforcement agency.

Lord Hotel, Warsaw sas-ma.org/eng/

Amazon ........................................................2 MillwardBrown ............................................2 Avestus ......................................................15 Noble Securities........................................20 Bank Zachodni WBK ..................................7 Pbb Deutsche Pfandbriefbank..................15 BG˚ ..............................................................5 Peakside Capital ......................................15 Bohemia Motors........................................13 Peixin ..........................................................2 BP ..............................................................10 Pekao ........................................................20 BRE ............................................................20 PGNiG ........................................................10 Budimex ....................................................15 PKP Cargo ..............................................2, 6 Carrefour ..................................................15 Polnord ......................................................17 CBRE....................................................16, 18 Citi Handlowy ........................................7, 20 Polskie Inwestycje Rozwojowe ..................6 Coyote Polska............................................12 PwC..............................................................2 Croatia Osiguranje ......................................5 PZU ..............................................................5 Cushman & Wakefield ........................16, 18 Rabobank ....................................................5 DB Schenker Rail Polska..........................12 Remax Construct ......................................17 DCNS ..........................................................8 Resolution Property ..................................15 EADS ............................................................8 Semeko ......................................................17 Echo Investment..................................15, 17 SENER ......................................................12 Gazprom ................................................4, 10 Skanska ..............................................15, 16 GDF SUEZ..................................................13 Skoda ........................................................13 Ghelamco ..................................................13 T-Mobile ....................................................13 Globe Trade Centre ..................................15 TNS Polska ..................................................2 Grupa Azoty ................................................2 Tristan Capital Partners............................16 Grupa Lotos ................................................6 Veolia..........................................................13 Hays ..........................................................14 Huawei ......................................................13 Warimpex ..................................................16 Invesco Group............................................15 Warsaw Chopin Airport ..............................5 KGHM ........................................................20 Warsaw Stock Exchange ..................2, 6, 20 Kury∏owicz & Associates ..........................15 X-Trade Brokers ........................................20

NEWS

OCTOBER 14-20, 2013

www.wbj.pl

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Politics

Prime Minister Donald Tusk plans to replace several of his ministers A long-awaited cabinet reshuffle finally looks set to take place in November.

“As I have mentioned on several occassions, in the middle of this parliamentary term, I will propose new solutions including changes in the government,” Mr Tusk confirmed at a press conference last week.

The prime minister said he felt it necessary to inform the public that according to the government’s calculations, the sovereign debt crisis in Europe, which has put a significant drag on Poland’s economy, “is drawing to an end – and this requires a new beginning.”

Earlier, government spokesperson Pawe∏ GraÊ had announced that the PM would undertake a “review of min-

istries in November,” and that ministers will have to show progress in carrying out the goals presented by the PM in his policy announcements in 2011 and 2012 and they would also “be obliged to present their plans for the next two years.”

Rostowski rumors resurface Mr Tusk also responded to the repeated reports by news agency Reuters claiming that Deputy PM and Finance Minister Jacek Rostowski would be replaced.

“What is going on that you journalists fire Mr Rostowski once every two or three weeks?” Mr Tusk asked rhetorically.

“The incessant dismissal from office of Mr Rostowski by certain press agencies and other media outlets, always quoting anonymous sources, is in my opinion unprofes-

sional and even indecent. Let the man do his job, he still has many things to do and when he reads every month that he is about to be dismissed, he must definitely feel bad about that,” Mr Tusk said. “He does not deserve such treatment.”

Jacek Rostowski is currently the longest-serving finance minister in post-communist Poland, having held the position since 2007. In the heat of the global financial crisis in 2009, Mr Rostowski was named European Finance Minister of the Year by The Banker magazine, which is owned by the Financial Times.

However, in recent months he has come under widespread criticism for making incorrect assumptions for the 2013 budget, which later had to be amended significantly.

Apart from Mr Rostowski, the most widely criticized officials in Mr Tusk’s cabinet

COURTESY OF FLICKR/PLATFORMRP

Cabinet reshuffle in November

Prime Minister Donald Tusk include Health Minister Bartosz Ar∏ukowicz, Education Minister Krystyna Szumilas and Minister of Science and Higher Education Barbara Kudrycka.

Interior Minister Bart∏o-

miej Sienkiewicz has also come in for some heavy criticism in recent months, however, he was only appointed in February of this year and thus it is unlikely Mr Tusk will replace him just yet.

Other ministers that have been mooted as possible victims of the reshuffle include Environment Minister Marcin Korolec and Sports Minister Joanna Mucha.

Remi Adekoya

EU law

Palikot, Gowin, make their move(ment)s

EP: shale gas projects must pass strict environmental tests

Two major political figures are making waves ahead of European Parliament elections next year

New EU rules might hinder shale gas exploration in Poland

The conservative former Justice Minister Jaros∏aw Gowin and Janusz Palikot, leader of a socially liberal party, are shoring up their political positions a year ahead of European Parliament elections, with a view to gaining momentum before parliamentary elections in Poland in 2015.

Mr Palikot launched what he is calling a “new” party at a convention in early October.

The party will be called Twój Ruch, which can be translated as both “Your Movement” and “Your Move.” It will include the members of his previous party, “Ruch Palikota” (Palikot’s Movement), but several other notable left-wing politicians will join, including MEP Marek Siwiec, who will become vice-president of the grouping.

Mr Palikot said that the party will focus on action necessary for the Polish economy to expand. He stressed the need to build Poland’s knowledge-based economy and said that radical reform of the country’s pension system was required.

Mr Palikot is clearly look-

SHUTTERSTOCK/COURTESY OF JUSTICE MINISTRY

Politics

Janusz Palikot (left) and Jaros∏aw Gowin (right) ing to revive the popularity of his grouping. After coming in third in the 2011 parliamentary elections, the most recent polls show his party would not break the 5 percent threshold needed to receive seats in the lower house of parliament.

Republicans join forces with Gowin On the other side of the political spectrum, Mr Gowin signed a cooperation agreement with the Republicans Association, headed by independent MP Przemys∏aw Wipler. “We have similar interests and values: entrepreneurship and the family,” said Mr Gowin at a press

conference called to make the announcement.

The agreement came a week after Mr Gowin signed a similar cooperation deal with the Poland Comes First party.

The former justice minister, with strongly conservative leanings, quit Civic Platform in September this year after losing a leadership battle to Prime Minister Donald Tusk whom he accused of having veered the party to the left.

He has since been traveling around Poland in a bid to shore up support for a new socially conservative, pro-business political initiative.

Mr Gowin claims that he

and his allies are not creating a new party, but rather a social movement. “One day the people who are part of this movement will decide whether to have some kind of political representation, whether to create a voting list to the European Parliament and in local elections,” Mr Gowin said.

Two other conservative politicians have also quit the ruling party in recent months: Poland’s first black MP John Godson and MP Jacek ˚a∏ek.

They are also part of Mr Gowin’s political initiative.

Remi Adekoya, Jacek Ciesnowski

The European Parliament voted narrowly in favor of proposed EU legislation that forces companies to carry out in-depth environmental impact studies before they begin shale gas and oil projects.

The proposal passed with 332 votes for, and 311 against.

MEPs will now have to begin informal consultations with the EU Council, representing the EU’s 28 national governments, on the common text needed for the proposal to become law.

Extracting gas from shale rock requires fracturing rock deep below the earth’s surface to remove the gas. The technique, known as fracking, involves shooting a mixture of water, sand and chemicals into shale rock to release the gas.

The practice is controversial, and some studies have shown it can be hazardous to the environment. In the EU, France has banned all fracking projects altogether, while countries that hope to use shale gas to diversify their energy mix, such as Poland, complain that more red tape could curb or even halt the development of shale gas and investment in the sector.

“Adopting the wrong solu-

tions may mean that Europe will be the only part of the world where shale gas will not play a significant role,” MEP Konrad Szymaƒski, a member of Law and Justice, said.

“Negotiations in the (EU) Council should now be conducted in such a way as to remove this from legislation,” MEP Bogus∏aw Sonik, a member of the Civic Platform party, added in a unique moment of unity between Poland’s major parties.

However, environmental groups and left-wing European lawmakers praised the new rules.

“While this would not prevent permits from being granted, it would ensure a basic standard of assessment and public participation,” said Sandrine Bélier, a French MEP and spokesperson for the Green Party.

“This will help prevent risky shale gas projects being bulldozed through in spite of environmental concerns and public will,” she added.

As of September 1, there were 105 valid exploration licenses in Poland. So far 48 exploration boreholes have been drilled. Altogether the licensees plan to drill 335 boreholes by 2021.

Jacek Ciesnowski, Kamila Wajszczuk

4

NEWS

www.wbj.pl

OCTOBER 14-20, 2013

Regional politics

Tug of war for Ukraine intensifies ahead of Vilnius summit President Bronis∏aw Komorowski and his Ukrainian counterpart Viktor Yanukovych met in Kraków last week to discuss bilateral cooperation and the prospects for Poland’s neighbor to sign an association agreement with the European Union at the planned Eastern Partnership summit in Vilnius in November.

Poland and Ukraine are “working hard, and, it seems, in a fruitful way” in view of the upcoming summit, Mr Komorowski said after meeting Mr Yanukovych. “We discussed removing the remaining obstacles to the success of the Vilnius summit,” he added in a thinly veiled reference to the continuing detainment of Yulia Tymoshenko, a former prime minister of Ukraine.

The EU is demanding that Ukraine release Ms Tymoshenko, who was sentenced to seven years in jail for allegedly acting against nation-

al interests when she signed an energy deal with Russia in 2009. Brussels believes that Ms Tymoshenko was put behind bars for political reasons.

In early October special envoys from the European Parliament – former EP President Pat Cox and former Polish President Aleksander KwaÊniewski – appealed to Mr Yanukovych to pardon Ms Tymoshenko.

After his meeting with Mr Yanukovych, President Komorowski pointed out the importance of the bilateral relationship for Poland. “Polish-Ukrainian relations and the prospect of Ukraine getting closer to the EU are strategic issues for Poland,” he said.

Mr Komorowski also announced that he and Mr Yanukovych had signed a Poland-Ukraine cooperation plan that would last until 2015.

The plan assumes “an opti-

mistic scenario of cooperation between Poland as an EU member and Ukraine as an EU-associated country,” Mr Komorowski said.

Sticks and carrots The Kremlin, meanwhile, has repeatedly warned Ukraine against signing the association agreement with the EU. Ukraine is a strategically important border country for Russia and a former Soviet republic.

Instead Moscow wants Kiev to join its Customs Union, which includes Belarus and Kazakhstan (Armenia has also announced it will join). But although Ukraine has observer status in the trading bloc, it has stated it does not plan to take on full membership.

During a September meeting of the Valdai Club, a gathering of high-level Russian officials and foreign political observers, Russian president Vladimir Putin said he is worried that European goods could enter Ukraine – free of import duties – and then be reexported to Customs Union

COURTESY OF PREZYDENT.PL

The presidents of Poland and Ukraine met last week hoping to ensure that Kiev signs an association agreement with the EU in November. Russia has other ideas

President Viktor Yanukovych of Ukraine (left) and President Bronis∏aw Komorowski of Poland (right) countries, flooding the market and undercutting domestic producers.

“That’s why we warn in advance, we say: ‘Listen, we understand everything, if this is your choice, then do it, but keep in mind that we would have to somehow protect our market, to introduce protective mechanisms,’ ” said Mr Putin.

“We say this to you in advance, clearly and frankly,” he added.

Last week, Mr Putin adopted a different approach, stating that Russian banks have put together a loan package of $750 million for Ukraine and that Russian oil and gas giant Gazprom has been pumping gas into Ukrainian underground storage facilities at a discounted price.

Until very recently, the gas price for Ukraine was around $400 per thousand cubic meters, and now is at $380-

$390, Mr Putin said.

“Gazprom gave a discount. ...

We are working together, we are helping our Ukrainian partners, our friends,” he added.

If Ukraine does decide to sign the association agreement with the EU, the European Parliament will have the ultimate say on whether the bloc will sign on as well.

Remi Adekoya, John Beauchamp

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BUSINESS

OCTOBER 14-20, 2013

www.wbj.pl

5

Banking

Reports are increasingly appearing regarding moves by Polish insurance giant PZU into the banking sector. Two reports last week, one from business daily Puls Biznesu and the other by Reuters, suggested that the firm was interested in buying Bank BG˚, the Polish arm of Netherlands-based Rabobank.

Reuters reported that PZU

was interested in teaming up with Polish-based lender Alior to buy BG˚, while Puls Biznesu suggested PZU could take over both banks and merge them.

PZU was said to have been interested in buying Alior last year. The bank then carried out its IPO instead, but PZU may still be interested. In accordance with Alior’s IPO prospectus, 30 percent of shares belonging to the Carlo Tassara holding needs to be sold by the end of 2013. Several media have reported that PZU is interested in buying that stake.

PZU is also working to continue expanding its core insurance business. The Polish company is one of the two bidders still in the running for Croatia Osiguranje, the country’s biggest insurer, with a market share of around 35 percent. The Croatian government, which controls about 80 percent of Croatia Osiguranje, wants to retain between 25 and 30 percent of the company’s shares after the sale.

PZU’s only competitor for Croatia Osiguranje is Adris, a local tobacco producer and tourism group.

According to the Croatian

PZU headquarters, Warsaw government, PZU’s offer was €900.9 per share plus an additional €50 million in a capital increase for the company. Adris is offering €790.27 per share and a €130

EU Regulations

European Parliament waters down new tobacco directive The stakes are high for Poland, one of the EU’s biggest producers of tobacco and related products

Good for Poland?

SHUTTERSTOCK

The European Parliament voted to significantly water down the European Commission’s proposal for a new Tobacco Products Directive (TPD). The directive, as proposed by the EC, would have brought about some of the toughest anti-tobacco legislation in the world. According to the Commission’s proposal, cigarette packages would have had to be at least 75 percent covered by graphic health warnings, while menthol-flavored and slim cigarettes would have been banned.

But the directive that left the European Parliament last week is much less strict. The percentage of package space covered by warnings was lowered to 65 percent and slim cigarettes will not be banned at all. Flavored cigarettes will

curb tobacco use in the bloc, especially among the youth, as well as bring the current, 10-year-old law up to date with the latest health studies and technological developments.

The tobacco industry in Poland generates up to z∏.20 billion annually in tax revenue be banned, but only after an eight-year waiting period, instead of the three years proposed by the Commission.

Moreover, products containing nicotine, such as electronic

cigarettes, won’t be regulated as medications as had been proposed by the EC. Each year 700,000 Europeans die from smoking-related diseases. The TPD aims to

Poland was one of the opponents of the proposed laws (along with the Czech Republic, Romania and Bulgaria).

The country is one of the biggest tobacco producers in the EU and generates up to z∏.20 billion annually in tobacco-related tax revenue. As much as 40 percent of all menthol cigarettes in the EU are made in Poland. The Polish Chamber of Commerce (PIH) has warned that the directive could wipe out one-third of Poland’s tobacco market.

The draft directive will now be consulted within the Council of the European Union.

EU officials hope to pass the legislation before May 2014.

Jacek Ciesnowski

million capital injection.

Altogether, Adris’s bid is worth €232.4 million while PZU’s bid would amount to €171.5 million, according to local media.

The Croatian government will analyze the offers and then ask the companies to submit their final bids.

Kamila Wajszczuk, Jacek Ciesnowski

Gov’t considers aviation holding

COURTESY OF LOT

The Polish insurance giant wants to enter the banking business and make a major takeover in Croatia

COURTESY OF PZU

PZU’s grand plans

The proposal is a bid to increase the value of LOT

The Ministry of State Treasury and the Ministry of Transport are mulling the creation of a holding firm called Polish Aviation Holding (PHL) that would include national airline LOT. The group would also include the operator of the Warsaw Chopin Airport and service companies. It could be created by the summer of 2014.

“We are considering various options, which would allow for as much synergy as possible between aviation companies,” Deputy Treasury Minister Rafa∏ Baniak told Rzeczpospolita.

“PHL is one of them.”

“It’s an interesting idea,” added Transport Minister S∏awomir Nowak. “We’re working on a solution that would

save LOT from the worst-case scenario,” he explained, leaving no question as to why such an idea is being considered.

Putting the cash-strapped air carrier in a holding with companies that are profitable would help cover airline losses and make it easier for the Treasury to sell its stake in LOT in the long run.

The infrastructure portion of the holding, worth about €500 million, would not be eligible for sale. Other entities within PHL could be privatized. A minority stake in the holding could also be sold in an offering for individual investors. In total, the estimated value of the holding would add up to €2.5 billion. KW, JC

6

BUSINESS

www.wbj.pl

Stock exchange

OCTOBER 14-20, 2013

Oil extraction

PKP Cargo looks to State-controlled SPV raise z∏.1.6 billion in IPO reveals first project

Freight operator PKP Cargo’s IPO is scheduled to take place on October 31 cent of the shares offered and individual investors will be allowed to buy between 15 and 20 percent. The remainder will be sold to institutional buyers.

Already, the European Bank for Reconstruction and Development has said it will buy a stake of between 5 and 7.5 percent in PKP Cargo (amounting to between 10 and 15 percent of the shares on offer).

The freight operator wants to use the funds raised in the IPO to repay some of the debts racked up by its parent company. The firm also said that it plans to pay 35-50 percent of future profits in dividends.

The company’s CEO ¸ukasz Boroƒ has said that

PKP Cargo is looking for foreign acquisitions as well.

Besides Poland, the freight operator is currently present in the Czech Republic, Hungary, Slovakia, Austria, Germany and Belgium.

PKP Cargo is the largest rail freight operator in Poland, with a 60.3 percent market share in terms of freight turnover, and the secondlargest in the EU, with an 8.5 percent market share. In H1, the company saw its net profit drop to z∏.76.8 million from z∏.136.6 million a year earlier.

The IPO is subject to regulatory approval.

Kamila Wajszczuk, Jacek Ciesnowski

Polskie Inwestycje Rozwojowe (PIR), a special purpose vehicle established by the government as one of the operators of the Polish Investments program, has announced that it will provide z∏.563 million for the development of a Baltic Sea oilfield

by Poland’s second-largest refiner, Grupa Lotos.

The development of the oilfield, expected to cost z∏.1.6 billion total, is the SPV’s first project within the program, which was announced last year by Prime Minister Donald Tusk as a measure to boost Poland’s sagging economy. The remainder of the investment will be financed by Lotos and by commercial banks.

PIR and Grupa Lotos subsidiary Lotos Petrobaltic will establish an SPV to manage the project, into which the license and all assets related to the oilfield, called B8, will be transferred. Development work on the B8 field has so far been

financed by Lotos from internally generated funds.

The SPV will be a wholly owned subsidiary of Lotos Petrobaltic and will carry out the remaining work on the B8 field. This includes the conversion of Lotos Petrobaltic’s drilling platform into a production unit, the preparation of sub-sea infrastructure and the drilling of the last injection wells before the field comes onstream.

“The investment in the B8 development project has an average risk exposure profile, as PIR only invests in low- or

medium-risk projects, which usually fall within the realms of infrastructure or private equity funds,” said Mariusz Grendowicz, president of PIR. The launch of commercial production from the B8 field is planned for the end of 2015.

Lotos estimates the field’s reserves at 3.5 million metric tons of crude oil.

Zbigniew Paszkowicz, president of Lotos Petrobaltic, said he expects the field to produce approximately 220,000 tons of crude oil per year.

Remi Adekoya

COURTESY OF LOTOS

Railway freight transportation firm PKP Cargo’s IPO could be worth as much as z∏.1.6 billion when it debuts on the Warsaw Stock Exchange on October 31. Last week, the firm published its issue prospectus and launched the offering.

State-owned railway group PKP is selling 21,669,007 shares (50 percent minus one share) in PKP Cargo, at a maximum price of z∏.74 apiece. If the shares are sold at that price, it would make the debut the largest on the WSE so far this year.

Book-building for institutional investors started on October 8 and will be completed on October 22. Subscriptions for institutional investors are scheduled for October 921. The final share price will be announced on October 22.

According to the company’s issue prospectus, PKP Cargo employees will receive 10 per-

Polskie Inwestycje Rozwojowe will co-finance a Baltic Sea oilfield project to the tune of z∏.563 million COURTESY OF PKP CARGO

If shares fetch the maximum set price, the debut will be the largest on the Warsaw Stock Exchange so far this year

The investment will partially finance oil extraction in the Baltic Sea

FINANCE & ECONOMICS

Central bank

COURTESY OF NBP/FLICKR

The rate-setting council loses a hawk.

President Komorowski is expected to name a replacement soon

Zyta Gilowska Trzaska-Wieczorek said. “If a good candidate appears, the successor will be named.”

Polish treasury bond yields declined by four basis points to 3.02 percent on October 7, their lowest level since August 13 this year, following the resignation.

The z∏oty depreciated for a second day, this time by 0.1 percent, to 4.2047 against the euro.

“Gilowska was one of the

7

Labor Ministry: Unemployment lingers at 13% in September

Gilowska resigns from Monetary Policy Council

Former Finance Minister Zyta Gilowska has resigned from the National Bank of Poland’s ratesetting Monetary Policy Council (RPP), and her resignation has been accepted by President Bronis∏aw Komorowski.

Ms Gilowska had been a member of the council since February 2010, after being appointed by then-President Lech Kaczyƒski. She had earlier been a member of parliament and minister of finance in the governments of Kazimierz Marcinkiewicz and Jaros∏aw Kaczyƒski.

A spokesperson for President Komorowski was quoted by the Polish Press Agency as saying that a replacement would likely be appointed before the legally mandated three-month deadline to name one.

“I think that the threemonth deadline won’t be fully utilized,” Presidential Chancellery spokesperson Joanna

www.wbj.pl

most hawkish members of the [RPP], so this change may potentially mean a tilt of balance of powers in the council toward more dovish monetary policy,” Bank Zachodni WBK economists wrote in a comment. “Theoretically, this can imply that rates may remain at the current all-time low level a bit longer.”

KW

Poland’s registered unemployment rate remained at 13 percent in September, according to an estimate published by the Ministry of Labor and Social Policy. The number of unemployed persons decreased by 900 from August and amounted to 2,082,000.

According to data from the Central Statistical Office (GUS), the registered unemployment rate declined to 13 percent in August compared with 13.1 percent in July.

Deputy Labor Minister Jacek M´cina said that with the help of budget funds, unemployment may remain below 14 percent at the end of this year.

“If we manage to secure the consent of the Finance Minister for using z∏.0.5 billion in funds from the Labor Fund for a [labor market] intervention,

then the chances are high that unemployment at end-2013 will be below 14 percent,” he told the Polish Press Agency.

KW

The autumn flattening Poland’s unemployment rate, September 2011-September 2013 14.5 14 13.5 13 12.5

* Labor Ministry estimate

12 11.5 Se p.

Oc ’11 t.

No ’11 v.

De ’11 c.

Jan ’11 .

Feb ’12 .

Ma ’12 r.

Ap ’12 r.

Ma ’12 y Jun ’12 .

Jul ’12 .

Au ’12 g.

Se ’12 p.

Oc ’12 t.

No ’12 v. ’ De 12 c.

Jan ’12 .

Feb ’13 .

Ma ’13 r.

Ap ’13 r.

Ma ’13 y Jun ’13 .

Jul ’13 .

Au ’13 g Se . ’13 p. ’13 *

OCTOBER 14-20, 2013

Source: Central Statistical Office, Ministry of Labor

IMF, Citi raise forecasts for Poland’s GDP growth in 2014 Last week the International Monetary Fund and Citi Handlowy both raised their forecasts for Poland’s economic growth next year.

The IMF said that while Poland’s economic growth will amount to 1.3 percent this year, it will accelerate to 2.4 percent in 2014. In its previous forecast, the IMF saw 2014 growth 2.2 percent. The fund said that

GDP growth will be fueled by an increase in domestic demand in the region. On the risks side, the key factor is euro zone recession.

The economic research team at Citi Handlowy was even more optimistic. Citi has raised its forecast for Poland’s GDP growth in 2014 from 2.8 percent to as much as 3.1 percent, the bank said in a press

release.

“Our 2014 GDP forecast (2.8% y/y) has been more optimistic than the market for some time already but given recent data releases as well as additional fiscal space (resulting from changes in the pension system) we believe chances of growth accelerating even more are high,” Citi economists KW wrote.

8

INTERVIEW

www.wbj.pl

OCTOBER 14-20, 2013

European Union

France, Poland look to open new chapter in relations Ewa Boniecka: French-Polish cooperation is being renewed after a period where relations had been less warm than they traditionally are.

How can the relationship be strengthened?

Pierre Buhler: First of all, I want to emphasize that while there was a lukewarm period in our bilateral relations, we never stopped cooperating.

We had very good relations during the 1990s, which slowed down a little in the early 2000s, when there was a difference in the attitude towards the conflict in Iraq.

Poland went to war there, along with the United States, but we decided that there was no evidence of weapons of mass destruction in Iraq: history has shown who was right.

There were a number of episodes which probably did not help boost our relations, but I want to stress that they never ceased. Our cooperation at the working level has been solid. We supported the Polish presidency of the Council of the European Union in the second half of 2011, and earlier we cooperated with the Polish prime minister at the time, Kazimierz Marcinkiewicz, in his efforts to obtain €67 billion from the EU budget for Poland.

Now, while we agree there is an opening of a new chapter in our relations, the situation is as follows: We have a very strong and warm rapport between our presidents as

well as between our prime ministers. There are a lot of ministerial visits and the rapport is extremely good between our ministers of defense, for example. The foreign affairs ministers of both countries were invited to participate in ambassadorial meetings: the French minister took part in such a meeting of Polish ambassadors in Warsaw in 2012, and Polish Foreign Minister Rados∏aw Sikorski participated in the meeting of French ambassadors in Paris in August this year.

I want to explore all the existing opportunities for building a framework of our relations. I think that we must institutionalize these relations with a number of regular meetings, consultations and contacts on a working level. To this end, we have proposed a program which provides a description of what fields we have to work in together and which structures are needed to move forward. We have established such structures with Germany which operate at all levels, and they provide substance and continuity in our cooperation which is extremely fruitful for French-German relations. There was a lack of such structures in PolishFrench relations, so now we have to move forward with them. At present, we are supposed to have inter-governmental consultations every year, while in reality the last

COURTESY OF THE FRENCH EMBASSY IN POLAND

Pierre Buhler, France’s ambassador to Poland, sits down with WBJ to talk about the opening of a new chapter in traditionally friendly PolishFrench relations, the dynamism in bilateral contacts and close cooperation within the European Union

“Mutual trade between Poland and France is too small, so it is our duty to change it.”

French Ambassador to Poland Pierre Buhler such consultation happened in 2009, so it’s a gap we have to fill.

We have to have continuity to build a solid relationship and to make it immune from the ups and downs of politics and the switching of priorities. We think that we have enough long-lasting common interests to have institutionalized relations.

France and Poland are now developing close cooperation in the fields of defense and security, can you elaborate on this?

Let me say that our cooperation in defense has a very old tradition, going back to the Napoleonic era. Our military cooperation stopped when we became separated by the Iron Curtain. As soon as Poland regained its freedom, we undertook very active

cooperation in defense matters.

Today we have very diverse cooperation: in Afghanistan, in the EU mission to Mali, we are conducting strategic dialog which has been boosted by the present warm atmosphere in our relations. In November we will cooperate in NATO’s military “Steadfast Jazz” exercise, conducted for the first time in Poland and some other eastern members of NATO, in which France will be the biggest participant, providing 1,200 soldiers.

Both countries are reliable allies in the framework of collective NATO defense and we look forward to cooperating with Poland to move the European defense and security agenda forward at the EU summit in December.

Poland has adopted a longrunning program of modernizing its armed forces. What could France’s role be in this process?

Let me elaborate on some broader aspects of FrenchPolish cooperation. Our minister of defense has decided to move Poland from the French sub-department for armaments, which deals with customers of France, to another department where we are conducting military cooperation with Germany, the United Kingdom, Italy, Spain and the US. This also shows an upgrade in the level of our military cooperation with Poland. Now that Poland is our partner, not a customer, it will be participating in sharing military technology, research programs and the exchange of military practices. It is a very decisive

change in our approach and valuable for boosting Poland’s role in shaping the defense policy of the European Union.

There are also developments in the technical aspects of military cooperation. A number of European and French companies are interested in cooperating in the field of producing helicopters. There was an offer made by the European EADS consortium, with an agreement signed to open industrial plants for helicopter production in ¸ódê and D´blin. This means that Poland will join the core of the European defense industry in the domains of production, research, and the export of that equipment.

The French state-owned company DCNS has also offered the Polish Navy ship-

INTERVIEW

OCTOBER 14-20, 2013

yard in Gdynia cooperation in the production of “Scorpene” submarine ships. It has also offered to share the sophisticated technology and to develop long-lasting production for export. Such a contract would create 1,000 highly skilled jobs within a decade and boost the production of naval equipment in Poland. I have named here only a few aspects of military cooperation between Poland and France, but it shows its importance in our relations.

There is a lot of room for improvement in our bilateral economic relations. Why are Polish-French trade relations so modest?

Our economic relations are modest, but significant nonetheless. The value of our mutual trade amounts to €15 billion, while France is selling less to Poland than Poland to France. This has partially been the result of the economic crisis, which has affected consumption, and French exports have also suffered.

Another explanation is that Poland has changed its legal conditions for selling pharmaceuticals in its domestic market and France, which holds a very strong position in pharmaceutical production and export, bore the brunt of it.

Maybe some of our goods are not well-suited to the Polish market, but I agree that our mutual trade is too small, so it is our duty to change it.

But you should not forget that France is the thirdbiggest foreign investor in Poland and the value of French outstanding direct investments amount to €20 billion, with 800 French companies operating in Poland, providing 150,000 jobs.

Is the French market difficult for Polish businesses to enter?

We welcome Polish businesspeople, investors, service companies and workers in France. What we expect is that those companies and workers submit to French law.

We are protective towards workers, we have minimumwage regulations and welldeveloped social benefits.

But that creates heated competition on our market, so maybe it is not easy to find a place in it.

France and Poland have stressed the need to encourage economic growth in the European Union. How do you see our countries’ cooperation in fighting the economic slowdown?

Nobody is closer in the EU than France and Poland when it comes to moving forward the agenda of economic growth. Our governments decided to act together on this and the outcome was the

EU budget and financial framework approved in February, as well as the following agreement of providing €73 billion for growth incentives.

In the same spirit, we were able to secure payments related to agricultural policy.

France and Poland have a similar approach to strike a balance between growth promotion and budget consolidation.

While the euro zone is integrating, a two-speed European Union has become fact.

How do you view the further development of this situation?

The stress on economic growth is one of the ways to fight the present recession in the EU. Budget consolidation is another method, while we are also working on the process of fixing the monetary union with a number of tools such as the banking union. What concerns the members of the euro zone has a huge influence on noneuro zone members, so France and Poland point to the need to take due consideration of non-euro zone members as far as the whole development of the EU is concerned.

Both countries favor deeper integration of the EU. In what way can France and Poland cooperate in pushing the idea of deeper integration?

Both countries certainly favor larger and deeper integration of the European Union. But what does that mean? For France it means building economic and political union.

But some European societies are somewhat lukewarm towards building a deeper European Union; they have very strong feelings towards their national states.

There are always parties and individuals who use the politics of fear to gain support, but what our two governments say and do is that they are for further integration. The euro zone is one aspect of this, which is already proceeding with integration, while another one is defense and security. We think that the European Union has to take care of its own security as we see that our American friends are looking towards other regions and rightly so – there is no need to complain about that.

But they have asked the Europeans to take on more responsibilities for themselves. This means further integration in the fields of security and defense, the development of tools to act in crisis situations, and the anticipation of dangerous situations.

These tools are being established and the December EU summit will address

these issues and ways of promoting further integration.

There are other matters we have to tackle together, for example climate change.

But the European Union still does not speak with one voice on foreign policy.

It is our common aim to speak in unison on foreign and security policy and we are all committed to that ideal and pursue such a view.

You are right that it is not a reality these days, but you should look at it from a historical perspective.

Foreign policy is perhaps the last field that has been subject to integration. It is a process, and the European External Action Service – EEAS – has been in place for only two years. It cannot be expected to become a strong mechanism overnight. In a crisis situation there is often no time to consult all member states. Governments react under the pressure of current events, and furthermore they play to domestic constituencies.

This is a democratic game, so I doubt whether we will be able to build a common foreign policy very soon.

National interests are diverse, and countries have various bilateral relations with other countries. If you look at EU membership, there are two nuclear powers, not every EU member belongs to NATO, some are formally neutral.

When you realize the sensitivity of some members over the idea of sovereignty, that some societies are pacifist, others are more eager to take on international responsibility, it is a miracle that we all make up one community.

We should not judge the European Union by its many expressions of diversity, but primarily see the unique value in the fact that we were able to build such a community and that we have achieved so much over the years, bringing together 28 countries with such different backgrounds. It is a truly historic process.

On a personal note, you have spent a lot of time in Poland and have even written a book on the history of the country.

What are your impressions of Poland now?

I was here as a young second secretary in our embassy during the 1980s and when I see what has happened in Poland I am very optimistic. It has been an overwhelming evolution since those years and I am deeply moved by how the Polish people’s dynamism and wisdom has provided a path for the liberation of the country and this part of Europe. So I am very proud now to serve as the ambassador of my country to a free and democratic Poland. ●

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9

10

OPINION & ANALYSIS

www.wbj.pl

OCTOBER 14-20, 2013

Poland’s continuing quest for a better natural gas deal Stratfor

P

oland is one of the Central and Eastern European countries striving to diversify its natural gas supplies, particularly to wean itself from Russia. Several factors will allow Warsaw to negotiate with Moscow from a relatively strong position over the coming years, making Poland one of the countries most likely to get better contractual terms on natural gas imported from Russia.

On October 7, Polish Economy Minister Janusz Piechociƒski said, “We hope that in Central and Eastern Europe the time has come to talk with Gazprom about the renegotiation of gas rates because the market is becoming more friendly to recipients than to suppliers.” He indicated that Poland would want to renegotiate natural gas prices but did not specify when such negotiations would start.

In November 2012, Poland’s state-controlled oil and natural gas company, PGNiG, negotiated a retroactive discount of more than 10

percent (the exact discount was not disclosed) on its long-term contract with Gazprom, which runs until 2022. Poland now pays around $525 per thousand cubic meters – still roughly 30 percent higher than the average on the continent. Warsaw is looking to even the playing field.

The Polish economy minister’s comments came just four days after EU Competition Commissioner Joaquin Almunia stated that the EU Commission is preparing the next steps in the investigation against Gazprom launched last year, which covers the company’s operations in Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia, Hungary and Bulgaria. The European Union is investigating whether Gazprom hindered the flow of natural gas across countries by dividing the markets, prevented the diversification of gas supplies and imposed unfair prices by fixing the price of Russian gas to oil.

Central and Eastern European countries advocate for better integration of natural gas infrastructure with the rest of Europe, and also aim to strengthen their positions in negotiating natural gas contracts with Russia by having the European Union apply pressure on Gazprom as a bloc. Lithuania is a prime example of a country trying to use a combination of domestic diversification efforts and EU backing to weaken its dependence on Russia.

SHUTTERSTOCK

“A number of factors allow Poland to negotiate with Russia from a position of relative strength.”

A shale gas drilling site near Lublin, southeastern Poland Because of the logistical difficulties in securing alternative supplies – such as a lack of pipeline connections or liquefied natural gas import terminals to import non-Russian natural gas – the pressure the European Union can put on Gazprom is limited. However, a number of factors allow Poland to negotiate with Russia from a position of relative strength.

Poland’s diversification efforts Because of its domestic coal reserves, Poland is a relatively energy-independent country. However, when it comes to natural gas, Poland relies on imports. Two-thirds of Poland’s natural gas demand is met through imports, about 80 percent of which come from Russia (which supplies around 32 percent of the European Union’s total natural gas imports). According to a statistical review by BP, Russia supplied 9 billion cubic meters of the 16.6 billion cubic meters of natural gas Poland consumed in 2012. Poland is trying to lessen Russia’s importance as a natural gas supplier through a number of diversification efforts.

Poland is one of the strongest proponents of shale gas exploration in Europe. Warsaw hopes to profit

from a boom in its shale gas sector similar to the one the United States experienced. However, although shale gas is being extracted at low quantities at a Polish test well, the sector’s long-term prospects remain uncertain due to geological, infrastructural and legislative hurdles.

Poland also has more concrete and shorter-term diversification plans. At the end of 2014, a liquefied natural gas import terminal on Poland’s Baltic Sea coast is expected to be completed and will have an initial import capacity of 5 billion cubic meters per year (depending on demand, it could be expanded to 7.5 billion cubic meters).

Although there are still strong physical and contractual limitations, Poland has also been diversifying its imports of piped natural gas through interconnectors to Germany and the Czech Republic (the import capacity from Germany has been around 1.5 billion cubic meters per year since 2012, and the annual import capacity from the Czech Republic is 0.5 billion cubic meters). Warsaw has also used so-called virtual reverse flows, in which the natural gas flow is not actually reversed but supplies requested in Poland are subtracted from the natural gas flowing on to Germany. Russia is still the supplier

of this natural gas, but purchasing supplies from companies other than Gazprom allows Poland to benefit – particularly from the lower prices Russia offers to German companies.

Ukraine is currently applying a similar strategy to escape its contractual terms with Russia.

Another factor that bolsters Poland in negotiations with Russia is its position as a transit state, which could be strengthened in the future.

Poland and Russia already co-own the nearly 700-kilometer (435-mile) Polish section of the Yamal gas pipeline, which has an annual capacity of 33 billion cubic meters and runs from Russia through Belarus and Poland to Germany. Russia on several occasions has considered building a natural gas pipeline called Yamal-II, which would run through Belarus and Poland into Slovakia.

The goal for Russia is to have other transit diversification options for natural gas sales to Europe and, more specifically, to bypass Ukraine.

When Moscow last addressed the idea in April, Warsaw was quick to dismiss the plan, but that does not mean the idea has been abandoned.

Poland faces a dilemma: On the one hand, Yamal-II would weaken Ukraine, which Poland is interested in drawing closer to the West, but on

the other hand the pipeline would increase Warsaw’s leverage with Moscow as a transit state and bring in investment.

Russia’s position As the economic crisis lingers in Europe, the possibility of Russian investment in domestic energy sectors will become more enticing, especially if the European Union begins to have difficulties financing energy projects through the joint EU budget. Thus, the relative economic weakness on the continent gives Moscow an opportunity to maintain its strong position in Europe’s energy sector, even if it agrees to further price reductions on natural gas.

Russia is aware that it will likely face greater competition in Europe in the future as liquefied natural gas and shale gas become more available. Price reductions undermine the economic viability of diversification efforts in other countries and therefore serve Russia’s long-term goal of maintaining a large market share in Europe. ● This edited version of “Poland’s continuing quest for a better natural gas deal” is reprinted with permission of Stratfor Stratfor.com

OPINION & ANALYSIS

OCTOBER 14-20, 2013

www.wbj.pl

11

The drawbacks of forward guidance Marcel Fratzscher

The US Federal Reserve headquarters, Washington, DC SHUTTERSTOCK

T

he nomination of Janet Yellen to succeed Ben Bernanke as Chair of the US Federal Reserve comes at one of the riskiest moments in the recent history of the Fed. The Fed’s announcement in May that it might start tapering its long-term asset purchases surprised many central bankers, and triggered a sell-off from markets worldwide. But some of the good news about America’s economy was bad news for financial markets, because investors considered the Fed’s potential policy tightening in response to such news to be more relevant than the news itself.

Then, last month, when the Fed postponed its withdrawal from socalled quantitative easing, markets quickly turned euphoric. Indeed, investors today appear less concerned about the real economic story than about the Fed’s interpretation of it.

This underscores an important risk that Ms Yellen must now reckon with as she guides US monetary policy: In the longer run, the dominance of the Fed’s views in the market may cause serious economic harm.

The problem for the Fed and other central banks lies not in monetary

accommodation, but in their communication strategies. Their extensive promises, assurances, and pre-commitments have lured market participants into a false sense of security. This has induced market players to take on the wrong types of risk, leaving them poorly prepared for adverse changes in the economy and posing a broader threat to long-term financial stability.

Central banking is all about managing market expectations. Monetary authorities have, in recent years, made the way they communicate – about their thinking and possible actions – their primary tool to guide markets and anchor expectations. This is especially true of so-called forward guidance on policy rates – and increasingly so as central bankers’ scope for policy action has become more limited.

Major risks Unfortunately, major risks and costs arise from over-reliance on communication strategies. Because the voice of central banks has become so dominant in financial markets, price movements have come to reflect responses to their statements and actions, rather than to changing economic and finan-

cial realities.

For example, when policymakers promise to act if certain risks arise, markets inevitably discount the impact of such risks. In May, Mr Bernanke issued an unusually stern warning about excessive risk-taking in financial markets. Yet investors have pushed equity indices to all-time highs, despite the feeble and uncertain recovery, while the VIX index, a proxy for investors’ perceptions of risk, fell to levels not seen since the boom years of 2005 and 2006.

A second consequence of the dominant role of central banks’ communications in financial markets is that it crowds out private sources of information, thereby depriving the monetary authorities themselves of an invaluable, independent view of trends that they need for sound policy making.

Worse, private actors no longer see the need to collect, analyze, or deploy their own information to the extent that they once did.

A third drawback is that when central banks are seen to give misleading assurances and to over-commit to certain outcomes, they risk losing their most important asset: their credibility.

What will the Fed do, for example, if inflation rises sharply, but unemployment remains high? The Fed’s inability to anchor expectations would not only harm its credibility with investors, but would also make it much harder to fulfill its dual mandate of pursuing price stability and maximum employment.

Hostage to fortune These drawbacks apply to central banks’ forward guidance generally, and are leaving them hostage to fortune. The recent failure of the Bank of England’s guidance to move markets in the desired direction might mean that investors are more optimistic about the British economy. Or it might mean that central-bank guidance was ineffective, jeopardizing the BoE’s credibility. The European Central Bank faces similar risks.

For central banks, planning the exit from an accommodative policy stance is less important than exiting their current communication strategies. They should start withdrawing from their overly explicit policy commitments and attempts to micro-manage financial markets. Specifically, they should

stop giving forward guidance, including announcements about when they will begin to tighten monetary policy and by how much. They need to reintroduce true two-way risk, so that asset prices again reflect underlying fundamentals.

Rather than trying to nudge investors toward certain outcomes and explicit numerical targets, Ms Yellen and other central bankers need to communicate more clearly how they think about risks and opportunities in the economy and financial markets, and then let private investors decide the balance of risk and reward for themselves. This would help markets become more self-sufficient and resilient, thereby enhancing financial stability and providing support for economic recovery. ● Marcel Fratzscher, a former head of international policy analysis at the European Central Bank, is president of the German Institute for Economic Research (DIW Berlin) and professor of macroeconomics and finance at Humboldt University, Berlin.

Copyright: Project Syndicate, 2013.

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COVER STORY

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OCTOBER 14-20, 2013

Investment of the Year Awards nominees

Ambassadors for investment On October 23, WBJ will award three investments with the Investment of the Year Award at a gala event at the Amber Room restaurant in Warsaw. The event will mark the second time this newspaper has held the ceremony – but this year is different.

Instead of awarding a single investment, we will shine the spotlight on three: one from each of the small, mediumsized, and large investment categories.

The initiative is part of Warsaw Business Journal Group’s Investing in Poland project, which is threepronged: it comprises the awards gala, as well as the Investing in Poland publication – the fifth annual edition of which was launched earlier this year – and a business conference discussing issues and challenges surrounding investment in Poland.

Chambers of commerce active in Poland have nominated up to three investments, one per category, carried out by companies from their countries. To qualify for consideration, a nominated investment project must have been completed between

Small Investment category

September 2012 and August 2013. Investments in the “Small Investment” category must not have created more than 10 jobs, those in the “Medium-Sized Investment” category must have created between 11-99 workplaces, while investments in the “Large Investment” category must have created more than 100 jobs.

Below, we present a snapshot of all of the nominated investments – all of which deserve praise for their innovativeness and local impact.

Only one company per category can win, though, and the winners will be announced at the gala on October 23. ●

Coyote Polska Innovative road information service Coyote System has introduced a geolocation solution which provides real-time traffic updates to drivers and warns them about incoming dangers, traffic jams and even locations of active speed cameras. Coyote is investing in job creation, from IT specialists and engineers to marketing specialists. Its products are used by 2.3 million drivers in eight countries.

Jobs directly created by the investment: 10 Amount directly invested: €1 million

COURTESY OF COYOTE POLSKA

Warsaw Business Journal presents its shortlist for its Investment of the Year Awards

Innovative factors: creating a new category in the field of information systems for drivers

DB Schenker Rail Polska Freight railway operator DB Schenker Rail is the first in Poland to bring state-of-the-art Siemens Vectron electric locomotives into its fleet. The investment makes it the only rail operator in Poland to have such modern, ecofriendly machines, which the producer describes as “30 years more technologically advanced” than competitors’ products. They are also safer and more efficient, which should give Schenker a better position in the market.

Jobs directly created by the investment: 1-10 Amount directly invested: €50 million

COURTESY OF DB SCHENKER RAIL POLSKA

High-tech locomotives

Innovative factors: Ecological investment, technological improvement

SENER

WBJ

Which three companies will receive statuettes for investment of the year?

Spain’s SENER wants to capitalize on Poland’s new membership in the European Space Agency with the opening of an aerospace unit in its Warsaw office. Highly skilled Polish engineers are benefiting from technology transfer from the Spanish parent company’s more than 40 years of experience. Local, highly skilled engineers are working on a number of projects connected with mechanical and actuation systems, navigation and space system engineering and optical systems sectors.

Its team is already running three mechanical systems and navigation projects which are to be used in future space missions. By investing €500,000 so far in Poland, and hiring up to

COURTESY OF SENER

Warsaw Aerospace unit

25 employees eventually, the company, by 2017, plans to become a sustainable, highly innovative space company which would compete in the European market.

Jobs directly created by the investment: Currently 5, targeted 25 Amount directly invested: €500,000 so far Innovative factors: Cutting edge technologies in mechanics, optics and navigation

COVER STORY

OCTOBER 14-20, 2013

Medium-Sized Investment category

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Large Investment category Po∏aniec power plant modernization

entire servicing process. For business customers it created an innovative pick-up point in the office park on ul. Post´pu in Warsaw for servicing cars, as well as an airport service.

Jobs directly created by the investment: 31 Amount directly invested: z∏.7.1 million Innovative factors: The largest and most modern Skoda Dealership in Poland

COURTESY OF GHELAMCO POLAND

Certificate for a delivered office building.

Jobs directly created by the investment: 23 Amount directly invested: WND Innovative factors: Sustainability, efficiency, comfort for users, technology

COURTESY OF VEOLIA US¸UGI DLA ÂRODOWISKA

Innovative waste-management plant

for refuse-derived fuel, and a composting plant. The project was realized in accordance with the policy of Veolia, which develops environmental technologies in line with its philosophy of turning waste into a resource.

Jobs directly created by the investment: 15 Amount directly invested: z∏.28 million Innovative factors: The best available technologies in waste management

Chinese IT and telecommunications giant Huawei works for 45 of the 50 biggest telecommunication operators in the world.

Since 2008, Poland has been the company’s headquarters for CEE and Nordic countries.

In addition to that, the company has chosen Poland to become the operational center for Eastern and Northern Europe. The company currently employs 500 people in the country and works with every major telecommunication provider, offering solutions and products

COURTESY OF HUAWEI POLAND

CEE Operational Center

Veolia Us∏ugi dla Ârodowiska

With the new amendment to the law on municipal waste going into force on January 1, 2012, Veolia was one of the companies that quickly adapted to the new regulations. After investing in its Jaroszów facility, it now receives and manages waste from the Lower Silesia voivodship. The investments included: a sorting plant for municipal waste and waste collected separately with a production line

Amount directly invested: €250 million Innovative factors: Scale, lowered environmental footprint, low ATEX risk

Huawei Poland

Ghelamco Poland T-Mobile Office Park One of developer Ghelamco Poland’s most recent projects, the T-Mobile Office Park in Warsaw, is also one of its greenest schemes to date.

It aims to have the minimum effect on the local community and the environment.

The project was developed according to the values of sustainable building, being both eco-efficient and providing the greatest comfort for users and the highest technical standards. Its quality was confirmed when the development became the first in Poland to receive the BREEAM Excellent

The modernization of GDF Suez’s power plant in Po∏aniec created work for 700 people in its construction and renovation phase and an additional 100 jobs at the facility after the modernization was completed. The plant, which is the world’s largest power unit entirely fueled by biomass, has also become one of Poland’s largest renewable-energy producers.

The biomass-powered bloc has a capacity of 205 MW and can power up to 600,000 households.

The modernization has lowered the plant’s environmental footprint, reducing CO2 emissions by 1.2 million metric tons a year. It has also increased Poland’s share of energy produced by renewable sources, which also helps the country achieve its environmental policy objectives to reduce carbon emissions.

Jobs directly created by the investment: 100

COURTESY OF GDF SUEZ ENERGIA POLSKA

GDF SUEZ Energia Polska

High-tech car showroom

COURTESY OF BOHEMIA MOTORS

Bohemia Motors

Bohemia Motors is the first Skoda dealership in Europe to meet all the latest requirements and innovative standards of Skoda Auto Europe. It uses all the latest technological solutions in its showroom, including allowing customers configure their cars with the use of a smart phone or tablet computer. Its service centers also allow drivers monitor their cars during the

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such as smartphones and tablets.

Jobs directly created by the investment: 100 Amount directly invested: WND Innovative factors: Modern technologies, IT

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HR IN FOCUS

www.wbj.pl

OCTOBER 14-20, 2013

Interview

WBJ talks to two Hays executives: Alistair Cox, the company’s CEO, and Micha∏ M∏ynarczyk, managing director of Hays Poland, about the current conditions in the Polish labor market and how it is shaped by labor legislation and educational policies Beata Socha: The Hays Global Skills Index suggests that the labor market is showing significant improvement. Is the worst behind us?

Alistair Cox: Poland is one of the very few countries in Europe which never suffered any recession. I think that some of the inherent characteristics in Poland, such as skills, cost base, attractiveness as a destination for outsourcing has helped it weather the storm much better than most other economies.

It offers something unique at a time when companies want to tap into that uniqueness.

Despite a relatively low growth rate last year, this year the economic prognosis is much better, we can see increased levels of FDI coming to the country.

We see a host of different projects in different sectors, whether they be construction projects, infrastructure, energy or a continuation of the shared service center wave.

One of the consequences of the economy and labor market doing well is that you start to see wage pressure. You start to see that in sectors which are hot, whether it is SAP programming, development languages, etc. You start to see wage pressure of up to 10-15 percent.

So are Polish IT specialists still attractive on the global labor market?

Micha∏ M∏ynarczyk: In those niche areas the difference between Western Europe and Poland is not big really. If you are looking for an SAP developer it is sometimes better to get someone who is already working, for example, in France than hire someone with insufficient skills in Poland.

Today the wage pressure just reduces the margins of the companies. The offshoring trend to Poland is price-driven so far. You could argue that this increase in the prices of IT services will stop this offshoring trend.

Alistair Cox: The world suffers from a lack of engineers.

Whether they be energy and gas engineers, water engineers, civil construction engineers, these people are in great demand and there aren’t enough of them in the world.

Your report says that currently the long-term unemployment in Poland is at 3.4 percent. How does it compare with the rest of the world?

Long-term unemployment is individuals who haven’t had a job for over a year but want to find one. The score of 3.4 percent is quite low. And it is lower

that the long-term average used to be. It used to be at 6 to 7 percent. It’s a sign that people who are laid off can find a new job relatively quickly.

How would you characterize Polish labor law compared to other countries’ legislation?

Micha∏ M∏ynarczyk: The Polish government made a decision eight years ago to allow for freelance work and now statistically the share of selfemployed people in Poland in the entire labor force is higher than anywhere else in Europe.

Very often they work in the same way as they would on a standard employment contract. It was a really strong message to the market that we support flexible work and the trend will continue and there is a big battle that has been going on about it for years. But it’s inevitable, the whole market is going this way.

We still think in the oldfashioned way that a resume should be a list of employers, a list of jobs. Meanwhile these days a resume is becoming just a list of projects. People don’t even mention the company.

It’s a conscious choice. In fact people who do flexible work receive a higher hourly rate compared to those on permanent contracts as a compensation for the flexibility. So they earn more.

Alistair Cox: Some countries mitigate against temporary work contracts. But this is a valuable and valid part of the workforce to allow companies to tap into skills when they

need them but then be able to let them go when they don’t – be it after some projects finish or depending on the economic boom and bust. Those more flexible workforces tend to be the most efficient ones where the talent finds the job and the jobs find the talent.

One thing the UK did well during the crisis was a dialogue between the employers and the workforce: Will you take a wage freeze? Will you work four days a week? Will you take half days? Will you take a month off unpaid and then come back to work?

Did people agree to this?

Alistair Cox: In previous recessions there was a huge standoff between employers and employees and a natural reaction was mass redundancies and people going on the dole. But this time around it was different. Probably 500,000 people in the UK kept their job because of that flexible attitude they both adopted.

Those who say it’s against the rights of the employees don’t realize that the choice is simple: Are you flexible or do you run the risk of being laid off?

Often temporary work is portrayed as second-class work, a lower quality job, because someone cannot secure a permanent job. We think it is just the opposite.

And actually you have thousands of people who want that flexibility. They want to build their career around a series of

COURTESY OF HAYS

Promoting flexibility

Alistair Cox interesting projects. They want to be able to move in and out of the labor force according to their needs.

The evidence does suggest that the markets that are more successful in creating the match between their people and their industries are those that promote that flexibility.

A study conducted a few months ago showed that the z∏.1.2-billion government program to fund courses of study expected to be in demand, such as chemistry or environmental protection, turned out to be a complete fiasco. These groups of graduates now have the highest unemployment levels. Yet, your research suggests Poland’s educational system is efficient. How can that be?

Micha∏ M∏ynarczyk: There’s more and more cooperation between universities and employers these days. Right now almost every single university has a body delegated to

speak to employers. The employers often set up specific courses and in many universities you need an internship to graduate.

Also there are a decreasing number of students, which forces universities to compete.

How do you compete on this market? You just make sure that your graduates have it easier to find a job. That’s how you compete with other schools.

Alistair Cox: Those markets that have a better match between talent and opportunity are those that have really looked harder at what it is that the universities are doing, linking up with business so that there is a common understanding and adapting their educational systems. If we need more of these and less of those, we will create new courses, and we’ll link with industry and we will motivate the youngsters to go down that route because that’s where the careers are. ●

Labor market

Poland good at matching talent with opportunity Despite high wage pressure in highskilled industries, Poland’s labor market remains balanced thanks to good educational standards Poland ranked third out of the 30 countries examined by global recruiter Hays as one of the countries with the lowest level of talent mismatch.

It received a score of 3.3 on a scale of 0 to 10.0, with 0 indicating that employers have very little problem finding the skills they need and 10.0 meaning the level of longterm unemployment remains high despite a large number of vacancies. The only two countries which scored better in matching talents with jobs were the Czech Republic (0.7) and Belgium (2.2).

Poland’s overall score in the Hays Global Skills Index was 5.2, the same as last year, which indicates that Poland has an efficient and balanced labor market.

High salaries in IT Out of all the factors examined, wage pressure in highskill industries created the highest upward pressure on the overall index. A score of 7.3 in the high-tech sector, where 5.0 is the equilibrium point, means that wages in those industries increased much faster than in other sectors.

“IT specialists and engineers are in the highest demand in Poland, therefore their salary level exceeds those of other professions,” said Micha∏ M∏ynarczyk, managing director at Hays Poland.

On the other hand, the country’s effective and high-

quality education system produces a large number of wellqualified graduates, making it easier for employers to find the people they need.

The country also had a relatively low long-term unemployment rate of 3.4 percent, which is lower than that of Portugal (8.7 percent), Ireland (8 percent), Italy (6.3 percent) and Hungary (5.4 percent), but still significantly higher than in Austria (1.3 percent), Russia (1.8 percent) and the Czech Republic (3 percent).

The world China saw an improved score from last year’s 5.5 and recorded a score of 5.0 in 2013, which points to an almost perfect balance in the Asian country’s labor market. Austria with 5.1 and Poland, the UK and France (5.2 each) also have reasonably balanced skilledlabor markets.

Italy remained the country with the lowest score of 3.6, which points to significant skills shortages in the labor market, but still closer to equilibrium than it was last year with a score of 3.3. Businesses in the Czech Republic (a score of 4.4) may also

encounter difficulties in filling top positions.

Japan on the other hand had the highest score (6.6), which compared to last year’s result of 5.3 points to a deteriorating situation on the labor market with a growing mismatch between the skills

available and the skills needed. The United States had the second-highest score at 6.4, the same as in 2012, indicative of significant difficulties skilled workers continue to experience in finding employment.

Beata Socha

The Hays Global Skills Index The Index ranges between 0 and 10.0, with 5.0 corresponding to a balanced picture for the labor market. A score close to 0 indicates that companies are facing some skills shortage, which may result in adverse consequences such as wage inflation, whereas a score close to 10 is characteristic for labor markets where there are many skilled workers who cannot find suitable jobs, which leads to high unemployment levels in the skilled workforce.

The indicator measures seven key factors shaping the skilled labor market in developed economies. It measures “education flexibility,” meaning the ability of the country’s education system to meet the labor needs of the

industries. It also assesses “labor market participation,” corresponding to how many working-age people are in the labor pool, and “labor market flexibility,” which assesses the legislation and the constrains it puts on the market. Another factor examined is “talent mismatch,” which portrays the discrepancy between the available skill pool and what businesses need. There are also three wagepressure factors included in the index: “overall wage pressure” which shows if wages keep up with inflation or diverge from it, “wage pressure in high-skilled industries,” such as IT or R&D, as well as “wage pressure in highskill occupations.” ●

Investors at Expo Real 2013 were optimistic about the future of CEE markets

Warsaw ranked 14 in the world in cross-border investment, fueled mainly by office market growth 16

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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

Galeria Pomorska financing Resolution Real Estate Fund III, managed by Resolution Property, signed an agreement with Pbb Deutsche Pfandbriefbank, which will provide a loan worth €55.8 million for the expansion of the Galeria Pomorska shopping mall in Gdaƒsk.

The funds have been earmarked for construction as well as for refinancing Galeria Pomorska’s existing debt.

Carrefour opens 15 new stores Supermarket network Carrefour opened 15 new stores in Poland in September. The new units will operate under the Carrefour Express and Globi brands. The new stores were launched in Warsaw, Kraków and in a number of small towns such as Sobolew and Stromiec, Carrefour said.

The company now has over 380 Carrefour Express and Globi branded stores across Poland. ●

In this issue Galeria Kazimierz sold . . . . . . . . .15 LC Corp’s new Office scheme . .15 Expo Real report . . . . . . . . . . . . . .16 Aquasfera residential project . .17 Phase 2 of A4 BP launched . . . .17 Warsaw in world investment ranking . . . . . . . . . . .18

Galeria Kazimierz sold for €180 million

The transaction will bring the developer net proceeds of €50 million

monopoly watchdog. It also requires consent from the bank financing the purchase and is expected to be completed in early 2014.

Galeria Kazimierz has a GLA of 38,205 sqm and houses 130 tenants, including Cinema City, Alma, EMPIK and Reserved. It was built by GTC in 2005. It is the thirdlargest shopping mall in the southern city of Kraków, behind Bonarka City Center (270 stores on 91,000 sqm of GLA, opened in 2009), and Galeria Krakowska (also 270 stores, 60,000 sqm, delivered in 2006). The city is also expecting another major retail scheme soon, Galeria Bronowice, with 160 stores and 60,000 sqm of GLA, set to be delivered in November 2013.

Warsaw-based developer GTC was established in 1994.

It is active in almost all CEE markets, including Hungary, Czech Republic, Romania, Bulgaria, Russia and Ukraine.

Real estate developer Globe Trade Centre (GTC) has agreed to sell its 50 percent stake in the Galeria Kazimierz shopping mall in Kraków to Nellia, a unit of the Invesco Group.

Another 50 percent stake will be sold by GTC’s business partner Avestus. The full value of the deal was €180 million. GTC will net some €50 million on the transaction, the company said.

“The decision to dispose of Galeria Kazimierz is in line with our policy to refresh the company’s portfolio by selling regional maturing assets and replacing them with new developments that offer attractive returns,” GTC chief executive Alain Ickovics said in a statement.

The deal is subject to approval from Poland’s anti-

COURTESY OF GTC

Polonia Property I, a real estate investment fund managed by Peakside Capital, sold its Diamond Business Park (DBP) warehouse complex in ¸ódê. Neither the name of the buyer nor the value of deal were revealed. The complex consists of three buildings with a total GLA of 60,800 sqm.

Retail

The 38,000-sqm mall is the third-largest retail scheme in Kraków It develops and manages retail, office and residential investments.

Avestus is a private Euro-

pean real estate investment manager with offices in Warsaw, Prague and Dublin. The company invests in the com-

mercial, retail and hospitality segments.

Kamila Wajszczuk, Beata Socha

Office

LC Corp launches its first investment in Katowice The new complex is yet another office scheme currently in the pipeline in the capital of Silesia Developer LC Corp is launching its first office project in Katowice. The 27,000 sqm scheme, which will be constructed on Al. Roêdzieƒskiego in the center of Katowice, will feature two eightstorey office buildings connected by a smaller retail and services unit with shops and cafes.

The scheme will also have a parking lot with 250 spaces.

The cost of constructing each of the buildings is estimated at €59 million.

The first structure is scheduled to be completed in the fourth quarter of 2014. It is set

ice is not the only business space currently under construction in the southern city.

A few kilometers away, Skanska is developing the first of four buildings of its Silesia Business Park. Skanska’s development is set to deliver a total of 46,000 sqm of GLA to the market. On top of that, Echo Investment is also launching another development in Katowice, the second stage of its A4 complex, already pre-leased to IBM (see story, p. 16).

COURTESY OF LC CORP

DBP ¸ódê sold

OCTOBER 14-20, 2013, LI 18/40

The new office development will deliver 27,000 sqm of GLA to deliver 12,710 sqm of office and 1,030 sqm of retail space, together with an underground parking area.

The general contractor of the first phase of the scheme is

listed construction firm Budimex. The buildings were designed by architects from the Kury∏owicz & Associates studio.

The new scheme in Katow-

Vacant space LC Corp may not be so lucky securing tenants for the new scheme, though. It has had considerable difficulties in leasing out its flagship investment, the Sky Tower mixed-use complex, located

in the southwestern city of Wroc∏aw.

The developer has recently announced it is implementing a new commercialization strategy meant bring down the vacancy rate in Sky Tower. The scheme, offering 22,000 sqm of office and 24,000 sqm of retail space, was delivered in 2012. Currently 23 percent of the retail space and 28 percent of the office space remain vacant.

The company said that the weak take-up was the product of the difficult market for commercial real estate last year. With the new strategy, the company wants to bring down the vacancy in both the retail and in the office portions of the scheme to around 5 percent.

Beata Socha

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

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www.wbj.pl

LOKALE IMMOBILIA – REAL ESTATE

OCTOBER 14-20, 2013

Expo Real

Investors and developers at Expo Real 2013 were optimistic about the outlook for the market, particularly in Central Europe The 16th annual Expo Real fair was proof that after years of stifled growth and tentative investment decisions, optimism has returned to the property market. The strong Central European markets prompted a positive mood and remained in the spotlight throughout the three-day event.

“There was a positive atmosphere at Expo Real 2013 – we are on the brink of a turning point. The mood is continuing to improve and we are seeing an increased willingness to do business right across the board,” said JanWillem Bastijn, head of EMEA Capital Markets at Cushman & Wakefield.

As many as 36,000 people from 65 countries visited the fair in Munich on October 7-9.

Apart from Germany, the top 10 countries in terms of representation at Expo Real were the UK, the Netherlands, Austria, Switzerland, France, Russia, Poland, the Czech Republic, the US and Luxembourg.

Factory revamp awarded

City offers With officials from over 20 cities and six of Poland’s voivodships, the country was by no means underrepresented. Cities offered investors both land and developed real estate.

The north-central city of Bydgoszcz has a very comprehensive strategy aimed at attracting investors, including not only tax incentives, road infrastructure and utilities for the land on sale, but also by creating enclaves, such as the Bydgoszcz Technology Park, which provide highly skilled labor.

“Today you can’t simply offer land for investment, you have to offer a package: together with the human resources and leisure activities,” said Edyta Wiwatowska, manager at Bydgoszcz City Hall.

The southern city of Wroc∏aw, in the Lower Silesia voivodship, showcased several pieces of land for sale,

some of which contain 19thcentury buildings that once housed hospitals. Officials are counting on foreign investors to purchase these properties and refurbish them for commercial, office, services or residential use.

The buildings are considered monuments and have to be redeveloped according to the requirements of the curator of historic buildings, which for some investors is a significant deterrent.

Added value However, Iwona Dyszkiewicz, director of the Marshall’s Office of Lower Silesia said, “A monument is an added value, and should not be perceived as a nuisance.” One of the major benefits is that the state will reimburse 50 percent of all investment outlays incurred to refurbish buildings which are entered in the register of monuments. Moreover, the bulk of these properties are located in the very heart of the city.

Almost all representatives agreed that investors are most interested in plots of land situated in city centers, making them an ideal location for retail or office projects.

“Downtown properties are selling like hot cakes. Some two years ago we had a tender, where a Warsaw-based company raised the offer price from z∏.1.6 million to z∏.2.5 million for a tiny plot earmarked for office development,” Adam Zakrzewski, director of Toruƒ’s investor assistance office.

The city of ¸ódê was awarded at Expo Real for the Ludwik Grohman factory revamp project Big deals One of the conferences held at the fair was devoted specifically to Poland’s real estate market. The panelists were international investors active in the Polish market, such as Franz Jurkowitsch, CEO of Warimpex, Martin Sabelko, managing director CEE at CBRE Global Investors and Daniel Harris, managing director at Tristan Capital Partners, as well as Polandbased investors: Marcin Juszczyk, member of the board at Capital Park and Waldemar Olbryk, managing director at Skanska.

Mr Harris pointed out that though the number of deals made in 2013 has decreased, their sizes are getting bigger.

He also added that if we take out Russia, “the majority [of all the money invested in CEE] is going to Poland,

because that’s where the growth is coming from.”

Mr Olbryk from Skanska did say that there is worry about the continuity of office demand in the the BPO/SSC market which is driving growth in Poland’s office sector, but added that the studies his company carried out suggest that a lot of business in the sector is in fact still growing, with companies shifting from the Far East to Poland.

Investing trends The panelists agreed that while office developers look almost exclusively to big cities and their centers, retail projects are beginning to mushroom in smaller cities, even medium-sized towns like Bielsko-Bia∏a or Stalowa Wola, which has a population of 65,000. According to Marin Sabelko from CBRE,

the key to a successful retail investment in smaller cities is to have the dominant project.

“As long as you are dominant, you win, but if you are second in line, you lose already,” Mr Sabelko said.

As to the source of the investments, Mr Sabelko said that even though Poland is mainly attracting funds from US and German investors, many Asian funds have also become interested in it.

Poland is the top destination for Asian investors in the CEE region due to its size and stability.

“Chinese and other investors are looking for a record, the number of deals, the size of international investors’ [involvement]. They look at how Poland is seen by international investors,” Mr Sabelko explained.

BEATA SOCHA/WARSAW BUSINESS JOURNAL COURTESY OF THE CITY HALL OF BYDGOSZCZ

The city of ¸ódê was awarded the John Jacob Astor Award for the redevelopment of the 19th-century Ludwik Grohman factory. The prize included a 20-sqm exhibition area at

Expo Real 2014 worth €10,000. The award was accepted by the city’s mayor Hanna Zdanowska.

The revitalization project was launched in 2011 and took two years to complete. It entailed the renovation and extension of the former industrial buildings while preserving their historical character, creating a modern office building for the headquarters of the Lodz Special Economic Zone, the project’s investor, as well as a culture and conference center for more than 250 people.

COURTESY OF LODZ SEZ

Real estate market turns the page

The Polish real estate market was the subject of one of the fair’s panels

Bydgoszcz has prepared a comprehensive strategy to attract investors

Beata Socha

LOKALE IMMOBILIA – REAL ESTATE

OCTOBER 14-20, 2013

Residential

Polnord and Semeko to build Aquasfera

Echo Investment launches phase two of A4 Business Park WSE-listed developer Echo Investment has started construction on the second stage of its A4 Business Park office complex on ul. Francuska in Katowice, Silesia. The 10storey office scheme will deliver 9,000 sqm together with 560 spaces in a multi-storey parking lot. Remax Construct has been chosen as the contractor for the building’s shell.

The BREEAM-certified A4 Business Park complex, whose name comes from the A4 highway located nearby, is

being delivered in three phases. The first one, scheduled to be completed in Q1 2014, offers 9,000 sqm on seven floors and has been pre-leased to IT concern IBM. Echo Investment is currently involved in a number of office projects both in Poland and in the greater CEE region, including the 55,000-sqm Q22 tower in Warsaw’s downtown, set to be delivered in Q1 2016, the 32,000-sqm Park Rozwoju office complex in Warsaw’s Mokotów district, as well as

the West Gate office scheme in Wroc∏aw, which comprises 16,000 sqm of GLA. The developer is also active in the retail and residential segments. Its residential projects currently under construction include Nowy Mokotów, also located on ul. Konstruktorska, set to deliver 700 apartments, and Osiedle JaÊminowe in Poznaƒ, consisting of 14 five-storey multifamily buildings together offering 375 units.

Beata Socha

The Aquasfera complex will consist of three buildings with a total area of 27,500 sqm The first stage of the development, with 93 apartments, will be completed by the end of 2013. So far 64 units have been sold.

The second stage, with 120 apartments, is scheduled to be delivered in Q3 2015.

Polnord has sold 376 units throughout all of its residential projects so far this year, 130 in the third quarter alone. The group said it plans to commer-

cialize another 500-550 apartments this year. In 2012 it sold 939 units, 40 percent of which in the fourth quarter largely thanks to the government subsidy program “Family on its Own,” which came to an end at the end of 2012.

Semeko is a residential developer active mainly in the Tri-City area in Poland’s north.

Kamila Wajszczuk, Beata Socha

COURTESY OF ECHO INVESTMENT

Stock exchange-listed developer Polnord and its market peer Semeko have created a joint venture to carry out the Aquasfera project in Reda, near Gdynia. The newly created SPV, called Semeko Aquasfera, will build almost 30,000 sqm of residential and service space, the value of which is estimated at z∏.133 million. The deal was finalized on October 7.

Semeko transferred organized assets into the SPV, including a two-hectare plot of land and preliminary apartment sales agreements. Polnord bought a 50-percent stake in the newly formed company for z∏.10 million.

The Aquasfera complex will consist of three buildings with about 560 apartments total. The buildings together will have an area of 27,500 sqm. Area for commercial and service outlets will amount to some 2,000 sqm.

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COURTESY OF SEMEKO

The two developers formed a joint venture to develop a 560-unit residential estate near the Tri-City area

www.wbj.pl

The A4 Business Park complex is being delivered in three phases, the first one due to be completed in Q1 2014

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LOKALE IMMOBILIA – REAL ESTATE

www.wbj.pl

OCTOBER 14-20, 2013

Investment

Warsaw ranks high in cross-border investment The office market continues to be the country’s main source of growth, despite yields lower than in other CEE countries Warsaw ranked 14th in the world among cities with the highest cross-border real estate investment volumes between Q3 2012 and Q2 2013, according to a Cushman & Wakefield report. In the 12 months analyzed in the study, Warsaw attracted over $2.1 billion from foreign investment funds, surpassing

Moscow, with a little over $2 billion, as well as Munich, which drew a little under $2 billion.

“Among emerging markets, Asian cities offer a stronger blend of scale, growth and innovation than key hubs in Latin America or Eastern Europe but that may change as Latin America gets used to a higher global profile and as larger cities in emerging Europe – Moscow, Istanbul and Warsaw – develop as regional hubs,” the report reads.

Although the Polish capital didn’t make it into the top

50 cities in residential, industrial or retail investment volumes, it was placed 30th in the office sector ($1.805 billion), which in turn helped it secure the 47th position in total investment volume ($2.377 billion).

Top city target The study named Warsaw, alongside Amsterdam and Prague, as the top city targets for investment in 2014 in the core-plus office segment.

Currently there is over half a million sqm under construction in 41 new office schemes

in the Polish capital. This puts Warsaw among the top five European cities (behind Paris, London and Moscow) with the highest office development activity, according to a recent CBRE report. The largest schemes under construction include Warsaw Spire (100,000 sqm), Q22 (50,000 sqm) and Gdaƒski Business Centre (49,000 sqm).

“Increasing activity by office developers is strongly connected with strong demand from office tenants. ... In the first half of 2013 office take-up in Warsaw was 334,000 sqm, up 12 pecent in

comparison to the corresponding period last year,” Joanna Mroczek, CBRE expert said.

Yields in the middle Interestingly, in terms of yields, Poland is closer to Western European countries than markets further east. In the office investments segment, Poland offered a yield of 6.25 percent – exactly at the same level as in the Czech Republic and almost the same return investors see in the Netherlands (6.3 percent) or in Belgium (6.35 percent).

However, other Eastern economies, like Russia and

Romania, offer significantly higher yields, at 8.5 percent each.

In the retail segment Poland offers a very similar yield, at 6 percent, which is, again, significantly lower than in Eastern emerging economies like Romania with 8.5 percent or Ukraine with 16 percent. It is, however, more than a double what the UK market can offer in that segment (2.75 percent) and much more than Central European countries like Germany or Switzerland, which both offer a yield of 3.8 perBeata Socha cent.

Warsaw in global investment ranking Total investment volume Q3 2012 – Q2 2013 Rank

Office sector investment volume Q3 2012 – Q2 2013

Cross-border investment volume Q3 2012 – Q2 2013 city/metropolis

investment volume ($)

growth (compared with the previous 12 months)

1

London

22,409,206,269

5.6%

17.7%

2

Paris

6,982,111,604

-29.2%

13,383,455,234

1.5%

3

New York

6,242,567,788

-6.1%

Paris

11,235,446,263

-33.2%

4

Shanghai

3,886,841,965

27.6%

5

San Francisco

8,269,015,600

36.2%

5

Sydney

3,492,073,875

-2.3%

16

Moscow

3,692,716,248

5.0%

14

Warsaw

2,119,154,347

13.1%

20.5%

28

Hamburg

1,990,480,874

54.3%

15

Moscow

2,075,739,170

62.4%

20.8%

30

Warsaw

1,804,601,306

97.4%

16

Munich

1,999,767,688

city/metropolis

investment volume ($)

growth (compared with the previous 12 months)

1

New York

49,179,522,147

39.4%

2

London

32,274,829,182

6.1%

3

Los Angeles

30,757,876,871

77.3%

4

Tokyo

25,858,887,222

1.6%

5

San Francisco

21,749,045,653

37.9%

20

Moscow

7,132,864,084

47

Warsaw

2,376,765,902

Rank

city/metropolis

investment volume ($)

growth (compared with the previous 12 months)

1

London

23,546,672,088

31.0%

2

New York

20,340,082,488

3

Tokyo

4

Rank

5.6% Source: Cushman & Wakefield

THE LIST

OCTOBER 14-20, 2013

www.wbj.pl

19

Travel & Leisure

Travel Management Companies Ranked by number of tickets sold in 2012 A guide to Polish business and industry

www.bookoflists.pl

Przewodnik po polskim biznesie i gospodarce

Visa services / Conference organization / Training organization

Incentive trips / Additional insurance / IATA licensed ticketing agents

Online corporate reservation system / Global hotel reservation system / 24/7 emergency assistance

Number of agency-owned TMC offices in Poland / Total number of employees

Year IATA license obtained / Year founded in Poland

1

Carlson Wagonlit Polska Sp. z o.o. ul. Tamka 38, 00-355 Warsaw 22 556-2200/22 556-2299 cwt@carlsonwagonlit.pl www.carlsonwagonlit.pl

124,849 129,973 122,743 109,185

WND WND WND WND

WND WND WND WND

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Business travel management; expense analysis and optimization; negotiations with delivery companies; rail tickets in Poland and abroad; ferry tickets

Carlson Wagonlit Travel

6 124

1947 1919

Carlson Wagonlit Travel Compagne Internationale Wagonlit Travel

2

Weco Travel Sp. z o.o. ul. TaÊmowa 7, 02-677 Warsaw 22 520-2800/22 520-2886 info@weco.com.pl www.weco.pl

121,916 92,981 78,099 68,954

173.0 146.0 113.0 WND

227.0 195.0 152.0 WND

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Hotel reservations; train tickets; congresses; conferences; incentive trips (MICE); car rental; visas

Radius - The global travel management

4 80

1992 1992

None Weco-Travel CEE 80%; J.J. Singh - 20%

3

American Express Poland SA ul. Ch∏odna 51, 00-867 Warsaw 22 581-5100/22 654-7040 warsawbtc@aexp.com www.americanexpress.pl

81,524 89,750 86,324 66,743

142.1 153.9 WND WND

175.5 185.9 WND WND

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Optimization of business travel management

American Express Travel

1 73

1992 1992

WND

4

Fly Away Travel Sp. z o.o. ul. Po∏czyƒska 31A, 01-377 Warsaw 22 478-6333/22 478-6399 flycenter@flyaway.pl www.flyaway.pl

74,466 67,063 59,287 55,314

WND WND WND WND

WND WND WND WND

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Comprehensive corporate travel management; the lowest ticket price control; 24/7 helpdesk; train-ticket reservation system in all branches; Rail Europe

NA

6 68

1990 1990

WND None

Bart∏omiej Budzyƒski

5

Netmedia Business Travel Sp. z o.o. ul. D∏uga 44/50, 00-241 Warsaw 22 314-7249/22 314-7205 handlowy@nbt.pl www.nbt.pl

61,761 52,396 48,233 46,000

75.0 71.5 70.7 63.0

112.0 111.5 113.0 115.0

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Business travel management

Lufthansa City Center; EGENCIA

4 75

1990 1985

eTravel (Netmedia) 100% None

Marian Szypu∏a

6

Centrum Podró˝y Air Club Stanis∏aw Modliƒski ul. Senatorska 28, 00-095 Warsaw 22 829-9500/22 829-9550 info@airclub.pl www.airclub.pl

48,257 49,255 48,205 42,191

WND WND WND WND

WND WND WND WND

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Individual tourism; Club Med trips; incentive events; congresses; train tickets; buses; ferries; cruises

BCD Travel

1 99

1990 1990

Stanis∏aw Modliƒski 100% None

Stanis∏aw Modliƒski

7

Blue Sky Travel Sp. z o.o. ul. Roosevelta 2, 60-829 Poznaƒ 61 841-0900/61 842-0343 office@bluesky.pl www.bluesky.pl

47,535 44,539 35,209 29,848

7.9 6.9 6.3 2.3

17.3 13.4 13.4 12.4

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Comprehensive corporate travel organization and management; incentive trips; activities for individual tourism; ferry; coach; rail ticket sales

Lufthansa City Center

3 64

1992 1990

Jerzy Ruszkowski 60.1%; Jerzy and Ewa Ruszkowscy - 39.9% None

8

FCm Travel Express Al. Jana Paw∏a II 19, 00-854 Warsaw 22 453-5353/22 453-5301 travel@pl.fcm.travel www.fcmtravel.pl

33,000 31,000 27,000 21,000

WND WND WND WND

69.0 67.0 63.0 52.0

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

VIP service; customized travel management reporting and analysis; cost-saving initiatives

FCm Travel Solutions

3 40

1995 1994

WND

9

Supertour Lufthansa City Center ul. Niemcewicza 26, 02-306 Warsaw 22 556-6300/22 556-6310 super@supertour.pl www.supertour.pl

28,000 27,500 23,000 22,000

50.0 46.0 35.0 36.0

70.0 65.0 56.0 50.0

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Business travel management; cost optimization based on Business Plus Luthansa City Center, reports and analyses; Luthansa City Center internal training sessions; external training; seminars; Account Manager service

4 43

1993 1990

Bogdan Wieczorek; Wojciech Wojdat WND

Biuro Podró˝ników Flugo Sp. z o.o. ul. Marii Sk∏odowskiej-Curie 10, 85-094 Bydgoszcz 10 52 340-0416/52 341-7505 andreo@flugo.com.pl www.flugo.com.pl

5,483 4,635 3,763 3,996

9.0 7.4 5.0 5.1

20.1 16.6 13.5 9.2

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

Ski conferences; new product-launch trips; reference visit; organizing events; touroperator service; ferries; cruises

Alians Polska Sieç Biur Podró˝y

1 13

1998 1998

Andreo Grz´bowski 60%; Micha∏ Brzozowski - 40% None

Mazurkas Travel Biuro Podró˝y Sp. z o.o. ul. Wojska Polskiego 27, 01-515 Warsaw 11 22 536-4600/22 839-2090 mazurkas@mazurkas.com.pl www.mazurkas.com.pl

4,500 WND 4,300 WND

3.5 WND 3.0 WND

WND WND WND WND

✓ ✓

✓ ✓

✓ ✓ -

✓

WND

NA

WND WND

1993 1990

Andrzej Bartkowski 50%; Andrzej Hulewicz - 50% None

Generavia Sp. z o.o. ul. Wàwozowa 11/12A, 02-796 Warsaw NR 22 213-1903/22 250-1303 office@generavia.pl www.generavia.pl

WND NA NA NA

WND NA NA NA

WND NA NA NA

✓ ✓

✓ ✓ -

✓ -

✓

Helicopter, airplane and baloon rental

NA

1 2

NA 2012

Ewa Litmanowicz 0.5%; Professional Services Fundacja Towarzystwo - 50.5% None

Olimp Air Biuro Podró˝y Sp. z o.o. ul. ¸owicka 23, 02-502 Warsaw NR 22 549-6950/22 549-6956 olimpair@olimpair.com.pl www.olimpair.com.pl

WND WND WND WND

WND WND WND WND

WND WND WND WND

✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓

VIP service; individual luxury trips; product launches; cruises; private and family events

WND

1 WND

1995 1990

WND

Andrzej Górski

Warsaw Concierge Group ul. Wilcza 22/8, 00-544 Warsaw NR 22 378-1655 office@warsawcg.com www.warsaw-concierge.com

WND WND WND WND

WND WND WND WND

WND WND WND WND

✓ ✓

✓ ✓ ✓

✓ ✓ -

✓ ✓

Concierge services

NA

1 10

NA 2011

WND

Monika Józefowicz

Rank

Hotel reservations / Car rental brokerage

Services offered for companies

Company name Address Tel./Fax E-mail Web page

Number of tickets sold

Turnover from tickets sales (z∏. mln)

Total revenue (z∏. mln)

2012 / 2011 / 2010 / 2009

Notes: NA = Not Applicable, NR = Not Ranked, WND = Would Not Disclose. Research for The List was conducted in April 2013. Number of employees and ownership structure are as of April 2013. All information pertains to the companies’ activities in Poland. Companies not responding to our survey are not listed.

Other

Global travel management network

Ownership: Polish / Foreign

Top local executive / Title

Westyna Kulczycka General Director

J.J. Singh President

Pawe∏ Orlik General Director

Director; Board Member

President

President

Jerzy Ruszkowski President

Tim Hyland President

Bogdan Wieczorek President

Andreo Grz´bowski President

Andrzej Hulewicz Vice President

Jacek Galinowski CEO

President

Managing Director

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 online@bookoflists.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

OCTOBER 14-20, 2013

Stocks report

world stock indices DJIA

NASDAQ

S&P500

FTSE100

DAX

NIKKEI

15,126.07 (Oct 10 close)

3,760.75 (Oct 10 close)

1,692.56 (Oct 10 close)

6,487.19 (Oct 11 close)

8,724.83 (Oct 11 close)

14,404.74 (Oct 11 close)

0.86% (for the week)

-0.36% (for the week)

0.83% (for the week)

0.52% (for the week)

1.18% (for the week)

2.71% (for the week)

CHANGE: 12.78% (year to Oct 10)

CHANGE: 20.84% (year to Oct 10)

CHANGE: 15.74% (year to Oct 10)

CHANGE: 7.63% (year to Oct 11)

CHANGE: 12.16% (year to Oct 11)

CHANGE: 34.77% (year to Oct 11)

52-week high: 15,709.58

52-week high: 3,819.28

52-week high: 1,729.86

52-week high: 6,875.60

52-week high: 8,767.97

52-week high: 15,942.60

52-week low: 12,471.49

52-week low: 2,810.80

52-week low: 1,343.35

52-week low: 5,605.60

52-week low: 6,950.53

52-week low: 8,488.14

Eyes on the US Omar Arnaout Noble Securities SA

Major indices WIG

52,230.47 (October 11 close)

WIG30

2,651.95 (October 11 close)

11.10

10.10

09.10

08.10

07.10

04.10

03.10

02.10

01.10

30.09

27.09

26.09

25.09

11.10

10.10

09.10

08.10

07.10

04.10

03.10

02.10

01.10

30.09

2,400

27.09

48,000

26.09

2,460

25.09

49,000

24.09

2,520

23.09

50,000

20.09

2,580

19.09

51,000

18.09

2,640

17.09

52,000

16.09

2,700

24.09

52-week low: 2,286.99

23.09

Change year to October 11: 1.05%

20.09

52-week low: 43,145.55

19.09

52-week high: 2,651.95

Change year to October 11: 8.57%

18.09

Change for the week: 3.62%

17.09

52-week high: 52,230.47

16.09

Change for the week: 3.22%

53,000

Top 5 MEWA ATENDE REINHOLD COGNOR PPG

Closing 0.23 2.39 0.96 1.58 0.27

% change (week) 52-week high 53.33 0.42 36.57 2.50 35.21 1.19 30.58 2.74 28.57 0.53

52-week low 0.13 0.98 0.22 0.57 0.17

Top 5 BRE HANDLOWY CCC EUROCASH GTC

Closing 514.00 118.00 126.40 48.00 7.91

% change (week) 9.36 7.71 7.39 6.90 6.46

52-week high 517.00 123.60 127.95 66.56 10.25

52-week low 282.79 80.70 56.14 37.48 6.58

Bottom 5 GANT CIGAMES ALTERCO NOKAUT POLIMEXMS

Closing 0.60 11.00 0.83 2.40 0.16

% change (week) -46.90 -31.46 -17.00 -16.67 -15.79

52-week low 0.59 11.00 0.61 2.30 0.09

Bottom 5 LPP INGBSK BOGDANKA PGNIG KGHM

Closing 9,100.00 110.00 112.10 5.98 123.00

% change (week) -3.98 -1.08 1.08 1.36 1.82

52-week high 9,600.00 116.90 136.74 6.76 179.15

52-week low 3,721.49 82.30 92.95 3.78 106.90

52-week high 4.83 28.90 4.38 7.99 0.68

Last week started rather calmly on global stock markets and the Warsaw Stock Exchange was no different.

Investors were simply awaiting Wednesday’s release of the minutes of the September US Federal Open Market Committee meeting, as well as further developments on the US government shutdown.

Investors also learned that the new head of the US Federal Reserve will be Janet Yellen, but that information did not cause any major movements.

Markets did however respond with strong optimism to Thursday’s news from Washington. US President Barrack Obama and congressional leaders held negotia-

Currency report

Low volatility on the z∏oty market

Other indices WIG20

2,489.64 (October 11 close)

mWIG40

3,402.39 (October 11 close)

Change for the week: 3.97%

52-week high: 2,628.36

Change for the week: 2.39%

52-week high: 3,402.39

Change year to October 11: -5.20%

52-week low: 2,177.02

Change year to October 11: 32.46%

52-week low: 2,383.61

Adam Narczewski X-Trade Brokers DM SA

3,500

2,500

3,420

2,450

3,340 2,400 3,260 2,350

11.10

10.10

09.10

08.10

07.10

04.10

03.10

02.10

01.10

30.09

27.09

26.09

25.09

24.09

23.09

20.09

SOURCE: WSE

11.10

10.10

09.10

08.10

07.10

04.10

03.10

02.10

01.10

30.09

27.09

26.09

25.09

24.09

23.09

20.09

11.10

10.10

09.10

08.10

07.10

04.10

03.10

02.10

310

01.10

13,000

30.09

314

27.09

13,200

26.09

318

25.09

13,400

24.09

322

23.09

13,600

20.09

326

19.09

13,800

18.09

19.09

52-week low: 296.29

330

17.09

18.09

52-week high: 353.00

Change year to October 11: -2.36%

14,000

16.09

324.37 (October 11 close)

19.09

52-week low: 9,660.90

18.09

Change year to October 11: 29.51%

NewConnect Change for the week: 0.70%

17.09

52-week high: 13,638.56

17.09

11.10

10.10

09.10

08.10

07.10

04.10

03.10

02.10

13,638.56 (October 11 close)

Change for the week: 0.92%

16.09

sWIG80

01.10

30.09

27.09

26.09

25.09

24.09

23.09

20.09

19.09

18.09

17.09

3,100

16.09

3,180

16.09

2,300

tions to extend the borrowing limit, at least temporarily.

The above-mentioned optimism could be seen on the Warsaw Stock Exchange, too. The WIG20 Futures rallied from the level of 2,389 to as high as 2,472 last Thursday. What also has to be mentioned is that this was a very good week for the banking sector, with Citi Handlowy, Pekao and BRE all noting significant increases.

On the other hand, investors couldn’t have been satisfied with the performance of KGHM, which despite gains like other major stocks, noted a relatively small increase, with the market still signaling uncertainty from the technical point of view. ●

It seems that the financial world has already gotten used to what is going on in the US in terms of the country’s budget (or lack thereof) and the extension of the debt limit.

This past week everybody focused on the nomination of Janet Yellen as the next head of the US Federal Reserve.

She will probably be the one who will start increasing interest rates in the US (in the next two to three years) despite being a big fan of cheap money (as is Ben Bernanke).

The American currency’s reaction was rather mild.

The EUR/USD, which traded for most of the week below the $1.35 level, slightly advanced to $1.355 on Friday. Similarly, the z∏oty market was characterized by low

volatility this past week.

No crucial macroeconomic data was published in Poland, so traders focused on external factors. It has to be noted though that the IMF increased its forecasts for Polish GDP for 2013 and 2014. The numbers from the local economy look good and it seems the IMF forecasts could even be pessimistic (2.4 percent GDP increase in 2014).

Still, it felt like the currency market was almost asleep. The EUR/PLN traded in the z∏.4.18-z∏.4.20 range while the USD/PLN pair traded between z∏.3.08 and z∏.3.11. I expect more action this week with upside potential for both of these currency pairs. ●

currency rates 3.1385 11.10

SOURCE: NBP

3.1908 3.1677 09.10

08.10

07.10

04.10

3.1

10.10

3.1813

3.1812

0 0957 11 10

0.0959

3.1955

100JPY/PLN

3.2

10.10

0.0955

0.0960 09.10

08.10

07.10

0.0961 04.10

3.4041

3.3977 11.10

0.095

0.0961

RUB/PLN

0.097

10.10

3.4168 09.10

3.4110 08.10

07.10

04.10

3.4312

4.9289 11.10

3.3

3.4345

CHF/PLN

3.5

10.10 4.9388

4.9619 09.10

4.9784

4.9578 08.10

07.10

4.9

04.10

3.0850 11.10

3.0994

4.9782

GBP/PLN

5.0

10.10

3.1057 09.10

3.0873 08.10

07.10

3.0902 04.10

4.1918

4.1861 11.10

3.08

3.0976

USD/PLN

3.15

10.10

4.2010 09.10

4.1896 08.10

07.10

4.2065 04.10

4.10

4.2088

EUR/PLN

4.25

22

SPORTS

www.wbj.pl

OCTOBER 14-20, 2013

Tennis

Soccer

Poland top-seeded team at Hopman Cup

All hope is gone The Polish national team

SHUTTERSTOCK

It has been announced that Poland is the top-seeded team in the 2014 edition of Hopman Cup. The country will be represented by Agnieszka Radwaƒska, who is ranked fourth in the WTA standings, and this year’s Wimbledon semifinalist Jerzy Janowicz.

The 2014 edition will mark the first time ever a Polish team has competed in the tournament.

The competition, also known as the World Mixed Team Championships, is the only mixed major tennis tournament. Each finalist sends a team with one male and one female player to represent their country.

Poland’s team took over the top seeded spot, after the runners-up in the 2013 edition, Serbia’s Novak Djokovic and Ana Ivanovic, withdrew from the tournament. The defending champions, Spain’s Anabel Medina Garrigues

COURTESY OF WIKIMEDIA COMMONS

The Polish team will play in the prestigious tournament for the first time, and already they’re one of the favorites to win it

Agnieszka Radwaƒska and Tommy Robredo (who replaces last year’s participant Fernando Verdasco) are the lowest-seeded team going into the 2014 event.

Each year, Hopman Cup organizers invite eight teams to compete in a week-long tournament in Perth, Australia. The other teams that will compete in the upcoming tournament are Italy, the Czech Republic, the US, Australia, France and Canada.

This edition of the competition is somewhat lackluster

when it comes to star power.

Ms Radwaƒska is the topseeded female participant, and the only one besides the Czech Republic’s Petra Kvitova currently in the top 10 of the WTA rankings. The only male participant currently in the top 10 of the ATP standings is France’s Jo-Wilfried Tsonga, who is ranked ninth.

The Hopman Cup begins on December 29, 2013 with the final to be held on January 4, 2014.

Jacek Ciesnowski

After losing to Ukraine by a score of 0-1, Poland’s national team won’t be playing in next year’s World Cup Polish club sides and the national team have all seen a recurring theme in international competition. The Polish side, after putting in a solid effort and missing several good opportunities, loses in the end due to either an individual’s error or a referee mistake.

This was the story of last Friday’s Ukraine-Poland World Cup qualifying game as well.

The Polish team was dominant

through most of the game. It had its chances, particularly before the halftime whistle.

First, Polish defender Kamil Glik hit a header perfectly inside the opponent’s penalty box, but the ball was stopped by a Ukrainian player just before it crossed the goal line.

The other major opportunity for the Polish team was after a great shot by Waldemar Sobota, which Ukrainian goalkeeper Andriy Pyatov managed to save with his fingertips.

In the second half Poland continued to control the game, but in the 64th minute, after a quick counterattack – and a mistake by Polish defender Grzegorz Wojtkowiak –

Ukranian striker Andriy Yarmolenko scored the only goal of the game.

The defeat means that Poland lost any chance it had to qualify for the 2014 World Cup. This week’s game against England will change nothing for the Polish team.

It looks like this qualifying campaign was the first and the last for Poland’s coach Waldemar Fornalik, who will likely lose his job very soon. The question is whether his replacement will have a better idea of how to field the same players and inspire them to put in the same quality of play they do on a regular basis for their club sides.

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

LIFESTYLE

OCTOBER 14-20, 2013

www.wbj.pl

Concert

Books as art

‘Crazy Baldhead’

Artist novels

23

The Book Lovers October 26-27 Museum of Modern Art in Warsaw SHUTTERSTOCK

It’s been a long ride for Irish singer-songwriter Sinead O’Connor. She rose to fame back in the 1980s with the release of her debut album “The Lion and the Cobra,” which sold some 2.5 million copies worldwide. Her biggest success came in the early 1990s, when she covered Prince’s track “Nothing Compares 2 U,” which skyrocketed her to stardom.

What followed was a roller coaster of emotions, with her 1992 appearance on SNL, during which she tore up the pope’s picture, causing a huge media backlash. She was blacklisted from US television for years. The scandal slowed down her career, as each of her following albums sold fewer and fewer copies. She also pursued other endeavors in the meantime. In the late 1990s, for example, she was ordained by the Irish Orthodox Catholic and Apostolic Church as priest. She also appeared in a few films.

Despite all this, she continued to write and release new music. Between 1992 and 2012

SHUTTERSTOCK

Sinead O’Connor 27 October Sala Kongresowa Warsaw

Sinead O’Connor she released seven albums, during which time she experimented with various genres, including roots reggae and Irish folk.

She also collaborated with many musicians, ranging from Peter Gabriel and Roger Waters to Massive Attack and the Asian Dub Foundation.

Ms O’Connor will be visiting Warsaw as part of her “The Crazy Baldhead Tour,” pro-

moting her latest album “How About I Be Me (And You Be You)?” Fans who had a chance to see her in action on her current tour call it Ms O’Connor’s “return to form.” It will be her second show in Poland this year, as she played in Wroc∏aw back in June as part of the WrocLove Fest.

Jacek Ciesnowski

Ticket prices start at z∏.90

The goal of “The Book Lovers” project is to study and promote books written by artists, so called “artist novels.”

In the last 15 years, many creators have chosen the novel as their artistic medium. Such artists don’t simply write books with stories and narration.

They use its pages like the painter uses canvas, or a sculptor uses clay. The artist novel introduces elements particular to narrative literature into the visual arts, like fiction, identification and even issues of

authorship.

Some artist novels link text with the audiovisual arts, such as movies, soundtracks or even performances. One example of such pieces of art is a project put together by Tom McCarthy – one of the event’s guests – based on Jean Cocteau’s film “Orpheus.” In 2004, Mr McCarthy and his assistants cut up the text, re-assembled it and transmitted it throughout the world via the internet as a series of cryptic messages.

Another example of rearranging books to form art is “Getting Inside Jack Kerouac’s Head,” by Simon Morris, who will also be attending The

Book Lovers event. His “book” is simply Jack Kerouac’s monumental “On the Road” with the pages in reverse order.

The two-day Book Lovers event will feature a series of discussions, panels and performances by the world’s leading authors and curators of this new and fast-evolving genre.

The event is curated by David Maroto, a Spanish artist based in the Netherlands and Joanna Zieliƒska, a curator at the Centre for the Documentation of the Art of Tadeusz Kantor.

Jacek Ciesnowski

For more information visit news.cricoteka.pl/the-book-lovers

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