WBJ #5 2013

CIA prisons in Poland?

EXCLUSIVE

A European court declassifies documents in an investigation into whether Poland helped the US detain terrorism suspects

WBJ interviews Minister of Labor W∏adys∏aw Kosiniak-Kamysz about new initiatives to fight unemployment 8-9

WWW.WBJ.PL

3

VOLUME 19, NUMBER 5 • FEBRUARY 11-17, 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

Hot rod or lemon?

COURTESY OF GEMINI HOLDINGS

REAL ESTATE

• Poznaƒ City Center • Intelligent buildings • Youth center in a mall 15-18

3.75% - the NBP cut interest rates for the fourth month running 4

News . . . . . . . . . . . . . . . . . . . . . . .2-4 Business . . . . . . . . . . . . . . . . . . . .5-6 Finance & Economics . . . . . . . . . . .7 Interview . . . . . . . . . . . . . . . . . . .8-9 Opinion & Analysis . . . . . . . . . . . .11 Cover Story . . . . . . . . . . . . . . . . . .13 Lokale Immobilia . . . . . . . . . .15-18 The List . . . . . . . . . . . . . . . . . . . . . .19 Markets . . . . . . . . . . . . . . . . . . . . .20 Sports . . . . . . . . . . . . . . . . . . . . . . .21 Lifestyle . . . . . . . . . . . . . . . . . . . . .22 Last Word . . . . . . . . . . . . . . . . . . . .23

¸UKASZ MAZUREK/WBJ/SHUTTERSTOCK

In this issue

Will the government’s new investment vehicle be a speedster or a slacker? The experts weigh in 13

Big bucks for Poland

Road to corruption

EU leaders cut the bloc’s budget, but Poland is set to receive billions more than it did last time

Details emerge in a scandal over alleged price-fixing on road 4 contracts

3

NEWS

www.wbj.pl

3.75% is the current reference interest rate in Poland, after the Monetary Policy Council cut it by 25 basis points for the fourth month in a row.

€9.6 million

is the cost of building one kilometer of motorway in Poland, according to data published by Dziennik Gazeta Prawna.

z∏.22 is the share price in the upcoming IPO of Polski Holding NieruchomoÊci, set for February 13.

Quote of the Week

While trying to show his liberal face to his voters, Janusz Palikot might have instead shot himself in the foot.

The founder and president of socially liberal party Palikot’s Movement wanted to remove its representative, Wanda Nowicka, from the post of deputy speaker of the Sejm (the lower house of Polish parliament). Ms Nowicka earned Mr Palikot’s ire after she accepted a controversial bonus for her work in parliament. Mr Palikot wanted to replace her with Anna Grodzka, Poland’s first transgender MP. After it became clear that Ms Nowicka wouldn’t be

Unemployment at 14.2% in Jan The Ministry of Labor estimates that the unemployment rate in January rose to 14.2% (0.8% more than in December 2012). At the end of January the number of all registered unemployed rose to some 2.3 million, 159,000 more than in December. ●

voted out of her position because all of the other parties in parliament intended to vote against her dismissal, Mr Palikot asked her to resign.

She refused. “I’ll accept every decision that the Sejm makes; it will be a democratic process,” she told the press after meeting with Mr Palikot.

In the end, 245 MPs voted against dismissing Ms Nowicka, including Ms Grodzka, while only 45 voted to strip her of the position.

Mr Palikot fumed. “I’m sad and disappointed. I regret that she did what she did, because she destroyed herself and what she stood for.” At a meeting of his party’s MPs he recom-

mended Ms Nowicka be removed from the party.

After a heated debate, the decision was postponed for this week. Mr Palikot explained that Ms Nowicka wants to “cooperate” and he’s “waiting for her proposal.”

However, he added that he still thinks she should be removed from the party.

The issue had made headlines for the last several weeks, but Ms Grodzka kept her poise. After she was asked if she regrets not getting the chance to become the world’s first transgender deputy speaker, she simply answered, “No, not at all.”

Jacek Ciesnowski

“My signature is required for [the] definitive adoption of [the] budget, I cannot, will not and may not accept what amount to deficit budgets.”

Martin Schulz, president of the European Parliament, on Twitter, arguing against proposed cuts to the EU budget.

Figures in focus Spending galore Budget increase between 1999 and 2011 (in %) 250 *Highest in the EU **Lowest in the EU

200 150 100 50

On WBJ.pl A post-growth world?

We need a stark re-evaluation of the levels of growth we expect over the long term, argues Princeton University’s Ashoka Mody. “We lived the better part of the subsequent decade with a misguided sense of extended prosperity and inflated a financial bubble. Worse, we are treating the present as if the bubbly growth from 2000 to 2007 will return.” For more, log on to WBJ.pl this week.

Cz ni ec hR a ep ub lic Hu ng ar y Po la nd Gr ee ce Fra Eu nc rop e ea nU Un nio ite n dK ing do m Ge rm an y* *

0

IBnGR: 2013 GDP to grow by 1.4% The Gdaƒsk Institute for Market Economics (IBnGR) expects Poland’s GDP to grow 1.4% this year. In 2014, the think tank sees GDP growth rising to 2.3%.

The institute’s forecasts place CPI inflation at 2.4% in 2013 and at 2.9% in 2014, with the unemployment rate up to 13.8% at end-2013 and then down to 13.1% a year later.

€960 billion

is the size of the proposed EU budget for 2014-2020 that European Union leaders agreed to at a summit last week.

ia*

According to a survey by Dom Badawczy Maison, only 15% of Polish entrepreneurs are willing to vote for the Civic Platform (PO) party, a huge drop from the 49% it obtained in the last such poll in August 2011.

Support for other parties among businesspeople is even lower: 9% say they support Law and Justice, 5% support the Democratic Left Alliance and Palikot’s Movement each, while 2% would vote for the Polish People’s Party. Over half of the businesspeople surveyed either would not vote or do not know which party to support.

Wanda Nowicka

Es to

PO losing support of business community

Numbers in the News

an

President Bronis∏aw Komorowski has signed the documents allowing Polish troops to participate in the EU training mission in Mali.

The military contingent will include no more than 20 instructors, and they will be involved in the mission from February 16 until the end of this year.

The soldiers will train bomb-disposal units and special forces troops. They will not take part in any active combat missions.

IN THE SPOTLIGHT

Ro m

Komorowski approves sending troops to Mali

FEBRUARY 11-17, 2013

COURTESY OF WIKIMEDIA COMMONS

2

Sources: Eurostat, European Parliament, European Commission

Company index Agora ........................................................6

Ivona Software..........................................6

Aiga Investments....................................15

KappAhl ..................................................17

Allegro ......................................................6

Karnic Powerboats Ltd ..........................10

Alshaya Group ........................................17 Amazon ....................................................6

KGHM......................................................13 Leroy Merlin ..........................................15

Bank Gospodarstwa Krajowego ............13 Biedronka ................................................6

CALENDAR

February 12 Event:

Location:

Web:

INTELLECTUAL PROPERTY RIGHTS MANAGEMENT This seminar will address issues of intellectual property rights such as: developments in cloud computing and their legal consequences, risks of cross-border contracts and resolving disputes.

TGC Corporate Lawyers, Crown Tower, 11th floor, Terraces Conference Center, ul. Hrubieszowska 2, Warsaw bpcc.org.pl

19

PROPERTY FORUM POZNAŃ

Event:

Another edition of this series of regional conferences will take place in Poznaƒ. The current commercial real estate situation in the Wielkopolskie voivodship will be discussed.

Local authorities, developers, investors and commercial space tenants will take part in a

Location: Web:

series of discussions.

Sheraton Hotel, ul. Bukowska 3/9, Poznaƒ propertynews.pl

Boston Consulting Group ........................6

BRITISH POLISH HEALTHCARE FORUM

Event: Subtitled Creating Opportunities in the Polish Health System – Effective Management and Finance, this forum aims to promote UK best practice in health care facility and hospital management to key stakeholders in Polish hospitals, with a focus on secondary and tertiary care. This event will be in the form of an up-to-date briefing on opportunities in the health sector in Poland, and will deliver concrete business-development opportunities for companies attending, as well as longterm follow-up prospects.

Location: British Embassy, ul. Kawalerii 12, Warsaw Web: bpcc.org.pl

Merlin.pl ..................................................6

Business Center Club ............................13

NEUROWEAR ........................................23

Carrefour ............................................6, 17

Nokaut Group ..........................................6

CCC ........................................................17

PGE ........................................................13

Colliers International ............................15

PGNiG ....................................................13

Cubus......................................................17

Piotr i Pawe∏ ..........................................17

Czerwona Torebka....................................6 Deichmann ............................................17

21

Lidl ..........................................................17

PKO BP ..................................................13 Polish State Railways ............................17

Demetriades Group................................10 Dom Badawczy Maison............................2 Douglas ..................................................17

Polski Holding NieruchomoÊci................2 Rossmann ..............................................17

Elcora Renewable Energy Solutions ....10

Saturn ....................................................17

Elysee Plastic Pipes and Fittings ..........10

Superpharm ..........................................17

Empik........................................................6

Terranova................................................17

Enfoton Solar Ltd ..................................10

Tesco ..................................................6, 17

Exalo Drilling..........................................13

TK Maxx ..................................................17

FIREBOX ................................................23 FirePro Systems Ltd ..............................10

Toys ‘R’ Us ..............................................17 TriGranit..................................................17

Frisco.pl....................................................6 G & L Calibers Ltd ................................10 Géant ......................................................17

TVN ........................................................20 UBM ........................................................15

Gemini Holdings ....................................17

X-Trade Brokers ..............................13, 20

Growler On Board ..................................23

ZX Fami ..................................................10

H&M........................................................17

˚abka ........................................................6

NEWS

FEBRUARY 11-17, 2013

www.wbj.pl

3

European Union

Poland has emerged as one of the big winners of the EU budget negotiations After hours of heated negotiations, EU leaders agreed to cut a further €12 billion from the bloc’s most recent longterm budget proposal last week, bringing the total size of the budget down to €960 billion for the 2014-2020 period.

The EU summit was a clash between two camps, one led by the UK, which wanted to cut the budget proposal, submitted in November, by as much as €30 billion. The other was headed by France, with vocal support from Poland, which wanted to keep the November proposal intact. Somewhere in between was Germany, which tried to bridge the gap between these two factions.

When the summit started without a new proposal from European Council President Herman Van Rompuy, every-

one predicted a long night of discussions, arguments, and calculations. But soon reports of agreement began to emerge.

The only problem that remained for the politicians was figuring out how to emerge from the talks as victors and to be seen in their countries as successful negotiators. The leaders got down to discussing precisely where and how much to cut, and how to sell the agreement to the public.

Finally, at around 6 am CET on Friday, Reuters reported an unnamed EU official as saying, “We feel pretty confident that we have the framework for a deal.”

“The deal is not completely finalized, but we feel sure it will be done today,” the source added.

After another few hours of talks, new details emerged that Poland had received a favorable deal. The country would

COURTESY OF KPRM/FLICKR

Europe agrees on budget, Poland to receive billions more

Prime Minister Donald Tusk cuts a euro cake in celebration of Poland's budget “victory” receive €106 billion over the course of the next seven years (compared to the €101.5 that it got in the current 2007-2013 budget). Cohesion policy funds for Poland would increase from €69 billion to €72.8 billion, while funds for agriculture would increase from €26.9 billion to €28.5 billion. Another €200 million is designated for Poland to fight

youth unemployment.

Prime Minister Donald Tusk grinned widely and claimed victory, since Poland would be receiving €5 billion more than in the current budget, despite the overall budget being cut by some €40 million in comparison with the 20072013 plan.

“This is one of the happiest days of my life,” the prime

minister told reporters. “I don’t think I will ever be able to do something like that for Poland again,” he added, indicating how great he felt the achievement was.

At last, after a short second round of discussions, all the parties involved announced the successful end of budgetary talks.

The final agreement was

deemed a success in most EU countries. The Daily Telegraph called it “a major victory for David Cameron.” Leszek Miller, from Polish opposition party the Democratic Left Alliance, suggested jokingly on Twitter that Mr Tusk “grab the [proposed] money and run.”

None of this means, however, that the budget is finalized.

Now the European Parliament will have to vote on it, and its passage isn’t certain. During the summit, EP President Martin Schulz repeated often that he would not approve a 2014-2020 budget that was smaller than the one for 20072013.

For the first time in history, the EP’s vote on the budget will likely be secret, freeing MEPs from the political obligation to vote with their national parties and increasing the chances that the budget will be voted down.

Jacek Ciesnowski

Politics

Polish officials claim declassifying the materials on alleged CIA prisons may be a threat to Poland’s security Poland’s government continues to avoid answering the European Court of Human Rights’ questions about the existence of CIA detention facilities in Poland and how much Polish officials knew about them.

The matter came to light last Tuesday when the court decided to declassify documents pertaining to the complaint by Abd al-Rahim alNashiri, a Saudi national, accused of being the Al-Qaeda mastermind behind the bombing of the American destroyer USS Cole in 2000. In May 2011 Mr al-Nashiri filed a complaint with the ECHR claiming he had been detained in a CIA prison in Poland between 2002 and 2003.

The European court decided to lift the lid on the investigation in view of the apparent lack of cooperation from Polish officials in providing information relevant to Mr alNashiri’s allegations.

Among the declassified documents is a letter from Pol-

ish officials sent to the Court in Strasbourg in September 2012, stating that public prosecutor’s office had been investigating the accusations since 2008 and explaining the reason for the refusal to comply with ECHR’s request.

“By addressing in detail the questions submitted by the Court ... the government could be seen as interfering with the competencies of the prosecution and judiciary authorities, which are independent of the government in Poland,” the letter reads.

The ECHR informed Polish officials in July 2012 about Mr al-Nashiri’s complaint and presented them with a list of questions about the alleged existence of CIA prisons on Polish soil.

Government representatives claim they want to cooperate with the Strasbourg Court but argue that the ongoing criminal investigation in Poland still makes it impossible for them to answer the Court’s questions. The Polish government also asked the Court to limit public access to any information on the case.

Poland’s security in danger?

Several politicians explained that the documents in the pub-

lic prosecutor’s investigation are classified and that making them public could pose threat to Poland’s security.

Justice Minister Jaros∏aw Gowin called the court’s decision disturbing. “I can assure you that the government will do its best to ensure that the security of Polish people is not threatened,” he said. When asked about his knowledge regarding the existence of CIA facilities in Poland, Mr Gowin replied that he had no reason to believe that such CIA prisons existed in Poland.

Poland’s Ministry of Foreign Affairs said it was disappointed and surprised with the Court’s decision. Maciej Szpunar, undersecretary of state in the ministry, said, “The court must be aware that the decision to declassify all the information provided by the Polish government will result in limiting our ability to cooperate.”

Globalized torture?

The news about the declassification of the documents in alNashiri’s case coincided with the publication of a report by the Open Society Justice Initiative (OSJI) called “Globalizing Torture: CIA Secret Detention and Extraordinary Rendition.”

The OSJI’s work is believed to

be the most detailed report about the alleged help that the United States received from other countries.

The report contains a list of 54 foreign governments which reportedly rendered some kind of assistance to the CIA after the terrorist attacks of September 11, 2001, either by allowing the CIA to run secret detention facilities or by letting the agency use airports while moving prisoners around the world.

Among other European, Asian, and African countries the OSJI listed Poland. The report gives the names of six individuals who allegedly were held in CIA prisons in Poland.

Marta Mardosz

SHUTTERSTOCK

Poland still refuses to answer to allegations about CIA secret prisons on Polish soil

Alleged detainees in secret CIA prison in Poland Waleed Mohammed bin Attash – a Yemeni national, allegedly detained in Poland in March 2003.

Abu Bakr Muhammad Boulghiti – an Algerian national, allegedly held in Poland in 2003.

Khalid Sheikh Mohammed – a Pakistani national, allegedly detained in Poland in 2003 and reportedly tortured by waterboarding. According to a leaked report by the International Committee of the Red Cross, he learned that he was in Poland when he received a bottle of water with a Polish label.

Abd al-Rahim al-Nashiri – a Saudi national, allegedly secretly detained in Poland from about December 5, 2002, to June 6, 2003 and allegedly subjected to various forms of torture.

Ramzi bin al-Shibh – a Yemeni citizen, allegedly brought to Poland on March 7, 2003, and detained for three months.

Abu Zubaydah – a stateless Palestinian, allegedly flown into Poland on December 5, 2002, and held for nine to 10 months.

Source: Open Society Justice Initiative

4

NEWS

www.wbj.pl

EU funding

FEBRUARY 11-17, 2013

Monetary policy

Shocking details in Polish RPP cuts interest rates road cartel case for fourth month in a row

Shocking details about how a road-construction cartel allegedly operated were revealed in local Polish media last week. The tactics used included price-fixing, bribes, and undermining quality-control inspections.

Among the 11 people now charged in the case are 10 executives who worked for construction firms, including large international ones, and one former director of Poland’s General Directorate for National Roads and Motorways (GDDKiA). The European Commission has suspended some z∏.3.5 billion worth of funding for Polish roads until it receives assurances that the alleged fraud could not be repeated on other projects.

‘Hotel’ code One of the prosecutors in this

case, Zbigniew Jaskólski, explained in an interview with TVN24 how the cartel operated. “A group of employees of construction firms had access to confidential data from one of the GDDKiA directors.

They knew exactly how much the agency could spend on every project, and they divided them between themselves.”

In one wiretap cited in the court documents, the man who at the time was an executive in one of the companies tells an executive from another company in June 2009: “At this Hilton, there will be three rooms. ... You will have room number 698.” The room number, prosecutors say, was code for the lowest bid the company should submit.

The idea was that entire road construction projects would be split equally between firms. “The company that didn’t win one tender, won another one in a different part of the same road,” added Mr Jaskólski.

According to Reuters and Forbes, the companies whose current or former executives have been charged include some of Europe’s biggest

builders or their Polish subsidiaries: Austria’s Strabag and TEERAG-ASDAG, Portugal’s Mota Engil, units of Spain’s Ferrovial, France’s Bouygues Construction and Vinci, as well as Poland’s Mostostal Warszawa.

Most of the companies involved have so far declined comment or denied any wrongdoing.

Bribes galore In documents submitted to the court, prosecutors allege that one executive bribed the GDDKiA official with a gold-embossed limited-edition fountain pen, which was worth $3,800 and came in a glass case shaped like the ancient Lighthouse at Alexandria.

Another recorded conversation shows how two executives were discussing what to buy for the GDDKiA official as a name-day present. They complain that a particular painter’s artwork, some of which they had bought for him previously, had risen in price from z∏.15,000 to z∏.50,000.

Jacek Ciesnowski

And despite previous statements that the easing period was “nearing an end,” it seems likely that more cuts are coming For the fourth month running, the National Bank of Poland’s rate-setting committee, the Monetary Policy Council (RPP), cut its reference interest rate by 25 basis points, to 3.75 percent. The last time the main rate was this low was back in March 2011, after which the council raised rates by 25 bp three months in a row.

The RPP was the only ratesetter in Europe to raise interest rates last year, when it did so in May, again by 25 bp. As economic indicators showed a slowing down of the Polish economy, the council was reluctant to cut rates, but finally began doing so in November of last year. A full percentage point has now been chopped off of Polish borrowing rates since then.

Recent macroeconomic data releases have shown a marked slowdown in inflation – to below the NBP’s target of

2.5 percent – as well as in consumption and economic growth in general. Last month, the country’s statistics office GUS announced that in 2012 Poland’s economy grew by just 2 percent, its weakest rise since 2009. Private consumption, whose strong performance during 2009-2010 was credited for Poland’s ability to escape the global economic crisis without going into recession, has now dipped into negative territory.

Several government officials, including Finance Minister Jacek Rostowski, had called on the council to continue cutting rates. While a

cut had been widely favored by economists, there was some doubt as to whether the council would come through after NBP president and head of the RPP, Marek Belka, said in January that the council’s easing cycle was “nearing an end.”

However, in the communique released after the meeting the RPP retained a dovish tone. NBP president Marek Belka emphasized that there was no reason to believe that the council wouldn’t cut in March, but rather that “all options are possible.”

Andrew Kureth

Steep drop The National Bank of Poland’s reference interest rate, February 2011-February 2013 5.0 4.5 4.0 3.5 3.0 Fe b Ma . '11 r.

Ap '11 r.

Ma '11 y Ju '11 n.

Ju '11 l.

Au '11 g Se . '11 p Oc . '11 t.

No '11 v De . '11 c Ja . '11 n.

Fe '12 b Ma . '12 r.

Ap '12 r.

Ma '12 y Ju '12 n.

Ju '12 l.

Au '12 g Se . '12 p Oc . '12 t.

No '12 v De . '12 c Ja . '12 n.

Fe '13 b.

'13

Splitting up contracts and bribing government officials was allegedly all in a day’s work for construction firms working on Polish roads

Source: National Bank of Poland

SUBSCRIBE FOR 1 YEAR AND SAVE UP TO 50% OFF THE COVER PRICE Choose one option by checking the box

❏ WBJ IS NOW AVAILABLE IN DIGITAL FORMAT. READ WBJ AS A PDF OR E-ZINE.

OPTION 1

WBJ Electronic

Wa Warsaw Business Journal PDF version and a link to view WBJ in e-zine format delivered to your e-mail address each week for 12 months. for Everywhere: zł.424

❏

OPTION 2

WBJ Print

ENQUIRIES AM I C HA LI K @ VA L K EA .C O M, O R C AL L + 4 8 ( 2 2 ) 6 78-9912

In Europe: €297

OPTION 3

Outside Europe: €374

WBJ Premium

Warsaw Business Journal print edition delivered each week to your address for 12 months, plus WBJ PDF version and a link to view WBJ in e-zine format delivered to your e-mail address each week.

Also receive Investing in Poland 2012 (zł.78 value) and Book of Lists 2012 (zł.100 value).

In Poland: zł.691

Warsaw Business Journal print edition delivered each week to your address for 12 months, plus receive Investing in Poland 2012 (zł.78 value) and Book of Lists 2012 (zł.100 value).

In Poland: zł.550

❏

In Europe: €330

Outside Europe: €407

Please fax this form to: +48 22 639 85 69 or mail it to our office: Subscriptions Warsaw Business Journal Valkea Media S.A. ul. Elblàska 15/17, 01-747 Warsaw, Poland

CLIENT DETAILS

PAYMENT OPTIONS (please check one)

Name ......................................................................................................................

Company ......................................................................................................................

Address ......................................................................................................................

Postal code ......................................................................................................................

City ......................................................................................................................

Country ......................................................................................................................

Telephone/Fax ...................................................................................................................... e-mail ......................................................................................................................

NIP (Poland)/EU VAT number (EU countries) ......................................................................................................................

❏ Pre-payment by bank transfer upon receipt of a pro-forma invoice. The pro-forma invoice will be sent to you immediately upon receipt of your order.

Your subscription will start within one week of payment. ❏ Credit card: ❏ American Express

❏ Visa

❏ Mastercard

Cardholder name ......................................................................................................................

Number ......................................................................................................................

CVV2/CVC2/CID

Expiration date

....................................................... ............................................................

Signature ......................................................................................................................

BUSINESS

FEBRUARY 11-17, 2013

Airlines

Real estate holding Polski Holding NieruchomoÊci (PHN) set the share price for its upcoming IPO at z∏.22 apiece.

Exactly 9,219,100 shares were offered to institutional investors and 1,626,000 to individual investors, meaning that a 25 percent stake in the company will be sold. The total value of the IPO will come in just below z∏.239 million. PHN is to debut on the stock exchange no later than February 13.

The price would value the whole group at up to z∏.956 million, closer to the lower end of the z∏.870 million to 1.7 billion range targeted by the banks running the offer. The originally proposed price of z∏.26 per share was evidently deemed too high by potential investors.

Currently, PHN’s only shareholder is the Polish Treasury, which is also looking for a strategic investor for the firm.

Once it sells a controlling stake to the strategic investor, the state wants to maintain a stake of between 20 and 25 percent of the company.

PHN manages 150 properties valued at a total of z∏.2.1 billion. The best-known of these is the Intraco building in Warsaw.

For the first three quarters of 2012, the company posted a net loss of z∏.143 million.

KW, JC

COURTESY OF PHN

COURTESY OF LOT

The former CEO is heading the firm again, after the treasury minister demanded he be taken into consideration

Sebastian Mikosz plan to reorganize the firm and save it from bankruptcy.

His nomination was announced immediately after the meeting.

Mr Mikosz was in nearconstant conflict with unions during his previous tenure as LOT’s CEO, due to his harsh restructuring plans for the company. He left as a result of his apparent inability to reach

5

PHN sets share price at z∏.22

Mikosz back in the pilot’s seat at LOT

Sebastian Mikosz, who served as head of national airline LOT between 2009 and 2010, was chosen on Wednesday to again take the post of CEO at the troubled state-owned firm.

The decision will be crucial to the future of many. Not only will it effect how the airline looks to avoid bankruptcy, but it could also determine whether Treasury Minister Miko∏aj Budzanowski keeps his job.

“So far, Minister Budzanowski’s actions in the matter of LOT have not been satisfactory,” said Prime Minister Donald Tusk in January, making it clear that if the ministry’s plan to save LOT was not up to the PM’s liking, Mr Budzanowski would lose his post.

Mr Mikosz was therefore hand-picked by Mr Budzanowski. His name was not on the shortlist of five potential candidates invited for an interview with LOT’s supervisory board, though he was on the original list of over 20 candidates for the CEO position.

On Tuesday, the treasury minister demanded that Mr Mikosz be interviewed, local media reported. A day later he was invited to appear before the supervisory board to present his

www.wbj.pl

compromise with the workers’ representatives.

This time however, his tough policies may be just what the government is looking for. LOT is in dire need of restructuring, which will certainly involve mass layoffs.

According to various estimates, it could fire as many as 600 of its 2,300 employees.

The Intraco building in Warsaw is one of PHN’s best-known properties

Jacek Ciesnowski

Labor regulations

Gov’t introduces subsidies, flex-time to prevent job cuts The Labor Ministry is pushing new legislation that it hopes will help keep employees on the payroll Poland’s government has announced plans to subsidize workers’ salaries for firms whose revenues fall by 15 percent. Companies who fulfill the requirements will receive z∏.794 per month – equal to the unemployment benefit – to put toward the salary of each employee it keeps on the payroll. Companies will then have to make up the difference in the employees’ salaries on their own.

“Instead of doling out benefits, it’s better to subsidize salaries for a while. This way, workers get to keep their jobs,” Minister of Labor

W∏adys∏aw Kosiniak-Kamysz told Gazeta Wyborcza.

In order to receive the subsidies, a company will have to produce proof of substantially weaker performance. A 25 percent drop in revenues was the original threshold proposed, but “after a series of talks with trade unions and employers, we decided to lower it to 15 percent,” Mr Kosiniak-Kamysz said.

The government also wants to cut some red tape for employers filing for subsidies.

Companies won’t have to submit a reorganization plan or file for the so-called “precarious financial standing” status to receive government help.

Flex-time Another initiative the government is taking to prop up

employment is introducing more flexible work hours to Polish labor law. The government adopted draft legislation on the matter last week. (see interview, p. 8-9) If the changes are passed by parliament, firms will be allowed to reduce the number of hours their employees work when times get tough, or extend it when business picks up.

The new rules will replace anti-crisis legislation in force between 2009 and 2011 which was designed to cushion the blow the global economic slowdown dealt the labor market.

If the Sejm adopts the proposal, it would become binding in the second quarter of 2013.

Beata Socha

www.bilans.eu

6

BUSINESS

www.wbj.pl

FEBRUARY 11-17, 2013

Retail

Rapaczynski takes the reins again at Agora

Poland is the fastest-growing e-commerce market in EU: report

The former CEO takes over a media company that has seen its stock price drop precipitously since she was at the helm

Rising internet access and the search for lower prices is driving the increase

Wanda Rapaczynski the firm publishes its 2012 results. The sales of Agora’s flagship newspaper have fallen sharply in recent years. In December 2012 it sold on average 258,380 copies daily, compared to a circulation of over 600,000 in 2007.

But dropping sales has been an issue facing the entire sector for years, and some analysts argue that Mr Niemczycki’s

radical cost-cutting policies kept the paper going.

Agora’s stock price has fallen by around 50 percent under Mr Niemczycki’s tenure, but with financial troubles across the board in the print media sector, analysts were reluctant to place blame. In the first three quarters of 2012 Agora recorded a net loss of z∏.9 million.

Beata Socha

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

Longer work time calculation period On February 5, 2013 the government adopted draft legislation amending the Labor Code Act. According to the proposed changes, employers will have more leeway in adjusting the working schedule to fluctuations in their workload.

Generally, working time may not exceed eight hours in a 24-hour period and an average of 40 hours in an average five-day working week during the applicable calculation period. The difference is that now the calculation period has been extended from 4 months to up to 12 months.

The changes in the working schedule must be justified by objective, technical or work-scheduling requirements. If employees are not entitled to remuneration in a given month due to the adopted work schedule, they will still receive the minimum wage for that month.

Thanks to the proposed amendments companies (especially large ones) will have some more flexibility and will be able to limit the number of layoffs, for example by cutting short their employees’ working hours when the workload decreases or by extending the working time without having to pay for overtime when the number of orders rises.

Duty to label all appliances that require the use of energy The Act of September 14, 2012 on label-

ing obligations for products that require the use of energy came into force on February 1. The legislation pertains to products which consume energy or products that, while not electrically powered, require the use of electricity to operate.

Previously, the requirement to report energy consumption by such products only applied to household appliances. The Act expanded the requirement to all products influencing energy consumption for which the European Commission specifies requirements for drawing up technical documentation, labeling and attaching product description cards.

The Act imposes a number of requirements on suppliers and distributors. One of these is the duty to label all products that require the use of energy and supplying them with product description cards that include information on the product’s energy-efficiency class and its technical parameters. Both the label and the card should be in Polish.

Moreover, advertisements for such products should include information about their energy-efficiency class.

Failure to comply with these requirements will be punishable by fines equivalent to 5-20 times the average monthly salary. The average monthly salary for 2012 will most probably amount to approximately z∏.3,550 (official data of the Central Statistical Office are not available at the moment). ●

BROUGHT TO YOU BY PETER NIELSEN & PARTNERS LAW OFFICE

Poland is the fastest growing e-commerce market in the EU, according to a report by the Centre for Retail Research.

As recently as 2011, Poland was second-to-last in terms of percentage of retail business done online in a ranking with 13 other European countries.

The UK topped that list, while only Italy had a smaller percentage of retail trade than Poland. According to lobby organization Ecommerce Europe, Poland’s online sales grew between 25 and 30 percent year-on-year in 2012.

Allegro, Poland’s largest auction site, has more than 12.5 million users who in 2012 did business with each other to the tune of some z∏.10 billion. To put that in perspective, total e-commerce sales in Poland came to z∏.23.7 billion.

Outside of Allegro, the rise in sales was some z∏.2 billion.

Wojciech Czernecki, head of the Nokaut Group, an online price-comparison portal, told daily newspaper Rzeczpospolita that the growth of the online retail business is the result of consumers’ wallets getting thinner.

“During an economic slowdown, consumers are more willing to look for cheaper prices, that’s why the whole sector looks like it will grow strongly,” he said.

Rising internet access is another key driver. Based on a study by the Boston Consulting Group, 67 percent of Polish households had access to the internet in 2011. That number is expected to increase to 75 percent by the end of 2015.

In the face of this rapid growth, companies such as France-based supermarket chain Carrefour and UKbased competitor Tesco have

recently introduced features that allow Polish consumers to buy products online and pick them up at drive-in locations. Polish online grocery stores such as Frisco.pl have enjoyed popularity for some time.

US e-commerce giant Amazon recently made waves in the Polish market with its purchase in January of Polish IT company Ivona Software, a maker of text-to-speech software. For years there have been reports in the Polish media that Amazon is considering opening a Polish version of its service.

Daniel Schmuck

SHUTTERSTOCK

Former Agora CEO Wanda Rapaczynski is temporarily taking up her former post at the Polish media giant again, following the resignation of Piotr Niemczycki, who had led the company since 2008.

Ms Rapaczynski led the company from 1998 until 2007, and thereafter remained involved with Agora, serving on the firm’s supervisory board.

The board has now nominated her interim CEO, for three months starting on February 12.

Ms Rapaczynski helped found Gazeta Wyborcza, Poland’s highest-circulating quality daily, and Agora’s flagship publication.

She was ranked 5th in Europe’s Top 25 Women in Business ranking by the Financial Times newspaper in 2006.

No reasons were given for Mr Niemczycki’s resignation, but it comes two weeks before

COURTESY OF AGORA

Media

Poland’s online sales grew by as much as 30 percent last year

Czerwona Torebka to take over Merlin.pl?

Czerwona Torebka, which manages a network of shopping centers, has signed a preliminary agreement to buy 99.6 percent in Merlin.pl, one of Poland’s oldest and largest online retailers.

Czerwona Torebka will take over Merlin.pl in exchange for newly issued shares.

If the acquisition goes through, Czerwona Torebka would like to install Merlin points for clients to pick up their orders placed online. “This solution will offer Merlin.pl a way to reach its clients directly. The number of personal delivery points could be up to 4,500. It will also allow Czerwona Torebka group to get another tenant for its malls, and generate a considerable amount of customer inflow,” Czerwona Torebka said in a statement.

Merlin.pl has been a takeover target for quite some time now. In mid-2010, it was announced that sector giant Empik would take over Merlin.pl, but the deal failed to win approval from regulators.

Merlin.pl is one of Poland’s oldest internet retailers Czerwona Torebka’s takeover will need to be approved by regulators as well.

Czerwona Torebka is a WSE-listed company, founded

by Mariusz Âwitalski, who created popular retail discount chains Biedronka and ˚abka. It currently operates 79 sites and by the end of 2021 it plans to open

1,900 shopping arcades across Poland.

Merlin.pl is one of the oldest Polish e-retailers. It was founded in 1998 as an internet bookstore.

It later expanded into selling other products, such as electronics and toys. In 2012 it recorded a z∏.3.8 million net loss.

JC, KW

FINANCE & ECONOMICS

FEBRUARY 11-17, 2013

Wages

SHUTTERSTOCK

Mazowieckie voivodship, where Warsaw is located, boasts the highest average salary among workers in the private sector, according to Poland’s statistical office GUS, which made its calulations based on data from the first three quarters of last year.

The average gross monthly salary in Mazowieckie came to z∏.4,600, compared to the nationwide average of z∏.3,700.

Piotr Bujak, chief econo-

mist for Poland at Nordea Bank, told WBJ that many foreign companies have their headquarters in Mazowieckie, leading to the higher average salary.

Silesia voivodship, in the south, placed second in the ranking while Pomorskie voivodship, in the north, was third. The average salaries were z∏.3,900 and z∏.3,800 respectively.

But there is a distinct gap between the richest and poorest voivodships, with average salaries in some significantly lower than the national average. In the

7

Piechociƒski: exports to be a driving force for Polish economy

Highest salaries in Mazowieckie voivodship Among Polish cities, Katowice beat out Warsaw for the top spot

www.wbj.pl

Warsaw placed second in terms of highest average salaries among cities Warmiƒsko-Mazurskie, Podkarpackie and Lubuskie voivodships, salaries averaged some z∏.3,100 and were the lowest in the country.

According to Mr Bujak, companies are reluctant to invest in these regions due to their low level of economic devel-

opment.

When it comes to average monthly salaries in Polish cities, Warsaw ranked second, with z∏.4,800. Katowice, the capital city of Silesia, voivodship came in first, with an average salary of z∏.5,000.

Marta Mardosz

Deputy Prime Minister and Minister of Economy Janusz Piechociƒski believes that in the near future exports will become the main driver for Poland’s economic growth.

During a press conference in Tomaszów Mazowiecki last week, Mr Piechociƒski said that he expects further development of foreign trade with countries to Poland’s east, including Azerbaijan, Belarus, Kazakhstan, Turkey and Uzbekistan.

Mr Piechociƒski also said that Polish companies should look to increase trade with the Baltic states, Brazil, Canada, India and Mexico. “Most of the projects the Ministry of Economy is working on this

year are focused on those markets,” he said.

Polish firms have been slowly shifting their exports away from Western Europe in favor of markets in the CEE region and markets further to the east. Experts say this could be the result of the protracted European economic slowdown, as Polish companies try to take advantage of faster-growing economies outside of the euro zone.

Polish foodstuffs, especially, were a hit in 2012. In fastgrowing markets such as Saudi Arabia, Syria, the United Arab Emirates and Yemen, Polish food has become very popular.

Marta Mardosz

Foreign investments

UN report: Poland’s FDI figures underwhelming funds were taken into account, the overall value of Polish FDI would rise to $12 billion.

Since neither UNCTAD nor the NBP take transfer pricing funds into account, PAIiIZ announced it would start collecting its own data.

Jacek Ciesnowski

Big FDI drop in 2012 FDI inflow to Poland 2002-2012 (in € billions) Source: National Bank of Poland

20

15 * Estimate 10

5

11

20 12*

20

09

20 10

20

08 20

20 07

20 06

20 05

0

04

While not directly accused of underperforming, Poland’s foreign-investment promotion body, the Polish Information and Foreign Investment Agency (PAIiIZ), tried to paint a rosier

sent the true value of foreign investment in Poland, since NBP data does not take into account transfer pricing (funds that are channeled by foreign investors to their subsidiaries in different countries for tax reasons).

Economists say that if these

20

Devil in the details

picture. The organization released data showing that even with less money invested, more jobs were created in Poland than in the Czech Republic.

“Taking into account only FDI managed by PAIiIZ, 10,000 jobs were created in 2012, compared to 5,000 created by its Czech counterpart,” said PAIiIZ president S∏awomir Majman in an interview with news agency IAR. PAIiIZ also objects to UNCTAD’s methodology. The latest report by the UN agency disregarded FDI figures as reported by the National Bank of Poland, which put the level of foreign investment at $5.6 billion.

Indeed, according to PAIiIZ, even this figure does not repre-

20 03

their public aid is better than Poland’s,” Urszula SoliƒskaMarek, president of the Wa∏brzych SEZ, told Forbes.

Minister of Economy Janusz Piechociƒski responded to the criticism by saying that the government would look to extend the life of Poland’s SEZs. He added the priority would be to attract and keep companies interested in long-term investments, hiring Polish workers and buying Polish raw materials.

02

Poland attracted $4.1 billion in foreign direct investment in 2012, according to a report by the United Nations Conference on Trade and Development (UNCTAD). The Czech Republic, with just over a quarter of Poland’s population, outperformed Poland by a wide margin, recording $10 billion in FDI in 2012.

Even though Poland is often considered a regional leader in FDI, it’s not unprecedented for the Czech Republic to lure more (it did so previously in 2002 and 2005).

Analysts say the main rea-

son behind the Czech Republic’s high FDI figures are its foreign investment-friendly policies. In 2012 the Czech government prolonged tax exemptions for investors, and made it easier for companies to get public grants.

Poland’s relatively weak results prompted some fingerpointing, with blame assigned most frequently to Polish officials.

“We hear more and more often from investors that if Poland doesn’t extend the life of its special economic zones [which are due to expire in 2020], they’ll move to the Czech Republic or to Romania.

Czechs are very active in this field; they hold many meetings with potential investors, and

20

According to estimates, the Czech Republic attracted more FDI than Poland last year

8

INTERVIEW

www.wbj.pl

FEBRUARY 11-17, 2013

Labor policy

W∏adys∏aw Kosiniak-Kamysz, Poland’s minister of labor and social policy, sits down with WBJ to talk about the efforts to reduce unemployment, reforming Polish labor offices, extending the term of special economic zones and about the priorities in the government’s social policy

whole country. I expect good results in transforming our labor offices into modern centers where the unemployed are treated as customers and where businesses come with specific requirements, thus creating new jobs.

their cooperation with the private ones.

Private agencies will be paid for their services in two stages: first for facilitating an unemployed person’s return to the job-market and then for ensuring that the person keeps

And are there any efforts being made now to help businesses keep their present employment level, and adjust their production instead of firing people?

We are working towards making all of the employment con-

Ewa Boniecka: The unemployment rate in Poland is approaching 14 percent and the number of new jobs is the lowest in seven years. What tools do you have at your disposal to improve the situation?

W∏adys∏aw Kosiniak-Kamysz: To be precise, at the end of December the unemployment rate in Poland was not 14 percent but 13.4 percent. Yet there is no doubt that the unemployment rate is high, and that is a big concern. I have a number of policy tools at my disposal. This year z∏.4.7 billion will be spent on training the unemployed and on subsidies for entrepreneurs who create new jobs.

We are also taking the next step in the restructuring process by reforming public labor offices. In January we started a pilot program in three voivodships: Mazowieckie, Lower Silesia and Podkarpackie, which we hope will encourage private employment agencies to cooperate with public labor offices in job creation, training the unemployed for these jobs and thus helping them remain on the labor market.

The program focuses primarily on those who have been jobless for a long time, on women who want to return to work after maternity leave, and on older people looking for work. This reform is designed to modernize public labor offices and to facilitate

“Polish businesses want to create 20,000 new jobs in Poland in advanced technologies this year.” the job for at least a few months. The whole trial program will cost z∏.10 million.

This project follows the example of public-private job centers that operate successfully in Germany and the UK. Labor offices are very often seen as bureaucratic and ineffective. Why did the government wait so long with the reform of public labor offices?

The most important factor is that we are implementing these reforms after having examined the examples of job centers in other countries. For the trial program we intentionally chose regions with varied unemployment levels and different job-market particulars.

After analyzing the results of public-private cooperation in reducing unemployment and preparing people to enter the job market, we would like to implement the program in the

ditions more flexible. However, a change in labor law is necessary. I hope the amendment draft [announced on February 5, see story, p. 5] will be approved by parliament and signed by the president in a few months. The proposed amendments will allow businesses to employ workers in a more flexible way, with the number of working hours, and consequently salaries, increasing or decreasing depending on the company’s market condition. It will help employers keep their workers.

Entrepreneurs, especially in SMEs, complain that labor costs are rising, while employees claim they earn too little.

On the other hand the fact that labor costs in Poland are still lower than in other European countries is seen as an advantage. What is your view on this?

COURTESY OF THE MINISTRY OF LABOR AND SOCIAL POLICY

Fighting unemployment with reforms, training and subsidies

W∏adys∏aw Kosiniak-Kamysz is concentrating on unemployment among the young and the old The labor costs as such are not rising, but the conditions of employment are changing.

Our labor market is catching up with that of other European countries. Yet in terms of labor costs, Poland is still a very attractive market for investors.

In my opinion one of the key reasons making our market so attractive is the quality of goods and services we produce. I think that after a period of focusing predominantly on low prices, we are again starting to value the quality of products. Poland is becoming more renowned for the quality if its products.

That’s of key importance when competing with other countries.

How bad is the trade-off between various labor and social policy activities and the need to retain funds for the state budget?

I am fully aware that we are proceeding with our labor and social policy changes under difficult economic conditions, all the while dealing with budget limitations. It is crucial both to maintain and possibly increase GDP growth and promote the financial stability of the state, and to fulfill our social obligations and to reduce unemployment.

We plan to maintain the special economic zones in Poland till 2020 to provide the best conditions for Polish and foreign investors and to facili-

tate job creation in these areas. Besides, Minister of Economy and Deputy Prime Minister Janusz Piechociƒski intends to prolong the term of these zones until 2026.

The ministers of economy and treasury have agreed to work on the conditions and procedures to maintain these zones till 2026. If we succeed in keeping them, then according to an assessment by the Ministry of Economy, it will translate to approximately 250,000 new jobs. I strongly believe the term of the zones will be prolonged.

Prime Minister Donald Tusk has promised to create 400,000 new jobs, which seems

INTERVIEW

FEBRUARY 11-17, 2013

hardly possible in the present economic situation. How do you see it?

There are analyses showing that hi-tech service centers have huge potential in Poland.

We are seen as a very attractive country for hi-tech production. This is not only because of our highly qualified workers and low labor costs, but also because of our reputation for delivering quality products, which increases the competitiveness and market value of our businesses.

I have recently met with Polish business centers’ representatives, and I know they want to create 20,000 new jobs in Poland in advanced technologies. And when we take into account that the reformed labor offices will serve half a million people and assume that 250,000 of them will find work, all these factors make the projected number of newly created jobs not far from that given by the prime minister.

What are the priorities for social policy right now?

Our ministry came up with the idea to extend maternity leaves to one year, and this will be implemented by the government starting in March this year. We are focusing on helping families. There is a significant funding increase for daycare centers and at-home child care. While in 2011 funding designated for these purposes was z∏.40 million, in 2012-2013 it is half a billion z∏oty.

Care for the elderly is also very important. In 2012 we started a special program for the elderly and we slated z∏.20 million for it. This year we have z∏.40 million earmarked for this cause, including money to promote social activity and professional aspirations of the elderly, fund Universities of the Third Age, and facilitate solidarity between different generations.

I want to establish a special board in my ministry to deal with issues of the elderly. We will provide them, among other things, with the assistance of geriatric specialists, sociologists, and psychologists.

Because our population is aging, we have to develop a deeper understanding of the various needs and aspirations of senior citizens in order to recognize and take advantage of their professional and social potential more effectively.

These issues are very important to me.

Substantial EU funds will be provided to Poland this year for training and activating

people who are threatened by unemployment. How much will that help?

The program, called Human Capital, includes a number of elements and intervention in the labor market is only one of them. The program will be enforced at the local level and nearly z∏.5 billion will be provided to support educational projects and promote labor activity among various groups of Poles, especially among the disabled.

It will help finance training programs, computer courses and provide support for unemployed people who want to start their own businesses.

Emphasis will be put on designing these training programs to better cater to the participants’ needs … and to obtain tangible results when preparing people for various jobs.

Youth unemployment is a serious problem in the EU at the moment. The European Commission wants all EU citizens in their early 20s to get work and training within four months of leaving school. Is that possible under current economic conditions?

This is only a proposal brought forth by the Commission, not a binding recommendation, yet it demonstrates the EU’s anxiety with the scale of unemploy-

that, especially in times of economic crisis in the EU, the role and responsibility of ministries dealing with social and labor issues are increasing.

People all over Europe are demanding that governments protect their jobs, maintain social care and above all battle unemployment, especially that affecting young generations.

In comparison with countries such as Spain, Italy and Ireland, not to mention Greece, unemployment in Poland is much lower and social policies receive proper funding. I do everything I can to modernize the functioning of the ministry and promote a flexible and modern approach to the labor market and social policy. I hope for a positive change in the Polish economy, and there are many signals that in the second half of this year unemployment will fall.

You are a member of the Polish People’s Party (PSL), which favors a social market economy, while the Civic Platform and the government have more liberal economic views. Do those differences influence the shaping of labor and social policy?

There are no disputes about it in the government, but there are some differences in social sensitivity among some of us.

“Because our population is aging, we have to develop a deeper understanding of the various needs and aspirations of senior citizens.” ment among young people.

We are discussing this situation with other members’ labor ministers. However, even countries with a low unemployment rates, like Sweden and Finland, can only provide half the number of jobs prescribed by the EU. In Poland, we carried out a special training program last summer, dedicated to young people who dropped out of school. Still, our country, just as many other EU states, cannot guarantee training and workplaces for all young people within four months after they leave school.

And when you compare your ministry’s actions to those of corresponding ministries in other EU states, where do we stand?

In this respect, I feel we are in the middle. There is no doubt

PSL’s social sensitivity is rooted in our support for the social market economy and the social teachings of the church.

But that doesn’t mean that the government cannot successfully tackle economic and social problems. And in my opinion this variety of approaches eventually leads to arriving at the best result.

Currently, my role, with the support from the minister of finance, is to convince the whole Council of Ministers of the effectiveness of the reform of labor offices. I hope that in the course of this year, economic performance will take a turn for the better both in Poland and in the whole of Europe, and that the situation on job markets will improve, so that young Europeans will be able to look to the future with more optimism. ●

W∏adys∏aw Kosiniak-Kamysz W∏adys∏aw Kosiniak-Kamysz was born in 1981 in Kraków. He graduated from the Medical College of Jagiellonian University, and in 2010 he received his PhD in internal medicine. He became a member of the Kraków City Council in 2010.

Between 2008 and 2012 he held the office

of secretary to the Chief Executive Committee of the Polish People’s Party. Since 2012 he has been vice president of the committee. On November 10, 2011 he was nominated to the office of minister of labor and social policy. He was sworn in on November 18, 2011.

www.wbj.pl

9

10

ADVERTORIAL FEATURE

www.wbj.pl

kets. Some 70-75 percent of the company’s production is exported.

Evelthon Psimolophitis, the company’s managing director, sees positives as he looks to the future. “The crisis will balance out the market,” he says. Once the crisis has run its course, companies that survive will be those that have a quality product and a viable business model, he adds.

Cyprus firms overcoming crisis Cyprus boasts many business success stories, despite the crisis, as companies diversify and look outwards towards new markets The economic troubles that have buffeted Cyprus are well documented: the country is in the midst of negotiating a bailout, mostly to rescue its banks. In the third quarter of 2012, its GDP contracted by 2.1 percent.

It hasn’t been easy for Cyprus companies over the past couple of years, but many are using the crisis as an opportunity to restructure or find new markets. And plenty of them are outright benefiting.

For Cyprus firms, exports are key, due to the small size of the island nation’s domestic market. In 2011, exports accounted for about 12.5 percent of the country’s GDP, according to the Department of Trade within Cyprus’ Ministry of Commerce, Industry and Tourism.

And despite the economic crisis – or perhaps because of it – exports increased by a whopping 24 percent in 2011, to €1.4 billion.

Below we profile eight companies that are finding new and innovative ways to do business during the crisis. Maybe you’ll find a profitable business partner among them? ●

Investing in diversity Demetriades Group Product: Logistics solutions, hydraulic solutions, forklift rentals, water-blasting equipment, retail outlets, among others Founded: 1995 Employment: 130 Exports as share of total sales: 10% Web: www.demetriadesgroup.com The Demetriades Group comprises a diverse array of businesses but its international activity mostly comes from its Demetriades Hydraulics member company.

The firm distributes hydraulic supplies from major brands, and products include hoses, gear pumps, motors and filters. The Dememarine division of the hydraulics company is the most active in the group internationally, providing shipping solutions. The company’s engineers are able to fly anywhere in the world to provide services on cargo ships abroad.

The company never had to decrease staff as a result of the crisis. Instead, the company developed its back office, hiring additional staff to do so.

But there were other effects. “We decided to take advantage of the crisis to reorganize,” says Vasos Demetriades, the group’s managing director. “When the market opens again, we will be ready.”

Much of the company’s new solutions, including its own Combi Jet high-pressure water-blaster product and its chain of retail stores under the Ministop brand are designed to provide new avenues for cash flow.

Heating up for exports Elcora Renewable Energy Solutions Product: Solar thermal systems Founded: 1979 Employment: 18 Exports as share of total sales: 0%, but plans to start exporting soon Web: www.elcora.com.cy Elcora makes thermal energy systems – essentially solar-powered water heaters – that are now ubiquitous in Cyprus. But now that the firm has conquered the domestic market, it needs to find new outlets for growth.

“Things are down now, due to the fact that there is very little construction going on [in Cyprus],” says Marios Nicolaou, the sales manager and one of the coowners of Elcora Renewable Energy Solutions. The company still does business domestically replacing old

Cyprus Population: 838,900 (2011) Capital: Nicosia Official languages: Greek, Turkish GDP: $24.949 billion (nominal, 2011) Currency: the euro, since January 2008 Unemployment: 14% (November 2012) Main industries: tourism, food and beverage processing, cement and gypsum production, ship repair and refurbishment, textiles, light chemicals, metal products, wood, paper, stone and clay products Ease of doing business rank: 36th Sources: Eurostat, IMF, Statistical Service of the Republic of Cyprus

systems, an activity for which the government provides subsidies. But to grow, it must find new markets.

And when it comes to starting up exports, the company has ready partners in Morocco and Spain – where it is also waiting for the market to pick back up – and is looking at Portugal, as well as Middle Eastern countries such as Lebanon and Egypt. In five years, the company hopes to be exporting to at least two of these countries.

For new markets for this technology, like Poland, Mr Nicoloau has a warning: “They have to focus on quality, you can’t always look at price first. Because if people buy low-quality products, they lose trust,” and won’t want to invest in such solutions – even highquality ones – in the future. “If you [bring such products to the market] correctly, it will save the Polish people a lot of money,” he says. “In Cyprus, we are focusing on quality. The Chinese helped us with that.”

Piping in creativity Elysee Plastic Pipes and Fittings Product: Pipes and fittings Founded: 1969 Employment: 160 Exports as share of total sales: 35% Web: www.elysee.com.cy Elysee produces pipes and fittings, and exports its products to 65 countries worldwide. That doesn’t currently include the US, but the firm is looking to enter the North American market now.

“Previously we had stayed out because we felt we weren’t ready,” says Panos Protopapas, the company’s general manager, citing specificities of the North American market that aren’t necessarily present elsewhere. But the firm is now making steps in that direction.

The company’s new 10-year strategy to 2020 sees it becoming one of the top players in the plastic piping industry worldwide. “That doesn’t mean we want to be in the top 5 or even the top 20 biggest,” says Mr Protopapas. “It means we want to be considered among the best peer-to-peer.”

The firm also wants to swap its domestic-to-export sales figures, gaining 65 percent of its sales from exports by 2020. Along with North America, the company is looking to increase its presence in Latin America and former Soviet bloc countries.

Staying on the sunny side Enfoton Solar Ltd Product: Photovoltaic devices Founded: 2002 Employment: 60 Exports as share of total sales: 98-99% Web: www.enfotonsolar.com Tassos N. Roussos, marketing and sales director at Enfoton Solar Ltd, a Cypriot company that makes photovoltaics, isn’t shy about how he feels about European inaction over Chinese dumping practices. “Europe is doing nothing – it’s waiting to be slaughtered,” he warns. “If Europe wants to be part of what’s coming, they need to get off their asses.”

The entrance of Chinese companies into the market has proven a second dragon that European photovoltaics manufacturers have had to try to slay in recent years, along with the economic crisis.

FEBRUARY 11-17, 2013

Sailing with the winds of change

Still, Mr Roussos isn’t worried about the future of the industry. “The market is there,” especially as a result of European directives, he says. He touts how photovoltaics produce energy in line with consumption habits – they produce energy during the day, when most energy is being used, and none at night, when little energy is being used.

He’s confident in the capabilities of his own company as well. It exports to Germany, as well as to countries “from Spain all the way to Greece,” and everything in between, he says. The company is such a force in Cyprus’ economy that photovoltaic semiconductor devices comprised the country’s fourth-largest export category in 2011, entirely resulting from Enfoton’s sales.

Blaze of success FirePro Systems Ltd Product: Fire Extinguishing Aerosol Systems Founded: 1996 Employment: 25 Exports as share of total sales: 90% Web: www.firepro.info FirePro doesn’t produce your father’s fire extinguisher.

The devices most of us are familiar with contain pressurized gasses or liquids that spray forth from a cylindrical canister. This Limassol, Cyprus-based company produces fire extinguishing solutions that are altogether different.

For one, the basic component is a solid, composed of a blend of potassium salts. When the device is set off, it heats this compound to a few hundred degrees Celsius in a matter of two to three seconds, rendering it into an aerosol made up of nitrogen gas and potassium carbonate particles that extinguishes the fire. The units are stand-alone and easy to install, and can be installed in rooms, inside safes or cabinets, or in a rack of computer servers.

“This year our growth in turnover reached 30 percent,” smiles Dr G. Gianfilippi de Parenti, the firm’s executive director. Demand for the company’s products has rocketed despite the crisis in other sectors.

For the future, Mr de Parenti wants to continue to expand his company’s reach, now to the US, where the company has just begun selling its products, and also to Africa and the Far East.

Targeting quality G & L Calibers Ltd Product: Shotgun cartridges Founded: 1977 Employment: 16 Exports as share of total sales: 70-75% Web: www.victorycartridges.com G & L Calibers Ltd makes shotgun cartridges for hunting and clay shooting, mostly under the Victory brand.

All of the company’s production is produced in Ergates, just outside of Nicosia.

Like other Cypriot companies, the crisis has fundamentally changed the way the company does business. The company pivoted from its focus on the US market towards Asia, particularly the Middle East, but also India, where a growing middle class has brought along with it a growing popularity of clay shooting.

India, Kuwait, Dubai, UAE, and Jordan now comprise some of the company’s most important export mar-

Karnic Powerboats Ltd Product: Motorboats 18-30 feet long Founded: 1993 Employment: 22 Exports as share of total sales: 95% Web: www.karnicboats.com Karnic Powerboats makes small yachts and motorboats. Some 95 percent of the company’s turnover comes from exports, to around 40 countries in all, company officials say. And the company is willing to move into new and unheralded markets: it exports as far afield as New Zealand, and to places as isolated as Greenland.

Nicos Karaolis, the company’s managing director, says that it has reorganized every year since the crisis hit in 2009, and invested has significantly to do so. It has gone from one building on its site in Limassol, in southern Cyprus, to three. In another change from pre-crisis days, the company now produces two new models per year.

The company’s strategy of changing quickly when the times demand it has held it in good stead, and Mr Karaolis remains optimistic.

“I’m always optimistic,” he beams. “We plan what we are doing. We don’t wait to see what will happen. We have a plan B, we study, and we adapt.”

Keeping clean ZX Fami Product: Cleaning products, detergents, cosmetics Founded: 1991 Employment: 25 Exports as share of total sales: 15% Web: www.zxfami.com ZX Fami makes cleaning products, detergents and cosmetics, many of which you may have used yourself. The company supplies European giants such as Henkel and Schwartzkopf, according to company officials, while also producing under its own brand and for chains such as Lidl and Carrefour, which sell the products under their own brands.

The company is keen to emphasize its ecofriendliness and its innovativeness. It points to its waterless car wash and wax product as an example of both. It boasts of its large number of ISO certifications, some for quality control, good manufacturing practices and environmentally friendly production.

“We won the first environmental award from the Cyprus government for ecological products,” beams Christos Zachariou, the company’s managing director.

The company makes dozens of products, and supplies both the domestic market as well as Middle East and European markets (their share in export sales is 50/50, says Mr Zachariou) – all with just 25 people. That’s a credit to the company’s innovativeness and its investment in R&D, according to company officials. ● Want to learn more about potential partners from Cyprus for your business? Contact the Cyprus Trade Center in Warsaw.

Cyprus Trade Center Warsaw ul. Pilicka 4 02-629 Warsaw, Poland Tel: 22 854 01 77 Fax: 22 854 01 80 e-mail: ctc@cyprustrade.pl www.cyprustrade.pl

OPINION & ANALYSIS

FEBRUARY 11-17, 2013

www.wbj.pl

Europe’s hidden stimulus

T

he European Council should look at private investment as a means to kick-start Europe’s stagnant economy. With the usual drivers of GDP growth constrained across Europe, the one economic sector able to spend is the non-financial corporate sector.

Indeed, publicly traded European companies had excess cash holdings of €750 billion ($1 trillion) in 2011, close to a 20-year high. Unlocking that cash would give Europe a much larger stimulus package than any government can provide. In 2011, for example, private investment in Europe totaled more than €2 trillion, compared to government investment of less than €300 billion.

And yet, while trends among European economies have varied, private investment was, overall, the hardest-hit component of GDP during the crisis, plunging by more than €350 billion – 10 times greater than the fall in private consumption and four times more than the decline in real GDP – between 2007 and 2011.

The magnitude of the private-investment downturn was, in fact, unprecedented – and lies at the heart of Europe’s economic malaise.

Running late Likewise, by historical standards, the

in its retail sector during the 1990s, the country posted the strongest retail productivity growth in Europe (and outstripped that of the United States) between 1995 and 2005. Standardization and liberalization in European telecoms underpinned 9 percent growth in value added and productivity in this period, compared to 6 percent growth in the US.

private-investment recovery is running late. In more than 40 past episodes in which GDP fell and private investment declined by 10 percent, recovery took an average of five years. Europe is four years removed from the onset of recession, but private investment in 2011 was still lower than its 2007 level in 26 of the European Union’s 27 member states.

To be sure, the fact that companies are holding onto their cash, rather than paying it out in dividends, signals that they expect investment opportunities to return – a far more positive situation than in Japan, for example, where companies lack cash to invest. But European companies remain hesitant, despite low interest rates, keeping private investment well below its previous peak.

Governments can help to persuade companies to let go of their cash by removing regulatory barriers such as zoning regulations in retail and a plethora of requirements in the construction sector concerning everything from the height of ceilings to the size of staircase areas. They should also address the lack of uniform standards across Europe’s internal borders. For example, there are 11 separate signaling systems for rail freight in the EU-15.

After Sweden eased planning laws

Targeted reforms The largest scope for renewed private investment is in capital-intensive sectors in which government has a major presence as regulator. Even if European countries were to close only 10 percent of the variation in capital stock per worker at the sub-sector level, the impact could be more than €360 billion in additional investment – offsetting the €354 billion difference in private investment between 2007 and 2011.

Many projects, from airports to university campuses, benefit from returns over decades, which implies that weak demand in the short term will have only a limited impact on their overall viability. Even among more near-term projects, some – for example, retrofitting buildings with more energy-efficient features – could become viable with action from policymakers. Some degree of

investment will add to demand, which may persuade others to invest – a virtuous circle.

Focus on construction First, governments need to focus on sectors in which action is likely to trigger renewed investment on a scale large enough to boost GDP – and quickly enough to enable private investment to drive the recovery.

Governments often become enamored of innovative sectors, such as semiconductors, that account for only a very small share of total investment.

Policymakers may wish to develop these sectors as a catalyst to innovation, but they should not expect that such initiatives alone can spur a recovery in private investment.

In fact, construction and real estate are the most promising candidates, as they account for roughly one-third of European fixed investment and more than 17 million jobs.

Although these sectors are unlikely to rebound to pre-crisis levels in Greece, Ireland, and Spain for many years, other European economies, including the United Kingdom, Italy, and Sweden, as well as some Eastern European economies, have scope for further investment.

To meet Europe’s ambitious 2020 energy targets, retrofitting existing

11

Eric Labaye buildings and improving new buildings’ energy efficiency, including the use of more energy-efficient materials and equipment, could lead to roughly €37 billion in additional annual investment between now and 2030. In most European countries, action to spur private investment in local services and transport – both large sectors – should also be considered.

Governments, however, need to understand the barriers to investment: regulatory failures; weak enablers, including financial and human capital; poor infrastructure; and substandard technology. And they must undertake rigorous costbenefit analyses, in order to ensure that any intervention translates into private investment that promotes productivity growth.

Three ingredients are vital to getting it right: backing for initiatives at the highest political level; participation by all key stakeholders in deciding what action to take and driving its implementation; and establishing small, high-powered delivery units with clear mandates to coordinate interventions. ● Eric Labaye is chairman of the McKinsey Global Institute.

Copyright: Project Syndicate, 2013.

Project-syndicate.org

The flight of the European bumblebee Indermit Gill and Lúcio Vinhas de Souza

In

July 2012, while addressing bankers in London, European Central Bank president Mario Draghi likened the euro to the bumblebee. “This is a mystery of nature, because it shouldn’t fly but instead it does. So the euro was a bumblebee that flew very well for several years.” But “something must have changed.” So the “bumblebee would have to graduate to a real bee.

And that’s what it’s doing.”

Actually, for scientists, there has never been any mystery about how bumblebees can fly: they beat their wings about 200 times per second.

They cannot possibly do this by flexing their muscles, but only by vibrating them.

So, is the euro zone ready to vibrate, rather than flex? Three steady shifts have occurred in Europe over the last three years. Flexible fiscal rules and rigid monetary policies have given way to the opposite. The same has happened in the case of tight labor laws and looser financial regulations, while European surveillance and global emergency mecha-

nisms have undergone a similar change.

Sensible shifts These shifts are sensible, and they should be sustained. The first shift is overdue, and the reasons are not subtle. One of the euro’s main problems since its introduction in 1999 has been that almost every national treasury flouted the monetary union’s fiscal rules. By contrast, the ECB was a model of rectitude, and its discipline helped everyone. Inflation dropped sharply, especially in the poorest countries. In 1995, inflation rates in Portugal and Greece were about three times those of northern Europe’s economies; by 2008, they were the same.

Freed from the worry of destabilizing exchange-rate adjustments that had plagued postwar Europe, trade increased dramatically, especially in the bigger economies. In 1990, Germany’s exports accounted for 25 percent of GDP; by 2008, they had almost doubled to 48 percent. Monetary stability reduced the cost of cred-

it. Interest rates were almost 20 percent in Greece and Portugal in the 1990s; by 2008, they were 2.5 percent, implying parity between Greek and German rates.

Anything that leads to lower inflation, more trade, and interest rates that are lower than growth rates is a good thing. So both the single market and the common currency have been good for Europe. But, by treating all sovereign debt equally, the ECB sent markets the wrong signal. As exchange rates in the euro zone were fixed and uniform, interest rates on government debt should have signaled differences in economic strength.

The way it should be Institutions have evolved. The ECB is now capable of lender-of-last resort operations, like its counterparts in the US and UK. The European Union’s fiscal framework, though still far from unified, has progressed toward greater coordination. Today, Greece’s government cannot borrow at all, and Ireland must pay high

interest rates, while France’s treasury might soon have to pay more, and Germany may be able to borrow even more cheaply. Market signals are working again, and that is the way it should be.

Current-account deficits in the euro zone “periphery” have been halved, the competitiveness loss accumulated during the last decade has been reduced, and important structural reforms – making labor markets more flexible and opening up industries sheltered from competition – have been implemented.

But a lot of adjustment remains to be completed. Europe needs better regulation of financial movements, which flow in the right direction, but are erratic, flooding Europe’s less advanced economies when finance is plentiful, and starving them of credit in times of stress. Financial flows could be stabilized through a combination of conservative national fiscal policies and region-wide regulation, so that they do not suddenly stop when growth slows. Here, too, small vibrations, not the flexing of powerful

political muscles, are needed.

Global governance A third shift is in the geography of surveillance. At the start of the crisis, EU policymakers tended to view global financial institutions as sources of emergency funds, not as monitors of EU economies. Over the last three years, Europe has increasingly relied on global, as opposed to regional, governance. Surely, European leaders would rather keep both governance mechanisms and stability funds regional. But it may be more practical to have global financial and surveillance systems generate the vibrations that will make Europe dynamic, while drawing on EU sources of funds during emergencies. ● Indermit Gill is chief economist for Europe and Central Asia at the World Bank. Lúcio Vinhas de Souza is managing director and sovereign chief economist at Moody’s Investors Service. The views expressed here are their own.

Copyright: Project Syndicate, 2013.

Project-syndicate.org

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

PUBLISHER VALKEA MEDIA SA MANAGING EDITORS

REAL ESTATE EDITOR

JACEK CIESNOWSKI (JCIESNOWSKI@WBJ.PL) BEATA SOCHA (BSOCHA@WBJ.PL)

KAROLINA KOWALSKA (KKOWALSKA@WBJ.PL)

ADAM NARCZEWSKI ANDREW NAWROCKI

REPORTER

INTERN

POLITICS EDITOR

E. BLAKE BERRY EWA BONIECKA DAVID INGHAM DANIEL SCHMUCK ALEX ZARGANIS

REMI ADEKOYA (RADEKOYA@WBJ.PL)

KAMILA WAJSZCZUK CONTRIBUTORS

COLUMNISTS

EDITOR-IN-CHIEF ANDREW KURETH (AKURETH@WBJ.PL) MARKETING &SALES

AGNIESZKA BREJWO

MARTA MARDOSZ

MARKETING &SALES DIRECTOR

PRODUCTION MANAGER

MAGDALENA KARPI¡SKA (MKARPINSKA@WBJ.PL)

PIOTR WYSKOK

GRAPHIC DESIGNER

¸UKASZ MAZUREK

(ABREJWO@WBJ.PL)

AGNIESZKA KUCZY¡SKA (AKUCZYNSKA@WBJ.PL)

MANAGING DIRECTOR MONIKA STAWICKA

EWA BROGOSZ-KORYCKA (EBROGOSZ-KORYCKA@WBJ.PL)

PRINT & DISTRIBUTION COORDINATOR

KRZYSZTOF WILI¡SKI (DYSTRYBUCJA@VALKEA.COM)

PR & MARKETING SPECIALIST

KATARZYNA MAREK (KMAREK@WBJ.PL)

BOOK OF LISTS SPECIALIST

MONIKA BRYSIAK (MBRYSIAK@VALKEA.COM)

SUBSCRIPTIONS MANAGER

AGNIESZKA MICHALIK (AMICHALIK@VALKEA.COM)

Prenumerata realizowana przez RUCH S.A: Zamówienia na prenumerat´ w wersji papierowej i na e-wydania mo˝na sk∏adaç bezpoÊrednio na stronie www.prenumerata.ruch.com.pl Ewentualne pytania prosimy kierowaç na adres e-mail: prenumerata@ruch.com.pl lub kontaktujàc si´ z Telefonicznym Biurem Obs∏ugi Klienta pod numerem: 801 800 803 lub 22 717 59 59 – czynne w godzinach 700 – 1800. Koszt po∏àczenia wg taryfy operatora.

AIM Poland Office phone: +48 500 075 046 email: barbara.owerczuk@aimcongress.com

COVER STORY

www.wbj.pl

Economic policy

Can the government’s investment vehicle help the economy?

Remi Adekoya

Macroeconomic data in recent months have left no doubt that the Polish economy is experiencing a sharp downturn.

Unemployment is fast approaching 14 percent, domestic demand, which accounts for 62 percent of Poland’s GDP, is down and exports have been affected by the slowdown in the euro zone. Poland’s PMI readings have shown deterioration in the industrial sector for nearly a year now.

It was in this context that Prime Minister Donald Tusk announced last October the creation of Polish Investments, a special-purpose vehicle meant to exploit state assets to finance investments and give the economy a boost.

“This will be possible without affecting the safety of the state’s finances, meaning without increasing the budget deficit or public debt. It will be possible thanks to the active use of capital, which today is frozen,” said Mr Tusk in his speech to parliament.

About to take off Polish Investments is scheduled to take off in Q2 of this year. The SPV will create companies responsible for preparing and carrying out large projects, especially in the infrastructure sector. It could even be listed on the Warsaw Stock Exchange in the future.

After having played the role of a private equity fund, the SPV will withdraw from the newly formed company, letting private entrepreneurs to take over control.

By 2015, the government aims to pour z∏.40 billion into the SPV, with the funds com-

ing from the liquidation of state assets, mostly in companies where the State Treasury still has a stake. For example, the Treasury recently sold a stake in PKO BP, raising z∏.4.4 billion for the first phase of the program.

Treasury Minister Miko∏aj Budzanowski said the priority now is to get the project going organizationally and work on a list of potential investments. “Projects are to wait for the money coming from the sale of shares in state-owned companies, not the other way around,” Mr Budzanowski told reporters last month.

What do experts think?

Polish Investments wants to focus on infrastructure projects

“SPVs are not a new idea, they were used in the 1930s and 1940s. Their economic value is rather positive if they adhere to the rules of transparency, but there will be a battle between interest groups for this money and that battle will wade into politics,” said Jan Filip Stani∏ko, an analyst at the Sobieski Institute.

Meanwhile, Stanis∏aw Gomu∏ka, chief economist from the Business Center Club, said the SPV is an alternative way for the government to continue public investments.

Mr Gomu∏ka, who served as deputy finance minister in the current coalition, said the

“There will be a battle between interest groups for this money and that battle will wade into politics.”

Mr Stani∏ko said the government needs to set out its priorities for the Polish Investments program.

“Right now, we have a vehicle but we do not know in which direction it is going. The government needs to decide where it wants to channel the capital,” he added.

Mr Stani∏ko thinks it would be sensible to co-finance the building of Poland’s planned nuclear facilities or to take over financially troubled banks, but that shale gas investments, for example, should be left to foreign capital, which has the necessary know-how in that area.

KGHM to spend up to $4 bln on Sierra Gorda mine in Chile

Herbert Wirth, the CEO of Poland’s copper and silver giant KGHM, expects capital expenditures for the Sierra Gorda mine to be no more than $4 billion, if the situation does not change within the 13 months left until the project’s planned completion. Originally, KGHM planned to spend $3 billion but had to increase its cost projections as a result of conditions in the Chilean market.

SHUTTERSTOCK

A state-controlled SPV plans to spend billions on selected projects, but opinions are mixed as to how effective it will really be

13

COURTESY OF KGHM

FEBRUARY 11-17, 2013

Polish government, in its public finance convergence report, informed Brussels that public investments in Poland would decline from 5.8 percent of GDP in 2011 to 3.8 percent in 2015.

That would mean the government spending roughly z∏.53 billion on public investments in 2015, compared to the z∏.88 billion it spent in 2011, Mr Gomu∏ka said. The government is now trying to bridge that gap, he added.

Mr Gomu∏ka also thinks the Polish Investments SPV will be of little help to Poland’s troubled SME sector. “The projects are for big companies,

because the SPV will be involved in projects worth z∏.250 to z∏.600 million,” he said.

Moreover, he called the amount that Polish Investments is supposed to invest over the next three to four years – z∏.40 billion – “insignificant.”

“That is not enough to fill the gap resulting from the drop in public investment. The prime minister was just trying to make a political statement that his government is doing something to keep investments going,” Mr Gomu∏ka said.

But Przemys∏aw Kwiecieƒ, chief economist at X-Trade Brokers, took a different stance, saying “in such times of economic slowdown any potential help is welcome. We are in a tough period now because Poland is in between EU budgets and does not yet know how much exactly it will receive in 2014-2020,” he said.

Mr Kwiecieƒ and Mr Gomu∏ka agreed though that the SPV’s success will depend greatly on whether economic logic or political sentiments would be used when selecting projects to be funded.

Loan guarantees from BGK There will be another aspect of the government’s investment program, organized through the only fully state-controlled bank in Poland, Bank Gospodarstwa Krajowego (BGK).

The Treasury aims to recapitalize BGK with z∏.40 billion by 2015. The money is to be used to extend guarantees to SMEs that have problems raising financing in the private sector.

The plan is to make BGK capable of guaranteeing up to 60 percent of such a loan. Mr Gomu∏ka believes these guarantees will be more “useful” to businesses as they could really help out some cash-starved SMEs. Mr Kwiecieƒ is rather optimistic about the SPV’s future, mainly due to BGK’s involvement in the process. “It is better that a bank will be making decisions and not some government agency. Maybe this will ensure the decisions made will be based on economic principles,” said Mr Kwiecieƒ.

With Polish Investments due to begin activity in a few months, it will soon be clear just how sound the decisions are. ●

PGNiG unit’s IPO scheduled for mid-2013 Exalo Drilling, the gas exploration unit of Poland’s largest natural gas company PGNiG, should be ready for its IPO by the end of the first half of 2013, PGNiG’s CEO Gra˝yna Piotrowska-Oliwa said.

The company needs about z∏.1-1.2 billion for development.

Privatization revenue at z∏.9.16 bln in 2012 Poland raised z∏.9.16 billion in privatization revenue in 2012, including z∏.7.19 billion through the stock exchange. Eight companies’ shares were sold on the stock market, including a 7.6% stake in bank PKO BP that sold for z∏.3.1 billion and a 7% stake in utility PGE that sold for over z∏.2.5 billion. The plan for 2013 is to raise z∏.5 billion. ●

Maybe social

media

is just a fad.

But these companies don’t think so. *

Combining the most in-depth social media knowledge with the sophisticated insights of consumer behavior

www.valkea-attention.com *Attention USA clients

More of our interview with Krzysztof Duszczyk

Gemini Park Bielsko-Bia∏a will expand by 20,000 sqm and opena 1,000-sqm youth center

18

17

LOKALE IMMOBILIA

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

Spanish fund Aiga Investments is planning to sell its Murawa Office Park in Poznaƒ. The five interconnected threestorey class-A buildings are situated on ul.

Murawa and offer a total of 7,500 sqm and a parking lot with room for 94 vehicles. The scheme was awarded in the “Best Office Development for Poland” category at the European Property Awards in 2011.

Colliers International to lease Times II in Wroc∏aw Developer UBM has selected Colliers International to handle the leasing of the office and retail space in its Times II project to commence at the turn of Q2 and Q3 of 2013. The project will offer about 18,000 sqm of modern office space, 1,580 sqm of retail space and around 400 parking spaces.

Leroy Merlin to open in P∏ock Store operator Leroy Merlin is planning to open a new store in P∏ock. With 10,000 sqm of space it will be one of the company’s biggest retail facilities in Poland.

The investment will take up almost 5 ha of land. It will comprise a parking lot for 550 cars. ●

In this issue Budma fair . . . . . . . . . . . . . . . . . .15 Duszczyk interview . . . . . . .15,18 Bielsko-Biała mall . . . . . . . . . . . .17 Poznań City Center . . . . . . . . . .17

Construction

Intelligent buildings stars of Budma fair in Poznaƒ Glass houses and intelligent building technologies drew attention of the visitors of 2013 Budma fair in Poznaƒ Passive and intelligent building technology companies’ stands attracted the greatest amount of attention among the 10,000 visitors at the recent Budma International Construction Fair and the accompanying WinDoor-tech, CBS and Glass trade fair.

The four-day exhibition featured more than 1,200 companies involved in the construction industry, a large number of whom offered passive and intelligent building technologies. According to exhibitors, the number of developers interested in using the latest advances in information technology to increase building efficiency and to cut expenditures continues to grow each year. Now, with a soon-to-be implemented government program that will subsidize passive and energyefficient buildings, they are

looking for a chance to save money and lure buyers with savings.

The program, which should be implemented later this year, offers up to z∏.50,000 for those planning to build such homes on their land, and as much as z∏.16,000 for buyers of apartments in such buildings.

Developers are hoping to take a significant bite of the program’s subsidy cake, which stands at some z∏.300 million.

Visitors were particularly interested in a demo “autonomous building” that was erected in one of the fair halls. Autonomous buildings are designed to be operated independently from infrastructural support services such as the electric power grid, gas grid, municipal water systems, sewage treatment systems, storm drains, communication services, and in some cases, public roads.

They are perceived by developers as the technology of the future.

As the event was accompanied by the Glass trade fair, there was also an exhibition of a building made almost entire-

COURTESY OF BUILDGREEN

Murawa Office park to change hands

FEBRUARY 11-17, 2013, LI 18/05

Passive houses are increasingly popular ly out of glass. Glass can be used as a heating material and was touted as easy-to-clean, sturdy and visually attractive.

Glass can’t compete in terms of price with wood or brick, but is becoming increasingly popular in Western countries.

As the theme of this year’s

fair was “Construction of the Future. Intelligent Architecture” the program of events focused on the presentation of intelligent design systems, efficient and low-energy technologies, innovative materials and building systems, as well as integrated control and mod-

ern building management.

“You can argue about buildings having a soul, but their intelligence is becoming more and more difficult to question,” said Dariusz MuÊlewski, the director of the Budma fair.

Karolina Kowalska

Construction & engineering

Intelligent solutions: keeping you warm and drawing your bath Lokale Immobilia sits down with Krzysztof Duszczyk, a professor of engineering at the Warsaw University of Technology, to talk about intelligent building systems and the future of construction engineering Karolina Kowalska: How intelligent can a building get?

Krzysztof Duszczyk: The human mind is the limit.

According to one theory, an intelligent building is as smart as its occupants. Another one

states that it’s even smarter, because it can significatntly compensate for the occupant’s irrational behavior. In general, an intelligent building uses the latest advances in information technology to increase its effi-

ciency and occupants’ comfort and safety while reducing energy consumption, therefore cutting energy bills.

So intelligent buildings are also environmentally friendly?

The evolution in intelligent construction leads towards energy-efficiency, as it is one of its main priorities. The most advanced intelligent buildings don’t take any energy from the

electrical grid. In fact, they generate it from alternative sources such as the sun, wind and water from geothermal pumps; they can even recover heat from waste. The surplus can be sold to power neighboring buildings, so the owner could actually earn money. Such technologies are already in use in big commercial buildings in the US and China. These are usually huge schemes such as hotels, apart-

ment buildings and conference centers.

Why are there so few energygenerating buildings in Europe?

Such constructions require continuous exposure to the sun and other alternative energy sources. It’s no wonder they are popular in wealthy and hot Arab countries.

Continued on p. 18 ➡

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

Custom publishing delivers specially tailored content Professionally honed and targeted to a defined group, whether B2B or end-customers, each message is designed for maximum effectiveness.

Custom publishing is one of the world’s fastest-growing marketing tools, because it pinpoints – and achieves – corporate goals.

Popular custom publishing media: • print: magazines, enhanced catalogs, newspapers • virtual: web services, newsletters, e-zines • interactive: social media If you want to: • build loyalty and long-term customer relations • acquire new clients • implement an integrated professional communication strategy • build strong brand identity Custom publishing is the perfect tool!

Valkea Media SA, ul. Elbląska 15/17, 01-747 Warszawa, tel. 22 639 85 69, e-mail: mlindholm@valkea.com, www.cp.valkea.com, www.facebook.com/valkeacp

FEBRUARY 11-17, 2013

LOKALE IMMOBILIA – REAL ESTATE

Retail

COURTESY OF GEMINI HOLDINGS

Shopping mall to host youth center

Gemini Park Bielsko-Bia∏a’s expansion will double its area

Gemini Park BielskoBia∏a will expand by another 20,000 sqm and open a 1,000-sqm center for children The Siemacha Recreation and Intervention Center for Children will be open from November this year, after the expansion project of Gemini Park Bielsko-Bia∏a has been completed.

After the expansion, the mall will add 70 new retail stores to the existing 80, as well as a number of new restaurants and entertainment facilities.

The building will also host a spa, a medical clinic, as well as fashion and multimedia stores.

The shopping center in Silesia is expected to grow from the current 27,500 sqm to 55,000-59,000 sqm. The new facilities will cater not only to shoppers’ needs but also to those of underprivileged children from Bielsko-

Bia∏a.

“Opening the Siemacha center within the mall is our duty to the citizens of BielskoBia∏a. This is how we try to put our social responsibility values into practice,” Rafa∏ Sonik, president of Gemini Holdings, told Lokale Immobilia.

“We want to aid underprivileged children by providing them with professional psychological help, as well as facilitating their education and physical development. We strongly believe we can make a positive and lasting impact on their lives,” Mr Sonik added. “This project will give them opportunities to spend their time in a productive manner rather than just hang out in the shopping mall.”

The Siemacha youth center will occupy between 500 and 1,000 sqm of space on the third floor of Gemini Park Bielsko-Bia∏a. It will offer music classes led by professional music teachers, foreign

language lessons, art and computer classes. All of these will be free of charge as part of an equal-opportunity program for underprivileged children.

“We expect to look after at least 500 children here,” said Mr Sonik.

Gemini Park Bielsko-Bia∏a will be the fourth shopping center to host a Siemacha youth center, the other three being Gemini Park Tarnów, Mielnium Hall in Rzeszów and Galeria Bonarka in Kraków.

Gemini Holdings is planning to open another Siemacha center in Kielce and is in talks with shopping mall owners in Radom and Warsaw as well.

Gemini Holdings has been active in the Polish market since 1993 and was previously involved in the development of projects for retail chains including Géant, Carrefour, Tesco and Lidl throughout Poland.

Karolina Kowalska

Retail

Topping of Poznaƒ City Center next month Completion of the shopping center is scheduled for this summer TriGranit’s Poznaƒ City Center investment, located near the city’s main railway station, is scheduled to be topped-out in early March.

The developer recently completed the center’s open shell stage. To date, the investment has been 65 percent leased out, while another 13 percent is the subject of advanced negotiations.

The entire investment should be roofed this spring and its completion is sched-

uled for the summer. According to TriGranit officials, retailers will appear in the Poznaƒ City Centre before the summer holidays to fit out and decorate their stores.

Future tenants of Poznaƒ City Center include Toys ‘R’ Us, Piotr i Pawe∏, H&M, Saturn, Alshaya Group, KappAhl, Douglas, TK Maxx, CCC, Deichmann, Rossmann, Terranova, Cubus and Superpharm.

Poznaƒ City Center is a mixed-use development, whose total value will amount to some €250 million. Apart from the shopping center, it will include a railway station and a bus station.

The scheme is being realized in partnership with Polish State Railways, which provided four hectares of land.

TriGranit is responsible for all development activity related to the construction of the scheme. The 60,000-sqm investment will have 250 retail units and two food courts.

Poznaƒ City Center will be leased out by TriGranit’s newly appointed leasing director for Poland, Natalia Pradelska. Ms Pradelska will also be responsible for the re-leasing of Bonarka City Center in Kraków.

Karolina Kowalska

www.wbj.pl

17

18

LOKALE IMMOBILIA – REAL ESTATE

www.wbj.pl

FEBRUARY 11-17, 2013

Construction & engineering

Intelligent solutions: keeping you warm and drawing your bath In the United Arab Emirates there are buildings whose walls follow the sun, revolving in accordance with its daily cycle, to keep the living room filled with sunshine or the bedroom in the shade. Of course, this type of building is not selfsustaining and can’t feed only on the energy it generates.

Standard features of intelligent buildings include lights that turn themselves off, regulated heating and security monitoring. They can open or close blinds depending on the time of the day. … and walk the dog?

Not exactly, but they can let the dog out into the garden and let it back in, making sure it only allows in the right one, leaving its playing buddy out.

Advanced technologies can also monitor an occupant’s body temperature and blood pressure, which is important for the elderly and the sick. It can be programmed to measure vital signs, and let the closest emergency room know when the readings are abnormal or that the occupant has

just had a stroke or a heart attack.

But the most common solutions focus simply on the occupant’s comfort, safety and savings while eliminating unnecessary expenditures. When you open the window, the system won’t turn up the heating to regulate the temperature.

Instead it will urge you to close

er. This technology allows us to program historic buildings, such as churches or palaces, which can’t be altered. A concept of intelligent buidling was created in the US in the late 1980s, when developers tired of refurbishing offices every five years only to keep them up-to-date with the latest technological developments. They wanted to invent a device that could change a building’s functionality without time-consuming and expensive construction work. They realized it could be done with technology.

system will make sure the water is warm enough. While at home, you can command the building through a wall panel that could control the lighting, temperature or send and receive texts and e-mails.

Can you tell your house to turn on your kettle, for example?

“Intelligent houses leave the occupant in control ... unless he makes obvious errors.

Then the system takes over.”

COURTESY OF KRZYSZTOF DUSZCZYK

➡ Continued from p. 15

Professor Krzysztof Duszczyk the window. It will also turn off the faucet if you forget to do so after washing your hands. Generally it leaves the occupant in control, either through a wall panel or a cell phone, unless he makes obvious errors. Then the system takes over.

So you can use your cell phone to control the building?

If you install the right application. In intelligent buildings you can fill the bathtub by sending a text message and the

It is enough to send a text message to the control panel. If I was to build a house, I would definitely install the system that allows me to make commands and sends me feedback in a text message. I could program the heating system according to my family’s schedule. Knowing all of us don’t come back untill 4 pm, I would turn the heating down by a few degrees and make the building reheat itself an hour before my arrival. It was

proven that turning down the heat by just one degree can save a significant amount of money.

I would probably also install safety systems. Not biometric ones, which are far too advanced for a family house, but rather those based on infrared motion sensors. I would like to know about an intruder as soon as he trespasses on my property, before he breaks a window and enters

the house. The monitoring system would send live feed directly to my phone.

Can an existing building be made intelligent?

Of course – and it can be done without refurbishing the building, peeling off wallpaper and pulling down walls, because radio waves can be used as a means of communication. It is enough to install a compactsized transmitter and a receiv-

Are intelligent buildings popular in Poland?

They are becoming more and more so. In fact, our Intelligent Building program students find work even before they graduate. Some of them set up their own companies and develop their own systems. We teach students to program in a variety of systems so that they can adjust them to client’s wishes. Current trends in the construction industry indicate that the demand for intelligent buildings will continue to increase. ●

THE LIST

FEBRUARY 11-17, 2013

www.wbj.pl

19

Miscellaneous

Private Health Care Centers in Warsaw Ranked by total revenue in 2011 A guide to Polish business and industry

www.bookoflists.pl

Przewodnik po polskim biznesie i gospodarce

Gastrology / Gynecology / Internal diseases / Cardiology

Laryngology / Labor medicine / Nephrology / Neurology

Orthopedics / Pediatrics / Psychiatry / Psychology

Pulmonology / Rheumatology / Urology / Ophthalmology

Dentistry / Maternity ward / Emergency services

NFZ services / Laboratory tests / Home visits

LUX MED Sp. z o.o. ul. Post´pu 21C, 02-676 Warsaw 1 22 450-4500/22 450-4500 zarzad.sekretariat@luxmed.pl www.luxmed.pl

652.0 616.6 559.3

WND 417.0 WND

WND WND WND

3,941 WND

31 WND

WND WND

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

34 1,000,000 1992

Grupa Medicover w Polsce Al. Jerozolimskie 96, 2 00-807 Warsaw 500-900-500/22 592-7001 www.medicover.pl

577.0 469.0 435.0

WND WND WND

6,500 6,000 5,500

1,500 WND

WND WND

WND WND

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

32 WND 1994

Rank

Number of Nurses / Orderlies

Allergology / Surgery / Dermatology / Endocrinology

Outlets in Warsaw / Number of Family clients packages / with paid Hospital / / Ambulance package Year founded in Poland

Number of Beds / Technicians

Rehabilitation / Corporate packages / Medical diagnostics / Physician on duty

Specialization

Company name Address Tel./Fax E-mail Website

Total revenue (z∏. mln)

Revenue of from health Number of Number doctors: care Total / package companies served min. sales 5h/week (z∏. mln)

Ownership: Polish / Foreign

Top local executive / Title

2011 / 2010 / 2009

None Anna Mid Europa Partners Rulkiewicz - 100%(1) President

None Medicover Holding

Pawe∏ Kacprzyk President

Adam Rozwadowski 30.2%; Anna Maria Rozwadowska 30.2%; Jacek Jakub Adam Rozwadowski - Rozwadowski 4.2%; Bartosz President Adam Rozwadowski 4.1% None

Centrum Medyczne ENEL-MED SA ul. S∏omiƒskiego 19/524, 3 00-195 Warsaw 22 431-7700/22 431-7703 enel@enel.pl www.enel.pl

166.3 137.8 120.9

WND WND WND

1,181 WND WND

1,009 WND

50 257

223 -

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

11 122,000 1993

DANTEX Sp. z o.o. Sp.k.-a.

- Centrum Medyczne DANTEX MED ul. P∏ocka 9/11, 4 01-231 Warsaw 22 887-3390/22 887-3391 med@dantexmed.pl www.dantexmed.pl

28.1 115.2 36.1

2.0 2.6 2.5

WND WND 188

94 66

7

17 -

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ -

✓ ✓ ✓ ✓

✓ ✓ -

✓ ✓ -

✓ ✓ ✓ -

✓ -

4 WND 2000

Mark Roefler; Piotr WiÊlicki None

Centrum Nasze Zdrowie Sp. z o.o. ul. GórnoÊlàska 4A, 5 00-444 Warsaw 22 378-1220/22 378-1223 cm@nasze-zdrowie.pl www.nasze-zdrowie.pl

4.2 4.0 4.0

2.0 2.0 2.0

213 203 191

62 23

8

5 -

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ -

✓ ✓ -

✓ ✓ ✓ -

✓ -

2 3,400 1993

Olamed - 90% None

Europejskie Centrum Zdrowia Otwock Sp. z o.o. ul. Borowa 14/18, NR 05-400 Otwock 22 710-3001/22 710-3160 biuro@ecz-otwock.pl www.ecz-otwock.pl

WND WND WND

WND WND WND

WND WND WND

120 WND

96 10

130 WND

✓ ✓

✓ ✓ ✓ ✓

✓ ✓ -

✓ ✓

✓ ✓ -

-

✓ ✓ -

✓ ✓ ✓ ✓

✓ ✓ ✓

3 WND 2004

WND

Klinika Medyczna IBIS Sp. z o.o. i Wspólnicy Sp.k. ul. Kacza 8, 01-013 Warsaw NR 22 710-3333/22 322-8180 szpital@szpitalibis.pl www.szpitalibis.com.pl

WND WND WND

WND WND WND

WND WND WND

77 58

18 5

32 2

✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ -

✓ ✓

✓ ✓ ✓ ✓

✓ -

✓ ✓ ✓

✓ ✓ -

✓ ✓ -

3 WND 2001

WND

WND

Sensor Cliniq Sp. z o.o. i Wspólnicy Sp.k. ul. Kacza 8, 01-013 Warsaw NR 22 710-3333/22 322-8181 szpital@sensorcliniq.pl www.sensorcliniq.pl

WND WND WND

WND WND WND

WND WND WND

75 WND

15 WND

35 WND

-

✓

✓ -

-

✓

-

✓ ✓ -

✓ -

✓ -

2 WND 2001

WND

WND

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

Footnotes: (1) In December 2012 acquisition agreement has been signed by Bupa - transaction is expected to be completed in the first quarter of 2013.

Wojciech Kossut Managing Director

Katarzyna Hosaja Managing Director

Anna Kieszkowska -Grudny 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) 22 639-8569, or via e-mail to wbjbol@wbj.pl. Copyright 2012, 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

FEBRUARY 11-17, 2013

Stocks report

world stock indices DJIA

NASDAQ

13,944.05 (Feb 7 close)

S&P500

3,168.48 (Feb 7 close)

0.60% (for the week)

FTSE100

1,509.39 (Feb 7 close)

0.84% (for the week)

DAX

6,228.40 (Feb 7 close)

0.75% (for the week)

-0.77% (for the week)

Stocks seesaw

NIKKEI225 7,590.85 (Feb 7 close)

11,357.07 (Feb 7 close)

-2.38% (for the week)

1.96% (for the week)

CHANGE: 3.96%

CHANGE: -0.89%

CHANGE: 3.21%

CHANGE: 3.33%

CHANGE: -2.42%

CHANGE: 6.26%

(year to February 7)

(year to February 7)

(year to February 7)

(year to February 7)

(year to February 7)

(year to February 7)

52-week high: 14,019.80

52-week high: 3,196.93

52-week high: 1,514.96

52-week high: 6,354.50

52-week high: 7,871.79

52-week high: 11,498.40

52-week low: 12,035.10

52-week low: 2,726.68

52-week low: 1,266.74

52-week low: 5,229.80

52-week low: 5,914.43

52-week low: 8,238.96

Andrew Nawrocki WBJ market analyst Political uncertainty within Europe returned last week, spooking stock markets throughout the Continent.

First, uncertainty in both Spain and Italy revived worries that the steps taken to rein in the euro zone debt crisis could unravel. Polish stocks managed to fair the bad weather well, with the WSE’s main index, the WIG, losing 0.83 percent compared to hefty losses in Frankfurt (-2.49 percent) and Paris (-3.01 percent).

The blue-chip WIG20 index managed to close 0.63 percent higher, with strong gains by most of the large financials. The overall WIG closed a quarter of a percent higher.

Wednesday saw another reversal, with stocks dipping throughout Europe. Not helping stocks in Poland

Major indices WIG

46,329.66 (February 7 close)

WIG20

2,467.45 (February 7 close)

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

28.01

25.01

24.01

23.01

22.01

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

28.01

2,400

25.01

46,000

24.01

2,440

23.01

46,400

22.01

2,480

21.01

46,800

18.01

2,520

17.01

47,200

16.01

2,560

15.01

47,600

14.01

2,600

11.01

48,000

21.01

52-week low: 2,035.80

18.01

Change year to February 7: -6.05%

17.01

52-week low: 36,653.28

16.01

52-week high: 2,628.36

Change year to February 7: 2.83%

15.01

Change for the week: -1.02%

14.01

52-week high: 48,222.72

11.01

Change for the week: -1.09%

Top 5 BNPPL REGNON NOVAKBM EUIMPLANT RESBUD

Closing 112.90 0.04 5.82 0.14 6.82

% change (week) 52-week high 50.53 150.00 33.33 0.18 22.53 15.81 16.67 0.28 14.43 70.00

52-week low 44.00 0.03 3.70 0.07 4.12

Top 5 PEKAO PKOBP BRE PGNIG BOGDANKA

Closing 159.50 35.17 327.10 5.51 135.00

% change (week) 4.80 1.56 1.11 0.18 -1.10

52-week high 173.10 38.50 338.00 5.86 143.00

52-week low 128.10 30.10 255.70 3.61 114.00

Bottom 5 MEXPOLSKA MEGARON POLJADLO MEWA DMWDM

Closing 1.30 21.35 0.09 0.25 0.28

% change (week) -33.67 -26.38 -18.18 -13.79 -12.50

52-week low 1.25 20.00 0.09 0.18 0.22

Bottom 5 BORYSZEW LOTOS TAURONPE KERNEL TVN

Closing 0.50 36.90 4.43 65.60 9.16

% change (week) -10.71 -7.73 -6.14 -5.88 -5.66

52-week high 0.89 43.78 5.61 76.00 12.40

52-week low 0.48 22.66 4.08 51.00 5.90

52-week high 10.89 38.60 0.77 0.38 0.50

Currency report

RPP cuts rates

Other indices sWIG80

10,950.03 (February 7 close)

WIG-Banki

6,445.36 (February 7 close)

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

28.01

25.01

24.01

23.01

22.01

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

28.01

25.01

6,300

24.01

32.0

23.01

6,380

22.01

32.4

21.01

6,460

18.01

32.8

17.01

6,540

16.01

33.2

15.01

6,620

14.01

33.6

11.01

6,700

21.01

52-week low: 5,163.30

18.01

Change year to February 7: -4.13%

17.01

52-week low: 32.54

16.01

52-week high: 6,723.16

Change year to February 7: 0.39%

15.01

Change for the week: 1.55%

14.01

52-week high: 43.35

11.01

Change for the week: -1.13%

34.0

Adam Narczewski X-Trade Brokers DM SA

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

28.01

52-week low: 8,984.43

25.01

22.01

21.01

18.01

07.02

06.02

05.02

04.02

01.02

31.01

33.35 (February 7 close)

52-week high: 11,245.80

SOURCE: WSE

NewConnect

30.01

29.01

28.01

10,500

25.01

2,500

24.01

10,660

23.01

2,540

22.01

10,820

21.01

2,580

18.01

10,980

17.01

2,620

16.01

11,140

15.01

2,660

14.01

11,300

11.01

2,700

17.01

Change year to February 7: 3.98%

16.01

52-week low: 2,147.52

15.01

Change year to February 7: 0.36%

14.01

Change for the week: -2.63%

11.01

52-week high: 2,646.20

24.01

2,577.94 (February 7 close)

23.01

mWIG40 Change for the week: -0.76%

was uncertainty over future interest rates, with the National Bank of Poland remaining silent after cutting interest rates by a quarter of a percent. Both the WIG and WIG20 fell by about 1.2 percent.

On Thursday, stocks saw small gains throughout Europe, with the WIG20 up half a percent, while the WIG saw a 0.39 percent gain. Shares of TVN saw a 2 percent rebound, after shedding nearly 8 percent in the first few days of the week.

Stocks in Poland shot up on Friday, however, with the WIG up 0.89 percent and the WIG20 higher by 1.13 percent, as bulls took hold globally and the Dow Jones Industrial Average flirted with the level of 14,000 points. ●

Central banks gave major impetus to currency trading this past week. Interest rates remained the same in the euro zone, the UK and Australia, but comments made by the respective central banks’ presidents caused big movements.

As expected, Mario Draghi did not comment directly the danger of a stronger euro, but traders are reading between the lines of the speech “Super Mario” made, causing a major selloff of the euro.

The EUR/USD, which was trading above the $1.36 level (a 16-month high), collapsed to levels below $1.34 by the end of the week. A further downward movement of the major currency pair is expected, although next week the euro should regain some ground.

Poland’s Monetary Policy Council (RPP) did not surprise investors, and cut interest rates by 25 basis points to 3.75 percent.

The RPP did not state clearly if it will continue cutting interest rates or remain on hold in March to see how the situation evolves. I do not think that macroeconomic publications will show much improvement in the economy, so further interest rate cuts should be expected.

The z∏oty remains steady against the major currencies.

The EUR/PLN, which rebounded from its weekly low of z∏.4.14 to reach z∏.4.20 after Marek Belka’s speech, retreated down to finish the week in the region of z∏.4.16.

The USD/PLN, after two weeks of declines, rebounded to z∏.3.10 and is headed towards z∏.3.15. ●

3.3504

3.2912 07.02

08.02

3.2936 06.02

SOURCE: NBP

3.3215 05.02

3.2807 04.02

3.3344 08.02

07.02

06.02

3.0

01.02

0.1028

0.1029

0.1026 05.02

04.02

0.101

01.02

08.02

07.02

06.02

05.02

04.02

01.02

08.02

3.3

PLN-100JPY

3.5

0.1019

0.1027

3.3884

3.4017

3.3841

3.3929

3.3991

4.8891

PLN-RUB

0.103

4.8402

3.3564

PLN-CHF

3.5

07.02

06.02 4.8353

4.8658 05.02

4.8066

4.8629 01.02

08.02

4.8

04.02

3.1056

PLN-GBP

4.9

3.0886 07.02

3.0868 06.02

3.0831 05.02

04.02

3.0744 01.02

4.1882

4.1670 08.02

3.05

3.0563

PLN-USD

3.10

07.02

4.1801 06.02

4.1700 05.02

04.02

4.2028 01.02

4.0

4.1515

PLN-EUR

4.3

0.1030

currency rates

SPORTS

FEBRUARY 11-17, 2013

www.wbj.pl

American football

Soccer

Poland loses international debut

Lewandowski to clarify future in summer

COURTESY OF PRZEMYS¸AW PIOTROWSKI

Poland’s national American football squad made its international debut at the start of February, but despite a partisan crowd in ¸ódê they failed to make it a winning start. The White Eagles went down 27-14 to 2005 European Champions Sweden in front of 6,800 spectators at the Atlas Arena.

Sweden started the match strongly, scoring the first touchdown in within the first five minutes when wide receiv-

er Johan Stahl caught a perfect pass from Anders Hermodsson. Soon after, Mr Hermodsson added a touchdown of his own after using his speed to carry the ball in to the end zone.

Poland’s defense improved in the second quarter and helped the team shut out the Swedes. On offense, Zbigniew Szrejber made history, scoring his country’s first-ever touchdown to enable the Eagles to go into the break down just 13-8.

But hopes of a Polish comeback were ended by two

Zbigniew Szrejber pulls in a pass for a big gain

more Swedish touchdowns.

The first came on another run from Mr Hermodsson in the third quarter and the second when he again found a receiver in the end zone, this time Fredrik Isaksson. The explosion extended the lead to 19 points.

Poland made the score more respectable in the dying moments, with backup quarterback Krzysztof Wydrowski making a spectacular dash into the end zone for six points.

“I am proud of the players, despite the outcome,” said Maciej Cetnerowski, head coach of the Polish national team, after the match. “Obviously, Sweden was a very strong opponent for us. The game turned at the end of the first half when we came so close to taking the lead but were unable to do so.”

Mr Szrejber said the players still enjoyed the experience despite the defeat.

“On Friday, when we received our ‘Eagle’ shirts, all of the players were filled with pride. Although we didn’t win, I think we don’t have anything to be ashamed of.”

Alex Zarganis, David Ingham

The Polish striker has been the subject of intense transfer speculation Borussia Dortmund and Poland striker Robert Lewandowski says he will not talk about the chances of him leaving his current club until the end of the 2012/2013 season.

The 24-year-old, who has scored 17 goals so far this season, has been linked with moves to both Manchester United and Real Madrid, although recent transfer rumors suggest Dortmund’s Bundesliga rivals Bayern Munich may be his most likely destination. The German league leaders will be managed by former Barcelona manager Pep Guardiola from June, and the Spaniard could look to bolster his attacking options with the addition of Mr Lewandowski, who has been in red hot form in recent years.

However, during an interview with German daily Bild last week, Lewandowski said, “Offers and interest might be nice. But I have told all parties that I don’t want to hear any more about this until the summer and I want to focus on

COURTESY OF WIKIMEDIA COMMONS

The White Eagles went down 27-14 to Sweden in ¸ódê

Poland’s Robert Lewandowski BVB.” “I will listen to everything in the summer and will sit down with my agents. I don’t care about anything else right now,” he added.

Mr Lewandowski has often stressed his enjoyment at playing for a Dortmund side that contains fellow Polish internationals ¸ukasz Piszczek and Jakub B∏aszczykowski, but the lure of a big-money move to one of Europe’s giants could prove too tempting a proposi-

tion for the former Lech Poznaƒ man to turn down.

Dortmund chief executive Hans-Joachim Watzke said in a statement that he would be prepared to talk to Mr Lewandowski should the striker decide his future lies elsewhere.

“If Robert really wants to go to another club, we would sit around a table and talk about everything because we have a good relationship,” he said.

David Ingham

For a perfect Valentine's visit www.sanlorenzo.pl

Risto Rante s an Lo Renzo

aL. Jana Pawła

21

ii 36

te L. 22 652 1616 www.san Lo Renzo. PL

22

LIFESTYLE

www.wbj.pl

FEBRUARY 11-17, 2013

Opera

Live forever The Makropulos Affair February 17 Teatr Wielki, Pl. Teatralny 1 Warsaw

COURTESY OF WWMF.PL

This three-act opera was written in the 1920s by Czech composer Leoš Janáček and tells the story of Emilia Marty, a celebrated singer, who was given a potion that gives her eternal life. But after more than 300 years of ever-lasting youth, she discovers that instead of prov-

SOFA

It may be a long time until the traditional summer festival season, but luckily for music fans this February sees the first-ever Warsaw Winter Music Festival, which takes place in the Praga district on the capital’s east side.

rock n’ roll electro outfit Natural Born Chillers, hiphop/funk group SOFA and the upbeat sounding The&.

Other entertainment will include an “ice zone” with ice sculptures, igloos and art installations, a fire-breathing display, as well as multimedia shows in the media park. Day tickets are available from z∏.80.

David Ingham

For more information log on to wwmf.pl

COURTESY OF TEATRWIELKI.PL

Winter wonderland Organized by the people from Miasto Cypel, an organization which aims to promote the areas close to the Vistula River, this two-day event should bring the atmosphere of a summer festival to a much colder climate. The music will be played across three stages (two indoor, one outdoor), with standout acts including Tri-city audio-visual duo Skinny Patrini, Polish-born German singer Olivia Anna Livki,

gor, with set and costume design by Anna Viebrock.

Still one of the best examples of modern opera almost 90 years after it first premiered, this performance will no doubt provide a fitting interpretation of this classic tale.

David Ingham

For more information log on to teatrwielki.pl

xx

Festival

Warsaw Winter Music Festival February 22-23 SOHO Factory, ul. Miƒska 25 Warsaw

ing a blessing, it has left her bitter and upset. When the potion unexpectedly wears off, she subsequently dies a sad death after rapidly aging before the eyes of astonished onlookers.

This version, which is conducted and directed by Gerd Schaller and Christoph Marthaler respectively, sees Eva Johansson and Raymond Very play the lead roles of Emilia Marty and Albert Gre-

LAST WORD

FEBRUARY 11-17, 2013

www.wbj.pl

23

Tech Eye

COURTESY OF NEUROWEAR

Techeye has got to thinking about love recently. That’s probably because our awfully wedded wench has been carping about Valentine’s Day, the peskiest of the chocolate-related holidays.

Back to love, though. Over the years, we’ve come to realize that it comes in a million varieties. There’s The Necomimi Brainwave Cat Ears the great liquidy love of beer, for example, and the sweaty-palmed, of Valentine’s Day, we thought we’d unbridled love of betting on donkey feature products with the potential to racing. There’s also the creepy, old- liven up the drowsy love of married peoply love of sitting on park benches folk. First up, a little something for while staring at nothing. There’s the him or her – the Necomimi Brainromantic love of two birds so busy wave Cat Ears from Japanese firm courting that they fly into windows, Neurowear (Neurowear.com). get little avian concussions and miss These are brainwave-controlled mating season altogether. cat ears, if you haven’t guessed And let us not forget the rumpled, already. The device employs neural underappreciated love of two people sensors (including one that sits promiwho have been married for years. nently on the side of the forehead), as That’s an important one, though it’s well as a fancy algorithm, to let its not always pretty. Indeed, married wearer express certain attitudes via love is a lot like a herd of camels – lots the Necomimi ears, such as “high of bellowing, grumping and jawing, focus” (ears perking up). punctuated by some spectacular Provided they work as advertised humps. (and we’ve never seen it demonstratAnyway, due to the inescapability ed live), the Necomimi ears could

make a good Valentine’s present. to transport up to three growlers At the very least, they make it while driving. As Growler on clear if the wearer’s feeling “high Board states, there’s “no more interest” (ears up and wiggling) or worrying about having your simply “high relaxation” (drooping growlers rolling around in your ears). Cost: $69.99 plus four AAA backseat, floor, or trunk!”

And who doesn’t drive around batteries.

Now here’s something to with giant beer bottles in their remind any married couple car? Well Techeye doesn’t, but of the intoxicating there’s obviously a sizable demoambrosia of love – the Beer graphic of growler-transporters Transport Unit from North out there somewhere.

Anyway, the Beer Transport American outfit Growler on Unit costs $29.99. Growlers not Board (Growleronboard.com).

To appreciate this fully, you included.

Even if the aforementioned fail first need to know what a growler is. There are several definitions, to stoke the embers of passion, you see, but the one we’re inter- this last product is a sure thing.

Feast your eyes on the Personested in (and pretty much the only one you can COURTESY OF alised Superhero Action FigGROWLER ON BOARD discuss in polite ures from Firebox company) is “a (Firebox.com). half-gallon jug, Here’s the skinny. First usually glass, you choose a superused to transhero.

Captain port beer.”

America, CatThe Beer woman, the Tr a n s p o r t Flash, Iron Man, Unit is nothThor and Woning more or der Woman are less than a available; Batfoam conman and Supertainer designed man are currently The Beer Transport Unit

COURTESY OF FIREBOX

Valentine’s toys for rumpled lovers

Personalised Superhero Action Figures out of stock. Then pay £79.99 (yikes) and e-mail two passportstyle photos (front and profile) to Firebox.

Sooner or later, you’ll get a package containing a regular superhero action figure and an extra head bearing a creepy version of your face on it. Decapitate the action figure, then pop your own head on it. Voila!

Personalised Superhero Action Figures are the perfect gift for married lovers. Or, really, anyone who ever wondered what they’d look like with the face of a meth addict and the body of an East German gymnast. ●

Ever dreamed of putting your own head on a Wonder Woman action figure? Let us know: techeye.wbj@gmail.com

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

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

Fibak Gallery ul. Krakowskie PrzedmieÊcie 5 www.galeriafibak.pl

Królikarnia National Gallery ul. Pu∏awska 113a www.krolikarnia.mnw.art.

Galeria 022, DAP, Lufcik pl ul. Mazowiecka 11a www.owzpap.pl Le Guern Gallery ul. Widok 8, Galeria 65 www.leguern.pl ul. Bema 65 www.galeria65.com Museum of Galeria Appendix 2 Independence ul. Bia∏ostocka 9 Aleja SolidarnoÊci 62 www.appendix2.com www.muzeumniepodleglo sci.art.pl Galeria Asymetria ul. Nowogrodzka 18a National Museum in www.asymetria.eu Warsaw Al. Jerozolimskie 3 Galeria Foksal ul. Foksal 1-4 www.mnw.art.pl www.galeriafoksal.pl Galeria Milano Rondo Waszyngtona 2A www.milano.arts.pl Galeria Schody ul. Nowy Âwiat 39 www.galeriaschody.pl Galeria XX1 Al. Jana Paw∏a II 36 www.galeriaxx1.pl Galeria Zoya ul. Kopernika 32 m.8 www.zoya.art.pl Green Gallery ul. Krzywe Ko∏o 2/4 www.greengallery.pl

Polish National Opera at Teatr Wielki Pl. Teatralny 1 www.teatrwielki.pl

Simonis Gallery ul. Burakowska 9 www.simonisgallery.com State Archaeological Museum in Warsaw ul. D∏uga 52 www.pma.pl State Ethnographic Museum ul. Kredytowa 1 www.ethnomuseum.we bsite.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

Pracownia Galeria Wilanów Palace ul. Emilii Plater 14 Museum and Wilanów www.pracowniagaleria.pl Poster Museum ul. St Kostki Potockiego Rempex Art and 10/16 Auction House www.milanow-palac.pl ul. Karowa 31 www.postermuseum.pl www.rempex.com.pl Royal Castle Pl. Zamkowy 4 www.zamekkrolewski.com.pl

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

Ingredients of culinary excellence We invite you to taste the delicious dishes of modern Polish cuisine with a distinct touch of the most sophisticated culinary trends.

Pałac Sobańskich, Al. Ujazdowskie 13, 00-567 Warsaw Booking: (+ 48) 22 523 66 64 www.amberroom.pl

Michelin Guide Recommendation