Polish Market No. 2 (175) 2011

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					Polish Market :: 02/2011




                           15 YEARS
                           PUBLISHED SINCE 1996
                           No. 2 (175) 2011   ::   www.polishmarket.com.pl




                            CLUSTERS:
                            a way to foster regions

                            Ranking
                            of insurance
                            brokers

                           Partnering
                           with the East




                           AGRICULTURE:
                           chances for development


                                                   Marek Sawicki PhD
                                                                       Minister of Agriculture and Rural Development
        The International Year of Forests, 2011
        “Celebrating Forests for People”
The United Nations has officially commenced celebrations of the         forest resources in our country has been checked and the trend
International Year of Forests. Its main slogan “Celebrating For-      has been reversed. In terms of forest area, wood resources as
ests for People” makes us aware of how very important forests         well as the wealth of flora and fauna Poland is now in the top Eu-
are in the life of each of us. Forests ease the climate. They pro-    ropean league.
vide wood, healing resources and living means to people through-
out the world.
                                                                                 Forests in Poland are expanding.
Forests for People – the slogan of the International Year of For-                For us and for future generations.
ests – describes Polish forests very much accurately. Also in the
literal sense because most of the forests in Poland are under pub-                Forests in Poland are open to all.
lic administration, mainly that of the State Forests Authority, and
hence are accessible to everybody. The value of our forests can                           Forests protect life.
hardly be precisely assessed because they affect every aspect of
human life in a direct as well as indirect way. This value is cer-      Forests are employers and partners in business.
tainly rising because forests in Poland are consistently expand-
ing. Due to foresters’ endeavours, the centuries-long shrinking of     Wood is a renewable and ecological raw material.
 Contents

                                             2/2011
                                                                               MAZOVIA       # 36

                                                                                           Grzegorz Benedykciński, Mayor of Grodzisk Mazowiecki:
                 From The President’s Press Office     #6                                  A well-managed commune # 38

                 From The Government Information Centre         #7
                                                                               TOURISM

 OUR GUESTS
                                                                                           Imagine Poland...   # 41
                 Janusz Lewandowski, PhD, Polish economist and                             Incoming tourism to Poland    # 42
                 politician # 8                                                            Janusz Turakiewicz: Polish hotel industry in 2011      # 44


                 Marek Sawicki, PhD, Minister of Agriculture and Rural         RANKING OF INSURANCE BROKERS
                 Development # 10
                                                                                           Rita Schultz: Insurance broker – risk advisor     # 46
                                                                                           Jacek Kliszcz, President of PWS Konstanta: Stability and
 AGRICULTURE
                                                                                           wise conservatism # 50

                 Polen Schmeckt     # 12
                 Andrzej Janc, Director of the Agricultural Insurance                      Aleksander Leszek Konopka, President of the
                 Office at Concordia: An aware farmer has solid                            Management Board of Gras Savoye Polska: The Polish
                 insurance # 16                                                            brokerage # 52
                 Prof. Alojzy Szymański, Rector of the Warsaw University
                 of Life Sciences (SGGW): We’re educating professionals
                 for the Polish economy # 18                                   OPINION


                 Prof. Tomasz Borecki, former rector of the Warsaw                         Prof. Krzysztof Żmijewski: Pecking order        # 53
                 University of Life Sciences and present rural and                         Andrzej Arendarski, PhD: Far from average wealth         # 54
                 agriculture Advisor to the President of RP: The road
                 to changing the countryside leads through hard
                 work # 22

                 Paweł Krajmas, President of the Polish Ecology                INVEST IN POLAND        # 55
                 Association, owner of “Jasiołka,” a producer of organic
                 food: Our products are innovative products # 24                           Sławomir Majman, President of the Polish Information
                                                                                           and Foreign Investment Agency (PAIiIZ): Poland should be
                 The Agri-winners     # 26
                                                                                           like Channel no. 5 # 56
                 Mikołaj Oniszczuk, member of the General Council
                 of the Association of Polish Exporters, an experienced
                 diplomat and economist: Exporting food is like exporting      EURO 2012      # 58
                 health # 30

                 Wiesław Różański, president of the Meat Industry              REGIONAL DEVELOPMENT
                 Producers and Employers Union (UPEMI): The world
                 savours Polish food # 33
                                                                                           Elżbieta Bieńkowska, the Polish Minister of Regional
                 Marian Pigan, Director General of the State Forests                       Development: We carried out all our plans for last
                 Mazovia: I would like to invite you to the Polish forests –               Lear # 59
                 open to everyone # 34




2 ::   polish market :: 2/2011
 Contents


                 Elżbieta Wojnicka, PhD: Clusters – cooperation for                                            Anna Piecuch, attorney at law, Head of the Department
                 competitiveness # 61                                                                          of the Public Procurement, Chałas & Partners Law
                                                                                                               Firm: Polish public procurement market – a tidbit or
                 Paweł Barański, tax adviser and director at the Katowice
                                                                                                               a bureaucratic trap? # 79
                 office of the professional services firm KPMG: Sufficient
                 income needed to benefit from tax breaks # 63

                 Investors are very impressed with Polish special economic                  POWERFUL BUSINESSWOMEN
                 zones # 64
                                                                                                               Iwona Kossmann, President of the Board at Bonnier
                                                                                                               Business Polska # 80
 EASTERN PARTNERSHIP

                 Doing business in Russia. An overview of trouble                           HISTORY OF BRANDS
                 zones # 67

                 Zygmunt Kostkiewicz, president of the Management                                              The artistic spirit         # 82
                 Board of Export Credit Insurance Corporation Joint Stock
                 Company KUKE SA: Known among exporters # 70
                                                                                            CULTURAL MONITOR
                 Jerzy Kurella, Vicepresident of the Management Board
                 of BGK: The economic crisis is a serious danger to Polish                                     Cultural Monitor            # 84
                 exports # 71                                                                                  Górecki’s music to accompany the Warsaw
                                                                                                               Ballet… # 86

 INFRASTRUCTURE
                                                                                            CEOS AFTER HOURS
                 Magdalena Szwed: Structural investment to impel
                 construction in Poland # 72                                                                   Franz Fuchs, Chairman of the Compensa Group                             # 90


 LAW                                                                                        EVENTS

                 Maja Sujkowska, Chairperson General Partner’s                                                 20 years of BCC         # 88
                 Board at European Center for Legal Consultations:
                 “Foreign-currency” hunting # 78                                                               Deni Cler MILANO             # 92
                                                                                                               2010 Vector Awards            # 94
                                                                                                               The 19th Laurels of Skill and Competence 2010 Award
                                                                                                               Gala # 96




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                                        Oficyna Wydawnicza RYNEK POLSKI Sp. z o.o.          Sylwia Wesołowska-Betkier                         – Stanisław Roszkowski,
                                        (RYNEK POLSKI Publishers Co. Ltd.)                 Translators: Maciej Bańkowski, Konrad Gocman,     www.drukarniataurus.pl
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                                        President: Krystyna Woźniak-Trzosek                                                                  Basic circulation: 8,000
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                                        Vice-Presidents:                                   Jolanta Wolska
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                                        E-mail: info@polishmarket.com.pl                   k.malinowska@polishmarket.com.pl                  Published articles represent the authors’ personal
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                                        Editor-in-Chief: Rita Schultz                      natalia.s@polishmarket.com.pl                     responsibility or liability for their contents. Unso-
                                        rita.schultz@polishmarket.com.pl                   Ewelina Surma                                     licited material will not be returned. The editors re-
                                                                                           e.surma@polishmarket.com.pl                       serve the right to edit the material for length and
                                        Editorial board:                                                                                     content. The editors accept no responsibility what-
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4 ::   polish market :: 2/2011
                                                                                                                        Editorial

While countries are coming out of the                               Notwithstanding heated disputes over the
global economic crisis and endeavour in                             national budget, political scuffles and dreary
various ways to protect themselves against                          weather, this issue of the magazine emanates
its recurrence, some unexpected develop-                            optimism. “During the last six months, Po-
ments may still take place here and there.                          land’s perception abroad as a place of invest-
Fears are rife particularly in Europe after                         ments has improved significantly. Its position
what happened in Iceland, Greece and Ire-                           in this respect went up in all rankings. We have
land. It is predicted by some that a public fi-                      managed to show that Poland is a good country
nances crisis might hit even Poland once it                         to invest in,” says Sławomir Majman, president
lost its position of growth leader in favour of Sweden after be-    of the Polish Information and Foreign Investment Agency (PAIiIZ)
ing hailed as the “Green island” for two years.                     in an interview for “Polish Market.”

Poland knows its history well enough not to ignore the danger-      Inspiring news is reported in this issue from Berlin: Polish products
ous prospects of a public fi nances collapse. 400 years ago, when    have won high acclaim at the annual Grüne Woche (Green Week)
Poland was at the peak of its economic growth and fought vic-       event, the world’s biggest fair for food, agriculture and horticul-
torious wars with Moscow, the Russian Tsar came to Warsaw in        ture. Polish Minister of Agriculture and Rural Development Marek
1611 to pay homage to the Polish monarch. But fi nal victory did     Sawicki comments that farmers abroad might learn a lot from their
not come. Due to the country’s public fi nances crisis, the Polish   Polish counterparts. Farmers have contributed most to Poland’s
army was forced to retreat. One year later, the Russian state was   foreign trade success in exports of agricultural and food products.
restored. Nearly 200 years later the Tsar crowned himself king
of Poland. Poland was wiped off the map of independent states        Tourism is another major topic dealt with in this edition. Unfor-
for more than one hundred years. The Continent’s division into      tunately still underfi nanced, it is another asset Poland has. Ours
Europe of two speeds had thus been doomed.                          is a country that can satisfy the interests and likings of even the
                                                                    most exacting tourists. It has a rich and varied countryside, fabu-
Can any conclusions be drawn from these past events? Certain-       lous mountains, seashore with sandy beaches, thousands of lakes
ly one is that any conceivable fi nancial crisis in Poland would     and caves. It abounds in historical relics and monuments. Promo-
not become a turning point in the Continent’s or world’s his-       tion of Poland’s tourist facilities should obviously become one of
tory nowadays. The make-up of international economic ties is        this country’s priorities.
now entirely different. An economic crisis of one country does
not catapult the growth of its neighbours. We all share the same    Featured in this edition are issues concerned with entrepreneurship
lot these days and it is the domino effect that is typical. That     and the support that is given to its development. The significance
shows best at least in Europe. Both with regards to the mech-       is highlighted of business clusters and Special Economic Zones.
anism of recession and the coming out of the downturn. While        The recent years saw the implementation of numerous undertak-
Europe was slumping into crisis and its governments were out-       ings, funded mainly by the EU, aimed at stimulating, among oth-
doing each other in launching anti-crisis schemes, Poland was       ers, the development of business clusters. These are set up in tradi-
censured for being not sufficiently active in this respect and        tional sectors (such as are involved in ecological food production)
was outright railed against for trying to sneak through the         as well as in high technology fields.
crisis at the expense of others. It follows that the perspective
has now to be changed in view of the fact that the Polish econ-     Published in this edition is the ranking of insurance brokerages in
omy has not only been just a “Green island” but turned to be        Poland. Insurance brokerages have been operating in this country
also an anchor, one of the small rocks to help stop the domino      for more than 20 years and in a way their performance also reflects
effect in Europe and become the bedrock of Europe’s growth.          the rate of progress Poland has made in its economic growth over
We have become used to the fact that Europe’s economic con-         the past two decades. Increasingly more corporate property is en-
dition is determined by giants - Germany, France and the UK.        trusted to brokers to obtain the right insurance. Th is reflects grow-
That Germany’s rejoining the three biggest global exporters         ing awareness of the need to protect corporate property as well as
signifies renewed good auguries for Europe. It is but high time      rising confidence in business environment facilities.
to take note that Germany’s exports to the V4 Visegrad group
countries (Poland, Czech Republic, Slovakia, and Hungary) is        As of this edition we start-off a new series of feature reports devot-
bigger than to the United States, Great Britain or Russia. That     ed to Poland’s influential woman-managers. In it we shall present
Poland is not only a good partner as supplier of subassemblies      members of the fair sex who made it to the top, who can boast im-
and quality food but also a major secondary market for trans-       mense expertise and prestige on account of their determination,
portation vehicles, construction and agricultural machinery.        resourcefulness and ambition. The fi rst to be introduced is Iwona
That big public investments in Poland spur on the economy in        Kossmann, the President of Bonnier Business Polska. She remarked,
Germany, Austria, Sweden, Spain and elsewhere. These are            among others: “Let’s be ourselves in business. Th is can produce fan-
facts worth acknowledging in the run up to Poland’s EU Pres-        tastic results and great professional satisfaction.”
idency because it follows that we have learned the great les-
sons of history.                                                    I wish them all every success.

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



                                                                                                             2/2011 :: polish market ::   5
                                                                            Integration with the Western world
                                                                                                      Following his encounter in Davos with
                                                                                                      Ukrainian President Viktor Yanukovych,
                                                                                                      Bronisław Komorowski reiterated that Po-
                                                                                                      land will consistently support Ukraine on
                                                                                                      its path to integration with the West. He
                                                                                                      said Poland would share its expertise with
                                                                                                      Ukraine on visa-free movement. “We know
                                                                                                      how important this matter used to be for
                                                                                                      Poland,” he said. In this context Bronisław
                                                                                                      Komorowski referred to the issue of estab-
                                                                                                      lishing a visa-free traffic in the framework
                                                                                                      of the border traffic convention. He also
                                                                                                      said Poland will keep its fi ngers crossed for
                                                                                                      Ukraine’s success in its endeavours to in-
                                                                                                      tegrate with the West. And that especial-
                                                                                                      ly so because Ukraine is not confi ning itself
                                                                                                      to just talking about its chances of integra-
                                                                                                      tion. It has proved by many deeds that it is
                                                                                                      actually working actively toward that end.
                                                                                                      The Polish President praised the Ukraini-
                                                                                                      an Parliament in particular for adopting a
                                                                                                      package of laws, including those on energy
                                                                                                      transmission, drafted in the spirit of Euro-
                        The World Economic Forum in Davos                                             pean standards. The Polish head of state also
                                                                                                      spoke in support of Ukraine’s negotiations
While attending the 41st World Economic Forum in Davos, President Bronisław Komorowski                on free trade with the EU. Viktor Yanuko-
was the guest of honour at an event organized by the Warsaw Stock Exchange. He described              vych remarked on his part that his coun-
the Warsaw bourse as “a symbol of transformations that have been taking place in Poland over          try is vitally concerned with improving its
the past 20 years. The success of the Warsaw Stock Exchange can be seen as a reward for cour-         trade with the EU and expressed hope that
age during the systemic transition and a sign of triumph of the free market economy,” he said.        obstacles in this respect will be overcome.
    During his stay in Davos, President Bronisław Komorowski met with his Azerbaijani coun-           He added that economisation of Ukraine’s
terpart Ilham Aliyev, President of the Swiss Confederation Micheline Calmy-Rey and the Head           relations with other countries and improv-
of the World Economic Forum Klaus Schwab. He also participated in a panel discussion with the         ing its business environment for foreign in-
President of Ukraine, Viktor Yanukovych, promoting the UEFA EURO 2012 European Football               vestors has been one of his country’s prior-
Championship.                                                                                ::       ities.                                      ::




Gender parity bill signed into law
President Bronisław Komorowski signed               of democratic participation in the function-      of parliamentary elections (except the Sen-
into law the gender quota bill which intro-         ing of the state,” said President Komorowski.     ate) and EU parliamentary elections as well
duces a 35% gender parity on electoral lists.            The signing took place in the presence of    as commune, county and regional council
     The President said that by having done so      representatives of the Congress of Women,         elections must be female. At least 35% must
he fulfi lled his promise given during the Con-      which initially drafted the bill, after hav-      be men.
gress of Women last June. “I treat it as part of    ing been signed by 150,000 people. The book           Specific regulations say that if a candi-
a task that we are all facing, as beyond doubt      “Time for women” summing up the Congress          date withdraws from the election race after
now is the time when we must make sure that         debates was subsequently presented by the         the electoral list was registered, the list is
this act, this legal solution, is fi lled with the   Congress representatives to the President. “It    still valid notwithstanding the fact that the
best possible content of actual policy-making.      is a good time now for women active in pub-       35% quota is not met. If there are three can-
It is now essential that political parties, non-    lic life. The legal framework is in place. Eve-   didates on an electoral list, at least one has to
governmental organisations, and also women          rything has to be done to ensure that women       be a woman and one a man.
actively involved in political and civic mat-       well-prepared to carry out public duties fi nd         The law does not apply to elections of sen-
ters substantiate with their activity the fact      their place in Parliament,” said Komorowski       ators (members of the Upper House of Par-
that this is a solution that serves useful pur-     in response.                                      liament) and council members in communes
poses. That in itself is a great value. What I           According to the new law, at least 35% of    with a population of up to 20,000 (where ma-
mean here is the deepening of the mechanism         the names submitted on electoral lists ahead      jority elections are held).                     ::



6 ::   polish market :: 2/2011
                                                                                      500 days to EURO 2012
                                                                                      “With 500 days to go before the EURO 2012 Football
                                                                                      Championship, we can say with satisfaction that we have
                                                                                      managed to carry out the main objectives as regards pre-
                                                                                      paring the country for the event,” Prime Minister Donald
                                                                                      Tusk said. He added that in the run-up to EURO 2012, 81
                                                                                      crucial investment projects to the tune of more than PLN 88
                                                                                      billion would be completed throughout the country. “New
                                                                                      stadiums and motorway sections are being constructed,
                                                                                      regional airports expanded, and railway stations built or
                                                                                      modernised. Work on more than 80% of these projects is
                                                                                      far advanced.”
                                                                                          Donald Tusk pointed out that the EURO 2012 Football
                                                                                      Championship offered an enormous developmental oppor-
                                                                                      tunity for Poland. “We expect that the event will gener-
                                                                                      ate more than 30,000 new jobs. It is estimated by experts
                                                                                      from the Warsaw School of Economics that EURO 2012–
                                                                                      related investments will raise Poland’s GDP in the years
                                                                                      2008-2020 by about 2.1%, that is by PLN 28 billion. The GDP
                                                                                      growth will be primarily accounted for by infrastructur-
                                                                                      al investment projects, the development of tourist serv-
                                                                                      ices and the operation of sports stadiums and hospitality
                                                                                      centres.”                                                 ::



“Yes” to nuclear power
The government has decided to put Poland’s first nuclear power               as radioactive waste and burnt-out nuclear fuel management. Provi-
plant on stream by 2020. It also approved requisite regulations for the     sions are to be laid down securing the country’s nuclear safety and ra-
development of nuclear power engineering in the country in the years        diological protection as well as liability for nuclear damage. Regula-
to come. Another plant is to be completed by 2030.                          tions have been drafted governing expropriation proceedings in areas
    Work on the government long-term “Programme of Polish nucle-            where nuclear power stations are to be set up. Compensation for ex-
ar power engineering” was launched in May 2009. Many issues con-            propriation will be paid by the State Treasury.
cerned with the secure development of nuclear power engineering                 The government has stipulated that the public at large be fully ad-
have already been tackled.                                                  vised about all aspects of nuclear power engineering development. An
    The regulations already adopted envisage the laying down of trans-      educational and information campaign to this effect is to be launched.
parent and stable legal frameworks covering the whole investment proc-      To start with, nuclear power plant investors have been obliged to run
esses of building and operating nuclear power plants. Specific regula-       Local Information Centres. Local Advisory Points in communities will
tions are yet to be drafted to govern the operation of the plants as well   also run.                                                             ::




Polish-Finnish relations
“Finland is exemplary in overcoming the on-going finan-
cial crisis. It belongs to the exclusive club of countries enjoy-
ing favourable economic growth,” said Polish Premier Donald
Tusk after meeting his Finnish counterpart Mari Kiviniemi.
The issues discussed during the meeting included economic
relations, nuclear power engineering, the financial crisis and
Polish-Finish relations with Russia. The Polish Prime Minis-
ter pointed out that Polish-Finish relations were developing
well. This, he said, was evidenced by the many Finnish in-
vestments in Poland, and the cooperation of both countries,
notably in the arms industry and nuclear power engineering.
    Referring to Polish-Finish relations with Russia, a ma-
jor issue discussed by the two heads of government, Mari
Kiviniemi observed on her part that the warming-up of re-
lations between Poland and Russia had a favourable impact
on EU policies. She also spoke appreciatively about the East-
ern Partnership scheme.                                         ::

                                                                                                                       2/2011 :: polish market ::   7
 Our guest



Budget? Realistic and ambitious!
“Looking at the 2007-2013 budget, I see that Poland – as the main                                                   the development of the benefiting
                                                                                                                    country but is more difficult to absorb
beneficiary of EU funds in that period – has mainly satisfied its ‘local’                                             because it involves the need to over-
hunger for investment projects. We should not have excessive expectations                                           come a barrier whereas direct pay-
                                                                                                                    ments to farmers are easier to obtain.
for the next budget in a crisis-hit Europe but I would like the proposal                                            In fact, these countries do not need to
for Poland to be at least decent,” says EU Commissioner for Financial                                               make any effort in that respect because
                                                                                                                    at least one of the most powerful coun-
Programming and Budget Janusz Lewandowski.                                                                          tries in Europe – France - will do it for
                                                                                                                    them. Poland does not have to be on
                                                                                                                    the front-line over this issue. I expect
                                                                                                                    that countries in our part of Europe
                                                                                                                    will fi rst of all take care to defend the
                                                     What will the 2014-2020 budget be like?                        cohesion policy because there are still
                                                 We will know the figures in the last week of June. For now,         big disparities in Europe – in terms of
                                                 I can say that our proposal will be realistic. Last year, our      transport, telecommunications, ener-
                                                 proposal was judged as too ambitious by the Council – the          gy as well as in living standards. The
                                                 paymaster of the EU in a way, it rejected our proposal and         per-capita GDP indicator does not al-
                                                 proposed its own starting point. We have to be realistic to        ways fully demonstrate the gap be-
                                                 make sure that our proposal becomes indeed the starting            tween a rich country, where private
                                                 point. However, the budget has to be ambitious because the         wealth has been amassed for gener-
                                                 European Union has more and more common competencies               ations, and Central and Eastern Eu-
                                                    in cost-intensive areas such as energy security, common         rope, which is working its way up and
                                                     immigration policy and guarding borders. On that front,        where most of the money in household
                                                      we very much count on support from the European Par-          budgets is still spent on living expens-
                                                      liament – we have already been given such assistance          es. Only by measuring this gap can we
                                                       in defending the annual budget for 2011. We are “get-        see how long the process of catching
                                                       ting ready to jump” and I think it will be the most dif-     up will be. I think that the agricul-
                                                        ficult jump ever in the history of negotiations within       tural policy – however outmoded and
                                                        the EU. First, we will have to wage a battle for the an-    criticised by some – will emerge un-
                                                        nual budget. We already had a foretaste of that in 2010     scathed from the budget negotiations
                                                         when we negotiated the 2011 budget. A proposal for the     because it will have strong supporters.
                                                         EU budget for 2012 will be announced end of April. It      The poorer part of Europe is developing
                                                          will be very important. The projects cofunded by the      thanks to structural funds, which are
                                                           EU in the member states have gathered momentum           spent on building roads and bridges
                                                            and payments are increasingly high. Poland wants        and sometimes represent investment
                                                            to account for PLN50 billion this year and similar      in “grey matter.” As regards agricul-
                                                            signals are coming from almost all EU countries,        tural policy, the goal now for Poland is
                                                               with the exception of three or four of them. The     to receive slightly more than previous-
                                                                 problem is that in the current climate, it will    ly. From a pan European point of view,
                                                                    be immensely difficult to force through in-       maybe it would be worth slightly de-
                                                                      creases in the EU budget. I anticipate pre-   creasing the fi rst pillar of agricultur-
                                                                        senting our proposal for the post 2013      al policy (direct payments) in order to
                                                                         period end of June, but taking into ac-    invest more in research, development
                                                                          count the current climate, I can tell     and foreign policy.
                                                                          you that it will be conservative.
                                                                                                                        Will you be proposing a change in
Janusz Lewandowski (born 1951) is an economist and politi-                  How much will it affect the cohe-            the agricultural policy to increase
cian. He holds a Ph.D. in economics. He served as an economic ad-           sion policy and the common ag-              spending on rural development at
visor to “Solidarity” in 1980 – 1989. He was the minister of privati-       ricultural policy?                          the expense of agricultural pay-
zation in 1990-93, when he participated in creating the Warsaw          Some say that many of the poorer                ments?
Stock Exchange and developed the privatization plan. He was a           countries which have problems with          Th is spending proportion should be in
Member of European Parliament in 2004 to 2010 until he was ap-          absorbing structural funds will be fo-      favour of the rural development fund,
pointed as the EU Commissioner for Budget and Financial Plan-           cusing in the negotiations on “easy”        which – together with other European
ning in February 2010.                                                  money, that is on agricultural policy.      funds – should build the EU territorial
                                                                        Money from structural funds supports        cohesion policy. However, this should

8 ::   polish market :: 2/2011
                                                                                                                               Our guest




be done gradually over several years rather than through                              Looking at the seven year period ending in 2013, I see that
fundamental revolution.                                                               Poland – as the main beneficiary of EU funds – has satis-
    According to report, some of the bigger member states                             fied mainly its “local” hunger for investment projects. Lo-
would like to talk fi rst of all about the agricultural poli-                          cal governments have gathered strength and started to in-
cy and, on the other hand, on retaining some privileges                               vest. Th is can be seen everywhere in Poland. Each province
in their contributions to the EU budget. Th is would be at                            is now carrying out from 8,000 to over 10,000 projects par-
the expense of the cohesion policy. The cohesion policy –                             tially funded by the European Union. The “local” hunger
adopted in the 1980s when the EU admitted poorer coun-                                has been satisfied to some extent but local governments had
tries, however not as relatively poor as post-communist                               to incur some debts. I would like large projects to be con-
countries – was an expression of European solidarity. But                             ducted in the next seven-year period, projects that would
in 2011, in a climate of austerity and crisis, the policy does                        change our transport map, integrate us with Europe, and
not seem to have many supporters.                                                     give us energy security in the form of new energy links. ::

    What then will be the priorities of the next budget?
We have to favour evolution over revolution. We want the
agricultural policy to remain a common policy instead of
being a national policy. Otherwise, it would be difficult for
the poorer countries in Central and Eastern Europe to offer        I think that the agricultural policy – however outmoded and criticised by
payments to farmers. Th is policy should stay in place but the    some – will emerge unscathed from the budget negotiations because it will
huge differences in direct payments across Europe should           have strong supporters. The poorer part of Europe is developing thanks
be narrowed down. Th is policy should still be a policy of        to structural funds, which are spent on building roads and bridges and
the European Union and should be the same for all coun-           sometimes represent investment in “grey matter.”
tries, however, with no flat-rate payment per hectare across
the EU. Secondly, we will be trying to support the cohe-
                                                                                                                                      ADVERTISEMENT
sion policy, which should account for one-third of the EU
budget. However, the share spent on foreign policy should
grow. It is likely that the developments that are now tak-
ing place in North Africa will mean the need to strength-
en our good neighbourhood instruments. In this seven-
year period, the EU has set aside almost EUR13 billion for
its neighbours. It will certainly be necessary to support
democratisation processes in many countries surround-
ing the EU, which will mean the need to increase this pot
of money. More funding is obviously needed for the inno-
vation policy, common security policy, immigration con-
trol policy and so on. I would like to stress that never before
has there been such a tension between new tasks trans-
ferred onto the Community level and the reluctance to pay
on the part of member states. The Lisbon Treaty has wide-
ly expanded the EU’s competencies at a time when Mem-
ber States are in crisis and do not want to provide funding
for these competencies.

    What will happen to investment projects in Poland af-
    ter 2012?
Poland is lagging behind in terms of transport infrastruc-
ture. The recent sharp acceleration in infrastructure in-
vestment in Poland in the run-up to the Euro 2012 foot-
ball tournament will still not be enough to bring Poland
close to European standards after many years of neglect.
We need not only decent airports but also trains travel-
ling at a speed of 300 kilometres per hour, grade-separat-
ed roads and waterways, including those that existed sev-
eral hundred years ago, such as for example the waterway
from Berlin to Königsberg. Th is waterway could be revi-
talised with EU assistance to take some traffic off roads.

                                                                                                                     2/2011 :: polish market ::   9
 Our Guest




Marek Sawicki, PhD, Minister of Agriculture and Rural Development, talks to Rita Schultz about genetically
modified food, the competitiveness of Polish food and chances for development in Polish agriculture.




                           What is your position on geneti-          At the same time, attention should       two pillars: CAP I – supporting farmer
                           cally modified food?                    be paid to the fast growing demand for      income, and at the same time main-
                       Th is is a very complex problem. I was     food produced using traditional meth-       taining food prices at a relatively low
                       opposed to the European Commis-            ods. Th is market segment is develop-       level, and II – supporting the devel-
                       sion’s proposal, from July of last year,   ing quickly.                                opment of rural areas. In order for the
                       giving member states the freedom to                                                    system to work and be development-
                       decide regarding GMO crops. Th is is           What are the biggest problems           oriented, the relationship in the di-
                       the way that the Commission would              standing in the way to the Com-         vision of funds between pillar I and
                       like to unload responsibility onto             mon Agricultural Policy in the EU?      II should be 50: 50. Without a real re-
                       these countries. In effect, the ban on      We entered the EU in 2004 and since         form, European farming will not be
                       GMO crops would be retained in some        that time we have been covered by           competitive on the world markets.
                       countries while in others they would       mechanisms arising out of the Com-
                       continue to be cultivated. The rena-       mon Agricultural Policy (CAP). In the           How do you assess the level of
                       tionalisation of EU decisions is a bad     period of 6 years, certain modifica-             Polish food production?
                       direction. Such actions can lead to        tions have been made, but before us         The last few years confi rm our position
                       disturbances in competition between        now are decisions regarding the shape       as a food producer. Sales of agricultur-
                       member states.                             of CAP past 2013. We would like the         al and food products is the only area of
                                                                  new policy to be up to the challeng-        foreign trade where we are constant-
                                                                  es that are ahead. Hence, it has to be      ly achieving a positive trade balance.
The last year was a good one in terms of exports. During          considerably simpler, understandable        The balance of trade in these products
the period of January – September 2010, the value of              to all and lacking in historical entitle-   stays at a level of EUR 2-2.5 billion.
agricultural and food product sales abroad amounted to            ments to payments. We should work           Polish products are sought after by EU
a total of EUR 9 593 million, a 12.7% growth compared to          out new, transparent rules, the same        consumers, but they are also becom-
the same period of 2009.                                          for all. We should continue to maintain     ing highly regarded in third country

10 ::   polish market :: 2/2011
                                                                                                                                   Our Guest


markets. An active pro-export policy        products testify to this quite well. The   difference between smoked ham and
has allowed the achievement of many         ability to deal with difficult situations,   pork neck. Here, ham is ham and pork
international agreements regarding          especially with unequal support, en-       neck is pork neck. Excellent raw ma-
our products’ access to new markets         hances competitive abilities, but this     terials and traditional recipes togeth-
in Asia, the Far East and America. The      should not be like this for much long-     er produce superb results.
production capabilities of our modern       er, since this interrupts and deforms
plants and efficiency on new markets          competition.                                   You are an advocate of biofuels,
allow us to allocate our food surplus-          Also, I call your attention to one         however they have not become
es on the common market as well as          other important aspect. The Polish             popular. What is more, recent-
on promising new markets in third           Agency for Restructuring and Mod-              ly everyone has forgotten about
countries.                                  ernisation of Agriculture was last year        them. Are they not a future ener-
                                            the best institution of its type in the        gy source, after all?
    What export successes can Polish        EU, implementing the Rural Devel-          Th is is not only up to me. I am con-
    farming boast about?                    opment Policy. We got ahead of coun-       vinced that renewable energy sourc-
The last year was a good one in terms       tries such as Germany and France,          es will develop regardless. There is no
of exports. During the period of Jan-       countries that have participated in        other alternative. Utilisation of agri-
uary – September 2010, the value of         the mechanisms of the Common Ag-           cultural by-products as fuel is the right
agricultural and food product sales         ricultural Policy much longer. Maybe       direction. Th is market is developing.
abroad exceeded EUR9.59 billion,            then it is worthwhile to learn from us?    There has to be greater competition
a 12.7% growth compared to the same                                                    among producers of equipment of siz-
period of 2009.                                 How are Polish farmers able to         es appropriate for each farm. Changes
    In the export structure of the ag-          compete with those from France         are also happening in legislation. ::
ricultural and food products, the EU’s          or Germany, who receive higher
share fell from 80.5% during January-           subsidies?
September 2009, to 79.4% in the same        I have mentioned this already, we pos-
period of 2010. The value of exports to     sess the ability to function in difficult
countries of the Commonwealth of In-        conditions. We produce very good ag-            However, our biggest partner is Germany, with 22.2%
dependent States (CIS) was EUR 992          ricultural products and raw materi-              of overall agricultural and food exports destined for
million and compared to the three           als. Thanks to tradition and respect                that market. In terms of sales values, this market
quarters of 2009, it grew by as much        for preserving the surrounding en-              has been dominated by smoked fish (mainly salmon),
as 31.5%. Th is situation is primarily      vironment for future generations, we                poultry, biscuits, waffles and other bakery goods,
the result of considerable growth in        avoided excessive chemical pollution                   fruit juice, vegetable oils (mainly rapeseed oil),
the value of exported sugar, chocolate      of the soil and preserved traditional             frozen fruit (mainly strawberries and raspberries),
and chocolate products, milk prod-          farming methods. We offer delicious                  and chocolates and chocolate products. Italy and
ucts, meat and meat products, fresh         products that consumers are look-                     the Netherlands received mainly cigarettes and
apples and champignons. Exports to          ing for and that are not mass-pro-                       beef from Poland. The Russian market mostly
CIS countries made up 10.3% of the          duced, where it is difficult to tell the                    purchased apples, but also cheese and meat.
total value of agricultural and food
product exports.
    However, our biggest partner is
Germany, with 22.2% of overall ag-
ricultural and food exports destined
for that market. In terms of sales val-
ues, this market has been dominated
by smoked fish (mainly salmon), poul-
try, biscuits, waffles and other bakery
goods, fruit juice, vegetable oils (main-
ly rapeseed oil), frozen fruit (main-
ly strawberries and raspberries) and
chocolates and chocolate products. Ita-
ly and the Netherlands received main-
ly cigarettes and beef from Poland. The
Russian market mostly purchased ap-
ples, but also cheese and meat.

   What can Polish farmers learn from
   their foreign counterparts?
Experiences of the last seven years
show that foreign farmers should be
learning from us. Successes in inter-
national trade in agricultural and food

                                                                                                                        2/2011 :: polish market ::   11
 Agriculture



Polen Schmeckt
First impression: I walked into a giant grocery store, with an area of 115,000                            exhibit at Grüne Woche. That is why
                                                                                                          the fair resembles a giant delicatessen.
m2, where products are sold from almost all over the world: packaged,                                     However, Berlin was visited by main-
weighted and per unit, in bottles, cartons and baby cartons, showcasing                                   ly regional producers of milk products
                                                                                                          (including oscypek – Polish smoked
individual countries. This is the most concise way to characterise the 76th                               sheep cheese), cold meats, sweets and
Grüne Woche trade show in Berlin, which has been organised for 85 years.                                  pastries, honey, fruit and vegetable
                                                                                                          preserves, juices and … beer, which
This year’s edition (21-30 January) featured Poland in the role of partner                                was sold at higher prices than well-
country, presenting itself under the resounding slogan – “Polen Schmeckt.”                                known, foreign brands at other pa-
                                                                                                          vilions! Of course, there were excep-
Jerzy Bojanowicz                                                                                          tions, such as the example of Lactima
                                                                                                          from Morąg or the family business
                                                                                                          Polder from Łysomice, although its
Due to Poland’s particular role, a day   heritage, traditional regional products,                         product – kajmak, is known across
before the opening of the trade show     organic food, as well as holiday and                             entire Poland by confectionery pro-
a press conference was held with the     relaxation opportunities (historical                             ducers, but not grocery store clients.
participation of Marek Sawicki, the      buildings and sites, agritourism, active                         Those who presented themselves sep-
Minister Agriculture and Rural Devel-    leisure, etc.). In the pavilion (shared                          arately were: the Organisation of Stur-
opment, who the next day – togeth-       with France) occupied by Polish food                             geon Fish Producers, which said that
er with Ilse Aigner, Federal Minister    producers (in total around 100 exhib-                            “sturgeon is coming back”, Amber –
of Food, Agriculture and Consum-         itors), the exhibitors were visible only                         producer of amber products, but their
er Protection – officially opened the      after walking up to the “counter”,                               stand was situated in such a way that
event. The opening was followed by a     since their products were exhibited on                           I thought that it was a French compa-
reception attended by some 5,000 in-     by 8 regions and – something worthy                              ny and – at the same stand – Consorti-
vited guests.                            of following – there was a joint exposi-                         um: the National Poultry Council, the
    During the ceremony, the Minister    tion of Mazurskie, Podlaskie, Lubelsk-                           Polish Meat Association, the Associa-
said: “In the coming months, we will     ie, Świętokrzyskie and Podkarpackie                              tion of Polish Butchers and Producers
be deciding about the future of Euro-    provinces prepared under the slogan:                             of Processed Meat and Polish Associa-
pean farmers. The outcome of this de-    “Eastern Poland. Macroregion. Mac-                               tion of Beef Cattle Producers. Its own
bate will be immeasurably important      rofuture”. Unfortunately, Mazowieck-                             product were also presented by the
for us all, as consumers. The future     ie, Górny Śląsk and Pomorze provinc-                             Union of Producers and Employers of
of European agriculture will most-       es were not present.                                             Meat Industry, who was an operator of
ly depend on the shape of the Com-           Th is longest trade show in Eu-                              a Polish restaurant. “We want to prove
mon Agricultural Policy, which must      rope is not just a typically business                            that Polish food is of the highest qual-
be simple, transparent and free from     event, but rather a family event – it      Opening Ceremony      ity, that it is worthwhile to buy it, and
historical bygones. A real reform is     is to satisfy the tastes and palates of    International Green   come to us for it, and then encourage
necessary, and not just an apparent      Germans. You can buy almost every          Week Berlin 2011      their friends to buy in Poland,” said
one. The Common Policy must ensure                                                                        Joanna Pietruszewicz, head of the De-
the modernisation and restructuring                                                                       partment of Promotion and Commu-
of agriculture in the EU and – in the                                                                     nication in Minister Sawicki’s Office.
age of advancing liberalisation – an                                                                          Just like several organisations
improvement of its competitiveness                                                                        built a common stand, the Ministry
on the international market. Europe                                                                       of Agriculture and Rural Development
needs an ambitious reform. Let’s not                                                                      shared one with the Polish Informa-
be afraid of it! Agricultural develop-                                                                    tion and Foreign Investment Agency
ment across the entire European Un-                                                                       (presenting the programme “Eastern
ion will improve our competitiveness                                                                      Poland”) and the Poznań Internation-
on the international market.”                                                                             al Fair (MTP), who had a considerable
                                                                                                          part in the Polish exposition.
What is Poland associated with?                                                                               “We have gained exhibitors – re-
Poland was the fair’s partner country                                                                     gions which brought exhibitors, we
for the second time. German media                                                                         were engaged in building the stands:
talked about Polish food products, the                                                                    from the concept to the project, prepa-
country and its regions, which have                                                                       ration of trade publications, as well as,
presented their culinary and cultural                                                                     advertising events on the trade show

12 ::   polish market :: 2/2011
                                                               Agriculture
grounds and beyond”, said Filip Bitner,
director of the MTP Product Bureau.          more of our food can be purchased in
    Agata Lewandowski, author of the         western grocery stores, together with
slogan “Polen Schmeckt”, added: “Th is       the immortal bigos. Polish food can
is not just about promotion at the trade     also be purchased in foreign locations
show. The essence was to take advan-         of grocery chains that are also present
tage of the fact that Poland was a part-     in Poland. During the last 5 years, the
ner country in its promotion, creat-         value of their exports grew by PLN
ing an appropriate image. Th is is why       200-300 million annually (by around
external marketing tools were neces-         20%). At the end of 2009, it amounted
sary, such as posting flyers in Berlin        to PLN 1.8 billion, and during 2010–3
metro stations and running the com-          billion (a 70% growth). Tesco offers
mercial spot in metro cars. The metro        around 400 products from Poland in
is used by 4 million people a day, in-       its Great Britain stores. Polish goods
cluding those who are heading to the         are also exported to several Europe-
trade show.”                                 an countries by Lidl and Kaufl and,
    At the Ministry’s stand, informa-        and to Portugal – by Biedronka. Car-
tion was provided about Polish agri-         refour also exports, to the benefit of
culture and food industry, including         Polish producers, of course.
that from the Discover Great Food from           The flagship products are pâté and
Poland programme and projects real-          carrot juice, dill pickles, herring, salt
ised thanks to EU funds from the Ru-         sticks, apples, tomatoes, Cracow-style
ral Development Programme for 2007-          sausage and vodka. In the UK, Ireland,
2013. Visitors had a chance to taste         Germany and France, they are as much
various foods and take part in crafts        as 30% more expensive than compa-
workshops prepared by the Local Ac-          rable products at home, but consum-
tion Groups.                                 ers appreciate their quality – con-
                                             sider them to be more ecological, for
The stands also hosted folklore              them Poland is an agricultural coun-
groups, while masters of the sauce-          try, smelling of green meadows and
pan and frying pan prepared differ-           clean water.
ent dishes right in front of the visitors.       We have to go with the punch. Take
    It is worthwhile to add that sever-      advantage from the experience of oth-
al companies had their own stands in         ers, since, for example, seafood and
different pavilions. Roaming through          fish were available at national stands,
them, advertisements of products as-         but a Seafood Market was organised
sociated with a specific country caught       in one of the pavilions. There were
the eye. Even so, the Danish stand was       also “proBier Market” and “wines of
dominated by Carlsberg, the Czech –          the world.”
by Staropramen, Irish – by Guinness
(there was also an Irish Pub), Austral-      Not just food
ian – by Foster’s. Belgian truffles were       Grüne Woche is also an opportunity
there, as well as Hungarian peppers          to present a country’s accomplish-
and salami. And what can Poland be           ments in gardening. The Dutch stand
associated with?                             was, of course, dominated by tulips,
    The people that I’ve spoke with          but flowers and various plants were
considered that Poland is associat-          also shown in other pavilons, among
ed with sausage, meat, dill pickles,         others, in the one called the Philhar-
Żubrówka (Bison vodka) and... apples.        monic of Flowers (!). On display were
The Ministry bet on them, and ordered        also gardening tools and chemical.
5,000 apples from Rajpol.                    Present at the fair were also manu-
    Packaged in cartons with suita-          factures of breeding equipment, in-
ble print, they were a free souvenir         cluding aquariums, terrariums, feed
from the Polish stand. In fact, Polish       and accessories for dogs and other
apples are well known, but perhaps           small animals, and also – which sur-
they are not associated with our coun-       prised me somewhat - furniture (and
try to such a great extent. Maybe it is      not only garden furniture) or equip-
worthwhile to invest in an interna-          ment for spa and wellness salons. Man-
tional campaign encouraging people           ufacturers of garden swimming pools,
to come to Poland and pick apples for        sun block fi lters and ultraviolet cabins
themselves?                                  were also at the trade show.
    Seriously: The presence of Poles            One pavilion was occupied by pro-
in different EU countries causes that         ducers of tea, herbs and spices.

                                                       2/2011 :: polish market ::   13
 Agriculture
                                                                                  Cooking equipment was also on               with performances of folklore groups,
                                                                              display. Its manufacturers took up              students and various duos, trios, etc.
                                                                              several pavilions, presenting, for ex-          Their shows were watched by crowds
                                                                              ample, knives made using nanote-                of visitors, the majority of which were
                                                                              chnology. Cooking technology was                middle-aged or elder people. Many
                                                                              an excellent opportunity to present             visitors were carrying various size
                                                                              Polish grinders, mincers, mixers, even          bags with purchased specialities.
                                                                              vacuum cleaners. Unfortunately, none                The trade show is also entertain-
                                                                              of the manufacturers of small house-            ment. The German Federal Ministry
                                                                              hold equipment came. Polish manu-               of Food, Agriculture and Consumer
                                                                              facturers of commercial equipment               Protection (BMELV) organised vari-
                                                                              and machines used in the food indus-            ous shows, pony shows, competition
                                                                              try were not there, while the Czechs            Berlin – Brandenburg in carriage rac-
                                                                              and Hungarians occupied an entire               ing, etc.
                                                                              pavilion!                                           Time will tell if Polish exhibitors
                                                                                  Several pavilions were occupied by          will consider the time spent at Grüne
                                                                              German Länder. Each one obvious-                Woche as productive, although they
                                                                              ly contained a restaurant and a stage           never expected big contracts.         ::




                                                                                                                       confectionery industry, for which it is deliv-
Grüne Woche 2010:                                                                                                      ered in buckets. We also offer it in jars.
                                                                                                                          An interesting proposition for catering is
1632 exhibitors, 1/3 of them from 457 countries (in 2010 r.: 1 589 from 56 countries). The Global Forum for Food and
Agriculture attended by some 50 ministries of agriculture accompanied the trade show. The subject of discussion was    kajmak liqueur as a liquid for fountains, in
“Trade and Global Food Security: Global – Regional – Local”.                                                           which fruits or biscuits can be dipped.
                                                                                                                          We are at the Berlin trade show for the sec-
Jerzy Wierzbicki                                            minimum prices, because business is busi-                  ond time (we have a Polish store in the city).
President of the Management Board of the                    ness. If cheap meat fi nds its way on the mar-              We are planning to appear at trade shows in
Polish Association of Beef Cattle Producers                 ket then we buy it. And as processors, we                  Austria and the Czech Republic, to which we
                                                            also have enormous fi nancial obligations -                 export a small amount of kajmak, as well as
The situation in this industry is not the best              we have to pay back loans taken for the com-               to Ukraine and Lithuania.                     ::
because since the appearance of dioxins in                  pleted investments.
German products, which was simply called                        One should be aware that the tender in-                Rajmund Paczkowski
a disgrace here – the relations between pro-                vitations from large chains lower the quali-               President of the Management Board of
ducers and consumers have been disturbed.                   ty of the product; how can a hot dog be pro-               the National Poultry Council – Chamber of
We have to protect the Polish market and the                duced for PLN 1.80/kg, or pork loin for PLN                Commerce
good reputation of Polish producers and their               6/kg? Maybe, a cheaper substitute is used in-
products, while German companies have in-                   stead of meat, the basic raw material.                     Within the campaign “Meat from Poland,”
troduced a lot of meat at cheap prices. The                     The German government assigned EUR 2                   we are for the fi rst time showing – aside
Polish farmer is losing here because a price                billion to help farmers – in Poland howev-                 from red meats, that is beef and pork –
of PLN 2.80 per kilogram of slaughter weight                er, there are no such possibilities, we have               white meat – poultry. We are also show-
is the lowest since many years. Th is endan-                to fend for ourselves.                      ::             ing that our products meet high quality re-
gers the profitability of production. We are                                                                            quirements, as is attested to by the quality
already hearing that breeders are massively                 (At Massurenallee, in front of the representative          symbols awarded to as: the fi rst recognised
slaughtering herds of breed stock, which is                 entrance, a cavalcade formed of cars and tractors,         Polish meat quality system Quality Meat
an impending crisis. Officially, it is said that              together with trailers, on which transparents were         Programme (QMP), which is a synonym for
we have 13.5–14 million pigs, while the an-                 placed containing the slogans: Small farmers feed          good beef, Pork Quality System – Quality
nual national demand is for 16 million.                     the world, Stop subsidising agro-industry, Stop ge-        Standard and QAFP (Quality Assurance for
    The Minister of Agriculture is right to say             netically-modified food; Genetics: profit for the few        Food Products).
that he cannot react to strictly economic ac-               – risk for all – JB)                                           We are observing huge interest in our
tions since free market is governed by its own                                                                         goose products. Older Germans reminisce
rules. But it is a misunderstanding to com-                 Tadeusz Przymus                                            the Polish goose meat with sentiment. We are
pare Polish farming to German, since our pork               President of the Management Board                          now presenting products from young geese,
farmer delivers an average of 400 units, while              of Polder Sp. z o. o.                                      raised with special technologies such as oat
the German – from several thousand to less                                                                             fed free range, or on grass.
than twenty thousand. A barrier is created for              We produce kajmak, used in Polish cuisine                      The German market receives around 30%
the profitability of the farm and its costs, which           since long ago, but associated with the Orient             of the meat we export, more than 90% of
we cannot limit in the same way as Western                  for the last 10 years. Kitchen recipes prevented           goose meat and a considerable number of
farmers. On top of this, add the incredible                 its production in higher quantities but we                 chicken breast, and also thigh meat. We hope
growth of grain prices during preharvest.                   have worked out the technology to produce                  that the trademarks of quality and safe food
    We are speaking with farmers. We want                   kajmak on an industrial scale and are now                  given to our products will increase interest
to help them but we cannot guarantee higher                 selling it across Poland, especially to the                in Polish food.                            ::

14 ::   polish market :: 2/2011
“Łmeat-Łuków” S.A.
    Meat Processing Plant




•   38 years of experience in meat industry
•   slaughter and cutting of pork and beef, Halal slaughtering
•   tinned meat, pâtés
•   cold meats, sausages
•   pet food

Export licenses for more than 35 countries outside the EU,
including Russia, USA, Japan and Korea.

HACCP-certified integrated food safety system                     Zakłady Mięsne “Łmeat-Łuków” S.A.
in accordance with PN-EN ISO 22000:2006,                             21-400 Łuków, ul. Przemysłowa 15, Poland
                                                                       Tel: +48 25 797 27 19, +48 25 797 27 49
and quality management system in accordance with
                                                                                Fax: +48 25 797 26 83
PN-EN ISO 9001:2001. The certificate of conformity with           aosiak@zmlukow.pl • iskorupska@zmlukow.pl
McDonald’s standards and IFS standards.                                          w w w.zmlukow.pl
 Agriculture



An aware farmer
has solid insurance
Insurance is one of the elements           if no less than 50% of farmed land is
of effectively managing risk, and not       insured from at least one risk factor.
only in agriculture. Thanks to compe-          “It is worthwhile to remember this,
tent management, a farmer can avoid        especially since in 2010 new Europe-
or reduce the effects of certain risks,     an Commission rules came into effect,
while other risks, even if they occur,     which, if the insurance obligation is
will have no impact on the functioning     not fulfi lled, will limit farmers’ ac-
of the farm, since the insurance claim     cess to preferential credit, social wel-
covers the losses that have occurred.      fare, seed subsidies, etc.,” says Andrzej
    Speaking about risks the farmer        Janc, Director of the Agricultural In-
has no control over, they concern ab-      surance Office at Concordia.
normal weather conditions, accidents           Concordia Polska TUW started
and other events, which cannot be          business in 1997 in Poznań. During
foreseen. In this case, possessing solid   a dozen or so years of its existence, it
insurance is indispensable. When the       gained the trust of many clients and
event, covered by the scope of the in-     partners, developed its sales network.
surance occurs, the farmer’s fi nancial     Thanks to many years of experience,
situation does not suffer. He or she can    both of the shareholders and its own
rebuild the farm, renew production,        experience on the insurance market,
buy or repair the farm equipment.          it has taken on the challenge and con-
    The insurance policies most often      tinues to achieve success in the sphere                         them is purchased on credit or on
entered into are for civil liability of    of agricultural insurance, legal protec-    Andrzej Janc,       lease. Insurance is therefore needed
farmers on the count of possessing a       tion, bancassurance, etc., achieving        Director of the     for this reason. Concordia possesses
farm or running a business, insurance      the position of a solid partner.            Agricultural        special insurance in its product line:
of buildings and property existing on          Insurance subsidised by the na-         Insurance Office    Agro-Casco, for agricultural machin-
                                                                                       at Concordia
a farm against fi re and other chance       tional budget is offered by Concor-                              ery, which, depending on the chosen
events, special insurance of agricul-      dia from 2006. “We have a 40% share                             variant, can include in its scope cer-
tural machines and crop insurance.         of the market by insured area,” says                            tain risks or all risks, regardless of the
    In Poland, the area of farmed land     Andrzej Janc. “In 2010, we insured                              operator’s will. Insurance can be ex-
is around 11 million hectares. Crop        1,200,000 hectares. We insure large                             tended for one year or a three month
production is very much exposed to         area farms and also smaller ones, en-                           period.
weather anomalies. For this reason it      terprises and family farms. We spe-                                 As is evident, an aware farmer can,
is worthwhile to have solid insurance.     cialise in insuring against hail, spring                        in this way, secure his or her farm and
    An essential element to farmers’       frost, the negative consequences of                             property, so that damages will not ruin
access to insurance was the introduc-      overwintering and other chance                                  the business, on the contrary, they
tion of the possibility to insure agri-    events.”                                                        will allow him or her to regain fi nan-
cultural crops with premium subsi-             Concordia belongs to companies                              cial balance in a short time, giving fi-
dies realised from the national budget.    winning awards for solid claims han-                            nancial stability and a return to the
Thanks to this, in recent years, around    dling. It grows its permanent network                           state that existed before the damage
3 million ha have been covered by in-      of claims adjusters. “They are quali-                           occurred.                                ::
surance. Prior to the introduction of      fied experts in the agricultural indus-
insurance subsidised from the nation-      try,” claims Andrzej Janc. “In 2010, we
al budget, the insured area was more       signed more than 45,000 crop insur-
than three times smaller than today.       ance agreements. We noted more than
    Insurance sold with government         5,700 claims in agricultural crops, and     An essential element to farmers’ access to insurance was
subsidy is based on the system that half   it was a particular year, as very many      the introduction of the possibility to insure agricultural
the premium is paid by the farmer and      losses occurred, caused by the nega-        crops with premium subsidies realised from the national
half is subsidised by the national budg-   tive effects of overwintering and hail       budget. Thanks to this, in recent years, around 3 million
et. Insurance is mandatory for every       storms.”                                    ha. have been covered by insurance. Prior to the
farmer receiving direct payments to            In recent years, high interest is       introduction of insurance subsidised from the national
agricultural production. The respon-       also noted in insurance of agricul-         budget, the insured area was more than three times
sibility is considered to be fulfi lled,    tural machinery. A good portion of          smaller than today.

16 ::   polish market :: 2/2011
A TRADITION OF QUALITY
      SINCE 1885
 Agriculture



We’re educating professionals
for the Polish economy
Interview with Prof. Alojzy Szymański, Rector of the Warsaw University                                       have the best chance for fi nding a job
                                                                                                             in their study field. The necessity to
of Life Sciences (SGGW)                                                                                      modify programmes at the level of
                                                                                                             higher education is a consequence of
                                                                                                             the time that we are living in. It is a
                                                                                                             reflection of the unprecedented fluc-
                                                                  but also a lifestyle. Th is style is de-   tuation in life conditions, and also
                                                                  fi ned by our students, while the fac-      changing demands placed on grad-
                                                                  ulty gives them the ability to devel-      uates by the job market. The modifi-
                                                                  op and function in a changing world.       cation of the educational programme
                                                                  For this reason, our institution is con-   is also the consequence of constant-
                                                                  stantly changing, adjusting its offer       ly higher expectations from students,
                                                                  to changes on the job market, chang-       who are aware of the fact that, through
                                                                  es in education and economies tak-         broader education, it will be easier for
                                                                  ing place in the contemporary world.       them to adjust to the demands of the
                                                                  Our results testify to the fact that we    job market, to take advantage of ap-
                                                                  are heading in the right direction. We     pearing niches, in terms of compe-
                                                                  are investing in the future.               tencies, and become more attractive
                                                                                                             candidates for employers. We strive
                                                                      In what way is the university ad-      to prepare our students for their fu-
                                                                      justing its educational offer to the    ture professional lives, also in the role
                                                                      demands of the job market?             of young entrepreneurs, confident-
                                                                  Th is is one of our priorities. The uni-   ly undertaking new initiatives, cre-
                                                                  versity is constantly reforming its ed-    ating new jobs – both for themselves
                                                                  ucational programmes through the in-       and for others. The future veterinar-
                                                                  troduction of new forms, levels and        ian, construction engineer, technol-
                                                                  specializations. We are broadening         ogist, sociologist or a certified farmer
                                                                  degree programmes in areas not pre-        should also be equipped in the knowl-
                                                                  viously associated with agriculture.       edge of law, economy and information
                                                                  We are striving for our graduates to       technology. These are unusually useful



    Professor, can it be said that SGGW    Prof. Alojzy
    is a university meeting the needs of   Szymański
    the 22nd century? A university re-
    ally educating for the needs of our
    great-grandchildren?
Today’s SGGW is the effect of the work,
zeal and wisdom of thousands of em-
ployees and 140,000 students. There
are many sources of success and recog-
nition: high quality of education, pro-
fessional staff and a degree recognized
worldwide. The attention paid to each
student, possibility of self-actualiza-
tion by participating in science clubs,
dancing teams, music, sports sections
should be mentioned as well. We help
our students in order to shape their
abilities in many areas.                     View of the Water
    We have a modern campus, ensur-             Centre building
ing a good atmosphere for learning           from the Teaching
                                                       Gardens
and rest. SGGW is not only education,

18 ::   polish market :: 2/2011
                                                       Warszawskie Zakłady Zielarskie „Herbapol” in Pruszków looks back on a
                                                       60-year tradition. Know-how and decades of experience in manufacturing
                                                       preparations from selected herbs allow us to offer effective and safe prod-
                                                       ucts made according to Good Manufacturing Practices.
                                                       In our efforts to meet customer needs in herbal medicine we have devel-
                                                       oped herbal pastes which effectively prevent and cure urinary ailments.
                                                       Herbapol preparations have won wide acclaim among patients who  val-
                                                       ue natural, traditional and healthy treatment.
                                                       We also export our herbal products to countries in Europe and Asia.
                                                       Herbapol has won numerous awards and distinctions at international
                                                       and domestic herbal and pharmaceutical fairs.
100% nature
     Our flagship product is Phytolysin, a preparation used in the treatment of urinary tract infections
     and inflammations as well as nephrolitiasis and urolithiasis.



                                                                                                             Laureate of
                                                                                                             the European Medal




     One of our most recent products are modern diet supplements based on carefully-selected herbal
     compounds produced in keeping with the highest pharmaceutical standards.
     Diet supplements aid basic bodily functions like digestion and sugar management, prevent insomnia,
     cleanse the body of harmful metabolic byproducts and regulate the functioning of the urinary tract.




    Warszawskie Zakłady Zielarskie „Herbapol” Pruszków, ul. Ołówkowa 54, 05-800 Pruszków, tel. +48 22 7381 391; e-mail: eksport@herbapol.waw.pl


    Before use please read the information on the adjoined leaflet for indications, counterindications
      and dosage, or consult your doctor or pharmacist. Improper use of medicinal preparations
                                    can endanger your life or health.
 Agriculture




                                                                                                            Is this the reason why the Warsaw
                                                                                                            University of Life Sciences received
                                                                                                            in 2010 the title of the “Most inno-
                                                                                                            vative and creative university in
                                                                                                            Poland”?
                                                                                                        Th is is, above all, the result of our con-
                                                                                                        stant efforts to modernise the uni-
                                                                                                        versity and to introduce the latest
                                                                                                        technical and information technology
                                                                                                        solutions into teaching and into con-
                                                                                                        tact with students. Universities were
                                                                                                        also evaluated as to the degree that
                                                                                                        they are visible on the Internet. Dur-
qualifications, preparing graduates for          View of the   recreates the natural environment of      ing last year, SGGW launched a multi-
starting up and running businesses,             Laboratory    the river. We can see in what way the     media university website, adjusted to
ensuring knowledge of employment            Building across   water accumulates as well as the plants   the current trends on the net, www.
                                           the plant-based
laws, forms and possibilities of carry-                       that grow along the river. Water is a     sggw.pl, internet television www.
                                               wastewater
ing on business activity, PR, account-     treatment plant
                                                              global problem of the next centuries,     sggw.tv and a dozen or so faculty web-
ing and e-technology. Responding to                           that’s why we’ll be researching it and    sites. Above that, the university has
these signals from the environment in                         learning in what way to store it and      its own profi les on You Tube and net-
which we function, we have consider-                          limit its use. The Water Centre is the    working portals. We are also taking
ably extended our educational offer in                         nation’s largest research centre, deal-   advantage of new teaching technolo-
recent years, introducing many new                            ing with aquatic problems and gath-       gies, among them, education through
educational fields, such as: biotech-                          ering 20 laboratories from different       the Internet, lecture hall equipment,
nology, renewable energy technolo-                            fields. There is also an experimental      we are taking advantage of technol-
gy, land management; environmen-                              field for scientists and students at the   ogies making studying and access to
tal protection; fi nance and banking;           The Palace     Warsaw University of Life Sciences.       knowledge easier. The Warsaw Uni-
management and production engi-                                                                         versity of Life Sciences runs the “Pro-
neering; sociology. These fields are of-                                                                 gramme for modernising education
fered both by existing faculties as well                                                                at SGGW to ensure competitiveness
as organized on an inter-faculty basis.                                                                 and high competence among gradu-
We offer 28 interesting and different                                                                     ates,” with an aim to, among others:
degree programmes.                                                                                      implement and popularize distance
                                                                                                        learning (eAgriculture studies), im-
    SGGW put into operation the Sci-                                                                    prove competencies of academic staff
    ence-Education Centre of the Fac-                                                                   through training, giving graduates
    ulty of Civil and Environmental                                                                     access to training – as well as abroad,
    Engineering, the so called Water                                                                    and supporting students and gradu-
    Centre and plans to build more re-                                                                  ates in actively entering the job mar-
    search and education centres. Is                                                                    ket, including an analysis of the sto-
    this a method for implementing                                                                      ries of our graduates. Creating career
    scientific discoveries into Polish                                                                   prospects for graduates was an impor-
    agriculture?                                                                                        tant element of the evaluation. SGGW
Th is is the very reason why the cen-                                                                   has a Section for Promoting Graduates
tre was built and why we are plan-                                                                      “Agrokadra”, an Academic Business
ning more research & education cen-                                                                     Incubator is also functioning, indi-
tres, among them a Centre for Food                                                                      vidual faculties are actively work-
and Nutrition or Centre of Applied Bi-                                                                  ing together with many businesses in
ology. The Water Centre project was                                                                     the field and students are taking ad-
fi nanced partly by funding from the                                                                     vantage of free training sessions sup-
Operational Programme “Infrastruc-                                                                      porting their steps on the difficult job
ture and Environment.” On an area of                                                                    market. The entire educational proc-
1.5 hectares, a water park was built                                                                    ess is implemented in such a way so as
(model of a river), as well as a science                                                                to train a professional workforce for
& education building. The river model                                                                   the Polish economy.                       ::

20 ::   polish market :: 2/2011
                                                                                                Agriculture



Sweets from “Jedność”
The “Jedność” (Cukiernicza Spółdzielnia Inwalidów “Jedność”) con-
fectionery sheltered-labour cooperative in Grójec, central Poland, has
been renowned on the market for years as a manufacturer of sweets. Its
assortment of products includes hard caramel sweets, milk and water
fondants, powder pastilles and drops.


To meet consumers’ expecta-                                                   overs
                                               Products offered for toffee lovers
tions and rising market demand, the        include “Tofi ko gold” with choco-   oco-
“Jedność” cooperative availed itself of                                        lf
                                           late fi lling that helps prop oneself up
EU funds to acquire a state-of-the-        and “Tofi ko party” fi lled with advo-dvo-
art production line and technology.        caat that gives one that nice sense of
                                                                               se
As a result, many entirely new kinds       warm feeling.
of sweets are now offered by the co-            Most of the packaging is adjust-just-
operative. “Jedność” sweets manufac-                                           ell
                                           ed to individual customers’ as well as
tured with the new technology stand        warehouses’ expectations. The colour l
out from others on the market in that      of the attractive packaging graphic
they are made without human inter-         design is much alike for all “Jedność”
vention. Human labour has been re-         products. “Frutix modern”, “Tofi ko
placed by machines. Electronic dosing      gold” and “Tofiko party” are packed in
of raw materials allows for batch-to-      2 kg cardboard boxes in bulk and lay-
batch accurate repeatability.              ers as well as in 100 g packets. “ Fru-
     “Jedność” offers a rich assortment     tix grand” is packed in 3 kg flapped
of new confectionery products. The         cardboard boxes in bulk and in 100
latest which we recommend is “Fru-         packets. “Frutix musso” and “Frutix
tix modern”. That particular product       minti” caramel candies are packed ined
merits special distinction. It tastes                                         kets.
                                           1 kg bags in bulk and in 100 packets.
superb, has an uncommon shape and              Each of the new “Jedność” prod- rod-
is colour striped. Its mouth-watering      ucts presented above is attractive ctive
juicy fi lling prods reaching for more.                                        f
                                           enough to qualify for the list of Po-
The smashing colour packaging fea-                                              ems.
                                           land’s best selling confectionery items.
turing a jolly fruit orchestra leaves                                         t
                                           We hope that you’ll fi nd at least one
no customer cool. No other compa-          that will meet your taste and whi h
                                                             y              which
ny here has yet offered such a bi-col-      you w delight in.
                                                will                               ::
our delectable chewing sweet stuffed
with juicy fruit fi lling. “Frutix mod-
                                 x
ern” has every chance of becomingcoming
the “hit of the season.”
     We invite customers to try also our
                                 he
hard caramel sweets. Such as the deli-
                                 t
cious “Frutix grand” with fruit fi lling
                                 h
and “Frutix musso” fi lled with pow-
der mousse and enriched with Vita-
                                 h
min C. Sweet-tooth enthusiasts will
                                 sts
no doubt savour the refi ned taste of
these sweets.
     Persons leading an active way of
                                 ix
life are advised to try our “Frutix min-
                                 ate
ti” mint caramels with chocolate fi ll-
                                 nd
ing. Mint makes you feel light and fresh
                                 ick
and chocolate gives you the kick you
need to work.



                                                                                        2/2011 :: polish market ::
                                                                                        2/
                                                                                         /2011                       21
 Agriculture


The road to changing the countryside
leads through hard work
“In transforming rural Poland, the worst thing is pity. The countryside                 is needed is also the return of rural
                                                                                        culture, which has perished, and en-
should be transformed through changes in views and mentality. Farmers                   abling rural areas to experience every-
must know that it is impossible to live off a 10-hectare farm, but we have to            thing that is happening in the cultur-
                                                                                        al sphere. It is obvious that favourable
find another respectable way for them to make a living. There is no other                laws have to be made to support this.
way,” says Prof. Tomasz Borecki, former rector of the Warsaw University                 However, the main problem is that
                                                                                        rural Poland is scattered. We have a
of Life Sciences (SGGW) and present rural and agriculture advisor to the                high number of farms, but only a small
President of Poland.                                                                    number are commercial farms. Small
                                                                                        farms are just a way to survive with-
                                                                                        out having any prospects for chang-
                                                                                        ing one’s fate.

    What are the ways for these chang-      large family-run commercial farms.               Is that the reason behind the mi-
    es to take place?                       On the other hand, we should create              gration of people from rural to ur-
I think that, above all, we should          employment for those who will not                ban areas?
present alternatives. Criticism alone       be working directly in farming. Th is       It is not entirely true that people are
does not lead to anything. For ex-          means the development of the service        escaping from the countryside to the
ample, there are many critics of the        sector, for instance agritourism. This is   cities. Last year was the fi rst one that
Farmers Social Security Fund (KRUS).        not something that can be taken care        people returned from cities to the
Of course, the Fund deserves criticism,     of in one day, by one act of law. Every-    countryside. And maybe that’s how
but what can we replace it with? Ru-        one’s work is required – different types     it will be, since life in the country is
ral areas are inhabited by 40% of the       of organisations, the Church, univer-       more interesting than in larger cit-
Polish population, and 20% are em-          sities and other science institutions,      ies. The country will be a place with
ployed in farming. On the one hand,         politicians, as well as the transfer of     good roads, good access and good liv-
we should be doing everything in or-        knowledge, changing the mentality           ing standards. Th is is all ahead of us.
der to create, in the Polish countryside,   and journalistic programmes. What           There are many misunderstandings,
                                                                                        and even stereotypes regarding the
                                                                                        country and farmers. It is not so that
                                                                                        if somebody is born in the country, she
                                                                                        or he is a farmer. The Polish country-
                                                                                        side should be enriched intellectual-
                                                                                        ly. Th is process is already underway;
                                                                                        during the 20 years of economic trans-
                                                                                        formation in Poland, the country-
                                                                                        side has gained educated people, and
                                                                                        those better prepared for life. Th is is
                                                                                        very important, but a miracle won’t
                                                                                        happen. Nothing will happen with a
                                                                                        magic touch of a wand.




                                                                                        Education and scholarships for the
                                                                                        most talented are really the best
                                                                                        way to achieve changes. Educated
                                                                                        people propagate change by
                                                                                        themselves. And this is what it’s all
                                                                                        about. A bottom-up initiative.

22 ::   polish market :: 2/2011
                                                                                                                              Agriculture

    What can realistically be changed       knowledge to be created, there have
    in the course of 5 years?               to be two sides – the educational and
I think that issues concerning farm-        research institutions and someone,
er social insurance can be resolved. If     who will want to take advantage of this
the Farmers Social Security Fund does       knowledge. It is very difficult to use
not survive then something will take        knowledge having a 2-, 3-, or 10-hec-
its place. I think that it will be pos-     tare farm. At present, only large farm-
sible to ensure better access for rural     ing units, partnerships and organi-
youth to good higher schools, not only      sations, as well as fruit growers, can
those scattered among small towns,          do this because they have the fi nan-
frequently extramural. Education and        cial capability. A recipient of knowl-
scholarships for the most talented are      edge can be a farmer possessing a large
really the best way to achieve chang-       area (50-100 ha), who, besides farm-
es. Educated people propagate change        ing, also processes a part of his or her
by themselves. And this is what it’s all    production. The fact that the poten-
about. A bottom-up initiative. May-         tial of educational institutions is not
be, the process of transforming farms       fully utilised to transform the coun-
and increasing their size will begin –      tryside is a big problem in Poland. We
maybe a law will be passed, that will       are not a stupid nation, but we contin-
enable field consolidation. Maybe a          ue to be organisationally imperfect. A
defi nition of a farm will be adopted.       lot can be done here. The knowledge
Maybe, we will regulate the issues sur-     that is at the universities must reach
rounding land zoning in the country-        the Polish farmer, who should discov-
side. Maybe, the economic model of          er that there is an alternative – that a
“from the field to the table” will de-       possibility for a different meat produc-
velop and will become more visible.         tion exists, that he or she can select to
I hope that innovation and small en-        grow plants that do require a greater
trepreneurship of people who produce        amount of labour, but provide an in-
good products will develop, and that        come, that it is possible to process a
what is produced will not be wast-          product, that there are better pesti-                           are doing fi ne. Today, very few farms
ed. There is no single answer to this       cides, better soil practices. The utili-                        are commercial, most do not produce
question, it is difficult to plan what        sation of knowledge will allow work                             anything for sale. In order to be able to
will happen in a year, and what in          to produce better results. One should                           change this structure, an alternative
two years. Th is should be a process        be flexible. We are already meeting                              way of life must exist. A young person,
that will continue for 20 years. Law        Polish farmers who possess 50-100                               who completes higher education, does
has to be created that will allow log-      hectare family farms and process their                          not necessarily have to want to work
ic in this process, hence, it will regu-    own products. In small farms, hand-                             on the land. He or she can transfer
late issues surrounding farm structure      ing over the product is taking your                             the farm over, of course, on favoura-
and transformation, clarity and ease        job away from yourself. There must                              ble terms, and fi nd employment else-
of starting a business, will enable the     be other work in the countryside. We                            where, where his or her knowledge
creation of better agritourism, better      should create it.                                               can be utilised. Work on the land is
roads, better healthcare and free-up                                                                        not easy. Rural Poland is not rich, life
communication. All this contributes             How will farmers react to the fact                          is hard there. For the sake of all of us,
to the quality of life, and it is its im-       that the best solution will be the                          it is very important that changes to
provement that we’re after.                     pooling of property together?                               the Polish countryside occur with the
                                            Th is is a process that should work from                        most dignity, with as much as we can
    What is the transfer of knowledge       the bottom up. It should be noticed                             afford. The quality of life in Poland is,
    from the university to the coun-        and aided by the Ministry of Agri-                              and will continue to be, considerably
    tryside like?                           culture. Appropriate mechanisms of                              dependent on the future and wealth
We have been talking a lot about this       land transfer should be created. Th is                          of the Polish countryside.
in Poland for a long time. We have not      will not be an easy process, especial-                                  Interview: Sandra Wierzbicka
achieved the type of model that func-       ly in Małopolska and the Lubelskie
tions in the USA, where farms devel-        region, where farms are the smallest.
oped together with universities. Peo-       But this process must be undertak-
ple who were not prepared for farming       en. Farms have to come about that are
became farmers and had to have the          able to exist and compete in the mar-
support of educational institutions.        ket, even with Europe. In Poland, we
They were used to this, while here, this    have worse quality soil and climate         Today, very few farms are commercial, most do not
did not entirely occur that way. There      than that in Western Europe. What           produce anything for sale. In order to be able to change
are centres giving farming advice, but      we have superior, is our hard work          this structure, an alternative way of life must exist.
I think that we can create better con-      and stubbornness. Not everyone would        A young person, who finishes higher education, does not
sultation. In order for a transfer of       make it in these conditions. But Poles      necessarily have to want to work on the land.

                                                                                                                      2/2011 :: polish market ::   23
 Agriculture



Our products are
innovative
                       There is a boom for a healthy and          Ecological Food Fair “Ekogala” – the     quality. Can we already talk about a
                       ecological lifestyle. Across the world,    largest event of its type in Poland.     market for Polish-made organic food
                       trade in organic food, natural cosmet-     The second most important event of       in Poland? In 2006, we did not speak
                       ics and textiles is clearly on the rise.   this type where we are also present is   about any kind of sales. Those were
                       A dynamic development of ecological        “Natura Food” in Łódź. We are learn-     not sales that were worth measur-
                       farming carries many new challenges        ing from the best in the field. We are    ing... At this point we are hammer-
                       with it, which are easier to meet work-    taking an active part in the 23rd edi-   ing at 2% of the total market. We are
                       ing together as part of the Association.   tion of the World Organic Trade Fair     starting to get noticed. Two organic
                       Our idea is to promote and popularise      “Bio-Fach,” taking place on 16-19 Feb-   food producing fi rms made it to the
                       the pro-ecology movement in the food       ruary 2011 in Nuremburg. Th is is the    Warsaw Stock Exchange. There is an
Paweł Krajmas          sector in Poland and the promotion of      largest event in the branch, annual-     interest in the developing food mar-
President of the
                       the Polish ecological products in the      ly gathering thousands of exhibitors     ket, also from investors. We are now
Polish Ecology
                       world. Individual members of Polish        and visitors from around the world.      measurable. And our products are
Association, owner
of “Jasiołka,”         Ecology Association, to which almost       Aside from showcasing our products,      innovative products – they cannot
a producer of          30 entities belong, strive to represent    the fair is always an excellent oppor-   be called anything else. We are sup-
organic food           all the members of the Association         tunity to talk trade, discover new       porting a healthy lifestyle, promot-
                       well in all kinds of events promoting      world trends and to take part in the-    ing Polish food, emphasising ecology.
                       Polish organic food.                       matic seminars.                          We undoubtedly already have strong
                           We present organic food and prod-          Ecological products are defi nitely   brands on the Polish market, char-
                       ucts produced using non-conven-            more caloric and nutritious than the     acterized by an awesome taste and a
                       tional methods at the International        so called conventional food. They are    guarantee of a high quality ecologi-
                                                                  seasoned with spices originating from    cal product.
In our opinion, what Poland needs today is just a large           ecological farms. For example, organ-
promotional campaign for organic food because Polish              ic cold meats are prepared according     In our opinion, what Poland needs
consumer awareness is, unfortunately, still weak.                 to old, sometimes even 150-year old      today is just a large promotional cam-
Education is needed above all else, thanks to which               recipes, frequently coming from near-    paign for organic food because Polish
consumerscan find out what is the diff erence between               by villages. These cold meats are pro-   consumer awareness is, unfortunate-
certified organic food and conventional food.                      duced from fresh meat of the highest     ly, still weak. Education is needed
                                                                                                           above all else, thanks to which con-
                                                                                                           sumers can fi nd out the difference be-
                                                                                                           tween certified organic food and con-
                                                                                                           ventional food.
                                                                                                               Our priority in the new year, in a
                                                                                                           word, is to win the domestic market.
                                                                                                           We simply want to continue to moti-
                                                                                                           vate the purchase of ecological prod-
                                                                                                           ucts and stimulate the Polish market.
                                                                                                           Last year, our Association worked on
                                                                                                           a project of a very large, branch-wide
                                                                                                           promotional campaign. We wanted to
                                                                                                           apply for support under the Rural De-
                                                                                                           velopment Programme, funded by the
                                                                                                           European Union. That project’s budget
                                                                                                           reached PLN 20 million. Today, I have
                                                                                                           to admit that I am disappointed with
                                                                                                           that work as we are not able to fi le the
                                                                                                           project due to procedural reasons. De-
                                                                                                           spite this, we are trying to optimis-
                                                                                                           tically look into the future growth of
                                                                                                           ecological agriculture in Poland. And
                                                                                                           to do what we do.
                                                                                                                                  Maciej Proliński

24 ::   polish market :: 2/2011
AGROL P.P.H. Sp. z o.o. launched its operations in 1996. Our
products are made using specially selected grains of top quality
corn. The company’s core operations are based on its own groats-
processing plant equipped with state-of- the-arts machinery.
Thanks to the first-rate quality of our products and individual se-
rvice offered to our trade partners, we have become the leader
on the Polish market of cereals, rice, groats, peas and beans. We
are also selling fresh fruits and vegetables.
Since 2003, we have enforced the HACCP food safety mana-
gement system which guarantees high quality of products of-
fered for sale.
We are the laureate, among others, of the Export Leader Award
received in 2005 from the Province Business Forum under the
patronage of the Mazowieckie province Chairman. We have also         AGROL
won the Polish Food Producer Certificate.                             Przedsiębiorstwo Produkcyjno-Handlowe
                                                                     Spółka z o.o.
Products offered by AGROL promote                                    09-140 Raciąż, Płocka 53
                                                                     tel.+48 23 679 10 10, +48 23 679 18 55
healthy lifestyle, are widely used in                                tel./fax +48 23 679 11 18
dietetics and support weight loss.                                   www.pph-agrol.com.pl
 Agriculture




The Agri-winners
The Warsaw University of Life Sciences (SGGW) was the site on January 20,
2011 of the New Year Agribusiness Gala. This was organized by the “Agro”
monthly, a magazine designed for enterprising people in the agricultural
and related fields of endeavour. The gala was held to honour individuals
who have scored outstanding success in the rural areas and in the
                                                                                The participants were welcomed
agricultural sector owing to their initiative, enterprise and industriousness   by the SGGW rector Professor Aloj-
in performing their duties and who created models of agri-companies             zy Szymański. Prominent guests at-
                                                                                tending the gala included Secretary
worth emulating by others.                                                      of State in the Ministry of Agricul-
                                                                                ture and Rural Development Kazi-
                                                                                mierz Plocke, Undersecretary of State
                                                                                in the Ministry of Agriculture Ma-
                                                                                rian Zalewski, Secretary of State in
                                                                                the Polish President’s Office Olgierd
                                                                                Dziekoński, President’s adviser for
                                                                                Rural Affairs and Agriculture Profes-
                                                                                sor. Tomasz Borecki, Agri Business
                                                                                Club Chairman Maciej Paradowski and
                                                                                Chairman of the Agricultural Proper-
                                                                                ty Agency Tomasz Nawrocki.
                                                                                    During the official part of the event
                                                                                prizes and awards were presented to
                                                                                the winners of the Agroprzedsiębiorca
                                                                                PR (The Agri-Entrepreneur of Poland)
                                                                                and AgroLiga (AgriLeague) compe-
                                                                                titions, the laureate of the Andrzej
                                                                                Warchoł ABK (AgriBusiness Club)
                                                                                Award as well as to the laureates of the
                                                                                AgroKlasa ODR (Agricultural Adviso-
                                                                                ry Centre) and of the Kwatera na Medal
                                                                                (Top class agri-farm lodging) compe-
                                                                                titions run by the “Agro” magazine.

26 ::   polish market :: 2/2011
                                                                                                                                 Agriculture




   Danuta Grochowska, who won            Sawicki. A Badge of Merit was also pre-      lodging) national competition de-
the title of Promotor Agribiznesu RP     sented to Anna and Ireneusz Plecety,         signed to promote Polish agri-tourist-
2010 (Promoter of Poland’s Agribusi-     proprietors of the Agrohandel Com-           -farms:
ness 2010) in the Agroprzedsiębiorca     pany in Legnica, who are also the na-
competition (and is the mayor of the     tional laureates of the National Agro-       :: Jurajski Folwark Ziebice in the
town and commune of Czerniejewo)         Liga (AgriLeague) award.                        Śląskie province (fi rst place)
received an officer’s sabre and a diplo-
ma. She was also honoured with the       Awards were presented during the             :: “Ela” in the village of Wydmusy in
Badge of Merit for Agriculture awarded   gala to the following winners of the            the Mazowieckie province (second
by the Minister of Agriculture Marek     Kwatera na Medal (Top class agri-farm           place)
                                                                                                                                                          ADVERTISEMENT




Zakłady Mięsne “Dobrosławów” Henryk Amanowicz
meat processing plant – a brand known at home and abroad
                                                       We promote Poland on the international arena. The Association of Polish Butchers and Pro-
                                                       ducers of Processed Meat organized the first in its series of “The European Table – Tradition,
                                                       Modernity, Quality” promotional campaign events on 20–23 April 2010 in Singapore. The
                                                       Dobrosławów company’s management board president Henryk Amanowicz has been active-
                                                       ly involved in the campaign as member of the Association to promote Polish fresh, chilled
                                                       and frozen meat as well as processed meat products abroad with the view of restoring and
                                                       stepping up Polish meat exports not only to neighbouring countries but also to new markets
                                                       where demand is large but yet not fully tapped. Subsequent promotional events took place
                                                       in Shanghai, Bangkok, Moscow and Kiev.
                                                            ZM “Dobrosławów” is one of the few Polish meat processing plants licensed to sell its
                                                       products in the EU and third countries. The company’s main export outlet is eastern Europe
                                                       (Russia, Ukraine, Belarus, Kazakhstan and Estonia in particular). It also exports to Spain, Hol-
                                                       land, Latvia, Lithuania, Moldova, Romania and Sweden. Main export items cover pork half
                                                       carcasses, beef quarters as well as pork and beef cuts.
                                                            While expanding its exports, ZM “Dobrosławów” has also been building up its domestic
                                                       distribution channels. The dynamically growing network of already 50 or so “Dobrosławów”
                                                       warehouses and own stores is mainly situated in the Lublin province in eastern Poland. Man-
                                                       agement board president Henryk Amanowicz attributes the company’s success to its sustain-
                                                       able development. While content with the company’s consistent rise in value, he does not
                                                       rest on his laurels and is investing the profits gained towards the company’s further expansion.
                                                            Over the years, ZM “Dobrosławów” has won numerous awards and distinctions in rec-
                                                       ognition of high product quality and dynamic growth. These include the „Agroliga” (2004),
                                                       “Outstanding Exporter” (2009) and “Leader of the Region” (2010) awards. Moreover, Hen-
                                                       ryk Amanowicz himself received the prestigious distinction for services to agriculture from
                                                       the Minister of Agriculture and Rural Development for his active contribution to the devel-
                                                       opment of Poland’s meat processing industry.
 Agriculture




                                  :: “Brzozowy Gaj” in the village of       play in business was bestowed on Car-
                                     Skoczylasy in the Łódzkie prov-        los Saraiva, vice-president of the Jero-
                                     ince (third place).                    nimo Martins Dystrybucja SA com-
                                                                            pany (owner of the Biedronka retail
                                  Special prizes in the same competition    chain) in which 95% of the products
                                  were presented to Ludmiła and Bo-         sold come from the Polish agricultur-
                                  rys Kozłowki (“Bora-Zdrój” Agritour-      al sector.
                                  ist Farm), Zdzisława and Piotr Denisz-
                                  czuk (Chutor Deniszczuki Agrotourist      The gala event continued with the
                                  Farm), Mariusz and Iwona Berent (Kozia    “Roads to AgriSuccess” debate on the
                                  Baba Agritourism) and Barbara and Jerzy   development opportunities in Polish
                                  Bokiej (“Cichy Dwór” Agritourist Farm).   agriculture. Competition laureates
                                      The Andrzej Warchoł ABK (Agri-        elaborated on their achievements and
                                  Business Club) Award granted for fair     shared their experiences.          ::




28 ::   polish market :: 2/2011
                                                                                                                                           Agriculture



Customers love
tradition and innovation
Interview with Lech Kostecki, president of SuperDrob SA.


    Poland boasts one of the most advanced meat process-                                                              especially in relation to preserving
    ing markets in Europe. What exactly does it take to be                                                            freshness, consumer comfort and aes-
    “number 5” in the market?                                                                                         thetics. Distribution systems are be-
We produce over 70,000 chickens and 5,000 turkeys a day.                                                              ing streamlined. Lately, we have tak-
Our monthly output of cured meat and ready-to-cook prod-                                                              en up several innovative measures in
ucts, including poultry, amounts to 400 tonnes.                                                                       the fi rst links of the production chain.
    All these assortments are delivered mainly to the larg-                                                           Our breeding farms work under strict
est chains of hyper- and supermarkets. 30% of our produc-                                                             rules connected with the wellbeing of
tion is exported to the most demanding European markets                                                               animals. Only plant components are
such as Switzerland and the EU. The countries we sell our                                                             found in our fodders.
meat to include: the UK, Germany, France, Italy, Holland,                                                                 A few years ago we began selling
Sweden, Lithuania, Estonia. Certain eastern markets, like                                                             both roast and ready-to-eat battered
Moldavia and Ukraine, are no less important for the com-                                                              products in Europe. All you need to
pany. The leading chains of hyper- and supermarkets in Po-                                                            is put them in an oven. They are sold
land buy from us, for example: Makro, Carrefour, Auchan,                                                              on aluminium plates, and may surely
POLOmarket, LOT Catering, McDonalds. We sell our pro-                    beef and pork carcasses, we also offer        be called innovative. These products
duce also to hotels, restaurants, shops, and wholesale ven-              delicious smoked meat made accord-           make up tasty ingredients of many
ues. The European KFC network treats us as its main sup-                 ing to traditional recipes. We special-      European dishes.
plier. Last year, we sold the total of 35 tonnes of meat and             ize in the production of ready-made              Let me say it again – SuperDrob has
produce whose value came to PLN 357 million. It’s kind of                smoked meat produce manufactured             been and will be an innovative com-
OK, but I know we can still do better.                                   from poultry, pork and beef. Moreo-          pany.                                 ::
                                                                         ver, we’ve got a rich line of ready-to-
     The recent years saw a dynamic upsurge of SuperDrob                 cook products which belong to the
     exports to Western Europe, in spite of the crisis and sav-          so-called convenience food catego-            For many years, SuperDrob SA has been an
     ings recommended both to household and state budg-                  ry. Th irdly, we are always ready to          active, award-winning exporter, known for
                                                                                                                       shaping Polish exports and building a pos-
     ets. As far as we know, SuperDrob is not into conquer-              take into account individual custom-
                                                                                                                       itive image of Poland abroad. The compa-
     ing markets with low prices. Your products tend to be               er needs, regardless of the size of our       ny has been involved in numerous ventures
     sold from higher shelves.                                           production. What I mean here are both         conducive to its permanent development
It’s no secret. We have been successful, also in foreign mar-            the delivery conditions, i.e. types of        and export growth. The most significant
kets, because of our production standards and product quality            packages, and product features. We            distinctions include:
which we have kept at a very high level for many years now.              adapt them to the specificity of a giv-        :: 2010 – the Association of Polish Export-
                                                                                                                          ers Cup, and an honorary title of the Out-
     Secondly, our product portfolio is unusually vast for a             en country and consumer inclinations.
                                                                                                                          standing Exporter of the Year for an Ex-
producer of this scale. Apart from meat, which is excellent              Sometimes we go as far as to making
                                                                                                                          port Product of the Year (“Turkey or
in regard to its quality and health safety, for instance: poul-          sure that the procedures applicable in           Chicken Breast Joint”).
try carcass, chicken and turkey elements, culinary meats,                case of Halal production are compli-          :: 2010 and 2009 – medals and titles (“Polish
giblets, products resulting from the process of disjointing              ant with the Muslim religious norms.             Exports Leader”) awarded by the Asso-
                                                                                                                          ciation of Polish Exporters for develop-
 SuperDrob SA carries out all its production processes pursuant to           Over the last few years, we’ve been          ment achievements.
 the Good Manufacturing Practice (GMP) and Good Hygienic Prac-                                                         :: 2008 – the company had the honour to
                                                                             observing a marketing and advertis-
 tice (GHP) principles – under the HACCP system implemented in the                                                        be awarded a special distinction by the
                                                                             ing trend to emphasize tradition and         Polish embassy in France for its “Out-
 1990s. SuperDrob SA is a certified manufacturer who observes qual-
                                                                             refer to products and tastes every-          standing Results in Exports to France.”
 ity standards with regard to breeding poultry and producing meat.
 It has been executing its own, integrated programme of feeding and          body remembers from their child-          :: 2007 – the Cup of the President of the
 breeding poultry, called Farm Assurance Scheme SuperPartner IN-             hood - traditional recipes, etc. Is          Agency for Restructuring and Modern-
 TEGRA® which has been approved and supervised by SGS, a glo-                your industry prone to innovations?          ization of Agriculture for SuperDrob SA
 bal leader in verification, testing, and certification of services pro-       What about the company itself?               for outstanding achievements in poul-
 vided in the international agricultural market. Furthermore, it has                                                      try exports.
                                                                         It sure is! Our product line is quite sta-
 been officially certified that we meet quality management require-                                                     :: The Ministry of Agriculture has recent-
                                                                         ble, but it doesn’t mean we have giv-            ly announced that SuperDrob SA is one
 ments based on the BRC Global Standard-Food regulations applica-
                                                                         en up on improvements. We keep in-               of five poultry producers in Poland au-
 ble to companies delivering food under their own brands to hyper-
 markets all over the world.                                             stalling new, more modern machines.              thorized to export its produce to China.
                                                                         Packaging is getting better and better,

                                                                                                                                 2/2011 :: polish market ::       29
 Agriculture



Exporting food
is like exporting health
“Polish exports are on a growth path, food products included. We have a                                  And what creates difficulties and gets
                                                                                                         in our way? Certainly, it is the dis-
rich and differentiated offer, and demand on European markets is returning                                 proportionate, even dissonant sys-
to the pre-crisis level. We can be moderate optimists when looking at the                                tem and legal regulations. As interna-
                                                                                                         tional trade regulations in EU markets
perspective of this year and the coming years”, says Mikołaj Oniszczuk,                                  are close or the same as Polish ones,
member of the General Council of the Association of Polish Exporters, an                                 Eastern markets have way too many of
                                                                                                         them: beginning with customs or phy-
experienced diplomat and economist.                                                                      tosanitary laws and ending with out-
                                                                                                         right bans or quotas. We hear everyday
                                                                                                         about “traffic jams” at border cross-
                                                                                                         ings, including trucks carrying food.

    You have been involved in issues                                                                         For many years you have worked in
    surrounding Polish foregin trade                                                                         Eastern markets. How do you eval-
    for years. Against the background                                                                        uate the export potential to these
    of the current situation, how do                                                                         markets?
    you assess the current state and                                                                     Certainly, I used to work in trade and
    future prospects for Polish agri-                                                                    economy departments of Polish em-
    cultural and exports food?                                                                           bassies, fi rst in Moscow, and most
Several factors determine the position                                                                   recently in Kiev, where I not only
and condition of our exports. These are                                                                  worked to promote the Polish econo-
mainly the product range and demand                                                                      my and cooperation possibilities with
on foreign markets. The relations be-                                                                    Ukraine, but also our food exports.
tween them determine the possibil-                                                                           I will use the latest January data
ity of effective sales, while the re-                                                                     from the Ukrainian market to answer
lations between currency exchange                                                                        this question. The macroeconomic sit-
rates influence the level of prices and                                                                   uation of Ukraine is gradually improv-
transaction profitability. Taking into                                                                    ing, but not in agriculture. The 2010
account these constantly changing el-                                                                    GDP grew by 4.1%, industrial pro-
ements, especially during the present                                                                    duction by 11%, but agricultural pro-
world economic crisis, I can say with                                                                    duction fell by 1%. What is more, the
full responsibility that Polish exports                                                                  output of plant products fell by 4.6%,
are on a “growth path”, food products                                                                    and that of animal products grew by
included.                                                                                                4.5%, with a decline in cattle numbers
                                                                                                         by 1.8%, a slow growth in pig num-
    What factors would you consid-                                                                       bers by 6.1%, and poultry by 5.6%.
    er to be favourable or conducive,                                                                    Th is situation on the supply side and a
    and which would be unfavourable                                                                      growth in demand and retail sales by
    or hindering exports? Which have                                                                     7.8% will cause prices in the current
    already disappeared?                                                                                 year to rise, for example, of meat by
As a rule, in a market economy there is                                                                  an average of 10%. Fruit and vegetable
always lesser or greater risk, and this                                                                  prices will also go up, including ap-
certainly applies to foregin trade as     to Eastern markets, then every signal                          ples imported from Poland, of which
well. Th is is the reason why cautious    on the growth of GDP or consumer de-                           we deliver 250,000 tonnes per year.
actions are needed as early as the de-    mand in Germany, the Czech Repub-
cision-making phase.                      lic, Russia, Ukraine or Kazakhstan is
    Above all an economic improve-        encouraging for our exporters. And
ment in countries which buy our           these are precisely the signals com-
products is the most important fac-       ing from those and other markets right    As a rule, in a market economy there is always lesser or
tor influencing our exports in gener-      now. We must not miss them because        greater risk, and in international trade – certainly there
al. If we send around 80% of our food     the competition is not asleep. Luckily,   is. This is the reason why cautious actions are needed
exports to EU markets and around 10%      Polish exporters are alert and active.    already in the decision-making project phase.

30 ::   polish market :: 2/2011
                                                                                                                                              Agriculture


    There will not be any meaning-              payment for export shipments from                    policy be like in this area, while not
ful reforms in Ukrainian agriculture            certain partners.                                    making it needlessly too “political?”
and trade, although it appears that                 Other Eastern markets can be con-            It is true that, whether we like it or
the moratorium on the sale of land              sidered to be in a similar situation.            not, politics is present everywhere.
will be lifted as of 1 January 2012. The        Th is includes Russia, where there is a          The issue is that it should be a pro-
“Ukrainian Tax Code” will likely be             spur in the economy (GDP growth of               moter of national economic interests.
passed, which may impact small and              3.8%), but there are also attempts to                Our international economic rela-
medium enterprises, and maybe even              put in place limits, use quotas, tran-           tions are shaped by both politics and
cause a deregulation of rules on car-           sit bans and other administrative ac-            the strategy of pro-export develop-
rying business activity in Ukraine.             tions, despite the fact that their own           ment of the economy until at least
    What interests our exporters is the         production meets only 60% of mar-                2015. But the most important thing is
situation in foreign trade. Ukraine             ket demand for meat, and only 40%                that we have very good products, at-
does not have a policy, nor strategy,           when it comes to cheese.                         tractive both in taste and pricewise,
for international economic coopera-                 Nevertheless, I consider Eastern             and professional exporters, for whom
tion. Trade appears to have increased           markets to hold a lot of promise for our         no market is scary. Our position as the
during the prior year, but there is             exports, especially when it comes to             sixth largest producer of food in the
still a very high negative balance for          food and the development of cooper-              European Union is both ennobling
Ukraine: USD 7.9 billion, compared              ative and investment ties in the small           and obliging.
to USD 4.8 billion in 2009. Th is is im-        and mid-sized enterprise sector. Es-                 The majority of our exporters are
portant in the sense that knowing the           pecially since, in Russia and Ukraine,           taking advantage of existing op-
history of practices thus far, it is pos-       this sector is in a growth phase, sup-           potrunities actively and effective-
sible that administrative ambitions             ported by government and regional                ly. Polish food is healthy, however,
to regulate imports “manually” may              authorities. They are interested in our          even knowing this truth, an active and
arise, limiting them under the cover            experience, of which they speak a lot
of protecting the “domestic produc-             at many business meetings.                                Our international economic relations are shaped
er” and reducing the negative bal-                                                                          by both politics and the strategy of pro-export
ance of foreign trade. The country’s                What should be done to best take                       development of the economy until at least 2015.
liquidity will not improve and prob-                advantage of our production and                      And, what’s most important, very good products,
lems may continue with receiving                    export potential? What should the              attractive both in taste and pricewise, and professional
                                                                                                                   exporters, for whom no market is scary.

                                                                                                                                                                    ADVERTISEMENT




NUTRICIA’s excellent team
NUTRICIA Supply Point in Opole is Europe’s largest
producer of infant formulas and baby food certified as
special purpose foods.
In January, the chapter of the “2010      called “Creating the value of the re-
Laurels of Skill and Competence”          gion through workforce development
awarded the employees of NUTRI-           in NUTRICIA Supply Point” which was
CIA with the Platinum Laurel in the       awarded with the “Kapitalni w Opol-
“Excellent team” category. This is an     skiem” title (for best projects car-
award for effective collaboration with     ried out within the framework of
the board in implementing the com-        the EU Human Capital Operation-
pany’s strategic goals. The company       al Programme). “Currently, we are
attaches great importance to its em-      implementing a new system of soft
ployees and the local community. Its      competencies – CODE, whose imple-
activities are based on the philosophy    mentation is related to training of all
that people are the most important        the employees regardless of their po-
factor of a company’s success. Em-        sition in the company,” says Katarzyna    people in need. For many years, with        two years in a row. The company was
ployees have defined career paths,         Rudzińska, HR director at NUTRICIA        great commitment the company has            also awarded with the Forbes Region-
they participate in trainings, projects   Supply Point in Opole. In addition,       been carrying out the corporate Sup-        al CSR Award. “I am deeply convinced
and the implementation of new sys-        employees are actively implementing       porting Life programme, which helps         that the company is people and there-
tems. The company co-finances for-         the WISE safety system, which focus-      many local instittutions. For its activi-   fore I am extremely proud that I work
eign language courses and studies.        es on the development of safe behav-      ty in this area, NUTRICIA won the title     with such a committed, professional
    NUTRICIA carried out a project        iour in both work and private life. The   “Company Well Perceived” bestowed           team,” says Andrzej Drosik, the direc-
co-funded by the European Union           NUTRICIA team does not forget about       on socially responsible corporations        tor of the plant.polish market :: 31
                                                                                                                                      2/2011 ::
 Agriculture


well-organised promotional activity is            promotion in general, and specif-       through contacts with government
necessary. Promotional activity is an             ically in promoting food?               and departmental administration
investment in the future. Maybe it is         Trade and economic agencies of Polish       and regional authorities. They sup-
a paradox but we are better at it in EU       diplomatic service – although opin-         port contacts at the level of small and
countries than in the Eastern markets         ions on this topic differ, have a wealth     medium enterprises.
- something that I know from experi-          of up-to-date and trustworthy infor-            And it is those actions that our food
ence, having worked for five years in          mation about the market in the country      exporters are also able to benefit from.
France. Proof of this is our successful       where they serve. This concerns oppor-      Maybe the cooperation with local mass
promotional performances in, for ex-          tunities and conditions for exports, as     media organisations is weak, in terms
ample, Germany, France or Britain. In         well as contact data for partners inter-    of the promotion of our economic re-
Eastern markets, despite growing ac-          ested in various forms of cooperation.      alities or in advertising Polish com-
tivity, there is still much to be done,           Trade and Investment Promotion          panies, brands and goods. Attention
compared to the activities of other EU        Sections and Economic Sections of           is being paid to this aspect at meet-
competitors. The bare minimum is to           the Embassies of the Republic of Po-        ings with exporters at home, includ-
maintain a constant presence on the           land are working actively and ef-           ing those organised by the Association
market and to foster direct contacts          fectively in Eastern markets. In the        of Polish Exporters. The same con-
with partners. Email, although very           opinion of exporters, importers and         cerns the potential for the promotion
useful in the age of information tech-        investors (as well as mine), their use-     of food with the aid of Polish commu-
nology, is no substitute for meetings         ful role is beyond discussion. They         nities abroad, including, and there is
and face-to-face conversations, espe-         support or directly participate in          progress here, the help of local Polish
cially in Eastern markets.                    business meetings, investment fo-           community press. Economic diploma-
                                              rums, economic missions or in trade         cy is friendly to the business environ-
    What role do Polish trade and             fairs. They promote the Polish econ-        ment; you only have to know how and
    economic agencies, described as           omy, our export potential and other         be willing to make use of its coopera-
    “economic diplomacy,” play in             forms of cooperation, among others          tion and support.                       ::




                        The Association of Polish Export-           regions. Every exporter can take ad-         assessing the trustworthiness of po-
                        ers is an organization representing         vantage of the very useful Internet site     tential partners, the skilful promo-
                        more than 300 Polish exporters from         www.eksporterzy.org, where infor-            tion of own company and products
                        all sectors and regions of our coun-        mation useful in running an export           and making use of fi nancial and in-
                        try. It has been in business since 2002     business can be found. Deserving of          surance instruments. Of considera-
                        supporting its members and export-          particular interest on the site is the       ble meaning are also contests that are
                        ers. What distinguishes the Associa-        published “Pro-export Development            organized – the “Outstanding Ex-
                        tion from other organizations is that it    Strategy of the Polish Economy.” Th is       porter of the Year” and “Outstand-
                        was created on the initiative of busi-      strategy is a programme document,            ing Journalist of the Year.” Members
                        nessmen with the goal of carrying out       comprehensively describing the ba-           are also supported by the Centre of
                        actions concentrated on the specific         sic assumptions, goals and direction         Export Promotion and the Export
                        needs of the exporters’ community.          of the economy’s pro-export policy           Promotion Portal (containing con-
                        The Association undertakes initiatives      in the perspective of several years,         siderable databases of both suppliers
                        promoting Polish exports; it organizes      until 2015.                                  and those seeking certain products),
                        congresses and conferences, enrich-             The Association maintains con-           Polish Market (promoting export-
                        ing the knowledge base and capabili-        tact with more than 5,000 exporters          ers), Polexpo Exhibitions (organising
                        ties of exporters. The overriding goal      from the entire country. The Associ-         trade shows), the Export Credit In-
                        is to improve system solutions, pro-        ation’s forum presents their common          surance Corporation and Bank Gos-
                        mote exports, information and assist        interests, which helps in coordinat-         podarstwa Krajowego. The successful
                        exporters with getting in contact with      ing and striving for optimal system          cooperation with the Ministries of the
                        foreign partners. The most impor-           solutions, favourable to all exporters.      Economy, Agriculture, Foreign Affairs
                        tant current task for the Association                                                    and the Agricultural Market Agency
                        is to act in the interest of improving      The primary goal of the Associ-              is also worthy of mention. Coopera-
                        economic conditions for exporters,          ation is to act for the promotion of         tion with both chambers of the Par-
                        in order to expedite the process of         the development of exports and assist        liament, chairmen and governors of
                        coming out of the economic reces-           exporters in obtaining contacts with         all the regions makes is possible for
                        sion and accelerate the growth of the       suitable foreign businesses. The activ-      the Association of Polish Exporters
                        Polish economy.                             ities of the Association concentrate on      to present the needs of its members
Mieczysław Twaróg
                            The Association of Polish Export-       organizing congresses, conferences,          for the improvement of system solu-
President of the
Management Board        ers encompasses both small, as well         forums and seminars, enriching the           tions, bringing about better condi-
Association of Polish   as medium and large fi rms, with ex-         knowledge and abilities of exporters         tions for companies making products
Exporters               port production in all industries and       in terms of carrying out negotiations,       designated for foregin markets.      ::

32 ::   polish market :: 2/2011
                                                                                                                              Agriculture



The world savours Polish food
Remarks by Wiesław Różański, president of the Union of
Producers and Employers of Meat Industry (UPEMI)




Union of Producers and Employ-                                                                                   other typically-Polish special-
ers of Meat Industry (UPEMI) is an                                                                               ties. These are to be exhibited by
organization founded in 2005 to sup-                                                                             leading Polish companies, includ-
port Polish meat processing compa-                                                                               ing: Brothers Urbanek, Kupiec SA,
nies. Its members are proprietors of                                                                             Milano, Amber Brewery, Potocki
meat processing companies and live-                                                                              Vodka and Agros Nova.
stock breeders as well as members of                                                                                 Right now UPEMI is setting up
organizations affiliating chefs, institu-                                                                          a logistics office in central Shang-
tions supplying meat products to res-                                                                            hai to coordinate the distribution
taurants and eateries, marketing and                                                                             of Polish products throughout Asia
meat industry consultancy groups as                                                                              (and not just in China).
well as chambers of commerce and                                                                                     May I note that consistently
trade. Our prime objective is to pro-                                                                            rising food production in Europe
mote Polish meat products through-                                                                               growing necessitates its exports to
out the world.                                                                                                   third countries. That calls for pro-
     Th ree years ago UPEMI launched                                                                             moting the export goods fi rst. Po-
its ongoing “Table Full of Tastes” cam-                                                                          land’s EU presidency in the second
paign co-fi nanced by the EU and the        a hit among local gourmands. It was        half of this year offers a big opportunity to promote Polish
Agricultural Market Agency. Its pri-       also a hit on the local market and that    food in Europe. Poland’s attendance of the Grüne Woche
mary aim has been to promote Euro-         on a scale not seen before! Ours was in    2011 fair in Berlin was in a way a prelude to the promotion
pean meat and meat products on the         fact the fi rst Polish restaurant in many   campaign scheduled for this year. Together with the Min-
US and South Korean markets high-          years at an EXPO event.                    istry of Agriculture and Rural Development, UPEMI ran
lighting in particular their high qual-        In a follow-up development, UPEMI      a Polish restaurant on the Fair site offering Polish cuisine
ity and exceptional flavour.                and the Foundation for Promotion of        specialties. Visitors flocked into the restaurant to have a
     The “Table Full of Tastes” campaign   Polish Food were invited to put up a       taste of original Polish food. The fact that it was hard to
took us in 2008, 2009 and 2010 to New      Polish Trade and Distribution Cen-         book a table even before noon was clear evidence of how
York to attend the Fancy Food Show. We     tre for Agricultural and Food Prod-        popular it was. The world is savouring Polish food. And
also took part in the Seoul Food & Ho-     ucts in the new, 40 ha-large Xijiao        we have much to offer in that respect.                     (MP)
tel fair held in Korea in 2009 and 2010.   International Agricultural Product
Our products there had been highly         Trade Centre which opened in Shang-
appraised. Visitors flooded us with in-     hai in autumn 2010. Th is is China’s
quiries about Polish products and their    most modern trade centre dealing
availability. One important outcome of     in agricultural products and food. It
the Fair was that business contacts were   will ultimately become a giant trade
made as Polish meat producers met Ko-      and distribution outlet for this kind
rean meat importers, wholesalers, meat     of domestic and foreign products. The
processors as well as shopping centre      Polish Trade and Distribution Cen-
and restaurant suppliers.                  tre in Shanghai will no doubt play an
     Last year UPEMI won a competi-        instrumental role in promoting and
tion organised by the Polish Informa-      distributing Polish food products on
tion and Foreign Investment Agency         the highly absorbent Chinese mar-
(PAIiIZ) to run a Polish restaurant in     ket. Most are yet not known in China.
Shanghai during EXPO. That proved              Polish food companies have been
to be a splendid opportunity to dis-       invited to prepare a permanent,
play the best there is in Polish cui-      200 m2-large centrally located exhi-
sine. Polish pork knuckle (golonka),       bition stand. It is noteworthy that Po-
stuffed cabbage rolls (gołąbki), bigos      land will be the sole European rep-
(stewed dish made of sauerkraut, meat      resentative there. The display will
and cabbage) and beef roulades (zrazy)     feature dairy goods, confectionery
served in the restaurant proved to be      and meat products as well as many

                                                                                                                     2/2011 :: polish market ::   33
 Agriculture



I would like to invite you to the
Polish forests – open to everyone!
Interview with Marian Pigan, Director General of the State Forests


                                                                     State Forests National Forest Holding       ones are frequently located in forest
                                                                     manages almost 80% of Polish forests.       areas. Why? Because there is a sin-
                                                                     They cover an area of 7.6 million hec-      gle owner.
                                                                     tares. We administer almost a third of
                                                                     Poland – a particularly valuable part.          What about the specificity of man-
                                                                     What is more, a part growing system-            agement in this organisation?
                                                                     atically, as thanks to the efforts of for-   Nature is difficult to manage. There
                                                                     est officers the forests in Poland are        is always risk involved. Man tries to
                                                                     expanding! To everyone searching for        somehow take nature into consider-
                                                                     leisure in a forest we recommend tak-       ation but it often gets out of control.
                                                                     ing advantage of our rich benefits for       Th is, for example concerns animals –
                                                                     tourists. We take care of the biologi-      their periodic migration to new lands
                                                                     cal diversity of the forests, and pro-      - and water management. However,
                                                                     tect them from many dangers – nat-          over 25,000 people employed by the
                                                                     ural disasters, insect infestations or      State Forests work daily with com-
                                                                     tree diseases. We also make sure that       mitment for the Polish forests to de-
                                                                     forestry, supplying the market with a       velop. National Forest Holding relies
                                                                     universal ecological resource, which        on self-fi nancing. Forest units work
                                                                     is wood, operates in accordance with        on national, regional and local levels.
                                                                     the rules of sustainable development,       The management model of State For-
                                                                     taking into account all the functions       ests is based on three levels: Director
                                                                     performed by the forests. Th is is con-     General, appointed by the Minister
                                                                     fi rmed, i.e. by the international certif-   of the Environment; Regional Man-
                                                                     icates possessed by the regional man-       agements (17) and Forest Inspector-
                                                                     agements of the State Forests. Come         ates (430). The self-fi nancing of State
                                                                     to the Polish forests – they are open       Forests is possible thanks to the ex-
                                                                     to everyone!                                istence of the so-called forest fund.
                                                                                                                 Forest Inspectorates in good fi nan-
                                                                          Nevertheless, in Polish public de-     cial condition transfer part of their
                                                                          bate there appears from time to        funds there, these later being used
                                                                          time the opinion that State For-       by other units. The fund is also used
                           The United Nations General As-                 ests could be privatised.              to fi nance other enterprises, includ-
                           sembly has declared 2011 the In-          The Polish formula for ownership of         ing national – for example education
                           ternational Year of Forests. Its main     the forests is assessed as good by ex-      or research.
                           slogan is “Celebrating forests for        perts from Poland and the EU. If we
                           people.” State Forests – the biggest      were a society rich enough to be able           How is innovation in the State For-
                           organisation of its kind within the       to afford at this time the privatisation         ests defi ned? I know that you at-
                           European Union, managing forests          of forests, to fly for example to Lithua-        tach great importance to using IT
                           which belong to the State Treasury        nia and have a walk in the forest there,        tools in your work.
                           – follows the content of this mes-        then there would be no problem. How-        Forests for “outsiders” can sometimes
                           sage, and it’s not only to celebrate      ever, our society still has a different      be associated with the image of “a
                           the coming year…                          status. Professor Maciej Żylicz of the      gamekeeper with a pipe” and a shot-
                       Yes, the “Celebrating forests for peo-        University of Warsaw has calculat-          gun. However, that image has noth-
                       ple” is the heart of the matter when it       ed what the non-production value of         ing to do with our modern natural
                       comes to Polish forests. Th is is the re-     the forest in the area of national park     resource management. The implemen-
                       sult of the structure of ownership it-        is. It is much higher than the produc-      tation of the State Forests’ IT System
                       self, as Polish forests are still the prop-   tion one. What else? In Poland, due to      (1992) and the standard of the For-
                       erty of the whole nation. Th is is our        this structure of ownership, invest-        est Digital Map (Leśna Mapa Nume-
                       characteristic feature within the EU.         ments are developing. The national          ryczna) at the forest inspectorate level

34 ::   polish market :: 2/2011
                                                                                                                          Agriculture

(2001) are undoubtedly very impor-         Forests. CKPŚ deals with the absorp-                         limited to companies, and the other
tant stages in the computerisation of      tion and handling of EU funds help-                          half is sold at open Internet auctions.
the State Forests.                         ing potential benefi ciaries. It ac-                          There is also the pool that foresters
    Today, we have 7.5 million ha          cepts applications, assesses them and                        sell in the retail system, for example,
mapped digitally. Thus, we have cur-       then monitors the implementation          Foresters          to local people. Forests are not aware
rent information on the state of for-      of projects.                              particularly       how many companies buying timber
est land. Terrestrial Laser Scanning                                                 enthusiastically   are dealers. We have a market econo-
– a technology of recent years - has           Forest capital is, among others,      invite children    my. If someone has purchased goods
been used for the fi rst time on a large        timber... Over the last two years,    and young          in accordance with all regulations, it
scale in Poland in a research project          timber prices have risen, and en-     people, because    just depends on him/her what he/she
entitled “The Development of Forest            trepreneurs blame State Forests for   they know          intends to do with them.
Inventory Methods Based on the In-             high prices and their auction sale    that soon the
tegration of Data Obtained by Var-             system...                             future of our          How much, do you think, must be
ious Geomatics Techniques,” com-           The timber industry expects us to in-     forests will           changed in the Polish conscious-
missioned by the Faculty of Forestry       crease the provision of raw material by   depend on these        ness to stop treating the forest as
of the Warsaw University of Life Sci-      about 5 million cubic metres, but we      young people.          a reservoir of “all unnecessary
ences (SGGW) by the General Directo-       are not able to do this today. The sec-   Educational            things?”
rate of the State Forests, with the im-    ond issue: for many years the timber      activities         Undoubtedly, the greatest threat to
plementation in the years 2006-2008.       sales system has been very tight in Po-   through the use    the forest is man. We spend about PLN
Every year we spend about PLN 30           land, and yet today we have an all-Eu-    of the Internet    20 million on maintenance of clean-
million on research. We introduce the      ropean market system. Timber can be       are getting        ness in Polish forests and on educa-
latest generation forestry equipment,      imported to Poland, but can it be ex-     more and more      tion. The forest education of society
measuring and monitoring equipment         ported? Th is cannot be blocked. In my    important.         is one of the priorities of State For-
and other working tools that provide       opinion, as many market mechanisms                           ests. Our offer is addressed to chil-
security, speed and effectiveness of        as possible must be implemented in                           dren, young people and adults. All
our actions. Timber from state for-        State Forests. Today, timber is rea-                         of this is aimed at spreading knowl-
ests can be purchased over the In-         sonably cheap in Poland. State For-                          edge about the forest environment
ternet - from the Portal for Forestry      ests sell timber in two ways. Half of                        and sustainable forest management.
and Timber (Portal Leśno-Drzewny)          the approximately 28 million cubic                           Forestry inspectorates have prepared,
and e-drewno (e-wood) application.         metres of raw material goes to tenders                       for example, forest education rooms
Currently, in the process of compu-                                                                     and educational shelters. Each for-
terisation, we are going even deeper,                                                                   estry inspectorate has a developed
because we want to equip all our for-                                                                   “Programme of forest education of
esters with computer hardware.                                                                          society in a forestry inspectorate”.
                                                                                                        Foresters particularly enthusiasti-
    Units of the State Forests carry out                                                                cally invite children and young peo-
    many projects to protect nature,                                                                    ple, because they know that soon
    fi nancially supported by the Eu-                                                                    the future of our forests will depend
    ropean Union. Let’s describe the                                                                    on these young people. Education-
    most important of them.                                                                             al activities through the use of the
One of the projects being implement-                                                                    Internet are getting more and more
ed involves the retention and recla-                                                                    important. We promote ecological
mation of military training grounds.                                                                    knowledge on www.lasy.gov.pl. The
The project, in short called “a small                                                                   real hit has become the vortal “Las
lowland retention,” aims to stop or                                                                     Rysia eRysia”, created in coopera-
slow down water flow within small                                                                        tion with the National Fund for En-
catchment areas, while protecting the                                                                   vironmental Protection and Water
natural forest landscape. Its imple-                                                                    Management (NFOŚiGW). Designed
mentation will also improve water ra-                                                                   from the beginning particularly with
tios, and thus enhance the biological                                                                   a view to ecological and forest edu-
diversity of forest and around forest                                                                   cation, with the use of multimedia
ecosystems. The second project aims                                                                     tools, it brings closer the issues of
at the natural revitalisation of post-                                                                  forest biodiversity and forest man-
military areas, the restoration of their                                                                agement and its impact on the envi-
near-natural vegetation cover, and                                                                      ronment and climate. Cooperation
the protection of the species of fauna                                                                  with local governments is a priori-
and flora living there. Projects carried                                                                 ty for us. We are also open to coop-
out by foresters are implemented by                                                                     eration with non-governmental or-
the Environmental Projects Coordi-                                                                      ganisations.
nation Centre (Centrum Koordynacji
Projektów Środowiskowych (CKPŚ)),                                                                       Thank you for your time
the nationwide establishment of State                                                                                       Maciek Proliński

                                                                                                                 2/2011 :: polish market ::   35
 Mazovia




                                                                  The European Network of Regional Culinary Heritage

                                                                  The European Network of Regional Culinary Heritage con-
                                                                  cept has received considerable interest from many Europe-
Mazovia (the Mazowieckie Voivodeship) is the biggest              an regions which do their best to offer delicious and excep-
                                                                  tional regional food to both locals and tourists. The network
and most populous region in Poland where the biggest              comprises twenty-five European regions with the main ob-
Polish city, namely Warsaw, is located. The city has about        jective to promote regional food composed of local raw ma-
                                                                  terials. Member regions also include a network associat-
1.6 million inhabitants, and together with the adjacent           ing regional food producers, processors, and distributors.
areas – 2.5 million. This makes Warsaw one of the biggest         More information at www.mazovia.pl, the official website
                                                                  of the Mazowieckie province, as well as at www.culinary-
cities in this part of Europe. Mazovia is an agricultural, a      -heritage.com, the official website of the European Network
horticulture and fruit farming region. Mazovia is also a          of Regional Culinary Heritage.

leading producer of vegetables and second biggest among           List of Traditional Products
the grain producers in Poland, also the leader in milk
                                                                  Agricultural products, foodstuffs, and alcoholic drinks
production. Meat production can also be rated among its           whose high quality together with exceptional char-
strengths. There are over 1,000 ecological farms in the           acteristics and properties result from the use of tradi-
                                                                  tional, at least 25-year-old production methods, have
province. Mazovia is a region that is attractive for investors,   a chance to be included in the List of Traditional Prod-
strategic for manufacturing and service activities. Mazovia       ucts. The List, maintained by the Minister of Agriculture
                                                                  and Rural Development, includes descriptions of prod-
is a good idea for a weekend as well as a place for doing         ucts that are the inheritance of culinary heritage. Maz-
business. It also offers a chance to meet the fascinating          ovia has already registered 34 such products. More in-
                                                                  formation is available at www.mazovia.pl, as well as at
Polish culture and taste some of the specialties of Polish        www.minrol.gov.pl, the official website of the Ministry of
cuisine.                                                          Agriculture and Rural Development.




Kurpie honey
Applicant: Kurpiowsko-Mazowiecki
Związek Pszczelarzy w Ostrołęce
(Kurpie and Mazovia Beekeepers’
Association)

www.miodkurpiowski.pl

Kurpie honey is nectar-based hon-
ey with possible addition of honey-
dew, made from the nectar of a range
of melliferous plants that blossom for
a long time. The European Commis-
sion has appreciated the uniqueness
of Kurpie honey. The honey has been
registered in the European Union as
a Protected Geographical Indication.




36 ::   polish market :: 2/2011
                                                                                                                                                              Mazovia


Culinary Heritage Network Mazovia Members:

Restaurants and Inns
1. Galeria Smaków „Jaza” Janina
   Zalewska, ul. Nowoursynowska 159,
   02-776 Warszawa
2. Pazibroda Inn, Chrzanowo 2,
   06-200 Maków Mazowiecki
3. Pohulanka Inn, ul. Narutowicza 64,
   Sierpc
4. Restaurant “Chata Smaku”, Rybitwy
   Zamoście, 09-105 Dziektarzewo
5. “Pojednanie“ – the Polish–Jewish
   Restaurant, Dobrołęka 38,
   07-415 Olszewo Borki
6. Restaurant “Zaścianek Polski”,
   ul. Asłanowicza 17, 08-110 Siedlce
Sales
7. “Healthy Food” shop
Production and Processing
8. Ewa and Peter Stratenwerth’s Bio-
                                                                                                33
    bakery “W Grzybowskiej Arce”,                                                          32                                                 34

    Grzybów 1, 09-533 Słubice                                                         31

9. Ciechan Brewery, ul. Kilińskiego 8,
    06-400 Ciechanów
10. Konstancin Brewery, Obory 11 a,
    05-520 Konstancin Jeziorna
11. Dariusz Marcinowski, ul. Topolowa 3,
    96-332 Radziwiłłów
12. „Eko-Fruit Sp. z o.o.”, ul. Gałachy 62,   28. Secpol Sp. z o.o., ul. Okólna 59,
    05-170 Zakroczym                              05-270 Marki
13. EKO-MEGA Watermills Ltd., Tokary 9,       29. Wieczorek’s Vineyard, Borek 56,
    08-108 Korczew                                26-920 Gniewoszów
14. Organic Vegetable and Herb
    Farm„Bukiet Smaków”,
    ul. Grzybowa 36, 05-831 Rozalin           List of Traditional Products
15. Baranków Elżbieta and Ryszard             1. Cabbage with linseed oil and
    Baranek’s organic farm,                       mushrooms, ul. 05-250 Radzymin,
    Łukówiec 105, 05-317 Jeruzal                  ul. Weteranów 82
16. Henryka and Stanisław Myszka’s            2. “Szlachcice” – Polish dumplings
    fruit farm, ul. Kolonia 16,                   with potatoes, Brzeźnik 2a,
    06-425 Karniewo                               07-111 Wierzbno                               12. Kurpie tenderloin,
17. „Jaza” Galeria Smaków Janusz              3. Szydłowiec blood sausage with                      Lutobrok 3, 07-214 Pniewo
    Zalewski, ul. Truskawiecka 14,                diced liver, ul. Słoneczna 18,                13. Dried smoked tenderloins,
    02-929 Warszawa                               26-500 Szydłowiec                                 Lutobrok 3, 07-214 Pniewo             25. Fafernuchy cookies, Lemany 12,
18. „Koneser”, ul. Gen. Kazimierza            4. Dry juniper-smoked sausage,                    14. Skołatowo fatback – hunter’s              07-214 Zatory
    Pułaskiego 12, 07-202 Wyszków                 Hołowiecki 66b, 08-331 Sabnie                     delicacy, Skołatowo 4,                26. Pańska Skórka
19. Kurpie and Mazovia Beekeepers’            5. Ojcowa sausage from Sobienie                       09-164 Dzierzążnia                    27. Sójka mazowiecka dumplings,
    Association, ul. Sienkiewicza 28,             Jeziory, ul. Duży Rynek 9,                    15. Kurpie honey, ul. Sienkiewicza 28,        Podciernie 66, 05-319 Cegłów
    07-410 Ostrołęka                              08-443 Sobienie Jeziory                           07-410 Ostrołęka                          ul. Polna 62, 05-311 Olesin
20. District Dairy Cooperative In Grodzisk    6. Old Polish sausage from                        16. Nadbużański honey, Skrzeszew 76,      28. Guineafowl eggs from Grabina
    Mazowiecki, ul. Traugutta 5,                  Szydłowiec, ul. Słoneczna 18,                     08-307 Repki                              Radziwiłłowska, ul. Duża 45,
    05-825 Grodzisk Mazowiecki                    26-500 Szydłowiec                             17. Mazovian honey beer, ul. Polna 2,         Grabina Radziwiłłowska
21. District Dairy Cooperative                7. Roasted sausage from Szydłowiec,                   07-110 Grębków                        29. Eggs from Radziwiłłów,
    In Wyszków, ul. Okrzei 17,                    ul. Słoneczna 18, 26-500 Szydłowiec           18. Zakroczym cherry liqueur,                 ul. Topolowa 3, 96-332 Radziwiłłów
    07-200 Wyszków                            8. Kogutki from Radziwiłłów                           Gałachy 62, 05-170 Zakroczym          30. Radziwiłłów pasta, ul. Topolowa 3,
22. Nadbużańska Apiary, Skrzeszew 76,             (carcasses of ”green-legged                   19. Beer from Ciechanów,                      96-332 Radziwiłłów
    08-307 Repki                                  partridge” hens), ul. Topolowa 3,                 ul. Kilińskiego 8, 06-400 Ciechanów   31. Snail form Radziwiłłów,
23. “Pachniczówka” Apiary, ul. Polna 2,           96-332 Radziwiłłów,                           20. Grójec apples, ul. Piłsudskiego 59,       ul. Topolowa 3, Grabina
    07-110 Grębków                            9. Pasztet domowy (home-made pâté)                    05-600 Grójec                             Radziwiłłowska 43
24. Serafin Kurpie Bakery, Serafin 4,               from Szydłowiec, ul. Słoneczna 18,            21. Zakroczym cherry preserve,            32. Bolimowski gołąb nadworny ryś
    07-437 Łyse                                   26-500 Szydłowiec                                 Gałachy 62, 05-170 Zakroczym              (roasted pigeon), ul. Topolowa 3,
25. Radzikowscy Town Hall Bakery,             10. Pasztet (pâté) from Sobienie Jeziory,         22. Zakroczymskie “tipsy” cherries,           96-332 Radziwiłłów
    ul. Piłsudskiego 12, 08-110 Siedlce           ul. Duży Rynek 9, 08-443 Sobienie                 Gałachy 62, 05-170 Zakroczym          33. Kapłon staropolski (young chickens
26. P.P.U.H. „Stelmański”, ul. Bema 27,           Jeziory                                       23. Baba cake from rye bread, Kąty 57,        meat), ul. Topolowa 3,
    09-200 Sierpc                             11. Guineafowl from Grabina                           96-500 Sochaczew                          96-332 Radziwiłłów
27. P.P.U.U.H „Bekon”, ul. Słoneczna 18,          Radziwiłłowska, ul. Topolowa 3,               24. Radziwiłłów wholemeal bread,          34. Latowicki garlic, Strachomin 68,
    26-500 Szydłowiec                             96-332 Radziwiłłów                                ul. Topolowa 3, 96-332 Radziwiłłów        05-334 Latowicz


                                                                                                                                              2/2011 :: polish market ::     37
 Mazovia


A well-managed commune                                                                                   ha have been allocated, has practical-
                                                                                                         ly been bought up. Entities that func-
                                                                                                         tion there include, companies from
                                                                                                         the automotive sector, such as Carpol
                                                                                                         (they modernise and reconstruct cars,
“The recognition of implementing institutions stems from the work of                                     adapting them to specific needs, i.e.
                                                                                                         of the police or emergency services),
competent employees who prepare successful applications,” Grzegorz                                       or the PSA concern (producing com-
Benedykciński, Mayor of Grodzisk Mazowiecki, European of the Year                                        ponents for Citroen and Peugeot cars).
                                                                                                             At the moment, we especially
2006 in the category City and Commune Manager and the winner of the                                      count on computer and IT compa-
Mayor of 2009 and 2010 title, tells Jerzy Bojanowicz.                                                    nies, and accounting services centres,
                                                                                                         as we are planning to build an Innova-
                                                                                                         tion Centre – a place where the most
                                                                                                         talented Poles would have a chance to
                                                                                                         progress. For 3 years we will be cover-
    What do you have to do to gain 70% support and be                                                    ing the costs of office lease and serv-
    elected for a 5th term of office?                                                                      ices, and we will provide know-how
You have to turn up at work early and leave late, and make                                               in terms of IT. Preparing the entre-
the best possible use of the time in between. Have good                                                  preneurship incubator and its infra-
contact with people and act properly. I like people, I talk                                              structure, in collaboration with the
with them a lot and our mutual cooperation is perfect. Th is                                             Agency for the Development of Maz-
has been confi rmed by the awards won by our commune:                                                     ovian Region and the Warsaw Univer-
the title of The Best Polish City Commune in 2009 in the                                                 sity of Technology, will cost about PLN
“Rzeczpospolita” daily ranking of local-government au-                                                   35 million. Naturally, I hope that this
thorities, a golden statuette for Entrepreneurship-Friend-                                               initiative will also obtain EU funding.
ly Local Government in 2009 and 2010, and fi nally the title                                                  I might add that during the 3rd IP
of the Mazovian Commune of the Year 2009.                                                                Management Forum – the Internation-
                                                                                                         al Forum on the Management of Intel-
    How does your town manage to acquire new funds from                                                  lectual Property, held in March 2010
    the EU, i.e. for the modernisation of the town’s market                                              in Warsaw, the commune of Grodzisk
    place?                                                                                               Mazowiecki – as the only one in Po-
Brussels is fond of interesting applications. And this ap-                                               land – was awarded a special distinc-
plication covers the modernisation of the town’s market                                                  tion for innovativeness: “Award of Ex-
place, including the construction of a car park, roofi ng, a        It is worth emphasising that after    cellence in IP.”
large shopping pavilion, the reconstruction of the street      the 3-year modernisation of the sew-
near the market, and the preparation of new pavement for       age treatment plant for PLN 95 mil-           Your immediate plans?
the market itself. The cost of modernisation has been es-      lion (of which over 44 million came       Soon PKP national railway will start the
timated at nearly PLN 13 million, of which 10 million has      from EU subsidies), this facility not     construction of a tunnel under the rail-
been granted by the EU.                                        only serves the commune of Grodzisk       way line, as a safe connection between
    There are 800 people in one way or another connect-        Mazowiecki, but also Milanówek,           two parts of the town, long awaited
ed with the market. They sell their products twice a week,     Brwinów, and Podkowa Leśna. Cur-          by the residents. Towards the end of
standing in the open air. I must confess, I am very pleased    rently, 78% of the commune is con-        this year, a tender will be announced
our project has received funding, because it will allow        nected to the sewer system, and with-     for the town’s western ring road join-
considerable improvement in the working conditions of          out the newly-developed areas, the        ing the motorway with the southern
these people.                                                  number of which is constantly in-         part of the commune. In September a
                                                               creasing (in 2010 the town and the        new kindergarten for 300 children will
    Th is is yet another project, for the implementation of    commune gained 700 residents), this       be opened, followed by the end of the
    which the commune has acquired funds from the EU.          would amount to 90%.                      modernisation of the market.
True. We have been granted fi nancial support from the Co-
hesion Fund for the project entitled “Water-sewage man-           In your opinion, will the A2 mo-           And until the end of your term of
agement in Grodzisk Mazowiecki” completed last year,              torway affect the commune’s de-             office?
the construction of a modern community centre and of              velopment?                             I hope for Grodzisk Mazowiecki to be-
the roads in the industrial zone, as well as the restoration   Of course – reaching the centre of        come a nice-looking town, with beau-
of Skarbeks’ Park, the area of Golian’s Ponds, and the his-    Warsaw will take less than half an        tiful buildings and new facilities. We
toric Radogoszcz Villa. We have also obtained resources for    hour. That is why for 2 years now we      are considering the construction of a
the project “Access to the Internet at home”, within which     have been striving to make the motor-     sports and entertainment arena, for
100 people received computers with free-of-charge access       way within the Warsaw metropolitan        which we will probably be granted
to the global network, whereas the European Social Fund        area toll free.                           funds from the EU, and the restora-
has supported the so-called “soft projects,” mainly train-        The entire area of the industrial      tion of the land in front of the histor-
ing and courses. All in all, the funding we have obtained      zone located near the planned exit from   ic train station, which we are likely to
amounts to nearly PLN 100 million.                             the motorway, for which some 1000         take over.                             ::

38 ::   polish market :: 2/2011
WARSAW TRAMS
F R I E N D LY A N D FA S T
         kapitał, tradycja
 polskicapital, tradition
Polish kapitał, tradycja
 polski nowoczesność
      i
     and modernity
      i nowoczesność




                                                     MAZOWIECKI BANK REGIONALNY S.A.
                                                     AND ASSOCIATED BANK SPÓŁDZIELCZY
                                                            CO-OPERATIVE BANKS




                      MAZOWIECKI BANK REGIONALNY S.A. HEAD OFFICE
ul. Elbląska 15/17, 01-747 Warsaw, Poland. Phone: (+48) 22 56 00 400; Fax: (+48) 22 56 00 528
            e-mail: mrbank@mrbank.com.pl; www.mrbank.com.pl; SWIFT: MBREPLPW
                                                                                                                                   Tourism



Imagine Poland...
                                                                                                           Tomasz BagiŃski:

                                                                                                           The campaign “Move Your Imagina-
                                                                                                           tion” will show Poland through ani-
                                                                                                           mation, contemporary dance, inter-
                                                                                                           active games not in “the traditional”
“Move Your Imagination” is the slogan with which the Polish Tourist                                        way as it is often the case with such
                                                                                                           events. Poland in our presentation is
Organization (POT) will promote Poland in the coming years. The slogan                                     going to be crazy, colourful, young
will debut at the ITB Travel Trade Show in Berlin held from 8 to 13                                        and innovative. From the very be-
                                                                                                           ginning since I have heard about this
March 2011. President of the Polish Tourist Organization Rafał Szmytke,                                    event, I knew that we need to have
Under-Secretary of State in the Ministry of Sport and Tourism Katarzyna                                    a slightly different approach to this
                                                                                                           topic. If we really do want to be re-
Sobierajska and Tomasz Bagiński of Platige Image, the architect of Poland’s                                membered at such an event as ITB,
promotional campaign for the Fair, discuss the promotion details.                                          we have to show Poland in an uncon-
                                                                                                           ventional, attractive way, in a way it
                                                                                                           has not been done before. Five crea-
                                                                                                           tures - each marked with the next let-
                                                                                                           ter of the word “Polen” will be the di-
                    Rafał Szmytke:                              Katarzyna                                  rect visualization of our project, along
                                                                Sobierajska:                               with a white cube - an interactive
                    We have been waiting for a very long                                                   toy, through which each of the guests
                    time for this moment to happen. Po-         The ITB in Berlin                          will have an impact on what infor-
                    land has started its biggest promotion-     is the largest and                         mation about our country appears on
                    al campaign. It will be introduced at       most prestigious                           the screen. Why such an idea? Poland
                    the largest event for tourism industry      event for the tour-                        does not have clear and modern na-
                    in the world - the International Trav-      ism industry. The                          tional graphic symbols. Thus, Platige
                    el Trade Show in Berlin. The aim of our     events are held almost all over Ber-       Image has created a completely new
                    campaign is to present Poland as an         lin thus giving a special opportunity      image campaign. We want to change
original and fascinating country, the country with lots         to promote our country in Germany.         the traditional thinking about Poland
of unique tourist attractions. A creative, intriguing and       The status of the partner country is an    as a country of “folk dances and fake-
classy country, which is not afraid to use modern techno-       occasion for Poland to use the organ-      folk souvenirs” or “a country of mar-
logical solutions. The participation of tourism represent-      izer’s entire marketing platform. Th is    tyrdom.” Therefore, there is no white
atives from some 200 countries in ITB will guarantee Po-        means that we will be present in all       eagle on red background. Nowadays,
land is presented to a vast audience. And Poland will do it     promotional actions connected with         this kind of approach is the only thing
in a way that no one has ever done before. Main themes of       this event. Here, Poland is going to       that can give Poland the opportunity
the promotional campaign are Poland’s variety, creativi-        show a diverse and attractive tourist      to appear in the world. Maybe, even
ty and modernity. Poland will officially launch the cam-          offer. Let us keep in mind that Polish      inspire other countries. All promo-
paign as ITB Berlin’s Partner Country. In addition to its na-   presidency in the EU and the Euro 2012     tional fi lms will be recorded in ster-
tional stand in Hall 15, Poland will be represented in more     football championship will be assessed     eoscopic technology. Depending on
than 750 locations of the show and other places in Berlin.      also through the quality of our tour-      the subject, their style will vary. We
Coaches and trains running to the show will be special-         ist offer. By attending the ITB Travel      only want to make varied, dynamic
ly marked, with the information that the partner country        Trade Show we would like to under-         and spectacular spots. Most of them
arrives. The programme will feature Days of Polish Cuisine      line the fact that the next two years in   have been already made - a crazy spot
and the presentation of the Industrial Monuments Routes         Europe belong to Poland! Such events       in the style of a graphic cartoon strip,
of the Silesian region. Our country will also be organiz-       as ITB enable to show what new has         and a very painterly and poetic spot
ing a grand opening show on 8 March with the participa-         happened in our country regarding          showing Poland “from the sea to the
tion of about 4,000 guests. We want to broaden people’s         tourism products and tourism infra-        mountains.” Platige Image has also
imagination in an innovative way, and get them interested       structure (i.e. the construction of sta-   produced an etude on EURO 2012 in
in Poland. A lot of modern technologies will be applied to      diums for the fi nals, the construction     the form of thrilling sports advertise-
achieve this aim. Our country will be promoted through          of motorways and express roads, the        ments, a “crazy”, creative fi lm about
“urban toys”, as well as through fi lms on tourism, culture,     general construction and moderni-          our culture, as well as a large dance
nature and Euro 2012. The punch line of the show will be        zation of tourist infrastructure such      presentation based on the theme of
the dance performance by the fi nalists of “You Can Dance”,      as hotel accommodation). Therefore,        changing seasons, where an equally
choreographed by Agustin Egurrola, together with three-         it seems that the show is a great place    important role as dance will be played
dimensional graphic projection reflecting and multiply-          to start our several years’ long cam-      by a huge screen and 3D animation.
ing their movements. All in 3D, but in different styles and      paign. In Berlin, we really want to        We want to make tourists and people
conventions. It is only the prelude to a campaign of many       present Poland the best we can, and        from the industry wonder: “How is it
years, promoting Polish tourist assets in which some of         in a very comprehensive way, basing        possible that we have not yet visited
the elements that had been prepared for ITB Berlin 2011         on modern media showing its chang-         such a fascinating country?”
will also be used.                                              es and development.                                                            (MP)

                                                                                                                     2/2011 :: polish market ::   41
 Tourism


Incoming tourism to Poland                                                                                          considerable group of tourists are also
                                                                                                                    those from Great Britain (8.8%), Ita-
                                                                                                                    ly (4.7%), France (4.5%), Russia (4.1%)
                                                                                                                    and the USA (3.7%).
On the basis of research by the Institute of Tourism, the structure of arrivals                                          A decline in the number of tour-
                                                                                                                    ists was noted in 2009 in almost all the
to Poland has been assessed in terms of the primary purpose for visiting                                            key countries visiting Poland. A decline
the country. The basic motivations for travelling to Poland are business                                            of British tourists was noted (-17.2%),
                                                                                                                    while there had been a growth in their
travel (27%) and standard tourism (25%). The Institute of Tourism’s forecast                                        number since 2004. However, arrivals
for the structure of arrivals up to 2013 does not predict any substantial                                           of tourists from Germany and France
                                                                                                                    have been declining from year to year
changes to the arrivals structure in terms of the main purpose for visiting .                                       since 2005.
                                                                                                                         The group of few countries from
                                                                                                                    which the number of visiting tour-
                                                                                                                    ists grew includes: Slovakia, Canada,
                        The number of foreigners visit-                 majority of them are from European          Greece, Turkey, Slovenia, India, Hong
                        ing Poland in 2009 was 53.8 million,            countries. Little over 1% are guests from   Kong and Luxembourg, while these are
                        10.2% less than in 2008. The majority           beyond Europe.                              countries whose share of total tourist
                        of arrivals (78%) were single-day vis-              The inhabitants of Germany, Czech       traffic is small, less than 1%.
                        its, without an overnight stay in Po-           Republic, Slovakia, Ukraine and Bela-            Provinces that sold the highest
                        land. Tourists comprised 22% of vis-            rus have the largest share ist total ar-    numbers of overnight stays to for-
                        iting foreigners, and their number in           rivals in Poland. It should be noted that   eign tourist in 2009 are: Małopolskie
                        2009 was 11.9 million, an 8.3% de-              the number of visitors from beyond          (22.2%), Mazowieckie (19%), Zachod-
                        crease compared to the previous year.           the eastern border (Ukraine and Be-         niopomorskie (11,9%) and Dolnośląskie
                                                                                                                    (10,2%).
                                                                                                                         On the basis of data regarding the
                         2004            2005      2006        2007           2008         2009      2009/2008
                                                                                                                    utilisation of hotel establishments in
Arrivals, made up of     61 918      64 606       65 115      66 208         59 935       53 840       -10.2%       the largest Polish cities, it can be noted
Tourists                 14 290      15 200       15 670      14 975         12 960       11 980        -8.3%       that the most frequently visited cities in
                                                                                                                    2009 were Warsaw and Cracow. War-
Other visitors           47 628      49 406       49 445       51 233        46 975       41 950       -10.7%
                                                                                                                    saw was visited by the highest number
                                                                                                                    of tourists, however, Cracow sold more
Number of foreigner     According to the Institute of Tourism’s         larus) grew in 2009, following a con-       overnight stays, which indicates that
arrivals to Poland      forecast, the average rate of change            siderable decline in 2008, mainly the       the average length of stay in Warsaw
during 2004–2009        of tourist arrivals to Poland to 2013           result of Poland’s entry into the Schen-    was shorter. This undoubtedly is relat-
(in thousands)
                        will be 2.9%. The forecast for 2010 as-         gen Area. Also, the number of guests        ed to a higher number of short business
Source: UNWTO data      sumes a growth of tourist arrivals to           from Czech Republic (+4.6%), Slova-         trips to Warsaw.
                        the level of 12.3 million, and a gradual        kia (+34.8%), Lithuania (+36.8%), and            Incoming tourism to Poland is char-
                        growth in the following years to 13.3           Austria (+1.6%) increased. At the same      acterised by high seasonality. Most vis-
                        million by 2013.                                time, the number of visitors from Ger-      its occur during vacation months – July,
                            As far as the origin of tourists that       many (-24.7%), Russia (-6.2%), Great        August and September, while tour-
                        come to Poland is concerned, a great            Britain (-9.9%), Latvia (-27.8%), Hol-      ist traffic during the winter months is
                                                                        land (-5.6%), Italy (-7.3%), USA (-14.8%)   considerably weaker.
  Foreigner arrivals                                                    and Hungary (-11.8%) fell.                       For German tourists, the peak ar-
                                                     2009
   to Poland during                                                         On the basis of data from the Cen-      rival season is observed in July (146 453
                        Germany                     26 070
         2007–2009                                                      tral Statistical Office on the number of      tourists in 2009) and August (157 751),
                        Czech Republic               8 180
      (in thousands)                                                    foreign tourists using collective acco-     however the number of British tour-
  Source: data from     Slovakia                     5 040
                                                                        modation establishments, a fall can be      ists remains at a high level from May to
     the Institute of   Ukraine                      3 820
                                                                        observed in both the number of foreign      October – the number of tourists then
             Tourism    Belarus                      2 360
                                                                        tourists and lodging services rendered      ranged from 33 199 in May to 35 391 in
                        Lithuania                    2 640
                                                                        in the last 3 years.                        September). In the case of French tour-
                        Russia                       1 210
                                                                            In 2009, 3.7 million foreign tourists   ists, similar as for Germans, a consid-
                        Latvia                         390
                                                                        took advantage of collective accomo-        erable increase in arrivals is observed
                        Holland                        335
                                                                        dation establishments, 9.5% less than       in July (23 690) and August (24 530).
                        Austria                        325
                                                                        in the previous year. The number of              This material is a fragment of the re-
                        Italy                          255
                                                                        overnight stays sold to foreign tourists    port “Communications Strategy on the
                        USA                            230
                                                                        amounted to 9.6 million in 2009, 5.5%       British, German and French Markets.”
                        Hungary                        225
                                                                        less than in the previous year.
                        France                         240
                                                                            Germany has the largest share in the
                        Remaining countries          2 020                                                          Diagnosis and quality study report
                                                                        use of collective accomodation estab-       commissioned by the Polish Tourism
                        TOTAL                       53 840
                                                                        lishments, making up 29.3% in 2009. A       Organisation, June 2010


42 ::   polish market :: 2/2011
A new spot for culture and art is going to ap-       Bory Dolnośląskie (Lower Silesia For-               regained its old charm. A unique advantage         Castle, the winner of the “Family-friendly ho-
pear in Wroclaw this year. Barka Tumska              est) also proposes family tourism. The larg-        of this place is the well preserved natural, ur-   tel” certificate, has a special offer addressed
(The Tumski Barge) – the first restaurant             est dense forest area in Europe occupying the       ban and architectural landscape dating back        to the youngest guests. Children can partici-
on water in Wrocław has already begun co-            north-western part of Lower Silesia is becom-       to the 19th century. The trail, which is worth     pate in the “Explorers Expeditions” discover-
operation with the Wrocław Puppet Theatre            ing increasingly appreciated by tourists for        seeing and certainly passing through, is a pic-    ing the advantages of the place and its unique
and the Wro Art company. The aim is to cre-          its beautiful views (nature reserves, forests       turesque trail on the Kwisa River. The rafting     character. However, the Lower Silesia Forest
ate a new place, a platform for promotional          and extensive water areas).Through the ef-          route Kliczków-Przejęsław has mostly unreg-        is not only known for its rich flora, fauna and
activities of the city of Wrocław and an inter-      forts of the Lokalna Grupa Działania Bory           ulated banks, which provides a wide variety of     architecture. The area is also recognized for
esting form of entertainment for its tourists        Dolnośląskie (Local Action Group) and the           obstacles to overcome. Flowing on the swift        its long tradition in pottery. For centuries, the
and inhabitants. From the beginning of the           Pro Culturae Bono Foundation, the region            stream, one can enjoy the pristine look of the     tradition of Bolesławiec ceramics has become
next summer holidays (June 2011), tourists           is increasingly developing and is valued in terms   Kwisa Valley. The old, impressive oak trees or     synonymous with quality and high visual and
will be able to enjoy the new tourist trail called   of tourism. Among the large number of trails        steep valley slopes render to the attractive-      artistic value. Until today this tradition is culti-
“Travel with the fairytale bus”/ “Spacerownik        in this area, the most worth seeing are the         ness of the route. Agritourist farms and sta-      vated in ceramic plants Wisa, Nika and Błotny,
z Bajkobusem”. It is designed as an outdoor          thematic ones, including the “Trail of Histor-      bles offer horse-back riding camps, weekend         which still work on nineteenth century kilns,
family performance, which brought thousands          ic Parks and Gardens” listed as one of the elev-    horse-riding schools, recreational visits or       and lead interesting workshops for tourists,
of people to Wroclaw last year. This year’s edi-     en trails recommended by the Lower Silesian         horse trails rides. Additionally, the Kliczków     willing to learn how to make ceramic items.
tion is going to be bigger and better than in        Chairman Office, and the cooking trail ”For-
2010. It will be a real multimedia show with         est flavours”, which aims at showing the tour-
interactive elements. Moreover, visitors will        ists the heritage and tradition of the regional
have the chance to listen to live music – se-        cuisine based on natural fruit and mushrooms.
lected hits from composers previously living in      Local dishes can be tasted in the Castle Res-
Wroclaw. The last act of the spectacle will be       taurant in Kliczków, the winner of the Best
performed near the Tumski Hotel, on the ob-          Local Product award from the Lower Silesia
servation deck of the barge. The viewers will        Forest. The tourists on the trail will have the
be watching the show gathered on the oppo-           chance to see some historical buildings i.e.
site shore, on the Młyński Bridge and on the         residential compounds, castles, palaces, man-
terraces of the Tumski Hotel. In the sum-            sions, manorial buildings, garden architectural
mer, the restaurant and the Puppet Theatre           sites and examples of sacral architecture, as
are planning regular meetings for the guests         well as other valuable elements of the cultur-
of the restaurant during which the actors of         al heritage of Bory Dolnośląskie. One of the
the theatre will perform etudes. The coop-           tourist attractions worth a visit is the Klicz-
eration of the hotel with the Wro Art also           ków Castle, whose beauty and activities for
results in interesting projects in the field of       the benefit of culture and nature, blend in with
modern art on the trail. Their program will          the local trails. This is the perfect stop on the
include multimedia presentations and cultur-         journey where the tourist can rest, eat and
al education. Both the Tumski Hotel, awarded         sleep. The Castle is surrounded by a histor-
as being family friendly, and the Wroclaw Pup-       ic park designed in the 19th century by Eduard
pet Theatre count on high attendance among           Pezold. Owing to EU grants and the efforts of
the youngest guests.                                 the Pro Culturae Bono Foundation, the park
 Tourism




Polish hotel industry in 2011
Tourism is one of the most vigorous sectors of the Polish economy.                                           appropriate requirements concern-
                                                                                                             ing building, fi re and sanitary safety,
According to Vice-President of the Institute of Tourism in Warsaw Krzysztof                                  not awarded a category – recreation-
Łopaciński, PhD, tourism revenues, equal to all tourist expenditures,                                        al and vacation centres, guest rooms,
                                                                                                             health resorts, agritourism establish-
grew in 2010 by 6.4%, exceeding PLN 75 billion, which is 5.5% of GDP.                                        ments, Sunday recreational centres.
According to a government document, “Directions of tourism development                                           Hotels recognised by tourists
                                                                                                             across the world are of the great-
until 2015,” the importance of this branch of the economy will continue                                      est importance to the tourism mar-
to grow. A new growth stimulus will certainly be the organisation of the                                     ket and its development. From 2000,
                                                                                                             their number in Poland more than
Euro 2012 European Football Championship.                                                                    doubled – presently there are 1950 of
                                                                                                             them. The highest growth in quanti-
Janusz Turakiewicz                                                                                           ty occurred in the group of two and
                                                                                                             three-star facilities that have a main
                       One of the most important factors          a movement of hotel investments to         role on the Polish tourism market. The
                       influencing the achievement of this         smaller urban centres and tourist ar-      decrease in the number of one-star
                       growth is the development of tour-         eas is observed.                           hotels is related to the improvement
                       ism infrastructure facilities, especial-       In Poland, operating a lodging         in service standards. The number of
                       ly the lodging base. It currently num-     business requires listing it in a regis-   five-star hotels increased eightfold.
                       bers 7,000 facilities, with over 600,000   try kept by the province chairmen, as
                       rooms, from which 400,000 are year-        well as commune or municipality of-        The most important hotel brands
                       round. More than 1/3 of the facilities     fices. Chairmen confi rm that the fa-        in the world are present on the Polish
                       are located in southern Poland, in the     cility, equipment and service quality      market. The most important are
                       provinces of Dolnośląskie, Opolskie,       meet the minimum standard, cate-           brands belonging to ACCOR, a branch
                       Śląskie, Małopolskie and Podkarpac-        gorize the facility to the appropri-       investor and stakeholder in the quot-
                       kie, and almost 1/4 in Pomerania. Th is    ate type (hotels, motels, guest hous-      ed company ORBIS, presently own-
                       is also related to the concentration       es, hostels, youth hostels, campsites)     ing 57 hotels - Mercure (12), Novo-
                       of tourist attractions and important       and award them a category (marked          tel (10), Ibis (10), Etap (8) and Sofitel
                       urban areas – Cracow, the Tri-City         by the number of stars or Roman nu-        (3). The importance is growing of the
                       (Gdańsk, Sopot, Gdynia), Wrocław.          merals). The registries kept by com-       chains of RADISSON SAS, STAR-
                       After the development of urban hotels,     mune and municipality offices are            WOOD (Sheraton, Westin), HOLI-
                       reaching also beyond the aforemen-         for the remaining lodging establish-       DAY INN, LOUVRE HÔTELS (Cam-
                       tioned centres to Warsaw and Poznań,       ments, which only have to meet the         panile**, Premiere Classe*), BEST

44 ::   polish market :: 2/2011
                                                                                                                                                Tourism


WESTERN, B&B, SCANDIC. The ho-
tel chain QUBUS is also growing dy-
namically. MARRIOTT, InterConti-
nental, Le Royal Meridien and HILTON
are also present. Other big players in
the world hotel market are entering
Poland: Wyndham Hotel Group (SU-
PER 8), Steigenberger (InterCityHotel,
Motel One), Choince Hotels Interna-
tional (Quality).
    Hotel companies financed by
home-grown capital are also devel-
oping – GROMADA, INTERFERIE,
GEOVITA, PUHiT, Hotele Dia ment,
PTTK, WAM Hotel Group, GOŁĘ-
BIEWSKI, Vivaldi Hotels, Hotel 500,
ELBEST. Old names, frequent-
ly post-privatisation brands, which
secured their place on the market
back in the 1970’s as government-
owned enterprises, are still present
- Hotele Warszawskie SYRENA,
Przedsiębiorstwo Turystyczne [Tourist
Enterprise] ŁÓDŹ, Przedsiębiorstwo
Turystyczne KARKONOSZE in Jelenia
Góra, Przedsiębiorstwo Usługowo-
Turystyczne [Service and Tourist
Enterprise] PRZYMORZE in Słupsk,             Samotnia Refuge in
CENTRUM MAZUR in Giżycko – and               Karkonosze Mountains
still effectively compete with the new
companies. The importance of do-
mestic reservation groups STAR HO-          category     2000        2005   01.2011
TEL (50 economy hotels, 1*-3*) and             5*          6         16        47      Hotels *****
POLISH PRESTIGE HOTELS (37 ho-                 4*         40         66       176
                                                                                       Bydgoszcz: Bohema • Gdańsk: Dwór Gdański, Hilton, Podewils,
tels, 3*-4*) is growing. Polish invest-        3*        333        458       876
                                                                                       Radisson Blu Hotel • Katowice: Best Western Premier Katowice,
ments abroad are also becoming visi-           2*        285        421       638
                                                                                       Monopol • Kołobrzeg: Aquarius Spa • Cracow: Copernicus,
ble – GROMADA has facilities in Berlin         1*        260        151       214
and Cape Town, ORBIS manages a                                                         Crown Piast Hotel, Dwór Kościuszko, Grand, Gródek, Niebieski
                                             Total       924        1112     1951      – Art Hotel & Spa, Sheraton Kraków Hotel, Stary, Sympozjum,
Novotel in Vilnius.
                                                                                       Holiday Inn Kraków, Radisson SAS • Ostróda: Hotel Spa Dr Ire-
The hotel industry, together with          The development of the Polish hospi-        na Eris Wzgórza Dylewskie • Poznań: Sheraton Poznań Hotel
restaurant services, numbers over          tality business along modern lines is       • Pyrzowice: De Silva • Sopot: Rezydent, Sheraton, Sofitel Grand
100,000 registered enterprises, mostly     primarily determined by the manage-         Sopot • Szczawnica: Modrzewie Park Hotel • Tychy: Pirami-
owned and managed by private indi-         ment skills of Polish hoteliers. Thor-      da • Ustroń: Belweder • Warsaw: Hilton Warsaw & Conven-
viduals. Th is dispersion causes a lack    oughly educated in hotel management         tion Center, Victoria, Intercontinental Warszawa, Le Regina,
of reliable data regarding the econom-     and catering schools as well as in uni-     Marriott, Radisson SAS Centrum Hotel, Rialto, Royal Meridi-
ic effectiveness of this business. Ac-      versities, Polish hoteliers and chefs
                                                                                       en Bristol, Sheraton Warsaw Hotel & Towers, The Westin War-
cording to statistical information from    are rendering their services through-
                                                                                       saw • Wrocław: Monopol, Platinum Palace, Radisson Blu Hotel,
the Central Statistical Office (GUS)         out Europe. Increasingly more do so
                                                                                       Sofitel Wrocław, The Granary La Suite Hotel Wrocław • Kryn-
received from 282 of the largest en-       as managers. Many are frequenting
terprises, during January - Septem-        major hotel industry meetings. One          ica Zdrój: Prezydent • Zabrze: Alpex • Zakopane: Litwor, Vil-
ber of 2010, they achieved a net profit     is the Berlin the International Hotel       la Marilor
of PLN 420 million (a growth of PLN        Investment Forum (IHIF), the global
98 million compared to the previous        hotel investment community’s annual
year) and net return on sales at a lev-    meeting which attracts the most influ-
el of 6.7% (5.5%, a year earlier). Tak-    ential faces in the industry as speak-
ing into account that room occupancy       ers and attendees.                         Source:
rate reached 45.9% during this peri-           The expertise gained by Polish ho-     :: Institute of Tourism in Warsaw – www.intur.com.pl
od (39.3 for the entire 2009), the fore-   teliers abroad pays dividend in that it    :: Current official hotel and rating listing – http: //turystyka.crz.mg.gov.pl
casted growth in tourist traffic is good     enhances hotel service quality im-         :: Statistical Bulletin 12/2010, Central Statistical Office Warsaw, 2011,
news for the entire industry.              provement at home.                    ::      table 28 and 64.


                                                                                                                              2/2011 :: polish market ::        45
 Ranking of insurance brokers



Insurance broker – risk advisor
The fundamental task of a broker is to act for, and in the interest of,                                                                                        Presently, the broker is the largest entity in
                                                                                                                                                          obtaining institutional clients, group clients and
the client, requiring complex, comprehensive insurance protection.                                                                                        wealthy individual clients. Insurance companies
In this case, it is the role of the broker to assess the level of risk, design                                                                            are more willing to talk to a broker representing
                                                                                                                                                          a client. A broker does not only know insurance,
the insurance programme and negotiate the insurance conditions and                                                                                        but can place a product against the background
rates. Also, brokers are involved in a number of actions and functions                                                                                    of the entire market and competition. A broker
                                                                                                                                                          has the capability of negotiating a discount, low-
related to the insurance policy during the course of the policy.                                                                                          ering the rate, or even changing the terms of in-
                                                                                                                                                          surance, introducing special clauses, etc.
Rita Schultz                                                                                                                                                   In the case of many insurance companies,
                                                                                                                                                          cooperation with brokers is a business priority.
                                                                                                                                                               The meaning of a broker in the insurance
An insurance broker plays the role of a                                      analyze insurance terms, that’s why it is easier                             servicing of firms grows constantly. Only a few
link between the insurance company and the                                   and more assuring to entrust those to a broker.                              years ago, a broker was only concerned with
client. Professional service, the ability to effec-                               The largest brokers handle mainly com-                                   creating the insurance programme and bro-
tively and honestly identify risks, design pro-                              mercial insurance and group life insurance.                                  kering the insurance agreement. At present,
grammes and procedures securing the client                                   The latter are treated as servicing the compa-                               those firms that count on the broker market
against the negative financial consequences of                                ny and not individual employees. The broker’s                                undertake actions related to a multifaceted
chance events – these are the traits that char-                              clients are therefore all kinds of institutions,                             approach to helping during the claims proc-
acterize a good broker. Aside from brokering in                              business entities, large service, trade and in-                              ess and representation with respect to insur-
entering contracts and watching over all the                                 dustrial companies, etc.                                                     ance companies. Broker professionalism, his
formalities, his or her activity also involves                                   It is worthwhile to mention that insurance                               or her practice, knowledge of the regulations
representing the insured during the claims                                   brokers appeared in Poland only in the early                                 and procedures serve with excellence in pro-
handling process. Legal entities interested in                               1990’s and, at the beginning, insurance bro-                                 tecting client interests.
insurance protection of their assets do not al-                              kers were mistaken for another kind of inter-                                     The work of a broker is primarily based
ways have the possibility, ability or time to                                mediary – insurance agent.                                                   on trust, both during client/businessman

Main ranking – by revenue from brokerage operations in 2010




                                                                                                                                                                               for 2010, in
                                                                                                                                                                               operations




                                                                                                                                                                                                            in 2010, in
                                                                                                                                                                                               Number of
                                                                                                                                                                               brokerage
                                                                                                                              Firm




                                                                                                                                                                                                            insurance
                                                                                                                                             for 2009,




                                                                                                                                                              for 2010,




                                                                             Managing person/




                                                                                                                                                                                                            premium
                                                                                                                                                                               Revenue




                                                                                                                                                                                               business
                                                                                                                                             Revenue




                                                                                                                                                              Revenue




                                                                                                                                                                                                            Written
Pos.                       Name of brokerage firm                                                       Headquarters        established




                                                                                                                                                                                               clients
                                                                                                                                             in PLN




                                                                                                                                                              in PLN




                                                                                president
                                                                                                                                                                               from
                                                                                                                               in




                                                                                                                                                                                                            PLN
 1 Grupa AON                                                             Sławomir Bany                 Warsaw                1992         69 975 000,00    81 090 000,00       PLN
                                                                                                                                                                               45 084 000,00   2 000       560 000 000,00
 2 GRAS SAVOYE                                                           Alexander Leszek Konopka Warsaw                     1987        105 532 000,00   112 548 000,00       42 390 000,00   1 300       615 600 000,00
 3 MENTOR SA                                                             Marek Kaliszek                Toruń                 1995         30 232 455,00    35 500 000,00***    33 000 000,00   2 237       405 000 000,00
 4 NORD PARTNER Sp. z o.o.*                                              Krzysztof Bromka              Warsaw                1997         25 621 391,03    31 056 130,33***    30 554 462,79   2 600       209 593 300,00
 5 EIB SA                                                                Rafał Kaszubowski             Toruń                 1994         25 100 000,00    27 500 000,00***    27 350 000,00     500       196 640 000,00
 6 MAK Ubezpieczenia sp. z o.o.                                          Marcin Ślotała                Warsaw                2000         21 254 462,00    25 436 326,69***    25 436 326,69     511       135 368 520,00
 7 GrECo JLT Polska Sp. z o.o.**                                         Arkadiusz Jaśkowski           Warsaw                2001         18 038 879,00    22 455 144,00       22 237 390,00     706       145 512 485,00
 8 PWS KONSTANTA S.A.                                                    Jacek Kliszcz                 Bielsko-Biała         1995         19 300 000,00    21 020 000,00***    21 020 000,00     800       350 000 000,00
 9 STBU Brokerzy Ubezpieczeniowi Sp. z o.o                               Zbigniew Foltyński            Sopot                 1998         15 845 000,00    17 107 000,00***    16 980 000,00     500       120 376 000,00
 10 EKU Group -– Europejskie Konsorcjum Ubezpieczeniowe Sp. z o.o. Piotr Kumięga                       Warsaw                2003          7 851 032,00     8 928 763,00        8 928 763,00     580        38 931 754,00
 11 MAXIMUS Broker Sp. z o.o.                                            Remigiusz Breński             Toruń                 2001          4 991 982,32     6 570 231,03***     6 091 092,71     842        54 330 436,93
 12 CARBO Asecura SA                                                     Adam Prończuk                 Tychy                 1993          3 073 000,00     3 300 000,00        3 100 000,00     780        24 660 000,00
 13 Grupa Brokerska ODYS Sp. z o.o                                       Krzysztof Bethke              Bydgoszcz             2000          3 777 554,00     4 154 492,00****    3 082 271,00     587        26 276 354,00
 14 Dom Brokerski NEGOCJATOR                                             Sławomir Bajczyk              Elbląg                1998          2 609 044,85     2 712 469,60        2 712 469,60     633        20 282 972,00
 15 MAJKOWSKI Sp. z o.o. Zespół Brokerów Ubezpieczeniowych               Ireneusz Majkowski            Starogard Gd.         1998          2 103 275,58     2 398 728,52***     2 398 728,52     100        19 000 000,00
 16 International Risk & Corporate Advisory (IRCA)                       Jerzy Lisiecki                Warsaw                2004          1 409 558,21     2 176 273,60***     2 176 273,60     100        10 188 753,85
 17 Dom Brokerski EM BROKERS Sp. z o.o.                                  Edmund Suchomski              Warsaw                2006           977 864,00      1 045 000,00***     1 045 000,00     257         6 750 000,00
 18 Kancelaria Brokerska Rożek Brokers Group                             Bernard Rożek                 Sandomierz            1998          1 028 779,00      856 683,00          856 683,00      200         5 150 000,00
 19 Opty Way Sp. z o.o.                                                  Kinga Celinska                Warsaw                2001           659 790,39       689 860,00***       670 860,00        52        7 200 000,00
 20 ABRO Biuro Brokerskie                                                Andrzej Łempicki              Warsaw                2001           510 000,00       600 000,00          600 000,00      100         3 500 000,00
 21 Kancelaria Ubezpieczeń Gospodarczych Andrzej Hebel                   Andrzej Hebel                 Szczecin              2003           490 000,00       543 000,00          543 000,00      130         8 500 000,00
 22 PREMIUM Andrzej Ciesielski                                           Andrzej Ciesielski            Zielona Góra          1998           140 000,00       160 000,00          160 000,00        32        1 500 000,00
 23 EUROS                                                                Włodzimierz Stebnicki         Warsaw                2007           126 000,00       158 000,00          158 000,00        36        1 200 882,00
*      The results are only for the NORD Partner Sp. z o.o. company and do not include the results of other subsidiaries                                                                                      Source: Firms
**     Combined data for the GrECo JLT Polska Sp. z o.o. and JLT-SIACI Sp. z o.o. companies – in the merger process
***    Estimated
****   Whole group of companies



46 ::     polish market :: 2/2011
 Ranking of insurance brokers
contacts, as well as with the “producer” of                          Poland for 20 years, are producing results com-                          Ranking of brokers 2010
services, the insurance company. However, by                         parable to their colleagues with a foreign birth-                        We present a ranking of insurance brokers
observing the market, it can be definitely stated                     right, operating on the same market.                                     functioning in Poland. In order to show the
that professionalism, honesty and competence                            In order to ensure that solid and competent                           difference in the scale of their activity, both
are traits that characterize the largest broker-                     brokers function on our market, possessing                               leaders – the largest brokerage companies,
age firms in Poland. There are many firms that                         appropriate traits and abilities, exams have                             servicing large entities – as well as small-
are affiliated with world giants in the brokerage                      been introduced, whose theme encompasses                                 er brokers, catering to smaller and midsized
market but there are also many home-grown                            insurance law, rules that insurance operates                             enterprises, are shown. The data found in the
companies, who, thanks to a knowledge of the                         by and its basic nuances, ethics, the ability to                         ranking comes directly from insurance bro-
market and to the fact that they have been in                        analyze insurance company statements, etc.                               kers.                                        ::

Sub-ranking by average revenue from brokerage activity per broker*                   Sub-ranking by average premium paid by companies served by the broker, which indicates the size
                                                                                     of companies in the broker’s portfolio                               * premium/number of businesses
   1 MAK Ubezpieczenia Sp. z o.o.
                                                                                                                                                                                       Written
   2 International Risk & Corporate Advisory (IRCA)                                                                                                                Number of
                                                                                                                                                                                      insurance          Average
   3 GrECo JLT Polska Sp. z o.o.                                                     Pos. Name of brokerage firm                                                     business
                                                                                                                                                                                     premium in         premium*
                                                                                                                                                                     clients
   4 Grupa AON                                                                                                                                                                      2010, in PLN
   5 NORD PARTNER Sp. z o.o.                                                           1       GRAS SAVOYE                                                           1 300      615 600 000,00         473 538,46
                                                                                       2       PWS KONSTANTA S.A.                                                      800      350 000 000,00         437 500,00
   6 Kancelaria Ubezpieczeń Gospodarczych Andrzej Hebel
                                                                                       3       EIB SA                                                                  500      196 640 000,00         393 280,00
   7 STBU Brokerzy Ubezpieczeniowi Sp. z o.o.
                                                                                       4       Grupa AON                                                             2 000           5 600 000,00      280 000,00
   8 EKU Group – Europejskie Konsorcjum Ubezpieczeniowe Sp. z o.o.
                                                                                       5       MAK Ubezpieczenia Sp. z o.o.                                            511      135 368 520,00         264 909,04
   9 MAJKOWSKI Sp. z o.o. Zespół Brokerów Ubezpieczeniowych
                                                                                       6       STBU Brokerzy Ubezpieczeniowi Sp. z o.o.                                500      120 376 000,00         240 752,00
  10 Dom Brokerski NEGOCJATOR
                                                                                       7       GrECo JLT Polska Sp. z o.o.                                             706      145 512 485,00         206 108,34
  11 GRAS SAVOYE
                                                                                       8       MAJKOWSKI Sp. z o.o. Zespół Brokerów Ubezpieczeniowych                  100          19 000 000,00      190 000,00
  12 MENTOR SA
                                                                                       9       MENTOR SA                                                             2 237      405 000 000,00         181 046,04
  13 Kancelaria Brokerska Rożek Brokers Group
                                                                                      10       OPTY WAY Sp. z o.o.                                                      52           7 200 000,00      138 461,54
  14 EIB SA
                                                                                      11       International Risk & Corporate Advisory (IRCA)                          100          10 188 753,85      101 887,54
  15 Grupa Brokerska ODYS Sp. z o.o.
                                                                                      12       NORD PARTNER Sp. z o.o.                                               2 600      209 593 300,00          80 612,81
  16 PWS KONSTANTA S.A.
                                                                                      13       EKU Group – Europejskie Konsorcjum Ubezpieczeniowe Sp. z o.o.           580          38 931 754,00       67 123,71
  17 CARBO Asecura SA                                                                 14       Kancelaria Ubezpieczeń Gospodarczych Andrzej Hebel                      130           8 500 000,00       65 384,62
  18 ABRO Biuro Brokerskie                                                            15       MAXIMUS Broker Sp. z o.o.                                               842          54 330 436,93       64 525,46
  19 Opty Way Sp. z o.o.                                                              16       PREMIUM Andrzej Ciesielski                                               32           1 500 000,00       46 875,00
  20 Dom Brokerski EM BROKERS Sp. z o.o.                                              17       Grupa Brokerska ODYS Sp. z o.o.                                         587          26 276 354,00       44 763,81
  21 MAXIMUS Broker Sp. z o.o.                                                        18       ABRO Biuro Brokerskie                                                   100           3 500 000,00       35 000,00
  22 PREMIUM Andrzej Ciesielski                                                       19       EUROS                                                                    36           1 200 882,00       33 357,83
  23 EUROS                                                                            20       Dom Brokerski NEGOCJATOR                                                633          20 282 972,00       32 042,61
* 2010 revenue/number of brokers                                                      21       CARBO Asecura SA                                                        780          24 660 000,00       31 615,38
                                                                                      22       Dom Brokerski EM BROKERS Sp. z o.o.                                     257           6 750 000,00       26 264,59
                                                                                      23       Kancelaria Brokerska Rożek Brokers Group                                200           5 150 000,00       25 750,00


Firms by number of brokers employed                                                  Sub-ranking by growth in revenue in 2010 versus 2009                                            * premium/number of businesses


                                                               Number of chartered                                                                                   Revenue            Revenue          Increase
Name of brokerage firms
                                                                brokers employed      Position                       Name of brokerage firm                           for 2009           for 2010        in revenue
GRAS SAVOYE                                                           94                                                                                              in PLN             in PLN          in 2010
MENTOR SA                                                             76                   1       International Risk & Corporate Advisory (IRCA)                    1 409 558,21       2 176 273,60      1,544

Grupa AON                                                             70                   2       MAXIMUS Broker Sp. z o.o.                                         4 991 982,32       6 570 231,03      1,316

EIB SA                                                                65                   3       EUROS                                                              126 000,00         158 000,00       1,254

PWS KONSTANTA S.A.                                                    56                   4       GrECo JLT Polska Sp. z o.o.                                      18 038 879,00     22 455 144,00       1,245

NORD PARTNER Sp. z o.o.                                               55                   5       NORD PARTNER Sp. z o.o.                                          25 621 391,03     31 056 130,33       1,212

MAXIMUS Broker Sp. z o.o.                                             38                   6       MAK Ubezpieczenia sp. z o.o.                                     21 254 462,00     25 436 326,69       1,197

STBU Brokerzy Ubezpieczeniowi Sp. z o.o                               32                   7       ABRO Biuro Brokerskie                                              510 000,00         600 000,00       1,176

GrECo JLT Polska Sp. z o.o.                                           31                   8       MENTOR SA                                                        30 232 455,00     35 500 000,00       1,174

EKU Group - Europejskie Konsorcjum Ubezpieczeniowe Sp.z o.o.          18                   9       Grupa AON                                                        69 975 000,00     81 090 000,00       1,159

MAK Ubezpieczenia sp. z o.o.                                          15                10         PREMIUM Andrzej Ciesielski                                         140 000,00         160 000,00       1,143

CARBO Asecura SA                                                      10                11         MAJKOWSKI Sp. z o.o. Zespół Brokerów Ubezpieczeniowych            2 103 275,58       2 398 728,52      1,140

Grupa Brokerska ODYS Sp. z o.o.                                        8                12         EKU Group – Europejskie Konsorcjum Ubezpieczeniowe Sp. z o.o.     7 851 032,00       8 928 763,00      1,137

Dom Brokerski NEGOCJATOR                                               6                13         Kancelaria Ubezpieczeń Gospodarczych Andrzej Hebel                 490 000,00         543 000,00       1,108

MAJKOWSKI Sp. z o.o. Zespół Brokerów Ubezpieczeniowych                 5                14         Grupa Brokerska ODYS Sp. z o.o.                                   3 777 554,00       4 154 492,00      1,100

Dom Brokerski EM BROKERS Sp. z o.o.                                    5                15         EIB SA                                                           25 100 000,00     27 500 000,00       1,096

International Risk & Corporate Advisory (IRCA)                         3                16         PWS KONSTANTA S.A.                                               19 300 000,00     21 020 000,00       1,089

Opty Way Sp. z o.o.                                                    3                17         STBU Brokerzy Ubezpieczeniowi Sp. z o.o                          15 845 000,00     17 107 000,00       1,080

Kancelaria Brokerska Rożek Brokers Group                               2                18         CARBO Asecura SA                                                  3 073 000,00       3 300 000,00      1,074

ABRO Biuro Brokerskie                                                  2                19         Dom Brokerski EM BROKERS Sp. z o.o                                 977 864,00        1 045 000,00      1,069

Kancelaria Ubezpieczeń Gospodarczych Andrzej Hebel                     1                20         GRAS SAVOYE                                                     105 532 000,00    112 548 000,00       1,066

PREMIUM Andrzej Ciesielski                                             1                21         Opty Way Sp. z o.o.                                                659 790,39         689 860,00       1,046

EUROS                                                                  1                22         Dom Brokerski NEGOCJATOR                                          2 609 044,85       2 712 469,60      1,040
                                                                                        23         Kancelaria Brokerska Rożek Brokers Group                          1 028 779,00        856 683,00       0,833


48 ::    polish market :: 2/2011
                                                                                              Ranking of insurance brokers



Proving the great potential
of the insurance
intermediation sector
    The history of the MAK Group insurance company is, one
    can say, an ideal example of utilizing economic freedom
    and achieving success. The firm was created 10 years ago,
    and currently plans a debut on the New Connect mar-
    ket. At what stage are the preparations? How much will
    the offer be for?
The preparations of the MAK Group are at the starting phase.
We have created a holding structure, in which MAK Invest-
ments S.A. plays the leading role – an entity registered in
2010, owner of the operational companies. The following
companies are part of the MAK Group: MAK Ubezpieczenia
Sp. z o.o. (insurance broker), Agencja Konsultant Sp. z o.o.
(insurance multiagency), Agencja Wasilewski & Olech Sp.
z o.o. (agency exclusive to Allianz Polska) and Dealer Di-
rect Polska Sp. z o.o. (multiagency operating on the deal-
er market).
    We have also chosen the broker’s office (IPOPEMA Secu-
rities S.A.), which is responsible for comprehensively han-
dling the planned transaction. We also signed an agreement
with BDO Sp. z o.o., which will conduct a fi nancial audit
of the holding for the purposes of introducing the fi rm on
the New Connect market.
    Our fi nance team is working at this moment on closing
the books for 2010, which will enable BDO to start the au-
dit work. At the same time, IPOPEMA will begin the busi-
ness and fi nancial due diligence of the MAK Group. Our goal       What is the fi rm’s revenue for 2010? What is the fore-
is to conduct the debut in May of this year, prior to which       cast for 2011?                                                 Marcin Ślotała,
we will enter the market with a private offer to sell stock,    2010 was another good year for MAK Group, whose consol-           President of
directed at private and institutional investors. We are not    idated revenue amounted to around PLN 48 million, with            the Board of
planning to issue new stock at this phase, only the sale of    a premium placement at the level of PLN 275 million. We           MAK Ubezpieczenia
                                                                                                                                 sp. z o.o.
existing shares from present owners of the holding.            are planning growth at the level of 116-120% for 2011, not
    We would like to raise funds from the sale of shares in    considering any mergers or acquisitions, which we are not
the amount of PLN 12-15 million.                               ruling out this year.

     What will the funds from the issue be used for? Are you       What are your further plans? Maybe entry to the Stock
     planning any mergers or takeovers?                            Exchange’s main market?
Funds from the private offer will go directly to the share-     Certainly, our strategic goal is the entry to the Stock Ex-
holders. Of course, we are planning the continued dynamic      change’s main market, which should occur within 12 months
growth of our Group, also involving mergers and takeovers.     following the debut on New Connect.
We are actively monitoring the market from that angle, but         We have the ambition to become the fi rst representative
it’s too early to discuss any details.                         of our industry on the Stock Exchange, proving the great
     Naturally, we will fi nance potential acquisitions and     potential of the insurance intermediation sector.
large business projects by issuing equity.                         We also have a whole range of plans directly related to
                                                               the operations side of our business and the development of
                                                               our client portfolio.
                                                                   The details of our activities will soon be made available
                                                               through the exchange’s communiqués.                         ::

                                                                                                                     2/2011 :: polish market ::   49
 Ranking of insurance brokers



Stability and wise conservatism
Despite many years have passed since the Polish insurance market was
transformed, one can hardly call it a mature market. Due to wrong
legislation and practice, insurance brokers’ working conditions have
remained unstable.

Jacek Kliszcz
                                                                                                           corporate clients with multinational
                                                                                                           capital tend to use services provided by
                                                                                                           brokerage fi rms based outside Poland,
                                                                                                           which results from implementing in-
                                                                                                           ternational insurance programmes
                                                                                                           initiated by the mother companies.
                                                                                                               As regards the quality of brokerage
                                                                                                           services, Polish fi rms are not inferior
                                                                                                           to the most reputable international
                                                                                                           companies. And in many cases their
                                                                                                           decision-making capacity, as they op-
                                                                                                           erate on the domestic market, gives
                                                                                                           them a competitive edge. On a devel-
                                                                                                           oped market, there is enough room for
                                                                                                           all forms of brokerage activity. A fa-
                                                                                                           vourable sign is the gradual special-
                                                                                                           isation of brokerage fi rms and their
                                                                                                           growing professionalism.
                                                                                                               Clients using brokerage services
                                                                                                           are increasingly aware of their rights,
                                                                                                           which means increased risk of claims
                                                                                                           being lodged against brokers who have
                                                                                                           made a professional error. We have
                                                                                                           already seen the fi rst court cases in
                                                                                                           which clients have been awarded sig-
                                                                                                           nificant amounts of money in compen-
                                                                                                           sation from brokers.
                                                                                                               It seems that an important issue for
                                                                                                           the brokers’ community would be to
                                                                                                           recognise it as a freelance occupation
Alongside distribution channels              On the brokerage market, there has                            and create a strong trade association
described in the law on intermedia-      been stabilisation in terms of setting     Autor is a President   of brokers. If the membership were
tion, new acquisition concepts are now   up new fi rms but major consolidation       of PWS Konstanta       obligatory, the association could cre-
emerging, like for example those asso-   moves have not been visible either. The                           ate a framework necessary for adopt-
ciated with bancassurance, and they      market has been dominated for years                               ing standards of brokers’ practice and
seem to destabilise the market.          by a group of 15-20 brokerage fi rms,                              would have an influence on how con-
    Stability and wise conservatism      which generate 80% of their written                               tentious issues are solved.            ::
are the most important factors in the    premium through this channel. De-
work of a broker and – as it seems –     spite no major increase in nominal
in the operation of the whole insur-     terms in the premium distributed by
ance market. The price war waged by      brokers, owing to a significant drop in
insurance companies in recent years      insurance companies’ tariffs, brokers
resulted in the need to correct premi-   have a rising share in placing commer-
ums after the year 2010, which saw a     cial clients’ risks, as the awareness of
sharp rise in claims for damages. Most   insurance clients grows.
insurance companies suffered severe           Brokers representing large foreign           The market has been dominated for years by a group
losses and recorded a negative balance   corporations and Polish fi rms com-              of 15-20 brokerage firms, which generate 80% of their
on the technical account.                pete on the Polish market. However,                            written premium through this channel

50 ::   polish market :: 2/2011
                                                                                                   Ranking of insurance brokers
              “Polish Market” talks to
   Krzysztof Bromka, President of the
      Board of Nord Partner Sp. z o.o.              High quality services
    Nord Partner provides expert services to        and representative offices. Nord Partner boasts      is to support the activities taken up by ter-
    business entities. Our ranking reveals it       the largest number of brokerage establish-         ritorial units and provide services to strate-
    does so for a record number of customers.       ments in Poland. Located mainly in the biggest     gic customers.
    What is specific about this market and how       cities, there are currently 22 of them.                Another significant achievement in 2010
    do you meet customer expectations?                  In order to provide our customers with         was the commencement of cooperation with
Indeed, Nord Partner Sp. z o.o. is a leading bro-   high quality services, we use the newest IT        foreign insurance markets – London in partic-
ker in Poland, specialized in the provision of      technology which keeps being updated to live       ular. As of now, we have the capacity to pro-
services to various business entities. Our cli-     up to the market specifics and expectations.        vide our customers with insurance protec-
ent portfolio is extensive and diversified. It                                                          tion in London on conditions which are often
consists of banks, leasing companies, firms              Which achievements were most satisfac-         more favourable than those offered in Poland.
from the energy sector, representative units            tory to you in 2010?
of both light and heavy industry, construction      Most importantly, we maintained and solid-             What are the plans for this year, then?
enterprises, international carriers, and local      ified our stable standing in terms of being a       Further dynamic growth, improvement of
government institutions (cities, communes).         leading broker in Poland. The number of cus-       procedures, launching new estate insurance
    Such a wide scope of services demands           tomers was constantly rising, and all of them      products and insurance solutions known from
knowledge, experience, and professionalism          were satisfied with the cooperation. It trans-      the West.
of staff – all of which Nord Partner has. At the     lates directly and indirectly to our fi nancial         We would like to boost revenue and devel-
moment, we employ 100 people out of whom            results. Since they are pretty good, we can        op life insurance services for our customers.
55 are certified brokers. To give the best possi-    keep investing in people and technical solu-           Another idea is to grow in the field of con-
ble service, our employees continuously raise       tions, including IT.                               sultancy in the widely understood process of
their qualifications and take part in compa-             2010 saw quite a bit of restructuring inside   risk assessment and management. We view
ny-organized training courses – both inter-         the company. Apart from the introduction of        this type of consultancy as the basic tool in
nally and externally.                               new procedures, we redefined the rules of co-       providing insurance policies to businesses,
    It is quite important for a number of our       operation between territorial branches and         including those protecting company inter-
customers that our brokers are accessible           the company headquarters where all the de-         ests and optimizing insurance costs and con-
through a well-developed network of branches        partments and product offices are. Their task        ditions.                                      ::




                                                                                                                        2/2011 :: polish market ::   51
 Ranking of insurance brokers

The Polish brokerage market reached the
age of maturity several years ago and is fully
mature now. Polish brokers do not have any
                                                                    Polish brokerage
reasons for having complexes comparing
to their Western European colleagues. The
insurance mediation market guarantees
                                                                    market
security and high quality of services, but                          advisor, but also an “insurance attorney”      apart from insurance specialists, em-
                                                                    of the client in case of loss occurrence.      ploys two Olympic champions. In order
which is the most significant for clients –                          With such a broker the client wants to         to arrange an effective insurance pro-
high competitiveness. Can we still learn                            cooperate for a longer time. Both in Po-       gramme, knowledge of the insurance
                                                                    land and Western Europe it could be            market as well as the specific character
from our Western neighbours?                                        observed that, especially in a difficult         of the client and the sector is necessary.
                                                                    economic situation, the client-broker
Aleksander Leszek Konopka                                           relation was more and more permanent.          A second area where we can bene-
                                                                                                                   fit from Western European markets is a
                                                                    Although the market is mature,                 broader, not only insurance, approach
                       There are many proofs that the               there are at least two areas where West-       to risk issues. The broker’s role is so wide
                       Polish market is mature. One of them         ern Europe may be a determinant for us.        that, apart from insurance, he deals with
                       is clients’ security. I am thinking about    The first area is specialization. There are     the entire risk analysis in the company
                       minimum guarantee sums in case of            four types of entities on the brokerage        and offers insurance and preventive so-
                       professional third party liability of        market. First are major international          lutions as well as alternative risk place-
                       insurance brokers which were intro-          players such as Gras Savoye. A big in-         ment solutions. We already offer many
                       duced by the EU directive. Minimum           ternational broker provides services in        services in this scope and constantly
                       liability limits are at present similar in   the scope of all insurance lines and in        benefit from international know-how.
                       the entire European Union and guar-          addition has strong specializations. The       Nevertheless, two issues hamper devel-
                       antee security to our clients.               second type constitute big local/Polish        opment of this approach. First of all, our
The author is the
                           Moreover, clients are more and more      brokerage companies which also place           economic potential is still behind the
President of the
                       conscious and mature. They already           all types of risks. In terms of big broker-    Western European potential, so there
Management Board
of Gras Savoye         know what expectations they can have         age companies, Western European and            are definitely fewer entities which po-
Polska, insurance      towards brokers. They expect among           Polish markets are similar to each other.      tentially qualify to complex risk man-
broker                 others a complex service which un-           A different situation is with small play-       agement and creation of solutions such
                       der the Polish law cannot be provid-         ers – in Western countries they are ge-        as captive, i.e. a type of insurance un-
                       ed exclusively by an insurance broker.       ographically assigned to one area (third       dertaking dedicated for a given capi-
                       Therefore, we adjust our structures so       type of brokers – small regional players)      tal group. Although we do arrange risk
                       that the client has access to the maxi-      or have their own, most frequently niche       management programmes for our region
                       mum number of services in one place.         specialization (fourth type). In Poland        of Europe, we still act more as a perform-
                           The Polish market is characterized       entities with such a strong niche special-     er than a creator of worldwide insur-
                       by strong competitiveness and high           ization are still rare. A specific feature of   ance programmes and risk management.
                       stability. Every year we observe bro-        the brokerage market is that we have to            A second issue is our entrepreneurs’
                       kers being crossed out from the regis-       be specialists not only in the insurance       approach. Some of them already can
                       ter of brokers due to non-fulfi llment        sector but also the sector of the customer     see benefits from such solutions, but
                       of legal requirements. However, these        for whom we place risks. If it is a big en-    most of them will have to be won over
                       events are rare and marginal.                ergy or construction company, knowl-           for such a global risk management ap-
                           Another evidence for the maturity        edge of the specific character of activity      proach. Especially as benefits from
                       of our market in comparison to West-         of heat and power plant or general con-        such solutions are visible in the mid-
                       ern market was the crisis which affected      tractor in the construction process is         and long-term perspective. Recently,
                       the world in the past years. It appeared     necessary. In big brokerage companies          in a not easy economic context, entre-
                       that both Poland and Western Europe          we may find specialists in particular ar-       preneurs have searched for immediate
                       faced identical problems and dealt with      eas. A small company may not be able           savings, which usually do not positive-
                       them similarly. The price is not the only    to arrange an effective insurance pro-          ly influence the company’s situation.
                       determinant of development any more.         gramme for a construction or energy                After 20 years of development, we
                       Significant became quality, stability, se-    company as well as for a university or art     already caught up with our Western
                       curity and added values which could be       gallery. In Western Europe, companies          European partners. Although there
                       offered to clients. As in Western Europe,     with strong specialization employ spe-         are areas in which we can benefit from
                       competitiveness is not only connected        cialists of a given sector – construction      foreign know-how, it is edifying that
                       with the price. The client is aware that     or history of art, which enables gaining       we notice, within the framework of
                       he can require something more than           competitive advantage in a given, fre-         our international contacts, that our
                       mediation in conclusion of an insurance      quently niche area. As an example, our         solutions may also be inspiring for
                       agreement from the broker – broker is an     French department of sports insurance,         Western Europe.                            ::

52 ::   polish market :: 2/2011
Faurecia in Gorzów Wielkopolski
The Company Faurecia Gorzów acquired a permit to invest in the
Kostrzyń-Słubice Special Economic Zone. The company, which has
been operating in Gorzów Wielkopolski in western Poland for sever-
al years, plans to expand its business. It is to buy two new production
lines and a painting workshop to manufacture innovative products:
dashboards and door panels for the new Mercedes-Benz S-Class and
Volvo cars. Expansion of production will require further investments
in the company’s facility infrastructure. Th is will involve enlargement
of the production floor, building a logistic station and warehouses as       Europe’s largest PE foam producing plant opens in Poland
well as more workshop and office space. The investment will be car-           Early this January Novostrat has launched the production of polyeth-
ried out on a 7.6 ha large area, in Complex No. 1 of the Gorzów Wielko-     ylene foam in its new plant in Olszyna. Th is is to become the largest
polski Economic Subzone.                                                    polyethylene foam producing facility on this Continent. The factory,
    Investment outlays in the project are estimated to reach PLN 40         situated in south-western Poland near the border with Germany and
million by the end of 2013. Ten new jobs will be created while over-        the Czech Republic, produces foam for building insulation, soundproof-
all employment is to be maintained at a minimum of 685 jobs until           ing and packaging as well as underlay for wood and laminate floors.
the end of 2018.                                                                The factory’s entire output is to be exported to western Europe,
                                                                            mainly to France and Germany. Novostrat runs its plants in France,
                                                                            Ireland and in Poland. The one already operating in Poland for some
                                                                            time is situated in Pabianice and supplies PE foam packaging to the
Michelin Polska invests in the Warmia and Mazury Special                    global computer giant Dell.
Economic Zone                                                                   Novostrat acquired the factory buildings and premises from the
Michelin Poland is one of the biggest employers in Warmia and Maz-          Olszyna Furniture Factory after it went bankrupt two years ago with
ury, the region situated in the north-eastern part of the country. It is    360 employees losing their jobs. The new factory is to employ up to
an area with a high unemployment rate. The company has undertak-            300 people when all foam producing plants will become operational
en to create 15 jobs and to maintain the present 4,154 full-time jobs in    and reach full manufacturing capacity.
its plant in Olsztyn till the end of 2015. On-site training as well as in
Michelin plants abroad is planned to raise the employees’ qualifications.
    The French investor declared to invest at least PLN 81,230,000 up to
the end of 2015. Th is is to increase annual output from 38,000 tonnes      Danish X-Yachts ventures into Poland
of tires (about 447,000 units) to 50,000 tonnes (ca 588,000 units) in       X-Yachts, the internationally recognised luxury yachts producer from
2015 and productivity by more than 30%.                                     Denmark, will manufacture laminate yacht components in Poland.
                                                                            Its world-class products will be turned out in the X-Yachts facility in
                                                                            Gołdap in north-eastern Poland using state-of-the art Danish tech-
                                                                            nology and organisational solutions.
Norwegian Nevion steps into the Tri-city                                        It is estimated that the facility’s annual turnover will reach EUR
The main reasons that prompted the Norwegian investor to choose             60 million (PLN 250 million). Its total output is to be exported. The
the Tri-city metropolitan conurbation of Gdańsk, Gdynia and Sopot           facility is situated in the Gołdap subzone of the Suwałki Special Eco-
is the availability there of highly-qualified and experienced manage-        nomic Zone in north-eastern Poland. The company, which has al-
ment staff, proximity to its headquarters and direct fl ight connections      ready started co-operation with local subcontractors, will invest EUR
with Scandinavia. The fact that Nevion has been co-operating with           15 million and the project is expected to generate 80 jobs.           ::
the Gdańsk-based NOTE and TStronic companies for three years also
played a part in the decision.
    The Gdańsk-based Nevion division will manufacture advanced tel-
ecommunications equipment (audio and video transmission devices
for TV broadcasters), and more precisely assemble, test and distrib-
ute that equipment for the whole Nevion Group worldwide.
    In 2010, the value of the investment in Gdańsk amounted to PLN
1,000,000. The estimated sales value in the company’s Gdańsk divi-
sion is to reach EUR 6 million in 2011.

                                                                                                                      2/2011 :: polish market ::   53
 Opinion

                                                                                                                             Generally speaking the fi rst four



Pecking order
                                                                                                                             methods have no cost-minimizing
                                                                                                                             mechanisms and sometimes resort
                                                                                                                             to a negotiation mechanism involv-
                                                                                                                             ing a simple proposition – you’ll get
                                                                                                                             it, but it will be a little less. Inter-
                                                                                                                             estingly, Polish government agencies
Prof. Krzysztof Żmijewski                                                                                                    prefer administrative methods (1÷4)
                                                                                                                             over their market counterparts (5÷7).
                                                                                                                             Th is is so despite a permanently de-
                             The market is a much better so-                  accelerated depreciation, VAT cuts,            clared shortage of funds. Let us ana-
                             lution than central planning. Better,            etc.), and much better visible in fi-           lyze a few examples.
                             but not perfect. At times its tough              nancial support systems like funds,
                             and even brutal rules need tempering,            certificates or feed-in-tariffs. In these        :: A classical beauty contest situa-
                             sometimes for reasons of social policy,          solutions the amount and scope of the               tion is granting support from the
                             in other cases environmental policy              support is limited either by the fund               Eco-Fund, which almost from the
                             – but the aim is always to support or            amount or social costs (rising prices).             very outset designated “ecological
                             promote solutions we consider useful/            The question, therefore, is whom and                effect” costs for each project and
                             necessary/inevitable and which can-              how much to give – in other words,                  made decision on that basis. The
                             not defend themselves on the market.             the pecking order.                                  drawback here is that the method
Secretary,
                                 A case in point is climate and en-                                                               used to calculate ecological effect
Social Council
for the National             ergy policy. The market is excellent             We know quite few support allo-                     costs was too intransparent to al-
Emissions Reduction          in resolving local, short-term oper-             cation systems, including:                          low assessment by applicants.
Programme                    ational problems but strategic, glo-                                                            ::   The National Environment Pro-
                             bal and long-term issues escape its              1. Royal (support is granted to the                 tection Fund mainly uses the fi rst
                             influence (i.e. the market resolves                  grantor’s favourite; sometimes                   two methods, the choice largely
                             them badly by, for instance, putting                called allotment by merit),                      depending on the political prefer-
                             profit over investment). Below is a list          2. Beauty Contest (support is grant-                ences of the ruling coalition – the
                             of problems we have to solve outside                ed to the project that best meets                more liberal it is, the more it will
                             the market:                                         the grantor’s subjective and usu-                use the Beauty Contest system, an-
                             - renewable energy development,                     ally publicly unknown criteria),                 ti-liberals tend more towards the
                             - biofuel promotion,                             3. Tamerlane’s Rule (support is grant-              Royal solution, i. e. they pay more
                             - support of co-generation,                         ed to all projects meeting set and               attention to who is applying for aid
                             - support of the thermal moderni-                   usually known criteria),                         than for what it is to go.
The Polish                      zation of buildings,                          4. First come fi rst served (similar to         ::   In keeping with the Law on Ther-
administration               - energy efficiency promotion,                        Tamerlane’s Rule; all projects meet-             mal Improvement Projects support
prefers                      - CCS development,                                  ing the criteria get support in order            was to be granted to all who meet
administrative               - clean carbon technology develop-                  of application),                                 the prescribed criteria. And indeed
systems and                     ment,                                         5. Tender (support is granted to the                the Bank Gospodarstwa Krajowe-
evidently                    - support of nuclear energy,                        best projects ranked on a rank-                  go (National Economy Bank) made
dislikes                     - and many others.                                  ing list according to the extent to              consistent use of Tamerlane’s Rule
quasi-market                                                                     which they meet the criteria until               until its funds for a given year ran
methods,                     The main problem is that each of the                the funds are exhausted),                        out. In effect the system was non-
despite open                 systems applied must contain itself in           6. Auction (like Tender with offers up-              statutorily changed to First Come
declarations in              specific and limited resources. Th is is             dated on a running basis),                       First Served with a quiet addition
support of the               less visible (although, of course, exist-        7. Online auction (fiercer than clas-                of an element of the Royal meth-
free market.                 ent) in tax relief systems (tax credit,             sical auctions).                                 od – support was granted only to
                                                                                                                                  projects which had earlier received
                                                                                                                                  a credit promise from a cooper-
                                                                                                                                  ating commercial bank (i.e. were
No. Feature                              Administrative Methods               Quasi-Market Methods                                found “worthy” of aid). Luckily
1       transparency                     low to medium                        medium to high
                                                                                                                                  such banks were pretty abundant
                                                                                                                                  so the procedure was not subjective
2       project costs                    lower                                higher
                                                                                                                                  in character. Historians should note
3       need to foresee eff ects          low                                  high                                                that the original version of the Law
                                         decision by official, hand-steered   decision by system parameters and automatic!        mentioned competitions whose ba-
                                                                              no hand-steering
                                                                                                                                  sic parameter was to be the highest
4       exploitation costs               high but concealed (staff salaries)   low but public (system exploitation)                updated Net Project Value, which
5       efficiency                       low                                  high                                                would have made the contests into
                                                                                                                                  tenders for a specific aid amount
6       public fund saving               none or low                          high
                                                                                                                                  earmarked in the annual budget.
7       difficulty in constructing system low                                 high
                                                                                                                                  Th is would have allowed investors

54 ::    polish market :: 2/2011
                                                                                                                                             Opinion

     to judge for themselves whether         :: The only instance of consistent Ta-          Quite clearly the Polish adminis-
     they had any chances for support.            merlane’s Rule application I know          tration prefers administrative systems
     The idea was abandoned (after hefty          of is the distribution of agricultur-      and evidently dislikes quasi-market
     criticism from… the Ministry of Fi-          al aid, which is really granted to all     methods, despite open declarations in
     nance).                                      who meet the publicly-announced            support of the free market. I attempt
::   Various aid grants offered by the             criteria.                                  to explain why in the table on page 52.
     Industrial Development Agen-            ::   Online tendering is described in               Unfortunately the above table leads
     cy are usually distributed under             a draft Law on Energy Efficien-              us to the sad conclusion that admin-
     the Royal system. Beneficiaries               cy and concerns the distribution           istrative systems probably owe their
     are pre-selected and granted aid.            of white certificates in exchange           popularity to points 3 and 7.
     Quite simple, though completely              for carrying out energy-efficient                I believe the above analysis offers
     intransparent.                               projects. The tender mechanism             a partial explanation of the secret be-
::   Aid granted by the Polish Agen-              itself is quite simple and manage-         hind the well-known fact that em-
     cy for Enterprise Development                able by means of several hundred           ployment in the public administra-
     (PARP) is usually distributed un-            code lines (I used to be a program-        tion has grown considerably (by over
     der the Beauty Contest system. The           mer). However, it has met with             100,000–36%! – over the past decade),
     rules rarely allow investors to as-          strong resistance, mainly from             while the general impression is that it
     sess their chances.                          the public administration. I won-          has become less efficient. Perhaps the
::   Interestingly, also EU funds are             der why?                                   solution would be to cease hand-steer-
     usually distributed by administra-      ::   I would be grateful if readers pro-        ing the country and turn to more auto-
     tive procedures, which means ei-             vided me with examples of oth-             mated (parameterized, computerized)
     ther by Beauty Contest rules or ac-          er granting methods, especially            and transparent procedures. I suggest
     cording to application (much rarer).         quasi-market systems like 5÷7.             a citizen-driven country.             ::




Far from average wealth
Andrzej Arendarski, PhD

                       Slowly but surely, we are climbing            was underlined by Prime Minister Don-          and investments, are sceptic when it
                       up the ladder in EU “wealth” statistics       ald Tusk in an interview for the German        comes to conditions of running a busi-
                       – or the per capita gross domestic prod-      daily “Die Welt”, in which he said “We         ness and the business climate in gen-
                       uct, calculated according to purchasing       are recently observing that Commu-             eral. Only 27% of businessmen believe
                       power parity. Data for 2009, published        nity thinking is weaker in the EU. This        that the conditions of running a busi-
                       by Eurostat, show that Poland managed         is expressed, for example, in that the         ness will improve by next year. 28% be-
                       to cross the threshold of 60% of the EU       gap between euro-zone countries and            lieve that they will change for the worse
                       average (it was 56% in 2008). Thanks          those outside is becoming greater. This        and 43.6% - that they will remain the
                       to this, Poland advanced to 5th place         is a reminder of the unfortunate project       same. This places Poland in a group of
                       (counting from the end – unfortunate-         of a two-speed Europe. This sounds as          countries with the lowest assessment
Co-founder and
president of the
                       ly) of the EU GDP ranking. On the one         though someone wanted to close down            of future business conditions.
Polish Chamber of      hand, it is pleasing that we are closing      part of the Community.”
Commerce right         the gap. On the other, however, Euro-                                                        The problem of a friendly busi-
from its inception     stat data clearly show the great distance     We cannot however burden oth-                  ness environment has accompanied
                       separating Poland from the wealthi-           er EU countries, which are focused on          Polish businessmen from the moment
                       est countries of the European Union.          their own problems, with the respon-           when political and economic changes
                       Th is is a particularly important mat-        sibility for the rate of our own eco-          started, i.e. since 1989. In over twen-
                       ter in the light of events in the Europe-     nomic growth. It is in Poland that we          ty years, the problem has not yet been
                       an and world economy, which we have           should strive to create ideal conditions       solved and businessmen are still deal-
                       been observing over the last couple of        for economic growth and to enhance the         ing with many unnecessary, often ab-
                       years. The world financial crisis and the      wealth of our society. This is apparent-       surd legal and administrative barriers.
                       euro-zone crisis intensified tendencies        ly obvious, but in practice, it is not. This   If it could be managed to finally solve
                       towards protectionism and national-           is confirmed by the Polish Chamber of           these problems, Poland would have a
                       ism in the economies of each of the EU        Commerce, among others, in business            much higher chance of realising its as-
                       member countries. A break in the EU           confidence surveys, which conclude              pirations of being among the most im-
                       economic solidarity can considerably          that Poles, remaining one of the biggest       portant economies in Europe, and re-
                       slowdown the process of eliminating           optimists in Europe when it comes to           moving disparities in the wealth of its
                       differences among EU countries. This           performance in turnover, sales, exports        citizens.                             ::

                                                                                                                              2/2011 :: polish market ::   55
 Invest in Poland




Poland should be like
Sławomir Majman, President of the Polish Information and Foreign
Investment Agency (PAIiIZ) talks to Rita Schultz.



                                                                       Poland coped with the global cri-
                                                                       sis better than any other European
                                                                       country. Does this have any direct
                                                                       impact on the growth of invest-
                                                                       ments in our country?
                                                                   As it turned out, Poland really be-
                                                                   came a relative winner of the world
                                                                   crisis and already at the beginning of
                                                                   2010, we began to note that we have
                                                                   an extremely scarce commodity to
                                                                   offer post-crisis Europe. Th is scarce
                                                                   commodity is economic stability. As
                                                                   a result, many fi rms that did not even
                                                                   think of planning investments in Po-
                                                                   land suddenly began to take an in-
                                                                   terest in our market. At this moment,
                                                                   the portfolio of orders and projects
                                                                   run by foreign investors in 2010 to-
                                                                   tals over 144 projects. There were 80
                                                                   less a year before.
                                                                       You can say that as a result of the
                                                                   crisis, Poland became fashionable. Of
                                                                   course, we do not want this popularity
                                                                   to last only one season. We want Po-
                                                                   land to be popular like Channel nº5,
                                                                   for years.

                                                                       Which countries are most inter-
                                                                       ested in Poland, since much is be-
                                                                       ing said about the invasion of Asian
                                                                       capital?
                                                                   Yes, an Asian comeback did take place,
                                                                   mainly of Korea, which took the fourth
                                                                   place among foreign investors in Po-
                                                                   land in 2010. An important player is
                                                                   also Japan but, above all, it is the Unit-
                                                                   ed States that dominates. At this mo-
                                                                   ment, the structure of investment by
                                                                   geographic origin in Poland is such that
                                                                   more than 30% of the investment in
                                                                   2010 was from American capital, then
                                                                   British, German, Korean and French
                                                                   one.

                                                                      The Asians are in the fourth place.
                                                                      What about fascination with coun-
                                                                      tries such as China or India?
                                                                   A bit of sobriety will do us good.
                                                                   Both China and India, and from our

56 ::   polish market :: 2/2011
                                                                                                                         Invest in Poland




Channel no 5
                                                                 Almost 60% of new investments in 2010 were investments
                                                                       in the intellectual business. Hence, the sectors that
                                                                                      require a highly educated workforce.


perspective, also Russia, are countries     stopped being an attractive market,            How do you asses the present cli-
of the so-called second class. We can-      since with this type of investment it          mate for foreign investments?
not count on serious investments from       is low cost labour that counts most.       The perception of Poland in the world
these countries for another 3-4 years.      We are not the cheapest in Europe,         as a place to invest has improved in a
    We can, on the other hand, count        which is something that we should          very significant way over the last year
on South Korea to be a serious inves-       be happy about. And hence, the sim-        and a half. We soared in all the rank-
tor in the coming years. We closed          plest investments, fast trained staff, a    ings. We managed to convince inves-
three serious projects in 2010: Sam-        giant production line, repetitive tasks,   tors that Poland is a favourable in-
sung, Ricoh and Korea Fuel Tech. All        these investments will sooner fi nd         vestment location because, fi rst of all:
Asian projects gave us around 1,200         their way to Romania or Bulgaria or        we have stability, secondly: one in 10
jobs in 2010.                               countries such as Slovakia, where the      students in Europe is a Pole, hence we
    In reality, however, when it comes      government will support investors fi-       have the appropriate human resources
to potential, China is our future hope.     nancially regardless of anything, than     at our disposal to handle complicated
One should remember that in China           to Poland.                                 processes. And thirdly, the legal sys-
capital follows politics. At this mo-                                                  tem is constantly becoming friendli-
ment, Chinese capital is in fact flowing         What are the most popular sectors      er. In practice, when we ask foreign
to Greece and closer to us – to Romania         among investors?                       investors in surveys about the legal
and Bulgaria. Th is is consistent with      If we’re talking about sectors, then       and tax systems in Poland, they are
the tactic that the Chinese have test-      the leader in investment is the auto-      generally evaluated much better than
ed in Africa, namely, support weaker        motive industry. And this does not         what Polish businessmen would im-
economies and, with the help of mon-        concern automotive production at all,      agine. In principle, the tax law is not
ey, gain a strong position, including       only supplying the automotive indus-       a subject of criticism at all. When it
a political one. The Polish economy         try. Centres for business services at-     comes to corruption, it turns out that
is simply too strong. We assume that        tract a lot of interest. Over the last     we are the least corrupted country in
the next country where the Chinese          several years, investments have gone       the entire Central & Eastern Europe-
capital will become very active will        into, among others, bookkeeping cen-       an region. When it comes to impedi-
be Hungary. The Chinese economy is          tres and call centres. In effect, Poland    ments, besides the two principal areas,
ever more quickly becoming a knowl-         has become one of the principal places     construction law and the law on pub-
edge-based economy.                         where multinationals place their re-       lic procurement – vague and compli-
    In India the situation is entirely      gional or global marketing and logis-      cated, the rest of the legal framework
different. Namely, the flagship of the        tics centres, fi rms such as IBM, HP,       that investors deal with is evaluated as
Indian economy, ArcelorMittal, is al-       Fujitsu, etc. We have 25 such projects     being mostly decent. Even our public
ready an important player for Poland.       this year.                                 administration is positively evaluat-
We opened another ArcelorMittal in-             In third place is the machine-build-   ed by foreign investors.               ::
vestment in 2010, in the Polish steel       ing industry, with an emphasis on
industry, and others are already in         household appliances. And then there
the works. And there are no political       is the energy sector and aerospace sec-
issues here. The difficulty is that Po-       tor.                                        Sławomir Majman
land is still a distant country for Indi-       Almost 60% of new investments in
an businessmen, also mentally.              2010 were investments in the intellec-      President of the Board of Polish Information and Foreign Invest-
                                            tual business. Hence, the sectors that      ment Agency and Commissioner General of the Polish Section
    Does this mean that we are exotic?      require a highly educated workforce.        of the World Exhibition EXPO 2010 in Shanghai. Former CEO of
Maybe not so much, but it is much           We have that workforce, we have can-        Warsaw Exhibition Board. Head of Managers Association in Po-
easier to convince an Indian investor       didates for white-collar workers, the       land, President of Interexpo Association in the Hague. Gradu-
to invest in England than in Poland.        situation is a little worse with blue-      ate of the Moscow State Institute of International Relations and
    I think that we should forget about     collar workers. If there is a shortage      Postgraduate Studies in Organization and Management. Author
giant automotive production lines           of workers in Poland, it concerns em-       of around 800 articles published in press. He speaks 3 foreign
in Poland and thousands of work-            ployees at the level of technicians and     languages: English, Russian and Czech.
ers standing beside them. Poland            skilled labourers.

                                                                                                                         2/2011 :: polish market ::   57
 EURO 2012



  The National Sports Stadium




The construction of the National Stadium in Warsaw is to be completed                                        Rafał Kapler
on June 30, 2011. The opening game of UEFA EURO 2012 will take place                                         president of the National Sports Centre

in Warsaw on June 8, 2012. The National Stadium will be the site of six                                      The National Stadium in Warsaw is
tournaments: three group games, the opening game along with the official                                       being built after Poland won the bid
                                                                                                             to co- host the EURO 2012 Football
inauguration ceremony, a quarter final and a semi-final.                                                       Championships. However, its des-
                                                                                                             tination is by no means limited to
                                                                                                             EURO 2012. Even before the start
                                                                                                             of the event, the National Stadi-
                                                                                                             um will serve as a multifunction-
                       INFRASTRUCTURE                                                                        al facility. It will be the site of sport
                                                                 way include the construction of sports      tournaments, concerts, big shows
                       Andrzej Bogucki                           stadiums, airports, railway stations as     and mass events as well as fairs,
                       Management Board member of the PL2012     well as major road and railway routes       congresses and business events. It
                       Company responsible for Infrastructure    that are of key importance for organ-       will serve as a conference centre
                                                                 ising Euro 2012.                            and office facility.
                           What has been the major accom-                                                        A number of big sports and mu-
                           plishment so far in preparing Po-         What has been the greatest chal-        sic events as well as big perform-
                           land for EURO 2012 as far as infra-       lenge in preparing the infrastruc-      ances are scheduled to take place
                           structure is concerned?                   ture for EURO 2012?                     soon after the construction of the
                       The most important one in Poland’s        Combining the development of sports         Stadium is completed. So far Po-
                       on-going preparations for Euro 2012 is    and transportation infrastructure with      land was lacking such a modern
                       that nearly one year and a half before    ensuring good organisation. The suc-        facility as the National Stadium in
                       the championships are due to start,       cess of the championships and that          Warsaw. Its presence will open up
                       work on 80% of the 81 infrastructure      also in quality terms will no doubt de-     many new opportunities.
                       investment projects, which are most       pend not only on how well the infra-
                       important for organising the event, has   structure is prepared. It will also de-     :: Total area of the facility:
                       reached a far advanced stage. Moreo-      pend on how properly transportation,           203,920 sq m,
                       ver, 82% of these projects are carried    services for sports fans in public plac-    :: seating capacity: 55,000 in the
                       out in accord with the approved time-     es and medical care facilities are or-         stands
                       table and some have already been com-     ganized as well as on how effectively        :: including 4,600 premium seats,
                       pleted. Poland has scored very well       safety conditions are ensured for the       :: over 800 seats in VIP boxes,
                       in its preparations and has received      one million football enthusiasts who        :: 69 VIP boxes,
                       high praise for that from UEFA offi-        will visit Poland during the EURO 2012      :: size of the site of the stadium: 18 ha.
                       cials. The investment projects under      championships.                         ::

58 ::   polish market :: 2/2011
                                                                                                           Regional development



We carried out all our plans
for last year
“2010 was another year of extraordinary increases in leveraging European Funds. While the Council of
Ministers had anticipated the invoices we would send to the European Commission to amount to nearly
PLN 27 billion, at the end of the year our certified expenditure was PLN 35.7 billion. This means that the
target figures were exceeded by about PLN 9 billion – 132.6% of the plan. Our budget has already received
PLN 6 billion of the surplus amount and PLN 2 billion will be transferred in the first months of this
year. I believe there’s no need to stress how much it means to our economy,” said Elżbieta Bieńkowska,
the Polish Minister of Regional Development.



Poland has already received EUR 15.3 billion in re-            – we assume it will be PLN 48 billion.      PLN 68 billion at their disposal this
funds from the European Commission, which is more than         The largest refunds will come between       year. Between 2011 and 2012 the road
the total of all seven countries behind it. Refunding is the   2012 and 2014.                              construction programme has a guar-
fi nal phase of the implementation of EU funds. About EUR           It’s not true that the funds for road   anteed amount of PLN 79 billion in the
40 billion is already working on the market, and soon, af-     projects may go to waste. The Ministry      budget, while the midyear certifica-
ter agreements have been signed, an additional EUR 20 bil-     of Regional Development and all oth-        tion level for the OP “Infrastructure
lion will arrive. The funds flowing to Poland stimulate our     er ministries spending EU funds have        and Environment” amounts to PLN 20
economy, provide opportunities for activity to our entre-                                                                              ADVERTISEMENT

preneurs, generate tax revenues and create new jobs. It’s
hard not to appreciate it considering the present situation
in Europe.
    As for the regions, the “stimulus” we had introduced in
the form of the National Performance Reserve has been do-
ing great. The additional EUR 512 million to share among
provinces encouraged them to implement European Funds
more efficiently. Not only all of them surpassed the spec-
ified 20% certification threshold for the EC (a year ago
it was 4.3% on average, today it is 26%), but the pace at
which contracting is proceeding is just amazing. There are
provinces that have already concluded 95% of their agree-
ments. Th is means that for them European Funds are prac-
tically exhausted and it is not good news for the benefici-
aries. The great news, though, is that it is these provinces
that will receive the most funding from the National Per-
formance Reserve.
    The fi nal ranking will be published in late January/ear-
ly February, but from the outset, fi rst place has been occu-
pied by the Opolskie province. It will be receiving over EUR
50 million, while the last province in the ranking rough-
ly EUR 9 million.

All plans approved in 2010 were successfully carried
out. 2010 was the fi rst year with such fast dynamics in the
implementation of projects (particularly in transport and
energy sectors), which were mainly subsidised from the
Operational Programme “Infrastructure and Environ-
ment.” Large projects characteristically need a long time to
be implemented and to gather pace, so their dynamics and
funds spending are expected to be even greater this year

                                                                                                                    2/2011 :: polish market ::   59
 Regional development


billion, from which the infrastructure     budget of the EU. Poland has been
sector will receive PLN 15 billion this    very active in discussions concern-
year. Th is means that not only there is   ing the future of the Cohesion Policy
no risk of losing the funds, but, with     and of the EU funds after 2013 (on 18
the results achieved and the obtained      August 2010 the position of the gov-
levels of contracting and refunding        ernment on the future of the Cohe-
from the EC, it is impossible that the     sion Policy was approved). Obvious-
EU funds will not be leveraged, even       ly, this takes place in various fields,
in a longer prospect!                      currently in the most important one,
    The minimum target expendi-            the field of fi nancing, because we fi rst
ture (cumulatively, without the pro-       have to secure the suitable level of it.
grammes from the European Ter-             We want to prepare the ground for a
ritorial Cooperation), calculated as       debate on fi nancial issues for the years
expenditure declared to the Europe-        2014-2020.
an Commission from the time pro-               The “EU-2020” strategy has three
grammes were launched to the end           goals – it is to be “smart” - innovative,
of 2011, is nearly PLN 92.3 billion.       “sustainable” - conducive to sustain-
We plan to certify expenditure in the      able development and “inclusive” -
amount of almost PLN 40 billion.           counteracting social exclusion on la-       Up to 31 December 2010, Poland received EUR 15.281 billion from
                                           bour markets. No other instrument,          the European Commission (EUR 6.223 billion in the form of ad-
Extremely important to both the            no other EC policy, can achieve these       vance payments and EUR 9.048 billion as a refund), according
Ministry of Regional Development           goals simultaneously. That is why, es-      to data from the Ministry of Regional Development. In 2010 Po-
and the government is the “Nation-         pecially during the Polish Presiden-        land received over EUR 6.6 billion of refunds.
al Strategy for Regional Development       cy of the EU, we want to show how                157,900 formally-correct applications were submitted for the
2010–2020: Regions, Cities, Rural Ar-      the implementation of cohesion poli-        total amount of subsidies (both EU funds and national funds) of
eas” (KSRR) passed by the Council of       cy in Poland and other countries con-       PLN 366.1 billion, since the launch of the programmes to 26 De-
Ministers in July 2010, and the relat-     tributes to achieving these goals, and      cember 2010. At the end of 2009 these figures were 100,400 and
ed schedule for its implementation,        how much added value it holds for Po-       PLN 232.2 billion respectively.
which was approved last autumn. Th is      land and Europe. We want to persuade             Until 31 December 2010 50,459 contracts were signed with
is the fundamental document defi n-         other member states, many of which          beneficiaries for subsidies totalling to PLN 154.4 billion, partial-
ing the government’s activities in the     fi nd themselves in a critical econom-       ly from EU funds, which constitutes 58% of the allocation for
field of investment in the regions and      ic situation, to continue implement-        the years 2007-2013 (at the end of 2009–25,786 contracts for the
the way the regions are treated. It is a   ing this policy.                            amount of EU subsidies of PLN 68.1 billion, i.e. 25% of allocation).
revolutionary document as nothing                                                      The value of eligible expenditure shown in contracts for subsi-
comparable to it has been published        It is too early to discuss details, such    dies amounted to PLN 223.4 billion (by the end of 2009 the total
before - a document that shows that        as whether there will be more repaya-       value of contracts signed was PLN 108.8 billion).
the government, which cares about          ble elements (loans) or subsidies; more          The value of the beneficiaries’ expenditure as seen in sub-
the equal and accelerated develop-         tenders or indicative lists. We need to     mitted payment notions was PLN 64 billion (by the end of 2009
ment of the country, wants to support      know how much funding we are go-            - PLN 20.2 billion). The value of EU subsidies according to pay-
all Polish regions, especially by taking   ing to receive.                             ment applications was PLN 46.4 billion, which constitutes 17.5%
advantage of their own potential, their        During the Polish Presidency that       of the allocation for the years 2007-2013 (by the end of 2009 PLN
own initiatives, creativity and vitali-    will start in 6 months, we will be dis-     15.3 billion, 5.6% of the allocation).
ty. It does not forget about the weak-     cussing and negotiating EU regula-               The EC expenditure certification target approved for 2010 was
er areas, and they will receive addi-      tions that are to specify how much          nearly PLN 27 billion with reference to national and regional pro-
tional funding.                            funds will be spent, in what way,           grammes, and EUR 21.373 million for the programmes of Euro-
                                           and on what. We need to do this in          pean Territorial Cooperation. As of 31 December 2010, PLN 35.7
The KSRR is a very important de-           stages, but, as can be understood           billion had been certified (132.6% of the target for 2010) within
velopment, not just for the process of     from EU documents, there will be            the framework of national and regional operational programmes
strategic management of the country,       more repayable instruments, and few-        and EUR 23.9 million (111.8% of the target) in ETC programmes.
but also as a change in the approach       er subsidies. Currently subsidies con-           As of the end of 2010, from the launch of national and region-
to regional development. It presents       stitute up to 90% of what entrepre-         al operational programmes, the amount of PLN 52.6 billion had
a completely new vision of regional        neurs are receiving, but in the near        been certified within the framework of national and regional
policy, one that takes into account the    future they may make up about 60 or         operational programmes, which constitutes 120% of the cumu-
needs of various types of regions. Over    50%. Please do not attach too much          lative target for expenditure up to the end of 2010. In the case
two hundred loosely-related strategic      importance to these numbers. We will        of ETC programmes, EUR 27.5 million have already been certi-
documents will, after a process of ver-    know everything next year.                  fied, which means that 110.1% of the cumulative target has been
ification, become nine well-ordered                                                     achieved. The cumulative target for the certification of expendi-
sector strategies, and the KSRR is the     A statement given during a press confer-    ture by the EC approved for implementation until the end of 2010
fi rst to have been passed.                 ence (4 January 2011)                       amounted to PLN 43.804 billion with reference to national and
    The strategy will also form the                                                    regional programmes, and EUR 25 million for ETC programmes.
basis for the planning of the future             Written down by Jerzy Bojanowicz


60 ::   polish market :: 2/2011
                                                                                                               Regional development



Clusters – cooperation
for competitiveness
Clusters are defined by OECD as geographic concentrations of interrelated                                       majority of fi rms are presently focus-
                                                                                                               ing on their key competencies, con-
enterprises and institutions in a given line of business. Physical proximity                                   tracting side activities out to suppliers,
intensifies the flow of information and hastens the development of                                               on the basis of outsourcing, for exam-
                                                                                                               ple. Also, frequently, fi rms are forced
institutions, which increases the effectiveness of the cluster. A cluster can                                   to implement various projects in con-
contain a small or a large number of enterprises of different size classes.                                     sortiums, since they are not able to ex-
                                                                                                               ecute them alone. Th is requires inter-
Formal institutions, such as universities, are an integral part of clusters.                                   organisational bonds based on trust
The agglomeration of firms and suppliers allows the development of locally-                                     and profit sharing. Nowadays, com-
                                                                                                               petition is a game where both part-
concentrated and sometimes specialised labour markets.                                                         ners can profit, and the goal is to create
                                                                                                               additional value. In the Competitive
Elżbieta Wojnicka, PhD                                                                                         Diamond, defi ned by Porter, the de-
                                                                                                               mand for certain products in a given
                                                                                                               region is also important. For example,
                       The “clustering” process intensi-          terms of international competitive-          it will be difficult to develop a high-
                       fies the division of labour between        ness. Th anks to this, a once poorly         tech fi rm in a society with a low tech-
                       neighbouring companies and compet-         developed region of Italy, Friuli-Ven-       nological awareness, and that is why
                       ing producers, thus stimulating in-        ezia Gulia, became one of the richest.       such fi rms mainly develop in agglom-
                       novation. Clusters shape themselves        Michael Porter, forming the develop-         erations, where institutions of higher
                       spontaneously in the presence of cer-      ment policy for the USA, showed that         education are present.
                       tain conditions: market proximity,         competitive regions are those, which
                       availability of a specialised workforce,   can ensure the presence of competi-          Clusters develop and are sup-
                       availability of material and equip-        tive clusters on their territory, not only   ported by all countries who want to
                       ment suppliers, availability of specific    of a given industry, but also of its sup-    be competitive internationally. Ac-
Elżbieta Wojnicka,     natural resources and infrastructure,      pliers – related industries, support-        cording to the 2003 Cluster Initiative
PhD, lecturer at       low transaction cost due to the geo-       ing institutions such as education-          Greenbook, the most common goals of
the Institute of
                       graphic proximity of individual enti-      al and research institutions, thanks         cluster initiatives in developed coun-
Organisation and
Management of
                       ties and access to information, which      to which employees are present in a          tries are a growth of innovation and
the University of      improves particularly in the presence      given area having the qualifications          improvement to the business envi-
Gdańsk, expert         of universities and research institu-      required by these fi rms. Competing           ronment, while in developing coun-
and consultant on      tions. In certain cases, fi rms may de-     territories, regions, and, thanks to         tries and transforming countries, they
innovation, regional   cide to base their cooperation on for-     them, also countries, are those econ-        are growth in value added, exports and
development            mal agreements, in order to simplify       omies that also care about regulations       improvement in innovation. In many
and European
                       the exchange of information. In the        supporting the growth of enterpris-          countries, such as Austria or New Zea-
integration. Author
of expert reports,     case of clusters, it is important that     es, e.g., those concerning their cre-        land, cluster promotion has been an
among others, for      enterprises cooperate only in certain      ation. An appropriate organisational         export support instrument. Especial-
OECD, Industrial       areas, such as exports, trade, innova-     culture and management are also im-          ly for small and medium enterprises,
Development            tion, procurement, marketing, em-          portant. For example, Japan’s success,       it is important to organise expansion
Agency, Polish         ployee training, while still remain-       and that of many fast-growing South-         outside of the country together, which
Agency for
                       ing independent entities.                  Eastern Asian countries following in         will reduce high operating costs relat-
Enterprise
                           The concept of clusters as instru-     its tracks, resulted from the ability        ed to market studies and promotion in
Development, the
Ministry of Regional   ments for supporting economic de-          to create appropriate organisational         foreign markets. For example, in the
Development and        velopment is based on observations         bonds with the enterprises’ surround-        mechanical tool industry in Banga-
Province Chairmen’s    already made during the nineteenth         ings, thanks to which, they function         lore, India, encompassing 56 fi rms,
Offices.               century, regarding the characteris-        in stable, predictable systems, which        nine export consortiums have devel-
                       tics of location decisions of fi rms and    can be trusted. Th is organisational         oped. These consortiums undertook
                       institutions related to a given sec-       culture is stimulated by, among oth-         common actions related to export,
                       tor. After WWII, industrial districts,     er things, clusters, while its necessity     such as creating common brochures,
                       i.e. small and medium enterprises,         arises out of changing operating con-        establishing common marketing of-
                       working together in certain areas in       ditions of fi rms who are having trou-        fices and sales agents, creating com-
                       Italy, have achieved great success in      ble competing singlehandedly. The            mon internet sites, issuing common

                                                                                                                         2/2011 :: polish market ::   61
 Regional development


                                            Politicians should be aware that supporting clusters can increase
                                            productivity, the level of innovation and competitiveness of cluster firms.
                                            Policies supporting clusters have several general characteristics: require
                                            a movement from focusing on individual firms to local/regional systems
                                            of firms and the value added created by the firms for the local/regional
                                            environment.


magazines and participating in in-          and build a strong international po-       great popularity. Presently, due to a
ternational trade shows together. In        sition of the Pomeranian ICT branch,       shortage of other funds, it should be
Finland and Japan, the main develop-        obtain EU subsidies for training, re-      expected that fi rms will rise above
ment direction for clusters is to cre-      search and infrastructure projects; in-    their reservations and, together with
ate bonds with R&D units and educa-         fluence the direction of education in       educational institutions, will begin
tional institutions. In this way, centres   Pomeranian educational institutions,       cooperating and propose interesting
of excellence and advanced technolo-        influence the regional and national         projects for common development,
gy are developing. Drawing education        policy regarding the development of        which they will be able to finance from
and business together leads to creation     ICT in Poland, common procurement,         EU funds. Today’s competition shows
of technology at educational institu-       optimal infrastructure management,         that team action has a greater chance
tions, which then can be commercial-        human resources and their utilisation.     for success than the actions of an indi-
ised, and enterprises can, for example,     In order to create a common brand and      vidual fi rm. At the same time, cooper-
use specialized equipment in common         to commonly realise orders, ICT clus-      ation at the cluster level stimulates the
laboratories, which they could not sin-     ters such as the Podkarpackie Region       appearance of external benefits, ac-
glehandedly afford.                          IT Cluster sprung up on the base of the    celerating regional development. In-
    In recent years in Poland, many         Podkarpackie IT Association, which is      ternationally competitive clusters, in
initiatives have been implemented,          how the developing initiative from the     a given area, also tend to cause com-
mainly those supported by funds from        Warmińsko-Mazurskie region wants           panies from around the world to want
the European Union, whose aim has           to function. Initiatives related to re-    to locate there and for prominent spe-
been to stimulate cluster development.      newable energy are also developing,        cialists to want to work there, of which
Most of them engaged both enterprises       such as the Nadwiślański Renewable         the world’s most famous cluster, Sili-
and educational institutions. Clusters      Energy Cluster, or the Green Stream        con Valley, is an example.
spring into existence both in tradi-        Cluster. Actions are undertaken in the         Politicians should be aware that
tional industries, such as the Ecologi-     Podkarpackie region for a health re-       supporting clusters can increase pro-
cal Food Valley in Lubelskie, as well as    sort cluster and, in the Warmińsko-        ductivity, the level of innovation and
high technology branches, especial-         Mazurskie region, a wood processing        competitiveness of cluster fi rms. Pol-
ly ICT. Cooperation in the Ecological       – furniture cluster is in operation. In    icies supporting clusters have sever-
Food Valley cluster is based on having      the Podlaskie region, research is un-      al general characteristics: require a
a share in creating a common product        derway for the possibility of creating     movement from focusing on individ-
offer and promotion using the associa-       trans-border clusters. The Clusters        ual fi rms to local/regional systems of
tion’s logo. The main forms of promo-       Benchmarking in Poland report, pre-        fi rms and the value added created by
tional activity include: maintaining        pared for the Polish Agency for Enter-     the fi rms for the local/regional en-
an internet site with links to inter-       prise Development, covers 47 clusters.     vironment. A cluster support policy
net stores and site of other “Valley”       However, it does not present a full pic-   also attempts to stimulate social co-
participants, issuing common pro-           ture of clusters in Poland, due to the     hesion, based on interaction based on
motional materials, participation in        fact that, some of the initiatives did     trust, to increase the flow of knowl-
trade shows and fairs. Also, as part of     not agree to participate in the study.     edge. Public administration should
cluster activity, meetings are organ-                                                  also work in the interest of creating
ised with themes related to ecological      Cluster initiatives are supported          an environment that is conducive to
foods and leading a healthy lifestyle.      by funds from the Regional Opera-          cluster development, relying on their
Research is conducted for the cluster       tional Programmes, the Operational         own means.                              ::
with the participation of scientists and    Programme Development of Eastern
students. Students have field studies        Poland, and the Innovative Economy
and internships in the cluster, write       Programme. The majority of structural
projects and Master’s thesis, and are       funds, in their editions for 2007-2013,
also starting to become employed by         have already been exhausted, with
the enterprises. A cluster that stands      the exception of funds for cluster in-
out in the area of ICT is the WICOMM        itiatives. Due to complicated expec-
initiative, whose leader is the Gdańsk      tations and procedures, and the low            In recent years in Poland, many initiatives have been
University of Technology. The goal          maturity of many cluster initiatives        implemented, mainly those supported by funds from the
of this cluster is to activate and ani-     in Poland up to now, funds for clus-       European Union, whose aim has been to stimulate cluster
mate cooperation between ICT fi rms          ters, i.e. Innovative Economy Opera-          development. Most of them engaged both enterprises
in the region, increase the potential       tional Programme, have not enjoyed                                     and educational institutions.

62 ::   polish market :: 2/2011
                                                                                                             Regional development


Sufficient income needed
to benefit from tax breaks
Paweł Barański, tax adviser and                    benefit from the breaks. Now, when the year
director at the Katowice office of the               2016 is no longer a distant future, there are
                                                   more fi rms able to say for sure they will not
professional services firm KPMG, talks
                                                   use the breaks to the full. Is this a normal sit-
about tax break problems encountered               uation? Well, such situations do take place.
by investors in special economic zones             There is nothing exceptional about it. It seems
and ways of solving them.                          that when a manufacturer decides to open a
                                                   factory in a special economic zone it is best       arouses many questions: whether only paid
                                                   to make there products which are in demand          expenses should be taken into account or also
                                                   and have the highest margins. And this is the       accrued expenses. And if only paid expens-
                                                   case with many companies. But the problem           es are taken into consideration, then should
     We learn from a KPMG report that almost       is capital intensity. It is easier for a compa-     they be discounted since the moment when
     30% of investors in special economic zones    ny which has invested PLN50 million to get          they are incurred or since the moment when
     are going to use tax breaks to the amount     back 40% of the invested amount in the form         the fi xed asset is put into use? How to account
     of less than 50% of what they are poten-      of tax breaks because 40% is worth only 20          for a loan and interest on a loan? How to in-
     tially entitled to. Does this mean that in-   million in this case. But if a company has in-      clude exchange rate differences from such a
     vestors have problems with the interpre-      vested 0.5 billion 40% is worth as much as 200      loan into eligible expenditure? As a rule, the
     tation of who is entitled to the breaks?      million. It is a huge amount and in order to get    investor has the right to deduct 40% or 50%
No, this is not the case. Investors know that      the money back the investor would have to           of their investment spending from income
they are entitled to the breaks but they re-       generate more than PLN1 billion in net profit.       tax. But the exact amount needs to be care-
port problems with calculating the actu-                                                               fully calculated because if the investment is
al amounts. As a rule, they know they are              But investors themselves report they have       worth 100 million, for instance, the amount
entitled to deducting 40-50% of their in-              the greatest problem with interpreting tax      may as well be 39.2 million and 41.1 million.
vestment spending from income tax. Firms               break regulations. They mention problems        These nuances and doubts pose difficulties.
that have very capital-intensive investment            with separating expenditure from reve-
projects and operate on very slim margins              nue in the second place. What are these             Can anything be done about it?
do not benefit from the breaks. Most of the             problems?                                       Of course, there are tax advisers who have
fi rms that operate in the special econom-          A single provision in the law on corporate          specialised in economic zone problems for
ic zones are manufacturers while those en-         income tax regulates tax breaks so in theo-         more than 10 years now. The experience of
gaged strictly in trade are not allowed to op-     ry everything should be very simple. The tax        such advisers, including KPMG, is invaluable.
erate in the zones. Meanwhile, it is the latter    breaks apply to income from economic ac-            We have provided services to fi rms operat-
that usually operate on high margins while         tivity conducted in special economic zones          ing in special economic zones for more than
the manufacturers’ margins are lower. As a         by businesses which have received operat-           10 years and are now familiar with virtual-
result, if an investment project is very capi-     ing permits. Problems arise because, apart          ly all the problems that may be encountered.
tal intensive and the margin on the products       from the core businesses described in their         In most cases, we can solve them. I must say
sold by the fi rm is not high the fi rm does not     permits, companies also conduct other ac-           that there are problems where there is no
use public aid because its income is too low.      tivities, like for example auxiliary and fi-         single clear-cut position on how to deal with
An additional factor is that the crisis of two     nancial activity. And then, they have to de-        them. But in such cases, we can always rely
or three years ago had significantly affected        cide whether they are eligible for the tax          on the European Commission’s guidelines on
some sectors. Th is is probably why our re-        break on this auxiliary or fi nancial activity.      state aid and we will always be able to fi nd a
search produced such fi ndings. The fi ndings        There is no problem if income from such ac-         safe solution for the investor. It is worth us-
are also confi rmed by our practice. Firms          tivity is low. In such cases, investors usual-      ing the services of experienced advisers to
operating in special economic zones are our        ly decide to pay the full amount of tax. But        avoid problems. Our experience shows that
clients and we know that some of them use          if the income is high because, say, the com-        many businesses starting activity in an eco-
the tax breaks very efficiently while others         pany has entered the fi nancial instruments          nomic zone adopt the following attitude: “For
do not. Many of the fi rms already know they        market, which was quite popular a few years         the time being, we deduct everything, we
will not be able to use the break to the full      ago, then paying the full amount is painful         have spent around 40 million, for five years
whether the zones continue to operate un-          and the investor tries to check regulations,        we do not need to worry.” But the problem
til 2016 or 2020.                                  interpretations and EU guidelines to fi nd out       arises at some point: “How much of it do we
                                                   whether the income is indeed taxable. There         actually have?” Then, the amount has to be
    Which means the research fi ndings come         appear doubts as to how the amount exempt           calculated accurately. Since this has to be
    as no surprise?                                from tax should be calculated. As a rule, the       done for several years back, problems appear
In fact, they are a bit surprising. When more      amount is calculated on the basis of expenses       with contracts, invoices, transfers and so on.
than 10 years ago investors started their ac-      incurred to buy or generate fi xed assets. And       The sooner the investor plans how to divide
tivity in the zones, everyone hoped to fully       again we have to do with a situation which          revenues and expenses, plans appropriate

                                                                                                                        2/2011 :: polish market ::   63
  Regional development
accounts in books for taxable and non-tax-                         something after many years – this causes the                            Of course. It is possible if the company has
able revenue and expenditure, and adjusts                          greatest confusion. It is best to have every-                           not been generating only losses ever since it
the books to the proper calculation of eligi-                      thing prepared before incurring the fi rst el-                           started activity in the economic zone and if
ble expenses, the better. If the investor does                     igible expense. I can assure you that in such                           it is only an accounting problem or the ques-
so right at the beginning they will certainly                      a case problems will be brought to a mini-                              tion of putting things in order. In this case,
not be among those who report accounting                           mum or will not exist at all.                                           the investor may be sure that much of the el-
problems. If certain rules are adopted and                                                                                                 igible amount will be recovered. Of course,
adhered to expenses will be accounted for                             Can investors who have not yet used the                              the company needs to be sufficiently profit-
correctly and individual accounts will be en-                         tax breaks hope to be able to do so after                            able because it has to generate income to be
tering non-taxable or taxable income. Prob-                           many years if they ask a tax adviser for                             able to benefit from the tax break.
lems arise when investors want to correct                             assistance?                                                                        Interviewer: Sandra Wierzbicka




Investors are very impressed with
Polish special economic zones
                                                                                    in the form of exemption from income                          preparation of investment land and
                                                                                    tax and from property tax.                                    the cooperation of local authorities
                                                                                        Together with the onset of the cri-                       (74%). What is more, 92% of investors
                                                                                    sis, the slowdown in the economy did                          do not regret making the decision to
                                                                                    not spare the economic zones. How-                            start their business in an SEZ, stating
                                                                                    ever, the economic crisis turned out to                       that the decision was “right” (62%), or
                                                                                    be less serious than expected. In 2009,                       “somewhat right” (30%). Additionally,
                             Special economic zones (SEZs), se-                     131 permits were issued for running                           it should be noted that as many as 44%
                             questered and non-inhabitable areas                    a business, which is a 36% decrease                           are of the opinion that the attractive-
                             of the country, where business activ-                  in comparison to 2008. Despite this,                          ness of the zone they are in will sys-
                             ity can be conducted on preferential                   the size of invested capital fell only by                     tematically continue to increase. Ac-
                             conditions, were created to encour-                    7%, however, total employment in the                          cording to the subjective evaluation of
Fig. 1 Would you
recommend doing              age investors to locate investments                    zones fell by 1%. 2010 is assessed to be                      the businessmen, the best zones in this
business in the zone         in particular regions of Poland. There                 much better.                                                  edition of the survey were the Kato-
that you are in to           are 14 zones in Poland, and the fi rst                      Investors are more frequently un-                         wice and Łódź zones (95% positive
your contractor or           was created in 1995. Preferential con-                 derlining their approbation for func-                         ratings). Further along were the Sta-
business partners?           ditions for running a business in the                  tioning in an SEZ. Only 4% of them                            rachowice and Wałbrzych zones. It is
 Yes
                             SEZ mean the possibility to use public                 gave a negative rating to the zone in                         worthwhile to also point out the pro-
 Rather yes
                             support, but the condition is the in-                  which they do business. The highest                           pensity of the businessmen to under-
 Rather no
 No                         vestment of a certain sum of money                     rated was the provision of necessary                          take new investments. As many as 71%
Source: Analysis by          and maintaining a certain level of em-                 utilities (83% of positive ratings). Not                      of investors from the Pomorze zone are
KPMG in Poland               ployment. Public support is awarded                    far behind (78%) was the rating for the                       interested in a new investment on its
                                                                                                                                                  area in the nearest 2-3 years. A high
                                       34%                                    33%                            22%                     11%
                                                                                                                                                  percentage of positive responses was
    kamiennogórska
                                                                                                                                                  also noted in the Łódź, Kraków and
           katowicka                                         67%                                                        33%
                                                                                                                                                  Legnica zones.
kostrzyńsko-słubicka                   39%                                           39%                                  22%
                                                                                                                                                      When it comes to the next sever-
          krakowska                    33%                                                 56%                                       11%          al years, further growth of the zones
             legnicka                  33%                                              56%                                          11%          is expected. 90% of investors would
               łódzka                                        69%                                                   26%                 5%         recommend doing business in an SEZ
            mielecka                                   60%
                                                         %                                            25%                     5%     10%
                                                                                                                                                  to their contractors or business part-
                                                                                                                                                  ners (Fig. 1). According to investor
           pomorska                          43%
                                             4                                                43%                             7%      7%
                                                                                                                                                  declarations, as many as 53% of them
             słupska                   36%                                                 55%                                       9%
                                                                                                                                                  plan to increase employment during
      starachowicka                                  54%                                                    46%                                   the next year.
            suwalska                                   61%
                                                        1                                                   31%                       8%              We should not forget, however,
        tarnobrzeska                     41%
                                          1                                                         59%
                                                                                                      %                                           about problems that would probably
         wałbrzyska                            48%                                                   48%
                                                                                                     4                                 6%         never occur, had a given investor in-
                                                                                                                                                  vested outside an SEZ. Despite that in-
warmińsko-mazurska                     33%                                    40%                                        27%
                                                                                                                                                  vestors are increasing their interests
                        0%      10%      20%           30%         40%      50%        60%           70%          80%          90%         100%   in SEZs, unsolved problems remain.

64 ::   polish market :: 2/2011
We are celebrating our 10th anniversary
We manage an industrial area of 1,240 ha.

We support the development of modern
technologies.

We are developing the Gdańsk Science-Technology
Park by expanding its surface to 40,000 sq m.

We are creating the Baltic Industrial Park offering
new investments possibilities in the former shipyard
grounds in Gdynia.

We offer preferential rules for carrying out
economic activity.

                                                Join us!

9 Wladyslawa IV St., 81-703 Sopot, tel. (+48) 58 555 97 00
        Regional development

   Fig. 2 Sectors with the highest percentage of businesses declaring a full or almost full                                                                                                                                                                                                                                                                                         Fig. 3 Sectors with the highest percentage of businesses declaring a utilization of less
   utilization of the available tax exemption             Source: Analysis by KPMG in Poland                                                                                                                                                                                                                                                                                        than 50% of the available tax exemption               Source: Analysis by KPMG in Poland

               ceramics                                                                                                                                                                                                                                                                                                             54%                                                                                                 automotive                                                                                                                                                                                                                                                              43%

           construction                                                                                                                                                                                                                                                                                  47%                                                                        machines and equipment                                                                                                                                                                                                                                                                 35%

   paper and printing                                                                                                                                                                                                                                                             45%                                                                                                                                                          synthetics                                                                                                                                                                                                               33%

                 metals                                                                                                                                                                                                                                                    41%                                                                                                                 construction                                                                                                                                                                                                                                                          32%

                                                                                                                                                                                                                                             36%                                                                                                                                     information technology                                                                                                                                                                                                                                                         31%
  consumption goods
                                                                                                                                                                                                                                                                                                                                                                                                  and media
                                                 0%                                         10%                                                   20%                                                 30%                                    40%                                               50%                                             60%                                                                                                                                                  0%                                              10%                                     20%                                       30%                                 40%                                   50%                                                                 60%


    Traditionally, the most frequently cited prob-                                                                                                                                                                                           one of the most important ones related to tax                                                                                                                                                                                                                                the construction sector (47%) and paper and
    lem regarding doing business in a zone are le-                                                                                                                                                                                           exemptions. At the other end of the spectrum                                                                                                                                                                                                                                 printing sector (45%). In the ceramics sector,
    gal barriers and additional costs. There is also                                                                                                                                                                                         were investors from the Warmia and Maz-                                                                                                                                                                                                                                      only 15% of companies expect to use less than
    the issue of taxes, and particularly, unused                                                                                                                                                                                             ury zone, among which only 13% indicated                                                                                                                                                                                                                                     50% of the exemption due (Fig. 2). Among all
    exemptions. The most commonly mentioned                                                                                                                                                                                                  the separation of expenses and revenue as a                                                                                                                                                                                                                                  the branches, the least number of entrepre-
    problem is still the interpretation of tax laws.                                                                                                                                                                                         real difficulty. Continuing down the line, the                                                                                                                                                                                                                                 neurs – only 14% - declared a minimal usage
    Th is issue was pointed to by 60% of investors                                                                                                                                                                                           next item identified is the accounting for tax                                                                                                                                                                                                                                of the tax exemption in the metals branch. In
    (51% in 2009). It was most frequently noticed                                                                                                                                                                                            losses (33%) and establishing the exemption                                                                                                                                                                                                                                  turn, the highest number of businesses (43%)
    by respondents from the Legnica (78%) and                                                                                                                                                                                                amount (27%).                                                                                                                                                                                                                                                                who are using less than half o the tax exemp-
    Katowice (76%) zones. However, for investors                                                                                                                                                                                                The degree of taking advantage of the in-                                                                                                                                                                                                                                 tion comes from the automotive sector. In the
    in Suwałki zone, the interpretation of tax laws                                                                                                                                                                                          come tax exemption in special economic zones                                                                                                                                                                                                                                 second place is the machinery and equipment
    was not a major problem (38%). An equally                                                                                                                                                                                                looks differently, depending on the sector in                                                                                                                                                                                                                                 sector (35%) and the synthetic materials sec-
    common issue is the necessity of separating                                                                                                                                                                                              which a given enterprise functions. The un-                                                                                                                                                                                                                                  tor (33%) (Fig. 3).
    taxable expenses and revenue from expenses                                                                                                                                                                                               disputed leader is the ceramics industry, in
    and revenue that is exempt from tax (59%). A                                                                                                                                                                                             which 54% of businesses plan a full or al-                                                                                                                                                                                                                                   Th is material was created on the basis of the
    considerable majority of respondents from the                                                                                                                                                                                            most full (90-100%) utilization of the tax                                                                                                                                                                                                                                   Fifth Anniversary Edition KPMG Report Spe-
    Legnica zone (89%) indicated this problem as                                                                                                                                                                                             exemption. At a forefront position is also                                                                                                                                                                                                                                   cial economic zones 2010 (November 2010)




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              cumulative, per hectare of total area
                        Total number of permits issued for




                                                                                                                                Number of permits issued in 2009

                                                                                                                                                                   Number of permits issued in 2009




                                                                                                                                                                                                                                                                                                                                                                                                                           Investment per hectare of utilised
                                                                                             Growth in the number of permits,




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                A. Sum of “above-average” marks


                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  B. Sum of “below-average” marks
                                                                                                                                                                                                         Total investment, in PLN millions




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          Investment in infrastructure in
                                                                                                                                                                                                                                                                                                                                                                                        Area utilised by investors, % **




                                                                                                                                                                                                                                                                                                                                                                                                                                                                Number of jobs per hectare of
                                                                                                                                                                                                                                                                                                               Change in the number of jobs,
                                                             Number of permits issued per




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          Investment in infrastructure,




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              Investment in infrastructure,
                                                                                                                                                                                                                                             Change in investment, 2008-




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              Change in financial balance,
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          cumulative, in PLN millions




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       Financial balance in 2009,
                                                                                                                                                                                                                                                                                                                                                     Total area of the zone (ha)




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                Investment per employee
                        operations in the zone




                                                                                                                                                                                                                                                                                  Total number of jobs




                                                                                                                                                                                                                                                                                                                                                                                                                           area, in PLN millions




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       in PLN thousands***
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          2009, PLN millions
                                                                                                                                                                   per hectare, %




                                                                                                                                                                                                                                                                                                               2008-2009*




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              2008-2009*
                                                                                                                                                                                                                                                                                                                                                                                                                                                                utilised area
                                                                                             2007-2009
                                                             hectare




                                                                                                                                                                                                                                             2009




As of Dec. 31, 2009
             Weight:      0.5                                  1.0                              1.0                             0.5                                   1.0                               0.5                                    1.0                                0.5                            1.0                                 0.5                               1.0                                    1.0                                 1.0                           1.0                          0.5                             0.5                                  1.0                                    0.5                                    1.0

    kamiennogórska                     41                      0,111                             5,13%                                                 2              0,54%                            1 436,20                                 7,80%                             4 087                        -8,50%                                368,78                           51,13%                                      9,45                                     27                   0,35                            19,20                                  0,00                              0,05                            146,20                            564,55%                                      1,5                              9,5

           katowicka          192                              0,124                         12,94%                                 13                                0,84% 16 025,30                                                        15,80%                              40 724                        -4,40%                              1 544,18                           64,37%                               18,17                                           46                   0,39                      320,90                               33,70                                     0,21                         4039,90                               -54,20%                                     8,0                              3,0

kostrzyńsko-słubicka          106                              0,084                             4,95%                                                 8              0,64%                            3 332,70                                 6,60%                            15 601                        -5,10%                              1 258,33                           62,51%                                      6,77                                     32                   0,21                      123,30                               18,50                                     0,10                         1897,10                               -58,13%                                     1,5                              7,5

           krakowska                   54                      0,102                         42,11%                                 12                                2,27%                            1 564,10                              25,80%                               8 594                    11,60%                                    528,83                           60,49%                                      6,33                                     35                   0,18                            40,60                                  1,60                              0,08                            184,00                             -73,57%                                     4,5                              7,0

             legnicka                  53                      0,116                             0,00%                                                 2              0,44%                            4 257,60                                 5,80%                             8 082                        -7,10%                                457,49                           68,84%                                      18,7                                     35                   0,53                            49,30                                  0,10                              0,11                         1373,90                               -79,16%                                     2,5                              8,0

              łódzka          121                              0,104                         32,97%                                 20                                1,72%                            7 163,80                              23,50%                              20 844                           9,80%                            1 162,30                           63,30%                               10,06                                           29                   0,34                      195,40                               38,90                                     0,17                         7391,60                                           1,68%                   10,0                                     0,0

             mielecka         128                              0,128                         45,45%                                 23                                2,30%                            4 177,10                              10,40%                              15 558                        -1,70%                                998,53                           73,89%                               11,13                                           41                   0,27                      229,30                               22,40                                     0,23                         5206,10                               -41,80%                                     7,5                              3,0

            pomorska                   68                      0,056                             4,62%                                                 8              0,66%                            5 910,10                              59,70%                              19 500                    11,10%                                  1 220,11                           70,88%                                      7,33                                     24                   0,30                      207,50                               16,80                                     0,17                         1336,10                               -94,73%                                     5,0                              4,0

             słupska                   47                      0,117                         14,63%                                                    5              1,25%                                      769,1                          5,60%                             2 383 -12,60%                                                      401,09                           59,93%                                      4,58                                     14                   0,32                            23,00                                  6,70                              0,06                            896,70                             -73,01%                                     0,5                              9,5

        starachowicka                  73                      0,126                             8,96%                                                 5              0,86%                            1 260,20                              28,60%                               6 512 -18,90%                                                      580,45                           63,04%                                      5,42                                     28                   0,19                                    7,20                           0,10                              0,01                            249,30                             -12,31%                                     1,5                              9,0

            suwalska                   53                      0,155                             1,92%                                                 3              0,88%                            1 376,50                                 2,60%                             5 026                        -2,10%                                342,77                           69,03%                                      11,7                                     43                   0,27                            22,70                                  0,00                              0,07                         -1261,30                             330,92%                                      3,0                              8,0

         tarnobrzeska         115                              0,086                         12,75%                                                    8              0,60%                            5 459,40                              15,30%                              23 335                           3,50%                            1 336,44                           78,69%                                      7,94                                     34                   0,23                      181,00                               12,80                                     0,14                         4897,70                               -12,76%                                     4,5                              3,0

          wałbrzyska          141                              0,085                         41,00%                                 14                                0,85% 11 219,80                                                        16,50%                              28 473                        -7,90%                              1 651,52                           67,77%                               10,64                                           27                   0,39                      317,70                               41,30                                     0,19                         5940,70                               -84,44%                                     7,0                              2,0

warmińsko-mazurska                     61                      0,078                         17,31%                                                    8              1,02%                            2 637,80                                 8,00%                             9 799                           9,70%                              782,05                           72,76%                                      5,52                                     21                   0,27                            83,60                                  5,40                              0,11                         2640,60                              -243,27%                                     1,5                              7,5

             average                   90                      0,105                         17,48%                                                    9              1,06%                            4 756,41                              16,57%                              14 894                                                        -                              902      66,2%                                      9,55                                     31                   0,30                      130,05                               14,16                                     0,12                                                       -                                       -           4,2                              5,8


             more than 25% above the average for all zones (with the exceptions described below)
             more than 25% below the average for all zones (with the exceptions described below)
             +/- 25% on the average for all zones (with the exceptions described below)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              Source:
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     Prepared by the authors on the basis of
    *    Increase – positive value (green colour); decrease – negative value (red colour)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            “Report on the Implementation of the Law on
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     Special Economic Zones as of Dec. 31, 2009,”
    ** Area utilised in %: investment higher by over 10% than the average for all zones (green colour); investment lower by over 10% than the average for all zones (red colour)                                                                                                                                                                                                                                                                                                                                                                                                                     Ministry of the Economy, Warsaw, May 2010,
    *** Financial balance – positive value (green colour); negative value (red colour)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               and information from the Ministry’s website.


    66 ::     polish market :: 2/2011
                                                                                            Eastern Partnership



Doing business in Russia.
An overview of trouble zones
Synoradzki, Bentkowska and Partners Law Office and Russia Consulting                       director has a special position and is
                                                                                         the sole executive organ and can decide
Group CIS have held a conference in Warsaw to mark the launch of their                   almost everything and this power can
cooperation. Russia Consulting Group aids business set-up and expansion                  be limited only internally. A general
                                                                                         director has also lots of responsibili-
in Russia, Belarus, Kazakhstan and Ukraine, a group of countries also                    ties, reaching as far as receiving a bill
called the Commonwealth of Independent States – CIS.                                     of penalty in case of mistakes in tax-
                                                                                         ation. Among his duties is also sign-
Sandra Wierzbicka                                                                        ing a lot of documents, which makes
                                                                                         it difficult to keep an overview. A gen-
                                                                                         eral director would also be often asked
Russia offers a lot to investors.           difficult to get VAT reimbursed, as            to personally appear at a tax authori-
It is a huge market, one that is polit-     many tax authorities would reimburse         ty. Therefore a general director has to
ically stable. Private consumption is       VAT only after a company has noted           be carefully chosen, especially so, if
surging, currency reserves are high,        profit. Currency control is obligatory        a company decides to outsource the
it is in a customs union with Belarus       and it requires fi ling the contract be-      position.
and Kazakhstan (but not Ukraine), and       tween the mother company and the                 Human resources recruitment is a
the tax rates are favourable. The prof-     daughter company to the bank. There          very difficult task in general in Rus-
it tax in Russia is 20% (flat rate), VAT     is also “loss commission”, which gen-        sia. An employer has to watch out for
is 18%, social taxes on salaries are 0%     erally is not in line with the law, but      fake CVs and fake diplomas. Russian
for foreigners, only the payroll tax is     may be often pushed by local tax au-         workers are often characterized by
30%. These numbers are respectively         thorities. There are also a lot of misun-    low commitment to a job, short ex-
25%, 20%, 40% and 15-17% in Ukraine         derstandings with Russian account-           perience and not knowing other lan-
and 24%, 20%, 0% and 35% in Belarus.        ants as to turnover (with or without         guages. Good employees are hard to
     However, a businessperson poten-       VAT), salaries (net or gross), deduct-       find and keep, but an additional health
tially interested in investing in Russia    able or not deductable costs. On the         care insurance can do the trick.
has to be aware of certain difficulties.      bright side, Russia and Poland have a            Anyone starting a business in Rus-
Accounting is extremely complex, it         double taxation agreement owing to           sia will also have to make a decision
requires fi ling approximately 15 re-        which dividend, interest and royal-          as to what legal form to take. There is
ports every quarter with the tax au-        ties tax rates are lower (by 5%).            a representative office, a branch and
thorities. There are also certain peculi-       Another issue a foreign busi-            a daughter company. All have their
arities and tax problems when setting       nessperson has to be cautious about          pros and cons. A representative office
up a business. No cost is deductable        are salary negotiations. A future em-        is valid only for marketing activities. A
prior to the official registration date       ployee will typically ask for his or her     branch remains a Polish entity, there-
of the company. In the start-up phase,      salary in the cash-on-hand amount.           fore money and profit transfer is easy
when a business typically has only          The employer has to know that the to-        between the two. However, there are
expenses and no revenues, it may be         tal costs on top of the salary come to       serious disadvantages when it comes
                                            45% of the net amount in Russia, 55%         to dealing with Russian clients and
                                            in Belarus and 68% in Ukraine.               distributors, who have to provide a
                                                A crucial person in Russian busi-        lot of documents to transfer money to
                                            ness in the general director of any          a branch and they usually do not like
                                            company. Russia is characterized by          it. A daughter company is a fully in-
                                            a large power distance. The general          dependent legal entity. Capital infu-
                                                                                         sion and profit repatriation to Poland
                                                                                         are rather difficult as they are sub-
                                                                                         ject to tax and currency control. Yet,
                                                                                         dealing with Russian clients is easy
                                                                                         and obstacle free. Therefore a branch
                                                                                         is better for those who want to run a
                                            On the left, Ulf Schneider, Founder          service company and a daughter com-
                                            and Managing Director of Russia Consulting   pany is for those venturing into trade.
                                            Group CIS                                    Russia is waiting.                      ::

                                                                                                   2/2011 :: polish market ::   67
 Eastern Partnership



Dynamic development
“Polish Market” talks to Jan Mikołuszko,                         numerous, I will name only the two
                                                                 most recent. In the fourth quarter of
President of Unibep S.A.                                         the last year, residents moved into a
                                                                 beautiful building complex in Ursy-
                                                                 nów, in Warsaw (called New Imielin),
                                                                 we also successfully completed the last
                                                                 phase of our own development, the
    “Unibep is one of the most dynamically growing Polish        Santorini estate in Gocławek, also a
    construction firms, working in the residential, commer-       district of Warsaw. We are presently
    cial, general and public procurement construction seg-       engaged in interesting projects such
    ment” – can be read off of your webpage. How can you          as the Podlasie Opera and Philhar-
    prove this opinion to be true?                               monic building in Białystok, a very
Fortunately there is nothing additional that has to be prov-     large sports hall in Częstochowa and
en in this matter. Our growth is shown both by the volume        a hotel/office complex near the Saint
of our sales, profitability as well as the size of the segments   Petersburg airport. Of interest is also
of the construction industry in which we have made con-          the agreement signed last year for the
siderable headway.                                               design and construction of a four-star
    If we only judge growth dynamics according to the last       Victoria hotel in Minsk, the capital of
five years, our sales grew fivefold – we anticipate reaching       Belarus.
PLN 800 million in sales this year. Five years ago we were
strictly in the domestic construction of buildings, today            What are your foreign subsidiaries
we are in five segments. Besides domestic general con-                involved in? What projects are you
struction, these are:                                                proud of the most?
– export construction in Russia and Belarus,                     We have decided to enter difficult and
– road building,                                                 unusual, but also very promising, for-
– residential and commercial development,                        eign markets. In 2004, we began our
– production and export to Norway of manufactured mod-           operations on the Russian market,
    ular homes.                                                  while 2009 marked the beginning of
    All these businesses complement each other and pro-          our fi rst project on the Norwegian
duce a synergy effect.                                            market, connected with the export of
                                                                 our products, we signed a very pres-
    In which segment does the firm generate the highest in-       tigious contract with Belarus last year.    constantly have many requests for
    come?                                                        All these markets received a very good      proposals and we are working on fur-
Our underlying business is domestic construction. We have        rating from international fi nancial         ther customer acquisition. There are
the strongest position in residential construction, where        institutions and Unibep possesses           very few significant Polish fi rms on
we are involved in a full range of orders – from the regu-       unique abilities in development, logis-     the Eastern markets. I believe that this
lar residential construction, to apartment buildings and         tics, legal and tax matters. Th is means    is not a good situation for us who are
fi nishing with single-family homes. At present, however,         that we have a lasting competitive          active there nor for the Polish econ-
around half of our orders are for commercial and cultur-         advantage. An especially important          omy. In the prior political system,
al buildings such as opera houses and concert halls, sports      skill of ours is the effective coopera-      Polish construction had a strong po-
facilities, office blocks and even hospitals. Domestic build-      tion with fi nancial institutions, such      sition in the Soviet Union, including
ing construction allows us to earn about 50% of our income       as the Export Credit Insurance Cor-         the considerable accomplishments of
and is a training ground for our staff.                           poration. We won the Belarus project        fi rms such as Budimex or Energo-
                                                                 owing to an offer which included a fi-        pol. Even today we still hear posi-
    Which projects would you consider to be the most im-         nancing proposal from Bank Gospo-           tive opinions about those builders. It
    portant in each of the segments?                             darstwa Krajowego.                          is not easy to be active on those mar-
I will name only the most interesting projects from the last                                                 kets – what is needed most is an ex-
two years. For example, we recently built a four storey res-        What share of your income is your        cellent team with good knowledge of
idential building out of our modules in Mo I Rana, Norway,          credit activity responsible for? Is it   the Russian language and the ability
placed close to the polar circle. Two years ago, we complet-        easy to operate on the Eastern mar-      to navigate in the administrative and
ed a giant complex in downtown Kaliningrad, Russia, con-            ket? What would you advise those         cultural spheres. I am warning every-
sisting of a shopping centre, an office block and a four-star         wanting to follow in your tracks?        one not to attempt to function on East-
Radisson SAS hotel. Last year in December, we delivered             The Eastern markets should ensure        ern markets at the margin of the law
a recreation water park complex in Suwałki, half a year          around 20% of our income for 2011,          and with questionable local partners
ahead of schedule, and two years ago, our most beautiful         and the start-up Norwegian market           – this is always short-lived and pos-
shopping centre Alfa, constructed in a 19th-century facto-       already around 10%. All these mar-          es tremendous risks for both the fi rm
ry building in Białystok. Our residential projects are very      kets have development potential, we         and the personnel.                    ::

68 ::   polish market :: 2/2011
 Eastern Partnership

                                                                                                             on long-term insurance, but the pre-

Known among exporters                                                                                        mium is only charged once, while the
                                                                                                             risk is assumed for 5, or even 12 years.
                                                                                                             In a word, we work for the insurance
                                                                                                             paid for in the 20th century and KUKE
“In 20 years we have managed to create from scratch a viable operating                                       supervises the credit for its ‘lifetime’.
                                                                                                             In 2010 KUKE achieved the top fi nan-
system of export insurance and an institution which is stable, safe and                                      cial results in its 20-year history.
economically healthy in its commercial division,” says Zygmunt Kostkiewicz,
                                                                                                                 What countries are classified as
president of the Management Board of Export Credit Insurance Corporation                                         non-commercial?
Joint Stock Company (KUKE SA), in an interview with Jerzy Bojanowicz.                                        According to the OECD these are
                                                                                                             countries for which no market rein-
                                                                                                             surance protection for balances due
                                                                                                             can be obtained. There are 58 such
                                                                     What is your most popular prod-         countries on our list. These are coun-
                                                                     uct?                                    tries which have been excluded from
                                                                 Domestic receivables insurance, which       commercial insurance protection due
                                                                 amounts to 99% of commercial pre-           to their unstable economic or polit-
                                                                 miums. Many entrepreneurs prefer to         ical situation, Polish foreign policy
                                                                 have one policy, as then it is not impor-   (though I know of no such case) or
                                                                 tant whether they sell goods or serv-       the policy of international organi-
                                                                 ices to a contracting party within the      sations Poland is a member of (such
                                                                 same country, or to an EU member            as the OECD) – currently there is,
                                                                 country or a non-EU member coun-            for example, a ban on giving long-
                                                                 try. The most important thing for the       term credit to Iran. Insurance rates
                                                                 Polish entrepreneur is to secure pay-       for those markets are on average 1.5
                                                                 ment of the invoice. Other revenues of      to 2 times higher than the rates of-
                                                                 the company come from support by the        fered on commercial markets. How-
                                                                 State, which we would like to develop       ever, if the enterpreneur negotiates a
                                                                 and promote among entrepreneurs. As         rate with KUKE, it is binding for the
                                                                 far as state-backed insurance is con-       whole delivery (export/sale) of goods
                                                                 cerned, i.e. so-called non-commercial       or services by this entrepreneur. Then
                                                                 risk, we insure payments of invoices        the rate is the same for sales to domes-
                                                                 when selling to economically or polit-      tic, German or New Zealand contract-
                                                                 ically unstable markets. Around 1,000       ing parties.
                                                                 Polish companies are covered by such
                                                                 insurance. However, long-term con-               What is there to wish for the next
                                                                 tracts dominate among the premiums               20 years?
                                                                 obtained. These are, among others,          First of all, for Polish exports to de-
                                                                 “bank-to-bank” credits for the pur-         velop well, for Polish exporters to ap-
                           What numbers best characterise 20     chaser, which we have mainly devel-         preciate the significance of minimis-
                           years of KUKE activity?               oped with Bank Gospodarstwa Kra-            ing the risks in their operations and
                       21,390 applications examined, 11.2        jowego, or “project fi nance,” when a        for them to learn to utilise all the in-
                       thousand insurances granted and guar-     Polish bank fi nances the purchaser          struments at their disposal, espe-
                       antees of USD 40.15 billion, including    of Polish investment goods without          cially long-term export fi nancing,
                       USD 26.29 billion of export insurance.    the participation of a local bank. We       as goods are nowadays sold together
                       We made USD 900.4 million in premi-       manage to gather 85% of the premi-          with fi nancing. Th is is just as impor-
                       ums. KUKE plays the role of an Export     um from export credit insurance, with       tant as the price and quality of goods
                       Credit Agency at rates normal for the     the support of the state, in the long-      or services sold. Exporters who can
                       region, i.e. covering a similar amount    term and about 15% from non-com-            utilise all the instruments available
                       of Polish exports with insurance as the   mercial risk. Th is implies that export     have been very successful recently.
                       Slovakian or Hungarian agencies in        insurance with state support realised       UNIBEP, building hotels at Pulkovo
                       their respective countries. The share     on credits for two years or more is the     Airport in Saint Petersburg and in
                       of credit insurance granted with the      most popular.                               Minsk in Belarus is such an example.
                       support of the State is also comparable                                               It is also setting up 2-3 similar enter-
                       to those of large agencies in the West.       And in terms of revenue?                prises on the Russian market, which
                       We have achieved good standards in        The commission charged is identical         may be fi nalised this year. UNIBEP has
                       terms of the coverage and support of      for all types of state-supported insur-     succeeded in communicating with us
                       Polish exports, as well as efficiency in    ance, while the cost of commercial in-      and the banks in terms of fi nancing
                       our actions and product range. We of-     surance is higher than the premiums.        big construction contracts, worth over
                       fer everything foreign companies do.      During a good year we earn really well      EUR 40 million.                        ::

70 ::   polish market :: 2/2011
                                                                                                                                    Eastern Partnership


The economic crisis is a serious
danger to Polish exports
                                                                                    aforementioned markets, due to the           making financing available for markets
Jerzy Kurella                                                                       fi nancing offer being “included.”             of increased risk. Additionally, BGK fi-
                                                                                        In response to the threat to exports     nancing costs are established on an at-
                              The present financial crisis has                      arising out of the situation created by      tractive, minimal level, allowed under
                              caused an increased aversion to risk                  the world crisis, the Export Support         international agreements.
                              for fi nancial institutions. Spectacu-                 Government Programme was creat-                   In terms of long-term fi nancing
                              lar cases of insolvency have persuad-                 ed. The programme’s main goals are           (repayment period above 2 years), the
                              ed banks to stop financing transactions                the following:                               programme does not place any limi-
                              that generate an increased, or hard to                :: enabling the fi nancing of purchas-        tation as to the destination of the ex-
                              assess, repayment risk. As the fi rst                      ers of Polish products and servic-       ports being supported. In terms of
                              step, banks have limited the fi nanc-                      es, including higher-risk countries      short-term fi nancing (repayment pe-
                              ing of export transactions, especially                    essential to Polish exports, i.e. Be-    riod up to 2 years), only those export
                              to markets of increased risk. As a con-                   larus and Russia,                        transactions can be financed where the
The autor is Vice-
president of the              sequence, Polish exporters lost the ca-               :: attractive financing terms, at a level     intermediary bank (importer’s bank)
management Board              pability of offering their customers the                   comparable to those offered by ex-        is located in a country with non-mar-
of BGK                        option of financing the exported goods                     porters from other European Un-          ket risk, i.e. a country outside the Eu-
                              and services which they purchased. In                     ion countries and OECD countries.        ropean Union and OECD.
                              conjunction with the recession in those                   The administration of export loans            In practice, the greatest interest
                              markets and the limited capabilities of               on the basis on the government pro-          in the fi nancing made available un-
                              fi nancing export transactions by local                gramme has been entrusted to the             der the programme is shown by ex-
                              banks (the importers’ banks), this sit-               Bank Gospodarstwa Krajowego (BGK)            porters and their partners to countries
                              uation became the greatest danger to                  – the only government-owned bank             such as: Belarus, Russia, Kazakhstan,
                              Polish exports, especially to countries               that is suited for this type of under-       Ukraine, Georgia and the Middle East.
                              such as Russia, Belarus, Ukraine and                  taking. The credit risk is secured by the         The programme is realised by BGK
                              the remaining CIS countries.                          Export Credit Insurance Corporation,         in a “non-profit” manner. Th is means
                                  The competitive position of Polish                guaranteed by the National Treasury.         that BGK does not profit from the pro-
                              enterprises on Eastern markets has                    According to expectations, by the end        gramme – the margin only compen-
                              also been endangered. Exporters from                  of 2015 BGK will have issued export          sates the bank for administrative costs.
                              the majority of other European Un-                    loans under the programme worth              The government accepted the possi-
                              ion countries, thanks to the support                  PLN 5.7 billion.                             bility that the bank may incur a loss
                              of government fi nancial institutions                      Implementing the government pro-         on the low-interest export loans. In
                              (for example, the German KfW, Czech                   gramme, BGK issues loans to foreign          these cases, the loss will be refunded
                              CEB), continued to offer their foreign                 customers for the purchase of Polish         to the bank by the National Treasury.
                              customers purchase on credit. A risk                  goods and services. The financing is ac-           Exporters interested in the possi-
                              was created that competitors from                     complished with the intermediation of        bility of competitive financing for their
                              other countries will fi ll the space left              a local bank (the importer’s bank). The      customers, especially from countries
                              behind by Polish companies on the                     programme’s uniqueness is based on           of increased risk, should contact the
                                                                                                                                 BGK, through the BGK Department
                                                                                                                     The Czech   of Foreign Trade Support or through
                                        Russia          Belarus       Kazakhstan        Azerbaijan       Georgia
                                                                                                                     Republic*   the chain of branch locations across
Short-term financing: credit cost     Repayment period: up to 2 years (export of any goods or services)                           the country.
components                           Example: loan with a one year repayment period, issued in EUR
                                                                                                                                      BGK will verify every transaction
EURIBOR12 M                              1.50%             1.50%           1.50%            1.50%          1.50%       1.50%
                                                                                                                                 submitted in terms of the possibility
Margin (includes KUKE insurance)         1.75%             2.50%           2.00%            2.00%          2.20%       2.00%
                                                                                                                                 of being included in the government
No additional fees                            –                 –               –                –              –          –
                                                                                                                                 programme, will help with the selec-
Total annual cost of credit              3.25%            4.00%            3.50%            3.50%          3.70%       3.50%     tion of an appropriate financial instru-
Long-term financing: credit cost      Repayment period: from 2 to 5 years (export of investment goods and services)               ment and will provide information re-
components                           Example: loan with a fi ve year repayment period, issued in EUR
                                                                                                                                 garding fi nancing costs. In case there
Constant CIRR rate                       2.32%             2.32%           2.32%            2.32%          2.32%       2.32%
                                                                                                                                 is a need to authenticate BGK’s offer,
Margin (includes KUKE insurance)         0.50%             0.50%           0.50%            0.50%          0.50%       0.50%
                                                                                                                                 e.g. needed by the exporter for a ten-
KUKE insurance                           1.72%             3.74%           2.27%            2.27%          2.92%       0.60%
                                                                                                                                 der process, the bank will issue in-
if one-time payment                      3.96%             8.70%           5.29%            5.29%          6.82%       1.16%     formation concerning the fi nancing
Total annual cost of credit              4.54%             6.56%           5.09%            5.09%          5.74%       3.42%     terms in writing, in one of three lan-
* financing off er with up to a 2 year repayment period – outside of the Government Programme                                      guages: Polish, Russian or English. ::

                                                                                                                                           2/2011 :: polish market ::   71
 Infrastructure



Structural investment
to impel construction in Poland
Poland is gaining awareness of how to leverage the possibilities offered by               roads and motorways. The entire in-
                                                                                         vestment value will total over EUR
EU membership. Every year, the number of executed projects, co-financed                   14 billion. More than 1,700 kilome-
by the EU, is rising. Now the time has come to boost investment in road,                 tres of motorways and 1,200 kilome-
                                                                                         tres of express roads are to be built in
energy and railway infrastructure. These sectors should lead the way in                  Central Europe by 2013.
the Polish construction industry and become its driving force.                               The EU subsidies keep being the
                                                                                         chief driving force for the construc-
Magdalena Szwed                                                                          tion industry. Th anks to the Oper-
                                                                                         ational Programme “Infrastructure
                                                                                         and Environment,” the General Di-
                                              Between the year of accession              rectorate for National Roads and Mo-
                                              to the EU and 2008, the econom-            torways (GDDKiA) concluded 24 fi-
                                              ic growth in Poland averaged 5.4%.         nancing agreements (until 2010). The
                                              In spite of trouble in the fi nancial       total value of these projects amounted
                                              markets, 2009 saw the Polish GDP           to PLN 40 billion out of which the sum
                                              growth reach 1.8%, i.e. more than in,      of PLN 32 billion was paid by the EU.
                                              say, Austria or Sweden. According to           The power construction sector, in
                                              the current forecasts of the Minis-        which we are quite backward as com-
                                              try of Finance, GDP should raise by        pared to other European states, needs
                                              3.5% in 2011.                              to be modernized as well. Before 2006,
                                                  Th is year seems favourable for the    the National Development Plan con-
                                              development of the infrastructural         tributed to the execution of approx.
                                              construction segment. Such invest-         1,200 projects which were paid for,
                                              ments are likely to dominate the mar-      in 65%, by the EU. In 2009, most re-
                                              ket both in Poland and other Europe-       newable energy (42%) was generated
                                              an countries. Poland will be handling      in the Warmińsko-Mazurskie prov-
                                              a large portion of road investments,       ince, while 37% came from the Ku-
                                              mainly in relation to the organiza-        jawsko-Pomorskie province – as re-
                                              tion of the Euro 2012 football cham-       vealed by the Ministry of Regional
                                              pionships. Some of the ventures are        Development.
                                              being carried out, others will be-
                                              gin in 2011. According to PMR ana-         We are decisively not a lead-
                                              lysts, contracts have been signed for      er with regard to the increment of
                                              building 1,300 kilometres of express       the water supply network, the to-
                                                                                         tal length of which totalled 267,300
                                                                                         kilometres two years ago. The largest
                                               Road investments between 2000 and 2010
                                                                                         increase was noted in the Mazowiec-
                                                      Year             Expenditure
                                                                                         kie province – about 30% in compar-
                                                     2000                 2.95
                                                                                         ison with 2003.
                                                     2001                 2.98               As for the construction sector, the
                                                     2002                   3.2          road building will obviously domi-
                                                     2003                 4.00           nate. Many construction companies
                                                     2004                 5.52           which have not dealt with this type
                                                     2005                 6.62           of building so far will be inclined to
                                                     2006                  7.79          adapt themselves to the new reali-
                                                                                         ty. Such an attitude will be shored
                                                     2007                10.06
                                                                                         up by the increasing EU subsidies
                                                     2008                13.61
                                                                                         combined with a growing number
                                                     2009                18.37
                                                                                         of projects for which tenders are an-
                                                     2010                20.00           nounced. According to data published
                                                                        Source: GDDKiA   by GGDKiA, more than 150 kilometres

72 ::   polish market :: 2/2011
                                                                                                                        Infrastructure




Transsystem
from one thousand dollars to one thousand employees
                                                                                                   undertaking was qualified for the fi nal of the
                                                                                                   competition of International Project Manage-
                                                                                                   ment Award among the best projects in Eu-
                                                                                                   rope and became the Prize Winner.
                                                                                                       The years 2003–2006 again watched a
                                                                                                   fast development of the company. Transsys-
                                                                                                   tem performed contracts for the factories of
                                                                                                   Volkswagen, Audi, Porsche, Mercedes, Jag-
                                                                                                   uar and BMW, among others. It also manu-
                                                                                                   factured process lines for all factories of Gen-
                                                                                                   eral Motors in the world.
                                                                                                       The fi rst symptoms of crisis appearing at
                                                                                                   the end of 2006 forced the Management Board
                                                                                                   of the company to extend the portfolio of the
                                                                                                   offered products. Transsystem proposed its
                                                                                                   services to such industries as power engi-
                                                                                                   neering, mining or tourism. The offered so-
                                                                                                   lutions covered the manufacturing of state-
                                                                                                   of-the-art steel structures, public transport
                                                                                                   systems or bulk transport systems for materi-
                                                                                                   als such as coal, gypsum or biomass. The deci-
                                                                                                   sion proved to be a very good move. Currently
                                                                                                   as much as 50% of the revenues of the com-
                                                                                                   pany are generated on contracts performed
                                                                                                   for power engineering and mining industries.
Transsystem SA, the largest Polish company specialising in process                                     The Management Board puts emphasis
                                                                                                   on modern proprietary engineering solu-
transport systems, celebrates its 20th anniversary. The interesting                                tions. The Research and Development Cen-
history of this rapidly developing company is the best example that                                tre of the company develops technologies in-
                                                                                                   tended mainly for the automotive and power
thanks to one’s entrepreneurship skills a progress from one thousand                               engineering sectors. As an effect of work of
dollars to one thousand employees is possible.                                                     our engineers an innovative belt conveyor
                                                                                                   for transporting aggregate, loose materials
                                                                                                   or biomass has been developed. In the con-
                                                                                                   veyor a system enabling constant monitor-
The beginnings of the company date back           systems, mainly for automotive industry. The     ing of the condition of the material transport-
to 1991. At that time the existing President of   company has been quickly entering the most       ing belt has been applied. The system reports
the Management Board and Managing Direc-          requiring markets and has become partner         belt damage long before it would have actual-
tor of Transsystem, Stanisław Sroka, togeth-      for the largest world’s companies. A spec-       ly occurred. Therefore, repairs may be fore-
er with three of his friends opened a compa-      tacular success was, among others, the en-       seen and planned in much advance, avoid-
ny offering the manufacturing of simple steel      trance to the Chinese market, when the com-      ing costly emergency downtimes or more
structures. Within only 10 years of its exist-    plete process transport system was supplied      general damage.
ence the small company employing 14 people        to the Volkswagen factory in Changchun.              The company has its headquarters in Wola
transformed into an enterprise managed to             In order to support the pace of growth,      Dalsza, in the south-east of Poland, the Pod-
the modern standards, capable of performing       in January 2001 the Management Board of          karpackie Province. Branch offices are locat-
comprehensive manufacturing and assem-            Transsystem decided to transform the com-        ed in Germany, Russia, Czech Republic and
bly projects of automated process transport       pany into a project-oriented organisation. The   Ukraine.                                       ::




                                                                                                                    2/2011 :: polish market ::   73
 Infrastructure


of new roads were completed in 2010,
                                                                    Outlays for road and railway infrastructure between 2005 and 2009
and PLN 1.4 billion was spent on re-
                                                                                                                          Years
pairing 767 kilometres of roads. In
                                                                                              2005          2006          2007          2008      2009
the same year, GDDKiA signed con-
tracts for building 544 kilometres of      GDDKiA       road length (km)                      18287        18439         18439          18500    18579
express roads and motorways. 1,403                      investment (PLN million)               7021          9244        11865          13618    18370
kilometres of roads were being con-        PKP PLK SA rail tracks length (km)                 19042        18964         18993          19201     19201
structed at the end of the year.
                                                        investment (PLN million)                945          1376          2446          3175      2756
    In 2000, the value of road invest-
ments in Poland amounted to PLN 2.9                                                                                                             Source: GUS
billion, i.e. as much as the state budg-
et spent on the roads in 2010. The road        The Ministry of Infrastructure pre-
construction expenditure has been          dicts that between 2010 and 2013 in-
rising constantly since 2004. 2008         vestment in railways will amount to
saw the biggest expense growth, as         PLN 26 million out of which PLN 17.7
the investment outlays totalled PLN        billion will come from the Operational
13.6 billion. One year later, the value    Programme “Infrastructure and En-
grew by PLN 4.7 million.                   vironment” and PLN 1.7 million from
    Notwithstanding the weath-             the Regional Operational Programme.
er conditions, GDDKiA managed to               For now, PKP SA (Polish Railways)
fi nish the year with a record result in    has been making some serious re-
regard to the road venture expendi-        pairs. The whole plan stipulates the
ture. The expenses came to the level       refurbishment and modernization of
of PLN 20 billion at the end of 2010,      over 70 railway stations. Overhaul-
out of which PLN 16.9 billion was paid     ing works are being carried out in 41
by the National Road Fund.                 facilities. 25 of them are to be com-
                                           pleted in 2011. Some railway stations
                                           have already been modernized, for
Road projects in 2011
                                           instance: Łódź, Gorzów Wielkopol-
                         projects to be
                        completed (km)     ski, Kołobrzeg, Tarnów. In 2012, the
motorways                     230
                                           repairs should be fi nished in Gdynia,
                                           Warszawa Wschodnia, and Warszawa
express roads                70.6
                                           Centralna.                                     Poland, the length of its water supply system at the end of
beltways                     79.8              PLN 1 billion will be spent on over-       2009 was 270,000 kilometres. The most serious extension
                          Source: GDDKiA   hauling Polish railway stations until          works were carried out in the following provinces: Pod-
                                           the end of 2012. A part of this amount         karpackie, Małopolskie, Śląskie.
So what is the outlook for the             – PLN 200 million – will be covered by
road construction industry in              the state budget, while half as much           The Polish energy infrastructure, suffering main-
2011?                                      will be paid by PKP SA. By the end             ly from the shortage of specialist and modern machinery,
GDDKiA is planning on starting the         of 2013, the EU will have spent PLN            should also be fi nancially supported. About one fourth of
construction works on 40 kilometres        500 million on railway station repair          our energy producing devices do not meet the requirements.
of motorways, 159 kilometres of ex-        works.                                         We are not doing too well when it comes to producing re-
press roads, and 66 kilometres of belt-        The EU funds have made it possi-           newable energy. Th is type of energy makes up only about
ways. The completed sections should        ble to make some serious investments           3% of the total energy output. As for the renewable ener-
include: 230 kilometres of motorways,      in environment protection infrastruc-          gy ventures, Poland executed 6 projects whose value ex-
70 kilometres of express roads, and 79     ture. Adapting our environment pro-            ceeded PLN 20 million.
kilometres of bypasses.                    tection infrastructure to EU standards             Four years into the EU membership, our economy con-
    Will the investments carried out       is crucial and unavoidable. Having uti-        sumed 17% less energy than before accession. We are still
in 2011 revive the railway construc-       lized EU funds, Poland – before the end        not in the lead, but we remain ahead of: Hungary, Lithua-
tion market?                               of 2009 – modernized and upgraded              nia, the Czech Republic and Slovakia.                   ::
    In Poland, there are over 2,000        approximately 250 sewage treatment
railway stations, half of which are not    plants. It took 5 years for the number
utilized. Measures known and de-           of sewage treatment plants to rise from
ployed in other European countries         4,100 to 4,300 in 2009. Around 200 in-
could reinforce railway investments.       dustrial sewage facilities were liqui-
For example, the UK and Belgium            dated, while the number of the pub-            PLN 1 billion will be spent on overhauling Polish train
have implemented plans of coopera-         lic ones rose by 400. All in all, more         stations until the end of 2012. A part of this amount –
tion based on the public-private part-     than 14,000 kilometres of the sewerage         PLN 200 million – will be covered by the state budget,
nership. Poland does not seem ready,       system (and 6,000 kilometres of wa-            while half as much will be paid by PKP SA. By the end
though, to introduce that idea in its      ter supply pipes) were modernized or           of 2013, the EU will have spent PLN 500 million on train
railway sector.                            extended. As for the entire territory of       station repair works.

74 ::   polish market :: 2/2011
 Infrastructure




                                                                                                       strategic aim was to raise the stand-
                                                                                                       ards of road bridges in Central Europe
                                                                                                       (durability assessment, raising bear-
                                                                                                       ing capacities, etc.). Th is was the fi rst
                                                                                                       time that our Institute coordinated
                                                                                                       this project and its ten-odd partici-
                                                                                                       pants. The results achieved in this un-
                                                                                                       dertaking have already been applied
                                                                                                       in several countries.

                                                                                                           Gentlemen don’t discuss money,
                                                                                                           but when we think about the EU we
Heavy Weight                                                                                               also think about the Cohesion Fund
Deflectometer HWD                                                                                           and financing for various projects…
                                                                                                       In 2005 we received 75% of the fund-
                                                                                                       ing for upgrades on our Communica-
“In December we will complete a 1,600 m2, modern-equipped Pavement                                     tion Technology Lab from the Secto-
                                                                                                       ral Operational Programme Transport.
Analysis Lab to which we will move our Pavement Technology Division. This                              Th is entailed the modernization of the
modern laboratory will carry out research on asphalt, other cement types                               building, equipping it with IT systems
                                                                                                       and multimedia and the purchase of
and mineral-asphalt composites,” professor Leszek Rafalski, head of the                                mobile labs. Th is in turn enabled us
Road and Bridge Research Institute, tells “Polish Market’s” Jerzy Bojanowicz.                          to expand our Transport and Trans-
                                                                                                       port Safety Central Database. Under
                                                                                                       the Operational Programme Inno-
                                                                                                       vative Economy we received funds
                                                                                                       to buy very expensive equipment for
    Professor, lately investors have                           bridges have been damaged or have       testing certain features of road and
    raised objections as to the quality                        corroded.                               bridge pavements. These systems will
    of newly-built roads. What is the                                                                  also considerably raise our research
    right asphalt content in asphalt?                             Your Institute takes part in EU-     potential.
In Poland, that what we common-                                   -sponsored research projects.
ly call “asphalt” isn’t really asphalt,                           Which are you most proud of?            The General Directorate for Nation-
but a asphalt mixture with a 6–7%                              The ARCHES project (Assessment and         al Roads and Motorways (GDDKiA)
of asphalt binder content, although                            Rehabilitation of Central European         boasts a research lab. Does this
mastic asphalt has more and asphalt                            Highway Structures) carried out under      mean less work for your Pavement
concrete less. The right asphalt bind-                         the EC’s 6th Framework Programme,          Diagnostics and Pavement Tech-
er content is established by lab tests.                        which we coordinated. The project’s        nology Divisions?
The asphalt binder content in a asphalt
mixture is realise by extraction which
leads to separations of: aggregate, fi ll-
er and asphalt binder. Ever since the
use of polymer binders, which behav-
iour depends on temperature, the ex-
traction process must be very precise.
Quite often such tests influence the
contract payment.

    Your Institute deals with roads and
    bridges. Which to you have to do
    with more often?
We do more research on roads (bear-
ing capacity, roughness, evenness),
                                                                                                                                                    Photo by E. Kaniuk




because we are obliged to control
them regularly. Bridges, on the oth-
er hand, are often controlled by their      Heavy Weight
administrators. We come in where            Deflectometer HWD


76 ::   polish market :: 2/2011
                                                                                                                                                            Infrastructure
Photo by E. Kaniuk




                     Tyre – pavement         The GDDKiA labs will be mainly used            pavement parameters quantification                 to the type of vehicle involved. We are
                     noise measurement       by national road administrators. We            based on non-destructive testing re-              also tendering for several other re-
                     system CPX              will rather focus on local government          search. Under construction is a Cent-             search projects. We also want the Na-
                                             bodies and enterprisers, which is a            er of Scientific Development For Non-              tional Centre for Research and Devel-
                                             pretty big market in itself. We will           Destructive Testing Research which                opment to fi nance a strategic project
                                             continue to work with GDDKiA, be-              will train research staff from various             involving the reinforcement of ex-
                                             cause their labs are not accredited,           institutions in advanced non-invasive             ploited bridges and road pavements.
                                             which is important in confl icts be-            measuring techniques. There we will               We are also planning to conduct re-
                                             tween project executors and inves-             use advanced pavement condition-                  search on the properties of road mate-
                                             tors. Our Institute has 12 accredit-           evaluating equipment, including a la-             rials under repetitive loadings, which
                                             ed labs using more than 400 research           ser deflectometer TSD able to collect              has never yet been done in Poland. We
                                             procedures.                                    data at speed up to 80 km/h. Under-               are well equipped for such research,
                                                                                            way are several interesting projects,             the results will help design highly-
                                                Your plans?                                 including tests on so-called active and           durable road pavements.
                                             On March 31 we will complete the               intelligent road barriers which will
                                             SPID project involving a mobile lab for        react to being crashed into according                  Thank you.                          ::




                     TESTING EUROPEAN PAVEMENTS
                     The Road and Bridge Research             This bears particular importance in          measuring the degree of noise pro-         includes: Profilograf and- Line Scan
                     Institute leads the way in               countries featuring dense traffic and        duced by rolling wheels of a vehicle,      systems.
                     modern road infrastructure               road networks.                           •   CORE DRILLING MACHINE – an ap-
                     research.                                                                             pliance which collects samples for          Project leader:
                                                              Research is conducted by means of            research and identification of sur-          M.Sc.Eng. Jacek Sudyka
                     Our brand new “SPID – System for         the following devices:                       face layers,                                mob. +48 604 560 464
                     Pavement Infrastructure Diagnos-         • TRAFFIC SPEED DEFLECTOMETER            •   RADAR SYSEM FOR BRIDGE MEAS-                e-mail: jsudyka@ibdim.edu.pl
                     tic Testing” is a mobile laboratory         – equipment dedicated for pavement        UREMENTS – a device for detailed            www.spid.edu.pl
                     equipped with state-of-the-art devic-       deflection measurements,                   subsurface examination of bridges,
                     es allowing us to use non-destruct-      • HEAVY WEIGHT DEFLECTOMETER             •   RESEARCH AND ANALYSE SYS-                Donation for innovation
                     ible methods to examine roads and           – examines air-field surfaces, simu-       TEM FOR LOADED BRIDGE’S CON-             All the appliances have been pur-
                     bridges all over Europe. Causing no         lating loads comparable to those of       STRUCTION EVALUATION – using             chased under the project “SPID – The
                     traffic interruptions, the research         a single Boeing 747 wheel,                micro-waves, it allow to perform         mobile laboratory for the non-de-
                     equipment is capable of evaluating       • STEP-FREQUENCY RADAR SYS-                  remote measurements of translo-          structive pavement characteristics
                     the condition of bridges and roads,         TEM – identifies structure of pave-        cations caused by dynamic loads,         quantification” is financed by The Eu-
                     and controlling the quality of tech-        ment construction,                    •   PAVEMENT DISTRESS EVALUA-                ropean Regional Development Fund
                     nologies and materials deployed for      • TYRE – PAVEMENT NOISE MEAS-                TION SYSTEM – automatically regis-       under the Operational Programme In-
                     the building of transportation routes.      UREMENT SYSTEM CPX – a device             ters surface conditions. The system      novative Economy.                  ::




                                                                                                                                                        2/2011 :: polish market ::    77
 Law & Taxes



“Foreign-currency” hunting
Maja Sujkowska                                                                                                on the basis of a permission does not
                                                                                                              release the foreigner from the obli-
                                                                                                              gation to be accompanied by an au-
Poland is divided into over 5000                                   by a foreigner following the examina-      thorised representative of the hunt-
hunting grounds, one-third of which                                tion in Polish expires 5 years from the    ing ground, who, besides picking the
are forest grounds, and the rest are                               date of the examination.                   animals for shooting off, will record
field grounds. Hunting is an all-year-                                  Foreigners who are not citizens of     the data on the times the individu-
round pursuit, with closed seasons for                             an EU member state, or those who, al-      al hunt started and ended, and the
particular animal species observed.                                though possessing the citizenship of       number and species of the animals
With a little luck, hunters in Poland                              an EU member state, have not taken         hunted down.
may add to their collection such formi-                            or passed the supplemental exam in
dable trophies as deer, fallow deer, roe                           Polish can practice hunting only in        The game hunted down in the hunt-
deer, wild boars, mouflons, badgers,                                the presence of a representative of the    ing ground remains the property of
                                             Chairperson General
polecats, martens, foxes, raccoon dogs,                            leaseholder or manager of the hunting      the leaseholder or hunting ground
                                             Partner’s Board at
muskrats, common hares, pheasants,           European Center for   ground who is a member of the Polish       manager, while in areas not covered
partridges, geese, woodcocks, and ha-        Legal Consultations   Hunting Association. The said repre-       by hunting grounds – the property of
zel grouse.                                                        sentative of the hunting ground indi-      the Treasury. Unlawfully hunted down
    The basis for hunting in the Repub-                            cates the game to be shot off and is re-    game is also the property of the Treas-
lic of Poland is provided by the Hunt-                             sponsible for attending to formalities     ury. Hunters may, at their discretion,
ing Act of 13 October 1995 (Journal of                             related to hunt recording.                 put the game given up to them to any
Laws No. 147, item 713). The Act spec-                                 Such “accompanied” hunts with a        use, excluding resale.
ifies the rules and regulations for the                             person who watches over the proper,            Hunting without a relevant license,
admissibility of hunting and the qual-                             safe, and legal shooting off of game by     obtaining game with the use of arms
ifications required to practice it. Pur-                            the hunter can be done in two ways.        and ammunition not allowed for hunt-
suant to this Act, foreigners are also                                 Usually foreigners take advantage      ing, explosives, poison, food with in-
allowed to hunt in Poland.                                         of hunting trips organised by compa-       toxicants, artificial light, bait, snare,
                                                                   nies – organisers of hunting tourism –     digging up dens or using other for-
Hunting may be practiced by foreigners who:                        that are entered in the province hunt-     bidden means is punished with up to
1. are citizens of EU member states who possess a license to       ing register. Although these trips are     5 years’ imprisonment.
   practice hunting in their countries and who have passed         generally the more expensive of the two        The correct carrying out of the pro-
   the supplemental examination in Polish,                         ways available to foreigners who would     visions of the Act is overseen by rang-
2. have purchased a hunting package from a company en-             like to hunt in Poland, they have sub-     ers from the National Hunting Guard.
   tered into the hunting register and providing tourist           stantial benefits which include passing         Pursuant to the Act on Arms and
   services in this respect,                                       over the requirement of obtaining an       Ammunition of 21 May 1999 (Journal
3. have been granted individual permission from the rel-           individual administrative permission       of Laws of 2004, No. 52, item 525) for-
   evant Minister of the Environment.                              to hunt and the safety arising from the    eigners staying in the Republic of Po-
                                                                   requirement on the organiser’s part to     land are allowed to bring in and take
In the case described in point 1, foreigners who are               provide a relevant security (i.e. insur-   out hunting arms and ammunition in
citizens of EU member states can practice hunting under            ance) against the claims of third par-     the amount not exceeding 100 piec-
the same rules and regulations as Polish hunters only af-          ties for the failure to perform or inad-   es total, provided that the arms and
ter they pass supplemental examination in Polish. The ex-          equate performance of an obligation.       ammunition are to be used to practice
amination covers the current Polish regulations providing          Besides these benefits, the organiser       hunting in accordance with the law.
for the rules of hunting, the list of game species and hunt-       will also be helpful in fi nding a good     The bringing in and taking out of arms
ing periods for these animals, and, in case of an animal           hunting ground, provide formal assist-     and ammunition by foreign hunters is
population selection license, also the rules for the popula-       ance from its representative, organise     regulated on the basis of a certificate
tion and ontogenetic selection of deer. Hunters who com-           board and lodging, and provide trans-      issued by the relevant Consul of the
ply with the abovementioned criteria are allowed to prac-          port services.                             Republic of Poland, which can be used
tice both group hunts and individual hunts, during which               The other method to practice           instead of a fi rearm permit for up to 30
they have to fulfi l a set of formal obligations related to hunt    hunting in Poland is to obtain an          days. In case of foreigners who are EU
recording. What is more, individual hunting requires the           individual foreigner’s hunting per-        citizens the bringing in and taking out
foreigner to have on him or her the documents certifying           mission issued by the relevant Min-        of arms and ammunition can also be
the hunting license, the license to own hunting rifles, the         ister of the Environment. The Polish       performed on the basis of a European
permission of the relevant Minister of the Environment to          Hunting Association, or, in the case       Firearms Pass issued by an EU mem-
hunt game using hunting birds (if the latter are involved),        of hunting in managed grounds, their       ber state. Th is certificate gives foreign-
and a written authorisation issued by the leaseholder or           manager may apply for permission           ers the right to purchase ammunition
the manager of the hunting ground. The license acquired            on behalf of the foreigner. Hunting        for the fi rearms it specifies.            ::

78 ::   polish market :: 2/2011
                                                                                                                                  Law & Taxes



Polish public procurement market
– a tidbit or a bureaucratic trap?
More and more tenders submitted in the Polish public procurement come                                            for a certification, claiming that eve-
                                                                                                                 ry insured entity has an unique cus-
from foreign entrepreneurs. Until recently, the subject of their interest                                        tomer number and any time can log
were the construction works, especially multimillion dollar contracts to                                         into the system and get an informa-
                                                                                                                 tion on the amount of the insurance
build the motorways, while now, it also includes e.g. the teleinformatic                                         premiums, the dates of their payment
services or supplies of an advanced medical equipment.                                                           etc. However, such a printout from the
                                                                                                                 system does not fulfil the requirements
                                                                                                                 of certification and cannot be submit-
                                                                                                                 ted as the document confi rming not
                      The Polish procurement market                 increases the cost of its preparation.       being behind with paying the insur-
                      is very attractive for the international      Often in the specification of essential       ance premiums. Many entrepreneurs
                      concerns planning to acquire new areas        terms of contract, especially in the case    who have disaccustomed from such far
                      of their activity. In order to achieve this   of the construction works, the offeror        reaching formalism and bureaucracy
                      goal, they set up in Poland new com-          imposes on the contractor the obliga-        are perplexed by the fact they are be-
                      panies or open new branches. Submit-          tion of the inspection of the scene of the   ing called to fi ll the documents con-
                      ting offers, the international concerns        future construction. Although such in-       fi rming the fulfi lment of this condi-
                      are present in the consortium togeth-         spection increases the cost of preparing     tion – in their belief they have already
                      er with their Polish companies or take        the offer, resigning from conducting it       supplied those documents and so they
                      their own struggles with pervasive bu-        increases the risk of performing works       often ignore the reminder to do it.
Anna Piecuch,
                      reaucracy, foreign and incomprehen-           not covered in the documents submit-             The formalism connected with the
attorney at law,
Head of the           sible practice of clerical, and above all     ted by the awarding entity, that can be      awarding of the public contracts con-
Department of the     legal regulations. The lack of ability to     found during the inspection. Also in-        cerns also the matter of the experience
Public Procurement,   correctly interpretation of the rules is      creases the risk of a refusal by the of-     of the contractor as well as the refer-
Chałas & Partners     – apart from the ignorance of the local       feror to pay any additional fees for the     ences held by them. The victims of such
Law Firm              market – the largest risk for the foreign     construction works if the remuneration       formalism are often the international
                      business, including fi nancial risk. It        shall be paid in a lump sum.                 concerns – it is very hard for them to
                      might appear that they not sign a new                                                      understand why the offeror does not
                      contract, but also suffer a loss due to        The next barrier are the docu-               recognize the experience gained dur-
                      the withdrawal of the guarantee paid          ments, that the foreign entrepreneur         ing the accomplishment of any project
                      earlier by the offeror.                        must submit as a proof of fulfi lment of      by one of the subjects being part of the
                          The contract award procedures are         the conditions for participation in the      concern while the concern claims it
                      neither simple nor transparent, even for      proceedings and that the entrepreneur        to be the common good. According to
                      the domestic entrepreneurs – especially       is not excluded from the proceedings.        the provisions of the Public Procure-
                      at first contact. Moreover, the judicature     Th is barrier can result from an incor-      ment Law, the experience of one of the
                      decisions of the National Appeal Cham-        rect interpretation of the regulation on     group companies cannot be treated as
                      ber (KIO), currently the sole arbiter in      the types of documents by the offeror         the experience of the whole concern;
                      disputes between the awarding entity          and from the diversity of Polish legisla-    it can be used by this company being
                      and contractor in terms of interpreta-        tion and the country of company’s reg-       a part of the concern that submits an
                      tion and application of rules, are uni-       istered office of the offeror intending         offer, however, it must present the re-
                      form and often rather than avoidance          to make an offer. As an example may           quired documents. In such a case, the
                      of doubts make it stronger. Although to       be even a certificate on the payment of       incomprehension of the provisions and
                      the contractors granted a judicial way,       social security and health. In Poland,       in consequence calling the offeror to
                      but after one of the recent amendments        the body issuing such certifications is       fulfil the documents, can also end up
                      to legislation, the fee for application for   a state organisational unit – Social In-     in losing the deposit. Thus, shall the
                      KIO decision’s increased so drastically       surance Institution (ZUS). Issuing this      foreign entrepreneurs should omit the
                      that made this remedy illusory.               kind of certification is formalized. In       Polish public procurement market? Cer-
                          The first barrier that encounters the      other countries, especially where the        tainly, not. Nonetheless, if the offeror
                      foreign entrepreneur wishing to submit        system of social insurances has been         would like to submits an offer, should
                      a tendert is the language. The proceed-       privatized for a long time, there are no     be thoroughly prepared or in the best
                      ings are conducted in Polish and all doc-     counterparts of the Social Insurance         case find a proper partner that would
                      uments prepared by the offeror shall be        Institution, and the private insurance       safely shepherd them through the whole
                      prepared in Polish. This lengthens and        companies often smile at the request         mass of the rules and provisions.      ::

                                                                                                                           2/2011 :: polish market ::   79
 Powerful Businesswomen




                                               Time for changes,
    Do you see yourself as a univer-           Iwona Kossmann, President of the Board at Bonnier Business Polska,
    sal manager? Since you do have
    management experience in many
                                               talks to Rita Schultz
    industries - not so long ago from
    a telecommunications company,
    now you are leaving a fashion com-
    pany in favour of a media concern.
Yes, I do feel like a universal manager.       and not only in publishing. I think that                        and American. The experience gained
Being a manager is a profession some-          Bonnier should be looked at as a me-                            allows me to be a person who easily
what similar to being a doctor. I spring       dia conglomerate, working in many                               adjusts. But of course, I like some cul-
into action whenever there is a task, a        areas. These include both press and                             tures more and others less. I admire
business problem to be solved. Some-           other areas which don’t exist in Po-                            Scandinavian countries - this north-
times that takes 3 years, sometimes 5          land like book publishing and tele-                             ern part of Europe appeals to me for
or 7. In practice, when the problem is         vision, since Bonnier is the owner of                           many reasons: level of democracy in
solved then the given task is also over.       several TV stations (Canal+, TV4, and                           organisations, diversification, respect
    I think that good managers are by          MTV in Scandinavia belong to Bonni-                             for women, trusting her in advance,
defi nition those who are universal,            er Business). Th is group also has pro-                         something hard to fi nd in Poland. Of
open to new challenges. I belong to            duction houses and a very large enter-                          course, the age of equality reigns eve-
that group, I crossed from FMCG to             tainment business. They are a big fi lm                          rywhere, but it has not been imple-
telecom, then to fashion and now to            producer and owner of Svensk Film-                              mented there at the top yet. Manage-
the media. Someone can say that this           industri, the largest such company in                           ment is made up of men and a small
diversity in industries is too large. In-      Scandinavia. These are all the areas                            percentage of women, which I think
deed, they are not closely related, but        that have growth potential in Scan-                             should be changed. That’s why I try to
that is the true challenge, enabling me        dinavian countries, going beyond the                            help women wherever I go.
to show my abilities.                          present Bonnier Business Polska prod-                               I think that this is the role of wom-
    I think that there is a lot of commo-      ucts, such as “Puls Biznesu”, “Puls Me-                         en in business. The higher we get, the
nality between telecom and the media,          dycyny” and “Infor Media.”                                      more we should look at those sur-
and my 7 years in telecom will certain-                                                                        rounding us. Of course nothing should
ly help me to carry out my duties at              Does this mean that your goal is to                          be forced, if women lack competencies
Bonnier Business Poland. I am leaving             build a strong publishing house, so                          then they should not be promoted at
Deni Cler at a time when the compa-               strong that it will be able to com-                          all cost. You have to look for compe-
ny is profitable, results are much bet-            pete with, let’s say, German groups                          tent people, competent women, en-
ter than in 2009 and in 2008, these are           present in Poland?                                           sure diversification.
not two or three times growth rates            The goal is to build a strong media
but twentyfold. I think that in a situ-        group.                                                             Would you agree that business-
ation when all the stores are making                                                                              women are just as comfortable in
money, net profit is much higher than               And how much time do you give                                  upper management and can easi-
budget, I can comfortably make the                 yourself to accomplish this?                                   ly compete with men?
decision to change industry. The me-           I believe that this type of management                          Yes, I would and this is plainly visible.
dia are a very interesting and fascinat-       cycle lasts 7 years.                                            Having worked for a number of foreign
ing area, especially in the digital age.                                                                       corporations, I myself have a lot of ev-
                                                   That’s a good time, but it will re-                         idence that Polish female managers are
     And is this change not really a long-         quire introducing many changes.                             better than Polish male managers. We
     ing for greater challenge, a bigger       I am all about change. Change is a per-                         work harder and are more accurate.
     company and action on a larger            manent part of my life. It always has a                         Men in Poland are very “macho” and
     scale?                                    positive effect, that’s why I am happy
In a sense, yes. A longing for a greater       to get this chance.
challenge will always be there. Fashion
is a fascinating area, but has its lim-            You have functioned in different        I think that good managers are by definition those
its in Poland, and there is not enough             cultures. Do you experience cul-       who are universal, open to new challenges. I belong to
room for development, especially due               tural differences or do you adjust      that group, I crossed from FMCG to telecom, then to
to the crisis.                                     automatically?                         fashion and now to the media. Someone can say that this
     At this point, there is a task in front   I have worked with many national-          diversity in industries is too large. Indeed, they are not
of me to develop the business at Bonni-        ities: Dutch, British, French, Ger-        closely related, but that is the true challenge, enabling
er. The main issue is profitable growth,        man, Swedish, Norwegian, Turkish           me to show my abilities.

80 ::   polish market :: 2/2011
                                                                                                          Powerful Businesswomen




time for new challenges
even if we are led to believe that we
have a culture that promotes wom-
en, I think this is not the case. Wom-
en are promoted, but at lower levels.
Frequently they are not offered bigger
challenges due to the thinking that,
they are just women. I myself have met
with comments such as: “What do you
need this for? Why do you want to be in
upper management? You are a woman.”
I will leave this without a commentary.

    In your opinion, is there such a
    thing as a feminine management
    style?
Yes. I think women have a lot of em-
pathy and intuition. My experiences
show that you have to listen to your
inner voice, which says whether this
person is the right person, does this
person speak the truth or lie. I think
that you should look to see if the eyes
are saying the same thing as the lips,
and if not then we are not hearing the
truth. I think that, aside from empa-
thy and intuition, women have sever-
al important traits, such as emotional
intelligence, knowledge how to build
a complementary team, have an abil-
ity to share power, which is essential
in large management groups. Eve-
ryone wants to be part of the team,
but not the part which constantly
sits on the backseat, but spends some
time at the wheel. It is a great skill to
manage a team in that way, so that it
works properly even when you are
absent. There is a saying in the trade:
“manage from the back of the group,”
which means to take advantage of all
the team’s talents at different mo-           Iwona Kossmann
ments. We do not always need the             The president of BONNIER BUSINESS POLSKA
same thing. Additionally, women are
detailed, which is very important in         Graduated from the Warsaw School of Economics with a Master of Economic Sciences degree. Completed post-
business. My employees have always           graduate Management and Marketing studies at the Erasmus University in Rotterdam.
joked that I have a selective ability of
reading and fi nding errors.                  After serving for two years as the president of DCG S.A., she turned the money-losing company into a profit-
    I believe that you should bet on that    making one after a B2B segment was set up and export operations in Russia were launched. One of her most
which is feminine and not be a man in        significant accomplishments was the rebranding of Idea (Poland’s largest mobile telephone operator) into Or-
business. You have to bet on woman-          ange, which has subsequently become the No. 1 company on the telecommunication services market. In recog-
hood. Which does not mean that we            nition of her feat, she was named “Marketer of the year 2006” by the “Media&Marketing” Magazine. In 2008,
are not business-oriented. Let’s be          she was awarded the title of “Manager of the Decade” by the Mobile Net Magazine. In a prestigious ranking run
ourselves in business. Th is can pro-        by “Home&Market” economic magazine, Iwona Kossmann has been listed for four consecutive years as one of
duce fantastic results and great pro-        Poland’s most influential women.
fessional satisfaction.                 ::

                                                                                                                            2/2011 :: polish market ::   81
 History of Polish brands




The artistic spirit
The quality of Polish vodka has been recognised around the world since                    others to follow. Chopin embodies in-
                                                                                          dependence, authenticity, and dis-
the 15th century, when the production of vodka from rye began in Poland.                  tinction, qualities which clearly in-
The most widely used raw materials for the production of vodka today are                  spired the striking bottle design and
                                                                                          which are reinforced by the brand’s
cereal and potatoes. Then there comes the art of fermentation, distillation               uniquely creamy, full-bodied fl a-
and rectification.                                                                         vor from naturally grown potatoes.
                                                                                          Chopin Potato Vodka was awarded
                                                                                          with Double Gold Medal at the San
                                                                                          Francisco World Spirits Competition,
                                                                                          with 700 spirits judged at the largest
                                              The Chopin Distillery dates back            ever spirits competition in the United
                                              to 1896 and is located near the town        States. The Double Gold Medal is the
                                              of Krzesk in the heart of the Podlasie      highest award granted in competing
                                              region, one of Europe’s healthiest and      spirits categories.
                                              most fertile agricultural areas. The tra-        Now, the distinctive black-labeled
                                              dition of passing knowledge from gen-       potato spirit will be joined by red-
                                              eration to generation makes the spir-       -labeled Chopin Rye on the shelves
                                              its produced by Polmos Siedlce some of      of select U.S. retailers in March 2011.
                                              the most highly regarded in the world.      While U.S. consumers will have to wait
                                              As a producer of luxury goods, Pol-         until March to purchase Chopin Rye,
                                              mos Siedlce is probably the only one        a sneak preview awaited VIP guests at
                                              in Poland which controls the process        the Santa Barbara International Film
                                              at every step of the vodka produc-          Festival, of which Chopin Vodka was a
                                              tion: from the raw material procure-        major sponsor. “Chopin Red” enjoyed
                                              ment from the local farmers through         its red carpet debut at the festival Janu-
                                              distillation, blending, bottling and,       ary 27 – February 6. “The Santa Barbara
                                              fi nally, sale of the fi nished products      International Film Festival is a natural
                                              in the chain of Polmos retail stores.       choice for unveiling Chopin Rye,” said
                                              Strict control over the entire process      Dorda. “Chopin Vodka celebrates the
                                              guarantees high quality and authen-         artistic spirit in its many forms, wheth-
                                              ticity to our customers.                    er it’s the music of our namesake Fred-
                                                  The fl agship product of Polmos          eric Chopin or fi lmmaking or the art-
                                              Siedlce is Chopin Vodka. The world’s        istry that goes into crafting fine vodka.
                                              only luxury potato vodka came to the        We are delighted to introduce Chopin
                                              US market in 1997, creating a new cat-      Rye to the U.S. in the midst of a trib-
                                              egory of vodka and a new standard for       ute to artistic achievement.”            ::




82 ::   polish market :: 2/2011
Sinfonia Varsovia and Krzysztof Penderecki    Cultural Monitor




                                                                                                                                                        Compiled by Maciek Proliński

                                             The premiere of Krzysztof Penderecki’s song cycle in the Na-        The new film box from the Kino Polska TV
                                             tional Philharmonic in Warsaw closes the celebrations of the        Publishing House had its premiere on Jan-
                                             Chopin’s Year. The latest three-part vocal and instrumental         uary 27. It is a collection from the series
                                             work from one of the greatest contemporary Polish compos-           “Polish Film Hits” which includes legen-
                                             ers entitled “Powiało na mnie morze snów... - pieśni zadumy         dary Polish comedies directed by Andrzej
                                             i nostalgii / The Sea of Dreams Rushed Over Me - Songs of           Kondratiuk -”Hydrozagadka/ Hydrorid-
                                             Reflection and Nostalgia” was written to texts by the most           dle”, “Jak to się robi/ How is it done” and
                                             prominent Polish poets (i.e. Boleslaw Leśmian, Cyprian Ka-          “Wniebowzięci/ On cloud nine”. All with
                                             mil Norwid, Kazimierz Przerwa-Tetmajer, Leopold Staff, Ale-          English subtitles!
                                             ksander Wat, Kazimierz Wierzyński). It was three years ago
                                             when the first director of the Frederic Chopin Institute Grze-       Kondratiuk’s fi lms have a special
                                             gorz Michalski proposed Penderecki to compose the work.             place in the Polish fi lm industry
                                             The song cycle, on which Penderecki had worked more than            thanks to their direct and personal
                                             a year, was completed in late 2010. The piece is surprising -       features. The director has won rec-
                                             impressionistic and subtle. Simple, yet rich in nuances. ::         ognition as the creator of warm com-
                                                                                                                 edy of manners and later developed
                                                                                                                 his own style of cinematic expression
                                                    Poet Wisława                                                 outside of the main trend for which
                                                 Szymborska col-                                                 he has total responsibility - often be-       have become the works of “cult”,
                                                                                                                 ing not only a director, writer and           and the memorable acting duo - Jan
                                               lected the Order of
                                                                                                                 operator, but also a musician, editor         Himilsbach & Zdzisław Maklakie-
                                                 the White Eagle,
                                                                                                                 and production designer of his films.          wicz have remained the symbols of
                                                the highest Polish                                               The early films of Andrzej Kondra-             Polish comedy and hallmarks of that
                                                 state distinction,                                              tiuk collected in this Box, after years       creative period of the director.  ::
                                                  on January 17 at
                                                 the Wawel Royal
                                                            Castle.                                             The Syrena Theatre begins 2011 with the Polish premiere of the play – “The Shaw-
                                                                                                                shank Redemption”. It is a theatre version of the famous film from 1994, now placed
                                               Szymborska is the
                                                                                                                high in the rankings for the best film of all time.
                                               winner of the 1996
                                               Nobel Prize in Lit-                                                                                             The banker who is sentenced to dou-
                                               erature. Her poems                                                                                              ble life imprisonment is impersonat-
                                               are unique verses of                                                                                            ed by a young Polish actor - Mateusz
                                               deep intellectual re-                                                                                           Damięcki. Another featured actors
                                               flection, often containing a clear philosophical subtext. They                                                   include: Tomasz Sapryk, Andrzej
                                               are characterized by the precision of expression, concise-                                                      Pieczyński and Wojciech Malajkat.
                                               ness, frequent use of irony, paradox, contradiction, joke,                                                      “The Shawshank Redemption,” writ-
                                               and distance... Szymborska frequently raises moral issues                                                       ten by Owen O’Neil and Dave Johns, is
                                               and contemplates the sense of human existence. The poems                                                        based on the novel by Stephen King. It
                                               really open up new horizons and help to understand human                                                        is the story of the financier - Andy Du-
                                               psyche. Even though, Szymborska’s poetry has grown from                                                         fresne, who is wrongly sentenced for
                                               the Polish historical and geographical background, it can                                                       life imprisonment for murdering his
                                               be called “universal”. The poet is inextricably linked with                                                     wife and her lover. He goes to prison,
                                               Kraków and has repeatedly stressed her commitment to                                                            which is ruled by a ruthless director
                                               this city. The Nobel Committee in support of granting her                                                       and sadistic guards. Despite this fact,
                                               the award wrote: “Szymborska’s poetry with ironic preci-                                                        Andy does not break down. He pre-
                                               sion allows the historical and biological context to come                                                       pares a perverse plan for revenge that
                                               to light in fragments of human reality.”                    ::                                                  will surprise even his closest fellow
                                                                                                                                                               prisoners...                          ::

                                             84 ::   polish market :: 2/2011
                                                                                                                                        Cultural Monitor

 The exhibition “Naughty” can be seen in Kraków’s Bunkier Sztu-                        (Justyna Koeke, Zuza Krajewska), play with popculture codes
 ki Gallery until February 27. The presented works show Polish cul-                    (Karolina Kowalska), rebel against tradition (Laura Pawela)
 ture from the perspective of women rebelling against certain cultur-                  or expose the internal processes of naughtiness (Lidia Kraw-
 al and social norms.                                                                  czyk, Anna Niesterowicz). All these artists juggle cultural
                                                                                       roles, they react to situations and to painful problems and –
 This exhibition focuses on the emotions and the ways of ex-                           thanks to their finely-tuned sensitivity – create their own re-
 pressing them. Its aim is to show how many different forms                            ality of subcutaneous rebellion. They do not shy away from
 anger can take. The works were all created for the exhibition                         anger or rebellion. They are not afraid to challenge the tra-
 and come in a variety of media: from performance and in-                              ditional notion of femininity. They approach this in different
 stallation through photography and sculptures to video and                            ways. Often, their protest is not head-on. Sometimes, they
 painting. “The featured artists pitch themselves against his-                         simply pin down the social and cultural areas which gener-
 tory and cultural politics (Anna Maria Karczmarska, Agniesz-                          ate particular behaviour”, explains Lidia Krawczyk, curator
 ka Kurant), debunk the myth of the immaculate femininity                              of the event.                                                 ::


32nd Review of Stage Songs (PPA) will be held in Wrocław from
18 to 27 of March. The highlight of this year’s edition will be Me-
redith Monk, a legend from the circle of the New York avant-
garde, hailed “the voice of the sorceress,” and “one of the best
American composers.”

                                 She is bringing her “Songs
                                 of Ascension” show to
                                 Wrocław. Monk is to per-
                                 form with an international
                                 cast and Wrocław’s 40 peo-
                                 ple choir. A special show for
                                 the Review will be also pre-




                                                                                                                                                                             photo Era Jazzu
                                 pared by last year’s win-
                                 ner of the Grand Prix in
                                 Stage Song Interpretation -
                                 Zvezdana Novaković. Poles
will be also represented at the 32nd PPA. Arkadiusz Ja-
kubik’s “I” performance (in the repertoire of IMKA The-                     Omar Sosa - the brilliant Cuban pianist and composer, will be the fi rst guest
atre in Warsaw) should be one of the high points of the                     of the spring edition of the Jazz Age. His concert at the Warsaw Philharmonic
festival. Rapper L.U.C. will perform material from his al-                  in 2008 has won him a huge crowd of enthusiasts and promoted his wonderful,
bum “Pykycykytypff”, for the first time live and the Mu-                      exotic music in Poland. Th is time, Sosa will show up with his new team- Afri-
sical Theatre from Gdynia will amuse us with “Spamalot,”                    Lectric Quintet, featuring an electro-jazz star, the trumpeter Joo Kraus. On the
based on the Monty Python screenplay. This year’s gala is                   19th of March they are going to play the one and only concert in Poland at the
dedicated to the first lady of the Polish Song – Ewa De-                     Warsaw club Palladium.
marczyk. Demarczyk’s songs will be performed by the
best known Polish singers and actresses, including: Gaba                    Here is how Dionizy Piątkowski, the head of the Jazz Age, recommends Sosa’s
Kulka, Stanisława Celińska, Kinga Preis, Natalia Grosiak,                   concert: “Th is artist has merged into one cohesive and melodic sound all of the
Lora Szafran and Justyna Steczkowska. The Review of Stage                   good features of contemporary jazz: African rhythms, the impulsiveness of Lat-
Songs in Wroclaw is the largest Polish festival dedicated to                ino sounds, the sonoristics and unique features of classical jazz music, the mel-
actor’s song and musical theatre. It is also one of the big-                ancholy of blues and “buena vista” of his homeland. Omar Sosa has recorded
gest festivals of this kind in Europe and worldwide.         ::             over twenty sensational albums, which has become significant not only in the
                                                                            history of jazz, but in the history of all music genres.”                       ::



Bałka’s video projections at the Cen-                                                  Carrousel (2004), which was acquired        in recent years was his 2010 “How It
tre for Contemporary Art in Warsaw.                                                    in 2010 by the Tate Modern for its col-     Is” presentation at the Tate Modern in
                                                                                       lection, as well as BlueGasEyes.            London. For many years, he has been
The “Fragment” exhibition is on till April                                                  Bałka (b. 1958) is one of the most     travelling to the former concentration
3. It is the first comprehensive presen-                                                outstanding contemporary Polish art-        camps. The artist shoots a lot, howev-
tation of the video works of Mirosław                                                  ists. His works are in the collections of   er he uses only a few-second images,
Bałka to be held in Poland and world-                                                  the Museum of Art in Łódź, the Mu-          often nearly abstract ones. Some of
wide. Given the artist’s stated intent       The Centre will show the works that are   seum of Modern Art, Hirshhorn Mu-           them are unique shots of a recent mo-
to abandon further work in the field of       counted among the classics of contem-     seum in Washington, and the Moder-          ment. Many of them can be already
video art, the exhibition is also a retro-   porary art, such as Winterreise (2003),   na Museet in Stockholm. One of the          seen at the Centre for Contemporary
spective on a complete body of work.         composed of the films Bambi and Pond,      most prestigious awards for Bałka           Art in Warsaw.                       ::



                                                                                                                                        2/2011 :: polish market ::      85
 Cultural Monitor


Górecki’s music to accompany
the Warsaw Ballet...
After the first seasons at the Polish National Ballet, which brought three           composer himself used to joke that
                                                                                    his music is “just boring”... In reality
ballets directed by Krzysztof Pastor originally produced abroad, the time           though, owing to the repeatability of
has come for a project designed for the Warsaw company. The world                   musical motifs and their limitations,
                                                                                    everything in Górecki’s compositions
premiere of the ballet with music by Henryk Mikołaj Górecki – one of the            seems to have a non-trivial signifi-
greatest Polish composers, who died in November last year – will take               cance. Górecki speaks through “whis-
                                                                                    pering and rumbling tones”. Whereby,
place on March 27 at the Wielki Theatre-National Opera. “And the rain               his style is defined as simple, but at the
will pass...” - Pastor’s new production is the result of the choreographer’s        same time significant, communicative
                                                                                    yet sublime. Th is music really stimu-
need to comment on the things important for him and distinctively Polish            lates imagination. I personally con-
issues, always on his mind. Maciek Proliński brings a sneak peak at the             sider it “the best background for the
                                                                                    fi nals of Tarkovsky’s fi lms”. How the
event.                                                                              Warsaw Ballet will handle its unique
                                                                                    beauty, time alone will tell...
                                                                                        “Beatus vir” (probably best
                                                                                    known immediately after the “Sym-
                                                                                    phony no.3”) is characteristic for the
The production was inspired by                                                      political breakthrough period in Po-
historical events presented on several                                              land. The music written to the text
occasions by various Polish artists, as                                             of one of the five psalms dedicated
well as by Polish contemporary music,                                               to Pope John Paul II, was performed
which can convey very intense emo-                                                  for the fi rst time during the fi rst pa-
tions connected with these events.                                                  pal visit to Poland, in 1979. The sim-
“One of the assumptions of the Polish                                               ple one-piece composition arouses a
National Ballet’s renewed philosophy                                                full range of feelings - from the seri-
is working with music, which origi-                                                 ousness and power of the introduc-
nally was not composed for ballet, mu-                                              tion to the heavenly beauty pervad-
sic which brings innovative elements                                                ing the fi nale...
to ballet and inclines to seek new cho-                                                 “Kleines Requiem für eine Pol-
reography and means of expression,”                                                 ka” is one of Górecki’s little known
says Krzysztof Pastor. The outstand-                                                later compositions (1993). Its slightly
ing Polish choreographer has creat-                                                 enigmatic title was never explained
ed before a ballet to Henryk Mikołaj                                                by the composer. Its mystery is fur-
Górecki’s music – the legendary Sym-                                                ther underlined by the fact that in ad-
phony No.3 - first at the Wielki Theatre                                             dition to fragments fi lled with mel-
in Warsaw (1994) and afterwards in a                                                ancholy and sadness, some carefree
new choreographic version at the Het                                                dance fragments can be found.
Nationale Ballet in Amsterdam (1996).                                                   “St. Adalbert Cantata,” anoth-
The production did not tell any story,                                              er example of Górecki’s later compo-
but along with the great music it elic-                                             sitions (2000), grasps with its sim-
ited strong emotions, closely associ-                                               plicity. The piece is fused together by
ated with the dramatic Polish history.    sidus Polonorum op. 72” (“St. Adal-       the repeated “Alleluia” chant. It was
    This time, Pastor intends to use      bert Cantata”) for large mixed choir,     composed for Gniezno’s millennium
Górecki’s other compositions, those       organ, pianos and percussion ensemble     and the thousandth anniversary of
less known. The following will be used    (part III). The event, featuring Polish   St. Adalbert’s death. In the 1990s, the
in “And the rain will pass...”: “Beatus   National Ballet and the Choir and Or-     Saint was a patron of the European
vir op. 38”- psalm for baritone, mixed    chestra of the National Opera under       Union integration. The première of
chorus and grand orchestra, “Kleines      Wojciech Michniewski, is certainly        the Cantata took place on June 22,
Requiem für eine Polka op. 66” for pi-    worth seeing. Seemingly, there is not     2000 at the World EXPO Exhibition
ano and 13 instruments, and “Salve        much going on in Górecki’s music. The     in Hanover.                             ::

86 ::   polish market :: 2/2011
 Events




20 years of BCC
The Grand Gala of the Business Centre Club (BCC) took place in Wielki                                      from President of the Republic of Po-
                                                                                                           land Bronisław Komorowski, to its
Theatre – Polish National Opera in Warsaw, crowning the 20th edition of                                    participants. “Those honoured with
the Polish Business Leader Awards. The heads of the best Polish companies                                  the Polish Business Leader Statuette
                                                                                                           are an example of a modern, creative
received the Polish Business Leader Golden Statuettes. The awards were                                     thinking on economic matters. They
presented by: BCC President Marek Goliszewski, Prof. Leszek Balcerowicz,                                   are the leaders of that which ensures
                                                                                                           a stable, long-lasting growth in the
Chairman of the BCC Council of Organisers Jury Krzysztof Pawłowski                                         economy and abundance for our so-
and Chairman of the BCC Programme Council Maciej Grelowski. The BCC                                        ciety,” the President wrote.
                                                                                                               “We closed last year with as much
Special Award went to former Polish Prime Minister Leszek Miller.                                          as a 4% economic growth and 33 bil-
                                                                                                           lion profit from non-fi nancial enter-
Maciek Proliński                                                                                           prises. Th is is a twenty-year record,
                                                                                                           whose authors are fi rms nominated

BCC Special Awards are bestowed          being the last shift in this relay,” said
on outstanding personalities from        Prime Minister Miller. “But the re-
outside the business community for       lay is still running, now its goal is to
contributing to the development          bridge the gap to the richest countries
of business and the market econo-        of the EU. Th is cannot be realised
my in Poland. Among those already        without the active support of busi-
awarded are: Margaret Thatcher,          nessmen. Only permanent economic
George Bush, Jacques Chirac and Lech     growth can ensure this,” he added.
Wałęsa. Leszek Miller received the           The gala was attended by almost
award for “personally making the de-     two thousand invited guests, among
cision in 2003 to reduce business tax-   them, Polish businessmen, BCC
es from 27% to 19% increasing rev-       members, parliamentarians, diplo-
enue to the government budget, for       mats, scientists and publicists. The
the fi rst legislation on the freedom     Business Centre Club has been award-
to conduct business activities and for   ing the Polish Business Leader’s Gold-
introducing Poland into the European     en Statuettes since 1991. The recipi-
Union on terms advantageous to the       ents that maintain their position on
Polish economy and employers.” Re-       the market can run for a Diamond to
ceiving the award, the former Prime      the Golden Statuette in the following
Minister underlined that Poland be-      year, which is awarded during the
came an EU member on “the best           Grand Summer Gala of the BCC. Dur-
terms.” “The European dream was re-      ing the gala, the presidential minis-
                                                                                     Leszek and Ewa Balcerowicz
alised by several governments, mine      ter Olgierd Dziekoński read a letter

88 ::   polish market :: 2/2011
                                                                                                                          Events
                                                                              During the Grand Gala of Polish Business Leaders or-
                                                                              ganized by Business Centre Club at the Wielki Theatre
                                                                              in Warsaw, the prestigious Social Solidarity Medals were
                                                                              presented by Cardinal Kazimierz Nycz. This prize is be-
                                                                              stowed on socially engaged people. This year’s winners
                                                                              were Roman Nowicki and Maciej Owczarek.
                                                                                 Nowicki is the founder and benefactor of the Home-
                                                                              less Foundation established in 1990. The Foundation has
                                                                              directly contributed to establishing legal regulations on
                                                                              housing funds for underprivileged families and special
                                                                              aid for young families “first flat.”
                                                                                 Owczarek is the president of Enea SA, energy opera-
                                                                              tor, and the head of the Holding council at Enea Group.
                                                                              During his term in office Enea was involved in various
                                                                              forms of social aid including help for children, the sick
                                                                              and the needy, as well as non-governmental organiza-
                                                                              tions. It has also carried out numerous health care, ed-
                                                                              ucational and cultural campaigns against social exclu-
                                                                              sion and for the natural environment.



today for the title of the Polish Busi-      musical setting. During this year’s           BCC members, are the largest inter-
ness Leader. The national budget re-         Gala, Glenn Miller’s music was played         national corporations, fi nancial in-
ceived greater revenue – business-           by Zbigniew Namysłowski’s Big Band            stitutions, insurance and telecom-
men’s contributions to healthcare,           – one of the greatest Polish compos-          munications fi rms, the largest Polish
science, education. We also said last        ers and jazz saxophonists.                    manufacturers, higher educational in-
year that we have to diff use a ticking           The Business Centre Club (BCC)            stitutions, publishers, etc. More than
bomb – overstuffed public spending.           has existed since 1991. It was created        200 foreign companies belong to the
Poland will never be a power with            as a multifaceted institution, support-       club. According to research conducted
785 billion public debt and a 112 bil-       ing entrepreneurial Poles. It’s an elite      by the Centre for Market Research “In-
lion budget deficit. (...) A real repair of   club for businessmen and the larg-            dicator” (1997), the Institute of Public
government fi nances will be brought          est organisation of private employ-           Affairs (2000) and by Pentor Research
about through abolishing pension             ers. It has more than 1200 members,           International (2004 and 2005), the BCC
privileges, adjusting benefits to the         mainly private fi rms represented by           has become the most prestigious and
level of income, increasing retirement       close to 2000 businessmen, employ-            effective organisation of its kind in Po-
age, reducing VAT to 19%. Th is re-          ing 600 thousand employees. Among             land.                                  ::
quires going against the grain and
having the courage of Leszek Miller,
who reduced taxes, frequently against
the stance of his party and the elector-
ate,” said Marek Goliszewski.
    For the sixth time, Social Solidar-
ity Medals were handed out – awards
for individuals who are socially active,
helping the needy, propagating the
idea of social solidarity by business and
those building social solidarity. The
laureates were: Agnieszka Świergiel,
President and General Director of Im-
perial Tobacco Polska, businessman
Karol Cebula, Paweł Łukasiak, head
of the Board of the Academy for the
Development of Philanthropy in Po-
land and the ‘My Scholarship’ Foun-
dation, Roman Nowicki, founder and
donor of the Homeless Foundation
(created in 1990), Maciej Owczarek,
President ENEA SA, Chairman of the
Board of ENEA Holding Group. Med-
als were presented by Cardinal Kazi-
mierz Nycz.                                                                   The stand was designed and produced by
    Every BCC Grand Gala is dis-                 Qusette fashion show         Pracownia Sztuk Plastycznych
tinguished by a special artistic and

                                                                                                       2/2011 :: polish market ::     89
CEOs after hours




      Franz Fuchs
      Chairman of the Compensa Group

      My adventure with painting began when I was
      looking for some way to relax and unwind af-
      ter work. I discovered that going into painting
      would be an excellent idea. Apart from that, as I
      was looking for interesting modern works of art I
      couldn’t find any that I thought was worth buying,
      for at least a reasonable price. That was another
      motivation to take up painting myself. I was also
      prompted by the fact that the walls in the Cred-
      it Suisse Office for Central and Eastern Europe
      where I was working at the time, were bare and
      devoid of any pictures. So this is how I started
      to draw pictures and I do so to this day. Works
      by Franz Fuchs hang in my office also today.        Mariusz Stanek                     Leszek Gierszewski          Marek Kaliszek   Rafał Klama


      I am painting simply for myself, for my own
      pleasure. I don’t paint for money, at least not      Polish Business Leader 2010 Laureates:                                               Jan Krzysztof Bielecki

      for now. As regards masters of painting I like, I    :: AMITECH POLAND sp. z o.o.
      have been always most highly impressed by the          and the President of the Management Board Andrzej Pielaszkiewicz
      Impressionists, and in particular by Claude Mon-
                                                           :: Bombardier Transportation (ZWUS) Polska Sp. z o.o.
      et. I also treasure the works by Gustav Klimt,         and the President of the Management Board Sławomir Nalewajka
      my countryman.                                 ::
                                                           :: OSKAR EDUCATION CENTRE
                                                             and Director Wiesław Łubiński
                                                           :: DELIC-POL S.A.
                                                             and the President of the Management Board Rafał Klama
                                                           :: DRUTEX SPÓŁKA AKCYJNA
                                                             and the President of the Management Board Leszek Gierszewski
                                                           :: FARBY KABE POLSKA Sp. z o.o.
                                                             and the President of the Management Board Ryszard Szajter
                                                           :: MENTOR S.A.
                                                             and the President of the Management Board Marek Kaliszek
                                                           :: POLNORD SA
                                                             and the President of the Management Board Wojciech Ciurzyński
                                                           :: Przemysłowe Centrum Optyki S.A.
                                                             and the President of the Management Board Ryszard Kardasz
                                                           :: TOBACCO Trading International Poland Sp. z o.o.
                                                             and the President of the Management Board Mariusz Stanek
                                                           :: ZAKŁADY AUTOMATYKI KOMBUD S.A.
                                                             and the President of the Management Board Ryszard Szczygielski



                   90 ::   polish market :: 2/2011
 Events



CHARMETTA e D’ORO


         Alicja Resich-Modlińska, Katarzyna Niezgoda, Mariola Bojarska-Ferenc                                                               Joanna Sarapata, Polish artist


                                                                Deni Cler MILANO presented the Spring/Summer
                                                                2011 Collection on January 13, in Dom Dochodowy
                                                                (Profit-making Building), one of Warsaw’s historic
                                                                buildings transformed into an office-service space.
                                                                    Deni Cler MILANO combines classical elegance
                                                                and the latest trends. The collection was inspired
                                                                by the very feminine 1950s.
                                                                    “In the Spring /Summer 2011, as always, we
                                                                have taken care of all the details, form and fi n-
                                                                ish,” says Katarzyna Niezgoda, president of DCG
                                                                SA. “The proposed fabrics are based on natural fi-
                                                                bres - silk, cotton and linen.” There is also a soft
                                                                and malleable jersey, which has recently made a
                                                                triumphant return in fashion. A new feature is un-
                                                                doubtedly the technology of cold-dyeing, whose
                                                                effects recall watercolour patches.”


                                                                The Fashion Show Partners: Jacob’s Creek Australian Wine;
                                                                guests enjoyed the Audi VIP shuttle service.
                                                                                                                                         Justyna Steczkowska, Polish singer

                                                                      Andrzej Klesyk, president of PZU, Jerzy Mazgaj, businessman, Jacek Szmidt editor-in-chief of “Twój Styl”




92 ::   polish market :: 2/2011
Every now and then comes a mo-
ment when we feel we’ve had it. That
is the time when we realize we have
been working too hard, throwing in
over hours and overriding our bod-
ies and that is when we say: enough is
enough. It is time to rejuvenate!
    One of the top-rated spas offering
the most personalized spa experience
is SPA FENIKS.
    Located in eastern Poland, Nałę-
czów has exceptionally favourable mi-
croclimatic conditions. Th is health re-
sort takes advantage of the picturesque
environment, with an abundant loess
valley system, beautiful forests and
vast plains with enchanting rivers pro-
viding an excellent place to hide out,
relax, calm down and reduce stress.
    The climate in Nałęczów has heal-
ing properties and helps to treat heart
disease and depression. FENIKS blends
conventional medicine, climatic ther-



                                           We have one life
apy and natural medicine with re-
habilitation, beauty treatments and
rest. The combination of a low calorie
diet based on organic products im-



                                           and only one body
proves the general physical condition
and mental well-being. The treatment
programme is prepared individual-
ly for each guest by qualified doctors,
taking into consideration individual
expectations, skin condition, health
problems, age, etc.
    “The FENIKS Centre for Biological         “We have been developing our own              SPA FENIKS owner
Rejuvenation offers weight loss ther-       technologies for over 18 years. They              Halina Zubrzycka
apy and muscle toning. Th is includes      provide deep nourishment to the skin,                      MD PhD
a wide variety of manual massag-           tightening and strengthening of the
es, endermology, electrostimulation        face smile muscles, the tightening and
combined with deep heat, mezother-         closing of blood vessels which last for
apy and radio wave treatment. We of-       several years,” she adds.
fer cellulite treatment and improve-          The FENIKS Centre for Biological
ment of skin quality. These are carried    Rejuvenation invites guests to stay for
out using the spa capsule, lymphatic       five days and longer. People have been
drainage massage and magnetic field         coming to Nałęczów for nearly 200
treatment, hyper pressure exercises,       years to regain their health and energy.
treatment with radio waves and a wide      The city also has a rich history and in-
range of manual treatments. Our of-        teresting architecture which is a spir-
fer also includes therapy for bone and     itual and cultural “treatment.”        ::
muscle pains, predominantly using
hot message. The combination of heat
and relaxing message also relaxes and
calms the whole body. The swelling
of lower limbs is treated with manual
lymphatic drainage and then through
magnetic therapy. Our rejuvenation
therapies of the face and neck line are
very popular at the FENIKS Centre for
Biological Rejuvenation, because they                                  Telephone number & Fax: 081 50 14 863
give excellent results” says, owner                      WWW: www.spawraju.pl • E-mail: oob-feniks@home.pl
Halina Zubrzycka, MD PhD.                                 Address: 24-140 Nałęczów • ul. Lipowa 15 (Willa Raj)


                                                                                                                 2/2011 :: polish market ::   93
 Events



2010 Vector Awards
 At its annual ball held in
 the Hilton Hotel in Warsaw on
 January 15, 2011, the Confeder-
 ation of Polish Employers pre-
 sented its 2010 Vector Awards.
 These high distinctions are be-
 stowed on prominent entre-
 preneurs, politicians, men of
 culture and the arts whose per-
 formance serves as an example
 to others. Vectors are awarded
 for outstanding achievements
 that have brought special bene-
 fits to the Polish economy as well
 for creating a climate conducive
 to the development of entrepre-
 neurship.
                                                                                                   Laureats of the 9th edition of the Vector awards
     The following are the laure-
 ates of the 9th edition of the Vec-                                                            Dominika Kulczyk-Lubomirska and Grażyna Kulczyk
 tor awards (listed in order of pres-
 entation):

 Leszek Czarnecki
 president of the supervisory board at
 Getin Noble Bank

 Grażyna Kulczyk
 owner of Stary Browar (the Old
 Brewery) in Poznań

 Jan Krzysztof Bielecki
 president of the Economic Council at the
 Prime Minister’s Office

 Aleksander Findziński
 former director of the Polish Oil and Gas
 Company (PGNiG)

 Andrzej Haas
 president of Cypr ESL Hass Holding Ltd
                                                                  Andrzej Malinowski and wife
 Emilian Kamiński
 founder and director of Teatr Kamienica

 Jan Lubiński
 president of the management board at
 Read-Gene SA,

 The “Polityka” weekly
 Wojciech Balczun
 president of PKP Cargo SA


 To highlight the award-pres-
 entation ceremony, a concert of
 jazz and swing music in the gen-
 re of Frank Sinatra and Nat King
 Cole was rendered for the more
 than 400 guests by Wojciech
 Gąssowski.

 Photos: Katarzyna Rainka
                                             Krystyna Woźniak-Trzosek and Edward Trzosek                      Jan Lubiński and Andrzej Malinowski


94 ::   polish market :: 2/2011
 Events




                                                                                                                           The winners of the 2010
                                                                                                                    Laurels of Skill and Competence




The 19th Laurels of Skill
and Competence 2010 Award Gala
The Diamond, Platinum, Crystal and Golden Laurels of Skill and           TVN and Senator Maria Pańczyk-        is an increasing number of suc-
Competence were presented to the most distinguished members of the       Pozdziej, a promoter of Sile-         cessful entrepreneurs and this is
country’s political, economic, media, academic, cultural and artistic    sian culture. Bożena Lublińska-       particularly worth noticing in the
life on January 15, 2011 during a special gala event held in the House   Kasprzak, the president of the        times of crisis,” Bogusława Bar-
of Music and Dance in Zabrze, Southern Poland.                           Polish Agency for Enterprise De-      toszek, secretary of the chapter,
                                                                         velopment, was also honoured          emphasised.                      ::
                                                                         with the Platinum award.
                                                                             The chapter granted awards to
Śląski Wawrzyn (Silesian Laurel)     fi lm art. The Platinum Laurel in    as many as three socially respon-
– considered the most signifi-        “Pro Publico Bono” category was     sible companies. “This is very no-
cant award – was bestowed on         conferred on Kamil Durczok – ra-    ble and I am proud of the fact that
Krzysztof Zanussi, an outstand-      dio and TV journalist, present-     the number of winners in this
ing Polish director, the master of   er, the editor-in-chief of FAKTY    category is growing every year,”
                                                                         says Tadeusz Donocik, the presi-
                                                                         dent of the Chamber of Commerce
 President Tadeusz Donocik,                                              and Industry in Katowice. The
 the president of the chapter                                            Golden Laurels of Skill and Com-
                                                                         petence were also bestowed gen-             Śląski Wawrzyn 2010




                                                                                                                                                      Photo courtesy of the Chamber of Commerce and Industry in Katowice
                                                                         erously. There were 24 winners.             (2010 Silesian Laurel)
                                                                                                                     – Krzysztof Zanussi
                                                                         “The economy is expanding, there



                                                                                                                         Krzysztof Zanussi receives
                                                                                                                                the Diamond Laurel




96 ::   polish market :: 2/2011
                                                                                                                                   Economic Monitor



Economic Monitor
                                  December 2010

Main economic trends                                     10

The world economy is in a phase of reviv-
                                                                     1.5%           1.4%           1.0%           2.8%         3.1%            3.8%            4.7%
al. Poland is experiencing a relatively high,             5
compared to the European Union, rate of eco-
nomic growth. In 2011 a slight slowdown is
                                                          0
expected in the economic growth rate in Po-
                                                                   2009Q1         2009Q2          2009Q3        2009Q4       2010Q1          2010Q2          2010Q3
land and in the world.
     In 2010Q3, Poland’s seasonally adjusted1            -5
GDP grew by 4.7% year on year (by 4.2% on
a seasonally unadjusted basis). Th is was the
fourth quarter in a row, in which the rate of           -10
economic growth increased. Both the growth
in consumption and capital formation con-
                                                        -15
tributed to it. Total consumption, seasonal-
ly adjusted, grew by 4% year on year (3.7%                               Gross Domestic Product                Total consumption              Gross capital formation
in 2010Q2), while gross capital formation                                                                                          Source: Central Statistical Office (GUS)
increased by 8.2% (7.7% in 2010Q2). Pub-
lic consumption grew faster than individual            Fig. 1. GDP growth rate in Poland, seasonally adjusted, Qt/Qt-4
consumption. In both cases, a clear growth
trend occurred in 2010. The optimistic news            holds employing workers. Among the sec-                      rate of growth was recorded, however, in
also includes a growth in capital asset spend-         tions named, only market services, trans-                    Chile, Turkey and Mexico. The growth of
ing, which increased by 0.2% on an annu-               portation, storage and telecommunications                    NAFTA and G7 countries was slightly fast-
al basis. Even though this growth was not              developed faster than during 2010Q2, while                   er than that of OECD countries. The eco-
large, investment in capital assets had un-            the remainder slowed down.                                   nomic growth rate of developing countries
til recently been the only component of GDP                During 2010Q3, the real GDP of the econo-                slowed down slightly. The cause of this was
with no clear tendency of recovering from              mies of the USA, Japan and the EU grew faster                the more restrictive approach to econom-
the slowdown period, and back in 2010H1,               than in the previous quarter. The rate of GDP                ic policy of those countries, with the aim of
these investments were falling sharply. Dur-           growth in the USA amounted to 3.2% year on                   reducing the risk of increasing economic im-
ing 2010Q3, exports and imports also grew,             year (seasonally adjusted), compared to 3%                   balance. Favourable conditions exist, howev-
although the growth of imports increased               for the previous quarter. In Japan, it was 5%                er, in Germany, a factor that positively im-
slightly faster. Domestic demand grew by               compared to 3.5% for 2010Q2. The economic                    pacts on Polish exports.
4.8% on an annual basis.                               growth in the EU-27 amounted to 2.2%, com-                   Source: www.nbp.pl, December 2010
     Gross value-added (seasonally adjusted)           pared to 2% for the previous quarter. A slight-
grew during 2010Q3 by 3.2% year on year.               ly slower growth was noted by countries of                   The European Commission’s forecasts for 2011
The increase was strongly influenced by in-             the euro-zone (1.9% compared to 2% in the                    indicate a decrease in the economic growth
dustrial results, whose value-added increased          previous quarter). Among EU countries, dur-                  rate in the EU, which according to expecta-
by 7.8% year on year, as well as the results of        ing 2010Q3, the fastest growth was experi-                   tions, will amount to 1.7%, and in the euro-
transportation, storage and telecommuni-               enced by Sweden (6.8%), Estonia (5.1%), Po-                  zone (1.5%). A lower, but positive, growth
cations sectors – an increase by 5.6%. Con-            land (4.7%), Slovakia (4.2%), Germany (3.9%)                 rate is also expected in Japan and the USA
struction, trade and other services also ex-           and Malta (3.7%). A very weak situation exist-               – 1.3% and 2.1% year on year, respective-
perienced an increase, although at a lower             ed in Greece, where an increasing GDP decline                ly. Among EU countries, a relatively high
rate, while non-market services, which in-             can be observed; during 2010Q3, Greece’s GDP                 economic growth rate is forecast for Esto-
clude public administration, grew the least            growth was -4.6%. Negative growth was also                   nia (4.4%), Poland (3.9%) and Lithuania and
– their growth was 0.3% year on year, with             noted by Romania and Ireland.                                Sweden (3.3%). The most pessimistic fore-
similar tendencies in the social insurance                 The seasonally adjusted growth rate of                   casts concern Greece (-3.0%) and Portugal
sector, education, healthcare and house-               OECD countries was 3.1% year on year and                     (-1.0%), while the European Commission
                                                       was slightly lower than in 2010Q3 (3.2%).                    foresees a positive economic growth rate for
1   The Central Statistical Office (GUS) applies the   Among the OECD countries, aside from EU                      the remaining EU countries.
    TRAMO-SEATS procedure to seasonally-adjust time    member states, a negative economic growth                        The results of a survey conducted on a
    series.                                            rate occurred in Norway and Iceland. A high                  group of experts from all over the world by

                                                                                                                                         2/2011 :: Polish Market :: I
 Economic Monitor
  6.8


           5.1
                     4.7
                              4.2 3.9
                                                   3.7 3.5
                                                                     3.4
                                                                               2.8 2.7
                                                                                       2.5 2.5
                                                                                                                                      2.2 2.0                                                                                                                                          2.2 1.9
                                                                                                                                              1.9 1.8 1.7
                                                                                                                                                          1.6 1.4




                                                                                                                                                                                                                                                                   Romania
                                                                                                                                                                  1.3                                                                                                                            the Ifo Institute indicate a slight decline in the




                                                                                                                                                                                                                                                        Ireland
                                                                                                                                                                                                                        1.1




                                                                                                                                                                                                                                                                              Greece
                                                                                                                                                                                                                                    0.8 0.2                                                      world economic climate indicator in 2010Q4,
                                                                                                                                                                                                                                                                                                 compared to the previous quarter. Assess-
                                                                                                                                                                                                                                                                                                 ments of the current situation improved in


                                                                                                                                      Hungary
                     Poland


                                         Germany




                                                                                                 United Kingdom
                                                   Malta


                                                                     Denmark




                                                                                                                   Latvia
                                                                                                                            Austria


                                                                                                                                                Belgium


                                                                                                                                                                        France
                                                                                                                                                                                 Cyprus
                                                                                                                                                                                          Portugal


                                                                                                                                                                                                                Italy
                                                                                                                                                                                                                        Lithuania
                                                                                                                                                                                                                                    Bulgaria




                                                                                                                                                                                                                                                                                       UE
                                                                                                                                                                                                                                                                                            EA
  Sweden




                                                                                                                                                                                                                                               Spain
           Estonia


                              Slovakia




                                                           Finland


                                                                               Czech Republic




                                                                                                                                                          Netherlands




                                                                                                                                                                                                     Slovenia
                                                                                                                                                                                                                                                       -0.7
                                                                                                                                                                                                                                                                                                 2010Q4. At the same time, however, the in-
                                                                                                                                                                                                                                                                                                 dicator of the expected economic situation
                                                                                                                                                                                                                                                                  -2.2                           experienced a reduction in 2010H1. As a re-
                                                                                                                                                                                                                                                                                                 sult, despite the favourable economic climate
                                                                                                                                                                                                                                                                                                 in 2010Q4, the pick-up in the world econo-
                                                                                                                                                                                                                                                                             -4.6                my will likely proceed at a somewhat slower
                                                                                                                                                                                                                                                                                                 rate than in 2010H2.
                                                                                                                                                                                                                                                             Source: Eurostat
                                                                                                                                                                                                                                                                                                 Source: CESifo World Economic Survey,
Fig. 2. Seasonally adjusted change in GDP for 2010Q3, Qt/Qt-4, in EU countries (no data for Luxembourg)                                                                                                                                                                                          www.ifo.de)


  16%                                                                                                                                                                                                                                                                                            “The Leading Index (LI), informing in advance
  14%
                                                                                                                                                                                                                                                                                                 of future economic tendencies, increased in
                                                                                                                                                                                                                                                                                                 2010M12 by 2.8 points. At the same time, the
  12%
                                                                                                                                                                                                                                                                                                 process of rebuilding is complete, following
  10%
                                                                                                                                                                                                                                                                                                 the effects of the slowdown, and the econ-
    8%
                                                                                                                                                                                                                                                                                                 omy returned to its long-term growth path
    6%
                                         8.5                9.0                   9.4                                9.4               10.1                10.6                    10.4                  10.4                 10.7                     9.6                   9.7                 from before 2007. All components of the indi-
    4%
                                                                                                                                                                                                                                                                                                 cator worked in the direction of its growth”.
    2%
                                                                                                                                                                                                                                                                                                 Source: www.biec.org
    0%
                     -3.2
   -2%
   -4%                                                                                                                                                                                                                                                                                           Industry
                     2009                2010              2010                 2010                               2010                  2010                 2010                   2010                  2010                2010                2010                      2010
                     M12                  M1                M2                   M3                                 M4                    M5                   M6                     M7                    M8                  M9                 M10                       M11
                                                                                                                                                                                                                                                                                                 Following two months of decline, the annual
                     cumulative                                                                                   non-cumulative                                                                         Source: Central Statistical Office (GUS)
                                                                                                                                                                                                                                                                                                 rate of change in industrial sales at constant
Fig. 3. Change in industrial production, Mt/Mt-12                                                                                                                                                                                                                                                prices grew again in November. Most likely,
                                                                                                                                                                                                                                                                                                 this is the result of seasonal conditions being
 49.1                                                                                                                                                                                                                                                                                            unusually favourable to production growth
                                                                                                                                                                                                                                                                                                 this year. After adjusting for seasonality, the
                                                                                                                                                                                                                                                                                                 rate of industrial production was falling for
                                                                                                                                                                                                                                                                                                 the third month in a row.
                                                                                                                                                                                                                                                                                                     In 2010M11, industrial production grew
                                                                                                                                                                                                                                                                                                 by 10,1% year on year, while in 2010M10, the
                                                                                                                                                                                                                                          manufacture of machinery




                                                                                                                                                                                                                                                                                                 growth rate was at 8%. As a result, industri-
                                                                                                                                                                                                                                          transport equipment…
                                                                                                                                                                                                                                          of tobacco products…




                                                                                                                                                                                                                                          manufacture of other




                                                                                                                                                                                                                                                                                                 al production grew only slightly, which will
           18.3
                       17.1 15.8                                                                                                                                                                                                                                                                 not boost optimism in light of its sharp drop
                                                                                                                                                                                                                                          and equipment…




                                 15.4
                                                                                                                                                                                                                                          of beverages…




                                                           14.4 12.7
                                                                                                                                                                                                                                                                                                 during 2010M10. In 2010M1-11, industrial pro-
                                                                                                                                                                                                                                          of furniture…
                                                                                                                                                                                                                                          manufacture



                                                                                                                                                                                                                                          manufacture

                                                                                                                                                                                                                                          manufacture




                                                                                                11.6 11.5
                                                                                                                               9.9 9.8                                                                                                                                                           duction grew by 9.7% in comparison to the
                                                                                                                                                          6.5 6.3 6.3
                                                                                                                                                                      5.5 5.3                                                                                                                    same period in the previous year. In com-
                                                                                                                                                                                                                            0.2                                                                  parison, during 2010M1-10, the growth was
                                                                                                                                                                                                                                                                                                 9.6%. Seasonally adjusted production, how-
                                                                                                                                                                                                                                                                                                 ever, grew considerably slower than during
     pharmaceutical products…
       of computer, electronic…




     manufacture of fabricated
                     manufacture




          manufacture of motor

         manufacture of rubber

      manufacture of electrical



      manufacture of chemicals



      printing and reproduction

           manufacture of wood
            and cork products…

         and related products…
           manufacture of basic
          manufacture of paper




          vehicles, trailers and…

          and plastic products…

                     equipment…




                     manufacture
                 of basic metals…

             of recorded media…


         manufacture of leather



                     manufacture

                     manufacture
                      of textiles…
           manufacture of coke
        and refined petroleum…
                     manufacture
           manufacture of other




              of food products…
           and paper products…

 non-metalic mineral products…




                metal products…

       and chemical products…




            of wearing apparel…




                                                                                                                                                                                                                                          -2.2 -2.9
                                                                                                                                                                                                                                                                   -5.7
                                                                                                                                                                                                                                                                                                 prior months. It increased by 7.3% during the
                                                                                                                                                                                                                                                                                 -7.1            period of 2009M11-2010M11, which signals a
                                                                                                                                                                                                                                                                                                 decline in the growth rate by 3.8 percentage
                                                                                                                                                                                                                                                                                         -16.6   points in comparison to that calculated for
                                                                                                                                                                                                                                                                                                 the period of 2009M10-2010M10. Seasonal
                                                                                                                                                                                                                                                                                                 factors worked unusually favourably on this
                                                                                                                                                                                                                                                                                                 year’s production and, in their absence, we
                                                                                                                                                                                                                                                                                                 are observing an industrial slowdown.
                                                                                                                                                                                                     Source: Central Statistical Office (GUS)
                                                                                                                                                                                                                                                                                                     “Industrial work efficiency, measured by
Fig. 4. Growth in selected manufacturing areas, cumulative, Mt/Mt-12                                                                                                                                                                                                                             the value of products sold per employee, was

II :: Polish Market :: 2/2011
                                                                                                                                  Economic Monitor




                                                      25
10.6% higher in 2010M1-11 than in the same
period last year.”                                    20
Source: Information on the socio-economic
situation of the country. November 2010,
                                                      15
www.stat.gov.pl

                                                      10
Its growth rate was similar across the entire
2010M1-10 period, and 2010M11 did not bring
                                                       5
any considerable change in this respect. The
annual change in new industrial orders dur-
                                                       0
ing 2010M11 actually decreased compared to
2010M10. After seasonal adjustment, howev-
                                                      -5
er, the inflow of new orders over the last three            2009    2010    2010 2010       2010    2010    2010     2010     2010    2010    2010    2010     2010
                                                           M12      M1      M2   M3         M4      M5      M6       M7       M8      M9     M10     M11      M12
months was stable.
    2010M11 was another month in a row of a                 general business climate        production            expected order book
                                                                                                                                 Source: Central Statistical Office (GUS)
slowdown in the growth of durable consumer
goods sold. Although, on an annual scale, the     Fig. 5. Business climate indicators in the manufacturing sector
sales of these goods continue to increase, this   Forecasts are a prognosis for the next three months and because they concern three months and not one, they were
increase is much slower than during the pri-      indicated for the period in which the research was conducted, and not for the forecasted period
or months. The annual growth rate amount-
ed to 2.1% for 2010M11, compared with 9.9%        production rate slightly increased, breaking                  agers and a less pessimistic than the month
in the prior month, while the same rate was       a declining trend. Strong growth occurred,                    before evaluation of the extent of fi nancial
above 30% during the midpoint of the year.        however, in the case of water supply, waste                   obligations. The stagnation, observed since
Following a decline in the prior month, in        management and land reclamation.                              2010M4, still concerns the evaluation of the
2010M11 the rate of change in the produc-             Among the 22 chosen areas of industri-                    production volume and order books. In the
tion of non-durable consumer goods, whose         al manufacturing, a year-on-year decrease                     case of manager expectations for the situation
sales grew by 6.7%, increased. In their case,     in production was observed in just 5 during                   of the manufacturing industry in the com-
the rate of growth continues to be lower than     2010M1-11 (cumulatively). The greatest de-                    ing three months, both the order books and
during 2010M8, which for now indicates that       crease occurred in the production of other                    production volume estimates have improved.
the present growth does not indicate a stable     transport equipment (16.6%) and beverages.                    Weak forecasts concern, however, the gen-
tendency. The sale of investment goods grew       A strong growth was observed in computer,                     eral economic situation, fi nancial obligations
faster for 2010M11 by 8.9% year on year. How-     electronics and optical equipment produc-                     and employment. On the positive side, indi-
ever, in the case of these goods, the rate of     tion (49.1%), and also in the production of pa-               cators of expectations in the majority of ar-
production increase has constantly declined       per and products from leftover non-metal-                     eas are positive, confi rming that the major-
since 2010M7, although the decline has been       lic mineral resources. In comparison to the                   ity of managers expect an improvement in a
very gradual. The sales of intermediate goods,    growth for 2010M1-10, the production in 11                    given aspect of business. Only employment
however, are growing successively and at a        branches fell, while growing in the remain-                   is judged negatively, indicating that the ma-
constantly increasing rate. Their growth dur-     ing. We are therefore not observing the spread                jority of managers in manufacturing is more
ing 2010M11 amounted to 18.6%. The sales of       of any strong negative or positive impulses,                  likely to reduce employment than to increase.
energy goods were 1.3% lower than a year ago.     that would signal any clear perspectives of a
In relation to September and October 2010,        growth or decline in industrial manufactur-
the decrease was slightly smaller.                ing production.                                               Construction
    During 2010M1-11, the rate of change in
industrial sales exceeded that from 2010M1-       After several months of stabilisation in eval-                Sales in the construction industry are grow-
10 in the supply and production of electric       uations of the situation in manufacturing, in                 ing faster. The shortfall in 2010M10 was only
energy, gas, steam and hot water (amounting       2010M12 we are observing their improvement.                   an adjustment to the growth trend.
to 0.3%), as well as water supply; sewage and     It is, however, too weak a signal to conclude a                   In 2010M11 the growth rate in revenue in
waste management; land reclamation activ-         lasting improvement in this sector, and espe-                 construction increased slightly and amount-
ities (amounting to 6%). Mining production        cially in production growth for 2011.                         ed to 14.2% year on year, compared to 9.4%
rose more slowly than during 2010M1-10 (at             A seasonally adjusted indicator of the gen-              during 2010M10. This is the largest growth ex-
a rate of 2.2%), however, the industrial man-     eral climate in the manufacturing industry                    perienced since exiting the downturn caused
ufacturing production rose at the same rate –     grew for 2010M12, breaking away from sev-                     by the economic crisis. In cumulative terms,
10.9%. In 2010M11 alone, mining production        eral months of stabilization. Contributing                    construction output grew during 2010M1-11
fell on an annual basis and, at the same time,    to its growth were a more favourable evalu-                   for a second month in a row and at an even
a growth trend, observed for a longer time,       ation of the expected general economic situ-                  faster rate than in October 2010. It was 2.3%
was stopped. The industrial manufacturing         ation provided by industrial company man-                     higher during this period than in the previ-

                                                                                                                                       2/2011 :: Polish Market :: III
 Economic Monitor




20%
                                                                                                                                    sale and rent grew, while the number for in-
 15%                                                                                                                                dividual and co-operative housing fell. The
 10%                                                                                                                                number of completed dwellings fell during
          3.7                                                                                                                       2010M1-11 compared to the same period in
                                                                                                                       2.3
  5%                                                                                                           0.2                  2009 by 16.1% (compared to a fall of 17.1% a
                                                                                                                                    month earlier). In this case the situation of
  0%
                                                                                                                                    individual housing presents itself the most
 -5%                                                                                                  -1.5                          favourably.
                                                                                           -3.4
-10%                                                                -6.1         -5.7
                                                          -8.7                                                                      The business climate in construction is get-
-15%                                                                                                                                ting worse. Despite a growth in sales, con-
                                              -11.5
                                                                                                                                    struction fi rms are still in a dire situation.
-20%                                -15.2
                 -15.3                                                                                                                  During 2011M12, pessimism grew in the
-25%                                                                                                                                manager evaluation of the construction in-
                          -20.9
                                                                                                                                    dustry’s situation. The seasonally adjusted in-
                                                                                                                                    dicator of the general climate fell quite sharply
         2009      2010      2010      2010        2010          2010      2010         2010      2010       2010     2010          and reached its lowest value in 2010. Th is was
         M12        M1        M2        M3          M4            M5        M6           M7        M8         M9      M10           caused by pessimistic and worse than a month
         cumulative                         non-cumulative                               Source: Central Statistical Office (GUS)   earlier economic expectations in all the main
                                                                                                                                    construction branches. There is a majority of
Fig. 6. Change in construction output, Mt/Mt-12                                                                                     those surveyed that are noting a decline over
                                                                                                                                    those that are noting an improvement in the
  20
                                                                                                                                    situation. Th is concerns both the evaluation
                                                                                                                                    of the present situation, and the predictions
                                                                                                                                    for the next three months. Financial situa-
  10
                                                                                                                                    tion received the poorest evaluation results.
                                                                                                                                    The general economic situation was judged
   0
                                                                                                                                    slightly better, but still negatively. Based on
                                                                                                                                    the opinions of managers polled, an employ-
 -10                                                                                                                                ment reduction can be foreseen in this sector
                                                                                                                                    in the coming months. Production and order
 -20                                                                                                                                books, which were looked up with controlled
                                                                                                                                    optimism in prior months, during 2010M12
 -30                                                                                                                                were rated much worse, although still better
        2009     2010     2010      2010    2010      2010       2010     2010      2010       2010     2010   2010    2010         than the remaining components.
        M12       M1       M2        M3      M4        M5         M6       M7        M8         M9      M10    M11     M12
         general business climate             output                    expected domestic order book
                                                                                    Source: Central Statistical Office (GUS)
                                                                                                                                    Retail Trade
Fig. 7. Business climate indicators in the construction industry
Forecasts are a prognosis for the next three months and because they concern three months and not one, they were                    During 2010M11, retail trade in goods at
indicated for the period in which the research was conducted, and not for the forecasted period                                     constant prices grew year on year, although
                                                                                                                                    slightly slower than a month before. Growth
ous year. Cumulatively, growth was also not-                        improved in the number of dwellings for                         is noted for the majority of retail goods.
ed in all three construction branches, which                        which building permits were issued, as well as                      Retail sales, at constant prices, grew by
indicates an improvement in relation to the                         in the number of completed dwellings. How-                      6.1% year on year during 2010M11, which
prior quarter, when growth occurred in just                         ever, growth declined in the number of new                      means a slight slowdown compared to a
one branch. Th is is the result of a high growth                    home starts. The number of new home starts                      month before, when it amounted to 6.4%.
in sales for 2010M11 itself. The highest growth                     during 2010M1-11 still increased on an annual                   In cumulative terms, sales growth has been
is noted in the case of specialised construc-                       basis, despite the fall in its growth rate, and                 accelerating since the middle of the year,
tion activities (7.8% cumulative, year on year),                    it was relatively high at 11.5% year on year                    which amounted to 2.2% during 2010M1-11.
less in the case of civil engineering (1.5% cu-                     (compared to 12.6% in the prior month). The                     Wholesale sales, at current prices, grew by
mulative) and in the construction of build-                         number of dwellings that received building                      11.3% during this period, and 18.4% during
ings (0.4% cumulative).                                             permits fell during this period by 1.9%, on                     2010M11 alone, indicating an improvement
    Residential construction is very slowly                         an annual basis (compared to a fall of 3.3%                     over prior months.
recovering from the 2009 slowdown. During                           during 2010M1-10). Among the permits is-                            Among 9 groups of goods, retail sales dur-
2010M11, compared to 2010M10, the growth                            sued, the number of dwellings destined for                      ing 2010M1-11 declined on an annual basis in

IV :: Polish Market :: 2/2011
                                                                                                                                                                                                                                  Economic Monitor




three, while growth was noted in the rest. The
                                                     8%
fastest growing, similar to October 2010, are
sales of furniture as well as of personal elec-      6%
tronics and appliances, while the greatest                              2.7
decline occurred in the case of newspapers,          4%
                                                                                                                                                                                                                                                         1.9               2.2
books and other goods sold though specialised                                                                                                                                                                                                  1.5
                                                     2%                                                                                                                                   0.7                                         0.8
stores. During 2010M11 alone, the annual sales                                                                                      0.3                                                                             0.2
decreased for two product groups. In com-            0%
parison to the rates of change from 2009M10-
2010M10, this is an improvement since a de-         -2%                                                                                                   -0.5      -0.1
crease was then noted in 6 product groups.                                              -1.1
                                                    -4%                                                   -1.6

A weak optimism ruled the automotive trade                          2009             2010                 2010                      2010              2010          2010                  2010                      2010             2010      2010     2010               2010
and repair business during 2010M12. The first                        M12               M1                   M2                        M3                M4            M5                    M6                        M7               M8        M9      M10                M11
months of 2011, in the opinion of automotive                          cumulative                                                              non-cumulative                                                                     Source: Central Statistical Office (GUS)
retail managers, will be worse than those to-
wards the end of 2010, seasonal variations         Fig. 8. Change in retail sales, Mt/Mt-12
aside.
    The seasonally adjusted indicator of the
general climate in the automotive trade and
repair sector was 1.8 points, and was 1 point




                                                                                                                                                                                                                                                        remaining goods…
                                                                                                                                                                                                                          food beverages
lower than a month before. The decline was




                                                                                                                                                                                                                          and tobacco…




                                                                                                                                                                                                                                                        newspapers,
mainly caused by worse than 2010M11 fore-                 23.4
casts. In 2010M12 itself, the assessments of




                                                                                                                                                                                                                                               other…



                                                                                                                                                                                                                                                        books,
                                                                                     16.8                   14.0                                                   4.8                         4.8
the sales volume and fi nancial obligations was                                                                                             13.3
pessimistic but better than a month before. In
the case of the second component of the gen-
                                                                                           footwear…
                                                          household appliances…




                                                                                                                 pharmaceuticals
                                                                                                            cosmetics, equipment…


                                                                                                                                                 other retail




                                                                                                                                                                                                    automobiles,
                                                                                                                                          sales conducted…



                                                                                                                                                                   and gasseous…



                                                                                                                                                                                               motocycles, parts…
                                                                                    textiles, clothing,




                                                                                                                                                                  solid fuels, liquid
                                                            furniture,electronic,




                                                                                                                                                                                                                           -2.7
eral climate indicator, there is still a consid-
                                                                                                                                                                                                                                              -6.1        -17.9
erable majority of pessimists over optimists.
During the fi rst months of 2011, it is expected
that this aspect of business will continue to
negatively affect automotive trade. Based on
the opinions of those polled, a fall in employ-
ment is also expected for automotive trade                                                                                                                                                                                       Source: Central Statistical Office (GUS)
during this period. Weak optimism dominates
when it comes to demand and sales. Despite         Fig. 9. Change in retail sales of selected goods for 2010M1-11, Mt/Mt-12
this optimism, it is still a fall in comparison
to research from prior months.
                                                     10


                                                      5
Consumer Confidence

The Current Consumer Confidence Indicator              0
(BWUK), calculated by GUS, slightly rose after
a three month stabilization at a similar lev-        -5
el. The same is true of the Leading Consumer
Confidence Indicator (WWUK), it increased            -10
slightly and indicates that consumers are ex-
pecting a slight growth in individual con-          -15
                                                                       2009            2010 2010                             2010                2010            2010                   2010            2010              2010             2010 2010 2010 2010
sumption by next year.                                                 M12              M1   M2                               M3                  M4              M5                     M6              M7                M8               M9  M10 M11 M12
    The Current Consumer Confidence Indica-
                                                                     general business climate                                             sales                      expected demand
tor amounted to 18 points for 2010M12, which                                                                                                                                                                                    Source: Central Statistical Office (GUS)
still translates into a considerable majori-
ty of pessimistic consumers over those who         Fig. 10. Business climate indicators in automotive sales and service
are optimistic about their consumption ten-        Forecasts are a prognosis for the next three months and because they concern three months and not one, they were
dencies. After a sharp fall during the summer      indicated for the period in which the research was conducted, and not for the forecasted period


                                                                                                                                                                                                                                            2/2011 :: Polish Market :: V
 Economic Monitor




                                                  13.5

                                                  13.0
season, it was only during the last month that    12.5
the indicator grew, although only slightly.
The Leading Consumer Confidence Indicator          12.0
also grew by a slight amount during the last      11.5
month. “The favourable change in consumer
confidence was the result of an improvement        11.0
in the majority of underlying factors that de-
                                                  10.5
termine consumer moods. In December 2010,
                                                         2009 2009 2009 2009 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010
consumers more favourably assessed the ex-                M9 M10 M11 M12 M1        M2 M3     M4   M5   M6 M7     M8   M9 M10 M11
pected (for the next 12 months) changes in the
                                                           seasonally un-adjusted            seasonally adjusted           Source: Central Statistical Office (GUS)
                                                                                                                          Source: Central Statistical Office (GUS)
fi nancial situation of their households as well
as the existing (in the last 12 months) and ex-   Fig. 11. Registered unemployment rate, %
pected (in the following 12 months) chang-
es in the economic situation of the country.          During 2010Q1-3/2009Q1-3, investment                       The registered unemployment rate (claim-
Consumer assessment of their ability to save      in capital assets, at current prices, grew only            ant count rate) in 2010M11 was 11.7% and was
money (in the next 12 months) declined. No        in the case of transport equipment, fell in the            by 0.3 percentage points higher than a year
material changes took place in their assess-      case of buildings and structures, and also ma-             before, which was the result of the growth
ment of their household fi nancial situation       chines and equipment. At constant prices,                  in economic activity during the last year. In
(in the last 12 months) and expectations (in      the decline was smaller, however it did occur              comparison to 2010M10, the unemployment
the following 12 months) of changes in un-        (decline in capital asset spending by 10.6%).              rate was 0.2% higher, a consequence of sea-
employment”.                                      In 2010Q3 alone, compared to the situation                 sonal changes. After eliminating seasonali-
Source: Consumer confidence. December 2010,        a year ago, investment spending at current                 ty, the unemployment rate was at a similar
www.stat.gov.pl                                   prices increased for all the above categories              level for three months. The inflow of the re-
                                                  of capital assets.                                         cently unemployed still remained at a high
The BIEC Prosperity Index, which had been             Market sentiment research, conduct-                    level, although in recent months it decreased
growing since 2010M3, in 2010M12 remained         ed by GUS, indicates that based on the es-                 slightly. During 2011M11, 3.9% fewer unem-
at a similar level as the month before. Despite   timates from managers in the industrial                    ployed were registered by employment agen-
the positive effect of growing employment in       sector investment spending for 2010 grew                   cies than during the prior year. After a sev-
the industrial sector and wages, higher infla-     by 19%. In comparison to 2009, econom-                     eral-month-long decrease, 2010M11 was the
tion had contributed to its slowdown.             ic sentiments have improved in this area.                  second month in a row where the number of
                                                  In construction, managers are indicating a                 unemployed registered who had lost their
                                                  decrease in investments by 16.2% for 2010.                 work due to reasons on the employer’s side
Investment                                        Th is is, however, an improvement in the eco-              remained unchanged (based on seasonal-
                                                  nomic outlook compared to research con-                    ly adjusted data). The outflow of the unem-
Investment spending, at current prices, dur-      ducted during 2010M3, where the decline                    ployed from employment agencies, especially
ing 2010Q1-3 was 13.2% lower than in the          in investments was estimated at 26.5% for                  due to taking on a job, has been decreasing for
same period last year. Th is is the result of a   2010. Manager expectations in terms of in-                 some time. The number of unemployed that
slump in investment at the beginning of 2010.     vestment spending in the trade and services                found a job was 10.7% higher than a year be-
During 2010Q1-investment fell year on year,       sectors are optimistic at the outset of 2011.              fore. The rate of this is three times lower than
clearly reacting to changes in the wider econ-    In trade, this optimism is somewhat lower                  during 2010M3. The BIEC Future Unemploy-
omy in a delayed manner. During 2010Q3 it-        than it was for 2010 while services show a                 ment Rate Index is continually falling, which
self, investments grew by 6.5% year on year,      clear improvement. The scale of investment                 means pressure on unemployment reduction
which is likely a sign of their recovery.         spending will be negatively affected in the                 caused by economic factors that will act posi-
    During 2010Q1-3 investment spend-             coming months by seasonal changes on the                   tively at the beginning of 2011, although their
ing fell in industry, construction, trade and     one hand, while being favoured by market                   strength may diminish somewhat.
transportation, the fastest decline was in        sentiment on the other.                                        The employment rate according to LFS,
trade, and the slowest in transportation. In                                                                 seasonally adjusted, remained at the same
2010Q3 alone, the annual change in invest-                                                                   level for 2010Q3 as a quarter before, follow-
ment spending was positive in the majority of     Job Market                                                 ing a decline since 2009Q1. The average em-
branches, however, the highest was in con-                                                                   ployment rate in the economy grew by 1.4%
struction, amounting to 54.1%. Also, a pos-       The seasonally adjusted registered unemploy-               year on year for the second quarter in a row,
itive growth in investments for the analysed      ment rate in 2010M11 remained at the same                  as did the number of employed (up by 1.7%
period occurred in industry and transporta-       level as in the previous month. Seasonal fac-              year on year, based on data for the end of
tion (4.1% and 4%, accordingly). A decline is     tors are having a negative impact while mar-               2010M9). The economic activity rate has indi-
observed, however, in trade (reduction in in-     ket forces are favouring an improvement on                 cated a very strong growth tendency for sev-
vestment spending by 13.5% per year).             the job market.                                            eral years that, following an acceleration dur-

VI :: Polish Market :: 2/2011
                                                                                                                                          Economic Monitor




Table 1. Selected labour market indicators

                                                                                 2009M11       2009M12          2010M3       2010M6      2010M9        2010M10          2010M11
 Average employment in the enterprise sector in thousands                           5,265          5,255           5,294       5,336       5,364           5,375            5,381
 Annual rate of change in average employment                                           2.4          –2.0%          –0.6%        1.1%         1.9%            2.1%             2.4%
 Average nominal wage in the enterprise sector in PLN                            3,403.92       3,652.40       3,493.42      3,403.65    3,403.68       3,440.22         3,525.67
 Annual rate of change in real wages                                                –1.0%            2.9%           2.1%        1.3%         1.3%            1.2%             1.1%
 Registered unemployment rate                                                       11.4%          12.1%           13.0%       11.7%       11.5%           11.5%           11.7%*
 Annual change in the number of job offers by public employment agencies             –9.4%         –11.5%           25.2%       15.1%       12.6%           17.3%            11.9%
 LFS* employment rate                                                                    –         50.4%           49.4%       50.4%       51.1%                 –                –
 LFS* unemployment rate                                                                  –           8.5%          10.6%        9.5%         9.1%                –                –
 LFS* economic activity rate                                                             –         55.1%           55.2%       55.7%       56.2%                 –                –
* Quarterly data                                                                                                                              Source: GUS, plus additional calculations




ing 2010H1, somewhat weakened in 2010Q3                        number of job ads in 2010 was considerably                    coming out of recession very slowly while
(seasonally adjusted data). But the rate was                   higher than in 2009.                                          many countries are facing budgetary prob-
still considerably higher than a year earlier.                     The average nominal wage in the enter-                    lems, which limit their ability to pursue an
Th is is good news for GDP, as well as the na-                 prise sector in 2010M11 was PLN3525.67. It                    expansive policy in an effort to create demand
tional budget. A slowdown in the growth of                     was higher by 3.6% than a year earlier, which                 in the economy and reduce unemployment.
this indicator contributed to a reduction in                   was a slightly slower growth than during the                  Th is also contributes to pushing consumer
the inflow rate of the newly unemployed in                      prior month. In comparison to 2010M10, the                    demand down.
recent months.                                                 seasonally adjusted wages fell by 0.1%. Real
    2010M11 was another month in a row of                      wages grew by 1.1% year on year, in a third
an increase in the average employment in                       month in a row witnessing a slight reduction                  Prices
the enterprise sector. It was higher by 2.2%                   in their growth rate. From 2010M3, real wag-
than a year earlier. Seasonally adjusted em-                   es are growing very slowly. The lack of a sig-                The harmonised index of consumer prices
ployment was higher than during 2010M10                        nificant fall in unemployment during a time                    (HICP) was 2.6% in Poland for 2010M11 and
by 0.2%, which means a growth by approx-                       when the economic activity rate is high results               did not change in relation to the previous
imately 12,300 people. Since the beginning                     in a considerable bargaining advantage on the                 month. It was also the next month in a row
of the year, employment was showing a clear                    side of employers. As a result, even in condi-                where it was higher than the average for the
growth trend.                                                  tions of rapidly growing labour productivity,                 EU (2.3%). Again, backing its growth were
    The job market is going through a sea-                     a strong real wage growth tendency does not                   increasing food and energy prices.
sonal slowdown. During 2010M12, employ-                        materialise. Th is favours the growth of em-                      The annual rate of change in consumer
ers published fewer job offers on the Internet                  ployment in the enterprise sector.                            prices in the EU, and also in the euro-zone,
than they had done a month before. Despite                         The global unemployment rate remains                      did not change during 2010M10-2010M11. In
this, the percentage decrease was only half                    at a high level and is not showing any clear                  12 EU countries, the rate of price growth dur-
of what it had been a year before, and the                     signs of a reduction as the world economy is                  ing the last month was negative, it was pos-
                                                                                                                             itive in 10 countries and did not change in
 3 500                                                                                                                       5. For the second month in a row, consumer
                                                                                                                       4%
                                                                                                                             prices grew fastest in Romania, although the
 3 450                                                                                                                 3%
                                                                                                                             rate of their growth fell slightly and amounted
                                                                                                                       2%
 3 400
                                                                                                                             to 7.7% year on year. Prices grew more slow-
                                                                                                                       1%    ly in Greece and in Hungary, faster in Esto-
 3 350                                                                                                                 0%    nia, Bulgaria and Malta. Deflation occurred
 3 300                                                                                                                -1%    in Ireland – prices fell by 0.8%, similar to a
                                                                                                                      -2%    month earlier.
 2 250                                                                                                                           Among countries outside of the EU, a rela-
                                                                                                                      -3%
 3 200
                                                                                                                             tively high HICP indicator occurred in Iceland
                                                                                                                      -4%
                                                                                                                             and Turkey, the value was lower in Norway
          2009 2009 2009 2009 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010
           M9 M10 M11 M12 M1        M2 M3 M4       M5   M6 M7     M8   M9 M10 M11                                            and Croatia, and positive in Switzerland, al-
                                                                                                                             though close to zero. Low inflation also occurs
              average nominal wages (seasonally adjusted, left axis)
              changes in real wages, Mt/Mt (seasonally unadjusted, right axis)    Source: Central Statistical Office (GUS)
                                                                                 Source: Central Statistical Office (GUS)    in Japan. Estimates for the USA for 2010M10
                                                                                                                             indicate a HICP equal to 1.8%, and according
  Fig. 12. Wages in the enterprise sector                                                                                    to OECD data, it likely did not change materi-

                                                                                                                                             2/2011 :: Polish Market :: VII
 Economic Monitor




                                                                                                                                                                                                                                                                                                                                                                                                                    fastest were for food and beverages, energy
  7.7%




                                                                                                                                                                                                                                                                                                                                                                                                                    commodities and housing and transporta-
              5.0%
                      4.8%




                                                                                                                                                                                                                                                                                                                                                                                                                    tion. Inflation tendencies were counteracted
                                          4.0%
                                4.0%


                                                    3.4%
                                                                              3.3%




                                                                                                                                                                                                                                                                                                                                                                                                                    by the falling prices of clothing and footwear,
                                                                                         3.0%
                                                                                                    2.6%
                                                                                                               2.5%
                                                                                                                          2.5%
                                                                                                                                                         2.5%
                                                                                                                                                                  2.4%


                                                                                                                                                                                      2.2%
                                                                                                                                                                              2.2%




                                                                                                                                                                                                                                                                                                                                                                                   2.3%
                                                                                                                                                                                                                      1.9%
                                                                                                                                                                                                  1.9%




                                                                                                                                                                                                                                                                                                                                                                                                         1.9%
                                                                                                                                                                                                                                                                                                                                                                                                                    telecommunications and products and serv-




                                                                                                                                                                                                                              1.8%
                                                                                                                                                                                                                                             1.8%
                                                                                                                                                                                                                                                        1.7%




                                                                                                                                                                                                                                                                                                                          1.6%
                                                                                                                                                                                                                                                                 1.7%


                                                                                                                                                                                                                                                                                                    1.6%
                                                                                                                                                                                                                                                                                           1.7%



                                                                                                                                                                                                                                                                                                                                        1.4%
                                                                                                                                                                                                                                                                                                                                                      1.0%
                                                                                                                                                                                                                                                                                                                                                                                                                    ices related to culture and recreation. Dur-




                                                                                                                                                                                                                                                                                                                                                                         -0.8%
                                                                                                                                                                                                                                                                                                                                                                                                                    ing 2010M10-2010M11, the growth of prices
                                                                                                                                                                                                                                                                                                                                                                                                                    decreased for food, non-alcoholic beverag-
                                          Hungary
                               Bulgaria


                                                    Malta
                                                                        United Kingdom


                                                                                                   Poland
 Romania


                      Greece




                                                                                         Belgium


                                                                                                               Denmark
                                                                                                                         Lithuania
                                                                                                                                                     Luxembourg



                                                                                                                                                                                      Portugal



                                                                                                                                                                                                                              France




                                                                                                                                                                                                                                                                                                    Germany
            Estonia




                                                                                                                                                                  Finland
                                                                                                                                                                             Spain


                                                                                                                                                                                                 Czech Republic
                                                                                                                                                                                                                      Italy


                                                                                                                                                                                                                                            Austria
                                                                                                                                                                                                                                                        Cyprus
                                                                                                                                                                                                                                                                 Latvia
                                                                                                                                                                                                                                                                                           Sweden




                                                                                                                                                                                                                                                                                                                                                                                   European Union
                                                                                                                                                                                                                                                                                                                         Slovenia




                                                                                                                                                                                                                                                                                                                                                                                                        Euro area
                                                                                                                                                                                                                                                                                                                                        Netherlands
                                                                                                                                                                                                                                                                                                                                                      Slovakia
                                                                                                                                                                                                                                                                                                                                                                                                                    es and transportation. The prices of alcohol-




                                                                                                                                                                                                                                                                                                                                                                         Ireland
                                                                                                                                                                                                                                                                                                                                                                                                                    ic beverages contributed to inflation slight-
                                                                                                                                                                                                                                                                                                                                                                                                                    ly more than a month before.
                                                                                                                                                                                                                                                                                                                                                                                                                        2010M12 was the second month in a row
                                                                                                                                                                                                                                                                                                                                           Source: Eurostat                                                         of the growth in inflation expectation of pri-
                                                                                                                                                                                                                                                                                                                                                                                                                    vate individuals. The expected inflation for the
Fig. 13. Harmonised consumer prices index for 2010M11, Mt/Mt-12 in EU countries                                                                                                                                                                                                                                                                                                                                     next 12 months was 2.9%, compared to 2.6%
                                                                                                                                                                                                                                                                                                                                                                                                                    a month before. Detailed survey results from
                                                                                                                                                                                                                                                                                                                                                                                                                    the previous month showed that the percent-
  5%                                                                                                                                                                                                                                                                                                                                                                                                                age of respondents who believed that prices
  4%                                                                                                                                                                                                                                                                                                                                                                                                                will be the same as in 2010M11 fell, while the
  3%                                                                                                                                                                                                                                                                                                                                                                                                                percentage of those that believed that they
  2%                                                                                                                                                                                                                                                                                                                                                                                                                will increase at the same rate grew. The re-
  1%                                                                                                                                                                                                                                                                                                                                                                                                                maining percentages did not change consid-
                                                                                                                                                                                                                                                                                                                                                                                                                    erably. Compared to the data from 2010M8-9,
  0%
                                                                                                                                                                                                                                                                                                                                                                                                                    the percentage of respondents who indicat-
 -1%
                                                                                                                                                                                                                                                                                                                                                                                                                    ed that prices would rise faster than during
 -2%                                                                                                                                                                                                                                                                                                                                                                                                                polling time fell considerably.
 -3%                                                                                                                                                                                                                                                                                                                                                                                                                    “The BIEC Future Inflation Index, fore-
                  2009 2009 2009 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010
                  M10 M11 M12 M1       M2   M3   M4   M5   M6   M7   M8   M9 M10 M11                                                                                                                                                                                                                                                                                                                                casting price movements of consumer goods
                      inflation                                          industrial prices                                                                              construction prices                                                               Source: Central Statistical Office (GUS)
                                                                                                                                                                                                                                                        Source: Central Statistical Office (GUS)
                                                                                                                                                                                                                                                                                                                                                                                                                    and services several months in advance, rose
                                                                                                                                                                                                                                                                                                                                                                                                                    again in December 2010. Cost factors related
Fig. 14. Producer and consumer price index in Poland                                                                                                                                                                                                                                                                                                                                                                to running a business continue to put pres-
                                                                                                                                                                                                                                                                                                                                                                                                                    sure on inflation. A balanced growth in do-
                                                                                                                                                                                                                                                                                                              Recreation and culture…




     4.3
                                                                                                                                                                                                                                                                                                                                                                                                                    mestic demand, especially individual con-
                               4.3
                                                      3.8                                          3.7                                                                                                                                                                                                                                                                                                              sumption, is another factor contributing to
                                                                                                                                                                                                                                                                                                                                                        Communications




                                                                                                                            2.9                                             2.9                                                                                                                                                                                                                                     the expectation on behalf of businesses as to
                                                                                                                                                                                                   2.4
                                                                                                                                                                                                                                                                                                                                                                                                                    the possibility of raising prices.”
                                                                                                                                                                                                                                   1.7
                                                                                                                                                                                                                                                                                                                                                                                                    Clothing




                                                                                                                                                                                                                                                                                                                                                                                                                    Source: www.biec.org
                                                                                                                                                                                                                                                                 0.7
                                                                                                                                                                                                                                                                                                                                                                                                                    During 2010M9-2010M10, for the fi rst time
                                                                                                                                                                                                                                                                                                                                                                                                                    since 2010Q1, the producer price index
                                                                                                                                                                                                         Education…
                                                                                                   Transport



                                                                                                                               Hotels and restaurants…
       Housing…




                                                                                                                                                                            Health…




                                                                                                                                                                                                                                       Miscellaneous…



                                                                                                                                                                                                                                                                    Household equipment…
                                                        Alcohol and tobacco
                               Food




                                                                                                                                                                                                                                                                                                                                                                                                                    dropped in industry and construction, main-
                                                                                                                                                                                                                                                                                                        -1.1                                          -1.2                                                          ly due to a weakening demand.
                                                                                                                                                                                                                                                                                                                                                                                                                        The Producer Price Index (PPI) grew in
                                                                                                                                                                                                                                                                                                                                                                                         -3.0                       2010M10 by 3.9% year on year, compared to
                                                                                                                                                                                                                                                                                                                                                                                                                    4.3% in the previous month. Construction
                                                                                                                                                                                                                                                                                                                                                                                                                    prices grew a mere 0.1% during the same pe-
                                                                                                                                                                                                                                                        Source: Central Statistical Office (GUS)                                                                                                                    riod, compared to 0.2% for 2010M9.The short
                                                                                                                                                                                                                                                                                                                                                                                                                    (so far) interruption of the growth tenden-
Fig. 15. Change in prices of selected consumer products and services for 2010M11, Mt/Mt-12                                                                                                                                                                                                                                                                                                                          cy of the industrial PPI was caused by the
                                                                                                                                                                                                                                                                                                                                                                                                                    lower growth of prices in mining and quar-
ally in 2010M11. Prices are likely go up slight-                                                                                                                                                 2010M11 was 2.7% compared to 2.8% for a                                                                                                                                                                            rying (down from 19.7% to 17.3%), and also
ly faster in China. However, there is an ab-                                                                                                                                                     month before. Price growth was driven, for                                                                                                                                                                         in water supply, sewage and waste manage-
sence of recent estimates.                                                                                                                                                                       the second month, by food and energy pric-                                                                                                                                                                         ment (down from 5.7% to 5.5%), and manu-
    According to GUS estimates, whose meth-                                                                                                                                                      es. Core inflation, excluding those prices, was                                                                                                                                                                     facturing (down from 3.2% to 2.7%). Only for
odology is slightly different from that used                                                                                                                                                      1.2% for 2010M11. Among groups of consum-                                                                                                                                                                          the production and supply of electric ener-
by Eurostat, CPI inflation in Poland during                                                                                                                                                       er goods and services, the prices growing the                                                                                                                                                                      gy, gas, steam and water did prices grow at

VIII :: Polish Market :: 2/2011
                                                                                                                                            Economic Monitor




a slower pace (5.1% versus 4.1% a month be-         Table 2. Selected elements from the profit and loss statement of the banking industry
fore). Prices of energy-related goods grew at
a rate1.8 percentage points slower than the                            PLN billion                            2010M9                     2009M12                      2009M9
rest. Prices of non-durable consumer goods           Results of banking operations                              39.3                        49.6                        36.5
grew by 0.2 percentage points faster, and
                                                     – from interest                                            22.6                        26.3                        19.2
those of durable consumer goods fell by 1.3
percentage points faster. In the case of prices      – from fees and provisions                                   2.6                         3.7                         2.7
in the construction industry, the changes ob-        Operating costs                                            18.7                        24.8                        18.3
served during 2010M9-2010M10 were negli-
                                                     Amortisation                                                 2.0                         2.5                         1.8
gible. The prices of production mainly related
                                                     Provision for loss of value                                  8.6                       12.2                          8.2
to civil engineering continued to rise (up by
0.6%year on year), while the prices of prod-         Net income                                                   8.6                         8.2                         6.8
ucts related to the construction of buildings       Source: Polish Financial Supervision Authority (KNF); Information on the situation of national commercial banks, cooperative banks
                                                    and branches of credit institutions.
fell (down by 0.3%).

                                                    businesses was PLN 156.5 billion, hence PLN                          amount for deposits of the PLN equivalent of
Banks’ balance-sheet and monetary policy            4.5 billion less than in 2009M9. Household                           EUR 100,000 and payment within 20 work-
                                                    loans grew by 13.1% compared to 2009M9,                              ing days. “Deposits in both PLN and foreign
The end of 2010 did not bring any considera-        reaching PLN 277.1 billion in 2010M9. At the                         currencies are covered regardless of the cur-
ble change in the banking sector. In 2010M12,       same time, the value of home loans grew by                           rency, while the payout of guaranteed funds
the decision of the Monetary Policy Coun-           30% (data do not take into account changes                           takes place in PLN. In the case of co-own-
cil (RPP) was to keep interest rates at an un-      in currency values).                                                 ership of accounts, each of the co-owners
changed level.                                          Total assets of the banking sector in                            is entitled to a separate guaranteed amount.
     The NBP’s basic interest rates, on an annu-    2010M9 amounted to PLN 1142.3 billion, com-                          Guaranteed funds can be collected for up to
al basis, are as follows: reference rate: 3.50%,    pared to PLN 1045.8 billion in 2009M9. During                        5 years following bank insolvency.”
lombard rate: 5.00%, deposit rate: 2.00%, re-       2009M9-2010M9, there was a growth in em-                             Source: www.bfg.pl
discount rate: 3.75% and bill discount rate:        ployment in the banking sector and a growth
4.00%. “In the Council’s opinion, the still         in the number of sales locations from 14,614 to                      Changes to deposit guarantee rules were in-
limited inflation and wage pressure in the           14,693. Banking net income improved as well.                         troduced in all EU Member States, accord-
Polish economy, uncertainty as to the scale             The Polish Financial Supervision Author-                         ing to Directive 2009/14/EC of March 2009.
of GDP growth acceleration in Poland and            ity passed a KNF Resolution no. 314/2009 of
the economic upturn in the rest of the world,       October 14, 2009 on other banking assets be-
justify keeping the NBP interest rates un-          ing considered as core capital, their limits,                        On the Warsaw Stock Exchange
changed.” In the near future, RPP’s actions         the scope and conditions of counting them as
will be to a great extent determined by ef-         core capital. Th is means that “from Decem-                          Similar to Wall Street, the end of 2010 on the
forts to enter the ERMII zone and the euro-         ber 31, 2010, banks will not be able to include                      Warsaw Stock Exchange passed without ma-
zone. Th is in turn will influence the efforts to     new issues of convertible bonds and long term                        jor changes.
meet the Maastricht criteria (Source: Press         bonds as part of core capital (the period is be-                         The Purchasing Managers Index (PMI)
release following RPP meeting held on 21-           ing shortened when the banks could increase                          for the Polish industrial sector reached 56.3
22 December 2010, www.nbp.pl). The inter-           their core capital in a way described in Reso-                       points in 2010M12, whereas in the preced-
bank rate (WIBORM3) at the end of 2010M12           lution no. 314/2009. Funds from issuing long                         ing month it was 55.9 points. Th is means an
was 3.95%, i.e. 0.6 percentage points higher        term bonds, meeting the criteria described                           improvement in the conditions of running
than at the end of 2010M11. In 2010M11, the         in Resolution no. 314/2009 and included in                           a business in Poland. At the same time, this
monetary base contracted, however there was         core capital as of December 31, 2010 based                           was the highest value of the indicator since
an increase in the money supply multiplier.         on a decision of the Polish Financial Super-                         May 2004 and better than the analysts’ ex-
M3 money supply grew by 9.1% year on year           vision Authority, will have to meet the con-                         pectations. Th is could transpire into growth
compared to 6.3% in 2010M10.                        ditions in terms of the maximum amounts                              of share prices on the WIG index in the near
     “Business lending activity is still limited,   counted as core capital (pursuant to Arti-                           future. “December was a successful month
mainly due to causes related to demand for          cle 154 (9) of Directive 2009/111/EC, the so-                        for European markets, however the clos-
credit. The growth of home loans for house-         called grandfathering).                                              er to the end of the month, the less ‘fuel’
holds continues, including foreign currency         Source: KNF                                                          the market had for further growth. The fi-
mortgages, accompanied by a gradual de-                                                                                  nal days of the month brought a slight ad-
cline of margins included in the interest rate.”    An amendment to the Act on the Bank Guar-                            justment in the German DAX index. How-
(Source: Press release following RPP meet-          antee Fund has come into force. The changes                          ever, the national WIG20, after a rise at the
ing held on 21-22 December 2010, www.nbp.           took effect on December 30, 2010. These in-                           beginning of December mainly due to the
pl). In 2010M9, the sum of credit granted to        clude an increased limit on the guaranteed                           shares of KGHM, consolidated itself for the

                                                                                                                                                 2/2011 :: Polish Market :: IX
 Economic Monitor




remainder of the month around the level of        Table 3. Price, WIG and sector indices on the Warsaw Stock Exchange (year end)
2760 points.”
Source: www.parkiet.com                                               Position                       2010                    2009               Change (%)

                                                   WIG 20                                          2,744.17                 2,388.72              14.9%
                                                   MWIGG 40                                        2,805.26                 2,346.14              19.6%
Balance of payments
                                                   SWIG 80                                        12,219.96               11,090.93               10.2%
The balance of the current account in 2010Q3       WIG                                            47,489.91               39,985.99               18.8%
amounted to EUR -3.6 billion. Th is value was
                                                   WIG-BANKING                                     6,921.28                 5,873.82              17.8%
shaped by a positive balance on current trans-
                                                   WIG-CONSTRUCTION                                5,400.33                 5,078.86               6.3%
fers and services, EUR 850 billion and EUR 517
billion respectively, and a negative balance on    WIG-CHEMICAL                                    5,156.38                 3,217.55              60.3%
income of EUR -3.4 billion and goods of EUR        WIG-DEVELOPERS                                  2,709.52                 2,903.24               -6.7%
-1.6 billion. NBP data indicate a decrease in
                                                   WIG-ENERGY                                      4,314.39                 3,998.60               7.9%
the balance of the current account in 2010Q3
compared to 2009Q3 by EUR 2.2 billion.             WIG-IT                                          1,221.85                 1,286.24               -5.0%

    The weighted average rate of the euro in       WIG-MEDIA                                       3,792.19                 3,014.37              25.8%
2010M12 was PLN 3.9959, while of USD: PLN          WIG-OIL&GAS                                     3,079.41                 2,437.08              26.4%
3.0197. In 2010M11 these rates were as follows:
                                                   WIG-FOOD                                        4,536.52                 3,054.39              48.5%
PLN 3.9531 for EUR and PLN 2.8913 for USD.
    During the period of 2009Q3-2010Q3,            WIG-TELECOM                                     1,271.86                 1,127.99              12.8%
the deficit in goods trade increased by EUR        Source: Warsaw Stock Exchange

761 million, while the balance on income de-
creased by EUR 741 million, which contribut-      Table 4. Select data for Poland’s balance of payments
ed substantially to the reduction of the cur-
rent account balance. In the same period,                          In millions EUR                 2009M10                  2010M9              2010M10
the balance on current transfers decreased         Current account                                        -503               -1,089               -1,155
by EUR 439 million and services by EUR 209
                                                   Balance on goods                                       -303                 -228                -702
million. The balance of the capital account,
at the end of 2010M3, turned out on a pos-         Balance on services                                    456                  226                  496
itive level of EUR 1.3 billion. The quarterly      Balance on income                                 -1,146                  -1,181               -1,215
NBP balance of payments also indicates a re-
                                                   Balance on current transfers                           490                   94                  266
lationship of -2.7% between the current and
                                                   Capital account                                        651                  297                1,392
capital account balances and GDP. “The ex-
port of goods during 2010Q3 was estimat-           Financial account                                  4,587                   3,593               1,646
ed at a level of EUR 31,214 million, and im-       Official reserve assets                           -3,086                  -1,618                -540
ports at EUR 32,798 million. In comparison        Source: NBP.pl
to 2009Q3, exports grew by EUR 5,319 mil-
lion (i.e. by 20.5%), and imports increased by    in Polish entities increased (growth of EUR                    ports grew in 2010M11, compared to the same
EUR 6,080 million (i.e. by 22.8%). The balance    195 million (6.9%) in comparison to 2009Q3).                   month in 2009, by EUR 1.9 billion (19.8%). The
on goods amounted to EUR -1,584 million           The balance on transfers with the European                     balance of the capital and fi nancial accounts
compared to EUR -823 million in 2009Q3.”          Union continued to be positive and amount-                     were positive, although the latter decreased
Source: www.nbp.pl; Balance of payments in Q3     ed to EUR 1.9 billion in 2010Q3.                               during 2010M10. The balance of payments at
of 2010                                                                                                          the end of 2010M10 was positive.
                                                  2010M10 closed with a negative current ac-
The balance on income in 2010Q3 was EUR           count balance at EUR 1.2 billion (NBP esti-
-3.4 billion. It was shaped by a negative bal-    mates). The balance on income was negative                     Financial results for non-financial
ance of investment income: EUR -4.1 billion       and amounted to EUR -1.2 billion, and the                      enterprises
and a positive balance of employee wages:         balance on goods to EUR -702 million. A pos-
EUR 713 million. Estimates of the income of       itive balance on services was at EUR 496 mil-                  The situation of non-fi nancial enterprises in
Poles working abroad amounted to EUR 980          lion, while current transfers at EUR 266 mil-                  2010M1-9 was improving according to all the
million, which is a decrease of EUR 27 mil-       lion. In comparison to 2009M10, the deficit                     basic profitability indicators compared to the
lion (2.7%) compared to the situation from the    of the current account balance deepened by                     same period in the previous year. The excep-
previous year. The balance of income from in-     EUR 652 million. Exports of goods, in com-                     tion to this are other operational activities,
vestments for 2010Q3 was EUR -3.0 billion.        parison to the same period in the previous                     which decreased by PLN 6.7 billion to PLN 3.1
The income from foreign direct investment         year, grew by EUR 1.5 billion (16.3%). Im-                     billion, a 46% decrease. The fi nancial condi-

X :: Polish Market :: 2/2011
                                                                                                                                                                                                                       Economic Monitor




Table 5.                                                                                                                                                                                                 the entire 2010 assumes a deficit growth of
                                                                                                                                                                                                         PLN 10 billion.
                                                                                                                         2007M1-9              2008M1-9          2009M1-9         2010M1-9                   During 2010M1-11, government revenue
Gross return on sales, %                                                                                                           6.4             5.7                5.1             5.5
                                                                                                                                                                                                         amounted to PLN 226.9 billion, expenses how-
Net return on sales, %                                                                                                             5.2             4.5                4.2             4.6                ever were at the level of PLN 269.5 billion.
Gross profit/loss in billion PLN                                                                                                   79.1            79.3               72.9            81.1                In 2010M11 alone, revenue grew by PLN 22.6
Net profit/loss in billion PLN                                                                                                     64.5            63.6               60.0            67.5                billion, however, expenses by PLN 23.2 bil-
Share of profitable (net profit) enterprises, %                                                                                     77.8            73.5               72.5            72.6                lion. The execution of planned revenues for
Source: CSO                                                                                                                                                                                              2010 increased from 82.1% to 91.1%, while
                                                                                                                                                                                                         in the case of expenses, it grew from 81.7%
                                                                                                                                                                                                         to 89.5%. Comparing to the same period of
 13.1
                                                                                                                                         during that time was 72.6%, the remaining                       the preceding year, the execution of budg-
                                                                                                                                         showed a loss. An improvement of their ba-                      eted revenues in 2010M1-11 was lower by 0.8
           10.0 9.9
                                                                                                                                         sic economic/fi nancial indicators also took                     percentage points, and expenses by 2.3 per-
                                                                                                                                         place, such as their return on sales of prod-                   centage points.
                                   6.7                                                                                                   ucts, goods and materials (5.3% compared                            During 2010M1-11, growth in government
                                                 4.7                                                                                     to 5.1% in 2010M1-6), gross return on sales                     revenue and expenses slowed in compari-
                                                                  4.0                     3.9
                                                                                                          2.9                            – growth by 0.3% compared to 2010M1-6. In                       son to that calculated for the period 2010M1-
                                                                                                                         1.9
                                                                                                                                         2010M1-9, 47% of enterprises were selling for                   10/2009M1-10. However, the rate of budg-
                                                                                                                                         export, hence 1.9% less than in the same pe-                    et deficit growth increased from 73.9% to
                                                                                                                                         riod of 2009. The share of export sales in total                74.2%. Taking into consideration the data
                                                                                           construction
            information
  mining




                          energy




                                                                  real estate services




                                                                                                           transport

                                                                                                                             retail
                                   restaurants

                                                  manufacturing




                                                                                                                                         net sales grew in this period, however, from                    for 2010M1-11, tax revenues declined slight-
                                                                                                                                         18.4% to 20.4%. Th is could have been caused                    ly faster year on year than during 2010M1-
                                                                                                                                         by an improving economic situation of Po-                       10, while non-tax revenues grew much more
                                                                                                                                         land’s main trade partners. A large majority                    slowly. Among tax revenues, the ones show-
                                                                                                                                         of economic/fi nancial indicators achieved by                    ing higher growth were those from indirect
                           Source: Central Statistical Office (GUS)                                                                      exporters was better than in the entire group                   taxes, while the ones showing the slowest
                                                                                                                                         of surveyed enterprises, with the exception                     decline were those from income taxes. In the
Fig. 16. Net profitability in the main sectors of the                                                                                     of I and II degree liquidity indicators.                        case of expenses, those related to servicing
economy, 2010M1-9, %                                                                                                                     Source: Information on the socio-economic                       the domestic state treasury debt grew slow-
                                                                                                                                         condition of the country; GUS, October 2010                     er, while those related to servicing the for-
                                                                                                                                                                                                         eign state treasury debt grew slightly faster. In
                                                                                                                                                                                                         opposition to the data from 2010M1-10, dur-
                                                                                                                                         National budget                                                 ing 2010M1-11,the expenses related to the EU
                                                                                                                                                                                                         budget based on own revenue grew.
                                                                                                                                         In 2010M1-11, the budget deficit was PLN -42.5
      4.7                 5.0                    3.3                                     4.1                           4.6               billion and grew in comparison to 2010M1-                       Public debt amounted to 746.1 billion PLN
                                                                                                                                         10 by PLN 704.7 million. The budget plan for                    at the end of 2010M9, compared to 721.2 bil-
   2006                   2007                   2008                                    2009             2010 M1-9

                           Source: Central Statistical Office (GUS)

Fig. 17. Net return on sales index for non-financial
enterprises, %


tion of the enterprise sector was better than
that from a year ago, as well as from the fi rst
half of 2010.
    In 2010M1-9, a 4% growth in the income
of the total sector, in comparison to a 3.6%
growth in costs related to generating income,                                                                                                         269.5 226.9                            246.2 204.4                        301.2 249.0
which caused an improvement in the cost in-
dex. Gross profit amounted to PLN 81.1 billion,                                                                                                           Execution                            Execution                        Revised budget
while it was PLN 72.9 billion during the same                                                                                                            I-XI 2010                            I-XI 2010                           for 2010
period a year before. Net profit grew by 4.2%,                                                                                                            expenses                           revenues                         Source: Ministry of Finance
with a value of PLN 67.5 billion in 2010M1-
9. The share of enterprises with a net profit                                                                                             Fig. 18. National budget revenue and expenses, in billion PLN


                                                                                                                                                                                                                           2/2011 :: Polish Market :: XI
  Economic Monitor




Table 6. Estimates on national budget execution                                                                   The Monetary Policy Council kept the inter-
                                                                                                                  est rates at an unchanged level. The biggest
                              Budget Law                  Billion PLN                    Execution (%)            problem for the Polish economy in the com-
                                2010                                                                              ing period will be the state of the national
                                                2010M1-10         2010M1-11       2010M1-10       2010M1-11
                                                                                                                  budget, which will determine fi scal policy.
Revenue                          249.0            204.4                 226.9       82.1%            91.1%        The monetary policy will be pointed in the
Expenditure                      301.2            246.2                 269.5       81.7%            89.5%        direction of entering the euro-zone, which
                                                                                                                  will entail meeting the convergence criteria.
Deficit (–) / Surplus (+)         -52.2            -41.8                 -42.5       80.1%            81.4%
Source: Ministry of Finance, December 15 2010

                                                                                                                  Symbols
lion PLN at the end of 2010M6. At the end of                   pared to 15.8% during 2010M9. According to
2010M9, it was 13.1% higher than a year ear-                   the repayment dates on the obligations, medi-      If information is presented in a seasonally
lier, which indicates a slowdown in the rate                   um term debt is growing the fastest. Although      adjusted or cumulative terms, it is noted so
of public debt growth from 13.5% at the end                    comparing to the situation from a year earli-      in the text, otherwise the data is not season-
of 2010M6.                                                     er, foreign state treasure debt is still higher,   ally adjusted and in non-cumulative terms.
    A lower growth rate of public debt results                 the debt due to treasury bonds has been de-        2010M10 – October 2010
from a slower increase in the debt of the na-                  creasing for two months.                           2010Q3 – third quarter of 2010
tional government sub-sector, the one that                                                                        2010H1 – fi rst half of 2010
has the greatest share of public debt. It grew                 One of the more important goals of fiscal pol-      2010M1-10 – cumulative data for the period
by 11.6% year on year, compared to 12.1% at                    icy will remain the reduction of the budg-         of January – October 2010
the end of 2010M6. The debt of the region-                     et deficit and stopping the growth of public        2010Q1-3 – cumulative data for the peri-
al government sub-sector increased at the                      debt, which will entail a higher level of dis-     od from the fi rst to the third quarter of 2010
same rate as in 2010M6–39.3%. Having a very                    cipline in public fi nances, and particularly,      Mt/Mt-12 – rate of change calculated for a
small share in the budget, the debt of the so-                 the reduction of budget spending.                  given month in relation to the same month
cial insurance sub-sector grew at the end of                                                                      a year earlier
2010M9 by 41.6%, compared to 30.4% three                                                                          Mt/Mt-1 – rate of change calculated for a giv-
months before.                                                 Summary                                            en month in relation to a previous month
    For several months, the rate of growth in                                                                     Qt/Qt-4 – rate of change calculated for a giv-
the domestic state treasury debt has been in-                  The Polish economy is developing success-          en quarter in relation to the same quarter a
creasing. During 2010M10, it was 515.3 billion                 fully, as indicated by the fast GDP growth         year earlier
PLN and was 11.1% higher than a year before                    during 2010Q3, the positive growth rate in         Qt/Qt-1 – rate of change calculated for a giv-
(at the end of 2010M9 by 10.3%). Short term                    industry, construction and trade, as well as       en quarter in relation to the previous quarter
debt is falling in favour of medium and long                   an improving situation on the job market. In
term debt. The debt owed to foreign inves-                     2011, a rebound in the world economy may           Team of experts:
tors is also particularly on the rise (growth                  slowdown somewhat, which will likely re-           Robert Pater,
of 61.2% year on year). The growth in foreign                  sult in a slight slowdown in the growth rate       Łukasz Cywiński,
state treasury debt is slowing down, although                  of the Polish economy. In 2010M11, inflation        Tomasz Soliński, PhD
this debt is still growing. In 2010M10, it was                 was at a similar rate as in the month before,      Institute of Economics, University of Informa-
194.3 billion PLN and grew by 12.9% compared                   although there was a clear growth in the in-       tion Technology and Management in Rzeszów
to the situation from the previous year, com-                  fl ation expectations of private individuals.       www.ig.wsiz.pl




XII :: Polish Market :: 2/2011
  Wody Mineralne Ostromecko
    ul. Zdrojowa 3, Ostromecko
   86-070 Dąbrowa Chełmińska
        Tel. +48 52 381 78 00
        Fax +48 52 381 79 89
       www.wodymineralne.pl
  ostromecko@wodymineralne.pl

 Oddz. Warszawa, ul. Żurawia 32/34
     Tel./fax +48 22 622 06 98
       Kom. +48 662 185 210




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