VOLUME 17, NUMBER 48 • DECEMBER 5-11, 2011 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

RReedd ccaarrddThe Polish Football Association’s

secretary-general was fired following

corruption allegations, but president

Grzegorz Lato remains 3

Since 1994 . Poland’s only business weekly in English

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W.W

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The war is over, and Polish

companies want a piece of

the North African nation’s

lucrative oil industry12-13

FFiissccaall uunniioonn??Europe may take fundamental steps

towards creating a fiscal union this week.

Will these reflect changes proposed by

Poland? 2, 3, 10, 11

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Poland’s public sector is

less corrupt, but still has

work to do

ArcelorMittal may cut

nearly 1,000 jobs in

Poland

The Polish ‘national brand’

is getting stronger in the

region and globally

News . . . . . . . . . . . . . . . . . . . . . . .2-4

Business . . . . . . . . . . . . . . . . . . . 5-7

Finance & Economics . . . . . . . . . . .8

Opinion & Analysis . . . . . . . . .10-11

Cover Story . . . . . . . . . . . . . . .12-13

Company Focus . . . . . . . . . . . . . . .14

Lokale Immobilia . . . . . . . . . .15-18

Markets . . . . . . . . . . . . . . . . . . . . .20

The List . . . . . . . . . . . . . . . . . . . . . .21

Lifestyle . . . . . . . . . . . . . . . . . . . . .22

Last Word . . . . . . . . . . . . . . . . . . . .23

REAL ESTATELokale Immobilia

• Neptun in Gdaƒsk

• Mercure to close

• Obsolete offices

15-18

Russia’snuclear designs

Russian Rosatom

wants in on the

contract to build

Poland’s first nuclear

power plant 7

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In this issue

Libya’s riches

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Spain

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Slova

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EU27

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*Lowest in EU27**Highest in EU27

DECEMBER 5-11, 2011NNEEWWSS2 www.wbj.pl

A2 reaches

Germany

After a new section of the

A2 highway reaching the

German border opened

last week, only 92 km

remains to be built before

Warsaw is linked to the

roadway. The remaining

section is expected to be

ready in June for the 2012

European soccer

championships and will

decrease travel times

between Berlin and

Poznaƒ significantly.

Poland seeks

Tymoshenko

solutionPolish President

Bronis∏aw Komorowski

visited Ukraine last week,

where he asked for a

“realistic” solution to the

imprisonment of former

Ukrainian Prime Minister

Yulia Tymoshenko, who

was sentenced to seven

years in prison in October

for abuse of power. Her

trial and imprisonment

are putting in jeopardy

the signing of a Ukraine-

EU free trade area deal

and an association

agreement, a key priority

of the Polish presidency

of the EU Council, which

ends in December.

Death

sentence for

Minsk bombing

culprits

A Belarusian court has

sentenced two men to

death for carrying out a

bomb attack in the Minsk

subway in April that

killed 15 people and

injured around 200

others. Dmitry Konovalov

and Vladislav Kovalyov,

both 25, were arrested

three days after the

attack. Belarus is the

only European country

that still carries out

executions.

Emergency

landing

investigatedThe emergency landing

of a Lot Polish Airlines

Boeing 767 at Warsaw’s

Chopin Airport on

November 1 may have

been caused by a circuit

breaker being in the “off”

position, a preliminary

report published by the

State Commission on

Aircraft Accident

Investigation revealed

last week. However, the

report did not officially

determine the cause of

the emergency landing,

which saw 231 people

escape uninjured. ●

Aedas..........................................15

Allegro Group ............................16

ArcelorMittal ................................7

Areva ............................................7

Banco Comercial Portugues ......5

Bank Handlowy ..........................20

Bank Millennium ........................5

Bank Pekao................................20

BNP Paribas ................................5

BP ..............................................13

BRE Bank ..................................20

Budimex ....................................15

Budner........................................16

Bulanda, Mucha Architekci ......16

Citigroup ......................................8

Cushman & Wakefield ..............16

Dragados....................................12

Echo Investment ........................16

Eiffage Budownictwo Mitex ......18

ENI..............................................13

First Byte......................................6

GE Hitachi ....................................7

Graf ............................................15

Grupa Lotos ..............................12

Helaba ........................................15

Hines ..........................................15

Hitachi ........................................12

Immofinanz Group ....................15

Intesa Sanpaolo ..........................5

Investors TFI ..............................16

Jabiva DOO ..................................6

Jones Lang LaSalle ..................17

KBC Group ..................................5

KPBP Budus ..............................15

KPM Agata ................................15

Kredyt Bank ................................5

Kristensen Group ......................15

Kury∏owicz & Associates

Architecture Studio ....................16

LHI ..............................................16

Louvre Hotels ............................18

Makrum......................................16

Manta..........................................14

Millennium Bank........................16

Milwaukee Golf Caddy ..............23

Mostostal Warszawa..................12

Multikino ....................................16

Narev Inwestycje........................16

National Oil Corporation ....12, 13

OMV ............................................13

Orbis Group ................................16

pbb Deutsche Pfandbriefbank ..15

Pekao............................................5

peter nielsen & partners ............7

PGB ............................................12

PGE ..............................................7

PGNiG ........................................12

PKN Orlen ............................12, 13

PKO BP ........................................5

Pol-Aqua ....................................12

Polimex-Mostostal ....................12

Polish Oil and Gas Company ....12

Praktiker ....................................16

Project Syndicate ......................11

Projektor Architekci ..................15

PZU ..............................................5

Rafako ........................................12

Repsol YPF ................................13

Rosatom ......................................7

S+B Gruppe ................................16

Samsung ....................................16

Santander ....................................5

Starwood Capital Group ............18

STRATFOR ..................................10

Tesco ..........................................16

Toshiba ........................................7

Total ............................................13

TVN ..............................................8

UBS ............................................17

Union Investment ......................16

Vienna Stock Exchange ............18

vsf-creative ................................15

Warimpex ..................................18

Warsaw Stock Exchange ......8, 18

Westinghouse ..............................7

Wintershall Holding ..................13

X-Trade Brokers ....................8, 20

Zdrojowa Invest ..........................15

Foreign Minister Rados∏awSikorski caused a politicaluproar in Poland last week fol-lowing a speech he made inBerlin in which he proposed thecreation of a European federa-tion whose members’ nationalsovereignty would be limited inorder to allow the powers ofexisting EU institutions to beenhanced.

Mr Sikorski suggested thatthis would be the only way toensure Europe could adequate-ly deal with the difficult chal-lenges it faces.

His proposals includeincreasing the powers of theEuropean Commission, elect-ing a number of seats in theEuropean Parliament from apan-European list of candidatesand combining the positions ofpresident of the EuropeanCouncil and European Com-mission, with the holder of thenew office possibly being elect-ed by citizens.

Mr Sikorski ended hisspeech by appealing to his hoststo save the euro zone, addingthat he “feared German powerless than German inactivity.”

The speech was well-

received by the audience, withformer German President HorstKöhler saying that, as someonewho was born in Poland, he was“happy that a Polish ministerhad made such a speech.”

The European press alsogenerally reacted positively tothe speech, as did many in thePolish media. But some opposi-tion politicians in Poland wast-ed no time in berating Mr Siko-rski, with Joachim Brudziƒski ofthe conservative Law and Jus-tice (PiS) party saying the for-eign minister “longed for theFourth Reich.”

PiS leader Jaros∏awKaczyƒski declared that MrSikorski should be put beforethe State Tribunal for breachingthe constitution. He said thatwhen Poles voted for EU acces-sion it was for the membershipof a “sovereign Poland in aninternational organization ofequal nations,” and not formembership of a federation“where one nation would dom-inate the rest.”

PiS also said it would file ano-confidence motion againstthe foreign minister, althoughgiven the composition of parlia-

ment it would likely stand littlechance of succeeding.

Prime Minister Donald Tuskand President Bronis∏aw Ko-morowski have both said theyback Mr Sikorski’s proposals,although the president notedthat “it would have been betterto precede the speech with adiscussion in Poland,” as thenthe domestic reaction wouldnot have been “so emotional.”

Towards the end of theweek, Mr Kaczyƒski decided toraise the stakes even further,saying that on December 13,the anniversary of the introduc-tion of martial law, PiS wouldorganize a march in protestagainst Mr Sikorski’s Berlincomments. “Poland is in dangerof losing its independence,”said the PiS leader.

So even though the Berlinspeech will likely be quickly for-gotten in Europe as major play-ers France and Germany focuson mapping out a new financialframework to ensure the eurozone’s continued existence, MrSikorski’s words are sure toremain a topic of debate inPoland for a while to come.

RReemmii AAddeekkooyyaa

50is the number of basis points by which the US Federal

Reserve and five other major central banks lowered

the interest rate on dollar liquidity swap lines last

week, sending markets higher worldwide.

€5.8 billion is the latest tranche of aid for Greece that euro-zone

leaders have approved. This latest installment is part

of a €110 billion package of support.

49.5 pointswas the November reading for the purchasing

managers index for the Polish manufacturing sector,

its lowest level in more than two years. Any reading

below 50 indicates a downturn in the sector.

“You may not fail to lead”Foreign Minister Rados∏aw Sikorski, addressing Germany, in his speech

“Poland and the future of the European Union” made in Berlin on

November 28, 2011

Quote of the Week

Experience Marie Sk∏odowska-CurieAs 2011 winds down, so does the international year of chem-istry, which also honored arguably the world’s greatestfemale scientist, Marie Sk∏odowska-Curie. Check out thefinal events celebrating the Polish-born, two-time winner ofthe Nobel Prize by logging on to WBJ.pl to see what Warsawhas to offer before the end of December.

On WBJ.pl

Numbers in the News

Company index

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5 WIND ENERGY FORUMEvent: The Wind Energy Forum will be dedicated to

a discussion on the methodology of a recentassessment of wind farms’ impact on birdsand bats.Location: Marriott Hotelfew2011.psew.pl

8 POLISH INVESTFORUM Event: This meeting is the third edition of the

Polish Investforum.

Location: Sheraton Hotel roadshowpolska.pl

8 JEWELRY AUCTION Event: This event is an opportunity to buy unique,

precious jewels for a loved one for the com-ing holidays.zLocation: DESA Unicum Marsza∏kowska 34-50, Warsaw desa.pl

December

DATELINE

Rados∏aw Sikorski

IN THE SPOTLIGHT

Figures in focus

A lost generation?

Seasonally adjusted youth (under 25) unemployment rate in

October 2011, selected EU27 countries (in percent)

Source: Eurostat

DECEMBER 5-11, 2011 NNEEWWSS www.wbj.pl 3

Euro 2012

Poland gets favorable

Euro 2012 drawThe host nation hasbeen drawn in GroupA along with theCzech Republic,Greece and Russia

Euro 2012 co-host Polandlanded in arguably the bestgroup it could have hopedfor at the draw for the tour-nament in Kiev last Friday.

The draw, which tookplace at Kiev’s Palace of theArts, saw Poland selected inGroup A alongside 1967 win-ners the Czech Republic,Russia and 2000 championsGreece. Poland has won 10of its previous 15 meetingswith the Greek side, and willbe hoping for more of thesame when the team faces

Greece in the tournament’sopening match in Warsaw onJune 8.

This is only Poland’s sec-ond appearance in the finalstages of a UEFA EuropeanFootball Championship(originally called the Euro-pean Nations Cup). Previ-ously, the team featured inthe 2008 championships inAustria and Switzerland.

Group B is arguably the“group of death” of the 2012tournament, with three-timewinner Germany pittedagainst 1988 champions theNetherlands and 1992 winnerDenmark. Portugal, cap-tained by Real Madrid starCristiano Ronaldo, is theother team in the group.

DDaavviidd IInngghhaamm

Corruption in soccer

Football Association secretary-generalfired following corruption allegationsThe body’s president,Grzegorz Lato,remains in hisposition despiteinvolvement in thesame scandal

The Polish Football Associa-tion (PZPN) was once againcaught up in controversy lastweek when secretary-generalZdzis∏aw Kr´cina was removedfrom his position following avote by the association’s board.

The announcement, whichwas made by former Polishinternational and currentPZPN president, GrzegorzLato, followed the release ofvideo footage which seems toshow Mr Lato and Mr Kr´cinaengaged in a conversationabout the distribution ofmoney. Grzegorz Kulikowski,a property developer and for-mer sponsor of the PZPN,who sent the tapes to Poland’snew minister of sport, JoannaMucha, said the two men werediscussing bribes relating to atender for a plot of land forthe association’s new head-quarters.

In total 14 PZPN membersvoted in favor of dismissing Mr

Kr´cina from his position,while three voted against thedecision.

Ms Mucha had earlier putpressure on PZPN when shesaid that those caught up inthe scandal should resign.

“Following such situations,which are clear and obvious toany normal person, then yes,certainly those participating inthe recordings [should hand intheir resignations]. On theother hand I expect dismissalswill take place,” Ms Muchasaid at the time.

Last Thursday, Mr Latoand other senior members ofthe board were summoned tothe Sejm, the lower house ofPoland’s parliament, to discussthe issue with Ms Mucha andthe Committee on Culture,Sport and Tourism.

Damaged reputationBut Mr Lato, an Olympic goldmedal winner and the leadingscorer at the 1974 World Cup,has refused to resign despitecalls for him to step down. Hesaid the only circumstancewhich could force his exit is ifPoland failed to get out of thegroup stage at next summer’s2012 European soccer cham-

pionship, which is being co-hosted by Poland.

Micha∏ Zachodny, a Polishjournalist and author of thesite “Polish Football Scout,”told WBJ that for now heexpects Mr Lato to remainhead of PZPN.

“His reputation, which waswon as a famous footballer inthe 1970s, is now gone, but theproblem is that there is no onein the background to replacehim, since the Polish FootballAssociation is corrupt to itscore.”

This is the latest in a long

line of scandals to rock Polishsoccer. An investigation intomatch-fixing of professionalsoccer games which began fiveyears ago is still ongoing, whilein November the PZPNreversed its decision to replacethe eagle on the nationalteam’s shirts with its own logo,following widespread criticism.

“They sacrificed Zdzis∏awKr´cina as it’s a small price topay … it’s the same situation aswith reinstating the eagle,they’re just hoping that thescandal will go away,” said MrZachodny. DDaavviidd IInngghhaamm

Euro-zone crisis

FFiissccaall uunniioonn ggaaiinniinngg mmoommeennttuummGerman ChancellorAngela Merkel haslaid out her country’splan for saving theeuro zone

In a speech to the Bundestaglast Friday, German ChancellorAngela Merkel announced thather country and other Euro-pean nations were movingtowards the creation of a “fiscalunion” which would have rigor-ous budgetary oversight to com-bat the sovereign debt crisis cur-rently raging in the euro zone.

“We are not only talkingabout a fiscal union, we arebeginning to create it,” MsMerkel said, adding that thelast few months of turmoil hadchanged what people thoughtwas possible in terms ofredesigning the architecture ofEurope’s financial structures.

“Anyone who said a fewmonths ago that we, at the endof 2011, would be making veryserious and concrete stepstoward a European stabilityunion, a European fiscal union,toward introducing budgetaryintervention in Europe wouldhave been considered crazy,”she said.

The German chancellor said

that countries outside the eurozone should also be able to jointhe fiscal union, specificallymentioning Poland in herspeech.

“Poland has clearly statedthat even though it hasn’t yetadopted the euro, it wants totake on stronger obligations. Intalks we have had, Poland hasalso stated clearly that it wantsto embark on this path to a sta-ble union,” said Ms Merkel.

Indeed, last week, PrimeMinister Donald Tusk present-ed Poland’s suggestions on howto strengthen the EuropeanUnion and the euro zone.These include amendments tothe EU Treaty, the introductionof tighter financial manage-ment, and a strengthening ofthe roles of the European Com-mission and the European Cen-tral Bank.

“Nothing will be like before

the crisis anymore,” Mr Tusksaid. The PM emphasized thatif Europe fails to find thestrength in itself to prevent thebreakdown of the euro zone,Poland’s efforts to keep itseconomy in good shape couldcome to nothing.

Franco-German agreement?At the EU summit due to beheld this week, it is expected

that Germany and France willjointly push for a new Euro-pean Union treaty that wouldimpose tough new financialrules needed to combat theeuro-zone crisis and move ittowards greater fiscal integra-tion. Some observers havebilled the summit as the lastchance to restore the credibilitynot only of the euro zone, but ofthe European Union as awhole.

A day before Ms Merkel’sspeech, French President Nico-las Sarkozy’s thinking appearedto be in sync with the Germanchancellor’s, at least when itcame to the broader picture.

“France is fighting with Ger-many for a new treaty. Morediscipline, more solidarity,more responsibility … true eco-nomic government,” said MrSarkozy, who urged membersto adopt a “Golden Rule” thatwould oblige them to balancetheir budgets.

No euro bondsBut Ms Merkel remainedopposed to the recent Frenchpush for the European CentralBank to become the eurozone’s lender of last resort. TheChancellor said in her speechthat the ECB’s role was “differ-ent to that of the American Fedor the Bank of England. Its roleis to stabilize the euro and it isdoing that.”

Ms Merkel also rejected theidea of introducing euro bondsas a way of fighting the currentcrisis.

Under current circum-stances, “joint liability for thedebt of others is unthinkable,”she said.

RReemmii AAddeekkooyyaa

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Ms Merkel opened the door for Poland to join a future fiscal union

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Grzegorz Lato stays on as head of the PZPN

Group APoland, Greece, Russia, Czech Republic

Group BNetherlands, Denmark, Germany, Portugal

Group CSpain, Italy, Republic of Ireland, Croatia

Group DUkraine, Sweden, France, England

Euro 2012 group tables

DECEMBER 5-11, 2011NNEEWWSS4 www.wbj.pl

Nevertheless, itsranking among 182countries remains thesame as it was last year

Transparency International’s2011 Corruption PerceptionsIndex (CPI) gave Poland ascore of 5.5 on a scale from 0(“highly corrupt”) to 10 (“high-ly clean”), up from 5.3 lastyear. The organization uses thescoring system to measure theextent of public-sector corrup-tion in a given country.

However, despite improv-ing its score, its rank among182 countries remained thesame as last year’s, at 41st. Thatput Poland on equal footingwith Cape Verde.

In the regional section judg-ing 30 EU and Western Euro-pean countries, Poland ranked21st, above the likes of Lithua-nia (50), Hungary (54), theCzech Republic (57), Italy (69)and Greece (89). Russia, whichwas included in the EasternEurope and Central Asia sec-tion, was ranked in 123rd place,alongside countries includingNigeria and Belarus, with a rat-ing of 2.4.

New Zealand was deemed

the least-corrupt country in theworld, with a score of 9.5,closely followed by Denmarkand Finland, which bothscored 9.4.

North Korea and Somaliacame in joint-last place in theranking with scores of 1, justahead of Afghanistan in 180th

place, with a score of 1.5.Huguette Labelle, chair-

man of the board at Trans-parency International, said in astatement, “This year we haveseen corruption on protestors’

banners be they rich or poor.Whether in a Europe hit bydebt crisis or an Arab worldstarting a new political era,leaders must heed thedemands for better govern-ment.”

Transparency Internationalmanaging director Cobus deSwardt added, “High-scoringcountries show that over timeefforts to improve transparen-cy can, if sustained, be success-ful and benefit their people.”

DDaavviidd IInngghhaamm

Corruption

PPoollaanndd iimmpprroovveessccoorrrruuppttiioonn ssccoorree

The government islaunching a probe intocomments on an “anti-fascist” website thatdescribe attacksagainst nationalists

An investigation is to belaunched into messages postedin a closed forum on the Polishwebsite of the anti-fascist groupAntifa which describe violentattacks on people deemed to beright-wing nationalists, IrenaLipowicz, Poland’s HumanRights ombudsman, said in astatement.

An investigative reporterfrom Polish daily Rzeczpospolitagained access to the closed“Antifa Skins” forum on whichAntifa Poland activists allegedlyprepare and discuss attacks. Thejournalist’s findings include mes-sages recounting violent attackscarried out by forum users.

“Threw a few punches, acouple of kicks, and the Naziwas down,” is one example ofan entry posted on the forum.

The forum also containednumerous entries detailingattacks on people who, becauseof their short hair and military-style dress, were considered to

be nationalists.One forum-user wrote that

he had joined an attack onthree men because “theylooked like nationalists.”

These entries were postedafter the violent IndependenceDay clashes in Warsaw onNovember 11, which sawextreme left- and right-wingsupporters fighting with police.The incidents led to 210 arrests.

“The first step is to take thisissue to the attorney general tocarry out the investigation,” aspokesperson for Ms Lipowicz’soffice told WBJ.

The authors of the forumposts could, through their

actions, have violated article255 of the penal code, whichforbids public encouragementor praise for crimes.

Since the IndependenceDay clashes occurred, informa-tion has emerged that showsAttorney General AndrzejSeremet had already com-menced an investigation intoAntifa prior to November 11.

The investigation waslaunched following the discov-ery of a message published onAntifa’s website which includedinstructions on how to attackpolice and opposing demon-strators.

IIzzaabbeellaa DDeeppcczzyykk

Independence Day clashes

Alleged left-wing violenceto be investigated

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The police made 210 arrests on Independence Day

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The clean and the corrupt

Selected countries’ CPI scores

(10 = highly clean, 0 = highly corrupt)

Source: Transparency International, Corruption Perceptions Index 2011

DECEMBER 5-11, 2011 BBUUSSIINNEESSSS www.wbj.pl 5

The euro-zone crisishas discouragedpotential buyers frommaking the z∏.3 billionpurchaseNo binding offers were submit-ted by the late November dead-line for the purchase of a 65.51percent stake in Polish BankMillennium owned by BancoComercial Portugues (BCP),Polish media reported lastweek, citing unnamed sourcesclose to the transaction.

Polish lenders PKO BP andPekao, French BNP Paribasand Italian Intesa Sanpaolo all

reportedly filed preliminarybids in September, with BCPthen shortlisting three of thecompanies.

The sources reportedly saidthe shortlisted companies arepresently too focused on theirown capital positions to buyBank Millennium, because ofthe crisis in the euro zone.BCP’s share in the Polishlender is valued at around z∏.2.9billion. The company declinedto comment on the reports.

Under pressure to improveits solvency ratios, BCP said itwants to conclude the deal bythe end of the year.

Belgian KBC Group, alsokeen to raise capital to meetrequirements in its home mar-ket, is attempting to sell its 80percent stake in Polish unitKredyt Bank. Spanish lenderSantander recently submitted alower-than-expected offer forthe stake.

Troubles in the euro zonehave forced several banksthere to put their non-coreassets – including those inPoland – up for sale. This haslead analysts and commenta-tors in the Polish press to sug-gest PKO and insurer PZU arein a prime position to team upto buy Polish financial assetsbeing offloaded by distressedWestern owners. Prominentpublic figures also came out insupport of the idea, includingformer Prime Minister JanKrzysztof Bielecki.

Mr Bielecki has now back-tracked on that idea, however,telling a recent forum, “Now Ithink that such an ideologicalapproach is strange to me. …Maybe the opportunity willcome back when the situationof the euro zone worsens … butthen it will not so much be busi-ness, as a rescue mission.”

GGaarreetthh PPrriiccee

Banking

No buyers for Bank Millennium

Poland may soon havewhat it takes to beatout countries likeBelgium, Austria andThe Netherlands

Poland is the most valuablenation-brand out of all the ex-communist Eastern Europeancountries and the 10th-mostvaluable in the EU, accordingto a 2011 survey prepared byBrand Finance, an internation-al consultancy firm.

Poland, which came in 24th

in the ranking of the top 100nation-brands, outperformedEuropean nations includingFinland (27th), Norway (30th)and the Czech Republic (45th).Last year, Poland came in 25th

place overall.The ranking is based on an

aggregate of a nation’s score inthe fields of infrastructure, effi-ciency, economic performance,ability to attract foreign talent,perceptions on quality of lifeand projected future GDPgrowth.

While euro-zone members’brand value on the whole fell bysix percent, Eastern Europe’sbrand value grew by 9.7 percent,with Poland’s increasing by animpressive 17.1 percent. In theregion, only Hungary saw thevalue of its national brand slide.

“Poland has made hugeprogress in our ranking. Ifthings continue going for thecountry the way they are, then Ithink Poland could start outper-forming countries like Belgium,Austria or Holland,” said JohnAshbourne, an analyst at BrandFinance.

The whole Eastern Europeregion saw its brand value risefrom last year, largely as a resultof the strong performance ofmany of its economies duringthe crisis. “As a whole, EasternEurope’s growth was fasterthan that of any region in theworld, including East Asia,” theresearchers wrote in theirreport.

But how important forinvestors is their general per-

ception of a country?“It has a huge impact, if an

investor hears about an invest-ment opportunity in Poland, hisfirst reaction will reflect what hethinks about the country in gen-eral, whether in his belief it’s agood place to do business in,”said Mr Ashbourne.

“If people hear about aproduct from Germany orSwitzerland, they will automati-cally assume it to be of goodquality because the general per-ception of those countries isthat they produce high-qualityproducts,” he added.

The US is considered themost valuable nation-brand,followed by Germany, China,Japan and the UK.

RReemmii AAddeekkooyyaa

Nation-brands

Brand ‘Poland’ ranked mostvaluable in Eastern Europe

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Poland came 24th in a ranking of 100 top nation-brands

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Millennium Bank is valued at z∏.2.9 billion

DECEMBER 5-11, 2011BBUUSSIINNEESSSS6 www.wbj.pl

AA ssoolluuttiioonn ffoorr aa mmoorree eeffffiicciieenntt bbuussiinneessss??Polish IT company First Bytehas developed a software toolthat it says will go a long waytowards eliminating time-con-suming, manual data-entrytasks used in a range of busi-ness processes.

Called WizLink, FirstByte’s new tool performs spe-cific, repetitive data-entrytasks. Maciej Zagórowski,one of WizLink’s creators,told WBJ that it helps reducemistakes caused by humanerror and frees up employees

to focus on decision-makingand more creative tasks.

The software integratesapplications used for storingdata, allowing it to carry outdata-sharing between a largenumber of applications. It canalso be programed to performa range of different tasks,increasing productivity “in ameasurable way,” accordingto the company.

Customer service centerswhich process data manuallyhave to use, on average, seven

different data storage applica-tions, First Byte says.

This means employeessuch as call-center workershave to enter the same infor-mation into several differentdata applications, which canbe extremely time consuming,said Kasjan Kajrunajtys,another of WizLink’s creators.

Instead of entering a cus-tomer’s name seven differenttimes in seven different appli-cations, WizLink allows a sin-gle entry to be replicated in

all the applications simultane-ously, he added.

“WizLink enables datatransfer between applicationsand automation of routinetasks, which eliminates thesenseless copying and pastingof customer data betweenapplications,” Mr Kajrunajtyssaid.

Cost-cuttingThe problem with most data-entry integration systems cur-rently in use is that they

require all data-entry applica-tions used by a company to beremoved and replaced withcompatible versions.

“This is expensive andentails the training of employ-ees to operate a new applica-tion, which can take fromthree to four months,” MrKajrunajtys said.

WizLink, its creators say, isthe first program that doesnot require firms to replaceold applications with newones. Moreover, training in its

use takes just a couple ofweeks, Mr Kajrunajtys said.

The company has alreadyoffered the program for a trialperiod to a Polish bank and aPolish insurance company.

The biggest problem it hascome across so far is in per-suading businesses that theprogram actually works.

“WizLink is so proficientthat people think it is toogood to be true,” Mr Kajruna-jtys said.

IIzzaabbeellaa DDeeppcczzyykk

Investment destinations

Macedonia offers opportunities for Polish investorsThe small southeastEuropean countryranks high inbusiness-friendlinessand is pushing itsinvestmentattractiveness

Macedonia, a landlockedcountry nestled in the Balkans,has never really managed toget on Polish investors’ maps.But the country is making apush to be seen as a business-friendly destination, and Pol-ish businesses looking toexpand in Southeast Europemight be well-served to givethis EU candidate country asecond look.

Business-friendlyFor one, Macedonia’s newlyelected prime minister, NikolaGruevski, has made attractingforeign capital – in the form ofinvestment and tourism – hisnumber-one focus, LjupcoMihailovski, head of theAgency for Foreign Invest-ments and Export Promotionat the Macedonian Embassy inWarsaw, told WBJ.

He added that while thecountry’s small size – its twomillion inhabitants roughlyequal the population of War-saw – could be seen as a nega-tive, it is an important advan-tage when it comes to provid-ing a good environment forforeign investment.

One advantage of Macedo-nia’s diminutive market is thatinvestors can get access todecision makers with ease. “Ifa construction permit is notissued in two weeks’ time, theinvestor can call and speak to aminister. In Poland, that sameinvestor would have to gothrough a lot of administrationbefore figuring out what wentwrong.”

The country’s claim to busi-ness-friendliness is supportedby numbers from the WorldBank’s “Doing Business 2012”ranking. In terms of the easeof doing business, Macedoniaranked 22 out of 183economies. That’s up 12 placeson the previous year and com-pares to Poland’s ranking of62. The World Bank foundthat it takes only three days tostart a business in Macedonia.

In Poland it takes 32.Tremors in the euro zone,

especially in neighboringGreece, with which Macedoniahas close trade links despitethe ongoing name dispute (seebox), still pose a threat togrowth, in particular when itcomes to demand for Mace-donian exports. Nevertheless,the World Bank forecasts GDPwill grow by 3.5 percent thisyear and reach 4-4.5 percentover the medium term.

Trade ties Why is it then that bilateraltrade figures between Polandand Macedonia, which werealready rather modest, havebeen declining since 2008?According to Poland’s Min-istry of Economy, the econom-ic situation in the Balkans,along with the global econom-ic crisis, are to blame. Never-theless, the ministry says itsees “an increased interest ofPolish companies in establish-ing contacts with Macedonia.”

Currently, the overwhelm-ing majority of Polish exportsto Macedonia are metals (81percent), while Macedonianexports to Poland are morediversified between agri-foodproducts (50 percent), metals(18 percent), engineering andlight-industry items (26 per-cent), according to numbersfrom the Economy Ministry.

Opportunities aboundMarjana Todorova Georgie-va, CEO of Jabiva DOO, aconsultancy that helps compa-nies establish themselves inMacedonia, said now is agood time to invest in listedMacedonian firms.

“Due to the global climate,Macedonian companies at the

Macedonian Stock Exchangeare immensely undervaluedand are a quick pick for theprospecting investor,” she said.

According to Mr Mihailovs-ki, the automotive sector is ripefor more investment. Car partsare among the most exportedproducts from Macedonia to

Poland this year, and the gov-ernment provides attractiveconditions for automotive com-panies, including tax breaksand investment grants, he said.

Ms Georgieva added thatPolish investors should look toexport new business formats.“The migration from small

grocery stores to supermarketsand shopping malls developedimmensely in the last fiveyears. I would advise Polishcompanies to check whethertheir business model is alreadythere, and if not, expand toMacedonia, and then to theregion.” VVeerroonniikkaa JJooyy

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A steep plunge

Polish-Macedonian trade turnover from 2008 to Q3 2011

(in € millions)

Source: Polish Ministry of Economy

What’s in a name?

Much like Shakespeare’sJuliet and her rose, thoseunfamiliar with the long-standing dispute betweenGreece and Macedonia overthe latter’s official name maywonder what’s in a name.

Greek opposition to theformer Yugoslav state’s nameof Macedonia, which coin-cides with the historicalGreek region of Macedonia,has been since the breakup ofYugoslavia in 1991, and re-

mains one of the major obsta-cles to Macedonia becomingan EU member.

Poland, like many coun-tries, uses the constitutionalname Republic of Macedo-nia in their bilateral rela-tions, while the EU and mostinternational organizationsrefer to the country as theformer Yugoslav Republic ofMacedonia (FYROM).

A possible breakthroughcould take place on December

5, when the Hague-based Inter-national Court of Justice isexpected to deliver its judgmentin Skopje’s case against Athensfor blocking Macedonia’s acces-sion to NATO in 2008.

But observers remainskeptical. With the nationalis-tic opposition having gainedmore influence since the res-ignation of Prime MinisterGeorge Papandreou in Nov-ember, Greece shows littlesign of softening its stance. ●

DECEMBER 5-11, 2011 BBUUSSIINNEESSSS www.wbj.pl 7

Contact: Miros∏aw Stefanik

ms@pnplaw.pl

Legal News

BROUGHT TO YOU BY PETER NIELSEN & PARTNERS LAW OFFICE

Ski helmets made obligatoryFrom December 31, 2011 provisions ofthe Act on Safety and Rescue in Moun-tains and Ski Resorts will come into force.The act specifies rules regarding the enti-ties which have the right to conductmountain rescue operations, the scope oftheir duties and rights, as well as obliga-tions of persons staying in mountainousregions and in ski resorts.

Any person under 16 years of age whointends to ski downhill or to snowboard ata ski resort in Poland will now be obligedto use a protective helmet. In the past, hel-mets were obligatory in Poland, but laterthose provisions were changed. Pursuantto the act, a fine may be imposed on a per-son who is taking care of persons who, inturn, fail to use helmets. The same willapply to persons who practice wintersports while intoxicated with alcohol orillegal substances.

Retirement age to be increasedPrime Minister Donald Tusk announcedduring a recent speech on proposals forthis parliamentary term that his govern-ment plans to raise the retirement age in

Poland. Pursuant to the planned changes,the retirement age will eventually beincreased to 67 years of age for both menand women. However, women will retireat the age of 67 from 2040 whereas formen it will be from the considerably soon-er date of 2020. Retirement age increaseswill be implemented gradually. Draft legis-lation with respect to the plannedchanges is expected soon.

Taxpayers may apply forrefund on delayed interestThe Constitutional Tribunal has ques-tioned some provisions of the Act on Fis-cal Control with its judgment of October18, 2011 (court ref. no. SK 2/10). The gen-eral rule of the Polish law on tax protectstaxpayers against excessive interestcharges for a delay in tax settlements. Ifan authority conducts prolonged proceed-ings, no interest for the delay for that peri-od should be charged. For many years thisrule did not apply to control proceedingsconducted under the Act on Fiscal Con-trol. The taxpayers who in the periodbetween 2003 and 2010 paid undulycharged interest on tax delays will be ableto apply for the refund. ●

Steel industry

ArcelorMittal may lay offthousands of workers

The steel producer hasreportedly saidaround 1,000 jobs willgo. Unions say manymore are on the line

Steel giant ArcelorMittalcould lay-off nearly 1,000employees at a furnace in thecity of Dàbrowa Górnicza, inSilesia voivodship, at thebeginning of next year, thecompany has been reported assaying. Local media wrote thatArcelorMittal Poland’s man-agement board sent a letter tothe labor office in DàbrowaGórnicza saying it will carryout collective redundancies

involving about 980 people. The company is planning to

shut down the blast furnace“to adapt capacity utilizationto demand levels,” it said in astatement. ArcelorMittal saysit will re-open the furnace assoon as market conditionsallow it to. It has not publiclyannounced the number of jobcuts that will result from theclosure, which is expected totake place early next year.

A meeting to discuss the sit-uation in the local steel industrywas organized last week by theSilesia Voivodship Commissionfor Social Dialog (WKDS).Representatives from Arce-lorMittal Poland and the com-

pany’s unions took part. Union members said clos-

ing the furnace could actuallyresult in 3,000 people losingtheir jobs by the end of 2012.

They are worried this willhave a “negative effect on theemployment structure in theregion, and will drive a further5,000 layoffs in positions relat-ed to steel production,” theSilesian Voivodeship Office,which conducted the meeting,wrote in a statement. Thiscould result in structuralunemployment in DàbrowskieZag∏´bie, the region in whichDàbrowa Górnicza is located,the unions said.

Andrzej Wypych, a mem-ber of the board atArcelorMittal Poland, said atthe meeting that he would notcomment on the number oflayoffs until appropriate eco-nomic analyses had been com-pleted.

However, Mr Wypych saidthe company plans to presentsix motions to the minister ofeconomy, the implementationof which would improve theeconomic conditions of thesteel industry. The motionsconcern Poland’s fiscal policy,carbon dioxide limits, exciseon electrical energy andchanges to the employmentcode.

IIzzaabbeellaa DDeeppcczzyykk

Nuclear power

Rosatom to bid fornuclear plant projectPGE is expected tolaunch a tender for theproject this month,with a deal set to beinked in 2013

Russia’s state-owned corpora-tion Rosatom will join FrenchAreva, Japanese-American GEHitachi and Westinghouse, aUS-based unit of Japan’s Toshi-ba, in bidding to providenuclear technology for thecountry’s first nuclear powerplant, a spokesperson atRosatom confirmed to WBJ.

“Discussions are currentlyongoing. Yes, Rosatom will bidalongside the others forPoland’s first nuclear powerplant,” the spokesperson said.

State-owned Polska GrupaEnergetyczna (PGE), chargedwith overseeing the project, isexpected to launch the tenderbefore the end of this year andmake a choice by 2013.

The news came as a surpriseto some, since one of the prior-ities of Poland’s energy securitypolicy, including its decision tobuild two 3,000-megawatt(MW) nuclear power plants by2030, is to gain independence

from Russia, which currentlyprovides most of its natural gas.

There are no restrictions asto who can bid for the tender,but it is improbable that Polandwould choose the Russian firm,said Thomas Chmal, an energyexpert at the Sobieski Institute,a Polish think tank.

“As far as I know there is noother Rosatom project in theEU, and it seems unlikely thatPoland would be the guineapig,” he said.

In 2010, Rosatom inkedagreements on the construc-tion of the first nuclear powerplants in Turkey and Vietnam.

Last month the company,which built Iran’s first atomicplant, said it might help thecountry to build more in thefuture.

The Polish project,described by PGE manage-ment board president TomaszZadroga as “one of the largestinfrastructure developmentprojects in the history of thePolish economy,” is valued atbetween €18-21 billion.

Mr Chmal said he believedthe current economic turmoilin the euro zone should notaffect Poland’s nuclear pro-gram. AAlliiccee TTrruuddeellllee

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Rosatom has built numerous power stations in Russia,

as well as one in Iran

Silesia is steeling itself for job losses

WSE investors

PPoolliisshh iinnvveessttoorrss:: yyoouunngg aanndd rreessttlleessss

Individual investors trading onthe Warsaw Stock Exchangeare young, don’t invest for thelong-term, hold few stocks andrely most frequently on theinternet as a source of invest-ment information, accordingto findings from a nationwidesurvey of investors conductedby the Association of Individ-ual Investors (SII). The studysurveyed over 7,300 investorsthroughout Poland.

On the whole, those sur-veyed were not found to belong-term investors, with 46.1percent holding Warsaw StockExchange stocks for up to oneyear and 19.4 percent for onlyone month. Meanwhile, 25.6percent said they hold on tostocks for longer than a year.Some 3.9 percent engage inday-trading, while 4.9 percenthold stocks for up to one week.

A sizable share of investorssurveyed (42.6 percent) werebetween the ages of 26 and 35,while 21.2 percent were underthe age of 25 and 20.5 percentbetween 36 and 45 years old.The rest were aged above 45or did not respond when asked

about their age.The vast majority of Polish

investors (72.5 percent) hadcompleted higher educationand 42.4 percent were report-ed as living in cities with popu-lations of 500,000 or more.

Internet generationClose to 81.9 percent of thosesurveyed said they use theinternet when looking forinformation about stocks; 69.7percent consulted newspapersand 62.7 percent watched TVprograms to get their invest-ment news. Comments fromanalysts and blogs (36.5 per-cent), discussion forums (28.7percent), company reports(27.9 percent) and companywebsites (19.4 percent) areother sources of informationfrequently drawn upon.

SII’s report found thatinvestors most often look at thefollowing financial websites:Bankier.pl (36.1 percent),Money.pl (30.9 percent), Parki-et.pl (22.7 percent), Pb.pl (17.6percent), Stooq.pl (15.8 percent),and Onet.pl (12.5 percent).

When it comes to newspa-

pers, investors rely most strong-ly on Parkiet, at 52.2 percent, butalso on Puls Biznesu (29.9 per-cent), Rzeczpospolita (19.7 per-cent), and Gazeta Wyborcza at(18.2 percent). Close to 82 per-cent of those surveyed reportedwatching TVN CNBC Biznesfor financial information.

When it comes to makingfinal investment decisions, themajority of surveyed Polishinvestors – 64.2 percent – saidthey rely on their own analysis,while 63.5 percent said theyrely on their own intuition.Some 54 percent, meanwhile,

said they rely on informationfrom companies.

The number of individualsecurities accounts on theWarsaw Stock Exchange sur-passed 1.5 million at the end ofOctober, according to figuresfrom the National Depositoryfor Securities.

On the whole, 41.6 percentof investors said they ownedshares in two or three compa-nies, 38.8 percent said four toseven companies, 11.4 percenteight or more and 8.1 percenthad stock in only one company.

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DECEMBER 5-11, 20118 www.wbj.pl FFIINNAANNCCEE && EECCOONNOOMMIICCSS

GDP

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It may be only amatter of time beforeit starts to lose steam

The Polish economy grew by4.2 percent year-on-year dur-ing the third quarter of 2011,the Central Statistical Office(GUS) announced last week.The growth was stronger thanthe market consensus forecastof 4 percent, but analystsbelieve it won’t be long beforethe crisis in the euro zonestarts to negatively impactgrowth.

“If a global economic recov-ery was taking place, this wouldbe great data, suggesting thelikely acceleration of growth insubsequent quarters,” saidPrzemys∏aw Kwiecieƒ, chiefeconomist at X-Trade Brokers.Unfortunately, the main fac-tors behind last quarter’s stronggrowth are not sustainablegiven the current situation inthe euro zone.”

For example, net exports,which contributed as much asone percentage point to GDPgrowth in Q3 2011, partly dueto a weak z∏oty, are expectedto weaken. And while a weak-er z∏oty may have helpedexports, it has already taken itstoll on consumer spending,especially for householdsholding foreign-currency debt.This, together with forecast

high fuel prices and sloweremployment growth, is expect-ed to curb Poles’ appetite forspending in coming quarters.

Lower levels of publicspending, due to the govern-ment’s ambitious fiscal con-solidation plans, are also onlybeginning to be felt. “Fiscaltightening, including a cap ongovernment spending, is tak-ing its toll. We expect this willbecome more evident in thecoming quarters as the gov-ernment is trying to reducethe general governmentdeficit to 3 percent of GDP in2012,” Citigroup Global Mar-kets analysts wrote in areport.

Analysts say third-quarterdata suggest GDP growth forfull-year 2011 could reach 4percent or slightly higher,while clearer signs of a slow-down should be visible duringthe first and second quartersof 2012.

Last week, Finance Minis-ter Jacek Rostowski said thestate budget for 2012 will like-ly assume GDP growth in 2012of 2.5 percent. The figure isthe more moderate of threeproposed by Mr Rostowski atthe beginning of November.The other two foresaw growthof 3.2 percent and a contrac-tion of 1 percent.

AAlliiccee TTrruuddeellllee

%

20

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60

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Radio

Compan

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Compan

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ts

Discussio

n forum

s

Analyst

comment

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TV pro

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Newspa

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19.219.427.9

81.9

69.762.7

36.528.7

Surfing for shares

The main sources used by Polish investors for investment information

Source: Association of Individual Investors

A survey has found that Polish investors inWSE-listed stocks are typically young, use theinternet for research and don’t make long-terminvestments

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2

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4

5

Q3 2011

Q2 2011

Q1 2011

Q4 2010

Q3 2010

Q2 2010

Q1 2010

Q4 200

9

Q3 200

9

Q2 200

9

Q1 200

9

Headed back down?

Poland's GDP growth per quarter (annualized, in percent)

Source: Central Statistical Office

DECEMBER 5-11, 201110 www.wbj.pl OOPPIINNIIOONN && AANNAALLYYSSIISS

The North Atlantic Treaty Orga-nization has led the Interna-tional Security Assistance

Force (ISAF) for eight years as of lastAugust. By the time the transition inthe war in Afghanistan is complete in2014, it will have surpassed 11 years.The official aim of NATO’s role inAfghanistan remains the eradicationof the terrorist threat arising from thecountry while contributing to a betterfuture for the Afghan people.

Broader goalsAs a NATO member state and anISAF troop-contributing nation,Poland shares the alliance’s objec-tives in Afghanistan. Furthermore,Poland has worked tirelessly towardsthis end, not least since the Polishmilitary contingent, which todaystands at about 2,500 troops, hasoperated without any nationalcaveats, in contrast to some othernational contributions. More recent-ly, Poland has made a greater contri-bution to supporting developmentactivities in the country as well.

Nonetheless, purging Afghanistanof the terrorist threat has never reallybeen the main reason for Poland’srobust contribution to the ISAF. Inter-

national terrorism has never posed adirect threat to the country, despitehaving been identified as a challengein the Polish National Security Strate-gy of 2007. Instead, the main rationalehas revolved around the strategicimportance of NATO for the country’ssecurity. By making a solid contribu-tion to ISAF, NATO’s most significantmission to date, Poland has aimed tokeep the Alliance effective and func-tional. Also, Poland wanted to demon-strate its value as a provider (and notjust a “net consumer”) of security andassumes that if it shows solidarity withits allies, they will reciprocate if andwhen it becomes necessary. Expertshave added the point that in recentyears the Polish contribution has beeninstrumentalized to obtain other polit-ical goals. One example was in the useof the Afghan deployment to rein-force Poland’s hand during negotia-tions on NATO’s New Strategic Con-cept (NSC) so that the final documentreflected Polish priorities and con-cerns.

Varying degrees of successPoland appears to have enjoyed vary-ing degrees of success in realizingthese goals. Granted, NATO is not

without challenges. Still, the allianceremains a powerful and effective polit-ical-military instrument. Moreover,the allies have come together andagreed on an ambitious agenda for thefuture, as set out in the NSC ofNovember 2010. A case could bemade that NATO remains in decentshape not because of Afghanistan, butin spite of Afghanistan. The operationhas suffered several setbacks that haveundermined NATO’s credibility in theeyes of some, as well as diluted theperception of alliance solidarity due todifferences in approach, including theissue of national caveats.

However, this argument underesti-mates the scale of the task inAfghanistan and the fact that manynational restrictions have been abol-ished in recent years as insurgent activ-ity has spread throughout the country.Further, all allies have remainedengaged in the ISAF mission in someform despite the difficulties. Eitherway, it would seem vital that Polandremains committed to ensuring an effi-cient and credible transition as well asbe politically in step with the alliesthroughout the entire process. Inshort, this means successfully manag-ing the drawdown of Polish troops in

Afghanistan by the end of 2014. Looking at the NSC, Poland’s suc-

cess is more apparent. Consistent withthe Polish stance, the document reaf-firms collective defense under ArticleV of the North Atlantic Treaty as acore task and commits the allies tostrengthen capabilities in this regard aswell as to carry out necessary training,exercises, contingency planning andinformation exchange. Moreover, theNSC recognizes the need to provide“visible assurance” for all allies, whichreflects a long-standing Polish concern.It should also be added that all existingelements of NATO’s command struc-ture in Central and Eastern Europeremain in place despite a recentlyannounced reshuffle. Finally, the NSCperceives NATO’s relationship withRussia in a way that recognizes the Pol-ish position. Russia is neither referredto as the alliance’s most importantpartner (as some allies would prefer)nor as its main adversary.

Naturally, the significance ofPoland’s ISAF contribution in ensuringa favourable document should not beoverestimated. Also, the importance ofother factors should not be overlooked,such as the similarity of the US positionto that of Poland on Article V-related

issues. Looking ahead, much will nowdepend on whether the NSC is appro-priately implemented, which willrequire Poland’s continued activeengagement within the alliance.

A work in progressIn short, Poland’s goals regardingAfghanistan go beyond the missionitself, and have been met with varyingdegrees of success to date. Given thenature of these objectives, however,much will also depend on the futurecourse of Polish policy, not only onAfghanistan but also towards NATOin general. ●

Gareth Chappell is an analyst atThe Polish Institute of International

Affairs (PISM). pism.pl

“Purging Afghanistan ofthe terrorist threat has

never really been themain reason forPoland’s robust

contribution to the ISA”

Mission accomplished for Poland in Afghanistan?Gareth Chappell

STRATFOR

German Chancellor AngelaMerkel and French PresidentNicolas Sarkozy on Thursday

invited Poland and Sweden to bepart of a voluntary EU treaty thatwould seek deeper financial integra-tion and oversight among its mem-bers, the German newspaper Bild-Zeitung reported, citing an unnamedsource. The special invitation fol-

lows the controversial speech onMonday by Polish Foreign MinisterRados∏aw Sikorski, during which MrSikorski described the possible fallof the euro zone as the biggest exis-tential threat to Poland and calledon Germany to take a more activerole to stabilize the European crisis.

“Poland is left with only onecourse of immediate action: to pushfor the maintenance of the existinginstitutional system, which in thiscase is the European Union.”

Geopolitical challengesMr Sikorski’s comments and thesubsequent reported invitation byMs Merkel and Mr Sarkozy areindicative of the complex geopoliti-cal challenges that Poland is facingas the euro zone crisis intensifies

and moves toward a potentially dev-astating climax. Should the eurozone collapse – and especiallyshould the EU project in general fail– Poland would find itself con-fronting an impossibly dire securityparadigm.

Warsaw perceives Russia’s resur-gence within Moscow’s former areaof influence as a grave existentialthreat – a threat Warsaw has contin-uously attempted to thwart byengaging in several security alliancesand commitments. A strong inde-pendent Germany traditionallyposes another existential threat toPoland; however, while Germanyhas been restrained by the institu-tional binds of the European Union,it actually has acted as one ofPoland’s best levers against Russia.The dissolution of the euro zonewould remove those binds, requiringthe implementation of alternativesecurity guarantees. Meanwhile,there are problems with other tradi-tional security pillars of the ColdWar era.

NATO, Poland’s traditional andlong-standing post-Cold War securi-ty guarantor, has been experiencinga continued loss of strategic identity.Most importantly, the political andexistential crisis that would arise inWestern Europe should the Euro-pean Union fall would make NATOan even more fractious and unreli-able ally – which in many waysPoland and other Central Europeancountries already perceive it to be.In addition, as the United Statesslowly steps back from more than adecade of conflicts in the Middle

East, its willingness to single-hand-edly take on a costly security alliancein Central Europe would also likelybe diminished by the financial fall-out of the euro zone’s dissolution.

Saving the EUPoland, and the other Central andEastern European countries thatfind themselves precariouslyexposed to Russia, have attemptedto revitalize alternative securityarrangements, including the Viseg-rad Group and the Nordic Battle-group. However, these arrange-ments require a level of political andeconomic commitment that no partyinvolved has been willing or able toput forth. The very nature of theeuro-zone crisis is that it is nearlyimpossible for any nation to put inmotion adequate preparations forthe potential failure of the currencyunion. Furthermore, it is these coun-tries that are most committed tokeeping the existing institutionalinfrastructure at nearly any cost. AsMr Sikorski’s speech points out, if itbecomes clear that some EU mem-bers are readying contingency plansfor a post-euro era, they can hardlyexpect anyone else to bet on theirsuccess. Such regional commitmentsare likely to only be mustered oncethe fall of the European Unionbecomes a reality; they are remedialrather than preventive measures.

Therefore, Poland is left withonly one course of immediateaction: to push for the maintenanceof the existing institutional system,which in this case is the EuropeanUnion. Mr Sikorski’s speech is a

landmark in that it represents thefirst time a pre-eminent Europeanpolitical figure has stated that thesurvival of the European Uniondepends on Germany taking astronger position within the organi-zation. The speech implied thatPoland was prepared to supportGermany gaining a measure offinancial and political control withinthe European Union, if it helpsavoid the dissolution of the entity.

More integrationThe integrationist core of the Euro-pean Union (Ms Merkel and MrSarkozy) has caught the hint offeredby Warsaw. France and Germanyinvited Poland and Sweden – anoth-er strategic non-euro zone EUbystander – to join a group that willlikely support the European Union’sdeeper integration. The treaty wouldbe open to any EU member statewilling to follow a shared set offinancial regulations and oversight.This offer provides Warsaw theopportunity to demonstrate its com-mitment to the survival of the Euro-pean project.

While it makes little economicsense for Poland to integrate itselffurther into the European Union –its economy has remained relativelyhealthy throughout the crisis – War-saw will have shown its willingness toendure sacrifices in order to preventthe euro-zone crisis from spiralingbeyond control. Such an intensifica-tion of the crisis, after all, would havedisastrous effects for the Polish econ-omy, in great measure reversing theeconomic gains Warsaw has made.

In an implicit sign that Germanyunderstands the conundrum facedby Warsaw, the German defenseminister Thursday invited Poland tojoin the Eurocorp – a joint EU mili-tary contingent that pledges to fieldup to 60,000 troops – by 2016. Whilethe move bears no immediate tacti-cal relevance to Polish security, itnonetheless sends a clear signal thatBerlin is willing to at least symboli-cally push forward strategic and mil-itary cooperation with Warsaw with-in the EU framework, if Poland iswilling to support Germany’sincreased influence within the eco-nomic governance of the EuropeanUnion.

Warsaw is now at a critical junc-ture. It must weigh the strategic riskit would face from Moscow and Ber-lin, should the union fall, against thepotential negative implications of astrong Germany sitting at the helmof the European Union. The resultof this difficult, yet familiar, existen-tial balancing act for Poland willdetermine the level of commitmentit is willing to put into the preserva-tion of the European Union. So far,Poland seems to have decided thateven with freer rein within the Euro-pean Union, Germany will remainconstrained enough – and this ispreferable to facing the risk of Rus-sia’s expansion at the doors of apotentially disunited post-EUEurope. ●

“Poland’s choice: A stronger Germany” is republished with

permission of STRATFORstratfor.com

Poland’s choice: A stronger Germany

“Warsaw must weighthe strategic risk itwould face fromMoscow and Berlin,should the union fall”

A Polish answer to the German Question

DECEMBER 5-11, 2011 OOPPIINNIIOONN && AANNAALLYYSSIISS www.wbj.pl 11

Constanze Stelzenmüller

It is German Question Timeonce more in Europe. OnlyGermany, the continent’s

most powerful economy, that is stillmiraculously going strong, can leadthe way to a recovery.

The problem is that the Germans,just delays before an historic EU sum-mit weighs far-reaching treatyreforms to calm the markets and –perhaps – save the euro zone, are still

debating the wrong questions. Last Monday, however, a Pole

came to Berlin and spelled out thequestion for the Germans. Or rather,he chiseled it in stone, in the starkestpossible terms. In doing so, hedemonstrated a remarkable grasp ofhis Western neighbor’s psychology.

Polish Foreign Minister Rados∏awSikorski began his speech with anastute reference to the tired clichéthat Europe has become boringbecause it is no longer about mattersof war and peace. Wrong, he said –

the Balkan Wars began in 1991 withthe disintegration of the dinar, theYugoslav currency.

Those wars, lest anyone forget,lasted 14 years and claimed up to130,000 lives. They caused Germanyto offer shelter to 300,000 refugees,and to go to war for the first time inits post-World War II history. It was areminder guaranteed to get his audi-ence’s rapt attention, and keep it.

Mr Sikorski bowed to his Germanfriends, Chancellor Angela Merkeland Foreign Minister Guido Wester-welle, by supporting their calls forautomatic sanctions, an electedEuropean president, and more Euro-pean integration. The framers of theUS constitution, he noted, had donesomething very similar when theydecided to make their historic movefrom a confederation to a real feder-ation. (It’s not every day Germanleaders get compared to James Madi-son and Thomas Jefferson.)

Even more shrewdly, the ministerreminded his listeners that a key ele-ment of the deal had been AlexanderHamilton’s brokering of a joint debtguarantee and revenue stream for the13 founding states – an elegant way ofpointing out that euro bonds, and a

stronger European Central Bank(both still officially anathema to Ber-lin), are the logical conclusion to callsfor a stronger EU.

Mr Sikorski also thanked the Ger-mans for their “solidarity” withPoland after 1989 – but not withoutadding that “I hope you appreciateit’s been a good investment.” In 2010,German exports exceeded 1990 levelsninefold.

Was there a hint of acid in his sub-sequent remark that Germany’s tradewith Poland is bigger than with theRussian Federation, “although youwould not always know it from Ger-man political discourse?” Perish thethought.

But by then it was time to dispensewith diplomatic politesse. Mr Sikors-ki had already pointed out that Ger-many has profited more than anyother country from exports to the 10new Eastern European membersafter 2004: its annual export volumerose from €15 billion to €95 billion in2010. In the last third of his speech,he bluntly enumerated six reasonswhy Germany owes its fellow EUmembers solidarity:• Germany is the biggest beneficiaryof the euro zone

• Germany is not an innocent victimof others’ profligacy, having brokenthe Growth and Stability Pact and letits banks “recklessly” buy risky bonds• Germany has profited from lowerborrowing costs• Germany stands to suffer mostfrom a breakup of the euro zone• The danger of collapse is “muchbigger” than the danger of inflation• Germany’s size and history give it aspecial responsibility to preservepeace and democracy on the conti-nent. (Here Sikorski quoted JürgenHabermas, German secular intellec-tuals’ answer to the Pope: the lasttime a German revolution failed, in1848, it took a hundred years toregain a similar level of democracy.)

At this point, the silence in theauditorium was deafening.

We were sitting only a stone’sthrow from the Brandenburg Gate,Berlin’s graceful symbol of reunifica-tion. Recent history has been verygenerous to Germany; some mayhave thought redemptive. Not a nicethought that things might go intoreverse again.

To finish, Poland’s foreign minis-ter reminded the Germans that theircountry is not an island: “The biggest

threat to the security and prosperityof Poland” … is not terrorism, notthe Taliban, not German tanks, norRussian missiles … but “the collapseof the euro zone.”

“I demand of Germany that,” MrSikorski continued, “for your sakeand for ours, you help it survive andprosper. You know full well thatnobody else can do it. I will probablybe the first Polish foreign minister inhistory to say so, but here it is: I fearGerman power less than I am begin-ning to fear German inactivity. Youhave become Europe’s indispensablenation. You may not fail to lead.”

The applause at the end of MrSikorski’s speech was genuinelywarm, if permeated by a sense ofshock.

Perhaps fittingly, it was formerpresident Horst Köhler – himselfborn in Poland – who stood up andthanked Mr Sikorski: “For you as Pol-ish foreign minister to give this speechhere today – I think it’s wonderful.” ●

Constanze Stelzenmüller is aSenior Transatlantic Fellow with the

German Marshall Fund in BerlinCopyright: German Marshall Fund

of the United States

“I fear German power lessthan I am beginning tofear German inactivity”

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A series of developments over thelast few weeks have set in motiona downward spiral for the euro

zone. Unless officials – especially Ger-man ones – act fast, the verdict of finan-cial markets is bound to be ruthless.

First of all, the euro zone hasfailed to turn the tide. Mario Draghi,president of the European CentralBank, was right to note that, despitenumerous ministerial meetings andthree summits, implementation of thedecision to increase significantly thefirepower of the European FinancialStability Facility (EFSF) is still lack-ing. There are now growing doubtsabout the effectiveness of the EFSF.

Second, and partly as a conse-quence, virtually all euro zone coun-tries’ debt is trading at a discount rel-ative to German Bonds. While it wasnecessary to price risk more accurate-ly, it is difficult to believe that theNetherlands, with a debt ratio nearly20 percentage points lower than Ger-many’s, deserves to be assessed as ahigher default risk. But now even themighty Bond has started to sufferfrom heightened market anxiety.

Third, financial-market partici-pants and increasingly real businesses,are pricing in a possible breakup ofthe euro zone, if not the end of the

euro itself. It is still difficult to thinkthe unthinkable, let alone work outthe details of it, but any rational play-er must now consider the possibility.If expectations of disaster build and agrowing number of players start posi-tioning themselves to protect them-selves, the consequences couldbecome overwhelming. Not only theeuro zone would suffer.

Fourth, Germany has become theeuro zone’s undisputed leader.Although France continues to play itsrole as the other half of the EuropeanUnion’s leading couple, it has lostinfluence and the ability to take theinitiative. A weaker French economy,shakier public finances, and the com-ing presidential election are all com-bining to alter the balance with Ger-many. Political audacity can carryFrance only so far.

A recurring themeIn this context, Germany again findsitself in a situation akin to that of thelate 1980s, when the Bundesbank wassetting monetary policy for the rest ofthe continent. At that time, GermanChancellor Helmut Kohl wisely con-cluded that German economic domi-nance of Europe was not conducive toa stable equilibrium, and that a better

plan for the future was to build onGermany’s weight and influence tocreate a permanent common mone-tary order. Kohl’s insight gave birth tothe euro.

Today, once again, it is in Ger-many’s best interest to ensure lastingstability in Europe. With foreignassets worth €6 trillion ($7.9 trillion),most of which consist of claims on itseuro zone partners, Germany wouldlose out massively if the euro zonefragments. Claims on entities withinpartner countries would be re-denominated in weaker currencies –or the borrowers would default onthem. Obviously, German exporterswould be hurt by substantial currencyappreciation.

Leading roleGerman Chancellor Angela Merkelhas sensibly decided to take the leadon reforming the euro zone. But manyGermans feel deceived by some irre-sponsible euro zone partners, givingrise to the temptation to use Ger-many’s current strength to toughensanctions and coerce weaker countriesinto adopting constitutional changes,especially concerning fiscal policy.

This is a risky attitude. To be sure,Germany has far more leverage today

than it has had at any point in the last20 years. But attempting to extractunilateral concessions from partnersis a recipe for disappointment. It isone thing to be sanctioned for breach-ing the rules, as with the Stability andGrowth Pact; it is quite another thingto permit elected national govern-ments and parliaments to be over-ruled, and national budgets censored,by an unelected higher authority.

Give and takeThe EU’s members are unlikely toagree to major reform unless Ger-many offers something in return.Absent a more balanced deal, what islikely to emerge from negotiations issimply another layer of largely ineffec-tual and ultimately divisive sanctions.

The natural quid pro quo for exante budgetary control is solidaritythrough the creation of euro bonds.Joint and several liability for publicbonds is imaginable only if countriesoffering their guarantee – and thuspotential access to their taxpayers –can exercise veto power and preventa partner country from issuing moredebt. Thus, legally binding ex antecontrol is a necessary condition foreuro bonds. Conversely, surrenderingbudgetary sovereignty to euro zone

partners is acceptable only if itaccompanies their guarantee thatthey will come to the rescue in case ofaccident.

Germany should be bold and useits leverage to offer a new contract toits euro-zone partners: mutual guar-antee of part of their public debt inexchange for strict debt limits and a

new legal order in which a euro zoneauthority can veto an enacted budgeteven before it is implemented. Onlysuch boldness will deliver the certain-ty that markets need – and it is Ger-many’s responsibility to be bold. ●

Jean Pisani-Ferry is director ofBruegel, an international economics

think tank, professor of economics atUniversité Paris-Dauphine, and a

member of the French prime minister’sCouncil of Economic Analysis.

Copyright: Project Syndicate, 2011.project-syndicate.org

The German hour

“Germany should be boldand use its leverage to

offer a new contract to itseuro-zone partners”

Jean Pisani-Ferry

DECEMBER 5-11, 2011CCOOVVEERR SSTTOORRYY12

Bids for

Ostro∏´ka Nine consortia have

submitted offers in the

tender for the

construction of a 1,000

MW electricity plant in

Ostro∏´ka. The contract is

valued at z∏.6-7 billion.

Among those who

submitted tenders are

Polimex-Mostostal with

Hitachi, Pol-Aqua and

Dragados, and a

consortium of Rafako,

PGB and Mostostal

Warszawa.

z∏.50 billion

bonds

buy-back?Poland’s Finance Ministry

is prepared to use around

z∏.50 billion in national and

foreign currencies to fight

the z∏oty’s depreciation

and prevent the public

debt from surpassing 55

percent of GDP, reported

Gazeta Prawna. The

ministry has announced an

auction to buy back

Treasury bonds that reach

maturity in 2012 starting

on December 19.

Polish

companies

keep investing Despite uncertainty

linked to the euro-zone

crisis and a slowdown in

Western Europe, Polish

companies spent 16%

more on investments in

the third quarter of 2011

than in the same period

last year, reported Puls

Biznesu. Meanwhile,

SMEs of over 50

employees spent z∏.24.8

billion on development

investments, which

represents a 16.4% y/y

increase, according to the

Central Statistical Office.

Poles save big

The Polish National Bank

estimates the combined

financial assets of Polish

households amounted to

z∏.0.99 trillion at the end

of September 2011. The

figure includes cash, bank

deposits, and savings in

pensions and investment

funds, as well as

shares in public

companies held by

individual investors,

reported Rzeczpospolita. ●

www.wbj.pl

Libya

PPoolliisshh bbuussiinneesssseess llaayy ggrroouunnddwwoorrkkffoorr ggrreeaatteerr iinnfflluueennccee iinn ffrreeee LLiibbyyaa

On October 23, just days afterthe death of Libyan dictatorMuammar Gaddafi signalledthe end of eight months of civilwar, Libya’s new authoritiesannounced the final liberationof the country. The next dayPolish Foreign MinisterRados∏aw Sikorski arrived,marking the first visit by a for-eign politician to the newlyfree Libya.

Interestingly, Mr Sikorskiwasn’t alone. Accompanyinghim on his historic trip weresenior executives from fourmajor Polish energy compa-nies – state-owned oil refinersPKN Orlen and Grupa Lotos,state-controlled oil and natu-ral-gas giant PGNiG, as well asprivately held oil exploratoryfirm Petrolinvest.

The high-ranking companyofficials spoke with Libya’snational oil company, theNational Oil Corporation, andthe Libyan Business Council,an organization that aims tofoster partnership deals withforeign companies that wantto work in Libya.

Earlier this year, while thefighting was still going on, rep-resentatives of the then-rebelforces had suggested that theywould remember which sidescountries had taken during theconflict, and would negotiatebusiness deals in the free Libyaaccordingly. It seems clear thatPoland, which at least diplo-

matically had supported therebels’ cause from the begin-ning, was intent on capitalizingon the opportunity.

Oil, oil, oilIndeed, Poland’s Foreign Min-istry makes no effort to hide itsactive role in assisting Polishbusinesses that want to estab-lish operations in Libya. But itdenies that the energy sector isits focus.

“More and more Polishentrepreneurs are graduallybecoming interested in moredistant economies, includingthe Libyan one. The PolishMinistry of Foreign Affairsand our embassy in Tripoli willtake all the necessary meas-ures to provide them with ourdiplomatic support,” KonradZieliƒski a spokesperson forthe Polish Ministry of ForeignAffairs, told WBJ. But, headded, “there aren’t any sectorpreferences regarding ourrelations with Libya.”

Nevertheless, in a countrywhere hydrocarbons account-ed for more than 70 percent ofGDP and more than 95 per-cent of exports before the waraccording to the InternationalMonetary Fund, the sectorswhich would be most lucrativefor Polish companies are obvi-ous enough.

PGNiG is the only Polishenergy giant to have operatedin pre-war Libya. The Octo-

ber visit of the other big Pol-ish oil and gas players, whohave so far concentratedmostly in European markets,suggests that they too are nowtempted to explore sources ofincome beyond their tradi-tional markets.

After the warPolish Oil and Gas Company(POGC) Libya, PGNiG’s affil-iate company, beganexploratory work in theMurzuq basin, southern Libya,in 2008. The start of drillingwas planned for April thisyear, but was postponed whenthe company suspended itsoperations with the eruptionof hostilities in late February.

Fighting is estimated to

have damaged 10 percent ofthe country’s oil infrastructureand PGNiG’s operations didnot escape unscathed. Thecompany confirmed that someof its drilling and office equip-ment at its exploration base inthe Murzuq basin suffereddamage during the recentconflict.

Waldemar Wójcik, CEO ofPOGC Libya, was part of thePolish delegation that visitedTripoli and Benghazi in Octo-ber. There he received confir-mation that the firm’s agree-ments with Libya’s national oilcompany still held under thenew regime.

“Mr Wójcik’s meetingswere very brief and generaland resulted in confirming the

validity of our existing con-tract with the National OilCorporation. Both NOC andPOGC declared a commonwill of further cooperation,”said PGNiG spokespersonJoanna Zakrzewska. Potentialnew exploration, develop-ment and production con-tracts will be considered anddiscussed, she added.

Without giving a specifictime-frame, PGNiG says it willbe back operating in Libya assoon as possible. “Libya is oneof the strategic countries in theoverall exploration assets port-folio of the PGNiG Groupbecause the potential of undis-covered reserves of oil and gasare very attractive,” said MsZakrzewska.

Some of Poland’s major energy firms havealready paid a visit to the country in an attemptto secure business deals in this potentiallylucrative new market

Liam Nolan

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Polish FM Rados∏aw Sikorski arriving in Libya on October 24

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Rados∏aw Sikorski’s first visit to Libya was welcomed

by anti-Gadaffi supporters in Benghazi

Americas

Norway

Europe

Russia

Former Soviet Union

LibyaAfrica

Iran

Saudi Arabia

Middle East

3.30%13.09%

29.70%

10.71%

5.66%

6.01%

15.59%

42.40%

21.62%

17.09%

Where the oilcomes from

Crude oil imports to

the European Union

(EU27) in 2010

Source: European Commission Directorate-General for Energy

DECEMBER 5-11, 2011 CCOOVVEERR SSTTOORRYY www.wbj.pl 13

Polish bank tax

The Polish government is

making progress on a

planned bank tax, which

aims to constitute a

reserve for Poland’s

banking system. The

Finance Ministry could

complete work on the

legislative project within

a few months, said

Deputy Finance Minister

Maciej Grabowski last

week. The bill would then

be submitted to

parliament for vote.

Layoffs ahead

The total number of

employees Polish

companies plan to lay off

in 2011 is set to reach

around 30,900, according

to the Central Statistical

Office. Most redundancies

are expected to come

from the public sector,

with 16,400 state

employees set to lose

their jobs. The figures

represent a decrease on

last year, when 478

employers said they

intended to lay off 43,400

employees, including

25,500 from the public

sector.

Agricultural

property boom

Polish government

institution the

Agricultural Property

Agency (ANR) expects to

have sold 120,000

hectares of land by the

end of 2011, already a

sizable increase on the

97,000 hectares it sold

for the whole 2010,

reported Puls Biznesu.

ANR is expected to

contribute a total of z∏.3

billion to this year’s state

budget. ●

Long-term processPolish companies are awarethat establishing or reestab-lishing business links in post-war Libya might take sometime. PKN Orlen, Poland’slargest oil refiner, says it iseying projects in oil explo-ration and production as wellas in export. “Potential fr-ames of cooperation that thecompany may be interested ininclude upstream projectsand the sea export of oilproducts from Libya,”spokesperson Joanna Puskartold WBJ. However, she em-phasized the nascent natureof talks with the Libyan Busi-ness Council and the Nation-al Oil Corporation. “It is hardto expect definite effects ofthe business talks at thispoint,” she said.

Bertrand Le Guern, presi-dent of Petrolinvest’s man-agement board and the com-pany’s representative inLibya during October’s visit,said prospects for doing busi-

ness in Libya are “extremelypromising” in the longerterm. “This trip was a veryinteresting and anticipativefirst step in order to under-stand what kind of develop-ment perspective could openfor us in the long run in thisregion,” he told WBJ. How-ever, the firm is “not in aposition to take advantage ofopportunities in the shortterm,” Mr Le Guern added.

Investors interested inLibya face logistical chal-lenges in terms of transporta-tion, banking, security andinfrastructure, as well as thethreat of political instability.According to Mr Zieliƒskifrom the Foreign Ministry,“All interested parties arewaiting for a declarationregarding the model of thenew Libyan economic system.Since there are still morequestions than answers, theinternational business com-munity is staying mostly ‘onhold,’ and at the same time is

trying to secure its presencein the Libyan market.”

Indeed, over 40 years underthe rule of dictator MuammarGaddafi and eight months ofcivil war have had a devastat-ing impact on economic activi-ty, and today the task facingthe Libyan government, as wellas its businesses and citizens, isgargantuan. According to theIMF, real GDP is expected tocontract by more than 50 per-cent in 2011.

But if Libya wants a shot atrapid reconstruction, it needsto quickly restore oil produc-tion to generate revenues.

A competitive marketLibya accounts for only 2 per-cent of the world’s oil output,but almost 11 percent of crude-oil imports to the EuropeanUnion. According to OPEC fig-ures, Libyan oil fields werepumping out 1.6 million barrelsper day before the outbreak ofthis year’s civil war. Duringfighting, production decreasedby over 80 percent, according toestimates by the Energy Invest-

ment Authority. Production lev-els are now expanding rapidly,but they still represent a smallfraction of what was producedprior to the war. Some 840,000barrels were produced per dayat the end of November,according to the NOC.

Whatever Polish firms planfor Libya, they will need totake into account the designsof a number of well estab-lished Western Europeancompanies which will offerstiff competition to newcom-ers. Those include Italianenergy giant ENI, FrenchTotal, Austria’s OMV, Ger-many’s Wintershall Holding,BP of Britain and Repsol YPFof Spain.

Robert Zajdler, an energyexpert at the Sobieski Institutein Warsaw, believes Polishenergy firms could competewith other European players.“More and more Polish com-panies are showing an interestin the Libyan upstream mar-ket. I have the impression thatwe are in the process of devel-oping the Polish upstream

market in Libya,” he said. But they will have to face

competition from French,German and Italian compa-nies which are “trying to divideup the country’s upstreammarket,” he added.

Yet the most unpredictablefactor for Polish firms remainsthe security situation. “Thecountry is still unstable andunsecured for foreign person-nel. The resumption of perma-nent airline operations is thefundamental condition for oilcompanies to return to normalactivities,” said PGNiG’s MsZakrzewska.

Libya’s first post-revolu-tionary general election isexpected to take place sometime in mid-2012, and Polishenergy companies are likely towait until that moment to seri-ously pursue future explo-ration contracts with anyfuture Libyan government. ●

Note: Both Grupa Lotos andthe National Oil Corporationof Libya declined to commentfor this article

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Libyan oil fields produced 1.6 million barrels a day before the civil war broke out

“The country is still unstable and unsecured for foreign personnel”

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The FM met the chairman of Libya’s NTC in May

DECEMBER 5-11, 2011CCOOMMPPAANNYY FFOOCCUUSS14 www.wbj.pl

Poland’s consumerelectronics market ischanging rapidly,reflecting the evolvinglifestyle choices of thecountry’s consumers

Since it began life in 1998 as amaker and retailer of comput-er-game accessories, Mantahas had to adapt to numerousnew trends in the consumerelectronics market, makingsignificant changes to its busi-ness model along the way. Asdemand in its original marketdried-up, the company broad-ened its portfolio to allow it tocompete in Poland’s electron-ic appliances market.

“Computer game productshave decreased as a share ofour portfolio; the user doesn’tneed extra computer gameequipment nowadays as every-thing comes integrated,” saidBogdan Wiciƒski, Manta’sCEO.

To survive in Poland’s fast-developing electronics marketManta has had to keep a closeeye on the evolving demandsof consumers, whose ever-changing lifestyle choices arestrongly reflected in the prod-ucts they buy.

As demand for computer-

game accessories shrunkManta entered the DVD mar-ket, launching its first DVDplayer in 2003 and sellingsome five million unitsbetween then and 2010. Now,though, the company is onceagain being forced to changetack due to another major shiftin the electronics market.

“The DVD player markethas been diluted – it is multi-media products from the con-sumer products range we arenow developing,” said MrWiciƒski.

Lifestyle productsManta sees TV sets and smart-TV boxes, along with tablets,as being its most successfulproducts in the next two tothree years.

This outlook is in line withforecasts made by BusinessMonitor International (BMI),which sees computer hard-ware sales (which accountedfor about 47 percent ofPoland’s consumer electron-ics spending in 2010) beingdriven by demand for note-books and tablets. The com-pound annual growth rate(CAGR) of the computerhardware sector in the 2011-2015 period is forecast ataround 7.3 percent.

Flat-screen TV sets areexpected to drive demand inthe AV devices sector, wheresales of video products aredeclining, BMI said in areport.

Poland’s entire consumerelectronics devices market isforecast to be worth around$7.4 billion by the end of2011, and to grow at a CAGRof 6.6 percent, to $9.5 billion,by 2015. Growth is expectedto be driven by the increasingpopularity of “digital lifestyleproducts,” such as feature-rich mobile PCs and LCDTV sets.

The e-reader market is alsoseen as an area of growth, withManta poised to dive in.

“We are going to enter thee-reader market and alreadyhave two products ready and athird in the pipeline,” said MrWiciƒski.

Expansion plansKeen to start bringing originalprojects to market, Manta hasset up an innovation incuba-tor, which supports youngentrepreneurs entering themarket for cutting-edge tech-nology under the auspices ofthe Manta brand.

The company itself hasrecently launched a multime-

dia player that is able to showthree-dimensional movieswithout the need for the view-er to wear special glasses. This,the company says, is a uniqueproduct.

Plans for expansion intocountries in Eastern andWestern Europe are alsoafoot, with the company dueto have its products showcasedby the Polish government dur-ing CeBIT, an internationaltrade fair for the digital indus-try, held in Hanover, Ger-many, in March 2012.

“We want to show that weare not just an emerging econ-omy – that we can develophigh-end products too,” saidMr Wiciƒski.

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The bottom line

Due in large part to cost-cut-ting measures, by the end ofOctober 2011 Manta hadalready exceeded the z∏.4.4million net profit it achievedfor full-year 2010, reporting abottom line of z∏.6 million forthe first 10 months. A profitof somewhere between z∏.6-7million is expected for full-year 2011.

A large IT system invest-ment, as well as increasedoutsourcing and consolida-tion of production facilitiesare expected to contributefurther to cost-cutting.

The company is also creat-ing Polish jobs in the process.“We produce mainly in China,but recently we launched pro-duction of certain items in

Poland, including LCD andLED sets,” Mr Wiciƒski said.The company hopes one dayto produce its products almostexclusively in Poland.

“This would be cost-effec-tive, but it would also allow meto have 100 percent controlover quality – to ensure that notone piece of equipment isdefective,” Mr Wiciƒski said. ●

Electronics

MMaannttaa eeyyeess mmuullttiimmeeddiiaa pprroodduuccttss ttoo ddrriivvee ggrroowwtthh

TV sets, especially flat-screens, are a big part of

Manta’s plans for the next two to three years

The building willcomprise 15,300 sqmof class-A office space

Developer Hines Polska hasreceived a building permit foran office center in Gdaƒsk thatwill replace the former Neptundepartment store. The new 18-storey scheme, called the Nep-tun office center, will comprise15,300 sqm of class-A officespace.

Before construction on theproject can begin, the contrac-tor – Budimex – will have todismantle the old retail center.The whole investment isexpected to be finished by thefirst quarter of 2014.

The development, whichwas designed by the Aedasarchitectural studio, will havea reception area, and serviceand retail space on its groundfloor. The first floor will housea restaurant, several confer-ence rooms, a coffee shop anda press lounge.

The building will also have

elevated floors and suspendedceilings, making it easier torearrange office space whenunits are leased out.

Micha∏ Samborski, projectmanager at Hines Polska,said, “We are going to offeran advanced office buildingwhich satisfies all the require-ments for a class-A building –in terms of the location, tech-nical systems, functionalityand professional manage-ment.”

In a statement, the compa-ny said “considering thedynamic growth of the econo-my and tourism in Tri-city, aswell as an increase in the pur-chasing of apartments, thisoffice building is the answer tothe needs of companies fromthe financial, insurance andconsulting sectors.”

The company stressed thatthe project was designed withthe environment in mind.

“We care about the environ-ment and sustainable energy,”Mr Samborski said. The com-

pany hopes to obtain aBREEAM certificate of energyefficiency and environmental

performance for the building.Hines Polska was responsi-

ble for the development of the

Quattro Towers residentialcomplex, also in Gdaƒsk.

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LLOOKKAALLEE IIMMMMOOBBIILLIIAAW a r s a w B u s i n e s s J o u r n a l ’s w e e k l y s u p p l e m e n t o n r e a l e s t a t e , c o n s t r u c t i o n a n d d e v e l o p m e n t • DECEMBER 5-11, 2011, LI 16/48

€210 million

mall financingBanks Helaba and pbb

Deutsche Pfandbriefbank

have granted €210 million

to Immofinanz Group. The

money will be spent on

the refinancing and

development of its Silesia

City Center shopping mall

in Katowice. Bought by

Immofinanz Group in

2005, the project is the

largest mall in the Upper

Silesia region.

Galeria

Bialska design

unveiled

The Warsaw-based vsf-

creative architecture and

design practice has

designed the concept for a

new shopping center

which KPBP Budus, KPM

Agata and Graf will

develop in Bia∏a Podlaska,

Lubelskie voivodship.

Construction on the

project is expected to

launch in April next year

with the opening

scheduled for October

2013. The planned

development, which will

be called Galeria Bialska,

will comprise a total of

approximately 25,000 sqm

of GLA. The investment

will include a shopping

gallery with some 70

stores. ●

Hines in Gdańsk . . . . . . . . . . . . .15

Baltic Park Molo scheme . . . . .15

Mercure hotel closing . . . . . . . .16

Chmielna 25 contractor . . . . . .16

Zebra Tower LEED-certified . . .16

Property-related stocks . . . . . .16

Office obsolescence . . . . . . . . .17

Wrocław mall project scrapped18

Warimpex sells hotels . . . . . . .18

In this issue

1817

The aging of existing stock will

be a major challenge in the

office sector in the near future

Billionaire Zygmunt Solorz-˚ak

will not develop a shopping mall

near Wroc∏aw’s soccer stadium

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The Neptun office building is scheduled to be completed in Q1 2014

Office buildings

Hines receives permission to build Neptun in Gdaƒsk

To subscribe: e-mail subscribe@wbj.pl or call +48 22 639 85 68, ext. 201 and sign up for free two-week no-obligation trial subscription

Warsaw Business Journal presents Real Estate weekly newsletter

• Know about the newest projects before they’re on the market• Keep up to date on the latest tenders and auctions• Learn the latest trends in Poland’s dynamic office, residential and retail sectors • Find out who’s who in Polish real estate

or

Zdrojowa Invest to build Baltic Park Molo in ÂwinoujÊcieDeveloper Zdrojowa Invest hastaken over from Danish devel-oper Kristensen Group for aproject to build a mixed-usedevelopment in ÂwinoujÊcie, acity located on Poland’s Balticcoast. The investment, calledBaltic Park Molo, is expected tocost z∏.200-250 million and willcomprise at least four buildings,including hotels and apart-ments.

A four-star hotel and a five-star hotel are planned to bebuilt as part of the develop-ment. These buildings will fea-ture a wellness center, a retail,recreation and art space, awater park and a cinema. Therewill also be parking places for500-600 vehicles.

Two residential buildings,due to offer between 600 and700 apartments, are alsoplanned. The residences will bepriced from z∏.11,000-18,000per sqm.

Jan Wróblewski, a boardmember at Zdrojowa Invest,said “this will be one of thelargest business hotel centers inthe area and one of the largestin Poland.”

“We plan for one of thehotels in the complex to func-tion under a well-known inter-national brand,” he added.

Construction on the devel-opment is slated to begin by theend of 2012, or from early 2013,and be delivered in severalphases. It is expected to becompleted at some pointbetween 2014-2017.

The design of the develop-ment will be selected through acompetition that will belaunched on December 6. Thecontest will be open to bothlocal and foreign architects.The winner will be selected onMarch 15, 2012 and announcedon March 20, 2012.

EEllllaa PPaa∏∏kkaaA visualization of the potential future Baltic Park Molo

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DECEMBER 5-11, 2011LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– RREEAALL EESSTTAATTEE16 www.wbj.pl

Multikino in

Makrum mall

Makrum, the investor

behind the eponymous

shopping center project

in Bydgoszcz, Kujawsko-

Pomorskie voivodship,

and multi-screen cinema

operator Multikino, have

signed a letter of intent

concerning the cinema’s

presence in the planned

mall. The parties expect

to sign a long-term

lease agreement by the

end of this year. The

development will include

a shopping gallery with

180 stores, a 7,900-sqm

Tesco hypermarket and a

9,000-sqm Praktiker DIY

store.

New Ostro∏´ka

mall

A new shopping mall

called Galeria

Bursztynowa will be

developed by Narev

Inwestycje in Ostro∏´ka,

Mazowieckie voivodship.

Cushman & Wakefield

has been appointed the

exclusive leasing agent of

the scheme. The Galeria

Bursztynowa project will

comprise approximately

20,000 sqm of leasable

retail space and an

additional 8,000-sqm DIY

store. ●

Security Closing % change 52-week 52-week % change Total Marketprice (week) low high (year) shares value

on Dec 1 (z∏. mln)

BUDIMEX 72.55 3.79 64.00 109.20 -26.57 25,530,098 1,852.21

CELTIC 19.00 5.56 15.55 60.55 N/A 34,068,252 647.30

DOMDEV 31.98 -6.49 23.50 50.80 -18.04 24,560,222 785.44

ECHO 3.40 5.59 3.22 5.55 -30.61 420,000,000 1,428.00

ELBUDOWA 95.40 -2.60 94.50 170.00 -40.38 4,747,608 452.92

ENERGOPLD 2.20 -4.35 2.20 4.10 -41.95 70,972,001 156.14

ERBUD 17.40 8.75 14.70 61.00 -68.36 12,644,169 220.01

GANT 5.95 -6.30 5.95 17.63 -66.48 20,499,953 121.97

GTC 9.65 9.53 8.64 24.98 -60.07 219,372,990 2,116.95

HBPOLSKA 0.78 -1.27 0.70 3.20 -73.91 210,558,445 164.24

JWCONSTR 4.85 -10.35 4.83 17.24 -71.74 54,073,280 262.26

LCCORP 0.91 2.25 0.85 1.69 -41.29 447,558,311 407.28

MARVIPOL 9.05 10.91 7.22 11.99 -24.14 36,923,400 334.16

MIRBUD 2.40 13.21 2.10 4.75 -42.58 75,000,000 180.00

MOSTALWAR 20.50 -1.44 19.70 62.95 -65.86 20,000,000 410.00

MOSTALZAB 1.22 -5.43 1.07 3.37 -59.87 149,130,538 181.94

ORCOGROUP 14.96 -5.26 14.19 40.00 -50.53 17,053,866 255.13

PBG 72.85 3.70 56.05 223.00 -66.99 14,295,000 1,041.39

PLAZACNTR 2.00 0.50 1.80 5.15 -59.51 297,174,515 594.35

POLAQUA 6.70 5.18 6.37 20.60 -62.32 27,500,100 184.25

POLIMEXMS 1.35 -0.74 1.23 4.15 -66.25 521,154,076 703.56

POLNORD 14.20 -8.97 11.03 35.50 -59.64 23,798,439 337.94

RANKPROGR 9.00 3.45 8.64 13.60 -17.43 37,145,050 334.31

ROBYG 1.12 0.00 1.04 2.13 -39.78 257,390,000 288.28

RONSON 0.91 -1.09 0.84 1.58 -37.67 272,360,000 247.85

TRAKCJA 1.23 -3.91 1.20 4.29 -70.71 232,105,480 285.49

ULMA 61.25 -0.08 57.00 88.00 -26.20 5,255,632 321.91

UNIBEP 5.36 2.10 4.47 10.30 -44.46 33,927,184 181.85

WARIMPEX 4.05 -10.60 4.05 10.89 -55.74 54,000,000 218.70

ZUE 7.40 -4.88 7.40 14.75 -49.83 22,000,000 162.80

Property-related stocks

Warsaw's Zebra Tower obtains LEED Gold certificationUnion Investment’s ZebraTower office building in Warsawhas been awarded a LEEDGold certificate in the “Shelland Core” category. Featuresincluding the presence of ener-gy- and water-saving solutions,finishing materials that do notemit pollutants and preferredparking for low-emission vehi-cles contributed to the schemeachieving the certification.

“LEED certification isbecoming one of the top criteriafor many tenants today, and itreinforces the strong businesscase we have made for a cost-effective energy solution thatlowers tenants’ occupancycosts,” Reinhard Schertler,managing director at S+BGruppe, which developedZebra Tower, said in a state-ment.

“Zebra Tower brought usoutstanding renting perform-ance in 2011 and one of the keyfactors in this process was itssustainability,” Mr Schertleradded. He pointed out that theproject was one of the fewoffice schemes which were con-structed and successfully leasedin Warsaw during the last threeyears.

Located on Warsaw’s ul.Mokotowska, the 17-storeyZebra Tower developmentcomprises 18,280 sqm of space,almost all of which is currentlyleased out to tenants includingAllegro Group, Investors TFI,Millennium Bank, Samsungand S+B Gruppe.

Union Investment acquiredZebra Tower at the beginningof the year for approximately€76 million. AAZZ

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Zebra Tower is located on ul. Mokotowska and comprises 18,280 sqm of space

Hospitality

Warsaw’s Mercure Fryderyk Chopin Hotel to closeThe facility will bedemolished to makeway for a new officetower

The Mercure Fryderyk ChopinHotel in Warsaw will close forgood on December 15.

The closing of the hotel isrelated to its acquisition from

Orbis Group by developerEcho Investment, which isplanning to develop a 155-meter skyscraper with some45,000 sqm of office space onthe site.

“The planned tower will beperfectly located and will addnew quality office space todowntown Warsaw,” said Woj-

ciech Gepner, public relationsmanager at Echo Investment.

He added that early nextyear the company will presentthe concept of the plannedscheme. The Kury∏owicz &Associates Architecture Studiois working on the design of theskyscraper.

This isn’t the first Orbis-

Echo deal in Poland. Earlierthis year, Orbis Group sold twoof its hotels, the Cracovia inKraków and the Neptun inSzczecin, to Echo InvestmentGroup. The combined cost ofthe transactions was z∏ 59.5 mil-lion.

The Mercure FryderykChopin Hotel opened in 1993.

It is expected to be demolishednext year. The scheme joins agrowing list of relatively newstructures in downtown War-saw which could soon give wayto taller, more modern build-ings. Other such projectsinclude the Ilmet and Kaskadaoffice schemes.

VVeerroonniikkaa JJooyy

Chmielna 25 contractor chosenReal estate investor LHI hasselected construction companyBudner as the general contrac-tor for its Chmielna 25 officeand retail project in downtownWarsaw. Construction on theseven-storey, class-A scheme,which will be located on thecapital’s ul. Chmielna, isscheduled to launch inDecember and finish in thesecond quarter of 2013.

“The selection of an experi-enced and reliable contractoris one of the key decisions inthe investment process. In thecase of the Chmielna 25 officebuilding, it is all the moreimportant because of the

restrictive procedures involvedin the development of a facilitywhich is applying for LEEDcertification,” LHI CEORobert Mand˝unowski said ina statement.

“We are glad that theinvestment will be built byBudner, which has ampleexperience in the developmentof commercial, includingoffice, projects in Warsaw andother Polish cities,” he added.

Designed by the Bulanda,Mucha Architekci studio, theChmielna 25 development willcomprise a total of 7,135 sqmof usable space, including over3,800 sqm of office and almost

1,800 sqm of retail space. Theinvestment is expected toobtain a LEED certificate ofenergy efficiency and environ-mental performance.

LHI has until recentlybeen mostly known for itsproperty leasing activity. Nowthe company is increasinglyturning its attention to realestate project financing withChmielna 25 being the com-pany’s second investment incentral Warsaw in recentyears, after the Nowy DomJab∏kowskich project, whichofficially opened for businessin September.

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DECEMBER 5-11, 2011 LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– RREEAALL EESSTTAATTEE www.wbj.pl 17

Office properties

TThhee oobbssoolleesscceennccee ooppppoorrttuunniittyyChanging life cycles ofbuildings will be botha blessing and a cursein the office sector inupcoming years

As ever more advanced andmore sustainable technologiesare employed in the construc-tion of new office develop-ments, the rapid aging of theexisting office stock in Europeis bound to become one of themost important issues in theindustry by the end of thedecade, according to recentresearch by Jones LangLaSalle.

The postulate is one of themajor conclusions in the com-pany’s Offices 2020 researchprogram which was based ontopic suggestions made by anumber of key office real estatemarket players. The studyfound that office space obsoles-cence, resulting from shorten-ing building life cycles, willincreasingly expose office facil-ities to rental and capital deval-uation.

Europe-wide trendThe trend will arguably soon bemost acutely felt in matureoffice markets such as London,where much of the existing

office stock is a few decadesold, noted Bill Page, head ofEMEA office research at JonesLang LaSalle. However, hestressed that the problem willultimately also concern loca-tions with relatively youngoffice stock.

In Warsaw, for instance,buildings delivered just adecade ago often do not havethe highly advanced specifica-tions featured by the latestoffice projects and may thussoon prove to be out of touchwith current market require-ments, said Anna Bar-toszewicz-Wnuk, head ofresearch at Jones LangLaSalle’s Polish office.

“In the 1990s, over1,055,000 sqm of modern officespace was delivered in Warsaw.Since 2000, an additional2,550,000 sqm has hit the mar-ket. It can be assumed that thesupply delivered in the 1990s,in particular, may becomefunctionally or technologicallyobsolete and will need adapta-tion to the future marketneeds,” Ms Bartoszewicz-Wnuk added.

Green driveThe drive towards sustainabili-ty will be the major factor con-tributing to the expected

increase in the obsolescence ofexisting office stock. “The leg-islative drive towards sustain-able construction will increas-ingly confront property ownerswith the question of whethertheir real estate can be used atall,” Mr Page said.

Moreover, as tenantsbecome increasingly environ-mentally-conscious and expec-tant that the space they rentfeatures environmentally-friendly solutions, sustainablebuildings will gain an ever morecompetitive edge in the mar-ket. In the near future, we maynot talk about class-A facilitiesany more, but about whether aparticular scheme is sustain-able or not, Mr Page added.

Refurbishment opportunitiesDoes all of this mean we canexpect a massive wave of officebuilding demolitions in theupcoming years? Probably not.Admittedly, there has beenmuch talk in Poland of late ofrelatively new Warsaw build-ings being replaced with newerstructures, with UBS’s planneddemolition of the Ilmet towerone of the most recent exam-ples. However, according to MrPage, the trend will rather be toupgrade existing stock.

“Office obsolescence willprovide opportunities forcompanies specializing inrefurbishment projects,” MrPage said. He added that

sometimes building greenfrom scratch would be anecessity, but that in the caseof projects which alreadyhave strong advantages, for

example due to a sustainablelocation, refurbishmentwould often be the preferredoption.

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The Ilmet office tower in Warsaw is one of a number of relatively young projects in

the city due to be replaced by a more modern structure

DECEMBER 5-11, 2011LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– RREEAALL EESSTTAATTEE18 www.wbj.pl

Warimpex sells budgethotel projects to Starwood

Austrian real estate develop-ment and investment companyWarimpex has sold its 50 per-cent stake in a joint budgethotel development project inCentral Europe to its partneron the project, Starwood Capi-tal Group, the company said ina statement. The value of thetransaction has not been dis-closed.

“This decision has a strate-gic focus. It’s still difficult toraise bank financing for proj-ects and it would have been dif-ficult to continue [at] the devel-opment speed that was origi-nally planned,” said ChristophSalzer, press spokesperson and

regional director forWarimpex.

Warimpex and Starwoodplanned to jointly developCampanile and PremiéreClasse hotels in order to focusand expand in Central Europe,specifically in Poland, theCzech Republic, Hungary andSlovakia.

The deal involves the sale ofseveral plots, as well as twounder-construction schemes indowntown Wroc∏aw which willbe operated by Starwood sub-sidiary Louvre Hotels and pro-vide 152 and 136 rooms.

The two Wroc∏aw projectsare sitting on a 14,000-sqm plot

of land near the city’s main rail-way station and will comprise atotal of approximately 6,000sqm of usable space. They arebeing built by Eiffage Budown-ictwo Mitex and are scheduledto open for business in Q12012.

Warimpex, which is listed onboth the Warsaw StockExchange and the ViennaStock Exchange, has so fardeveloped properties worth atotal of over €1 billion in theCEE region. The US-basedStarwood Capital Group cur-rently has some $16 billion ofassets under management.

VVeerroonniikkaa JJooyy

The deal includes the sale of two under-construction hotels in Wroc∏aw

Retail

Solorz-˚ak firm won’t buildWroc∏aw shopping centerHis company missedthe deadline formaking a decisionregarding the plannednew development

Polish billionaire ZygmuntSolorz-˚ak will not be devel-oping a retail center next toWroc∏aw’s municipal stadiumafter a company of his failed tocommit to a date to begin theproject.

Wroc∏aw City Hall invali-dated the land-lease contractthat had been given to thecompany.

Pawe∏ Czuma, a spokesper-son for the municipality, toldLokale Immobilia that the cityannulled the project after MrSolorz-˚ak’s company missedthe November 30 deadline formaking a final decision onwhether it would build theretail center.

“We were in talks with thecompany, yet no final decisionwas made so we decided toannul the agreement,” MrCzuma said.

The idea to build the retailcenter was born in 2009. Anagreement was signed at thattime allowing Mr Solorz-˚ak’scompany to develop the project.

Profits made from theinvestment were to fund theÂlàsk Wroc∏aw soccer club, inwhich Mr Solorz-˚ak’s com-panies together hold a majori-ty stake.

The four-storey structurewas to be built on 6.8hectares of land. Of the200,000 sqm of total con-struction space, 60,000 sqmwas meant to comprise retailspace which would haveincluded 150 shops, restau-rants and service points, aswell as a fitness and spa cen-ter and a bowling alley.

Mr Solorz-˚ak’s companydeclined to comment on thereasons behind its decision notto submit a final investmentdecision, but local media havereported that the investor wasunable to secure financing forthe project on acceptableterms.

Wroc∏aw City Hall is nowplanning to put the location upfor sale.

“The local developmentplan means that only a retailcenter can be built in itsplace,” Mr Czuma said.

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The planned mall was to be built next to Wroc∏aw’s

soccer stadium

A guide to Polish business and industry Przewodnik po polskim biznesie i gospodarce

The 2011 edition of Bookof Lists is now available!

• Find key information about the dominant players in the market • Expand your portfolio of contacts• See who’s on top of your sector

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DECEMBER 5-11, 2011MMAARRKKEETTSS20 www.wbj.pl

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4.51

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71

4.52

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4.54

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currency rates

Light at the endof the tunnel?

Currency report

After weeks of uncertaintyand fears about the future ofthe euro zone, markets got abig boost from central bankslast week. The largest institu-tions (including the Fed,ECB, BoJ, BoE and BoC)decided to launch a jointaction to provide liquidity tothe markets by decreasingrates on US dollar swaps by50 basis points.

A speech made last Fri-day by German ChancellorAngela Merkel appealed toinvestors. Ms Merkel alsohopes that troubled Euro-pean countries will agree onsome principles of a soundlong-term, more integratedfiscal policy. As reformstowards this end are imple-mented market confidencewill be restored, investorshope.

Meanwhile, macro newsfrom the US did not disap-

point, although the payrollsreading was a little belowmarket consensus. The un-employment rate declined to8.6 percent.

All these events causedmajor currencies to reactstrongly, meaning volatilitylevels increased this past week.The EUR/USD opened theweek just above $1.32 to reach$1.35, after the central banks’announcement, with the gateto $1.36 now open.

The z∏oty reached itshighest level since June 2009against the euro, at z∏.4.55,and June of 2010 against thedollar, at z∏.3.43, beforestrengthening slightly. Thecentral bank might still beinclined to intervene onceagain before the end of theyear to strengthen the z∏oty,in order to avoid crossing the55 percent public debt-to-GDP threshold. ●

Adam Narczewski, X-TradeBrokers Dom Maklerski SA

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Major indices

Top 5 Closing % change (week) 52-week high 52-week lowCEDC 15.40 54.31 83.50 9.27SOBIESKI 166.00 35.18 285.00 113.00KREZUS 7.33 22.17 8.39 2.07MIDAS 1.24 21.57 5.19 0.62ASBIS 1.42 20.34 4.25 1.03

WIG 39,215.21 (December 1 close)

Change for the week: 4.28% 52-week high: 50,371.74

Change year to December 1: -17.70% 52-week low: 36,549.47

Top 5 Closing % change (week) 52-week high 52-week lowGTC 9.65 9.53 25.19 8.56ASSECOPOL 49.64 9.36 56.60 34.50BRE 266.40 9.00 357.90 203.30PKNORLEN 39.75 7.72 58.85 30.33TAURONPE 5.40 6.51 6.92 4.65

Bottom 5 Closing % change (week) 52-week high 52-week lowFON 0.21 -50.00 0.85 0.15ATLANTIS 0.67 -40.18 1.92 0.35DREWEX 0.29 -27.50 2.75 0.28ELKOP 0.27 -25.00 0.49 0.17PRONOX 0.18 -21.74 1.76 0.14

Bottom 5 Closing % change (week) 52-week high 52-week lowGETIN 6.67` -1.91 15.29 6.02POLIMEXMS 1.35 -0.74 4.18 1.19LOTOS 25.15 0.56 49.50 22.32TPSA 18.27 1.50 19.19 14.30PGNIG 3.97 2.06 4.65 3.25

WIG20 2,265.03 (December 1 close)

Change for the week: 4.63% 52-week high: 2,932.62

Change year to December 1: -17.77% 52-week low: 2,089.84

mWIG40 2,183.45 (December 1 close)

Change for the week: 4.90% 52-week high: 2,987.72

Change year to December 1: -22.23% 52-week low: 2,081.49

sWIG80 8,706.80 (December 1 close)

Change for the week: 2.28% 52-week high: 12,932.00

Change year to December 1: -28.92% 52-week low: 8,483.22

NewConnect 41.46 (December 1 close)

Change for the week: 0.22% 52-week high: 64.04

Change year to December 1: -34.62% 52-week low: 41.31

WIG-Banki 5,535.82 (December 1 close)

Change for the week: 5.35% 52-week high: 7,387.49

Change year to December 1: -20.48% 52-week low: 4,944.19

DJIA12,020.03 (Dec 1 close)

6.77% (for the week)

CHANGE: 3.82%

(year to Dec 1)

52-week high: 12,928.50

52-week low: 10,362.30

NASDAQ2,626.20 (Dec 1 close)

6.75% (for the week)

CHANGE: -1.88%

(year to Dec 1)

52-week high: 2,887.75

52-week low: 2,298.89

S&P5001,244.58 (Dec 1 close)

7.13% (for the week)

CHANGE: -1.04%

(year to Dec 1)

52-week high: 1,370.58

52-week low: 1.074.77

FTSE1005,489.30 (Dec 1 close)

7.05% (for the week)

CHANGE: -6.96%

(year to Dec 1)

52-week high: 6,105.80

52-week low: 4,791.00

DAX6,035.88 (Dec 1 close)

11.20% (for the week)

CHANGE: -13.44%

(year to Dec 1)

52-week high: 7,600.41

52-week low: 4,965.80

NIKKEI2258,597.38 (Dec 1 close)

5.29% (for the week)

CHANGE: -16.95%

(year to Dec 1)

52-week high: 10,891.60

52-week low: 8,135.79

world stock indices

03.1

1

04.1

1

07.1

1

08.1

1

09.1

1

10.1

1

14.1

1

15.1

1

16.1

1

17.1

1

18.1

1

21.1

1

22.1

1

23.1

1

24.1

1

25.1

1

28.1

1

29.1

1

30.1

1

01.1

237,000

38,000

39,000

40,000

41,000

42,00003

.11

04.1

1

07.1

1

08.1

1

09.1

1

10.1

1

14.1

1

15.1

1

16.1

1

17.1

1

18.1

1

21.1

1

22.1

1

23.1

1

24.1

1

25.1

1

28.1

1

29.1

1

30.1

1

01.1

22,100

2,180

2,260

2,340

2,420

2,500

03.1

1

04.1

1

07.1

1

08.1

1

09.1

1

10.1

1

14.1

1

15.1

1

16.1

1

17.1

1

18.1

1

21.1

1

22.1

1

23.1

1

24.1

1

25.1

1

28.1

1

29.1

1

30.1

1

01.1

22,000

2,060

2,120

2,180

2,240

2,300

03.1

1

04.1

1

07.1

1

08.1

1

09.1

1

10.1

1

14.1

1

15.1

1

16.1

1

17.1

1

18.1

1

21.1

1

22.1

1

23.1

1

24.1

1

25.1

1

28.1

1

29.1

1

30.1

1

01.1

28,400

8,580

8,760

8,940

9,120

9,300

03.1

1

04.1

1

07.1

1

08.1

1

09.1

1

10.1

1

14.1

1

15.1

1

16.1

1

17.1

1

18.1

1

21.1

1

22.1

1

23.1

1

24.1

1

25.1

1

28.1

1

29.1

1

30.1

1

01.1

241.0

41.6

42.2

42.8

43.4

44.0

03.1

1

04.1

1

07.1

1

08.1

1

09.1

1

10.1

1

14.1

1

15.1

1

16.1

1

17.1

1

18.1

1

21.1

1

22.1

1

23.1

1

24.1

1

25.1

1

28.1

1

29.1

1

30.1

1

01.1

25,200

5,360

5,520

5,680

5,840

6,000

Other indices

An up-and-

down week

Stocks report

After a miserable week forstocks last time up, the startof December proved to be abetter one for markets.Though stocks continued tosee low volumes throughoutEurope, gains were madethroughout the region, as wellas overseas. Showing somesign of relief, market volatilityas measured by the CBOEVIX indicator slumpedthroughout the week by morethan 20 percent.

In Poland, the WIG see-sawed with solid gains onMonday following on fromthe previous week’s heavylosses. The relief rally wasshort-lived; however, BREBank and Bank Pekao bothsaw large gains. On Tuesday,markets dipped, thoughmost of Europe’s largestmarkets closed positive.

On Wednesday marketsrallied, posting huge gains

for stocks throughoutEurope and the US. Bypledging to lower the cost ofexisting dollar-swap lines toprevent a liquidity squeeze,the world’s leading centralbanks calmed investors’fears. Financials surged, withBank Handlowy (8.4 per-cent) and BRE Bank (7.48percent) leading the way.

Thursday saw marketspull back some gains, withaverage volumes also fallingprior to non-farm payrolldata being released. TheWIG closed 0.73 percentlower, with the WIG20 down1 percent. Friday, December2, saw markets once againpick up with the better-than-expected data on America’sjob front. Still, stocks slid inthe last hour of trade. TheWIG closed down 0.18 per-cent, while the WIG20closed 0.31 percent lower. ●

Andrew Nawrocki,WBJ market analyst

DECEMBER 5-11, 2011 TTHHEE LLIISSTT www.wbj.pl 21

Financial Services

Factoring CompaniesRanked by revenue from factoring in 2010 www.bookoflists.pl

Notes: NR = Not Ranked, WND = Would Not Disclose. Research for the List was done inNovember 2011. Number of employees and ownership structure are as of November 2011unless stated otherwise. All information pertains to the companies’ activities in Poland. Compa-nies not responding to our survey are not listed.

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

Rank

Company nameAddressTel./FaxE-mailWeb page

Revenuefrom

factoring (z∏. mln)

Totalrevenue (z∏. mln)

Full / Partial

Export / Import

Maximumrisk

covered / First pay-out

Firstpayment

due (days) /Commission

Collateral asked Sectors serviced

Debt collection /Analysis of

debtor’s financialsituation

Debtadministration /

Financial advisory /

Ledgermaintenance

Number ofclients /

Totalemployees /

Yearfounded

Ownership: Polish /Foreign

Top localexecutive /

Title

1

ING Commercial Finance Polska SAul. Malczewskiego 45, 02-622 Warsaw22 558-7400/22 558-7490sekretariat@ingcomfin.plwww.ingcomfin.pl

41.082.281.0127.8

44.687.287.6132.0

✓✓

✓✓

WNDWND

WNDWND

In blanco promissorynote witth declarations

WND✓✓

✓--

75WND1994

NoneING Lease Holding -

100%

Andrzej ˚bikowskiPresident

2

Polfactor SAul. Królewska 14, 00-065 Warsaw22 829-1460/22 829-1499sekretariat@polfactor.plwww.polfactor.pl

24.144.643.847.0

24.144.643.847.0

✓✓

✓✓

100%70-100%

Max. 2WND

Promissory note All sectors✓✓

✓✓-

WNDWND1995

BRE Holding - 100%None

Pawe∏ Bry∏a;Dariusz SteçBoard Members

3

Coface Poland Factoring Sp. z o.o.Al. Jerozolimskie 136, 02-305 Warsaw22 465-0235/22 465-4235factoring@coface.plwww.coface.pl

WND42.526.625.6

WNDWNDWNDWND

✓✓

✓-

80-100%WND

WNDWND

In blanco promissorynote; power of attorney

to a bank account

Industries in which firmssell goods and services

with a deferred payment

✓✓

✓--

WND28

2006

NoneCoface Austria Holding -

100%

Jaros∏aw Jaworski;Pawe∏ Tobis

President; Vice President

4

Pekao Faktoring Sp. z o.o.ul. Lubartowska 74A, 20-094 Lublin81 445-2000/81 445-2002biuro@pekaofaktoring.com.plwww.pekaofaktoring.com.pl

WND36.941.750.7

WNDWNDWNDWND

✓✓

✓✓

80-100%80-95%

1WND

In blanco promissorynote; power of attorney

to a bank accountAll sectors

✓✓

✓-✓

WND54

1998

Bank Pekao - 100%None

Miros∏aw JakowieckiWND

5

BZWBK Faktor Sp. z o.o.Al. Jana Paw∏a II 23, 00-854 Warsaw22 586-8292/22 586-8034faktor@bzwbk.plhttp://faktor.bzwbk.pl

18.228.831.639.1

18.128.931.939.5

✓✓

✓-

90%70-90%

1-2WND

In blanco promissorynote; power of attorney

to a bank account

Pharmaceutical;chemical; cosmetics;

telecom; sports;metallurgy; furniture

industry; medical; foodindustry; electronics

✓✓

✓--

48468

2003

Bank Zachodni WBKFinanse - 100%

None

Maurice TraceyPresident

6

Bibby Financial Services Sp. z o.o.ul. Wo∏oska 9A, 02-538 Warsaw22 545-6123/22 545-6124info@bibbyfinancialservices.plwww.bibbyfinancialservices.pl

14.621.619.319.0

14.821.919.619.0

✓✓

✓-

90%70-90%

1WND

In blanco promissorynote; power of attorney

to a bank account

Manufacturing; trade;services

✓✓

✓--

WNDWND2002

NoneBibby Group of Factors -

99.9%

Krzysztof KuniewiczGeneral Director

NR

Arvato services Polska, oddzia∏ Ber-telsmann Media Sp. z o.o. – faktoringul. Kolejowa 150, 62-064 Plewiska k/Poznania61 652-8800/61 652-8755faktoring@arvato.plwww.faktoring.arvato.pl

WNDWND13.212.5

WNDWND145.0246.0

✓✓

✓-

90%80-90%

7-180WND

In blanco promissorynote

All sectors✓✓

✓✓✓

3025

1994

NoneBertelsmann - 100%

Janusz JankowiakPresident

NR

Raiffeisen Bank Polska SAul. Pi´kna 20, 00-549 Warsaw22 585-2001/22 585-2585faktoring@raiffeisen.plwww.raiffeisen.pl/faktoring

WNDWNDWNDWND

WND1706.41407.01556.0

✓✓

✓-

Up to 100%Up to 100%

1WND

Power of attorney to abank account

All sectors✓✓

✓--

WND36

1991

NoneRaiffeisen Bank

International - 100%

Piotr CzarneckiPresident

1st half of 2011 / 2010 /2009 / 2008

Factoring Services

DECEMBER 5-11, 2011LLIIFFEESSTTYYLLEE22 www.wbj.pl

Watch Docs –Human Rights in FilmDecember 8-18Warsaw’s Centre for Contemporary Art Ujazdowski CastleWarsawFounded in 2001 by theHelsinki Foundation forHuman Rights, Watch Docs –Human Rights in Film is nowthe largest human rights filmfestival in the world, with over

70,000 people attending thefestival every year in Warsaw.

This year’s event will fea-ture films such as “Il Castel-lo,” which tells the story ofItaly's Malpensa Airport,“This is my Land,” a docu-mentary about the city ofHebron, which lies in the WestBank 30 km from Jerusalem,and “The Redemption ofGeneral Butt Naked,” a filmabout the former Liberian war

lord Roosevelt Johnson. Part of the official selec-

tion at the 2010 Cannes FilmFestival, “Women are He-roes,” a movie about womensharing their experiences ofdangerous situations, will alsofeature. The majority of filmscome with audio descriptionsfor the hard of hearing, andsubtitles. ●For more information log on towatchdocs.pl

Film festival

Watching over society

“Women are Heroes”C

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Disney – So Many Beautiful DreamsDecember 9, 2pm, 5pm and7:30 pmPKiN Sala KongresowaPl. Defilad 1WarsawFans of Disney will be delight-ed to know that a concert fea-turing a symphony orchestra,

Warsaw University Choir andlive projections of some ofDisney’s greatest cinematicmoments is set to be per-formed in December.

The concert program willinclude music from such clas-sic animated movies as “Pinoc-chio,” “Bambi,” “The LionKing,” “Cinderella,” and

“Beauty and the Beast.” There will be three per-

formances in total on Decem-ber 9, with a 2 pm matineespecifically geared towardschool children. Tickets arepriced from z∏.40 to z∏.80. ●

For more information log on tokongresowa.pl

Concert

Dream a little dream

Frank Turner and The Sleeping SoulsDecember 14, 8 pmKlub Powi´kszenieul. Nowy Âwiat 27 WarsawEnglish folk/punk singer-song-writer Frank Turner will makehis first appearance in Poland’scapital this month. Since goingsolo in 2005 following the splitof his group Million Dead, MrTurner has slowly but surelybuilt up an international fanbase due to his brilliant lyricsand melodic tunes, which haveseen him likened to other greatsolo artists such as Bob Dylan.

Mr Turner, who is current-ly on tour promoting hisfourth studio album, “Eng-land Keep My Bones,” will be

accompanied on stage by TheSleeping Souls. The group isset to play songs including“Reasons Not To Be anIdiot,” “Long Live the

Queen” and “Peggy Sang theBlues.” Prior to the Warsawgig, Frank Turner will alsoplay at Meskalina bar in Poz-naƒ on December 13. ●

Concert

Folk rock in Warsaw

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Frank Turner

DECEMBER 5-11, 2011 LLAASSTT WWOORRDD www.wbj.pl 23

EExxeeccrraabbllee ggiifftt iiddeeaass ffoorr RReettaaiill MMoonntthhTech Eye

Welcome to the month formerlyknown as December. As mandatedby the United Nations CompulsoryHoliday Upliftment and Festivica-tion Force, you must now refer to itas Retail Month or else be sent toAfghanistan to serve as Santa’sspecial envoy to the Taliban.

Not really. Retail Month is justone of Techeye’s pet names forDecember. Another is Blackmailand Bribery Season, because it’swhen parents extort good behaviorwith threats of Santa’s naughty list,while kids amp up the cuteness,knowing Santa is a total sucker forthat. Wives start dropping casualhints like, “Those diamond ear-rings look lovely, don’t they?Expensive? No more so thandivorce, Darling.”

Men tend to be the least suc-cessful during this season, in ourexperience. So they eventually startblunting the Christmas melancholywith extra helpings of eggnog and,when the big day arrives, hunkerdown in stony silence awaiting theannual “unwrapping of the tie” andthe inevitable “unboxing of thearcane personal-hygiene gadget”which some elderly relative alwaysorders from a suspicious mail-

order company headquartered inCornsnarf or Doilymuck or someother town nobody’s ever heard of.

Or maybe that’s just how it is inour family.

Whatever you call it, traditionobliges Techeye to offer gift sugges-tions during this month. And we’regetting started earlier than usualthis year, because our boss is alwaysponcing on about how Christmasgift guides need to be publishedearly, so that “addle-pated, con-sternated, squinky-faced ‘readers’actually have time to buy some-thing.” He actually uses air quotes

in the middle part.And so, dear “readers,” wel-

come to part one of Techeye’sChristmas gift guide. We’ll startwith an idea for the lucky few fel-lows who won’t be getting paisleyties or elbow-hair trimmers: theMilwaukee Golf Caddy (milwau-keegolfcaddy.com).

Let’s be honest – this is a glori-fied bag rack. It isn’t a great andwonderful gift per se, but it repre-sents a potent union of two manlythings: Harley-Davidson motorcy-cles and golf. The Milwaukee GolfCaddy purportedly installs in under

a minute, has no effect on handlingand is tested at up to 95 mph. Thedownside is that real bikers willprobably beat you up for defacing aHarley; the upside is that you’llhave a nine iron handy for self-defense.

There’s a holiday special onnow: $489 + free shipping (pre-sumably within the US); the regu-lar price is closer to $600.

For the ladies, Techeye has astellar gift suggestion: rings madefrom “space gold” (spacewed-dingrings.com). Sadly we’re nottalking about a precious metal

mined from the moons of Neptuneby intergalactic dwarves. Instead,some enterprising soul paid to havea lump of gold sent up with a sub-orbital research rocket, then used itto make around 100 rings – 50 wed-ding bands and 50 other rings of aless nuptial style.

We’ll admit that Space Ringsare kitschy, but they’re also shiny,expensive and unusual, adjectiveswhich usually impress the women-folk. They were designed by Polishjeweler Apart and cost $12,000.

Last but not least, something forthe kids – Doggie Doo(johnadams.co.uk). Believe it ornot, this scatologically themedgame is on a number of “musthave” toy lists this year, includingThe Guardian’s. The rules are sim-ple: first player to scoop three plas-tic puppy turds wins (in the loosestsense of the word).

Will Doggie Doo fertilize yourkids’ imaginations or just soil theirminds? We figure there’s a 50/50chance either way, and a 100 per-cent chance that you’ll pay £21.99to find out. But pick one up any-way, to support Retail Month andkeep China’s manurefacturers inbusiness. ●

Ever visited Cornsnarf? Let us know: techeye.wbj@gmail.com

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To advertise in WBJ’s classifieds section, contactMs Agnieszka Brejwo, at

(+48) 222-577-526 or abrejwo@wbj.pl

Centre forContemporary Art atUjazdowski Castle ul. Jazdów 2www.csw.art.pl

Czarna Gallery ul. Marsza∏kowska 4www.czarnagaleria.art.pl

Galeria 022, DAP, Lufcik ul. Mazowiecka 11awww.owzpap.pl

Galeria 65 ul. Bema 65www.galeria65.com

Galeria Appendix 2(Praga)ul. Bia∏ostocka 9www.appendix2.com

Galeria Asymetria ul. Nowogrodzka 18awww.asymetria.eu

Galeria Foksal ul. Foksal 1-4www.galeriafoksal.pl

Galeria Milano Rondo Waszyngtona 2A(Praga)www.milano.arts.pl

Galeria Schody ul. Nowy Âwiat 39www.galeriaschody.pl

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

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

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

KatarzynaNapiórkowska Art Galleryul. Âwi´tokrzyska 32, ul. KrakowskiePrzedmieÊcie 42/44and Old Town Square19/21www.napiorkowska.pl

Królikarnia NationalGalleryul. Pu∏awska 113awww.krolikarnia.mnw.art.pl

Le Guern Galleryul. Widok 8, www.leguern.pl

Museum ofIndependenceAleja SolidarnoÊci 62www.muzeumniepodleglosci.art.pl

National Museum inWarsaw Al. Jerozolimskie 3www.mnw.art.pl

Polish National Operaat Teatr WielkiPl. Teatralny 1www.teatrwielki.pl

Pracownia Galeriaul. Emilii Plater 14www.pracowniagaleria.pl

Rempex Art and Auction Houseul. Karowa 31www.rempex.com.pl

Royal CastlePl. Zamkowy 4www.zamek-krolewski.com.pl

Simonis Galleryul. Burakowska 9www.simonisgallery.com

State ArchaeologicalMuseum in Warsawul. D∏uga 52 (Arsena∏) www.pma.pl

State EthnographicMuseumul. Kredytowa 1www.ethnomuseum.website.pl

Historical Museum of Warsaw Old Town Square 28-42www.mhw.pl

History Meeting House of Warsaw ul. Karowa 20www.dsh.waw.pl

Warsaw Philharmonic ul. Jasna 5www.filharmonia.pl

Warsaw RisingMuseum ul. Grzybowska 79www.1944.pl

Wilanów PalaceMuseum and WilanówPoster Museumul. St Kostki Potockiego10/16www.milanow-palac.plwww.postermuseum.pl

Zachęta National ArtGalleryPl. Ma∏achowskiego 3www.zacheta.art.pl

Museums, galleries and venues in Warsaw

The Milwaukee Golf Caddy Doggie Doo