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Polish Market  ::  12/2012

PUBLISHED since 1996 No. 12 (195) 2012  ::


The Xth Gala of the Pearls of the Polish Economy Innovation Industry Infrastructure

Sanjay Samaddar BOD Chairman of ArcelorMittal Poland

MetLife Amplico a leading provider of life insurance, retirement and employee benefit products © PNTS

Consistent in maintaining leading position among the most dynamic and effective companies in Poland. MetLife Amplico companies for the next consecutive time were named “Pearls of the Polish Economy”.



 chemical industry 

From The President’s Press Office # 6


From The Government Information Centre # 7

  Our Guest / PearLs of the Polish economy 

A new natural-resource policy as a remedy for hard times  # 44

Igor Hanas, Energy market in Poland # 46


Mikołaj Budzanowski, Minister of the Treasury. # 8

Pawel Poncyliusz, Member of the Board of Avio Polska Sp. z o.o.; Developing innovation for avaiation industry # 50

Letter from the President of Poland Bronisław Komorowski # 10

Krzysztof Krystowski, President of the Managment Board of the Bumar Group and President of Association of Polish Clusters; New cluster initiatives # 54

  PearLs of the Polish economy 


Pearls of the Polish Economy # 12

Bogdan Sadecki, Infrastructural changes in Poland’s economy in 2012  # 56

 Invest in poland 


Sanjay Samaddar, BOD Chairman of ArcelorMittal Poland; We do not have a remedy, but we have a strategy # 34


Jerzy Bojanowicz; Revival or panting? 

Werner Ballieu, Director of CNH Polska Sp. z o.o.; Opportunities in the Polish agricultural market  # 42

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# 36

Mieczysław T. Starkowski, CE Top 500 report- giants growing in strength #60

Special Economic Zones: Year round-up #64


Prof. Małgorzata Zaleska, a Board member of the National Bank of Poland, Professor at the Department of Banking Warsaw School of Economics, and Vice President of the Committee on Financial Services Polish Academy of Sciences; An (un)banked Pole # 66


Elżbieta Mączyńska, A thought-out future 

# 68


Cultural Monitor 

Maciej Proliński; No crisis for unfaltering art 

# 70 # 72

Maciej Proliński, The Knights of Malta in Warsaw # 74

Socially responsible businesses have been awarded!  # 76


2013 to see 100 New Businesses 

# 80

Maciej Proliński, Export challenges for Poland 

# 82

  food industry 

Janusz Rodziewicz, President of the Association of Polish Butchers and Producers of Processed Meat; Even the best encounter problems # 84

And yet – what a fine time it was! 

# 86

Maciej Bartoń, Organic farming in Poland 

# 88

Publisher: Oficyna Wydawnicza RYNEK POLSKI Sp. z o.o. (RYNEK POLSKI Publishers Co. Ltd.)

Contributors: Magdalena Szwed, Bogdan Sadecki, Agnieszka Turakiewicz

President: Krystyna Woźniak-Trzosek

Columnists: Małgorzata Zaleska, Maja Sujkowska, Chałas & Partners

Vice-Presidents: Błażej Grabowski, Grażyna Jaskuła Address: ul. Elektoralna 13, 00-137 Warsaw, Poland Phone (+48 22) 620 31 42, 652 95 77 Fax (+48 22) 620 31 37 E-mail: Editor-in-Chief: Krystyna Woźniak-Trzosek Deputy Editor-in-Chief: Ewelina Janczylik-Foryś Writers/Editors: Maciej Proliński, Jan Sosna, Sylwia WesołowskaBetkier, Grażyna Śleszyńska, Janusz Korzeń, Jerzy Bojanowicz, Janusz Turakiewicz

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Photographers: Jan Balana, Łukasz Giersz, Rafał Nowak Polish Market Online Editor-in-Chief: Wiktoria Grabowska Sales: Phone (+48 22) 620 38 34, 654 95 77 Natalia Suhoveeva Anna Tywonek Public Relations: Joanna Fijałkowska

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The year 2012 is drawing to a close and it is time to ask the traditional questions: what was the year like and what basis did it create for the future. We repeat this ritual every year and it does not seem we will be able to avoid it this time. Unfortunately, the climate of our political debate is not likely to set us in a joyful mood for Christmas celebrations. Of course, in a situation when the economy is slowing, the question about a threat of recession - a drop in output and GDP - is unavoidable. Prof. Janusz Witkowski, president of the Central Statistical Office (GUS), predicts that Poland’s GDP growth for the full year 2012 will not be lower than 2.5%, the rate assumed in the 2012 budget law. He suggests, however, that the first half of 2013 will be the most difficult period for the Polish economy because it may show negative growth in quarter-on-quarter terms. Researchers of the Institute of Economic Development Warsaw School of Economics have a different view of the future economic situation. Their “economic barometer,” which has functioned since 1995, accurately predicts macroeconomic changes from six to nine months in advance. Since mid-2012 the barometer has indicated a reversal of the present trends in the industrial, construction and retail sectors and in consumer sentiment. This means a revival of economic activity. However, the authors of the barometer write that “it will be difficult for the Polish economy to achieve a year-on-year growth rate higher than 4%. Stagnation trends will dominate. One should take into account that the pace of growth may slow to 2%.” To justify their predictions, they point to the slow growth in investment and the weakening of Poland’s main advantage so far, that is low production costs. The remarks of the GUS president and the researchers of the Warsaw School of Economics as well as those made by the government show not so much a fear of a recession as a fear of a longterm stabilization at a growth rate too low for Poland to be able to catch up with the per-capita GDP levels of the “old EU” countries. Simulations made at the Warsaw School of Economics on the basis of the European Commission’s long-term forecast show that if Poland’s GDP grows at an average annual rate of 4.4%-4.5% we have a chance to catch up with the EU-15 in 19-20 years’ time. If the growth rate is 3.8-3.9% we have a chance to catch up in 23-25 years. And if our economy grows at an average rate of less than 1.8% we will never catch up. This shows what this game is really about. The weakening of Poland’s existing advantages - cheap and well-qualified labour force coupled with a favourable population structure – means we have to activate new advantages. Do we have them? Goldman Sachs experts see our biggest potential in the expansion of exports. Economists of the HSBC bank and the Oxford Economics forecasting centre say the same. According to the report “Global Connections” published by Oxford Economics,

Polish exports will grow by 21% and imports by 15% in three years’ time and Poland will become one of the countries with the fastest growth in foreign trade. Of course, this involves a geographic reorientation, with increased expansion outside the European Union. On these markets, Polish products are increasingly perceived as being as good as products made in Western Europe. It is worth noting that the above forecasts have started to find confirmation in current reports and projections produced by the Export Credit Insurance Corporation (KUKE), a Polish organization supporting exports. KUKE projects a 7% growth in overall exports in 2013, with a 19.4% increase in exports to Central and Eastern European countries and a 16.2% increase in exports to developing countries. Another phenomenon has also started to emerge: for the second time in succession foreign investment of Polish companies has exceeded EUR1 billion. This puts Polish companies in a different position in economic relations with other countries. It is now more often that they are welcomed in these countries as prospective investors, job creators and tax payers. The international image of Polish firms is also changing. After this year’s acquisitions, KGHM Polska Miedź SA is one of the world’s leading silver and copper producers. Another example: 10 years ago the plan to consolidate Poland’s heavy chemical industry failed. Now, after many twists and turns, the paths of Polish chemical companies have converged again and by the end of the year the European Commission may approve a merger leading to the establishment of Europe’s second largest fertilizer producer. There are also similar examples among much smaller firms. In the IT equipment distribution sector, the Warsaw’s based ABC Data company became the market leader in Central and Eastern Europe by expanding into eight countries and preparing to enter more countries. Analysis of data from this year’s Pearls of the Polish Economy ranking, run for the 10th time by “Polish Market” and the Institute of Economics Polish Academy of Sciences, shows that in this difficult period most of the companies included in the league table have either achieved record revenues or significantly improved their efficiency. Interestingly, only 17% of Polish businesses admit they have adopted a strategy whose goal is merely to survive. This is probably why in the past decade of uninterrupted growth we managed to move ahead of Sweden, Belgium, Denmark and Austria in terms of overall GDP. And in terms of per-capita GDP in purchasing power parity, we will most likely move ahead of Hungary, Greece and perhaps also Portugal by 2015. Knowing this, it will be easier for us to look forward with optimism to next year. :: Krystyna Woźniak-Trzosek Editor-in-Chief President Rynek Polski Publishers Co. Ltd.

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Visit to Belgium successes of the Polish economy. As he said, it was thanks to those funds that 250 thousand jobs were created in our country. Bronisław Komorowski expressed his certainty that the signed agreement is a good illustration of what we can and want to achieve in PolishBelgian relations, including contacts with Walloon. The Wallonian Prime Minister and minister-president of the French community in Belgium, Rudy Demotte, said that the agreement will allow cooperation between Poland and Walloon - which is already very good - to continually expand despite an economic recession. The President also visited the local Centre for Microscopy and Molecular Imaging (CMMI). ::

Visit by the French President François Hollande, the President of France, paid an official visit to Poland. “A new beginning associated with the new President of France will mark a renewal of the good, old friendship and cooperation between Poland and France,” said President Bronisław Komorowski. Bronisław Komorowski said, that he is host to the President of France at this difficult moment, during ongoing negotiations regarding the EU budget for 20122020 and discussions on the future shape of the EU system, the fate of the euro zone as well as the fate of Poland’s positions and Polish aspirations within the scope of the EU. François Hollande thanked President Bronisław Komorowski for a wonderful reception in Poland. “All this is testament to the far reaching relations between Poland and France. This is related to history, economy and the positions of our two countries in Europe. This is a strategic partnership, which was entered into some years ago and which should now be re-forged into concrete actions,” said the President of France. Both presidents spoke about Polish-French economic relations. President Komorowski emphasised that Poland is an attractive country for foreign investments. “It is possible and necessary to do quite a lot of work to identify the spheres of particular opportunities, which are associated with the level of French technologies, French capital involvement and the attractiveness of the Polish economy,” he pointed out. “We will also encourage the Polish business circles to trade in as large a scope as possible,” he added. In the opinion of the French President, economic relations between France and Poland are not as developed as the political ones. He estimated, that French companies are able to satisfy the Polish demand in such areas as energy, infrastructure and defence. “We can develop our economic relations,” said François Hollande. “The prospects here are vast. The level of trade between our countries is insufficient. It does not reflect our political, cultural and historic relations.” ::

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Bronisław Komorowski and President of Latvia, Andris Berzins

Polish and Latvian presidents on mutual cooperation Cooperation in the energy and transport sectors, joint actions within the scope of NATO as well as European issues were the subjects of talks between the Polish and Latvian presidents in Riga. Both presidents assessed the growth of economic cooperation and commercial exchanges positively. Bronisław Komorowski and the Latvian President Andris Berzins presided over the plenary talks between the Polish and Latvian delegations. The Polish President praised the hosts for their economic reforms. “It is such an important signal for EU politicians, that in undertaking difficult and sometimes painful decisions it is possible to retain the support of one’s own society and win elections,” he said. The Polish President expressed his contentment with the growth of trade between our countries. “We are looking for more areas which could strengthen the ties between the Latvian and Polish economies. Ambitious infrastructural projects could be just such,” he said. Andris Berzins also emphasised that our economic relations are improving. As he noticed, this year mutual trade increased by 30% in comparison to 2011. The Latvian President also pointed out, that his country pays particular attention to Polish cooperation in the region of energy, transport and defence. He highlighted the significance of regional cooperation between our countries. He mentioned, that there are currently around 30 ongoing projects of this type. An executive protocol to a Polish-Latvian agreement on cultural and educational cooperation for 2013-2016 was signed in the presence of the presidents. After the meeting with President Berzins, Bronisław Komorowski spoke with the Speaker of the Latvian parliament, Solvita Aboltina. ::

Photos: Wojciech Grzędziński

President Bronisław Komorow­ ski together with the First Lady visited Belgium. The Presidential Couple met King Albert II and Queen Paola at the Royal Laeken palace in Brussels. In Charleroi, Bronisław Komorowski took part in the agreement signing ceremony between Łódź Technopark and Biopark Charleroi Brussels South ULB. President Komorowski said: “Due to cohesion funds, our cities - Łódź and Charleroi - have created centres which have the potential to become not only centres for new ideas and new products but the centres for new EU as well.” The President also said that the EUR 50 billion, which Poland received as part of the current EU budget “in conjunction with hard work, creativity and courage” translated into real

Photos: Maciej Śmiarowski/KPRM

Asia-Europe Summit Participants

Visit by the Moldovan Prime Minister Prime Minister Donald Tusk held talks with the head of the Moldovan government Vladimir Filat on European Union integration and energy issues. The politicians discussed an association agreement between the European Union and Moldova as well as integration within the scope of the Eastern Partnership. Energy related issues were also discussed. During the official visit to Poland the Moldovan Prime Minister was accompanied by the Deputy Prime Minister, Foreign Affairs and European Integration Minister Iurie Leancă as well as Re-Integration Deputy Prime Minister Eugen.::

EUR 6 million to support democracies neighbouring the EU On Monday, the European Commission decided to earmark EUR 6 million to initiate the European Democracy Fund. This is a Polish initiative, approved during our presidency of the EU. The main objective of the Fund will be to support democratic processes in authoritarian countries as well as those currently undergoing a systemic transition. Its activities will be addressed primarily to leading pro-democracy organisations, independent media and civil organisations working for political pluralism and democratic changes. The Fund will be financed by member state contributions and the EU budget. It will consist of limited management structures and procedures facilitating rapid reactions to the needs of budding democracies. The idea for setting up the Fund was presented in January 2011 by Foreign Minister Radosław Sikorski as a reaction to the events in Belarus and the start of the Arab Spring. ::

Prime Minister Donald Tusk at the EU Summit in Brussels

Prime Minister at the Asia-Europe ASEM summit At the Asia-Europe asem world leaders discussed, global financial challenges, stimulating the economy as well as facilitating trade and investment. Poland was represented by Prime Minister Donald Tusk. The Asia-Europe ASEM summit was an opportunity to present the Polish economic success and entice foreign investors. During the course of the two days, our delegation held bilateral talks with numerous Asian partners. During these meetings it was possible to emphasise Polish interest in this region of the world. Asian customs dictate that such meetings are significant for the success of projects, particularly in relation do government contracts. Within the scope of bilateral meetings, the head of the Polish government spoke to the Prime Ministers of Japan, Korea, Thailand and others. Forum members represents circa 59% of the world population, more than half of the world GDP and in excess of 60% of global trade. 21 Prime Ministers and 14 country leaders participated in the ASEM summit. Representatives of the 27 EU member states, European Commission, China, Japan, India, Russia, Australia, Pakistan, New Zealand, Korea and Mongolia, to name but a few, were present. At the plenary session, Prime Minister Donald Tusk presented the Polish evaluation of the European economic situation. ::

The European Union summit in Brussels without cuts in agriculture and cohesion policy Any forthcoming cuts in the EU budget will not entail the cohesion policy or agricultural policy. This fact was announced by Donald Tusk after the EU summit in Brussels. The next summit is scheduled for January 2013. “The meeting’s participants declared, that a convergence of positions was reached and there is scope for achieving a compromise, but it still requires a lot of work,” the Prime Minister summarised the results of November’s summit. He added, that when it came to some issues, willingness to

cooperate was more pronounced than could have been expected. Donald Tusk said that no one was interested in the talks coming to nothing: “Herman Van Rompuy is taking into account our proposals. The differences between our proposals are not insurmountable.” The next EU summit for the 201220 budget will take place in January. Before that, the European Council Pesident, Herman Van Rompuy, will present a new draft for the EU budget.::

Prime Minister Tusk congratulates Obama “We are bound by friendship and alliance. The forthcoming four years at the White House will be an opportunity for an even more intense dialogue between our countries,” wrote Donald Tusk in the congratulatory message to Barack Obama, who won the presidential election in the United States. The Prime Minister emphasised that he is happy with the close relations between Poland and the USA. “We are political, military and economic partners, and our relations are developing dynamically,” Donald Tusk was referring to the president’s visit to Poland of last year. He also mentioned the importance of social confidence in these economically difficult times. “I do trust that the second term of Your Presidency will allow for the continuation of your chosen path,” wrote Donald Tusk, ending with: “Once again, please accept my sincere congratulations and best wishes of success in fulfilling the mission entrusted to the President of the United States of America.”:: 12 /2012  ::  polish market  ::  7

Our Guest

New development policy for the chemical sector Remarks by Mikołaj Budzanowski, Minister of the Treasury.

From the perspective of the Ministry of the Treasury and the government as a whole, 2012 is a crucial year for the Polish chemical sector in terms of its perception against the background of other sectors of the Polish economy. There are two reasons behind this crucial change. First, what happened on the American market several years ago and is associated with a rise in the output of natural gas – the shale gas revolution, which started in the United States and is now gradually spreading to Europe, especially Poland – offers a big opportunity for the whole chemical sector in our country. And the second reason behind the changed perception of the chemical sector has been the unexpected interest in acquisitions on the part of companies controlled by the Ministry of the Treasury. This unexpectedly high interest encouraged us to consider whether it was better not to sell the chemical sector controlled by the Treasury and instead think about new development projects and about the future. The meeting we held in June with those interested in the acquisition of chemical companies gave us a huge boost and new inspiration to develop the sector. As a result, the government has prepared two instruments which will provide the whole chemical sector with an enormous potential for expansion. The first one will be the right and reasonable raw material policy. The other will be a new financing policy. The raw material policy is first of all associated with a rise in the volume of natural gas extracted in Poland. It is a very ambitious investment programme, the aim of which is to double Poland’s indigenous gas production. The 4.5 million cubic metres of gas now extracted in Poland accounts for less than 30% of what the market needs. The remaining 70% is imported. We definitely want to change this proportion and raise the share of indigenous gas. The gas will be supplied first of all to the chemical industry, which is now its largest consumer. Our goal is very specific and associated with three companies that we control: PGNiG, Orlen and Lotos. The goal is to

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make an intensive investment of billions of zlotys in gas exploration and extraction, and to better exploit the extraction licences that these companies already hold, but do not yet have an idea how to manage them. I will certainly be encouraging every company which has excessive liquidity to take an interest in the potential to get involved in gas extraction in Poland by providing funding for the projects. There are now a few dozen licences waiting for a financial injection to extract gas in our country. I mean not only unconventional gas but also conventional one because the latter is relatively more abundant in our country, with the largest number of identified deposits, which are simply waiting for a new investor to start extraction in the near future – in 2014-2015. Another challenge that the gas and fuel sector is facing is unconventional gas in two forms – not only shale gas, which is often talked about, but also tight gas, which is another source of this raw material. This represents an enormous extraction potential, as yet untapped in Poland, and a great chance for the whole chemical sector because it builds its value and competitiveness on the

European market. The raw material policy and increased extraction is of key importance for the government now. This is associated with a change in the price of Russian gas imported to Poland. I hope the change we have managed to achieve, that is an over 3.5% reduction in the price of gas that will be delivered, is only the beginning of further price cuts. What we have achieved in the new gas supply agreement is a change in the price formula. This means that in the medium term of two or three years the gas price will cease to be dependent on the price of oil barrel, as was the case in the past years, but on prices of gas offered on Western European exchanges, like for example the Dutch, German and British exchange. This also offers a chance for gas reductions in the second half of 2013. Another important issue is the Polish Investment programme announced by Prime Minister Donald Tusk in October. The programme offers a unique chance for developing a new financial mechanism supporting profitable projects. The main criterion will be commercial profit, but we will be very carefully analysing the projects able to make a real socio-economic contribution to GDP. Both factors will determine the involvement of these financial instruments in specific investment projects. The project we started to talk about after an agreement had been signed between the Lotos refinery in Gdańsk and the Polish chemical sector – Azoty Tarnów Group – spurred this way of thinking. We are speaking about a new way of project funding worth several billion zlotys. First, Bank Gospodarstwa Krajowego will gain the potential to grant long-term loans for at least 10-15 years on competitive terms thanks to a capital injection from assets managed by the government. In addition, we have a new instrument in the form of an investment company, which will be contributing capital for profitable projects. The two elements will be supporting the implementation of new investment projects. The criterions will be profitability and the need for the industrial infrastructure to be built in Poland. We want this programme, worth at least PLN40 billion, to be carried out in Poland in the next three years. ::

To our partners we extend the warmest wishes for a Happy and Joyous Christmas and the best of luck and success in the New Year 2013, with appreciation for our joint work sofar and hope for a fruitful continuation of our business relations.

The Management Board and sta at Operator Logistyczny Paliw Płynnych Sp. z o.o.

Pearls of the Polish Economy

Letter from the President of Poland to Laureates, Guests and Organizers of the Anniversary Gala of the Pearls of the Polish Economy, November 16, 2012 Dear Laureates! Ladies and Gentlemen! I am sending warm greetings to all participants gathered at the Royal Castle in Warsaw for the Pearls of the Polish Economy Gala. The anniversary 10th edition of this ranking, organized annually by the editorial board of the “Polish Market” magazine, shows that it has become a fixture in Poland’s economic life. The prestigious Pearl of the Polish Economy titles reflect very concrete achievements. They are granted to single out businesses, which have reported high growth and can be counted among the best Polish firms. What is more, the ranking makes it possible to diagnose the condition of our economy and identify current economic trends. I wish to sincerely congratulate the winners of the prestigious titles. You have a good reason to be proud. It is thanks to the Pearls, apart from other factors, that Poland is one of the fastest developing European countries. I also offer my warm congratulations to the winners of the Honorary Pearl title – outstanding personalities who promote our country’s favourable image in Europe and across the world through their achievements in the sphere of economy, science and culture, and by furthering patriotic and social values. Thank you for strengthening the reputation of Poles as a nation able to wisely, decently and excellently benefit from the great value which is freedom. The results achieved by Polish businesses are of special importance at a time of another wave of the global crisis, turbulence in the euro area and an economic slowdown, which has also affected our country. I am convinced that the Polish strategy for coping in these difficult circumstances will prove its worth again. It is based on the assumption that the task of the state authorities is to maintain macroeconomic equilibrium and ensure the efficient functioning of the financial system, but not to impose on business organizations the decisions which they should be taking independently. Your knowledge determines how money, means of production and human

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labour and skills are managed. Your experience gained from years of business activity is becoming an increasing strong asset of Poland, which is enhancing its economic competitiveness. A modern economic patriotism includes care for brand Poland. Our economy needs our own brand-name products to be able to successfully compete on the European and global market. Building a positive image for Poland is a very important task for us all. Therefore, it is a good

reason for satisfaction that many businesses are working out top-standard solutions in many sectors of our market. I wish you success in your cooperation with all your partners and in taking the right decisions which will be building the success of your firms and the strength of the Polish economy. Bronisław Komorowski

In 2012 the Katowice Special Economic Zone was placed by the Business Financial Times FDI best economic zone ranking in second place in Europe and eleventh worldwide. Such success would not have been possible without the commitment and consistency of investors, who continue to implement investment projects within our zone, now reaching a value of EUR 5 billion. In employing 50 thousand staff, they efficiently fuel the economic growth and development of our region.

Best wishes of merry and happy Christmas, filled with joy and hope, future successes, patience and perseverance in striving to achieve your goals, as well as continued mutually beneficial cooperation in the forthcoming year. On behalf of the Katowice SEZ Management Board and staff, Piotr Wojaczek

Pearls of the Polish Economy

On 16 November, the Ballroom of the Royal Castle in Warsaw hosted the 10th-Anniversary edition of “The Pearls of the Polish Economy” Gala, organised by the publisher of “Polish Market,” a monthly for English-speaking readers.

Deputy Prime Minister and Minister of the Economy, Waldemar Pawlak, and the President of the Polish Academy of Sciences, Professor Michał Kleiber were the patrons of the Gala. This year’s Gala marked the anniversary, the 10th edition of this event, organised by the publisher of “Polish Market.” Every year, during the ceremony, special statuettes are awarded to the best businesses selected in a ranking by the Institute of Economic Sciences of the Polish Academy of Sciences.

The Pearls of the Polish Economy have the glare of optimism

says Krystyna Woźniak-Trzosek, the Publisher and Editor-in-chief of “Polish Market.”

This is already the tenth time that I have the honour to welcome all guests to our

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Pearls Gala, and so I greet the Laureates of the “Pearls of the Polish Economy” ranking. For the second time, I also greet the Laureates of the “Pearls of Innovation”, and, for the seventh time, I do the same for the Laureates of the “Honorary Pearls” - awards that have been granted to distinguished individuals from the economic, scientific and cultural circles who have made valued achievements in the field of propagating patriotic and civic values. We have so far granted 45 Honorary Peals, but unfortunately three of the Laureates are not among us any more – the former President of the Republic of Poland, Ryszard Kaczorowski, Colonel Jerzy Woźniak and Mr Sławomir Skrzypek, the former President of the National Bank of Poland. When 10 years ago for the first time, together with the Institute of Economics, and during the Economic Forum in Krynica, we jointly announced the results of our ranking, we viewed the future of Poland with hope and optimism. Today the glare of the Pearls of the Polish Economy results in that this optimism remains with us, although

Pearls of the Polish Economy

for the past four years, our economic realities have been grossly overshadowed by the global economic crisis affecting the world. This crisis is a struggle for Europe in the first place, and especially the European Union which still aspires to the position of a global leader. In this regard, numerous sessions and debates are being held under the motto of “what is the future of the European ­Union?”, and I have been wondering how it is so that Europe, this potent reservoir of capital, technologies and intellectual prowess, keeps on having this fear of an uncertain future. Maybe what is needed is a gigantic mental upheaval. Maybe, as maintained by the Swiss economist, Paul Dembiński, what is needed is an intrinsically new model of financing, because contemporary society is infested with solitude, longevity and related ailments; with existential fears and stress, with educated, yet unemployed youth. Maybe he is right? Maybe the Nobel Prize that was granted to the European ­Union should remind it of the values which are its foundations? Speaking about Europe, let us look at how the same words denote completely different economic realities. After all, the world “crisis” for a Pole means something totally different than it does for a Greek or a Spaniard. Maybe it is with the awareness of these differences that debates about the European crisis, the EU budget and the EU financing in the coming years should be held, because if

frugality and responsibility are to be the recipe for an economic and financial recuperation of the European Union, it should be remembered that since the year 2004, none of the Member States accepted then to the European Union has ever blackmailed Brussels with a budget catastrophe. If the recipe is supposed to be based on economic growth, maybe we should more frequently ask the question of where investments should be made in this growth. Should this be in the “old” Europe, which is not even going to notice an added kilometre of a motorway, or in the “new” one, where 7-8 out of each 10 invested euros will return to the net-payer state? Sometimes finding a solution to complex issues is helped by asking the simplest questions. I leave you with this thought, being deeply convinced that the success of the Polish economy is mainly being achieved by Polish businessmen and women, that is by you, who are today with us, as well as by representatives of the Polish science and culture, people who care for Poland’s historic continuity and give us examples of being responsible. They create the future of our state. I know that we need a strong and prudent state, one not submerged in internal quarrels, we need a state that takes care of its entrepreneurs, that does not intervene too much with business, but which creates decent conditions for development. We need a state that would be both the guardian of economic liberties and a protector of our intellectual heritage.

On the occasion of this 10th anniversary, let me express my gratitude to all those who have helped us in creating the Pearls of the Polish Economy ranking. I give thanks to Professor Leszek Jasiński, the Director of the Institute of Economics of the Polish Academy of Sciences, and the economic experts from this Institute - Professor Zbigniew Hockuba and Professor Jan Macieja, with whom we launched this venture 10 years ago. I also give thanks to our Honorary Patrons, I thank the Members of the Honorary Pearls Chapter, and I thank Professor Leszek Rafalski, the Chairman of the Main Council of the Research Institutes, for his participation in the work of the jury of the Progress 2012 contest. I also wish to thank our Partners, Sponsors, Media Patrons and I extend the most sincere congratulations to all the Laureates. I wish you perseverance, courage in decision making, and above all, faith in the meaning of what you are doing – faith in the meaning of your work. I learnt this faith some time ago, keeping in mind the words of Cyprian Kamil Norwid:

“For light is not meant to stand

under a bushel,

Nor is the salt of the earth

for seasoning dishes;

For beauty tempts people into work, And work – to earn salvation.” 12 /2012  ::  polish market  ::  13

Pearls of the Polish Economy

The Pearls Ranking is a successful marriage of economy and science

says Professor Michał Kleiber, President of the Polish Academy of Sciences.

There are many reasons why I am satisfied that I can appear in front of you today and share a few words with you as the patron of the “Pearls of the Polish Economy” ranking – indeed, the 10th edition of this ranking, as well as the 7th edition of the “Honorary Pearls”, both of which perfectly complement the economic dimension of this Gala. My satisfaction is brought about by several reasons. One of these is the fact that the annual Gala concludes another year of activities of the excellent “Polish Market” monthly, which has entered its second 15 years of existence. This is a journal which, in my opinion, plays a significant role in our economic life and in the promotion of our economy abroad. What is impressive in everyone’s eyes, is its reliability, attractiveness, thoughtful conclusions and magnificent layout. Another reason is that, as the patron of this ranking, I continuously witness a successful marriage of economy and science here. I do not only mean the formal aspect – the fact that we are discussing economic issues, and that the ranking has been designed by a scientific institute. What is important is that scientific tools have been applied to this ranking. This is going to be very important as such scientific tools allow us to correctly position our business establishments, expose their achievements and honour the best of them. The methodology applied here is characterised by the consistency of the criteria, their precision

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and functionality. In this ranking, we consider not only the most basic criteria, such as the company’s income and size, but also those which are most appropriate for an appraisal of the quality of management, the effectiveness of performance, dynamics and financial liquidity. I must say that my satisfaction from being here does not primarily stem from being the patron of this venture, but even more so, as I am a representative of the great corporate body of the most distinguished Polish scientists, from the conviction that it is precisely science which provides the tools, defines the criteria and creates the methods of measurement which make systematisation of this world easier, more convincing and more objective. Thus, in a way, it is natural that - at this Gala - the ”Pearls of the Polish Economy” are being complemented by the granting of the “Honorary Pearls”. I daresay that we have found a common denominator for the economic awards and for these Honorary Pearls. It consists in our belief that what deserves to be awarded are talent, imaginativeness, passionate attitudes and relentless hard work.

Despite the crisis Polish businesses are improving their financial results

says Grażyna Henclewska, Undersecretary of State in the Ministry of Economy.

Today’s celebration has a special significance, as it is for the tenth time that we are honouring businesses. Today, we are saying that businesses form the solid foundations of the Polish economy. Establishments supported by people who are creative, enterprising, educated and – above all – who peer into the future without any hindering bias. Despite the adverse macroeconomic realities of the past few years, the Polish economy has proven its exceptional resistance and, at the same time, its significant capabilities, which allowed it to maintain economic growth each consecutive year. This relatively high increase of the GDP has resulted from many factors – internal demand, increased investment outlays and growth in exports. Yet the successive years of GDP growth could not have been possible without the effort of entrepreneurs. Polish companies have shown themselves to be the ones who, despite the high degree of uncertainty brought about by the external conditions of conducting

business, such as – to name one – the deteriorating fiscal problems of the eurozone, have been capable of achieving positive results, have increased sales and have quite often recorded results better than in the previous years. It is worth stressing that our companies do not limit themselves to activities on the domestic market, but bravely and dynamically develop their operations on foreign markets as well. These activities abroad not only build up the brand Poland, but also (which is important) enhance the economic stability of our economy, which, as a result of this, copes better with the whirlwind of the global crisis. In this context, what is very important is the laying of good conditions for conducting business activities, as well as providing support to Polish exporters – both the companies launching or continuing their investments. Accordingly, in the past few years, a number of reforms have been implemented, in particular under entrepreneurship-promotion packages. Let me mention the two packages of deregulatory measures, while the work on the third of these is in progress in the Parliament, after it had been adopted by the government. The Ministry of Economy is preparing yet another one. Support for business is not limited to deregulatory measures. An increasing importance is being attached to smart, sustainable and inclusive growth. Such a growth requires the creation of a network of interrelated connections among the economic, environmental and social policies. Business people are fully aware that long-term stable growth requires a balance in the economic surroundings. This is a challenge, but also a need to deepen the effective cooperation

Pearls of the Polish Economy

among the administration, business and civic society institutions. It should also be stressed that it is only this joint effort and the activities of all parties to the dialogue that will guarantee that the suggested changes and actions are going to meet social expectations. On behalf of the Deputy Prime Minister and the Minister of Economy, I wish to assure you that we do appreciate your efforts in the development of the economy. Therefore, I would like to extend my sincere congratulations to all the laureates of this year’s Pearls and to wish them further success.

Prof. Ksa­wery Piwocki, Prof. Andrzej Rottermund, Adam Szejnfeld, Janusz Steinhoff, Prof. Andrzej Wiszniewski and Krystyna Woźniak-Trzosek. This unique award is presented to eminent individuals and institutions whose professional achievements, experience, prestige, commitment to ethics, personal qualities and intact reputation make them worthy of being true ambassadors for the noblest Polish values. The laureates receive their distinctions in the following categories: economy, science, culture, the fostering of Polish traditions and national heritage and the promotion of civic values.

Congratulations to the Pearls of the Polish Economy

expressed by Eugeniusz Grzeszczak, deputy-Speaker of the Parliament

The 10th anniversary edition of the “Pearls of the Polish Economy” Gala is an event of great importance. We should, and must, congratulate all those who have been awarded so far in this ranking. What we also can and have to do is congratulate the originators of this project. Such was the precision of the criteria developed by them to “fish for” the Pearls that the President of the Polish Academy of Sciences, the Deputy Prime Minister and the Minister of Economy all hold patronage over each year’s edition of the Pearls of the Polish Economy. These congratulations are more so because the “Polish Market” monthly does a great job of not only spotting these Pearls, but also promoting them worldwide. The Honorary Pearls are also truly valuable – and it has been seven years since the distinguished Chapter started awarding the best of the best. As we all know, these Pearls have been awarded to people of excellence and authority. This year’s edition too welcomes many highly respectable and acclaimed individuals, and even though they work in so many different fields, they have a common ambition, which is to be the advocates of Poland and Polishness. On behalf of the Polish parliament, my congratulations go to all the Laureates. In 2012, the “top three” Grand Pearls of the Polish Economy were KGHM Polska Miedź S.A., Synthos S.A. GK and LPP S.A. G K.

The Large Pearls went to Avio Polska Sp. z o.o., Faurecia Gorzów Sp. z o.o. and Stalprofil S.A. In the financial sector (banking and insurance services), the podium was taken by BZ WBKAviva TUO S.A., Compensa TUnŻ S.A. Vienna Insurance Group and Provident Polska S.A. The leaders in infrastructure included Polska Grupa Energetyczna S.A. GK, GDF SUEZ Energia Polska S.A., and Polkomtel S.A. KGHM Polska Miedź S.A., Synthos S.A. GK and LPP S.A. G K. made it to the forefront of the manufacturing and service companies sector. During the Gala, the Pearls of Innovation, or Progress 2012, were also awarded. Although this was not the premiere of this contest, the laureates received their awards for the first time at the Pearls of the Polish Economy Gala. The jury consisted of Krystyna WoźniakTrzosek, the “Polish Market” Editor-in-Chief, and Professor Leszek Rafalski, the Chairman of the Main Council of the Research Institutes They selected companies which lead in innovation and continue to introduce novel solutions to their businesses. This year, the originators of interesting and innovative projects included SAS Institute Polska, Canal+ Cyfrowy, Trax Elektronik, PKP Intercity and PKO Bank Polski S.A. The 2012 Gala was also the 7th edition of this event featuring the Honorary Pearls, a distinction conferred by a special Jury with Prof. Jerzy Buzek, Tadeusz Donocik, Grażyna Jaskuła, Prof. Janusz Lipkowski,

As the Gala traditionally features concerts by great artistes, this year was no exception, and the guests could listen to Andrzej CzajkowskiŁadysz, the Poznań Boys’ Choir conducted by Jacek Sykulski and the winners of the Festival of Children and Young People with Special Needs in Ciechocinek, an event under the patronage of “Polish Market.” ::

Grand Pearls of the Polish Economy KGHM Polska Miedź S.A., Synthos S.A. GK LPP S.A. G K.

Large Pearls of the Polish Economy Avio Polska Sp. z o.o., Faurecia Gorzów Sp. z o.o. Stalprofil S.A.

Financial sector (banking and insurance services), BZ WBK-Aviva TUO S.A., Compensa TUnŻ S.A.Vienna Insurance Group Provident Polska S.A.

Infrastructure sector Polska Grupa Energetyczna S.A. GK, GDF SUEZ Energia Polska S.A., Polkomtel S.A.

Manufacturing and service companies sector KGHM Polska Miedź S.A., Synthos S.A. GK LPP S.A. G K.

Pearls of Innovation or Progress 2012 SAS Institute Polska, Canal+ Cyfrowy, Trax Elektronik, PKP Intercity PKO Bank Polski S.A. 12 /2012  ::  polish market  ::  15

Pearls of the Polish Economy


The Laureates of the Grand Pearls of the Polish Economy. From the left: Zbigniew Lange (Synthos S.A.) and Dariusz Wyborski (KGHM Polska Miedź S.A.)

The Laureates of the Grand Pearls of the Polish Economy


The Laureates of the Large Pearls of the Polish Economy. From the left: Henryk Orczykowski (Stalprofil SA), Małgorzata Zięba (Faurecia

Krystyna Woźniak-Trzosek (“Polish Market”) handing over the

Gorzów Sp. z o.o.) and Paweł Poncyljusz (Avio Polska Sp. z o. o.)

Large Pearl of the Polish Economy to Paweł Poncyljusz

The Laureates of the Large Pearls of the Polish Economy

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Pearls of the Polish Economy Paweł Poncyljusz (Avio Polska sp. z o.o.)

Henryk Orczykowski

Henryk Orczykowski, Vice-President of the Board & Chief Development Officer of Stalprofil SA

(Stalprofil SA)

We are approaching the end of this year, which in my view has been a difficult one. However, we are not pessimistic - we look to the future with cautious optimism. Of course, there are difficulties, the crisis hit us. But the problems of the Polish construction market, which is one third of the steel market in Poland, have in fact not affected us significantly. Any recognition of and award to our company is a great honour for us, especially when it is based on objective criteria.

Avio Polska Sp. z o.o. Paweł Poncyliusz I’m also pleased and moved that Avio Polska has been honoured with this prestigious Pearl of the Polish Economy award, once again. It is an honour for every company. We are appreciated for our efforts, and for our work in the field of the economy. I would like to wish “Polish Market” that this initiative continues to develop, and that every year these awards serve as a crown for ventures and as an encouragement to further efforts. Konrad Pokutycki (BSH) and Prof. Leszek Jasiński presenting Małgorzata Kozieł (PGE) with the Industry Pearl

The Laureates of the Industry Pearls: finance, infrastructure and manufacturing-service sectors

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Pearls of the Polish Economy


The Laureates of the Pearls of Innovation Progress 2012

The Laureates of Progress 2012. From the left: Marcin Celejewski (PKP Intercity) and Jarosław Wolbromski (PKO BP)

Alicja Wiecka (SAS Institute Polska) receiving the award from

Prof. Leszek Rafalski presenting Beata Mońka (Canal+

Krystyna Woźniak-Trzosek and Prof. Leszek Rafalski

Cyfrowy) with the Progress 2012 statuette

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Pearls of the Polish Economy Alicja Wiecka, Managing Director of SAS Institute Poland “The Pearl of Innovation recognises SAS’s achievements on the Polish market, and simultaneously obliges us to pursue even more effective operations in the development of innovative solutions and in aiding our clients’ innovativeness. We have been on the market for 20 years, and from the very beginning we have highlighted the importance of supplying our clients with solutions providing specific business value and competitive advantage. We pride ourselves on our company’s contribution to the transformation of the Polish economy and the development of a modern public administration. Owing to the unique abilities of our experts and the highest standards in our implemented IT technologies, SAS Poland is consequently setting innovative trends and directions.”

Beata Mońka, President of the Board & CEO of CANAL+ Cyfrowy Alicja Wiecka (SAS Institute)

For us, the ending year has been a very dynamic, challenging period, in which we operated intensively on a highly-competitive market. It was a bit like driving a Formula 1 car – “pedal to the metal”. The “Pearl” given to us is a very prestigious and valuable award, which we are proud of as a team. As a company, we play a significant role in the economy of Poland, but the award for innovation in the market for media and technology, which is a highly competitive one, is something that makes us absolutely distinctive. Therefore, I thank all the members of our team who contributed to this success, and, in this age of intense competition, took the time to think about the future, and about the introduction of innovative technologies. This, as it turns out, was recognised by the honourable jury.

Beata Mońka (Canal+ Cyfrowy) A performance by

A concert by the Poznań Boys’ Choir

Angela Wawrzyk, the Laureate of the Song Festival of Young Disabled People The Pearl of Innovation went to Mariusz Tomecki (Trax Electronic) - in the photo with his accompanying person

A performance by Katarzyna Rudnik, the Laureate of the Song

A performance by Aleksander

Festival of Young Disabled People


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Honorary Pearls

:: Science Prof. Marek Krawczyk, transplant surgeon, Rector of the Medical University of Warsaw; Prof. Andrzej Buko, Director of the Institute of Archaeology and Ethnology of the Polish Academy of Sciences.

:: Culture Music: Jacek Sykulski and the Poznań Boys’ Choir; Maryla Rodowicz, a legend and the First Lady of the Polish music scene; and Bernard Ładysz, a star of the world’s greatest opera stages Theatre: The Polish Television Theatre a phenomenon on the global scale, Jerzy Stuhr, – one of the most popular and acclaimed Polish actors of theatre and television, a director, professor and a long-standing rector of The Ludwik Solski State Drama School in Kraków

The year 2012 This year, the Special Honorary Pearl went to an otolaryngological surgeon and an otorhinolaryngology, audiology and phoniatrics expert of world renown – Prof. Henryk Skarżyński.

:: Promotion of Applied Art Adam Spała, the owner and President of AS Ćmielów Porcelain Manufactory; Prof. Czesława Frejlich – the creator of “2+3D,” a Polish-wide quarterly magazine on the art of design

:: Promotion of Civic Values

The laureates in the remaining categories:

Bożena Kazanowska, the co-founder of the Jasne Strony Foundation

:: Economy

:: Fostering of Patriotic Values

Paweł Olechnowicz – one of the most illustrious managers on the contemporary market; Prof. Zbigniew Hockuba.

Franciszek Tomasz Ludwin, a veteran of the Home Army, pseudonym “A. HART”, a representative of the Cursed Soldiers.  ::

The Jury of the Honorary Pearls Prof. Jerzy Buzek former Prime Minister and former President of the European Parliament Tadeusz Donocik President of the Chamber of Commerce and Industry in Katowice Grażyna Jaskuła Vice-President of Oficyna Wydawnicza Rynek Polski

Prof. Janusz Lipkowski Chairman of the Jury Prof. Ksawery Piwocki former Rector of the Academy of Fine Arts in Warsaw

Janusz Steinhoff, PhD former deputy Prime Minister and Minister of the Economy;

Prof. Andrzej Rottermund Director of the Royal Castle in Warsaw

Prof. Andrzej Wiszniewski former President of the State Committee for Scientific Research, former Minister of Science and former Rector of the Wrocław University of Technology

Adam Szejnfeld Chairman of the Sejm Treasury Committee

Krystyna Woźniak-Trzosek President of Oficyna Wydawnicza Rynek Polski

Prof. Andrzej Wiszniewski, former President of the State Committee for Scientific Research, former Minister of Science and former Rector of the Wrocław University of Technology I want to offer my sincere congratulations and my best wishes to all the laureates. It is a wonderful distinction and there is a good reason why its final event is held at the Royal Castle. Those who will be given today the Honorary Pearl statuettes make up a truly royal team of Poland’s economy and social

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life. I will offer, although from afar, my congratulatory toast for your success. I also wish to express my great respect for the “Polish Market” editorial staff, who have so consistently promoted Poland’s elites. I feel that creating the tradition to award Honorary Pearls to the most outstanding people is a special and

praiseworthy proof of that. I have no doubt that the tradition of the Honorary Pearls Gala will become well established in our country. This is what I wish the editorial staff. I place the wishes in the hands of Ms Krystyna Woźniak-Trzosek, who leads the editorial staff and is the originator and initiator of the awards.

Honorary Pearls Prof. Zbigniew Hockuba received the Honorary Pearl in the category of the Economy

Prof. Zbigniew Hockuba

Krystyna Woźniak-Trzosek handing over the Honorary Pearl in the Science category to Prof. Marek Krawczyk (the Medical University of Warsaw)

Prof. Marek Krawczyk, MD, PhD, Rector of the Medical University of Warsaw In order to assess the passing year, one has to answer an important question: Whether the university has changed for the better, both regarding improvements to the teaching and scientific base, as well as, and most importantly, whether we have managed to face the challenges of teaching new generations of health-care personnel, and whether our scientific personnel have successfully contributed to the dynamic development of the medical sciences. The answer to all these questions is... yes, there are many things we can be proud of. We have commissioned a modern Library and Information Centre with more than 120 rooms, and we are about to finish the construction of the Preclinical Examination Centre, which will also feature aresearch infrastructure supporting the operation of the biomedical research centre in the Ochota Campus. In January, we laid the cornerstone under the construction of the Paediatrics Hospital, with more than 500 beds, and, as we speak, the Sports and Rehabilitation Centre is being erected. The fact of new students starting their education, without a postgraduate internship, will be a completely new challenge for us, including the financial aspect, due to which, we have had to amend the curriculum. Our scientists can boast of more and more approved scientific projects. The academics in our Alma Mater are among the best Polish scientists, and it is reflected by the Prime Minister’s

scientific prize being awarded to Prof. Jakub Gołąb for academic achievements and to Dominika Nowis, PhD for the best habilitation (postdoctoral) dissertation. It is hard to count all the advantages. Next year, we will continue what we started. The construction of the Preclinical Examination Centre will be completed by the end of the year, and the facility is planned for opening in the middle of the next. Our further challenges will be connected with the necessity to adjust the coming generations of students to the following reforms stemming from the abolition of the postgraduate internship. The Honorary Pearl is not the only prize awarded to me. In 2011, I was honoured twice by different bodies to be the Person of the Year for my achievements in the field of medicine. I received these distinctions not as Marek Krawczyk, but as the Medical University of Warsaw. This university is the mother of my every success and distinction, and the academic community, honouring my work, appointed me to serve as the University Rector once more in the years 2012-2016.


Prof. Marek Krawczyk expressing his words of gratitude

Prof. Marek Krawczyk (the Medical University of Warsaw)

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Honorary Pearls

Prof. Andrzej Buko (Director of the Institute of Archaeology and Ethnology of the Polish Academy of Sciences) receiving the Honorary Pearl from Prof. Janusz Lipkowski

Prof. Andrzej Buko, Director of the Institute of Archaeology and Ethnology of the Polish Academy of Sciences, Full Professor at the University of Warsaw, expert on Polish and European Mediaeval Archaeology “As a scientist, I deal with the history of Central and Eastern Europe. Notably, our major archaeological discoveries related to Mediaeval Poland, including scientific papers, have contributed to European and global

research. Having not anticipated this prize, I am very honoured. Being surprised like this is always nice. I see the prize essentially as a major recognition of a broad research team, without which I wouldn’t be here tonight.” Prof. Henryk Skarżyński congratulating Jacek Sykulski

Jacek Sykulski (Director of the Poznań Boys’ Choir)

Krystyna Woźniak-Trzosek awarding the Honorary Pearl in the category of Culture to Jacek Sykulski (Director of the Poznań Boys’ Choir)

Jacek Sykulski and the Poznań Boys’ Choir – a composer, conductor and choirmaster, with his choir embedded in the rich tradition of boys’ choral singing in the Wielkopolska Region “Polish artists are a real treasure of ours, which we ourselves must foster and appreciate. And these simply must be promoted on the international stage. Wherever we travel and perform our concerts, from Bolivia to Russia, we do our best to be the so-called “Ambassadors for Poland”, to spread the best qualities of the country and fulfil our responsibility for Polish culture. Here music plays the role of a very universal language that, on the one hand, is easily identifiable with a nation, while on the other hand enables people to communicate with each other, essentially without using words. We are honoured and happy that “Polish Market” has recognised the efforts of our band from Wielkopolska by awarding us with the special Pearl.”

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Honorary Pearls

Maryla Rodowicz with a pearl necklece from APART

Krystyna Woźniak-Trzosek and Eugeniusz Grzeszczak (deputy Sejm speaker) presenting Maryla Rodowicz with the Honorary Pearl in the category of Culture

Maryla Rodowicz – a seminal and legendary Polish singer, the First Lady of Polish song ”This award is a surprise. I have been awarded with various distinctions, including the Singer of the Year and the Best Performance at the National Festival of Polish Song in Opole. Never in my life would

I expect to receive the “Polish Market” Pearl…My career started in 1967, when I got my first award during the Students’ Song Festival in Kraków. I believe that this ”Pearl” will propel me into another 50 years of my career!”

Juliusz Braun, President of TVP

Juliusz Braun receiving the Honorary Pearl for the Television Theatre in the category of Culture

Juliusz Braun; the President of Telewizja Polska (the Polish Public Television) was awarded the 2012 Honorary Pearl of “Polish Market” “for bringing back the proven idea of live TV theatre. In essence, for reviving Polish Television to the old times when...”art was art”... “The fact that cultural undertakings are appreciated in the business community is deeply satisfying. The “Polish Market” Pearl is essentially the affirmation of the fact that what we do, and let’s be honest, we are on a mission, it’s not just a niche thing...It’s an important factor in social life in Poland. Of course, our plans involving live TV theatre can only succeed

if we have enough funds. We’ll do our best to broadcast premiere performances at least once a quarter, or even more often. However, given that we operate in a market economy, it is important to see that while TV theatre is surely a very effective factor in building social capital, the question of its financial performance is a more complex one.”

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Honorary Pearls Jerzy Stuhr, one of the most popular Polish theatre and movie actors, a director, a Professor at the Ludwik Solski State Drama School in Kraków, its longstanding Rector.

Jerzy Stuhr

“I believe that there are many great figures in Polish culture, and these are not only artists. For example, our sportsmen successfully represent Poland internationally... Well, they do have larger audiences. And this elite is the best showcase in Poland. As far as I’m concerned, I am deeply satisfied when Poles are recognised internationally, without having to scramble for recognition...It’s good to know that what you do in your profession is acclaimed internationally. It’s true that actors have a hard time making it to the foreign markets. I’ve done my best to promote Polish authors and Polish literature as well, wherever it has been possible. I’ve seen it as my obligation. Thank you for this distinction.” Eugeniusz Grzeszczak awarding the Honorary Pearl to Jerzy Stuhr in the category of Culture

Krystyna Woźniak-Trzosek presenting the Honorary Pearl in the Promotion of Applied Art category

Adam Spała

Adam Spała, owner and President of the AS Ćmielów Porcelain Factory, manufacturer of handmade porcelain products with over 200 years of history ”It is a very touching moment and an honour to receive the “Polish Market” award. Ćmielów awaits you! There you will find one of the oldest Polish porcelain factories, dedicated to perpetuating the values and achievements of entire generations dealing with porcelain. My workshop did not only reproduce patterns, but essentially revived the traditions and values of porcelain, which is more than just a noble commodity. Although I bought the plant in 1996, I

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have been involved in the porcelain business for as many as 27 years. On the premises of our factory there is also the Living Porcelain Museum, launched in 2005 to mark the 500th Anniversary of the granting of town privileges to Ćmielów. There, systematically, we demonstrate the entire process of firing the materials, all the way to the final product, which is unique and considered by many a work of art. We have arranged a special room where you can see and buy a complete collection of sculptures, which were designed in the 1950s and 1960s. This is certainly a place to remember.”

Honorary Pearls Prof. Czesława Frejlich received the Honorary Pearl in the Promotion of Applied Art category

Prof. Czesława Frejlich

Prof. Czesława Frejlich – an industrial designer and business graphics professional, Editor-in-chief of the best Polish quarterly devoted to design arts – 2+3D “As great a distinction the Polish Market Honorary Pearl is for me, I think it is rather the recognition of the profession I represent, since design is a branch of culture that has strong links with the contemporary economy. When used appropriately, it can affect it in a very positive way. I hope that the fact that the Pearl went to a designer will strengthen the cooperation between entrepreneurs and designers. And I do get the impression that now is a

terrific time for Polish design! Examples? The majority of designers today cooperate with the internationally-strong Polish furniture industry. Designers are also employed on a regular basis in the household appliances industry. Those vehicle companies which compete in tenders make sure that the appropriate designer solutions are in place to give them a competitive advantage.” Marek Michalak (Ombudsman for Children) and Krystyna WoźniakTrzosek

Bożena Kazanowska being presented with the Honorary Pearl for the Fostering of Patriotic Values Bożena Kazanowska

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Honorary Pearls

Eugeniusz Grzeszczak (deputy Sejm speaker), Krystyna WoźniakTrzosek and Krzysztof Król (Advisor to the President of Poland)

Krystyna Woźniak-Trzosek awarding the Honorary Pearl to Franciszek Ludwin for the Fostering of Patriotic Values

Krzysztof Król congratulating Franciszek Ludwin

Prof. Leszek Rafalski during his laudatory speech on Prof. The Honorary Pearls

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Henryk Skarżyński who received the Special Honorary Pearl

Honorary Pearls Professor Henryk Skarżyński “It is a great honour to me to receive the Pearl. Today I join such eminent figures as Professor Jerzy Buzek, who was its first winner. Twenty years ago, in 1992, when we implanted a cochlear implant and took a deaf person back to the world of sound for the first time in Poland and in this part of Europe, it was widely covered by the media. I realised the magnitude of the problem we had dealt with and how much hope we had given. Today in the World Hearing Centre in Kajetany we perform about 70 surgeries improving hearing, which is the largest number in the world, and the waiting list is still huge. I am sincerely thankful not only for the recognition of the Jury, but also for the fact that it acknowledged the huge scale of the problem concerning the increasing number of people with a variety of hearing problems”. From the left: Prof. Henryk Skarżyński, the Special Honorary Pearl, Alicja Adamczak (President of the Patent Office of the Republic of Poland)

The Laureate of the Special Honorary Pearl

Eugeniusz Grzeszczak (deputy Sejm speaker) handing over the Special Honorary Pearl to Prof. Henryk Skarżyński

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Pearls of the Polish Economy Jan Pietrzak and Krystyna Woźniak-Trzosek

From the left: Grażyna Henclewska (the Ministry of the Economy), Eugeniusz Grzeszczak (deputy Sejm speaker), Krystyna Woźniak-Trzosek and Edward Trzosek

Mirosław Satora (the Pro Omnibus Foundation) and Juliusz Braun (TVP)

Adam Jasser (Undersecretary of State at the Chancellery of Prime Minister) with his wife

Krzysztof Król (The Chancellery of the President of Poland)

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Michał Kleiber (President of the Polish Academy

and the Grand Prix winner in the Large Pearls of the Polish

of Sciences) and Krystyna Woźniak-Trzosek

Economy, Paweł Poncyljusz (Avio Polska)

12  /2012

Pearls of the Polish Economy Prof. Leszek Rafalski and Prof. Michał Kleiber

Jerzy Stuhr and Juliusz Braun Bożena and Zbigniew Hockuba

From the left: Maryla Rodowicz, Jerzy Stuhr, and Grażyna Jaskuła

Artur Orzech, host of the Gala Eugeniusz Grzeszczak (deputy Sejm speaker) and Krystyna Woźniak-Trzoseka

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Pearls of the Polish Economy Krystyna Woźniak-Trzosek and Jerzy Stuhr


The gala guests

Prof. Leszek Jasiński and Prof. Jan Macieja

From the left: Pinhas Romik, Jan Pietrzak, Bashir Abduhler (Charge d’Affaires at the Lybian Mission to Poland), and Monika From the left: Marek Goliszewski (President of the BCC), Prof. Michał Kleiber, and Grażyna Henclewska

Piątkowska (Director of the Social Communication Department at the Ministry of the Economy)

From the left, front row: Grażyna Jaskuła, Prof. Henryk Skarżyński, Jacek Sykulski, Jerzy Stuhr, and Maryla Rodowicz with her husband

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Pearls of the Polish Economy

The Honorary Pearls, from the left: Jerzy Stuhr, Maryla Rodowicz, Adam Spała Krystyna Woźniak-Trzosek and

Błażej Grabowski, Krystyka Woźniak-Trzosek and Xavier

Krzysztof Kurowski (Research and Development Director,

Douellou (3M Poland) Anna Pietrzak (Business Development Centre) and Marek Skała

Adamed Sp. z o.o.)

Franciszek Tomasz Ludwin with his family

The banquet featured Polish cuisine from “Polska Ekologia” Association

Wojciech Łastowiecki (ABC Data) receiving

Alicja Adamczak (President of the Patent Office of Republic of

the Pearls of the Polish Economy certificate

Poland) and Paweł Krajmas (Polska Ekologia)

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Pearls of the Polish Economy The Gala guests

The Gala guests

Franciszek Ludwin with son Jerzy Ludwin and friend

Krystyna Woźniak-Trzosek and Prof. Henryk Skarżyński

Wojciech Łastowiecki and Joanna Pydo (ABC Data)

Ewelina Janczylik-Foryś (“Polish Market”), Bogdan Węgrzynek and Anna Pietrzak

Artur Tomaszewski (DnB NORD) among the Gala guests

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We do not have a remedy, but we have a strategy Sanjay Samaddar, BOD Chairman of ArcelorMittal Poland for “Polish Market” about current situation in steel sector and new investments.

no doubt that – despite somewhat optimistic prognoses for 2012, the fragile economy was further impacted in the third quarter of 2012 and will hardly get better before spring 2013.

How does the global steel giant – ArcelorMittal perceive the current situation in the steel sector? Constantly challenging. Looking ahead, market conditions remain tough, especially in Europe. I have no doubts that the 2012 is another year of the crisis in our industry. Are there any perspectives for the recovery in 2013? I would not be too optimistic. There is some evidence that leading indicators are bottoming out but it will take a long time before we will be even drawing close to the levels from early 2008. Is this your view on the global economy, entire steel sector or specifically on the condition of ArcelorMittal? Given our share in particular steel markets, the condition of ArcelorMittal may serve as an indicator of the entire industry. Our financial results for Q3 and nine months of 2012 are the best evidence of the challenging market environment. This assessment is also confirmed by the World Steel Association which forecasts that during the entire 2012 the apparent steel use in the EU 27 will decline by 5,6%. The worst situation is in Spain and Italy, where the apparent steel use is expected to fall this year by 11,9% and 12,6% respectively. Even the most resilient economy, Germany will experience a decline of 4,7%. There is

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What are the reasons for such situation? There is a mix of factors which contributed to this situation. First is, obviously, the global economic crisis which strongly affected main customers of steel manufacturers – automotive and construction industries. What we also need to take into account is a slowdown in China, which was sharper than previously expected. Our situation in Europe was also strongly impacted by the crisis in the euro zone. If we add to this unfavourable market conditions, more and more stringent environmental requirements and competition from the BRIC countries, which is getting stronger, then we should understand why we speak about crisis in the steel industry and not about seasonal slowdown. Do you have a remedy? We do not have a remedy for controlling the economic situation, but we have a strategy, which allows us to immediately adapt to the changing market conditions. Flexibility is the best remedy for the tough situations but it does not permit us to forget about constant developing and investing. Personally, I am a great advocate of investments, even in the challenging conditions. I am convinced that investments constitute our strength. At ArcelorMittal Poland we have the biggest coking plant in Europe, which is located in Zdzieszowice and state-of-art hot rolling mill in Kraków. Neither the crisis of late 2008 and 2009, nor the current recession stopped us from investing in innovative projects in Poland. What sort of concerns does ArcelorMittal currently have? It comes as no surprise that the situation in Europe remains our biggest concern. Production capacity utilization remains low, merely at 70 percent of what it was 4 years ago. This forces us to implement various optimization measures.

What are the forecast for Poland specifically? Apart from low capacity utilization, which is a case also in Poland, the excise tax on energy products is the highest in Europe, therefore it is not easy to compete with such economies, where market conditions are much more conducive. Energy prices constitute one of the most crucial factors forming competitiveness of the steel-making sector. Nowadays, they are the reason why the Polish steel sector lags behind neighbouring economies and the EU’s median. What should be done then to retain the competitiveness of the Polish steel industry? It is necessary to introduce a series of systemic solutions, which will protect the national industry. This was a postulate we have recently presented to the government. Among the recommended actions, the most important is to adjust fiscal and para-fiscal burden related to the electric energy purchase to conditions in other EU countries. Also, the exemption from excise tax on gas expires next year… This is indeed a concern. But when it comes to the gas excise tax, we have already started discussions with the Ministry of Finance, which - as we genuinely hope - will result in introducing exemption from the gas excise tax for energy-consuming sector after 31st October 2013. Metallurgy sector is an enormous consumer of natural gas, and at the same time, a producer of process gases which are substitutes of natural gas. Potential introduction of excise tax for gas products would have a direct impact on higher cost base for steel-makers, which would additionally deteriorate the international competitiveness of the Polish industry. Such situation should be considered especially threatening in face of popular application of exemption from gas excise tax in other EU member states. A nd what is your view on the climate package? The climate package causes another threat to the steel and other energy-intensive industries. As I stated, energy prices shape our competitiveness to a great extent. If energy producers are obliged to purchase CO2 emission allowances on the open market, then they are going to pass this cost onto their customers. This will most probably result in even higher expenses on our side, which in turn will impact our competitiveness. From the perspective of the Polish steel sector, unification of energy conditions within Europe should be agreed. This would allow maintaining a level


The biggest coke plant in Europe located in Zdzieszowice

ArcelorMittal Poland’s state-of- the-art hot rolling mill

playing field between different steel producing regions.

bars only could have deprived the state treasury of several hundred million zlotys.

I could imagine that the energy prices are not the only concerns you have in Poland… Obviously not. As a matter of fact, the list of concerns is growing, and we need to find mitigation plans which can only come with government intervention and support, about which I remain optimistic because I am confident that the Polish government and we in industry have a common agenda – the growth of the metallurgical sector in Poland. Our condition was also hit by the illegal practices in the steel trading and VAT frauds on reinforcing bars and other steel products, occurring in the past few years. According to the estimates made by the Polish Steel Association (HIPH) and the Polish Union of Steel Stockholders (PUDS), as much as 40 percent of reinforcement steel sold on the Polish market may come from illegal sources. In this situation, the legally operating companies fight a losing battle and lose their market shares to the entities employing unfair practices, able to offer cheaper products due to the fact that they do not pay the required taxes. For many, the 23-percent VAT rate “profit” on the market where the usual margin reaches no more than several percent is worth pursuing even at the cost of going to the tax office’s bad books. In result, fairly acting companies lose and need to optimize production capacity, which brings such effects as lower income and necessity to reduce employment.

Is the governmental action needed? I do not see any other solution. We have already drawn the attention of the Polish government to the fact that actions need to be taken to counteract these tax frauds. In our view, the response should be focused on intensified market control and realistic legislative measures discouraging entities from employing unfair practices and depriving them of economic motivation to commit crimes.

This situation does not only affect companies, but also the state budget… That is true. The aforementioned industry organizations estimate that both in 2010 and 2011 illegal practices related to the reinforcing

How important are the Polish units in the ArcelorMittal Group? Poland is a strategically important market for ArcelorMittal. Since the privatization of Polskie Huty Stali, we have invested here more than PLN 4.5 bn on modernization of our facilities and projects aimed at improving work safety of our employees, as well as our environmental footprint. The best proof of the fact that the Group Management Board has confidence in our assets is that even in the very difficult economic conditions recently a few more projects have been approved. What kind of projects they are and when they will be completed? These new investments include modernization of the Basic Oxygen Furnace no. 2 in Dąbrowa Górnicza and the Hot-dip Galvanizing Line in Świętochłowice, as well as establishing a Sheet Piles Service Centre. An objective of this move is to enhance our position in the market and adapt our operations to the most recent European technological standards. The revamping of BOF and the HDG line in Świętochłowice aim at increasing safety, sustainability and reliability

Recently inaugurated coke gas cleaning installation worth 100 m PLN

of the installations. We plan to finalize these projects by the end of 2013. We are also working on the long rails project, waiting for a re-validation of the market demand evolution which will determine the timing of the project. Is there a threat that the economic conditions can thwart your plans? It is my personal and professional objective not to allow such situation. ArcelorMittal wants to keep investing and developing in Poland. Three months ago we inaugurated a coke gas cleaning installation in Kraków’s coke plant. This project, worth PLN 100 m will improve the facility’s environmental footprint through reduction of energy consumption and decrease of the amount of waste produced during the technological process. The total value of all modernization projects which are in various stages of completion in Krakow’s steel plant amounts to PLN 220 m. They include the biological waste water treatment plant, new torpedo ladles for transport of hot metal and replacement of some of the hot stoves at the blast furnace. But we have appetite for more… :: 12 /2012  ::  polish market  ::  35


Revival or panting? It is too early for a reliable assessment of this year, which is coming to an end. However - according to the Central Statistical Office - in the period January-October 2012, industrial output (at constant prices) was 2.5% higher when compared to the corresponding period in the previous year. Jerzy Bojanowicz In October - according to preliminary data - in the companies employing more than 9 people production was 4.6% higher than a year earlier, when growth of 6.4% had been noted, and 7.7% higher when compared to September. After eliminating the impact of seasonal factors, production was 0.06% higher than in the same month in the preceding year and 1.9% when compared to September this year. In comparison to October last year, growth in production was noted in 27 (out of 34) sectors of industry, including over 8% growth in 6 of them: extraction of hard and brown coal, the production of electrical equipment, chemicals and chemical products, paper and paper products, food products, computers, and electrical and optical products. A drop in industrial production, when compared to October last year, took place in 7 sectors, including metal production, the manufacture of motor vehicles, trailers and

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semi-trailers, furniture, and products made of other non-metallic mineral products. Dr Małgorzata Starczewska-Krzysztoszek, the main economist of the Polish Confederation of Private Employers Lewiatan, so comments on the data from the Central Statistical Office: “Industry, after a sharp slowdown in September, caught its breath again. That is because in recent months there have been more and more sectors of industry which have decreased their production - in July there were 11 of them, in August - 15, and in September - as many as 27. In October there was a turnround in this trend - a decrease in production took place only in 7 sectors. The producers of chemical products, food products, and computers are doing well. This is mostly due to their ability to compete on foreign markets - after 3 quarters of 2012, exports of agricultural and food products have increased by 12% year on year,

and chemical products by 3.3%, including fertilizers, by 15.5% with an overall growth in exports by 1.9%. The electrical machinery industry is also doing very well. This favourable export trend in these sectors of the economy also continued in October, and it was probably partly conducive to the good results of industry. It indicates the ability to maintain industrial production in 2012 at the level 2.5–3% higher than in the previous year, and it augurs well for the whole economy, since fortunately industry in Poland still generates nearly 25% of GDP.” And so - as indicated by the data of the Central Statistical Office - during the 3 quarters of this year - in comparison with the same period in 2011 the output of hard and brown coal, crude oil, natural gas, and copper, lead, and sulphur ores and concentrates was higher. Except for crude oil, the growth rates are by a few percent, but this is still growth! Contrary to what is commonly believed, influenced by high fuel prices, the production of fuel and diesel fuel as well as motor oil also grew by a few percent. A more than 12% growth - although the previous winter was not very harsh - was noted by the producers of fuel oils (light fuel oils -+32.6%) and LPG

Did you know? One out of six cars in the world is made of ArcelorMittal steel.

This is us

Industry used to fuel vehicles. The production of multiple-glazed units has grown by 36.2%, although house construction has not achieved great success (the manufacture of bricks and hollow bricks has decreased by over 30%, cement by 12%, and ready-mixed concrete by 21.8%). The condition of the metal industry is varied, since on the one hand, the manufacture of cold-rolled flat products and copper sheets and strips has significantly decreased, and, on the other, the manufacture of aluminium wires and aluminium alloys has increased by as much as 48.3%. What is also surprising is the nearly-100% rise in the production of machine tools for metals (machining), of which 2,583 were produced.

Cars and electronics One of the pillars of the Polish economy is the automotive industry. In 2011, the value of production in this sector amounted to 13.6% of all industry; up to the end of the previous decade it provided 1/6 of export earnings, and in 2010, 115 thousand people were employed in the automotive industry (ranked 6th in the EU), and each job generated 5 additional jobs in cooperating businesses. This year, from January to September, the assembly lines in our factories produced 434 thousand cars, that is 25% less than in the same period in 2011. The year 2012 looks like it is not going to be any better. This is the result of the economic slump in Western Europe and.... politics. Fiat has announced that the Fiat Auto Poland factory in Tychy - so far the biggest and the most efficient among European factories - is ending the assembly of the urban Panda Classic. The first car left the factory in 2003, and in 2009 production in the Polish factory in Tychy was record-breaking, as 606 thousand cars were produced then, which is almost as many as 5 Fiat factories in Italy produce. However, during the last 3 years production has been decreasing, and in 2011 it was 40% lower than in 2009. Still, the older versions of the Panda are produced in Tychy (so far more than 2.15 million cars), but the new ones are produced in the modernised factory in Pomigliano d’Arco near Naples. Why did Fiat start to move production from Poland to Italy? Not due to

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economic or industrial reasons. “We did so, because we believe that it is our duty to give priority to the country which is Fiat’s motherland,” explained Sergio Marchionie, the head of the concern during the ceremony for starting production in Pomigliano d’Arco factories. In October - as a result of poor sales on the European automotive market and gloomy forecasts for 2013 - the management of General Motors announced a reduction in the operation of the assembly lines in the Opel/Vauxhall factories. In all European factories, night shift has been done away with, and in Luton, UK, a one-shift working system introduced. In Poland in 2011 the Opel factory in Gliwice produced less than 174 thousand cars (in 2011–158.7 thousand), while its production capacity amounts to 207 thousand cars per year. Also during this year, the slowdown on the European automotive market is expected to be followed by a fall in production. It is worth emphasising that over 98.6% of the cars from Gliwice were exported. At the same time, at the end of October, the luxury car producer in the Nissan group - the Japanese company Infiniti - withdrew from the planned investment in Żerań in Warsaw (the former FSO). Therefore, we might not be an automotive superpower, but Poland, which not everyone may realise, is the European leader in flat-screen TV production (LCD, PDP), and it is also second (after Germany and overtaking Italy) in the production of home appliances, specifically the so-called white goods (refrigerators, washing machines, etc.). In 9 months, 14.4 million TV’s were produced (0.2% less than in the same period in 2011) and 1,675 million refrigerators and freezers (+17.5%), 3,618 million automatic washing machines (+21.3%) and 2,378 million dishwashers (+8%). More than 90% of TV’s and home appliances were exported. Let me remind you that a number of companies have their factories in Poland, such as TP Vision (producing under the Philips brand), TCL (Thomson), LG, Sharp, Toshiba, Funai and Orion. Unfortunately, at the beginning of November, its executives announced the dismissal of the majority of its staff, because - as the Management Board explains - the end of production was forced by the especially-difficult

situation on the TV market and strong competition from Korean producers.

Slower pace According to the „Information on the Socio-Economic Situation of Poland in the period 1st - 3rd quarter of 2012” published by the Central Statistical Office, the pace of economic growth in this period was slower than a year earlier, and will be getting weaker and weaker in the next quarters. In the 3rd quarter of this year there was a small drop per annum in the production of industry and a substantial one in construction and assembly production. According to preliminary data, producer prices in the industrial sector in October 2012 were 0.7% lower than in the previous month. The biggest drop in prices was noted in mining & quarrying, including the extraction of hard and brown coal (lignite) and in metal ores mining. Also the prices in industrial processing dropped, especially in the production of coke and refined petroleum products. A drop in prices was also observable in the production of metals, pharmaceutical products, computers, electronic and optical products, motor vehicles, trailers and semi-trailers, chemicals and chemical products, rubber and plastic products, electrical equipment, furniture, other non-metallic mineral products, production of other transport equipment, textile products and clothing. Prices increased in the production of food products, paper, and paper products, metal products, machinery and equipment. This rise in prices (by 5.9%) was also noted in the sector of generating and providing electrical energy, gas, heat and hot water, which was felt not only by industrial plants, but also households. However, despite the decrease, producer prices were in October 2012 higher by 1.0% than a year earlier. As regards companies’ revenues, it might seem - considering the economic slump - that it is not bad, as they have risen year-on-year by 6.5% after 3 quarters. However, this growth is by half slower than in the 1st quarter of this year. What is more worrying is the pace of cost growth which is clearly faster than that of revenue growth, which is resulting in a significant fall in the return on of sales,” comments Dr Małgorzata

To our Employees, and Business and Social Partners we extend wishes for a Christmas as magical and special as the miracle of the Bethlehem Night and a joyful New Year holiday.

The Management Board of Cementownia Warta SA

Industry Starczewska-Krzysztoszek on the financial results of large and mediumsized enterprises after 3 quarters, given by the Central Statistical Office. The financial net result of companies is more than PLN10 billion lower than in the same period in the previous year. Also net losses have grown considerably, that is by more than 1/3. Investment growth has also decreased significantly. At constant prices it was higher by 4.4% than in the previous year. After 9 months of 2011, this growth amounted to as much as 12% when compared to 2010. If it were not for the previously-started investments in buildings and structures, the pace of growth would have been even lower. On the other hand, exporting companies, despite a visible slowdown among our main European trading partners, managed pretty well - the percentage of companies which sold their products on foreign markets grew from 46.6% to 48.1%, and the share of exports in their total sales revenue has

grown. It confirms the thesis that we have presented for a very long time on the basis of research that Polish companies are able to effectively compete on external markets - by a mixture of good prices and quality and increasingly often by innovation. As a result, in the exporting companies sector there are more companies, which achieve positive financial results, and their financial standing is better than that of companies in general.

Economic downturn The picture of how the year which is coming to an end, is being assessed by the parties concerned, emerges from the research of the Central Statistical Office, on the basis of which it prepared the report “The Economic Situation in Industry, Construction, Trade and Services.” However, the general economic climate in the manufacturing sector in October is being assessed negatively, worse than in September and corresponding months over the past 10 years.

This pessimistic mood has darkened even more among manufacturers, construction units, and retailers companies. The majority of respondents from service companies also assess the situation negatively. An improvement is indicated by 12% of the companies being analysed, while a deterioration by 23% (a month ago it was 14% and 20% respectively). The remaining companies believe that the situation has not changed. Among small companies, the amounts due from contractors are growing more slowly than a month ago, while in the case of large companies it is just the opposite. However, all of them, regardless of their size, indicate difficulties in settling current financial obligations. And the forecasts made by the entrepreneurs are pessimistic, worse than last month’s forecasts. This is reported mostly by small companies. Does it mean that a new bankruptcy wave is looming over us? Nevertheless, the most favourable assessments of the general economic climate are formulated by the producers of pharmaceutical products, paper, and products made of paper. The negative voices in this respect come mostly from the producers of metal, clothing, other non-metallic mineral products, textile products, wooden products, and leather and leather products. The turnover in foreign trade (in PLN), in the period January - August of this year grew year on year, but more slowly than a year earlier. The stronger growth of exports than of imports has contributed to an improvement in the foreign trade balance.

Forecasts “The data after three quarters of 2012 indicate that the year will probably close for entrepreneurs with a slightly higher value of revenue from sales, but with considerably smaller profitability, smaller financial liquidity, and a significantly lower net financial result than in 2011. Then, it amounted to nearly PLN104 billion; this year it will probably barely exceed PLN90 billion. In addition to the more difficult access to external financing, it will have a negative impact on companies’ ability to develop in 2013,” states Dr Małgorzata Starczewska-Krzysztoszek.::

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The installation of the recovery boiler with the technological equipment in Iggesund

The desulfurisation of installations in the combined heat and power plant of Zakłady Azotowe Puławy S.A.

Power energy requires specialised capacities and relevant experience For over 50 years, Mostostal Puławy S.A. has been developing its activity on the Polish market. The origins of the company go back to the time of the great chemistry investments in Puławy. Initially, we were a division set up specifically for this task, but through the experience in the industry, bridge and large-size construction sectors we have started to explore power energy which today constitutes an important part of our business activity. We have completed many interesting and challenging contracts both in Poland and abroad. Mostostal Puławy S.A. has many times been awarded for the quality and reliability of its services, including the Ambassador of the Polish Economy (Ambasador Polskiej Gospodarki) and the Ambassador of the Lublin Region (Ambasador Lubelszczyzny). Moreover, the company’s internal policy has led to employing professionals and specialists, which is why we offer our investors services of the highest standard.

In steel, we can do anything Mostostal Puławy S.A. carries out investments in power energy and environmental protection, industrial installations and engineering as well as large-size construction sectors. As references and licences are important to our customers, we are continually improving our employees’ performance and preparing them for new challenges. On the list of contracts implemented in Europe there are many municipal waste-incineration plants, sorting plants and dust-removal and desulphurisation installations. Over half a century we have gained experience and, as a result, cooperate with major corporations in the world and carry out the largest investments. Mostostal Puławy S.A. provides specialised crane services, which is why we care about the quality of service and continuous development in this area. Our cranes have recently worked on the construction of the National Stadium, as well as during the implementation of a new shaft in the Lubelski Węgiel “Bogdanka” mine. The equipment is checked and the proper quality of our services is ensured on every investment site. The installation of the biomass 95 th boiler for the E.ON Örebro combined heat and power plant in Sweden

Investors trust us because our work is of the highest quality Caring for the certification of services for us is the prerequisite for functioning on the market. Our work organisation is the result of many years’ experience and know-how. The solutions which we are utilising today have been developed progressively. Good communication and investors’ confidence have been recognised by business institutions which have honoured Mostostal Puławy S.A. with the European Medal - “Company For A Medal” distinction as well as the Employer of the Year and the Building of the Year awards. Over the years, our company has also expanded its steel construction and prefabrication plants. We have our own design and crane back-up facilities. Our subsidiaries, Zakład Budowy Aparatury i Remontów Specjalistycznych MEZAP Sp. z o.o. and Przedsiębiorstwo Remontów Energetycznych ENERGEZAP Sp. z o.o. are efficiently operating enterprises. We employ nearly 1,300 people (including the subsidiaries).



in the Polish agricultural market Werner Ballieu, Director of CNH Polska Sp. z o.o., talks about the opportunities offered by the Polish agricultural market.

CNH is a global leader in the agricultural and construction equipment businesses. What is your view on the current market situation? Is there a crisis in your industry? CNH is indeed a world leader in the agricultural and construction equipment businesses. Created in 1999 through the merger of New Holland N.V. and Case Corporation, CNH today comprises the heritage and expertise of three agricultural brands: Case IH, New Holland Agriculture and Steyr, and three construction equipment brands:

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Case Construction Equipment, New Holland Construction and Kobelco. We have 37 manufacturing facilities, located throughout Europe, North America, Latin America, and Asia, and a network of approximately 11,300 dealers in 170 countries. Thanks to our broad product offering, and global presence, CNH realized a robust and substantial growth over the last years. If we have a look at our Polish production plant, CNH Polska Sp. z o.o. in Plock, we can see the same picture. We produce the TC-range combine harvester, round balers, grain headers and corn headers. Notwithstanding Europe is our main market, you will find machines produced in Plock all over the world. Also our Plant can demonstrate a substantial and robust growth over the recent years. CNH offers products used in agriculture, like for example tractors and harvesters. Why has the company, which is a global player, decided to set up a subsidiary in Poland? The production facility in Plock has actually a rich history, some key dates are 1948, when “Fabryka Maszyn Żniwnych” was founded, and 1992 when

a restructuring took place, changing the name in “Bizon”; for sure a well-known combine harvester brand in Poland. The modern history for the Plock plant starts in 1998, when New Holland acquired Bizon. The driver was to be well positioned in the growing Eastern European markets, as well as increase production capacity. Gradually, products were transferred to the Plock plant. First was the New Holland TC-range combines, followed by grain headers, the fixed chamber round baler and the variable chamber round baler. The Plock plant has become also a major supplier of components and sub-assemblies for our sister plants in Belgium, Brazil and North America. Poland was once one of the largest producers of agricultural machines. The flagship product was the Bizon combine. Is there a successor to the Bizon combine in your product line? The last Bizon combines were produced in 2003. They were replaced by the New Holland TC-range combine. The first New Holland TC combine produced in Plock, came off line in September 2001, so for some seasons both brands were offered. The TC-range has proven to be a good successor: the production volume in CNH Polska has steadily grown from about 450 units in 2003 to about 1800 units that will be produced in 2012. On the domestic

Industry combine market we are the number one, with appr. 38% market share. Producing the TC- range combines in Poland gives us for sure a competitive advantage on the domestic market. You have seen your company expand significantly in the past several years. This is reflected in the Pearls of the Polish Economy rankings. You had been roughly in the middle of the league table in the past years, but in the 10th edition you jumped to sixth place. This is remarkable progress. We see indeed a significant growth in CNH Polska over the last decade. Let’s look at some key figures: in 2003, we produced 450 combines, 400 balers, 140 corn-headers and 800 grainheaders. We had about 700 employees on our payroll. Eight years later, in 2011 we produced 1600 combines (+400%), 2300 balers (+575%), 600 corn-headers (+430%) and over 5000 grain-headers (+625%). These impressive figures are driven by organic growth as well as new product allocations to the Plock plant. We now have over 1500 employees on our payroll. And 2012 promises to be a new record in terms of production volumes for CNH Polska. Besides the volume growth, CNH Polska is also undergoing changes and is growing towards lean manufacturing. A major programme we are driving is “WCM” (World Class Manufacturing) which is changing the culture of a company by creating a continuous improvement environment, driven by and involving all employees. This aims at improving continuously health & safety, quality, manufacturing processes, cost efficiency as well as our ecological footprint. CNH Polska is ISO9001, ISO14001, OHSAS18001 certified. In November this year, we were audited and granted also the ISO50001 energy certification. We increasingly hear that it is necessary to combine knowledge (technological research) and business. Is this kind of transfer taking place in your company? Are technological research findings transferred to the marketplace? For sure, just as you cannot compare today’s cars with the ones produced ten years ago, the same is valid for agricultural machinery. Functionality, reliability, ergonomics, safety and features satisfying specific customer expectation are enhanced all the time. There

is also a tendency for increased capacity. A good example is the grain-header: In 2004 the biggest grain-header we produced was a 24ft. header. Over the last years this has grown over a 25 ft. and 30ft. to a 35ft. grain header. This is also driven by increased capacity of the combine harvester. Another important evolution is driven by the environmental aspect. Engines are becoming more powerful, but at the same time also more environmental friendly. Also the ergonomics and comfort for the operator are improved continuously. A combine harvester cabin offers all the luxury you would expect from a top brand car: air-conditioning, low-noise levels, panoramic view, even a small fridge to keep your drinks cold is available.

Poland in June 2011. For sure the country has undergone and is still undergoing a lot of changes, you see new buildings, shopping malls, office buildings… proving that Poland was doing quite well economically. The big cities are vibrant, and having the chance to watch a Euro 2012 football match in the new stadium in Warsaw was a great experience. However, there is still a lot to do in terms of infrastructure in Poland: highways are under construction, but the amount of kilometers of highways is still very low. A good highway network is necessary to support the economy. ::

What are your plans for 2013? For sure, 2013 will be a very challenging year for CNH Polska. We plan to launch a lot of new models and the volume forecast is very promising. We will also continue our journey towards “World Class Manufacturing”. This will be the fundament for the future success of our company. You are Belgian, but you have lived in Poland for several years now. What are your observations about Poland’s development? What changes, in your view, have taken place over these years? I spent about 2 years in Poland, 10 years ago. After that I was living in England and Belgium, and moved back to 12 /2012  ::  polish market  ::  43

Chemical industry

A new natural-resource policy as a remedy for hard times On 28 October 2012, Warsaw hosted the First Poland-wide- Chemical Industry Forum. The media patronage over the event was taken by the “Polish Market” Magazine. Ewelina Janczylik- Foryś

Mikołaj Budzanowski, the Minister of the State Treasury, made the inaugural address which observed that the perception of the chemical industry is changing: “The unexpectedly-dynamic M&A developments in this sector were a powerful inspiration, pushing me to explore new development opportunities in the chemical industry.” Moreover, Minister Budzanowski talked about the future of the Polish chemical sector: “There are two tools we can use to foster the growth of the chemical industry – one is a sound natural resource policy aimed at doubling natural gas extraction; the other is the financial policy in the form of the Polish Investments programme.” “The Poland-wide Chemical Industry Forum” aims to illustrate and analyse the position of the Polish chemical industry from the global perspective. The Forum brought together an international group of experts and top managers and offered an open discussion. Discussed during the Conference was the impact of globalisation on the growth of the Polish chemical industry. The opening panel session focussed on describing the challenges that the Polish chemical sector is facing. Most importantly, these are related to the liberalisation of the gas market and the growing petrochemical sector. What is more, the chemical market in Poland has extensive needs and requires complex funding, which makes it difficult to facilitate its

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development. To make things worse, there is the uncertainty related to the EU policy regarding CO2 and the lack of viable investment programmes. The panellists also discussed the future of the Polish chemical industry and the scientific innovations emerging within the sector. Asked about the current condition of the chemical sector, Robert Stankiewicz, the President of the Board and CEO of DOW Polska, said: “I can say what is going on from the standpoint of DOW Polska. The companies are now switching to more advanced products. With natural resources being so important today, and mark-ups so uncertain and unpredictable, we have to look for and develop products which will enable us to adopt a longterm strategy. Again, we are aware that the resources we use should be as competitive as possible. This is why DOW Polska is striving to create the broadest-possible portfolio of technologically-advanced products. The chemical industry has undergone a dramatic transformation. Modern-day companies specialise in certain products, and at the same time strive to catch up with and seek new technologies. That is why, the budget for R&D of new technologies is of great importance. DOW Polska has been investing in R&D, just as the global leaders have.” Jarosław Michniuk, the President of Selana FM, was asked the same question:

“Many people are very optimistic, claiming that the chemical industry is doing very well, given the good stock performance of the chemical companies quoted on the Warsaw Stock Exchange. However, we are facing many challenges that are yet to be tackled. What Poland needs at this moment is a development strategy for the chemical industry, which in my view has not been developed. We are now focussing our efforts on securing a cheap source of energy in the form of shale gas, and it is the right thing to do. Nonetheless, we cannot escape the question of how the Polish chemical sector will develop within the next dozen years. I get the impression that while this issue is of concern to the Boards of the individual companies, their owners, usually the State Treasury, fail to address it. This is my first conclusion. The other is that the condition of our chemical industry is different from that observed in other European countries. Aware of the opportunities and dangers of globalisation, the European chemical industry is pursuing the appropriate strategy. Among other things, it is about the companies carrying out divestment and acquisitions to consistently change their portfolios and focus on specialised end-use products. While carrying on with essential upstream investment, which is indeed necessary to remain cost competitive, companies are very creative in managing their product portfolios. This, according to the study run by Roland Berger, has made the value of the indexes of chemical products manufactured in Europe grow by more than 300% since 1997, and by 2015 it is projected to grow by 500%. This is because the chemical industry in Europe is oriented towards tailor-made products to suit specific client needs and secure higher mark-ups. While Europe has identified and established its current standing and the plans for future development, Poland still is completely failing to do so.” Attending the event were the representatives of major international and Polish companies, including: Azoty Tarnów, BASF, Dow Polska, Gide Loyrette Nouel, Lotos Group, Pern Przyjaźń, PKN Orlen, PwC Polska, Selena FM, Societe Generale, Synthos, Zakłady Azotowe Kędzierzyn, Zakłady Azotowe Puławy and Zakłady Chemiczne Police.::


Energy market in Poland There is no doubt that when compared to other CEE countries, Poland is a country in which many investment projects have been initiated with great momentum and many more are in the pipeline. It might be surprising why projects worth billions are being implemented in Poland, but it should be said openly that the existing dilapidated electricity generation infrastructure and transmission grids naturally need to be replaced. Igor Hanas Why are there still coal-fired power stations? Many people probably find it strange that given the EU’s quite restrictive climate policy, which promotes above all renewable energy, gas-fired power stations, and also nuclear power stations, coal-based power stations are still being built in Poland. In Poland’s case the answer is simple. At the moment more than 90% of electricity is produced in Poland from brown coal and hard bituminous coal, because Poland has the largest resources of these in Europe, and moreover most of its existing power stations, with some exceptions, are 30 or more years old, and therefore they need to be replaced in the natural course of things by new, highly efficient and environment-friendly installations.

Multi-billion conventional energy projects Even now there are a few projects underway for PGE Group to build installations of supercritical parameters in Opole (2x800MW) worth in excess of USD 3 billion, and by Enea in Kozienice (1000MW) worth USD 3 billion. In the near future tenders will be decided in Tauron in Jaworz­ no (910MW) worth USD 1.7 billion and PGE in Turów (460MW) worth USD 1 billion. Also there still remains the prospect of new coal plants being built by private investors and Energa, and mines, which, in the form of a joint venture, hope to operate power plants in addition to extracting coal, to increase profitability. It should not be forgotten that the intensive upgrading of Polish coalfired power stations is underway to meet the stricts environmental standards brought in under the new

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Industrial Emissions Directive. This upgrading process will have to be implemented in the most part by 2016, and subsequently will also cover other installations, up until 2023. Also, there are projects already decided upon and in progress for the construction of large gas-fired power stations in Stalowa Wola, Grudziądz, and Pomorzanin and one planned in Warsaw, not to mention local cogeneration on a smaller scale, which is gradually shifting from hard bituminous coal to gas. The above shows that in the years up until 2020, conventional energy on its own will require not only a great deal of spending, but will also need supply of technology, deliveries, and services. For this reason international suppliers of technology will be able to take part in projects of a value in excess of USD 2 billion, which is the minimum that will have to be implemented.

A new approach to renewable energy Under the obligations it has assumed up until 2020, Poland is required to produce 15% of energy from renewable sources. The new regulations that are to be introduced as of 2013 will significantly change the renewable energy market, moving the generally criticized funding of biomass-coal co-firing to wind energy, photovoltaics and biogas and biomass energy. There is therefore a clear trend of structuring renewable energy as a spread of medium and low capacity. This change of concept and departure from co-firing in industrial power stations means that over the next few years there will be a gap in renewable energy which will have to

be filled by wind energy, photovoltaics and biogas and biomass energy at a considerably faster rate than has been the case up to now. Energy producers are becoming interested in acquiring renewable energy assets, and we can also expect to see vital multi-billion investment projects in the coming years needed to meet the EU standard of 15% of energy from renewable sources. This will entail demand for new technologies and the proper equipment, but also know-how as to the long-term management of such a business on a regulated market. The M&A market will certainly see intense growth due to the fact that the large energy producers in Poland are rather more interested in acquiring projects that are up and running for cash from companies that start up such installations and handle the entire investment process professionally than implementing such schemes on their own.

Shale gas and the first nuclear power station in Poland In Poland as well, for a number of years, there has been a lot of excitement about the anticipated unconventional gas deposits, the largest in Europe. Everyone expects Poland to be successful in emulating the gas revolution that is currently occurring in other places around the world. This is also of strategic importance to Poland due to the need to diversify its gas supplies and increase its own domestic production. Both the scheme recently announced by the government, earmarking large sums to speeding up the process of prospecting for unconventional gas deposits and also the interest on the part of major global players on the shale gas market mean that there are not only investment opportunities and need for capital; it also means that the entire infrastructure needed to exploit the gas fields will have to be built, which at the moment simply does not exist on the sites where prospecting is taking place. In the short term, the funds designated for the shale gas sector, aimed at achieving the desired effect, will have to be much more than the USD 30 billion cap. Most of this will be private capital of investors who have obtained concessions and are now searching for shale gas. It can only be

Energy mentioned that in the near future the government intends to provide funding for prospecting and extraction of shale gas in Poland of USD 13 billion. At the same time, preparations are continuing for the construction of the first nuclear power station in Poland of an envisaged capacity of MW 3000 and cost of USD 14 billion. Talks are being held with potential technology suppliers, and electricity is scheduled to flow for the first time in 2023. The nuclear plant is intended to have a positive effect on Poland’s energy mix and to reduce global emissions.

Not only generation of energy One important aspect, which sooner or later will also have to be put into place, is not taken into account in the general discussion regarding building new sources of energy. The construction of new coal, gas and nuclear power facilities planned in coming years, the increase in the amount of renewable energy produced, and the extraction of unconventional gas, will mean that it has to be transmitted to potential users or to a transmission system. The Polish transmission network has suffered under-investment for many years, and the beginning of construction of new power stations will in practice force work to be done in this field as well. Over the same period of time, the upgrading of transmission networks and gas networks will use up approximately USD 15 billion of capital.

More than USD 50 billion in the coming years for investment projects and the traps awaiting investors Taking a conservative estimate, bearing in mind the projects now underway and described above, or those that are to be implemented soon, the energy sector has at last started making real investments intended to change the face of the Polish energy industry after many years of stagnation. It also has to be stated clearly that a foreign investor not accustomed to the true conditions that prevail on the Polish market may be surprised by the specific nature of tenders in Poland. The majority of public contracts in the energy industry are subject, due to their value, to the Polish Procurement Act regime. One could wave this

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aside since it is the general rule in the case of public sector (sensitive) tender contracts in the EU, however in Poland the practice has turned towards excessive formalism, and someone may finally get the impression that the form of a bid and form of conducting the tender is more important than the technical subject area covered by the bid itself. This results in a situation where potential foreign investors, surprised by the formal side and requirement to deliver official documents from their countries, are frequently excluded from tenders at the very beginning of the proceedings. The appeal procedure is also intriguing in the sense that the appeal is not examined by an independent court of the first instance but by a special quasi-court authority which operates as part of the Public Procurement Office which, as it can be sometimes felt, focuses only on the formal side of the proceedings and somehow passes over the purpose of the proceedings, which is seeking to select the best bid in terms of the substance and in terms of the price. Rulings of the National Chamber of Appeals may, in fact, be appealed against by filing a complaint with an independent court, however court fees for such proceedings are considerable, and once the price bids have been submitted, court fees often simply discourage bidders from continuing to fight for the selection of their bids.

that have already been discussed. Furthermore, one could get the impression that, in the majority of cases, energy industry contracting parties are resistant to certain world standards, for example relating to the division of risk between a contracting party and a potential contractor and limits of liability, which very often results in certain international entities eventually not submitting their final bids if conditions of a public contract considerably differ from global standards.

Apart from the above, a foreign investor may also be surprised that in the case of projects valued in millions or even billions, time limits for submitting various applications, objections or appeals are very short and often they do not exceed a week or two weeks, which, bearing in mind the complexity of these proceedings, with no proper prior preparation, in practice renders impossible reasonable, effective actions. Interestingly, such strict discipline is not imposed on contracting parties which in turn may prolong the proceedings at their own discretion. With regard to negotiation itself with contracting parties which usually take place in the case of major projects, it is often the case that negotiations are conducted within quite short time limits and usually there is no opportunity to return to issues

Despite these specific regulations, which may at first discourage foreign investors and contractors, it should be emphasized that inevitable modernization of the energy industry over the next years will be the driver behind economic growth in Poland.

International entities face these challenges practically in each energy industry project where the contracting parties are energy companies controlled by the state or which receive public funds. Only in the area of investments in renewable energy does the advantage of private capital cause that these investments are implemented efficiently without unnecessary lengthy tender procedures subject to the Public Procurement Act. As far as expected investments in the extension of energy or gas transmission networks are concerned, a special Act on Transmission Corridors is to be adopted, which will make it possible to implement those projects more quickly. Currently, contracting parties try to shift the risk of the conflict with owners of the real property which the transmission lines are to cross to contractors.

It is a big challenge not only for energy companies but also for technology providers, producers of equipment, and EPC contractors, since they are precisely the ones who will be implementing the mentioned investments, but also for financial institutions and private investors because they after all are already actively involved or will be involved in these projects. ::

The author is attorney at law at Squire Sanders Święcicki Krześniak law firm.


Developing innovation for aviation industry Paweł Poncyljusz, Member of the Board of Avio Polska Sp. z o.o., speaks to “Polish Market’s” Ewelina Janczylik-Foryś about innovations, new projects and plans for the future.

Avio’s brand statement is “in the air, at sea and in space”. The air refers to civil or military aviation, the sea is about designing and manufacturing marine engines. And what is the space? Avio’s commitment to space is no idle boast. Avio has its satellite launcher VEGA. In Europe, we have 2 rockets: one is ARIANE 5, for which Avio manufactures solid fuel rocket propulsion, and VEGA for which is co-produced by Avio. VEGA is also the name of the entire programme is which Avio plays a crucial role as the Prime Contractor with the responsibility for the design, development and production of missile systems for the rocket. So it is not just our dreams for the future, but something we actually do. We have

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the whole space division located near Rome. I must admit that my ambition is to base some of Avio’s space activities in Poland. Although aviation still prevails, there is also a chance to conquer the space, especially that Poland has recently become a member of the European Space Agency. It is worth developing the space business in Poland. Avio is skilled enough not only to talk about providing space technology, but also to build rockets. Avio is competent when it comes to composite coatings, of which rockets are made. In Poland, the problem may not be the scientific aspect, where we have a lot to offer, but the industrial aspect. I hope that Poland’s accession to the European Space Agency will provide the impetus for Poland to get more interested in

this issue. I would very much like that these technologies be developed in Poland. We have vast expence in aviation, and our academic background is so strong that we have managed to implicate in Avio’s aviation activities a group of engineers in Silesia. Avio Polska employs 460 people, including 70 design engineers. I know that Polish engineers have got well integrated into the international structure of the Avio corporation and are up to the task. That is why I am so positive about the ability of Polish engineers to design and work in the space industry. Is this well-qualified staff the result of cooperation with universities and hiring their alumni? We work with universities and we plan to continue such cooperation without settling for a single project. These are mostly Silesian universities. However, we also intend to strengthen cooperation with the Warsaw University’s of Technology Faculty of Power and Aeronautical Engineering (MEL), Częstochowa University of Technology and Institute of Turbomachinery Polish Academy of Sciences from Gdańsk, namely in connection with the construction of a laboratory near Warsaw. Although we do not yet “draw” graduates from there, but when there is a laboratory, we will probably strengthen cooperation not only in terms of recruitment, but also teaching and training. It is our ambition that students of technical schools can use this laboratory to shape their interests. You are encouraging the transfer of scientific research results to business. We are one of the few companies that know how to combine business and science. This is still a problem in Poland. We are perfectly able to develop a technology and present it in the form of an invention, but when it comes to implementation, it gets worse. In Avio, we first describe what

Innovation that, innovative companies, not only “assemblers”, but also those performing more complex tasks are needed. There is still a long way to go before we achieve the desired result in the cluster policy. The current level of cooperation is insufficient. Unfortunately, there are many companies that just want to reap benefits from their membership in a cluster without giving any­ thing in return. The idea of clusters is probably not fully understood. Today, it is still in its infancy.

we expect from science, then we get a specific design that meets our needs, and finally the idea is put into effect in the process of production. Poland offers industrial facilities for many business sectors. What distinguishes Avio compared to other companies is that we have a comprehensive approach to our tasks. We have a complete business cycle with an idea leading up to implementation. Other companies in Poland perform final assembly. Avio, as a member of the Silesian Aviation Cluster, is a partner of the InnoLot project organized by the National Research and Development Centre. The programme aims to fund the research and development of innovative solutions for the aviation industry. The project is very large with emphasis on technology transfer from science to industry. In the aviation industry quality control is necessary at every stage of a given process. This means that it is no longer enough to have a laboratory because every production site has one. Only high-specialized laboratories are able to bring value added to the industry. Today, industry is much more demanding about science. It is also important that professors are not afraid of having contact with business. Today, they often limit themselves to teaching, business contacts being quite difficult for them. I think it is a huge challenge to change

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things the way universities are not just teaching institutions, but they are also able co-exist in industry. This will result in the emergence of very good, innovative projects. InnoLot is a harbinger of this new approach. Avio is an innovative company, as evidenced by numerous awards. Do you agree that innovation equals research and development? The thing is that laboratories should be built with the consideration of the needs of specific companies. I can see that foreign companies often prefer to build labs using their own resources, without applying for any funds or grants. Today, the largest recipients of innovation funds are universities. They have been given a lot of opportunities thanks to EU funds, but unfortunately they are often unable to produce something instead of concentrating exclusively on teaching. And it is clear that if research bodies have no contact with business, it will be difficult for them to follow the world trends. A new approach to innovation is also about clusters. How do you assess the cluster policy? We are a member of the Silesian Aviation Cluster. This is a new experience for Poland and for Avio Polska too. The standard model of a cluster assumes that a dozen companies come together to exchange their works. For

How would you sum up 2012 and what are the company’s plans for the future? We have been honoured with the title of the Pearl of the Polish Economy, which means that our efforts have won recognition and we are encouraged for the future. For us, the year 2012 is a turning point insofar as we know how the company will develop in the next five years in Poland. Our output is expected to double compared to current levels. In 2013 we will proceed to the construction of our laboratory. We will work in consortium with the Military Aviation Plant in Warsaw and two scientific partners – the Warsaw University of Technology and the Military University of Technology. This consortium will allow Avio to feature even higher in the aviation industry. It is going to be a private academic institution aimed at testing aircraft engines. The decision to create it was inspired by the fact that there is currently no facility that would have appropriate parameters. The Avio Group is facing the situation where most aircraft turbine prototypes have limited access to laboratories across the world. Aircraft engine technologies are developing rapidly and the existing research infrastructure turns out to be insufficient in many cases. That is why we need a new laboratory fitted with parameters which will go beyond those presently available worldwide. There is a dozen such facilities in the world. They perform tests on aircraft turbine prototypes in quasi real conditions. We have assumed the highest parameters in terms of pressure and flow, and in this respect our laboratory is to be the best in the world. The laboratory will not be profit-oriented. This does not mean that the investment will not pay off. ::


New cluster initiatives “Polish Market’s” Lech Pilarski talks to Krzysztof Krystowski President of the Managment Board of the Bumar Group and President of Association of Polish Clusters about clusters and innovations.

Or as here, in Podlasie, clusters producing underwear? Indeed, Poland’s only underwear cluster is located in Podlasie and it also belongs to the Association of Polish Clusters. Why is it so? There are certain traditions which are often connected with the geographical location, with the place, and with the specific qualifications of people. And now, at a certain moment, entrepreneurs, a bit later than their fellow businessmen in Western Europe, are noticing that not only competition is of value on the free market. And this is often a great discovery for our entrepreneurs. Cooperation and coordination operations are also of great value, since they play an immensely beneficial role when it comes to the development of growth and competitive edge. Especially since the impulse strengthening this cooperation is European money. According to the report of the European Commission, when it comes to the level of public funding, Polish clusters differ considerably from the Western European ones, as well as from our Southern neighbours from Central and Eastern Europe. It is apparent that here there is considerable room for supporting these initiatives, and that these initiatives may not be very significant from the perspective of our administrative bodies, but maybe our administration simply still cannot see us.

Why do we need clusters, because sometimes it seems like - there is this word that is fancy, a catchword which is in - “let’s do this!” Well, it is undoubtedly our problem that we have become part of some kind of fashion and therefore for some people we may seem a bit shady as a new institution of selforganisation of business. However, to explain what a cluster is in the simplest possible way: it is cooperation, which is created naturally at the grass roots, cooperation among entrepreneurs, as well as scientific facilities from a particular area supported by the local administration. This means connecting

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three communities: those of business, science, and administration. As it is said, what has 3 legs, stands most confidently, and therefore it seems to me that this was found behind the concept of clusters. By their very nature, clusters are a group of entities working in a specific economic area on a particular geographical territory. It happens very frequently that the basis of these clusters is the tradition of many years, even hundreds of years, of a particular economic activity connected with a particular geographical area. Therefore there are innovative clusters, such as aircraft clusters, or clusters of enterprises in the tourism industry.

And how is the 1st Congress of Clusters in Eastern Poland working out? The initiative which we started a few months ago has aroused huge interest in Polish eastern provinces. I can see a lot of positive energy here, and hope and faith that this part of Poland, pretty much like clusters, has not been appreciated enough. This leads to the conclusion that there is a bright future for these provinces and for entrepreneurs. The congress gathered over 400 participants, which represent both business and administrative communities, with the mayor of Białystok at the head, as well as the representation of mayors of other cities, Mayors, and scientists. The energy that is present here is truly impressive. We want to use this energy, because we have to make a leap, also in terms of civilisation. In my speech during the panel discussion, I compared North-Eastern Poland to Finland with regard to many aspects. Finland went for innovation, for science, knowledge, entrepreneurship, and the development of entrepreneurship on the basis of innovative undertakings. It seems to me that this may be the key to provinces like Podlasie. ::


Infrastructural changes in Poland’s economy in 2012 A typical feature of Poland’s economy is a continuous construction, modernization and repairs on buildings and transport infrastructure. The organization of the UEFA Euro 2012 tournament helped accelerate the development of Poland’s transport infrastructure, but there is still much to be done. Bogdan Sadecki In the period from January to September 2012, Polish economic growth was slower than last year. The gradual slowdown was due to the intensification of factors adversely impacting of household consumption growth, as well as to a high level of general economic uncertainty affecting companies decisions as to business development (investment). In the third quarter (July-September) results achieved by many economic sectors deteriorated. Industrial output was below its level from a year earlier. There was also a decrease in construction and assembly production. The retail sales increased only slightly. However, the pace of sales growth in transport services remained equally high as it was in the first half of the year. In the period from January to September, the national budget revenue amounted to PLN 213,924.2 million and expenditure was PLN 235,046.5 million (i.e. 72.8% and 71.5% respectively of the amount assumed in the 2012 budget act). The deficit totaled PLN 21,122.3 million, which accounted for 60.4% of the plan.

Expenditure on roads and railways The transport infrastructure development in Poland has been accelerated by 3-5 years thanks to the organization of Euro 2012. Some of the projects undertaken in the run-up to the championship are still pursued, and the wave of investment which turned Poland into a large construction site has not subsided yet. More than 200 infrastructure projects have been completed. The modernization of infrastructure was in fact one of the goals of the tournament’s organization in Poland. It was hoped that the preparations for the event would accelerate the modernization of the country, strengthen Poland’s image abroad, build social capital, and help acquire expertise and experience for the future.

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Thanks to a number of public investment projects the construction industry managed to survive the hard times, though some large companies went bankrupt. Poland has become the largest construction site in Europe, with some of the projects being still underway. Ongoing and completed infrastructure projects will serve Polish people for a long time. The network of motorways and expressways has been extended. We already have 1572 km of motorways, which represents a 126% increase compared to the 697 km from before the championship. The length of expressways has increased from 339 km to 1122 km, up by 260%. Infrastructure projects carried out in connection with Euro 2012 have tangible benefits because as they helped enhance the economic productivity and the country’s image abroad. Minister of Transport Sławomir Nowak said that by 2015 PLN 43 billion will be spent on the construction of new roads and PLN 31 billion on the modernization of railways, including PLN 26.5 billion on the modernization and repairs of railway lines, PLN 3.5 billion on the purchase and repairs of rolling stock, and PLN 1 billion on the renovation of railway stations. In the years 2008-2011 about 600 km of railway lines were upgraded, in 2012 - approx. 1,000 km, and the plan for 2013-2015 is around 4,000 km, approx. 1330 km a year. The modernization of the key north-south connection, E-65, is being finalized so that in 2014 passengers be able to travel from Gdańsk to Kraków and Katowice on new Pendolino trains at a speed of 160-220 km/h. It is planned that 474 km of motorways and 335 km of national roads will be put into service by the end of 2015. In 2014 a tender

will be announced for the S7 expressway between Kraków and Warsaw, and in the following years, between Rzeszów and Lublin, between Warsaw and Białystok and others. By the end of 2012, a tender will be announced for the completion of the bypass of Poznań. A new road will be opened by the end of this year between Kraków and Tarnów, and by 2014 the whole A4 motorway. For the Tuszyn-Pyrzowice part of the A1 a tender is to be held in 2013. Minister Nowak said he was looking for extra-budgetary financing for this project. He pointed out that the completion of the A1 could be financed under the Polish Investment programme announced by the Prime Minister. According to Minister Nowak, in 2012, the National Road Fund will spend on investment projects about PLN 18-19 billion, in 2013 - PLN 15 billion, in 2014 - PLN 8 billion, and in 2015 - PLN 2 billion. The gap between Polish railways and Western European railways is estimated at at least 30 years. Even if all the resources allocated to Poland under the current EU budget perspective (2007-2013) were used, the gap would narrow by 10 years only. The aims are modest: to get rail lines lying in transport corridors to be able to achieve the speed of 160 km/h for passenger trains and 120 km/h for freight trains (on the Warsaw-Gdynia part of the E65–200 km/h). Against the background of Western Europe and China where high-speed railways (300350 km/h) are fast developing, these are no great achievements. In the third quarter of 2012, railway carriers transported nearly 157.5 thousand units, which is equivalent to 255.7 thousand TEUs. This represents an increase by 21% (or 22.4% for TEU) compared to a year earlier. In total, almost 470.4 thousand units (or approx. 20 thousand less than throughout the whole 2011) were transported in the third quarter of 2012. The volume of goods in intermodal transport amounted to 5.877 million tonnes (in the first three quarters of 2012), an increase by 41.9% compared to the same period last year, and the transport performance was 2.276 billion tkm, a significant increase by 30.3%. The share of intermodal transport


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infrastructure if it is not properly connected to the network of other transport sectors. It is crucial for the quality of air transport that regional and local airports are easily accessible through the road infrastructure and public transport, including railways. Whether the transport infrastructure is made up of appropriate components determines the availability of communication, which is seen as one of the main factors influencing its competitiveness. The Ministry of Transport predicts that by 2015 investments in air transport infrastructure will be about PLN 4.2 billion, including more than PLN 2.9 billion from EU funds.

Fuels According to a report by the Polish Organization of Oil Industry and Trade (­POPiHN), the consumption of the three major types of fuels in three first quarters of 2012 amounted to 17.5 million cubic meters, which means that it fell by 6% year on year. After three quarters of 2012 a decrease in domestic demand for most types of fuel was registered. The exception was LPG and heavy fuel oil. This was the result of an economic slowdown and high fuel prices, and was also influenced by the informal economy, which tends to flourish in times of recession. A small downturn was expected in the market in the first quarter of 2012 due to the change in excise duty on diesel, high fuel prices and low temperatures during the winter months. The scale of decrease in consumption foreseeable for the whole year 2012 comes as an unpleasant surprise. The total consumption of liquid fuels in Poland in the period from January to September fell by 6%, motor gasoline by 4%, diesel by 8%, LPG by 3% (data from PAP).

Not much from the EU for Polish science and infrastructure EUR 200 million will be allocated for 74 projects selected by the European Commission

to be implemented under the Trans-European Transport Network (TEN-T) programme. Among those 74 projects there are 4 Polish projects, the extension of the airport terminal in Gdańsk (EUR 1.7 million) and the modernization of the railway line WarsawGrodzisk Mazowiecki (EUR 1.3 million). Thus, Poland will receive only slightly more than EUR 5 million. “The European Commission continues to support the construction and upgrade of European transport infrastructure to ensure its citizens can reap the benefits of a complete, safe and modern network. Moreover, the almost EUR 200 million made available today will also help to support employment in the EU by allowing Member States to continue investing in large and small infrastructure projects during a time of general economic stagnation,” said the EU Commissioner for Transport, Siim Kallas. Researchers will receive funds too. The European Research Council (ERC) has selected 536 early-career top researchers across Europe. Among the selected candidates there is one Pole. With grants of up to EUR 2 million per project, this will enable the most promising scientists to develop their best ideas at the frontiers of knowledge. Since its inception in 2007, the ERC has funded over 3,000 top researchers across Europe with substantial grants worth more than EUR 7.5 billion. To date, only 12 Poles received the grants. As a comparison, Hungary won 29 grants and Finland - 51. The main beneficiaries are the United Kingdom (700), and Germany and France (over 400). “In a global knowledge economy we need new ideas to compete. So investing in world-class frontier research and in the next generation of scientists is one of Europe’s top priorities. After just five years ERC grants are world-renowned, and help us retain and attract the best of the best,” said EU Commissioner for Research, Innovation and Science, Máire Geoghegan-Quinn. ::

Transport in the period January-September 2012 :: Total

341.9 million tonnes

:: Railway transport :: Hire or reward road transport :: Transport via pipelines :: Cargo freight by sea :: Cargo handling in ports :: Means of public transport :: Road transport :: Air transport :: Railway transport

170.4 million tonnes of cargo 124.7 million tonnes of cargo 39.4 million tonnes of oil and oil products 5.4 million tonnes 42.1 million tonnes 538.6 million passengers 328.1 million passengers 5.5 million passengers 204.3 million passengers


inside the country went slightly up compared to the previous year. By the end of the third quarter of 2012, it was 23.1% against 20.5% in 2011, as measured by transport performance. In 2012, sea freight of containers grew in volume, accounting for 24.5% of the total number of shipped units, up from below 23% in 2011. The share of intermodal transport in the rail market, at the end of the third quarter, stood at 3.44% (by volume) ​​ and 6.26% (by performance). Intermodal rail freight in the third quarter of 2012 was carried out by 7 licensed operators, i.e. DB Schenker Rail Polska, CTL Logistics, PKP Cargo, PKP LHS, Lotos Kolej, Rail Polska and STK. According to the Minister of Transport, in 2013 the government will allocate PLN 2.6 billion on railway development projects. During the Railway Congress Sławomir Nowak insisted that one of the main aims is to improve the situation of the Polish railway sector through a large-scale modernization of infrastructure so that railway services are comfortable and safe. Sea cargo freight as of the beginning of the year amounted to 5.4 million tonnes (3.7% less than last year), while a 0.6 million tonnes drop (19.7%) was registered in last September. Ports handled 42.1 million tonnes of cargo, i.e. 2.2% less than a year earlier. This was due to a decline in the shipments of bulk liquid cargo - by 24.1% (including crude oil - by 25.5%). Growth was recorded in the handling of containers (13.5%), other general cargo (10.4%), bulk dry cargo (3.4%) and ro-ro cargo (1.4%). Last September sea ports handled 5.8 million tonnes of cargo (25.3% more than a year earlier). In the period from January to September 2012 a decline in cargo handling was recorded in the ports of Szczecin (by 10.3% to 5.4 million tonnes), Gdańsk (by 6.1% to 16.7 million tonnes), Police (by 3.9% to 1.4 million tonnes) and Gdynia (by 3.2% to 9.4 million tonnes). Only in Świnoujście the figures were up (by 13.1% to 8.6 million tonnes). Among the groups with a significant share in total transport, during the first three quarters of 2012, the largest increase in annualized sales occurred in road transport (15.9%) and in the storage and transport support services (by 9.9%). A decrease was recorded in the railway and air transport (by 5.9% and 0.7% respectively). The existence of air transport infrastructure has a positive impact on the economic and social development of regions. In Poland there are currently 12 airports, and their operations provide regions with tangible economic advantages. However, it is not possible to fully benefit from the airport


Sustainable investments

Photo: T. Urbaniak ZMPG-a S.A.

in the Port of Gdynia

Reconstruction of the Port Channel in the Port of Gdynia co-financed by the European Union

Port of Gdynia Authority S.A., acting under the EU SMOCS Project and in cooperation with the Maritime Institute Gdańsk and with the support of partners from Finland and Sweden, has carried out an innovative assessment to determine whether

contaminated but stabilised soil used as the building material for port facilities. As one of its primary responsibilities, Port of Gdynia Authority S.A. creates safe and competitive conditions for ships calling at the port. In times

of fierce global competition, carriers seek opportunities to leverage economies of scale and plan to launch progressively-larger vessels, particularly container ships, on the Baltic. To this end, port basins have to be deepened. Such works, in turn, produce output from the sea bed. The ongoing project looks promising and shows potential for creating new opportunities for using such waste as valuable building material. Significant economic benefits are also at hand. Under the project, the cost of building 1 square-metre of yard is PLN 600, while the cost incurred by the utilisation of the contaminated soil from the port bed could reach PLN 400 per cubic metre. The proposed solution conforms to the idea of a sustainable development, which caters for port needs without doing any harm to the environment, while also producing a beneficial economic result. The presented project is a pilot undertaking which could potentially find application in large projects in Polish ports. :: ADVERTISEMENT

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CE Top 500 report

– giants growing in strength Companies operating in traditional economic sectors - like the energy, petrochemical, machine-building, automotive and heavy industries - still dominate among the 500 largest companies in Central Europe, shows the 6th edition of the CE Top 500 report. Only slight changes are recorded in the group of companies that are at the very top of the league table. Mieczysław T. Starkowski Polish companies still perform very well in the Central Europe league table of the 500 largest companies produced by the professional services firm Deloitte. In 2011, their number among the Top 500 was 167. It was smaller by nine than a year earlier, but this was mainly the result of consolidation on the energy market. The number of Czech and Hungarian companies also dropped. The changes resulted from the fast expansion of Ukrainian and Romanian companies. Their revenues increased on average by 24% and 17% respectively. “There is a noticeable increase in the importance of companies from Ukraine and Romania. Their move up the league table is a result of an improvement in economic conditions and a rise in revenues of these countries’ companies by as much as 20%,” said Patryk Darowski, a manager at Deloitte’s financial services department. “In the first quarter of this year, Ukraine continued its growth at a pace much above the average. However, this growth was slower by 50% than in 2011. Polish companies are no longer recording such rapid increases and drops, which partly shows that our market is more mature.” Poland, however, is still the undisputed leader of the region. Almost three fourths of Polish companies noted a rise in revenue, something they owe to Poland’s large and well developed internal market. Fuel giants – Poland’s PKN Orlen and Hungary’s MOL – are still the largest

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companies in the region. The car maker Skoda ranks third. Fuel and power companies took seven places among the Top 10 largest companies. Last year, companies in the league table recorded a rise in revenues, with those operating in the energy sector having performed much better in this respect than the average. One reason is the growth of raw material prices. Poland’s Lotos company also noted an increase in sales. “The number of companies in the league table operating in the industrial products sector rose to 129. They have an over 25% share in the table. The increase by nine companies is due to very good results recorded by the sector,” Patryk Darowski said. “Its median growth reached 17%, mainly because of the very good condition of the manufacturing sub-sector, which includes chemical and metallurgical companies. The median growth of revenues in the manufacturing subsector reached 22%. It was the second year to see revenue growth in this sub-sector after the industry had been affected more than others by the economic crisis in 2009, recording an almost 25% drop in sales.” Compared to the previous ranking, the number of companies in the retail and wholesale sector increased in 2011 by five to 86. Jeronimo Martins, the owner of the Biedronka retail chain, tops the league table in terms of revenue in this category and occupies 10th place on the list of the 500

largest companies. It again recorded a two-digit growth in revenues. The pace of growth was slower than a year earlier – 21.3% in 2011 versus 30.3% in 2010 – but still much faster than in the crisis year of 2009 when it had amounted to 6.6%. The revenues of the whole retail and wholesale sector rose in 2011 by 6.3% against an increase of 6.7% in 2010. In 2009, the revenues of the sector dropped by 7.2%. The performance of the TMT (technology, media and telecommunications) sector is much weaker. Revenues in the sector went down last year. One of the reasons was the activity of regulators. It significantly contributed to a decrease in average revenue per unit (ARPU). The TMT sector noted the sharpest drop in revenue – by 3%. One of the exceptions was Asseco Poland, a Polish IT company. It moved up from 230th to 156th place in the league table and recorded a 50% growth in revenue. The performance of P4 (Play), a Polish telecom operator, was also strong – it recorded a revenue growth of 29%. However, for most companies in this sector 2011 was not a favourable year. A particularly good example is Nokia, which is losing its race against the competition. Nokia’s Hungarian subsidiary moved down by almost 40 places to 65th place. Its revenue was lower by 38% and net profit by nearly 47%. “PKN Orlen is still the largest company in Central Europe,” says Tomasz Ochrymowicz, partner at Deloitte’s

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financial services department. “It moved further ahead of MOL, its main rival, and generated revenues higher by EUR7 billion. PKN Orlen’s revenues went up last year by 24%. Poland’s second largest fuel producer, Lotos Group, ranked seventh thanks to a rise in revenues by as much as 44%. PGNiG was the only company from the fuel sector to leave the Top 10.” Poland’s chemical company Azoty Tarnów jumped from 416th to 144th place after consolidation with the chemical companies in KędzierzynKoźle and Police. Other impressive improvers are the Czech Republic’s Hyundai Motor Manufacturing, which moved from 149th to 51st place, and Estonia’s Baltic International Trading, which moved from 326th to 136th place. However, the league table arouses mixed feelings. The combined revenues of the 500 largest companies from 18 Central European countries were record high at EUR707 billion, or nearly 13% higher than a year earlier and 11% higher than in 2008, the last year before the financial crisis. But their net profits, which on average went down by 3.5% year on year, indicate that the largest companies in the region started to feel the consequences of the economic slowdown. The results for the first quarter of 2012 show a drop in the average net profit by 5.6%. The companies’ average revenues did grow, but by a mere 4%, that is less by more than a half than in the full year 2011. Less than 63% of the companies for which

Methodology The sixth edition of the Deloitte CE Top 500 report contains a league table of 500 largest companies by revenue. They are grouped in seven sectors: TMT, public sector, pharmaceuticals and health care, consumer goods and transport, energy and natural resources, industrial products, and construction. There are also separate rankings of insurers and banking institutions. The report looks at 18 Central European countries and the league table is compiled based on consolidated company revenues for the fiscal year ending 2011. They are expressed in the euro at average exchange rates. The report also includes data for the first quarter of 2012. ::

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first-quarter data were available recorded increases in revenues. “We are entering the fifth year of the global economic crisis and there is nothing to indicate that it will end soon,” said Rafał Antczak, a member of the Management Board at Deloitte. “Large and strong companies may become the driving force behind the economies if they decide to raise their investment and employment after the consolidation of the market. And such decisions depend on the macroeconomic situation.” Last year saw the continuation of economic growth and was a time of relatively favourable economic situation. Polish and Slovak economies performed strongly, growing by 4.3% and 3.3% respectively, as did the economies of the Baltic states. “One of the factors determining economic growth is exports, especially to Germany, which is the main trading partner for the countries in our region,” said Patryk Darowski. “When the French and German economies weaken the situation of companies in Central Europe deteriorates.” What will the year 2012 be like? Will the Central European countries weather the crisis? The first-quarter results did not allow firm projections. But it was clear that the consumer products sector and transport were faring well. Companies from the energy sector also continued to see high revenue increases. Tomasz Ochrymowicz projects that these sectors will be creating the GDP of Central European countries this year. “The evolution of the crisis is increasingly difficult to analyse from the economic perspective because of the exceptionally strong interventionism on the part of governments and central banks,” Rafał Antczak said. “But it does not seem that the crisis will come to an end soon. Now, in the fifth year of this cycle, one may only wonder how immune to its dangerous waves the economies of Central and Eastern Europe still are.” The Deloitte report also includes data on the banking and insurance sector.

Ranking of banks in CE Top 500 In 2011, Poland’s bank PKO BP kept is position as the largest Central European bank in terms of assets. It was larger than the Czech bank CSOB, which ranked second, by EUR7 billion, or around 19%. PKO BP also generated the highest net profit of all banks in the region – EUR924 million. Poland still had the largest number of banks in the league table – 14. It was followed by the Czech Republic and Hungary, with eight and six banks respectively. Thirty five of the 50 largest banks in the region recorded a rise in net profit in 2011. The average net profit increased by almost 11% against 9.6% for the whole banking sector in the region. This shows that the economies of scale offer a significant advantage to the largest banks. Over 50% of the largest banks recorded a slight increase in assets – by 1% on average compared to 3.5% in 2010. The assets of the whole sector grew in this period by 6.4%. This shows that the largest institutions are not increasing the scale of their operations, but are trying to generate higher profits. Among the Top 10 banking institutions, Hungary’s OTP Bank recorded the biggest drop – it fell from second to fifth place in the ranking, which reflects the problems experienced by the Hungarian banking sector. The Czech Republic’s CSOB and Ceska Sporitelna banks ranked second and third. Apart from PKO BP, the Top 10 banking institutions also included two other Polish banks: Bank Pekao and BRE Bank. The first moved from fifth to fourth place while the latter kept its seventh place in the ranking.

Ranking of insurers in CE Top 500 The leader among insurers was still Poland’s PZU, with five Polish insurers among the Top 10 and 17 insurers in the whole league table. As many as 23 largest insurers made a loss in 2011 while the average change in net profit for the whole group was -3.5%. ::

Invest in Poland

Special Economic Zones: Year round-up The Katowice Special Economic Zone

The Słupsk Special Economic Zone

Number of new permits in 2012: 22-23 Investment promised: PLN 1.5 billion New jobs promised: 1,000

Number of new permits: 3 (2 more planned) Investment promised: PLN 30 million New jobs promised: 100

The Legnica Special Economic Zone

Small Business Special Economic Zone Kamienna Góra

Number of new permits issued up to the end of October 2012: 8 Investment promised: PLN 706.41 million New jobs promised: 496 (+ 2657 jobs maintained)

The Łódź Special Economic Zone Number of new permits issued up to the end of October 2012: 11 (7 still planned) Investment promised: PLN 500.4 million New jobs promised: 845 (including 454 new and 391 maintained)

The Pomeranian Special Economic Zone Number of new permits issued from January to the end of October 2012: 11 Investment promised: PLN690.689 million New jobs promised: 347 (plus 1724.50 jobs declared as maintained)

The Warmia and Mazury Special Economic Zone Number of new permits: 7 Investment promised: PLN 145,341,000 ­m illion New jobs promised:: 249

The Suwałki Special Economic Zone Number of new permits: 9 (2 more planned by the year end) Investment promised: PLN 149,900,000 ­m illion New jobs promised:: 505

Number of new permits from January to October 2012: 4 Investment promised from January until October 2012: PLN 240.5 million New jobs promised: from January until October 2012: 498

The Euro-Park Mielec Special Economic Zone Number of new permits issued up to the end of October 2012: 14 Investment promised: PLN 214,539,680.00 New jobs promised:: 331

The Wałbrzych Special Economic Zone Invest Park Number of new permits issued up to 26 November 2012: 18 Investment promised: PLN 490.41 million Announced new jobs from January to October 2012: 536

The Kostrzyn-Słubice Special Economic Zone S.A. Number of new permits up to 26 November 2012: 6 (1 more permit is planned by the year end) Investment promised: PLN 98,254,000 million Number of jobs announced: 536 (additionally 180 newly-created jobs)

the commissioning and storing of packaging. In connection with the new project, the Company is planning to spend at least PLN 20.8 million by the end of 2015 and to hire no fewer than 35 new employees by the end of 2014. As for Rena, the company is going to build a new building for the production and installation of plastic components used for producing machines for various industries, including photovoltaics. Rena is going to invest at least PLN12.9 million by 31 August 2013 and hire no fewer than 10 new employees, while maintaining the level of employment at 148 by the end of 2018.

The Kraków Technology Park The Talento Consulting Przewrocki sp.j. company has obtained a permit to conduct economic activities in the Kraków Special Economic Zone. It is the 112th permit issued by the Executive Board of the Kraków Technology Park since its inception and the 12th issued in 2012. Talento Consulting provides the FINEUS service to entrepreneurs, which gives companies essential management know-how, alerts them to threats, and submits professional reports along with comments. Taking advantage of FINEUS gives entrepreneurs the comfort of stable growth and allows them to safely manage crisis situations.

Special Economic Zones: new permits

In connection with the planned project, Talento Consulting is going to invest PLN 1,656,000.00 net in the Kraków Special Economic Zone. The project will be implemented in the Kraków-Śródmieście Subzone.

The Starachowice Special Economic Zone

The Łódź Special Economic Zone

The Suwałki Special Economic Zone

Number of new permits issued: 5 Investment promised: PLN 20,357,000 ­m illion New jobs promised: (new): 142

Faller Pharma Packaging Poland Sp. z o.o. and Rena Łódź Sp. z o.o. have obtained permits to conduct economic activities in the Łódź Special Economic Zone.

The Kraków Technology Park

The investment by Faller will involve launching a plant producing packaging for the pharmaceutical industry and providing broadly-understood packaging services,

A permit has been issued to Twin Glass Romanowski Zbigniew, headquartered in Augustów, a producer of windows and window sections. The company declares that it will invest at least PLN 4 million in the Suwałki Subzone and hire at least 15 employees by 31 December 2015, while maintaining this level of employment for a period of 3 years.::

Number of new permits: 12 Investment promised: PLN 174,300,200 New jobs promised: 191

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An (un)banked Pole Prof. Małgorzata Zaleska

The author is a member of the Board of the National Bank of Poland, a professor at the Banking Department of the Warsaw School of Economics (SGH), and a Vice-President of the Finance Committee at the Polish Academy of Sciences (PAN).

Compared to other Europeans, Poles are a nation with one of the lowest banking penetration rates. We are only ahead of the Czechs, Italians and Spaniards in terms of the number of bank accounts per capita. It should be noted that according to various sources, the banking penetration rate in Poland, defined as the number of bank accounts per capita, ranges from 0.7 (figures from the World Bank) to 0.99 (data from the National Bank of Poland). These differences are due, among others, to a different methodological approach. Still, it is hard to explain such a large discrepancy between the data. Arguably, the banking penetration rate would be higher if the statistics accounted for the Poles’ increasing dealings with nonbank financial companies (NBFCs). Given the above, it is legitimate to ask two questions, namely whether it is worth increasing the distribution of banking services, and what is the meaning of the notion of an unbanked person. In response to the first question, it should be stated that a conscious use of banking services is desirable. However, the banking penetration rate should not be equated to the country’s economic development and financial condition, as there is no direct relationship between the level of the country’s development and the percentage of its population availing banking services. For example, the Greeks feature high in the ranking of bank users with almost 3 bank accounts per person. At the same time, Greece has a very low rate of non-cash transactions (about a dozen per year

Greece has a very low rate of non-cash transactions (about a dozen per year per capita). By comparison, in Poland non-cash transactions per capita average over 60, with the banking penetration rate per capita at 0.99. The conclusion is that the mere possession of a bank account does not necessarily point to a high degree of financial activity.

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per capita). By comparison, in Poland non-cash transactions per capita averaged over 60, with the banking penetration rate per capita at 0.99. The conclusion is that the mere possession of a bank account does not necessarily point to a high degree of financial activity. A good parameter of banking penetration can be the number of credit cards or mortgages. Credit card holders are in fact people who have at least one bank account, are aware of the advantages of cashless payments and have enough creditworthiness to be issued a credit card. By contrast, banking penetration should not be measured based on the total number of payment card because about 80% of all cards are debit cards, which are automatically issued upon opening a bank account. In Poland, there are about 7 million credit cards. Considering that there are over 31 million people of working age and after retirement in Poland, the banking penetration rate measured by the number of credit cards is slightly over 22%. Another (long-term) form of using banking services is taking out a mortgage loan. There are 2 million of such borrowers in Poland, so measured using the mortgage-based criterion the rate of bank services distribution is about 6%. It follows that the bank account is a necessary but not sufficient condition to be called a bank user. This is only a starting point to draw a client into the orbit of banking. Getting a client is of course important, but the real challenge is to build a lasting cooperation with them. To this end, it is necessary that benefits are both for the bank and for its clients. Building lasting relationships depends on the type of clients and distribution channels for banking services. Mature and well-off clients are usually more tied to their banks than young clients accustomed to modern distribution channels, especially the Internet. The web has both a lot of advantages and disadvantages, including

In Poland, there are about 7 million credit cards. Considering that there are over 31 million people of working age and after retirement in Poland, the banking penetration rate measured by the number of credit cards is slightly over 22%.

the ability to spread positive and negative information extremely fast. And clients are not always satisfied with the services they are offered. Those who are usually do not comment on their satisfaction, while those who are not can easily express their discontent. Either way, there is no escape from the modern distribution channels for banking services, and, after all, there is nothing wrong with it. We should be aware, however, that banks will increasingly resemble fast food establishments providing clients with mass and standardized sets of services and having difficulty in winning their loyalty. In addition to fast food establishments, there will also be restaurant-like banks. The former will attract clients mainly with the price, while the latter will primarily build on quality. Moreover, having admitted that the banking activity is strongly regulated and there is not much freedom of action, and that other channels of distribution are relatively easily copiable, it appears that the quality of service is practically the only element distinguishing banks from each other. High quality of services, financial literacy as well as prosperity of societies and particular individuals, measured by the mere fact of having employment, are indispensable elements of a conscious use of bank services. ::


A thought-out future History provides ample evidence that nothing makes the present so well as a well-thought-out future. Although bad tongues say that all you can be sure of forecasts is that they never come true, the importance of and the need for strategic thinking remain unquestionable. Preemptive reflection on the future helps optimize everyday decisions and actions, which always bodes well for the future. Even the proverb “Man plans and God laughs” does not deny it. And perhaps God is pleased? Elżbieta Mączyńska untapped. In a way, it is because of the reluctance to plan ahead that can be blamed on the previous regime, but given the passage of time, this can also be associated with an uncritical faith in the reliability of the market. And since the market is assumed to be reliable, forecasts are unnecessary. However, the spectacular global financial crisis proved such an approach to be completely false. The inalienable duty to take care of the future rests on politicians, MPs, governments and economists. As it was pointed out a few decades ago already by Henry Hazlitt of the Austrian School, “the art of economics consists of looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups”. There is, however, no shortage of evidence that the ruling elite often does not respect this, being subjected to the terror of the election cycle. The opinion is, therefore, not ungrounded that politicians are more concerned by the fate of future elections than by the fate of future generations.

The higher uncertainty and risk of error, the more we need long-term strategies. When the world is unpredictable, the primary aim of strategic thinking is to early warn and identify potential development trends and, above all, to focus on the least predictable areas of risks and dangers. Such is the role of strategic research teams, strategic advisory bodies or strategic think-tanks. In Poland, however, their potential is still largely

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The marginalization of strategic thinking is also an issue in certain EU countries and the Western world in general. By contrast, in Asia, and especially in China, a great deal of importance is attached to scientific forecasts and projections. Suffice it to mention “The New Asian Hemisphere”, a book by Kishore Mahbubani, an Asian top political thinker, forecasting a decline of the absolute domination of the West and a gradual taking over by Asia as the 21st century’s world leader. Similarly, the

Club of Rome has recently released a study by Jorgen Randers entitled “2052: A Global Forecast for the Next Forty Years”. The Polish Economic Society (PTE), recognizing the need for strategic thinking, established a few years ago the Forum of Strategic Thought to counteract the danger of the marginalization of strategic thinking. For this purpose, the PTE publishes papers dedicated to strategic thinking, authored i.a. by prof. Antoni Kukliński, the initiator and co-founder of the Forum of Strategic Thought. Referring to the concept of invented tradition encountered in foreign literature, prof. Kukliński forged by analogy the notion of invented future. He argues that “the invented future of the region in 2020 or 2050 is a task as mad as it might seem at first sight. The invented future is the one with new structures and new driving forces behind development processes that are difficult to conceive or inconceivable here and now”. Similar opinions are being increasingly formulated, especially in the context of the recent crisis and its underlying causes. These are deemed to include economic and political short-sightedness and precisely the absence of strategic thinking in the Western world. This is evidenced in a number of publications issued by the PTE, also those advertised in this edition of “Polish Market”. I therefore encourage you to refer to them. ::

The author is Professor at the Warsaw School of Economics and the Institute of Economics Polish Academy of Sciences, President of the Polish Economic Society.

Selected Publications of The Polish Economic Society (PTE) Antoni Kukliński  

In search of New Paradigms Fragestellung is the greatest fascination of my academic activity. I am convinced that the art of Fragestellung is the most important challenge for our mind and imagination. The title of this volume is not accidental. In Search of New Paradigms. In this volume, I am presenting a selection of papers testing the following definition of the concept of paradigm. “The paradigm is a set of questions exploring empirical and prospective reality and a set of methodologies creating the philosophical and instrumental framework of how to answer those questions”. In the interpretations of this definition – in the development of my capacities in the field of paradigmatic thinking – I have found three theoretical and methodological inspirations. The Myrdalian Inspiration, the Galbraithian Inspiration and the Khunian Inspiration. Antoni Kukliński

Julio Lopez G., Michael Assous

Michał Kalecki This book covers the life and work of the exceptional Polish economist, Michał Kalecki. It discusses Kalecki’s theory of the capital economy and offers a well-thought-out review of his output, including major publications on the economy of less-developed countries. The concepts developed by Kalecki gained international recognition at the time when the Keynesian economics dominated economic thought. At the beginning of 1930s, Kalecki predicted many aspects of the effective demand concept, which would later be laid down by Keynes in ”The General Theory of Employment, Interest and Money.”

Ludwig Erhard

Wealth for all  Ludwig Erhard’s book discusses the policy of shaping the social and economic system and its fundamental assumptions, including in particular economic freedom and the competitive market. We are convinced that this book will help gain better understanding of these issues, as well as of the market-economy model adopted in the Constitution of the Republic of Poland.

Paul Davidson

The Keynes Solution Paul Davidson’s book provides a vivid description of the losses that the contemporary economy sustains because of ignoring the theories and warnings of Keynes. Formulated in 1936, Keynes’s opinion on the dangers of the excessive expansion of the financial sector would today seem wisdom after the event: ”As the organisation of investment markets improves, the risk of the predominance of speculation does, however, increase. (…)Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes the bubble on a whirlpool of speculation” (J.M. Keynes, Ogólna teoria zatrudnienia, procentu i pieniądza [The General Theory of Employment, Interest and Money], PWN, Warsaw 2011, p. 139-140). Elżbieta Mączyńska, the President of PTE.

Cultural Monitor

Time for summings-up, time for awards

Important exhibitions

Actors Monika Krzywkowska and Mariusz Banaszewski are among the winners of the Warsaw Felix award for theatre activity for 2011/2012. One of the greatest Polish theatre directors Jerzy Jarocki (1929-2012) received a posthumous Felix award for directing his last play, one based on Juliusz Słowacki’s “Samuel Zborowski” at the National Theatre in Warsaw. The initiator and sponsor of the awards, granted for the first time for the 1998/1999 season, was Feliks Łaski, a patron of culture living in London. Since his death in 2004 the awards have been sponsored by the Allianz Polska insurance company. The contest is organized every year by a different theatre. This year, it was the Edward Dziewoński Kwadrat Theatre.

Michał Batory’s “Posters and Objects” exhibition at the Central Museum of Textiles in Łódź. The works by the world-famous Polish graphic artist will be displayed at the museum until February 20, 2013. The exhibition features 80 large and almost 100 small posters as well as book covers designed by Batory for the Drzewo Babel publishing house. The covers he has designed for Paulo Coelho’s novels have become his trademark for many people. Batory’s works often tread a fine line between the real and imagined world. Wojciech Eichelberger, psychologist, psychotherapist and writer says: “The formal and aesthetic perfection of Michał’s works is striking.” They are so perfect that one may even call them artificial and unreal.”

Gala’s Roses is an important poll, in which the best in culture and show business are chosen by popular vote. It is also one of the most important events in the calendar of the “Gala” biweekly. Among the winners of Gala’s Roses 2012 are Leszek Dawid, the director of the film “Jesteś Bogiem” [You Are God], Borys Szyc for his role in “Hamlet” staged at the Współczesny Theatre in Warsaw, Danuta Wałęsa for her book “Marzenia i tajemnice” [Dreams and Secrets], and Maciej Stuhr for directing the TV show “Smuteczek, czyli ostatni naiwni” [Sadness, or the Last Naïve]. ::

Winners and nominees Feliksy Warsawskie 2012 - Author: Dariusz Kowalewski, source: Theatre Square

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Maurizio Cattelan’s “Amen” exhibition at the Maurizio Cattelan, Centre for Contemporary Art at the Ujazdowski Bez tytułu, 2007 Castle in Warsaw. Important and strong, though relying on very simple means, the exhibition will be on until February 24, 2013. It is the first solo exhibition in Poland by Cattelan, one of the world’s most famous and respected contemporary artists. The exhibition features several of his most recent sculptures. Cattelan has made them to pose questions about our contemporary understanding of death, sacrifice, forgiveness, the origin of evil in man, identity and historical memory. The realism of the sculptures is truly moving. Amazing “Echa Czasu” [Echoes of Time] at the National Opera. The Polish National Ballet offers audiences unforgettable emotions and experiences at the “Echoes of Time” ballet evening featuring works by three outstanding choreographers, with great Baroque and contemporary music. The performances are staged at the Grand Theatre National Opera in Warsaw from November 17, 2012. British choreographer Ashley Page shows here his new work - “Century Rolls” to a piano concerto by contemporary American composer John Adams. Krzysztof Pastor’s ballet entitled “Moving Rooms” to the original music by Alfred Schnittke and Henryk Mikołaj Górecki impresses the audiences with its expressive dance. The last piece of the ballet evening is “Artifact Suite,” a virtuoso work by American choreographer WilPage liam Forsythe, to the music by Johann SePastor Forsythe bastian Bach and Eva Crossman-Hecht. :: wieczór baletowy

projekt: Jacek Wąsik | zdjęcie: Ewa Krasuska | na zdjęciu: Dagmara Dryl i Maksim Woitiul

Jerzy Stuhr, outstanding Polish film and theatre actor, teacher and writer, has received the Golden Sceptre Award from the Millennium Bank and the Polish Culture Foundation. The laureate received the award in recognition of his activity as teacher, his work in film and theatre, his moving and inspiring roles as an actor and his reflective memoirs. By Jerzy Stuhr’s decision, the Little Sceptre, an award intended for the young generation, went to Marek Lechki, the director of the excellent film “Erratum”.




Fot. Markus Tretter; courtesy of Maurizio Cattelan’s Archive

Cultural Monitor December 2012 Maciej Proliński recommends.

Cultural Monitor

We recommend new CDs: Łukasz Kuropaczewski, “Nocturnal” – Polish Radio The third album by Łukasz Kuropaczewski, a classical guitarist and one of the most outstanding musicians of the young generation, features refined compositions and interpretations. Those who have never listened to classical music may come to love it if they listen to this album. The album includes “Concerto for Guitar, Orchestra and Kettledrums” by Polish contemporary composer Krzysztof Meyer, performed together with Kuropaczewski by the Polish Radio Chamber Orchestra Amadeus under Agnieszka Duczmal, and two outstanding pieces by other 20th-century composers: Antonio Jose’s “Sonata for Guitar” and Benjamin Britten’s “Nocturnal after John Dowland op 70.”

Marek Grechuta, “Marek Grechuta” – Agora The four-disc album marks the 6th anniversary of Marek Grechuta’s death. It is an attempt to show the most interesting moments in the career of one of the most outstanding Polish singers, composers and lyricists. The archival photographs and personal reminiscences by Magda Umer render the spirit of the times when the artist created his brilliant songs. The album features “Marek Grechuta’s Golden Hits” and songs from his albums “In the Raspberry Brushwood” and “Magic of the Clouds,” the concert with Krystyna Janda “Meadow,” and the poetic film “Procession” on DVD.

Andrzej Waligórski, “Jeszcze tu jestem” [I’m Still Here] – Polish Radio It is a double album released to mark the 20th anniversary of the death of Andrzej Waligórski, an outstanding lyricist and author of satirical texts, well known from cabaret Polish Radio 3. All the texts on the album have been written by Waligórski. The first disc contains archival recordings by various performers, including monologues by Waligórski himself, and songs sung by Olek Grotowski and Tadeusz Chyła. The second disc contains a concert by the Elita Cabaret, with which Waligórski worked for years. The concert was held May 6, 2012 in tribute to Waligórski.

Kim Nowak, “Wilk” [Wolf] – Universal Music The duo of the Waglewski brothers, sons of legendary Polish rock musician Wojciech Waglewski, accompanied by guitarist Michał Sobolewski, has never sounded as expressively as on the second album they released as the Kim Nowak rock band. The musicians are still seeking inspiration in the rock music of the late 1960s. But they have not given up simple riffs and “garage” playing tinged with blues. The album also includes

ballads. The best example is the astonishing duet with the icon of Polish popular music Izabela Skrybant Dziewiątkowska, a singer of the Tercet Egzotyczny band.

T.Love, “Old Is Gold” – EMI The double album of T.Love, one of the most interesting Polish rock bands, is an attempt to show audiences the sources of rock’n’roll. The band’s frontman Muniek says: “The album is based on the old, rough, dark blues of Muddy Waters, country and folk climates in the spirit of Cash and Dylan and the sounds known from the Tamla Motown record company.” Although T.Love’s new songs are quite distant from those compositions, it is clear what has inspired them.

Ania Dąbrowska, “Bawię się świetnie” [I’m Having Fun] – Jazzboy Ania Dąbrowska is one of the most distinctive singers on the Polish music market, on which she has been present for quite a few years now. Her new songs are a return to the roots of a good pop ballad – melodious compositions and clear but climatically refined sounds bonded together by her strong distinctive voice. As regards lyrics, it is a fine story about maturity. Two young, but already experienced, producers supported Dąbrowska in making the album – Kuba Galiński and guitarist Olek Świerkot.

MashMish, “MashMish” – Universal Music MashMish is a duo of singer Gosia Bernatowicz and pianist Marcin Kuczewski. Their first album is eclectic, nut comprehensible. It features songs in three languages: Polish, English and Spanish, with many allusions to pop and soul. The album also reveals the musicians’ search for their own style. The duo do not shun interesting experiments, combining elements of various music genres, like for example flamenco and r’n’b. The compositions and their club sounds will certainly appeal to those who want to dance to the music.

Krajewski & Piaseczny, “Zimowe piosenki” [Winter Songs] – Sony Music It is a Christmas album, though one containing no carols, by Seweryn Krajewski and Andrzej Pia­seczny, a popular Polish singing duo, with brilliant multi-instrumentalist Mateusz Pospieszalski. “Mateusz is a strong personality and he has left a distinctive mark on this material,” Piaseczny says to sum up their joint work. Pospieszalski arranged Krajewski’s melodious and airy compositions in a colourful manner and with a great sense of tradition. In his arrangement, one can hear fascination with classical music, jazz and folk music. Attentive listeners will also recognize in the album his voice, flute and saxophone. They will certainly be glad to hear the orchestra he has recruited for the recording – one made up of the best Polish jazz players.

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No crisis for unfaltering art In 2012 the Polish State spent almost PLN 2.9 billion on culture. “We can talk about a record amount for the last 16 years,” says Minister for Culture and National Heritage Bogdan Zdrojewski. Did we, following this amount, in the year coming to an end, take part in a momentous and important journey, founded on cultural reflection as the most important part of Poland’s modern capital? - wonders Maciej Proliński.

Katowice has been outstanding German conductor Alexander Liebreich. In my opinion, the most important musical event of this year was the 8th edition of the international “Chopin and His Europe” festival. The pillar of the festival was the participation of extraordinary pianists with no other than Martha Argerich in the front seat!

Real music stars, for different genres are coming to Poland Investments

Photo: courtesy of the Museum.

Construction of the Museum of the History of Polish Jews

For Poland, 2012 is still a year of vast investments, primarily in cultural infrastructure neglected over the years. In September a new Opera and Concert Hall in Białystok inaugurated its presence - one of the largest Polish cultural projects in recent years. It cost in excess of PLN 220 million. Its construction was co-financed by EU funds, the Ministry of Culture and the Podlasie province budget. A multi-cultural centre was created for the region and the entire country. Also in September the founding stone was set on the site of one of the largest projects in Gdańsk - the Museum of the second World War. The museum will be a contemporary facility in its form as well as in its exhibitions and research. It will facilitate popularising WWII knowledge and nurturing the memory of its victims and heroes. In Warsaw, the construction of the Museum of the History of Polish Jews entered a decisive stage. It can already be admired in the heart of the

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old Jewish quarters - at the meeting point of ul. Anielewicza and ul. Zamenhofa, the site of the Warsaw Ghetto of WWII. The museum is supported by donors from all over the world. In July USD7 million was donated by Taube Foundation for Jewish Life and Culture and the Polish billionaire, Jan Kulczyk, was generous with PLN20 million. That concluded the collection of donations for the main exhibition. The Museum’s official opening is scheduled for the 20 October 2013.

Poland has always been a country with music as its showpiece We are continuously represent on the international arena. This includes good Polish bands, good Polish vocalists and most importantly, excellent Polish composers. New concert halls are appearing, we have very talented teenagers. Our artistic dialogue with the rest of the world is good. As of September of this year, the head of the leading Polish orchestra - The Polish National Radio Symphony Orchestra in

Björk - Icelandic icon of contemporary music - performed at the Opener Festival promoting her new album. A real happening of this festival was another - third in its history - joint performance by the master of Polish avantgarde - Krzysztof Penderecki together with Jonny Greenwood, the Radiohead guitarist. Peter Gabriel - one of the most notable creators of modern rock and folk - came to Poland for the second time. This time the British musician was a headliner at the Life Festival. As always, our country is host to the biggest contemporary jazz artists. Last year these included: Branford Marsalis, Jan Garbarek, Ravi Coltrane, Ernie Watts, Herbie Hancock, Dave Douglas and Joe Lovano.

World-class Polish music! Musical consolidations, intergenerational get-togethers and artistic challenges - all these happened during “Męskie Granie” 3rd concert road trip which takes place in summer every weekend in the largest Polish cities. “Męskie Granie” - an original Polish product, the largest pop-culture festivals in Poland, being host mainly to foreign stars, to my ear became an important, powerful and on the other hand unpretentious event on our home scene. This year, the festival, under a new artistic leadership (Wojciech Waglewski was replaced by Kasia Nosowska) and for the first time with female vocalists in on equal terms with the male vocalists and musicians (e.g.: Monika Brodka, Julia Marcell, Kasia Nosowska) unquestionably maintained its quality! Tomasz Stańko - our trumpeter and composer, who has been acclaimed by “The New York Times” and “Down

Beat” as one of the best jazz improvisers in the world - has put together an album dedicated to the memory of the Polish Noble Prize winner, Wisława Szymborska, who passed away earlier this year. The album was recorded in June at the Avatar Studio in New York. The album will be published by the prestigious German label ECM, with which Stańko has been involved for the last few decades. Its premiere is scheduled for January 2013. We await this record... But the past year was also rich in many interesting novelties. An unprecedented album by Krzysztof Penderecki and British rock guitarist Jonny Greenwood was published under the Nonesuch label. The composers were accompanied by Aukso Chamber Orchestra - one of the most illustrious chamber orchestras in Europe under the baton of Marek Moś. Deutsche Grammophone label issued the 4th album by Rafał Blechacz - the winner of the 15th International Fryderyk Chopin Piano Competition. The young Polish pianist performed the lesser known, but beautiful works by Karol Szymanowski and Claude Debussy. Blechacz’s rendition was noble and authoritative, which may be surprising if we realise how young an artist he is. The year 2012 is also the year for new studio records by Polish rock legends - such as Voo Voo, T. Love, Hey and Kazik na Żywo. These are intelligently rocking albums where next to real artistic mastery, ease and real unadulterated joy of music is evident. And hot on the heels of their performance and competencies are artists from the young generation. The best example of which is the second album “Kim Nowak” - where Polish artists are finding inspiration in the rock music of the 1960s. In doing that they are not forgetting the simple, characteristic guitar riffs and sounds tinted by hints of punk and blues. And they retain their own character.

Cinema which takes the viewer seriously New creations by Agnieszka Holland “In Darkness” and Wojtek Smarzowski – “Rose” have premiered in Poland. “In Darkness” is a film telling the tale of Leopold Socha, a Pole who during WW II hid Jews from the Warsaw Ghetto in the sewers. This role was personified by one of the most talented Polish actors - Robert Więckiewicz.

Photo. Kino Świat


Holland is one of the most important ambassadors of film art across the world. For years she has been creating bold and often “charitably painful and provocative” cinema. However, this time she created an immense film. “Rose” depicts the post-war story of Tadeusz, a soldier of the Home Army (AK), who in summer 1945 finds his way to the widow of a German soldier in Mazury. Agata Kulesza and Marcin Dorociński play the main characters. This is Smarzowski’s 4th film and definitely the most complete. And its finale is simply proof, that the Polish artists, in his love story, experienced a miracle, which in the history of world cinematography only happened a few times to the select few - Chaplin or Tarkowki. And this is no exaduration.

Two Warsaw exhibitions... “Art Is Everywhere. Academy of Fine Arts in Warsaw 1904–1944” - the exposition emphasising the links between art and everyday life and the role of art in pre-war Poland was on show in Warsaw’s Zachęta National Gallery of Art in summer 2012. This was most probably the largest exhibition remembering the output of the academy in the history of our country. But most importantly, this was a vast positive message, highlighting the significance of tradition and continuity, which is created by the history of every institution, particularly academies training future creators of art and culture. At the same time, the National Museum in Warsaw - one of the oldest art museums in Poland celebrated its 150th anniversary with

an extraordinarily interesting exposition: “The Exalted. From Pharaoh to Lady Gaga”. This exhibition in a very clear manner presented the mechanisms for creating prestige of people in power or aspiring to such, from hierarchical societies of days gone by to today’s media based civilisation. Both events were proof, that art is the best “material” - a direction understood by a nation, by many nations... A simple plot to communicate with the world.

Scene from the “ In Darkness” film

Direction Asia! Korea’s cultural programme prepared by the Adam Mickiewicz Institute within the scope of Project Asia working together with the largest Korean festivals (such as: Seoul Performing Arts Festival (SPAF), or Busan International Film Festival (BIFF) was the most significant undertaking presenting our art outside our country in 2012. Rich, interdisciplinary programme encompassed 60 events and presented, amongst others, Polish cinema, jazz, theatre, dance, classical music and design. Over 100 artists took part. Polish projects shown in Seoul, Busan and Jara island were seen by almost 70 thousand spectators! The Adam Mickiewicz Institute hopes to make an impression with our cultural presence in the entire East Asia region. And this year’s projects have been prepared with the thought “what will remain”. If there is strong infrastructure and geography of contacts, on the level of individual international cultural exchange entities, Polish art also in that corner of the world will be strong. :: 12 /2012  ::  polish market  ::  73


The Knights of Malta in Warsaw Great works of art and priceless documents illustrating the stormy history of the Order of Malta and its current activities make part of the exhibition “Around the Maltese Cross” that can be visited at the Royal Castle in of Warsaw until 13 January 2013. The Prince and Grand Master of the Sovereign Military Order of Malta Fra’Matthew Festing and Polish Minister of Culture Bogdan Zdrojewski are the honorary patrons of the exhibition. Maciej Proliński

The exhibition is devoted to the history of one of the oldest orders of chivalry and one of the most prestigious European organizations. The Order of Malta was founded in 1113 by Gerard de Martigues and played a significant role in the history of Europe, including the

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establishment of the first hospitals in mediaeval Europe. The Knights Hospitaller came to Poland in the first half of the 12th century. Their first commanderies were set up in Lower Silesia. The Association of Polish Knights of Malta was established in 1927 under the leadership of Count Bogdan HuttenCzapski. After World War II, it continued to operate in exile, and it was not until 1992 that it returned to Poland. Fra’Matthew Festing, the Grand Master of the Order of Malta, insisted during the opening ceremony that the inauguration of the exhibition coincides with two important anniversaries: the 20th anniversary of the first convention of the Polish Association and of the resumption of diplomatic relations between the Order of Malta and the Republic of Poland, and almost 900th anniversary of the recognition of the Order by Pope Paschal II in 1113.

The exhibition puts a strong emphasis on the Order’s links with Poland and Warsaw. The exhibited works include portraits, suits of armour, coatsof-arms, distinctions of the Grand Masters, elements of Knights’ weapons, rare melee weapons, silver, family trees, original items of equipment of the Knights’ hospital, as well as paintings and prints, thematically related to the history and the mission of the Order. Thanks to the commitment and support of the Sovereign Military Order of Malta and its embassy in Poland, “Heritage Malta” and the Association of Polish Knights of Malta for the first time unique objects are presented in Poland from the collections of the Magistral Palace and Magistral Villa in Rome, from the Fine Arts Museum, the National Library and the Grand Master’s Palace in La Valletta, Malta. “For the first time in history, we have the opportunity to see many objects from the museum in Rome, both in chronological and cross-cutting configuration. I believe that this exhibition will deepen our historical knowledge about the activities of the Order,” said Prof. Andrzej Rottermund, Director of the Royal Castle in Warsaw. The exhibition has also become a pretext for reflection on the role of the Order of Malta, whose members conducted a comprehensive medical and social work activities. The Knights built the legend that still arouses admiration, inspires and encourages to get involved in charity. “Noble goals that the Order of Malta set itself from the very beginning of its existence were reflected in a committed and full of sacrifice service in Warsaw during World War II. Assistance provided to thousands of the sick and wounded, regardless of nationality or religion, to civilians and soldiers, is one of the brightest points of the history of our city. Today, too, the Association of Polish Knights of Malta plays an important social role across the country by organizing medical centers and looking after the most needy. Warsaw remembers it!”, emphasized Warsaw’s Mayor Hanna GronkiewiczWaltz during the inauguration of the exhibition.::

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Awards for socially responsible businesses Philanthropy in Poland grows in significance every year. Companies not only establish foundations, but also implement social programmes. The phenomenon is not confined to large corporations. It is also true about small businesses that do have an impact on the development of local communities. The winners gala crowning the 6th edition of the Leaders of Philanthropy competition was held on November 6, 2012 at the premises of the Warsaw Stock Exchange. Maciej Proliński Panelists during the dissucion

Laureats of the “Leaders of Philanthropy”

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Photos: Szymon Pulcyn

Statuette of the “Leaders of Philanthropy”

The Leader of Philanthropy 2012 title was awarded to PZU - in the category “company which has donated the biggest budget for social projects in the previous year” - with the amount of donations at PLN 20,728,950 and Atlas Group - in the category “company which has donated for social projects the largest percentage of its pre-tax income” - having donated 7% of its EBT. This year, for the first time in the history of the competition, awards were also handed out in four sectoral categories. In the sector “banking, finance, insurance” the leaders were PZU (in terms of quantity) and Bank BGŻ (in terms of percentage). In the category “consumer goods” the Leaders of Philanthropy 2012 became Procter and Gamble DS Polska. In the category “telecommunications, services, retail, entertainment,” awards went to Orange Polska (quantity) and Job Safety (percentage). In “fuels, power generation, mining, chemical production,” the leaders were KGHM Polska Miedź (quantity) and Atlas Group (percentage). The Awards gala was accompanied by a debate with senator Prof. Alicja Chybicka and Presidents of the winning companies. The participants of the Leaders of Philanthropy competition donated to charity a total of PLN 82,899,417 in the previous year. Donations made by the top ten companies in the category “company which has donated the biggest budget for social projects in the previous year” amounted to PLN 76 million. As regards the “percentage” category, charitable contributions made by the top ten companies

averaged 2%. To sum up, Polish businesses have no doubt played a role in setting a certain standard with respect to social responsibility and maintain this standard. Minister Henryk Wujec, advisor to Polish President Bronisław Komorowski congratulated the laureates. “By acting responsibly - in a civic spirit - you are changing our reality and I thank you for that. When I went on a visit to the United States just after Poland embarked on a democratic transition 23 years ago, I was amazed to discover the portfolio of American charities. I didn’t imagine at the time that we would ever catch up with their standards. And here we see it come true,” he said. Mr Wujec also stressed that he was very pleased with the fact small businesses wanted to take responsibility for their local communities and to make donations to philanthropy, along with the biggest nationwide companies. Piotr Szczepanski, President of the Donors Forum, the organizer of the competition, said: “Philanthropy is not just about funding. Corporate giving has also a strong social aspect, including business confidence building, as well as cooperation and coresponsibility in local communities. All that contributes to social development. The analysis of the previous competitions shows that corporate philanthropy is developing among both large and small companies. Many of the companies participating in the competition have their own corporate foundations that fulfill their social objectives in a professional manner. On the other hand, there are also companies that decided not to set up foundations, which is no obstacle for them to successfully implement large social programmes, often in collaboration with specialized non-governmental organizations that offer relevant knowledge and experience. It is also worth emphasizing that an important role in corporate philanthropy is played by micro-enterprises that operate locally and influence their immediate communities.” ::

The numbers that describe us: Buses –1300 low-floor buses including 950 high-capacity vehicles Buses used in traffic – 1090 Daytime routes – 147 Every day, our buses travel approximately 250 thousand kilometres. · T  he Municipal Bus Company (Miejskie Zakłady Autobusowe) is the largest municipal transport operator in Poland and one of the biggest in Europe. · F or 92 years we have provided our Passengers with transportation in buses of top global brands, including Chausson, Chevrolet, Mercedes, MAN and Solaris

Hybrid bus – one of the four in the fleet of Company

· T  he top quality of services has always been our priority – we were among those who pioneered the use of air-conditioned buses (the latest batch of our buses is equipped with “Mediterranean” air-conditioning), next stop voice announcement, a passenger information system available on and outside of the bus, and an information system for people with visual impairment. · O  ur rolling stock is among the newest in Poland – in the last five years we have procured 775 brand-new buses. · W  e operate four hybrid combustion buses and have run traffic tests of alternatively fuelled buses, including electric ones.

The 1500th Low floor bus


Patricia Popławska – a woman of business

Few people in Poland can boast such excellent business intuition. It was this unique quality that has allowed President of Clarena Patricia Popławska to create one of Poland’s largest cosmetics companies.

For fourteen years now, Clarena has manufactured top-quality professional cosmetics and specialist-treatment equipment, opening several thousand beauty parlours across the country, one third of which use Clarena products only. The company’s portfolio includes a vast array of innovative cosmetics for home use and auteur beauty

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treatments. Its products have reached 19 European countries, and the brand is expanding very quickly on international markets. In 2012, Clarena opened two representative offices abroad - in Brussels and London. September saw the launching of the Official Online Shop on for customers from Poland, which was followed

by a venue opened for EU clients two months later. Each outlet offers expert assistance –clients can consult a cosmetologist, choose optimum skin treatment and buy the right products. Professionalism and consultancy constitute the two vital foundations on which Clarena’s success has been built. These premises, as well as hard work and outstanding business intuition, have allowed Patricia Popławska, the President, to turn a small drugstore in Wrocław into a major enterprise. Her market awareness and keen commercial sense can be acknowledged by the prestigious awards she has received – their list is long and continually expanding. Just over the last few months Clarena has been awarded four important distinctions. It was the second time for the brand created by Patricia Popławska to be selected the Luxurious Brand of the Year, while in the ranking of Instytut Nowoczesnego Biznesu it received the titles of Business Cheetah and Effective Company. No wonder then that Clarena’s President is regarded as one of the most influential women in Lower Silesia. In addition, Patricia Popławska actively engages in initiatives aimed at supporting and recognising local businesses. This year, she joined the Jury of the Griffin of Lower Silesia Business Award, the first woman ever in this honorary group. In recognition of its international successes, Clarena has also been invited to the pilot edition of the Polish Champion programme. This unique project affiliates Polish business leaders with notable achievements on foreign markets. ::

Clarena is one of the largest Polish producers of professional cosmetics. Present on the market since 1998, it has specialised in serving beauty parlours. Clarena provides high-quality care products, dermocosmetics and specialist treatment equipment. Its package also comprises innovative cosmetics for individual clients and auteur care treatments. Products are sold through a network of licensed partner outlets. The company is active abroad, currently reaching 19 European countries and continuing brand expansion onto new foreign markets. Clarena has been awarded numerous distinctions, including the Luxury Brand of the Year in 2011 and 2012, Beauty Expert 2010 (LNE & spa), InStyle Best beauty BUYS 2010, Beauty Premium 2010, the Business Cheetah 2012 and the Effective Company 2012.

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2013 to see 100 New Businesses The Businesswomen Embassy Foundation has inaugurated the “100 New Businesses in 2013” Project, which is to give rise to new businesses run by women and create new jobs.

Krystyna WoźniakTrzosek during the speech

On 23 November 2012, the Ministry of the Economy hosted the launch of the “100 New Businesses in 2013” Project, which will be pursued by the Businesswomen Embassy Foundation in cooperation with several other institutions operating in areas driven towards growth in the economy, entrepreneurship and professional inclusion. The Project forms part of the social campaign entitled “Partnership for Advancement in Female Entrepreneurship”, which is to help create a positive image of entrepreneurship. “100 New Businesses in 2013” is another milestone on the agenda set by the Businesswomen Embassy Foundation in September 2012, following the nomination of 100 Female Entrepreneurship Ambassadors in Poland. “Economists keep reminding us that the establishment of small

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companies is a vital measure for surviving and overcoming the economic crisis,” commented Urszula Ciołeszyńska, President of the Businesswomen Embassy Foundation and a Female Entrepreneurship Ambassador for Europe. “Small and medium-sized businesses do not only provide their founders with jobs and profit but also create jobs for others. Our Project focuses on helping women to set up their own businesses. Women who qualify for the Project will be given a chance to pick one of the three available programmes, namely Franchising Systems, Coaching Groups, and Social Economy Units. At present, we are finishing the compilation of assets and qualifications offered by our Female Ambassadors, which will allow us to customise the support targetted at participants in each individual programme. Our estimates show that by the end of 2013 our work can generate 100 new businesses.” The Franchising Systems Programme will be open to women determined to start a business managed in line with trusted and verified methods, developed by already-operational companies. Potential franchisors will include selected companies run by Female Ambassadors and other franchises operating on the market. The next programme – Coaching Groups – is targetted at women who can demonstrate they have a business idea but who need an in-trade specialist to put it into practice. Participants in this programme will be taken under the wings of the Ambassadors, acting as their mentors, and will be given the opportunity to attend a series of training sessions organised under the Female Leader Academy scheme. This programme will seek assistance from Provincial Employment Agencies. The third programme devised for participants in the 100 New Businesses in 2013 Project is called the Social Economy Units. Under this programme, the Ambassadors initiate

social cooperatives, thus creating new jobs for other women. So far the 100 New Businesses in 2013 initiative has been seconded by, the Ministry of the Economy, the Polish Agency for Enterprise Development (PARP), and the Polish Confederation of Private Employees (PKPP) Lewiatan. “We have been engaged in talks to win the support of all the possible partners in public institutions, local-government units, social organisations and business,” added Urszula Ciołeszyńska. “In a joint effort under the Partnership for Advancement in Female Entrepreneurship, we wish to build a positive image of entrepreneurship as a driver of new jobs. Besides the human capital contributed by the Ambassadors, the establishment of 100 new businesses next year will call for funds we plan to secure from the EU and governmental programmes aimed at the development of SMEs and female inclusion, as well as business partners interested in co-hosting the Project. The contribution from institutions with access to funds earmarked for the promotion of entrepreneurship, combined with involvement on the part of participant sponsors, will help us devise bottom-up solutions to make it easier for women to establish and manage their own businesses in a sound and steady manner.” The inauguration of the 100 New Businesses in 2013 Project featured the Female Entrepreneurship Ambassadors who had set up and managed their own businesses. In addressing the audience, they recounted their experiences of their first steps in the business world, explained how they had overcome obstacles in their way, and threw in a handful of useful advice for other women. Another highlight was a speech by Krystyna Woźniak-Trzosek, Editorin-Chief of “Polish Market” monthly and President of the Board of Oficyna Wydawnicza Rynek Polski Sp. z o.o. “I founded my company 16 years ago. Earlier on, during a visit I paid to my friends in England, I encountered some publishing houses oriented towards the promotion of England and its economy. I remember myself realising that in Poland we lack such

Events Audience read the “Polish Market“

magazines. I returned to Poland with that thought in mind. In 1996, having already had some experience in the trade and working as Editor-in-Chief at different economic magazines, along with a group of friends, I devised a concept and launched “Polish Market” – an economy-oriented monthly published in English. This is how it came to help us globally support Poland, its economy, science and culture, and has done so for over a dozen years now. Now, you ask me what my advice is for all you ladies here. Well, statistics show that 75% of women work for reasons considered as economic necessity. But many of these women add that even if they had a choice and did not have to work, they would engage in economic activity anyway. It leaves

me thinking that if the only desire behind setting up your own business is finding a way to earn money, then you better think twice. If, on the other hand, your wish to run your own company has roots in passion, faith, and determination, then – even if your goal seems elusive – go for it! It is not so long ago that people believed that if a businesswoman were to stand equal to men, she had to outperform them at least twofold. I myself believe that this statement has lost its validity. Women have shown that they do just fine in managing companies, while also having the so-called “soft” characteristics, such as an open attitude and ability to tackle conflicts. Mind you a professionally-accomplished woman is a happy one!” ::

Photos: Rafał Nowak

From left: Agnieszka Przybysz ( Coaching Institute), Aleksadnra Łukomska Smulska (European Union of Women’s) and Krystyna Woźniak- Trzosek (Polish Market)


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Photos: Ewa Jasińska


Export challenges for Poland Ten years of cooperation within the Association of Polish Exporters was an opportunity to organize an anniversary congress. The 10th Congress of Polish Exporters took place on November 19, 2012 at Warsaw Marriott Hotel. Its main topic was the prospects for the growth of exports, which is the driving force of the economy and a factor increasing Poland’s share in the international division of labour. Maciej Proliński The anniversary Congress of Polish Exporters was attended by over 200 participants, including 150 exporters from all business sectors and regions. Among the guests of honor were Stanisław Kalemba, Minister of Agriculture and Rural Development, Viktor Gaisenk, Ambassador of Belarus to Poland, Marek Ociepka, Head of Trade and Investment Promotion Division at the Embassy of Poland in Moscow, Paweł Pietrasiński, Head of Trade and Investment Promotion Division at the Embassy of Poland in Washington, and Janusz Pieńkowski,

The Minister of Economy sponsored financial awards for the following laureates of the competition Outstanding Exporter of the Year 2012: :: BALTON Sp. z o.o., Warsaw – 1st Award of the Minister of Economy in the form of a Grand Prix Statuette and PLN 20,000 :: Mistral-Elast Sp. z o.o., Lódź – 2nd Award of the Minister of Economy worth PLN 10,000 :: FM BRAVO Sp. z o.o., Olsztyn – 3rd Award of the Minister of Economy worth PLN 10,000

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Head of Trade and Investment Promotion Division at the Embassy of Poland in Paris. Minister Kalemba said: “This year’s anniversary congress falls in the year in which we will achieve a record result in foreign trade in agri-food products. It is a huge success of Polish food producers, the success all the greater that agri-food is the only industry to have steadily generated a positive trade balance over the years. The agri-food sector is one of the most important drivers of the Polish economy. All indications are that this year the trade balance will for the first time exceed EUR 3 billion, and Poland will export EUR 16 billion worth of agrifood products. This means that one fourth of Polish production is exported, but jobs remain in Poland. This success was possible thanks to many years of hard work, the EU investment funds, and above all, a good cooperation between producers, processors, exporters.” He also pointed to the need to continue efforts to maintain the upward trend. In his view, one of the biggest challenges is to consolidate

agri-food producers and deepen cooperation with the processing and trade industry. “Globalization processes compel both horizontal and vertical consolidation among producers and processors. It is necessary to enhance relationships between these two groups,” argued Minister Kalemba. The primary goal of the 10th Congress of Polish Exporters was precisely to specify actions necessary to turn the Polish economy into an innovative and export-friendly one, something that gives a chance to quickly overcome the economic crisis. The participants stressed the need to take steps that are likely to help tackle real problems and needs of Polish exporters. This may be achieved thanks to the effective implementation of business support measures, contained in the “Pro-Export Development Strategy for the Polish Economy” compiled by the Association of Polish Exporters. This document is a comprehensive concept paper defining the basic assumptions, goals, and export-oriented government policy guidelines until 2020. The strategy names industries that are of crucial importance when it comes to exports: the automotive, electronics, aerospace, biotechnology, information services, telecommunications, R&D and agri-food sector. With regard to geographical priorities, the strategy mentions the European Single Market, the eastern neighbouring countries: Russia, Ukraine and Belarus, as well as the U.S. and Asian

Events markets: Japan, China, India, Indonesia and Malaysia. The authors also point to the need for a systemic change in the overall pro-export policy, including the instruments supporting Polish exports. They recommend a tripartite structure composed of the Export Development Council under the Ministry of Economy, and two bodies yet to be established, namely the Agency for Export Development that would also report to the Minister of the Economy and the Polish Eximbank, a public institution created on the basis of the BGK and KUKE SA to handle export transactions.

In the second part of the 10th Congress the Final Gala was held of the competitions “Outstanding Exporter of the Year 2012” and “Economic Journalist of the Year 2012”, during which several major Polish exporters and 10 outstanding economic journalists were presented with Congratulatory Letters, Titles and Cups by the Association of Polish Exporters. Among the awarded journalists was, not for the first time, Krystyna Woźniak-Trzosek, President of Oficyna Wydawnicza Rynek Polski Sp. z o.o., Editor-in-Chief of “Polish Market”.::

Krystyna Woźniak- Trzosek presents the award From left prof. Ryszard Michalski, Director of Institute for Market, Consumption and Business Cycle, Mieczysław Twaróg and Paweł Pietrasiński - Trade&Investment Section of the Embassy of the Republic of Poland in Washington

Congratulatory Letters, Titles and Cups “Outstanding Exporter of the Year 2012” by the Association of Polish Exporters for the Exports Products of the Year 2012 (HIT) were given to the following exporting companies: :: Okręgowa Spółdzielnia Mleczarska, Oleśno :: Quadrum Foods Sp. z o.o., Kraków :: KMS Food Sp. z o.o., Gdańsk :: Borcox s.c. Małgorzata i Wiesław Borowy, Maków Podhalański :: Motyl s.c. Zakład Produkcji Narzędzi Ściernych, Lublin :: Gambit-Lubawka Sp. z o.o., Lubawka :: PPUH Horus-Energia Sp. z o.o., Sulejówek :: Staco Polska Sp. z o.o., Niepołomice :: Pojazdy Specjalistyczne Zbigniew Szczęśniak Sp. z o.o., Bielsko-Biała :: Chłodnia Olsztyn Sp. z o.o. :: Okręgowa Spółdzielnia Mleczarska, Pajęczyn :: Przedsiębiorstwo Produkcyjne Infinity Group Sp. z o.o., Olsztyn :: Splast Sp. z o.o., Jedlicze :: Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A., Grzybów :: Impexmetal S.A., Warsaw :: Malow Sp. z o.o., Suwałki :: Szynaka Meble, Lubawa :: Grupa Alumetal S.A., Kęty :: Grupa Kapitałowa Inter Groclin Auto, Karpicko :: Zakłady Mięsne Łmeat-Łuków S.A. :: Spółdzielnia Dostawców Mleka, Wieluń :: Suempol Sp. z o.o., Bielsk Podlaski :: SuperDrob S.A. Zakłady Drobiarsko-Mięsne, Karczew :: FagorMastercook S.A., Wrocław :: Wojskowe Zakłady Uzbrojenia S.A., Grudziądz

Congratulatory Letters, Titles and Medals “Outstanding Exporter of the Year 2012” by the Association of Polish Exporters were given to the following exporting companies: :: Grupa Animpol Sp. z o.o., Gorzów Wielkopolski :: PPUH Komirex Sp. j., Siemiatycze :: Cantoni Motor S.A., Bielsko Biała :: Fabryka Parafin Naftowax Sp. z o.o., Trzebinia :: P.P.H. AMG Sp. z o.o., Lębork :: Ankol Sp. z o.o., Chorzelów :: Przedsiębiorstwo Arkop Sp. z o.o., Bukowna near Olkusz :: PPH „Mandam” Sp. z o.o., Gliwice :: P.P.U.H.Sor-Drew Rajmund Sorowski, Świętochłowice :: Zakłady Azotowe w Tarnowie-Mościcach SA :: Fabryka Łożysk Tocznych – Kraśnik S.A., Kraśnik :: MMI Sleeping Sp. z o.o., Biskupiec :: Ronal – Polska Sp. z o.o., Wałbrzych :: Hortino Zakład Przetwórstwa Owocowo Warzywnego, Leżajsk :: Mokate Sp. z o.o., Żory :: Fabryka Kotłów „Sefako” S.A., Sędziszów :: Tele-Fonika Kable Sp. z o.o., Kraków

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Food industry

Even the best encounter problems Meat and its products have become Poland’s flagship exports. The results are amazing: since 2004 meat exports increased more than 3-fold, and poultry meat exports more than 12-fold! Even now, in a period of economic downturn, a double-digit growth in meat exports continues in most markets. Interview with Janusz Rodziewicz, President of the Association of Polish Butchers and Producers of Processed Meat.

It is probably a good time for the 90th anniversary of the oldest organization of the Polish meat industry, isn’t it? I can confirm this from the perspective of the Association which has about 200 members, mainly medium-sized meat processing plants, most of which combine slaughter and processing. It is because the ideal we strive to achieve in this industry is the technological chain “from the feed to the table”. Probably enhanced by quality control systems at each stage? It is obvious, but increasingly more attention is paid to the promotion of our products. This year, we have completed the second EU programme in this field and we have already got a positive decision of the European Commission as to our participation in the next promotional programme directed at Russia, China and the United Arab Emirates. It is a three-year programme worth PLN 20 million, basically continuing the previous activities. This goes in line with our belief that the effectiveness of promotion depends to a large extent on the consistency and perseverance. This is especially true of the customers from the East, who take a long time to get used to and appreciate new products, but then you can count on their impressive loyalty. I think that export permits for poultry and pork that we have recently received in China and in Ukraine are for many producers a tangible success of these promotional programmes. Still, we want to make the meat exports expand further. One of the main problems facing the Polish meat exports is that meat processing plants are dispersed and

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have difficulty in crossing a criticalmass point when it comes to the size of supplies. Is it easier to solve this problem when being a member of the Association? We use a number of ways to solve such problems. For example, we have managed to ensure that export permits are granted also to cold stores that are able to integrate several plants which alone would not be in a position to handle a large order. After this solution proved to be effective in exports to Korea, I hope it will be so with exports to China too. The Association serves as an initiator here, but the logistics falls within the capacity of individual companies. It is important to maintain the stability of supplies, and we can do it. Despite a falling pig population, the volume of pork exports has been sustained. It is easier to achieve with poultry and beef, because in this case we have a sufficient volume of domestic production.

As you can see the export success has many fathers - both producers and processing plants, and all those bodies that provide them with organizational and promotional support, including the Polish missions abroad we work closely with. Won’t the recent decision of the Constitutional Court regarding the non-compliance of the ritual slaughter with the Polish Constitution undermine the stability of supplies? We were persuaded that the EU legislation prevails in this respect and that it is the EU that decides on such matters. Yet, it turned out that it falls with the competence of national legislations, and that amendments must be made to the Polish law to make ritual slaughter possible, something we are lobbying for. It seems that this virtually eliminates kosher or halal production in Poland, doesn’t it? At the moment, a clear and final interpretation have not been provided yet. The vacatio legis usually lasts quite a long period, and here it is very short and, on top of that, it comes at a bad time with foreign contracts being already concluded. In 2011, Poland exported 265 thousand tonnes of beef worth over EUR 800 million, 30% of which came from ritual slaughter. Of 1.4 million tonnes of poultry 500 thousand tonnes went for export, 10% of which was slaughtered according to the religious requirements. Ritual slaughter is done by several plants that hold special licenses. Yet, we have to remember that ritual slaughter is not only for the purpose of exports, but also to cater various religious groups. It further implies a problem of Jewish (and, to a smaller extent, Islamic) tourism to worship centres in Poland. So all those who want to come to Auschwitz, Lelow or Leżajsk must be told “take food with you”? I am almost sure that together with meat producers and processors as well as the Ministry of Agriculture we will manage to sort out this problem quickly.::

Wesołych Świąt! MLEKOVITARadosnych, spokojnych, pełnych ciepła i nadziei Świąt Bożego Narodzenia oraz wszelkiej pomyślności i osiągnięcia sukcesów w nadchodzącym 2013 roku życzy Prezes Zarządu Grupy MLEKOVITA

Dariusz Sapiński

Food industry

And yet – what a fine time it was! The anniversary year of the Association of Polish Butchers and Producers of Processed Meat is drawing to a close.

provided grants for another promotional programme, which will be implemented by SRW RP from 2013 in selected third countries over the next three years.

Bożena Skarżyńska

Photo: Bożena Skarżyńska

The anniversary was an occasion to refurbish the SRW RP head office, which is now even more frequently visited by the members and supporters of the organisation. This year the head office has also become the venue for a number of miniconferences and meetings. It was also here that SRW RP’s National Council made the key decisions on industry events. In March these included the Easter Meeting, during which prizes were awarded to the winners of Easter competitions, and the first SRW RP 90th-Anniversary Medals were handed over.

At the beginning of this year people spoke of 2012 with some concern, expecting it to be a tough one for the meat industry. It has definitely been far from easy. Polish meat companies have faced the difficult task of surviving in the months of the crisis, which has manifested itself primarily in weakened demand on the consumer market. On the other hand, balance has partly been restored by the growing meat and processed-meat exports to EU and third countries. The Association of Polish Butchers and Producers of Processed Meat (SRW RP) started the anniversary year celebrations in January. For the whole of 2012, through a variety of activities, the organisation has been telling the story of its 90-year-old tradition. The first of these anniversary events was the New Year’s Day Meeting in the SRW RP headquarters in Warsaw. Sharing the wafer, the members of SRW RP wished each other luck, a wish that acquired an entirely new meaning in the context of the SRW RP’s anniversary. To address people’s concerns for the future and provide entrepreneurs with some

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solutions to stay afloat in times of the crisis, the Association held two conferences entitled “Effective cost management in meat-processing plants”. The first two-day meeting took place in February in Dolsk, Wielkopolskie Province, and was attended by numerous directors. Interesting economic solutions were suggested by Prof. Andrzej Pisula, Stanisław Gwiazda, Kazimierz Dąbrowski, PhD, and Stanisław Kwiatoń, PhD – scientists from the Warsaw University of Life Sciences – SGGW in Warsaw. The second meeting was held in the same place in June. The above-mentioned lecturers were joined by Prof. Mirosław Słowiński from SGGW and Prof. Edward Pośpiech from the University of Life Sciences in Poznań. In February the members of SRW RP took part in an exhibition of food in Moscow. It was also the last event to feature a stand promoting meat and its products within the framework of the EU-funded “European Table” programme. It had been a three-year-long venture aimed at the promotion of meat in third countries – including Russia, Ukraine, and China. “European Table” was well-received in Brussels. The European Commission has

In spring the members of the biggest organisation in the Polish meat industry did not fail to turn out in large numbers at the promotional event of the Ministry of Agriculture – the “Poznaj Dobrą Żywność” (Try Fine Food) Picnic. The numerous stands promoted pork, poultry, and beef products, and also horseflesh and lamb. The official SRW RP 90th-Anniversary event took place in June. It was held in the Jasna Góra Monastery, where several hundred people – association members, their families, and guests – attended a Holy Mass, followed by an official gala. The anniversary event was organised in the open, at the foot of the ruins of a 14th Century castle in Olsztyn near Częstochowa. Another notable event was Świętomięs Polski (Polish meat festival) a two-day promotional fair, hosted this year by Silesia. In 2013 a similar large-scale meat-themed picnic is due to take place on the Polish coast – in Gdańsk. The SRW RP’s participation in the PolagraFood 2012 exhibition in Poznań was also one of the organisation’s last grand anniversary events. To date, numerous individuals active in and cooperating with SRW RP have been honoured with medals and diplomas on the occasion of the 90th Anniversary. It would be difficult to provide an exhaustive list of all the events connected with the anniversary and the participation of the association’s members in important industry events. It has been a year of hard work, and the next one – because of the economic situation and also the extensive promotional plans – promises to be equally interesting. ::

Food industry

Organic farming in Poland Maciej Bartoń The romantic beginnings of organic farming in Poland It is believed that the father of Polish organic farming was Rudolf Steiner. He was born in 1861 in the small town of Kraljevec in present-day Croatia. He studied in Vienna and later in Rostock. It was there that he developed a fascination for the literary and scientific legacy of Goethe and became one of its most valued scholars. Goethe’s work on phenomenology and life engrossed him most, as Steiner saw in this work the only right approach to the method of studying the world, and traditional science allowed the understanding of “only inanimate objects, while the phenomenon of life is beyond its reach”. He was the one to introduce the biodynamic method of cultivating land in Poland. He spoke of this unusual method in 1924 in Kobierzyce near Wrocław, where he presented a series of lectures on the biodynamic method. The eight lectures under the common

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title of “The Spiritual Foundations for the Renewal of Agriculture” were delivered in the palace of the von Keyserlingks. Steiner pointed out the global trends of chemicalization in agriculture and suggested an alternative way. He believed that the basis for real agriculture is healthy soil, which he treated as a living organism. The lectures were attended by landowners, who started to put his thoughts into practice. Count Stanisław Karłowski, Senator of the Second Republic of Poland, applied this method from 1930 on his estate in Szelejewo near Gostynin. However, the outbreak of World War II thwarted all agricultural development plans.

Revival Organic farming returned in the early 1980s, when the first course of this method was organized in Warsaw (1984) by what was later called the Ekoland Association of Organic Food Producers based in Przysiek near Toruń (registered on 1 September 1989). In 1990 Ekoland conducted an inspection of farms and granted its first organic farming certificates to 27 farms. This number grew with time and so did the area of agricultural land covered by organic farms. In 1996 the first independent certifying body – Agro Bio Test – was established, and in 1999, after many years of attempts and negotiations, the Ministry of Agriculture disbursed the first subsidies to compensate the farm-inspection costs and granted aid per hectare of cultivated land to organic farmers. However, it was not until 2001 that organic farming in Poland was given a legal basis – on 16 March the Polish parliament passed the Act on Organic Farming, which laid the foundations for the proper functioning of the organic-products market. Currently, after Poland’s accession to the European Union in 2004, we are bound by the EU regulations on organic farming. That moment marked the beginning of the rapid development of organic farming in Poland – from 555 controlled farms

with a total area of 11,000 hectares in 1999 to over 23,800 organic farms operating on over 573,000 hectares in 2012. If it were not for the effort and dedication of many unsung heroes of those times, the present-day Polish organic agriculture would not be in so good a condition. Yet we cannot stop and rest on our laurels. What, then, should we do next?

Quo vadis, organic farming? Organic farming and organic food are trendy subjects in Poland these days. A survey published by TNS Polska in early October indicates that 30% of consumers buy organic food. The vast majority of Poles – 62% - understand the notion of organic food as food produced without the use of chemical agents. Certificates are little known among Poles, a conclusion which is confirmed by the “Learn about Health Food” study commissioned by the Minister of Agriculture. That is why so many people find it difficult to tell organic food from conventional or traditional food and not to get it all mixed up. Surveys also indicate that it is the better taste and smell that persuades consumers to buy organic food – 42% of respondents. Other reasons for purchasing organic food can be grouped as “health-related”. The data published in “The World of Organic Agriculture” report shows that Poles spend an average of EUR23 a year on organic food. This is a very poor result in comparison to the other European countries. The ranking is led by Switzerland and Denmark, whose residents spend EUR153 and EUR142 respectively. Organic farming is more than just a system of land cultivation – it is also a quality-assurance system. An organic farming certificate gives consumers certainty that the food they buy is top quality. The national programme for promoting organic food will be starting by the end of this year and is due to feature celebrated Polish actors and athletes. Let’s hope that such campaigns will help maintain the current pace of development and that more Polish consumers will understand how much of a treasure our organic food is. ::

Grupa Azoty Many companies One aim: WIG 20

Siła Tworzenia

A new, powerful brand on the European chemicals market. It encompasses complementary companies with a variety of traditions and specializations in order to use their potential in implementing a common strategy. This is how we have created Poland’s biggest, and one of Europe’s largest, chemical consortium.

The new structure guarantees us a strong market position both domestically and abroad. We have become Poland’s largest and Europe’s second producer of artificial fertilizers and our products are delivered to over fifty countries worldwide. This growth in sales and market diversification would not have been possible without the modern logistics infrastructure created within the Group.

Thanks to the Group’s well-considered architecture, we are able to offer our clients a diversified product portfolio – from mineral fertilizers and construction plastics to OXO alcohols, plasticizers and pigments. Many of them are recognized brand names with a long history of reputability. The certificates, attestations and numerous industry awards we have received serve as evidence of their high quality. Our own research, development and service facilities also allow the Group to conduct servicing activities.

Our mission is to continue making the Group’s market position stronger, extending its global reach and harmonious development of its companies – our most valuable assets. However, since we know that success comes with responsibility, our new strategy includes not only economic aims and indicators – the principles of sustainable development, meaning care for the environment and local communities are its important part. We are a brand of the highest standards – in every dimension of our operations.

Polish Market No. 12 (195) 2012  
Polish Market No. 12 (195) 2012  

Polish Market” is a prestigious English-language magazine published since 1996. In its pages, it promotes the Polish economy, businesses, re...