WBJ #7 2013

Rostowski new deputy PM

Revving up

Irish eyes smiling

Poland’s finance minister received a promotion in the prime minister’s recent cabinet shakeup

Poland’s car market is looking healthier than many had expected

Ireland’s ambassador explains how his country is digging out of its fiscal hole

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14-15

WWW.WBJ.PL

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VOLUME 19, NUMBER 7 • FEB 25 – MAR 3, 2013 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

LOKALE IMMOBILIA

Since 1994 . Poland’s only business weekly in English

Path to the euro

REAL ESTATE

COURTESY OF ECHO INVESTMENT

Poland’s leaders are making a push to get Poland ready for the euro zone, but with so much opposition and so much to do, euro adoption is still a 13 long way off

• Nowy Mokotów • Europa Centralna • Historic office space 17-18

Welcome rise Industrial production surprised on the upside in January 11

In this issue News . . . . . . . . . . . . . . . . . . . . .2, 5-6 Business . . . . . . . . . . . . . . . . . . . .8-9 Finance & Economics . . . . . . . . . .11 Opinion & Analysis . . . . . . . . . . . .12 Cover Story . . . . . . . . . . . . . . . . . .13 Interview . . . . . . . . . . . . . . . . .14-15 Lokale Immobilia . . . . . . . . . .17-18 The List . . . . . . . . . . . . . . . . . . . . . .19 Markets . . . . . . . . . . . . . . . . . . . . . .20 Sports . . . . . . . . . . . . . . . . . . . . . . .21 Lifestyle . . . . . . . . . . . . . . . . . . . . .22

¸UKASZ MAZUREK/WBJ/SHUTTERSTOCK

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

Civil union wedge

Fiscal pact passed

The issue of civil unions could tear the ruling party apart

The Sejm has approved the EU’s fiscal compact treaty

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NEWS

www.wbj.pl

Numbers in the News

EU-Ukraine partnership talks

1.5 million is the number of Poles who have been living abroad for at least a year, according to the latest census figures.

z∏.7.9 billion is how much companies in Poland spent on advertising in 2012, down by 5.2 percent compared to 2011, according to data released by media house Starlink.

Ukraine, Poland, Lithuania to create peacekeeping team

Leszek Miller, leader of the Democratic Left Alliance, on why Poland should ratify the EU’s so-called fiscal compact (see story, p. 6).

Figures in focus Hard-earned money Minimum wages in selected EU countries (in €, as of January 2013) 2,000 1,500 *Highest in the EU **Lowest in the EU 1,000 500

February/March FEBRUARY 28 FACILITY & PROPERTY MANAGEMENT CONFERENCE

Location:

Web:

Panels on fire prevention, reducing a building’s maintenance costs and improving the safety of users and the environment.

Airport Hotel Okecie ul. 17 stycznia 24, Warsaw Konferencjafm.pl

ar y Re pu bli c Lit hu an ia Ro ma nia **

Cz ec h

Hu ng

Source: Eurostat

Company index Location:

Web:

senting works by the late Jerzy Nowosielski.

DESA Unicum auction house ul. Marsza∏kowska 34-50, Warsaw desa.pl

12-15 MIPIM

AIG/Lincoln ............................................17 Air China ..................................................9 Alcatel ....................................................11 Alstom ....................................................11 AMD ........................................................23 APA Kury∏owicz & Associates................18 Auchan....................................................11

Web:

The world’s leading real estate event for property professionals.

Palais des Festivals, Cannes, France MIPIM.com

18

PRCH RETAIL TRENDS SEMINAR

Carrefour ................................................11

Event:

During the seminar experts will discuss the latest trends in the field of research, development and investment in shopping centers and retail chains.

Warsaw Mariott Hotel Aleje Jerozolimskie 65/79, Warsaw PRCH.org.pl

CD Projekt RED......................................23

Event:

Location:

Bank Millennium......................................2 Bank Zachodni WBK ..............................11 Blizzard ..................................................23 Boeing ......................................................9 Bungie ....................................................23

French telecommunications giant France Telecom said that it wrote down €889 million in impairment costs on its Polish subsidiary Telekomunikacja Polska (TP) in 2012. The writedown on TP comprised the bulk of the French group’s total impairments of €1.84 billion, which also stemmed from units in Egypt and Romania. ●

an d

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Jacek Ciesnowski

ain

But the EU’s list of demands is long. “The European Union is committed to signing the association agreement, provided there is determined action and tangible progress on the three key issues: selective justice, shortcomings of the October elections and advancing association agenda reforms,” said Mr Füle in February in Kiev.

Ukrainian officials bristled at the comments. The country’s ambassador to the EU, Kostiantyn Yelisieiev, said he didn’t understand why such conditions are imposed on Ukraine and not on the EU’s other partners.

Calendar

Event:

TP costs France Telecom big

in an interview with InterfaxUkraine.

The relationship between the EU and Ukraine has been strained in recent months, so much so that EU-Ukraine summit planned for 2012 did not even take place.

Nevertheless, EU representatives are hopeful ahead of the upcoming summit.

“2013 is a year of opportunities. It is a year not only to intensify the relations between Ukraine and the European Union, but also to strengthen the political, economic and legal base of our cooperation,” said EU Commissioner for Enlargement and Neighbourhood Policy Stefan Füle.

Po l

Leaders taking part in the EUUkraine summit that starts on Monday in Brussels will try to put Ukraine back on track to closer cooperation with the EU, but the task will prove tough.

The imprisonment of Yulia Tymoshenko, a former Ukrainian prime minister, will once again prove crucial in negotiations. The EU considers her incarceration politically motivated.

“The issue will be discussed at the summit, as it is impossible to move forward in the EU-Ukraine relations before the problem of selective justice is eliminated,” head of the EU delegation to Ukraine, Ambassador Jan Tombiƒski, said

“[Not joining the EU’s fiscal pact will] condemn our country to the role of peripheral country, stumbling about on the unpaved roads of Europe. If you don’t understand that, then you don’t understand anything.”

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PKO BP, Poland’s largest bank, is planning acquisitions, the bank’s CEO Zbiegniew Jagie∏∏o told daily Rzeczpospolita.

Taking over a large bank that has a significant presence in cities and a portfolio of wealthy clients would be justified from a business point of view, and Bank Millennium meets these criteria, he said.

Quote of the Week

Lu

PKO BP eying Bank Millennium

0.3% is how much Poland’s industrial production increased in January in year-on-year terms, easily beating analysts’ expectations, according to statistics office GUS.

SHUTTERSTOCK

Ukraine, Poland and Lithuania are planning to create a joint peacekeeping team in 2013, the Defense Ministry of Ukraine has said. “Poland in February officially confirmed that it agreed to work with Lithuania on the creation of a military force and complete forming it this year,” First Deputy Defense Minister Oleksandr Oliynyk told a press briefing on Thursday, InterfaxUkraine reported.

€889 million

is how much French telecommunications giant France Telecom said it wrote down in impairment costs on its Polish subsidiary Telekomunikacja Polska in 2012.

Sp

Former Polish President Aleksander KwaÊniewski has announced that he intends to create a list of center-left politicians who will run for a place in the European parliament in 2014 with his blessing. The former president, still a popular figure in Poland, made the announcement at a press conference he attended with the leader of the liberal Palikot’s Movement party, Janusz Palikot.

IN THE SPOTLIGHT

urg * Be lgi um F r Un an ite ce dK ing do m

KwaÊniewski back in politics

FEBRUARY 25 – MARCH 3, 2013

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FEB. 28-MAR. 1 Event:

Location: Web:

EXPOCHEM

A meeting place for chemical firms interested in buying and selling products and establishing cooperation with foreign companies.

Spodek, ul. Korfantego 35, Katowice Expochem.pl

MARCH 5-9 CEBIT Event:

Location: Web:

The flagship fair for the ICT industry. This year, Poland is the Partner Country.

Hannover, Germany CeBIT.de

Location:

Web:

ART AUCTION

Event:

7 pm: First auction in Poland exclusively pre-

Code........................................................17 Cushman & Wakefield ....................17, 18 Dalkia......................................................11 Dantex ....................................................18 Dom Development ................................17 DONG Energy ..........................................9 Echo Investment ....................................18

21-22 EUROPEAN EXECUTIVE FORUM Event:

Location:

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Citi Handlowy..........................................11

Web:

This conference, entitled “Leadership in Changing Europe,” will examine various leadership issues.

Hotel Sheraton ul. Boles∏awa Prusa 2, Warsaw Executive-club.com.pl

EDF ........................................................11 Elektrim Group ......................................17 Energa ......................................................9 Fiat............................................................8 France Telecom ..................................2, 11 GdF Suez ................................................11 GE Capital Real Estate ..........................17 Grupa Waryƒski ......................................18

Helical Poland ........................................18 Hochtief Development ..........................17 Iberdrola ..................................................9 Konsalnet Holding ................................17 LOT............................................................9 Messer Eutectic Castolin ......................17 Metro-Projekt ........................................17 Microsoft ................................................23 Mindshare Polska ....................................8 Nintendo ................................................23 Nordea Bank ..........................................11 Orange ....................................................11 Peter Nielsen & Partners........................8 PGE ..........................................................9 PKO BP ..............................................2, 17 PKP ..........................................................9 Polimex-Mostostal ................................18 Polnord ..................................................18 Pracownia Architektoniczna Czora & Czora ........................................18 S.A.M.I. Architekci Mariusz Lewandowski i Wspólnicy........18 Sony ........................................................23 Starlink ....................................................2 Telekomunikacja Polska ....................2, 20 Thomson ................................................11 Turkish Airlines ........................................9 Valad Europe ..........................................17 Veolia ......................................................11 Vivendi ....................................................11 Warimpex................................................17 Warsaw Stock Exchange........................18 X-Trade Brokers ..............................13, 20

NEWS

FEBRUARY 25 – MARCH 3, 2013

www.wbj.pl

Government

Changes to NewConnect

Rostowski appointed deputy prime minister But Donald Tusk’s much-awaited cabinet reshuffle left some disappointed

changes in his government might be in store by mid-year.

“Sometimes changes are needed if just to build a new synergy even if you are not critical of a particular minister’s performance. And that is why I ask all who expected an earthquake or huge cadre revolution to be patient,” said Mr Tusk.

A mere manicure Some were very disappointed with the changes indeed.

Adam Hofman, spokesperson for opposition party Law and

“Sometimes changes are needed if just to build a new synergy.”

EUROPEAN PARLIAMENT

The most significant change Prime Minister Donald Tusk made in his cabinet reshuffle last week was to appoint Finance Minister Jacek Rostowski as deputy prime minister. Mr Rostowski, who will still remain finance minister, is known to have the prime minister’s ear, and is seen as a key player in Donald Tusk’s government.

“This is a return to the tradition where the prime minister of a coalition government has two deputies. It is good when there is a balance between coalition partners in a government,” said Mr Tusk at the press conference where he made the announcements.

Mr Tusk also spoke of the importance of issues of public finance at the moment, saying such matters needed “better coordination.” The move doubtless strengthens Mr Rostowski’s position as well as that of the finance ministry itself.

Since 2009 when Donald Tusk relieved his party colleague Grzegorz Schetyna of the position of deputy prime minister, the senior coalition partner Civic Platform has not had its own man in the position.

Jacek Rostowski has gained the post of deputy prime minister and will keep his finance portfolio Jacek Rostowski will now join Deputy Prime Minister Janusz Piechociƒski, the leader of the junior coalition partner, the Polish People’s Party, as joint number-two in the government.

Changes in the interior Jacek Cichocki, now former minister of the interior, will replace the PM’s top advisor

Tomasz Arabski as chief of the permanent committee of the Council of Ministers and head of the Prime Minister’s Chancellery.

In turn, Bart∏omiej Sienkiewicz, who co-created the Centre for Eastern Studies think tank and was an analyst in post-communist Poland’s first intelligence agency, the Office for State Protection,

will take over as interior minister.

Contrary to widespread speculation from the media and opposition politicians, heavily criticized officials such as Health Minister Bartosz Ar∏ukowicz, Justice Minister Jaros∏aw Gowin and Treasury Minister Miko∏aj Budzanowski all held onto their posts.

But Mr Tusk let on that more

Justice, was particularly upset with the promotion of Mr Rostowski, who has earned the reputation of being a particularly stingy finance minister.

“This is a signal to citizens that they will be robbed even more this year,” said Mr Hofman. “We were deceived into believing that there would be big changes and talked about that for a whole week. Meanwhile, all we have is an ordinary manicure, fingernails painted another color,” he added.

Remi Adekoya

Politics

Ruling party under strain over civil unions Prime Minister Donald Tusk, leader of the ruling Civic Platform (PO) party, is reported to have given an ultimatum to more conservative members of his party, asking them to choose between supporting the government’s legislation on civil partnerships and leaving the party.

“Either the conservatives reach an agreement on the civil unions matter, or they’ll be out of PO,” the prime minister said, according to radio station TOK FM. “Civil unions are not a matter of conscience, they are a matter for Civic Platform’s leadership [to decide upon],” Mr Tusk added.

The party is in turmoil over a new civil unions proposal which is to be agreed upon and submitted to parliament for a vote within two weeks. The pre-

vious bill – which would have given same-sex couples some of the same rights that married couples enjoy – fell through when 46 MPs from the ruling party broke from the party’s official line and voted against it on January 25.

When asked if he would leave the party, conservative party member John Godson said, “I don’t exclude such an option but I certainly hope it won’t come to that.”

The new revisions to the proposal change one aspect of the former draft, namely that civil unions be concluded before a notary public and not in the Civil Registry office, thus taking the “marriage” facet of the partnerships out of the equation.

Mr Godson is one of the most unrelenting party members when it comes to civil partnerships. “To me, personally, it’s a matter of worldview,” he told TVN24, indicating he would oppose the new proposal.

Agree to disagree PO member Grzegorz Schetyna commented on his party’s inability to agree on the civil partnerships issue, saying, “In voting on matters such as civil unions, you can’t hide behind your worldview or lack of sufficient discussion.”

He added, “There have been many discussions on the matter. ... There is always a discussion, then it comes to a deci-

sion and it should be executed.”

He explained that when his colleagues voted against their own party’s legislative proposal it was “an unfortunate demonstration of several party members who didn’t realize the consequences of their actions,” he told TVN24.

Jacek Rostowski, finance minister and newly nominated deputy prime minister, admitted that PO has had problems

with its members disagreeing, but that party leadership “knows exactly how to solve them,” he told RMF FM. He stressed that PO was not coming apart. Mr Rostowski added that the situation could be salvaged by “total political cohesiveness combined with a great deal of tolerance and understanding in matters of worldview and ideology.”

Beata Socha

COURTESY OF JOHNGODSON.PL

The prime minister’s ultimatum: support civil unions or leave the party

5

John Godson (right) has been a conservative thorn in Mr Tusk’s (center) side

Starting March 1, at least 15% of company shares to be introduced to trading on NewConnect will have to be held by at least 10 shareholders with an up to 5% holding each.

Companies listed on NewConnect will also have to sign agreements with brokers for a period of three years, instead of one year as is currently the case.

These may only be the first steps, as the bourse is to analyze the market carefully this year and possibly carry out further modifications.

Trade sector in bad condition The trade-sector business climate index, calculated by the Research Institute for Economic Development at the Warsaw School of Economics, dropped by 0.1 point to 9.8 points in the fourth quarter of 2012. This is the lowest it has been in the last quarter of the year since 2000. The survey described the general situation in the sector as negative.

Regulator liberalizes gas market Poland’s energy regulator URE issued a decision saying that gas-trade companies will not have to have their prices approved by the watchdog. There are 97 companies in Poland that have obtained gastrade permits. The decision is aimed at increasing free trade in Poland’s natural gas market.

Agreement reached on Church Fund Poland’s government and Roman Catholic Church officials agreed on a proposal to enable Polish taxpayers to transfer 0.5% of their income tax to a selected church. The new law could come into force in 2014. The regulation could provide the church with about z∏.140 million annually.

This is significantly higher than z∏.90 million the church usually gets from the state budget within the so-called Church Fund. ●

6

NEWS

www.wbj.pl

European Union

FEBRUARY 25 – MARCH 3, 2013

Demography

Poland on course to ratify Poland losing people the EU’s fiscal compact

Biggest winners The PM said Poland had “won the financial battle for the next seven years like no other country in Europe” referring to the recently-agreed 2014-2020 EU budget from which Poland will receive a total of €105.8 billion, making it the biggest beneficiary in the EU. “The positive budget for Poland is the effect of a longterm strategy which assumed, among other things, winning the support of European institutions for the cohesion policy,” said Mr Tusk.

He went on to say that “the fiscal compact implements standards in public finance that will protect the Polish taxpayer and the Polish state from excessive

PiS opposed Unsurprisingly, the conservative Law and Justice (PiS), Poland’s largest opposition party, opposed ratification. Its leader, Jaros∏aw Kaczyƒski, contested the procedure by which it was voted on as well, saying the measure should require a two-thirds majority.

“We completely reject the claim that the fiscal compact does not affect Poland’s independence,” he said. “If it is to be accepted, then it should have to garner a constitutional two-thirds majority in parliament.”

Mr Kaczyƒski said if the vote was not conducted under those conditions, his party

Remi Adekoya

39,000 38,500 38,000 37,500 37,000*

* estimate based on new Eurostat methodology

14 20

11 20

10 20

20

09

08 20

07 20

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37,000 20

would treat it as if it had never taken place. Solidarna Polska, another conservative party, was also against the treaty.

Meanwhile, liberal opposition parties Palikot’s Movement and the Democratic Left Alliance, as well as the junior coalition partner, the Polish People’s Party, all voted to adopt the compact.

Leszek Miller, leader of the Democratic Left Alliance, said not joining the fiscal compact would “condemn our country to the role of peripheral country, stumbling about on the unpaved roads of Europe. If you don’t understand that then you don’t understand anything.”

The fiscal compact will not impose any binding regulations on Poland until it joins the euro zone and it is still not clear when that will happen (see Cover Story, p. 13). The treaty now needs to be approved by the Senate and then signed by the president, both of which are expected to happen without any difficulty.

Poland’s population is about to fall drastically

05

risk. It will be the next step on the road to a safe Europe.”

“I don’t think there is a convincing alternative idea for a safe Poland, an idea that would not involve a strong and safe European Union,” Mr Tusk added. In the 460-member Sejm, 282 MPs supported the treaty, enough to give it the simple majority it needed to pass.

them eventually came back after communism collapsed.

According to new Eurostat methodology, people living outside their home country for at least a year are no longer counted as its citizens. Therefore, when the report is released next year, Poland’s population will show a fall from 38.5 million to AS, JC some 37 million.

About to drop

20

Donald Tusk said Poland was the biggest winner in the 2014-2020 EU budget negotiations

About 1.5 million Poles have been living abroad for at least a year, the latest population census data show. These people are unlikely to move back to Poland, demography expert Professor Krystyna Iglicka told Dziennik Gazeta Prawna.

Ms Iglicka estimates that about 100,000 Poles left the country in 2012 and another 500,000-800,000 will leave over the next five years. This migration is mostly for economic reasons and it’s the poorest regions that lose the highest number of people.

Between 2000-2012, nearly 300,000 Poles left the country, a number equivalent to the population of a medium-sized city.

The age group that most often leaves the country is 20-40 year-

04

The Sejm, Poland’s lower house of parliament, has given its approval to the fiscal compact, an intergovernmental treaty introduced to discipline European governments in their public finances.

The treaty entered into force on January 1, 2013 for the 16 EU members who had already completed ratification.

For subsequent ratifiers, it will enter into force on the first day of the month following the submission of ratification documents with Brussels. Twentyfive of the EU’s 27 countries have pledged to adopt the treaty.

Before the vote, Prime Minister Donald Tusk argued hard for the fiscal compact in parliament last week.

COURTESY OF FLICKR/PLATFORMARP

Polish MPs have given the go-ahead to the treaty despite many dissenting voices

olds, many of whom get married and have children abroad.

This reduces the size of Poland’s population of those who are economically active.

The last wave of emigration with a similar magnitude occurred after the imposition of martial law in Poland in 1981.

In the 1980s, 1.2 million Poles left to live abroad, but most of

20

The latest wave of emigration is the biggest since the end of communism

Source: Central Statistical Office

Charges to be dropped in CIA prisons case?

The prosecutor’s office in Kraków is set to drop charges against the former head of Polish intelligence, Zbigniew Siemiàtkowski, in the case of alleged CIA prisons in Poland, daily Gazeta Wyborcza reported last week.

Mr Siemiàtkowski was accused of aiding a war crime and overstepping his authority in the matter of alleged CIA prisons operating in Poland between 2003 and 2005, where the US intelligence agency is alleged to have interrogated

and tortured detainees accused of terrorism.

Despite the investigation’s “top secret” status, some information has managed to come to light. Mr Siemiàtkowski himself confirmed that charges had been brought against him after Polish media discovered the fact in 2012, some four years after the investigation had begun.

This time, Gazeta Wyborcza cited unnamed sources claiming that the charges against Mr Siemiàtkowski were to be

dropped and that the decision was motivated by backlash major political figures would face had the investigation continued.

“An indictment against the former head of intelligence would lead to charging former Prime Minister Leszek Miller and possibly even former President Aleksander KwaÊniewski,” Gazeta Wyborcza wrote.

“Without their knowledge, such a prison couldn’t possibly have functioned.”

Beata Socha

8

BUSINESS

www.wbj.pl

FEBRUARY 25 – MARCH 3, 2013

Automotive

Shifting back towards growth

Polish car exports are on the rise in that month. While that still represents a 3.49 percent drop y/y, experts had predicted a much bigger drop considering the decline in EU markets.

Car parts in demand The biggest drivers of improvement are car parts and car accessories, as evidenced by data on Poland’s exports to Germany, which accounts for over 31 percent of Poland’s sales abroad of cars and car parts.

And while car production in Germany fell by 5 percent in November, Poland sold 18 percent more car parts to its western neighbor y/y. Total exports of car parts to the EU (which accounts for nearly 81 percent of Poland’s total export volume) increased by

5.96 percent, while sales to other, non-EU markets fell by some 22 percent.

Overall, in the first 11 months of 2012, Poland exported €16.5 billion worth of car products (7.3 percent less than in corresponding period of 2011). The export of car parts and accessories was the only sector where the value increased (by 4.5 percent) and was worth €6.2 billion. The other sectors – cars and car engines – registered drops of 22 percent and 13.4 percent respectively.

Thanks to the relatively good November results, AutomotiveSuppliers.pl predicts that Polish automotive exports in 2012 will come to €17.8 billion (compared to €19.1 billion in 2011).

Jacek Ciesnowski

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

Payment deadlines in commercial transactions On February 8, the Sejm adopted a draft Act on Payment Deadlines in Commercial Transactions and submitted it to the Senate for review. The draft is to introduce legal solutions to discipline contracting parties to exercise shorter payment deadlines and thus to prevent payment defaults in commercial transactions and improve companies’ cash flow performance.

The reasons for the new act are twofold: one reason is the ineffectiveness of the currently binding act on payment regulations, while the other is the EU Directive 2011/7/EU on combating late payment in commercial transactions. The Directive should be implemented before March 16, 2013.

Changes to public procurement law An amendment to the Act on Public Procurement Law came into force on February 20. It introduces to the Polish legal system the Directive 2009/81/EC of July 13, 2009 which specifies the procedures for

awarding work, service and supply contracts by authorities or entities in the field of defense and security.

The amendment introduces a new chapter to the public procurement law with specific regulations on procurement in the field of defense and security. The amended provisions are to ensure greater participation of enterprises in awarding, performing or subcontracting such contracts in Poland.

Sejm approves fiscal pact ratification On February 20, the Sejm adopted the draft Act on Acceptance of Ratification by the President of Treaty on Stability, Coordination, and Management in Economic and Monetary Union, commonly referred to as the fiscal pact. The treaty is to reinforce financial discipline, and to help balance public finances and better coordinate economic policies in the euro zone as well as in countries which are parties to the agreement. The treaty is one of the measures EU is employing to combat the current economic crisis and prevent future ones. ●

BROUGHT TO YOU BY PETER NIELSEN & PARTNERS LAW OFFICE

SHUTTERSTOCK

Last year was disastrous for the Polish automotive industry.

The news that Fiat’s factory in Tychy would lay off 1,500 workers hit the market particularly hard. But the industry seems to be headed for a surprising – and welcome – bounce back.

Poland reported a rise in the number of newly registered cars by 8.8 percent, the second-best result in the EU, behind the UK with 11.5 percent.

Throughout Europe the number of new cars registered dropped by 8.7 percent to 885,200, according to January data from the European Automobile Manufacturers’ Association. This is the lowest figure since 1990, when the association began collecting the data.

Fiat CEO Sergio Marchionne told Bloomberg he expected car makers’ total losses in Europe to come in at around €5 billion for 2012.

But export data in the automotive industry from November herald some improvement in Poland. According to AutomotiveSuppliers.pl, Polish companies exported €1.52 billion worth of cars and car parts

SHUTTERSTOCK

While the European car market slumps, Poland’s automotive sector seems to be doing better

Plenty of employees take undocumented payment in Poland

Employment

Lots of Poles working in gray economy Both employers and employees readily engage in “under-thetable” agreements As many as 47 percent of Poles have relatives or friends who work in the gray economy (in which workers are paid under the table without paying income taxes or social security contributions), according to a study by pollster CBOS. Krzysztof Zagórski, a professor from the Kozminski University and the author of the study, believes that Poles tend to look the other way when cheating the state is concerned, and that it is a much more common occur-

rence than one might expect.

The study shows that 23 percent of respondents know or are aware of people who fail to pay off their loans, and one in five respondents have acquaintances who evade paying some or all of their taxes. A quarter of those surveyed said they know people who have unjustly been granted welfare or unemployment benefits.

But it’s not just private individuals who cheat the state. PKPP Lewiatan, a national employers’ association, conducted a similar study in 2012 which showed that 33 percent of companies in Poland hire employees illegally, 4 percent more than

in 2011. It also turned out that paying workers under the table is extremely common in smaller Polish companies.

Experts say that the increase of pension contributions, a higher minimum wage, and the economic slowdown are the three main reasons for such situation. The sectors in which gray-economy practices are most prevalent are construction and trade.

“A legal job is a luxury good in Poland. You have to pay horrendously high taxes for it,” Piotr Rogowiecki, an expert at Pracodawcy RP, an employers’ association, told daily Rzeczpospolita.

Marta Mardosz

Ad sales continue to fall Last year companies in Poland spent z∏.7.09 billion on advertising, down by 5.2 percent compared to 2011, according to data released by media house Starlink.

Starlink experts attribute the decline to the ongoing crisis in the fast-moving consumer goods market, a slowdown in the pharmaceutical and financial sectors, and changes in the media world.

“On the one hand we are observing a smaller demand for advertising, which derives from the uncertain economic situation in leading sectors of the economy,” said Lidia Kacprzycka, managing director at Starlink.

“On the other hand, however, we have changes in the media market, where digitization is bringing down viewership of nationwide TV stations.

Smaller and lower-cost stations as well as theme channels are gaining, though.”

In 2012 only internet and cinema advertising managed to maintain healthy growth rates, up 8.7 percent y/y and 11.2 percent y/y respectively.

The TV advertising market as a whole shrank by 5.6 percent, with the four biggest broadcasters (TVN, Polsat, TVP1 and TVP2) bearing the brunt of the decline, recording an 11 percent fall in ad revenues.

Theme channels, however, recorded a 12.8 percent increase in advertising revenues.

Dagmara Robak from media house Mindshare Polska estimates that in 2013 television advertising in Poland will shrink by a further 10 percent and print advertising by 15 percent. She predicts that the internet will continue to be the only medium not to experience advertising declines.

If the pace of the decline continues this year, the value of the advertising market will end 2013 below its 2007 level, experts predict.

AS, KW

BUSINESS

FEBRUARY 25 – MARCH 3, 2013

Airlines

LOT to be sold this year?

Poland’s troubled state-owned air carrier LOT could be sold this year, once legal obstacles are removed, the airline’s newly appointed CEO, Sebastian Mikosz, announced last week.

The government has long been looking to offload the loss-making airline, but has had trouble since Polish law requires the Treasury to maintain a controlling stake.

Government officials have already proposed draft legislation to make the privatization possible, and it is expected to pass soon.

But another obstacle to finding a new owner for the airline will be EU regulations that prohibit an entity from outside the EU from owning a controlling stake in any European air carrier. It was these regulations that scuppered LOT’s sale in previous years.

Several potential buyers from outside the EU showed interest in the past, most notably Air China and Turkish Airlines, but due to the restrictions a deal was never struck.

When asked who could buy LOT, Mr Mikosz responded that “the most obvious choice

COURTESY OF LOT

New CEO Sebastian Mikosz wants to have the air carrier ready for privatization before the end of 2013

Previous attempts to sell LOT have failed so far would be another European airline. Although right now they’re not interested in buying LOT, things could change in the future.”

However, most European airlines are struggling with problems of their own.

According to the International Air Transport Association, European carriers lost €1.3 billion in 2013. They are therefore unlikely to look to acquire new assets.

But experts point out that while it would be easiest for a European airline to take over LOT, the restrictions on the buyer’s origin are hardly insurmountable. A potential nonEuropean buyer could set up a EU-based entity – alone or in a joint venture with a European strategic or financial

investor – thus circumventing EU regulations.

For Mr Mikosz, the preparations to sell LOT mean restructuring. “The changes must be radical,” he said, adding that he has the Treasury Ministry’s “blessing” for “any move that is necessary.”

He estimates that the company will fire over 500 of its employees.

LOT has been hammered by bad news recently, and there is little to smile about when it comes to its recently purchased Dreamliners as well. Deputy Treasury Minister Rafa∏ Baniak announced that the company is losing $50,000 a day due to the grounding of its two new Boeing planes.

Jacek Ciesnowski

PGE and Energa spending billions on wind farms Major Polish utilities PGE and Energa are in advanced talks to buy the Polish wind power business of Spanish energy firm Iberdrola, Reuters reported, citing unnamed sources.

The deal’s value could amount to z∏.1 billion, which would equal the value of PGE and Energa’s recent purchase of the Polish wind farm assets of Danish energy group DONG Energy, which was

finalized last Tuesday.

Iberdrola has five wind farm projects with a total capacity of 184.5 MW in Poland. According to one source, the deal could be announced this week.

PGE, Energa and Iberdrola declined to comment on the matter.

Energa is mainly involved in the manufacture, marketing and distribution of electricity and heat. It provides electricity

to 2.5 million households and more than 300,000 companies in Poland, giving it about 17 percent of the country’s market in electricity sales. Its electricity distribution system covers about a quarter of Poland’s area.

PGE is the largest energy group in Poland. The PGE capital group’s share of electricity production in Poland is around KW 40 percent.

PKP plans to sell stations Polish State Railways (PKP) wants to improve the management of its train stations. To start with, PKP plans to sell 850 out of its 2,500 train stations in Poland. Most of these will be sold to local governments without tenders, as long as they pledge to make them available for passenger service.

Around 50 train stations

that have attractive locations but are not currently in use will be available for anyone to buy.

“This offer is directed to anyone who has an interesting idea regarding using the station building for commercial purposes,” says Jaros∏aw Bator, PKP’s real estate director.

One example of such an “interesting idea” is the

Bia∏owie˝a Towarowa station, built in 1903, which has been transformed into a restaurant.

Among the stations up for sale are: Gdaƒsk Oliwa, ¸ódê ˚abiniec, Bia∏ystok Fabryczny and stations in Ustka and Augustów.

Some of the stations will require sizable investments.

AS

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FINANCE & ECONOMICS

FEBRUARY 25 – MARCH 3, 2013

Industrial production

Inflation at lowest point since 2007

Polish industry sees surprise growth But most analysts are cautious about what it means Poland’s industrial production in January proved much stronger than analysts had expected, data released by Poland’s statistics office GUS showed last week. In year-onyear terms, the value of sold industrial production rose 0.3 percent, against analysts’ expectations of a drop of some 3 percent. In monthly terms, industrial production rose by 5.4 percent, while the market had expected a rise of just 3 percent.

Piotr Bujak, chief economist for Poland at Nordea Bank, said that the figures had “beaten the most optimistic forecasts,” and added that along with the stronger-than-expected German ZEW index released earlier in the day, the data “herald better times for the Polish economy going forward.”

But other economists were less sanguine. “[The] improvement against December was partly due to a working-days effect and it is too early to say, based on these figures, that Polish industry is recovering,” Bank Zachodni WBK economists wrote in a statement.

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“We stick to our long-held view that assumes economic growth is likely to bottom out in Q1 at around 0.5 percent y/y and gradually pick up in the following quarters,” Citi Handlowy analysts wrote, adding that despite the stronger industrial output they still maintain their assessment that “overall growth in Poland will be below potential, helping to keep inflation under control.”

In their view, though, the picture could improve if the German economy accelerates more than expected.

AK, AS

Poland’s consumer price index inflation rate fell to 1.7 percent in January year-on-year, with prices rising by 0.1 percent month-on-month, Poland’s statistics office GUS announced last week. At this level, inflation is at its lowest since August 2007 and also below economists’ median prediction of 2 percent y/y.

“This decline was underpinned by one-off factors (cuts in gas and communication prices), but primarily it is an effect of general lack of inflationary pressure given weak economic growth. This conclu-

sion is supported by the low level of core inflation, which, according to our estimates, amounted to about 1.5 percent,” economists from bank BZ WBK wrote in a comment.

“The inflation figure is a strong argument for another rate cut in March,” they added.

“There’s definitely more room to ease monetary policy,” rate-setter Anna Zieliƒska-G∏´bocka said in an interview on TVN CNBC, adding that she would support a rate cut in March.

AS

Steep drop Poland’s annual CPI inflation rate (%), January 2011-January 2013

Individual consumption falls, trend likely to continue continued decline and are close to those from the beginning of 2009, when the economic slowdown was at its worst in Poland.

NBP experts predict that consumers will keep their spending low in Q1 to increase consumption later in the year, but the growth in spending is not expected to be significant.

AS

4 Source: Central Statistical Office

dued longer-term prospects for private consumption.

“Deteriorating negative consumer moods and weak prospects for income increases suggest the low growth rate of private consumption should hold in coming quarters,” the NBP said.

The main consumption indicators for January show

5

3

2

1 Ja n Fe . ’11 b Ma . ’11 r Ap . ’11 r Ma . ’11 y Ju ’11 n Ju . ’11 l. ’ Au 11 g Se . ’11 p Oc . ’11 t No . ’11 v De . ’11 c Ja . ’11 n.

Fe ’12 b.

Ma ’12 r.

Ap ’12 r.

Ma ’12 y Ju ’12 n.

Ju ’12 l.

Au ’12 g.

Se ’12 p.

Oc ’12 t.

No ’12 v.

De ’12 c.

Ja ’12 n. ’13

Poland’s individual consumption fell by some 0.9 percent in Q4 of 2012 and will likely fall in Q1 2013, the National Bank of Poland wrote in a report on the situation of households.

The report, which is based on estimates by the Economic Institute derived from the analysis of the Poland’s statistics office, also suggests sub-

6

11

Budget deficit at 23.7% of yearly plan Poland’s state budget deficit amounted to z∏.8.43 billion at the end January, or 23.7% of the total deficit planned for 2013, which is z∏.35.56 billion, the Ministry of Finance announced. The state often runs up a high percentage of the deficit early in the year, only for that trend to decline sharply in the second half of the year as more revenue comes in.

Industrial production prices down Industrial production prices fell by 1.2% in January 2013 compared to the same month in 2012, statistics office GUS announced last week. This follows a 1.1% y/y decline in December. In month-onmonth terms, January industrial production prices grew 0.1%.

Economists surveyed by PAP had predicted prices in January would fall by 1.1% y/y and grow 0.2% m/m. ●

Media patronage

Maciej Witucki, president of the French Chamber of Industry and Commerce in Poland (CCIFP), discusses the chamber’s activities What kind of investments are popular among French companies?

French investments in Poland have a strong presence in several major areas. The first one is industry, especially new technologies with such companies as Thomson, Alstom, Vivendi and Alcatel. Of course, French capital is also involved in telecommunications, with two major players: France Telecom and Orange, as well as in the energy sector with companies EDF and GdF Suez. The number of large French commercial distribution networks, such as Auchan and Carrefour, is also growing. In the future the demand for French investors active in the area of municipal services, such as Dalkia and Veolia, will probably rise as well. So we are speaking of brands with well-established positions. Some of them are world leaders in their industries.

Can the amount of French investments in Poland be considered a success?

France is one of the top three foreign

investors in Poland, with capital of more than €19 billion involved here.

Today, French companies employ over 200,000 people, which is undoubtedly a great success for the Polish economy.

This does not mean, however, that the presence of French companies in Poland cannot increase. With its big market, Poland has great potential to attract new investors. Poland is a big market. The Economic Forum organized by CCIFP last year with the participation of the presidents of Poland and France showed that there are still many areas in which French-Polish economic cooperation could be better: in the energy, construction, and services for the domestic defense industry.

What have French companies achieved in Poland?

French investors have been in Poland since the beginning of Poland’s political and economic transformation. CCIFP has been in Poland since 1994, and the companies that established our organization are still present in the Polish market.

In the last five years we have seen more than a five-fold increase in the number of French investments in Poland. France is Poland’s fourthbiggest trading partner, with a 5.2

COURTESY OF THE FRENCH CHAMBER OF INDUSTRY AND COMMERCE IN POLAND

Strengthening Poland’s French connections

Maciej Witucki percent stake in the country’s foreign trade.

French investments in Poland influence the growth of Polish exports – more than 50 percent of goods manufactured in Poland by French companies are exported.

What are CCIFP’s goals for this year?

We intend to continue to support French companies in their investment activity in Poland and to represent their interests before Polish authorities. We want to share French

business experience with Polish companies.

We also want to help French investors in their preparations for possible expansion into Russia or Ukraine. We are also planning to promote French culture and French brands in Poland.

How does CCIFP help Polish companies to expand their business in France?

The CCIFP has a special department called the Business Development Center, where counselors

familiar with Polish and French market realities help Polish companies to succeed abroad. We organize trade missions, both for individual companies and for the representatives of particular sectors. We also search for partners, potential clients or distributors.

We also arrange business meetings promoting Polish products, which increasing often end with a contract being signed. We want to develop this because Polish companies have great potential.

Does CCIFP participate in events designed to promote France in Poland?

We promote France in two ways.

Firstly, we promote French business solutions. Polish entrepreneurs know our projects, such as the Eco-Town project, seminars and training conducted at the Center for Training and the CCIFP Grand Prix. The Business Development Center experts often organize seminars about France and the French market during meetings with local entrepreneurs and students.

But we have also started to focus more on the general public. In 2012 we organized the celebration of the national French holiday on July 14.

In this way, we want to make Poles feel the positive “French climate.” ●

12

OPINION & ANALYSIS

www.wbj.pl

FEBRUARY 25 – MARCH 3, 2013

The saver’s dilemma

M

ost of the international financial crises that have occurred over the last 200 years were the result of strains created by the recycling of capital from countries with high savings to those with low savings. The current European crisis is a case in point. For nearly a decade, capital from high-savings countries like Germany flowed to low-savings countries like Spain. The resulting build-up in debt created its own constraints, and now Europe’s economy is forced to rebalance.

If the rebalancing takes place only in Spain and other low-savings countries, the result, as John Maynard Keynes warned 80 years ago, must be much higher unemployment.

Whether unemployment remains confined to countries like Spain, or eventually migrates to those like Germany, depends on whether the former remain in the euro.

Savings and consumption Although the relative savings positions of Germany and Spain seem to confirm cultural stereotypes, national savings rates have little to do with cultural proclivities. Instead, they largely reflect policies at home and abroad that determine household consumption rates.

A country’s overall consumption rate is, of course, the flip side of its savings rate. Apart from demographics, which change slowly, three factors largely explain differences in national consumption rates.

First and foremost is the share of national income that households retain. In countries like the United States, where households keep a large share of what they produce, consumption rates tend to be high relative to GDP. In countries like China and Germany, however, where businesses and the government retain a disproportionate share, household consumption rates may be correspondingly low.

The second factor is income inequality. As people become richer, their consumption grows more slowly than their wealth. As inequality rises, consumption rates generally drop and savings rates generally rise.

Finally, there is households’ willingness to borrow to increase consumption, which is usually driven by perceptions about trends in household wealth. In Spain, for example, as the value of stocks, bonds, and real estate soared prior to 2008, Spaniards took advantage of their growing wealth to borrow to increase consumption.

Spain’s options But this is not the whole story. Consumption rates can also be driven by foreign policies that affect these three factors. For example, an agreement in the late 1990s among the German government, corporations, and labor unions, which was aimed at generating domestic employment by restraining the wage share of GDP, automatically forced up the country’s savings rate. Germany’s large trade deficits in the decade before 2000 subsequently swung to large surpluses, which were balanced by corresponding deficits in countries like Spain.

As Spain’s tradable-goods sector contracted in response to the expansion in Germany, it could respond in one of only three ways. First, Spain could refuse to accept the trade deficits, either by implementing protectionist measures or by devaluing its currency. Second, it could absorb excess German savings by letting unemployment rise as local manufacturers fired workers (because rising unemployment forces down the savings rate). Finally, Spaniards could borrow excess German savings and increase consumption and investment.

Of course, Spain could not legally choose the first option, owing to its EU and euro zone membership, and, not

Michael Pettis

surprisingly, was reluctant to choose the second. This left only the third option. Spaniards borrowed heavily prior to the crisis to increase both consumption and investment, with much of the latter channeled into wasteful real-estate and infrastructure projects.

This continued until 2007-2008, when Spanish debt levels became excessive. But, as long as Germany does not absorb its excess savings and accommodate the desired rise in Spanish savings, Spain is still faced with the same options. Once borrowing is no longer possible, Spain must either intervene in trade – which implies leaving the euro zone – or accept many more years of high unemployment until wages are driven down sufficiently to produce the equivalent of currency devaluation.

Rebalancing needed Low-savings countries cannot easily adjust without an equivalent adjustment in high-savings countries, because their low savings rates may have been caused by high savings abroad. After all, savings and investment must be in balance globally, and if policy distortions cause savings in one country to rise faster than investment, the reverse must occur elsewhere in the world.

Savings rates in Spain and other deficit countries in Europe had to drop once policy distortions forced up Germany’s savings rate. In theory, excess German savings could have left Europe; but, given high Asian savings that already had to be absorbed, mainly by the US, and the constraints imposed by the euro, it was almost inevitable that excess German savings would be exported to other European countries.

Germany should care about Spain’s difficulty in adjusting, because the resulting rise in European unemployment will be absorbed mostly by Spain unless the Spanish government accelerates the adjustment process by leaving the euro zone and devaluing.

In that case, Germany would bear the brunt of the rise in unemployment.

Once deficit countries take aggressive measures, it is usually trade-surplus countries that suffer the most from international crises caused by trade and capital flow imbalances. ● Michael Pettis is professor of finance at Peking University and a senior associate at the Carnegie Endowment. This article is based on his recently published book “The Great Rebalancing.”

Copyright: Project Syndicate, 2013.

Project-syndicate.org

Europe’s foreign-policy resilience Vaira Vike-Freiberga and Antonio Vitorino

F

or decades, people have bemoaned the waning of Europe’s global political power.

To add some precision to the debate, in 2010 we helped to write the European Council on Foreign Relations’ first Foreign Policy Scorecard.

Back then, we wrote – rather mildly – that Europe had been “distracted” by the euro crisis. By the end of 2012, the crisis could be considered less acute. Nevertheless, European leaders have continued to devote more time and effort to financial and institutional questions than to geopolitical issues.

Europe’s image and soft power have undoubtedly continued to fade around the world (though such a trend is difficult to quantify), while member states continue to cut defense and development budgets.

The good news, however, is that European foreign policy has not unraveled in the crisis. Indeed, it has even shown some signs of progress.

Not a bad record The European Union managed to preserve the essence of its acquis

diplomatique. In fact, the Scorecard’s assessment of European foreign-policy performance in 2012 shows modest signs of stabilization and resilience. Although the EU had no high-profile successes comparable to the military intervention in Libya in 2011, it performed surprisingly well in its external relations – especially given the deep crisis with which it continued to struggle.

For starters, the coherence of Europe’s policies toward Russia improved: the EU threatened to use the World Trade Organization’s dispute-settlement mechanism when the Kremlin announced new protectionist measures in late 2012. It also launched an antitrust probe against Russian gas giant Gazprom, and criticized human-rights abuses during the crackdown on demonstrations that accompanied the March election that returned Vladimir Putin to the presidency.

There were also signs of modest improvement in Europe’s relations with China, despite a lack of unity that continued to undermine its leverage. New EU missions to Niger,

South Sudan, and the Horn of Africa under the aegis of the Common Security and Defense Policy were also launched – something that had not happened in the previous two years.

Of course, there were also areas in which Europeans performed less well.

Above all, they could not break the frustrating diplomatic gridlock over Syria or stem the escalation in violence as the year went on. Europeans remained divided on the Israeli-Palestinian conflict (though to a lesser degree than in previous years), and failed to have an impact on the United Nations vote in November to upgrade Palestine’s status. They also struggled to pursue a united approach to Azerbaijan and Ukraine, and continued to seek a coherent approach to Turkey as accession negotiations remained blocked.

Nonetheless, the EU’s foreignpolicy performance in 2012 was positive overall. It now remains to be seen whether this momentum can be maintained, which will depend largely on whether the EU can overcome the economic crisis (which continues to worsen in several member countries), restore growth, and curb unemploy-

ment. In this sense, European leaders are right to focus on solving the financial crisis in the euro zone.

Still much work to be done Any future gains in global influence, however, will require Europeans to overcome their internal divisions and improve their foreign-policy coordination. In particular, success will require turning the European External Action Service (EEAS) into an effective diplomatic corps that can convert the EU’s huge resources into real power.

The near future will present a growing list of challenges. There are already indications from key strategic partners that they are beginning to regard the euro crisis as the “new normal”; in other words, they are planning for a future in which European power continues to erode.

Europe’s lack of a collective defense strategy, together with declining investment in military capacity, is also a serious obstacle to its continuing global influence as a security actor.

This makes it even more important for the EEAS to align the Common Security and Defense Policy

with wider foreign-policy efforts. This is a daunting task, given the EU’s current structure. The specter of a British withdrawal from the EU will not make things any easier.

The US “pivot” to Asia further increases the pressure on Europe to deal with its own neighborhood.

Although the EU’s foreign policy toward Russia has become more effective, tensions have, if anything, grown – and may continue to do so.

Despite the gravity of the euro crisis, the EU foreign-policymaking machine (such as it is) continued to function in 2012, with moderately successful results. Just getting by, however, is unlikely to be enough to address the challenges that Europe is likely to face this year. The EU will need to do more – and do it better.

We remain hopeful that it will be up to the task. ● Vaira Vike-Freiberga is a former president of Latvia. Antonio Vitorino is a former Portuguese EU commissioner for justice and home affairs.

Copyright: Project Syndicate, 2013.

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13

Euro adoption

When will Poland join the euro zone?

Remi Adekoya

Poland will try to fulfill the criteria to join the euro zone “as soon as possible” but the final decision whether to access or not would have to be “100 percent safe for our country,” said Prime Minister Donald Tusk while speaking on the issue in parliament last week.

The government has begun a push towards bringing the country closer to joining the single currency union, starting with a comprehensive public debate, as it looks to make Poland a core EU member that can participate in the bloc’s key fiscal decisions.

During the speech, the prime minister also said the choice of joining the euro zone would need a “widespread” support amongst MPs, referring to the fact that a two-thirds (or “constitutional”) majority will be needed in parliament to change Poland’s official currency from the z∏oty to the euro.

“There will not be a constitutional majority for joining the euro zone unless there is widespread and complete conviction that it is safe for Poland,” said Mr Tusk.

However, in order to get a constitutional majority on board, the government would need the support of the largest opposition party, Law and Justice (PiS). But the eurosceptic PiS has said it wants a referendum on the issue.

Euro enthusiasts would be hard-pressed to win such a referendum. A December Ipsos Observer survey showed 56 percent of Poles were against Poland adopting the euro.

President in favor This week, the prime minister and his government are scheduled to meet with President Bronis∏aw Komorowski in a special Cabinet Council meeting organized to discuss

COURTESY OF KPRM

The country’s top officials seem to be trying to speed things up

Will Donald Tusk and Bronis∏aw Komorowski take Poland into the euro zone?

Poland’s path to the the euro zone. The president fully supports Poland adopting the European common currency.

In an interview for television channel TVP1 last month, Mr Komorowski said that Poland should be able to fulfill the euro zone’s convergence criteria by 2015.

“Today instead of considering theoretical matters, such as taking decisions about Poland’s membership in the euro zone, we should concentrate on the first phase: fulfilling the requirements to join the euro zone ... because they are good for Poland,” the president said.

Nevertheless, Mr Komorowski has given no indication that he intends to hurry the prime minister and his government on the issue, at least for now.

Conditions to meet In 2008, Prime Minister Tusk said that Poland would adopt the euro by 2011 – that was just days before the collapse of Lehman Brothers, and the ensuing global economic crisis meant all those plans went out the window. Since then, the Polish government has maintained that it is committed to joining the euro zone while refusing to set a concrete date for eventual membership.

However, government officials say that Poland will have ful-

filled all the criteria needed to join the currency zone by 2015.

To be able to adopt the euro, Poland must meet the conditions laid out in the EU’s Maastricht Treaty, such as bringing its budget deficit to within 3 percent of GDP, public debt below 60 percent of GDP and the inflation rate to within 1.5 percentage points of the average of the three EU states with the slowest price growth. It must also meet certain interest-rate convergence criteria and spend two years in the European Exchange Rate Mechanism (ERM II).

However, as of January 2013, the only of these criteria Poland had met were those regarding public debt and interest rates. But the government made significant progress when it comes to bringing the overall budget deficit closer to the Maastricht Treaty targets.

Among its reforms, Mr Tusk’s government can count raising the retirement age and curbing early retirement pensions for uniformed services. It managed to reduce the budget deficit to 3.4 percent of GDP last year from 7.9 percent in 2010. Meanwhile, Poland’s public debt was under 53 percent of GDP in 2012, according to finance ministry estimates, well under the permitted maximum 60 percent. And that compares with an average

Maastricht criteria for euro zone entry (ECB methodology)

Maximum Poland’s 2012 results

HICP inflation rate

Budget deficit to GDP

Debt-to-GDP ratio

Long-term interest rate

3.1%

3%

60%

5.8%

4%

5.1%

56.3%

5.77% Source: 2012 ECB report

of 92.9 percent in the euro area.

Experts weigh in “Poland will need about four years to join the euro zone. At the moment, we don’t meet the criteria, especially the fiscal ones. But we hope to fulfill them by 2014,” said Stanis∏aw Gomu∏ka, chief economist at the Business Centre Club and a former deputy finance minister in Mr Tusk’s government.

“The economic slowdown will make it easier to fulfill the interest rate and inflation criteria. The euro zone itself is

coming back to health thanks to its reforms and so it would now be safe to join,” he added.

And so BCC, one of the largest and most influential employers’ associations in the country, thinks Poland should join the ERM2 at the beginning of 2014 to enable it to formally join the currency union at the beginning of 2017.

But Mr Gomu∏ka said there is a risk the process could still be a drawn out affair due to Poland “not reducing the budget deficit fast enough and not changing the constitution on time.”

Meanwhile, Zenon Marciniak, an economics professor at the Warsaw School of Economics, said the National Bank of Poland has conducted “two complex surveys, both of which revealed that joining the euro zone would bring tangible benefits for Poland. And so delay means delaying those benefits.”

Marek Belka, a former prime minister and current head of the NBP, spoke out on the matter recently. In an interview with the Wall Street Journal last week, he said he supports joining the euro zone but is “less enthusiastic about a very quick euro adoption.”

Recent changes in the rules governing the euro zone have strengthened the common currency, Mr Belka said. But he also said that Poles need to keep in mind that the goal is not just “to join the euro, but also to stay there as a country of the core and not of the periphery.”

“We’re still a catching-up economy, an emerging economy, with all its weaknesses and strengths,” Mr Belka said, adding that Polish policy makers should compare the country with “the Spain of some years ago.”

“We know what happened there, but we hope to avoid the mistakes of Spain,” he added.

When, realistically?

Looking at macroeconomic data and economic forecasts, it would seem that the BCC’s proposal for Poland to join the euro zone in 2017 is not an unrealistic one. If there continues to be strong political will in Poland to join the currency union and if the Polish economy does not take any unexpected hits in the coming years, then it is likely that Poland will join the euro zone before the second decade of the 21st century runs out. ●

Should Poland try to adopt the euro as soon as possible?

“Yes”

“No”

Henryka Bochniarz President of PKPP Lewiatan

Adam Narczewski Managing Director, X-Trade Brokers

“While the European Union moves towards deeper integration, Poland cannot remain outside the area of close cooperation. Poland must be in the euro zone if it wants to be a true EU member and have any bearing on the EU’s shape in the future, a year or 10 years from now. Prime Minister Donald Tusk has already declared our intention to adopt the common currency, now is the time to start a public debate on the benefits and costs of joining the euro zone.

It is the debate as well as a thorough information campaign that matters, and not the dates. Recent polls show that two-thirds of Poles oppose euro adoption. The prevalent sentiments among entrepreneurs don’t instill optimism, either. That’s why we need a discussion based on facts and not on populists’ arguments. Meanwhile the only comprehensive document analyzing the pros and cons of being part of the euro zone was published by the National Bank of Poland back in 2008! A new report is therefore indispensable before any real actions are taken.”

“Poland will enter the euro zone one day, but I oppose doing it as soon as possible. The Polish economy is far from real convergence with the euro zone’s economy and therefore the government should take its time with the decision.

Poland is still an emerging market and until it converges with other euro zone economies, it should not accept the euro. Poland needs an autonomous monetary policy. As an emerging market it needs higher interest rates. Entering the euro zone will mean accepting the muchlower rates established by the European Central Bank. Lower rates should give a boost to the economy: GDP would grow faster relatively to other economies; but at the same time it would cause inflation to jump.

Increasing inflation, with the euro remaining at the same level relative to other currencies, would make the Polish economy less competitive. This in turn will push unemployment higher.

In summary, lower rates will boost GDP in the short term, but will cause higher inflation and higher unemployment in the longer term.”

14

INTERVIEW

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€22.8 bln for Polish regions Polish regions will receive more funds in the 2014-2020 budget than in the previous budgetary period, Deputy Minister for Regional Development Pawe∏ Or∏owski said. The money – an estimated €22.8 billion – will come from the European Regional Development Fund and the European Social Fund.

Trade booms on eastern borders Statistics office GUS estimates that in 2012, Russians, Belarusians and Ukrainians spent z∏.6.62 billion on shopping in Poland’s border area, mostly on food, construction materials and car parts. That’s up from z∏.5 billion in 2011.

Poles also cross the border to buy cheaper products, mostly gasoline.

They spent roughly z∏.650 million in 2012 on such trips. Shopping in Poland is a bargain for Russians, Belarusians and Ukrainians, as many prices are lower than at home. ●

FEBRUARY 25 – MARCH 3, 2013

International relations

Ireland getting back on track Eugene Hutchinson, Ireland’s ambassador to Poland, sits down with WBJ to talk about the situation in the European Union and the 20142020 budget, the Irish EU Presidency and Polish-Irish relations Ewa Boniecka: Having been badly affected by a banking crisis which led to an economic crisis, Ireland’s strategy for economic recovery seems to be working. Why do you think that is?

Eugene Hutchinson: Ireland posted modest growth in 2011 and 2012 and we expect 1.5 percent GDP growth this year.

The export sector is leading the recovery. Exports are now exceeding pre-crisis levels and reflect the very significant improvement in our competitiveness.

Foreign direct investment is strong, the difficult international economic environment notwithstanding. We are the world’s highest-rank-

ing economy in terms of the availability of a skilled workforce. With one of the most open economies in the world, Ireland is, in a real sense, “trading” its way to recovery – the only sustainable way in the long term.

Exports are forecast to increase by some 3.3 percent this year.

The strong export performance has been producing an increasing surplus in the balance of payments since 2010. However, domestic demand remains subdued, household savings are high and, while this has begun to ease somewhat, unemployment is stubbornly high at about 14 percent.

What is the outlook for the future then?

Our medium-term growth potential is strong. We are fortunate in having a flexible, adaptable economy, a welleducated and an internationally recognized pro-business environment.

Our GDP growth is forecast at 2.7 percent

“Ireland is, in a real sense, ‘trading’ its way to recovery.” for 2014 and 2015. With this, as well as the further consolidation of public finances, our budget deficit should be reduced to below 3 percent of GDP by 2015.

So far, Ireland has met and exceeded all of the targets in our EU/IMF assistance program.

We will continue to do so. Our

banking system is being downsized and repaired, sustainability restored to public finances and we are concentrating on stimulating economic growth. But many risks and uncertainties remain, such as the economic situation in our export markets.

This year, we intend to be the first EU/IMF program country in the euro zone to make a sustained return to the sovereign bond markets, and we are working with our partners to make sure this difficult task is achieved.

Needless to say, this hasn’t been an easy process for Ireland. It has required us to make difficult choices, and asked much of the Irish people. Yet we have also been able to maintain social cohesion and solidarity throughout this difficult period.

Ireland took over the rotating Presidency of the EU in Jan-

uary. This is a familiar role for Ireland, isn’t it?

Yes, this is Ireland’s seventh Presidency. The first was in 1975 – a few months after I joined our foreign ministry.

Our 1990 Presidency managed Europe’s common approach to the historic unification of Germany. In 2004, during Ireland’s most recent EU Presidency, we welcomed Poland and nine other member states into the Union. And this year we celebrate the 40th anniversary of Ireland’s membership of what is now the European Union.

While we are, in a sense, Presidency veterans, in another way we are newcomers as this will be our first EU Presidency under the revised rules and procedures of the Treaty of Lisbon. In that sense, Poland is ahead of us; Poland has already held a Presidency under the new Lisbon Treaty arrangements.

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INTERVIEW

FEBRUARY 25 – MARCH 3, 2013

advance free trade negotiations with Japan, India and other strategic partners, and also the EU-China relationship. We will place a special focus on the EU-US trade relationship.

Could you be more specific?

Let me explain our approach on jobs. We applied what we called a “jobs test” across all policy areas when picking our [EU] Presidency’s priorities.

With youth joblessness at more than 25 percent in 13 member states, including Ireland, we want to spare no effort in tackling this scourge. We wish to see member states’ policies move towards programs of traineeships, further education and other opportunities.

COURTESY OF THE IRISH EMBASSY IN POLAND

When we were preparing for our Presidency, the Polish Ministry of Foreign Affairs shared with our planners its experiences from Poland’s own successful tenure. So we hope that we can make progress, make a difference. But the Presidency, Irish or otherwise, cannot do it alone. The cooperation of all member states is required to succeed.

What are your country’s priorities for the EU Presidency?

Of course, every Presidency has an array of challenges to confront. Some of these are ongoing, such as the economic crisis which has dominated the work of all EU presidencies in recent years. Its aftershocks, as well as the Union’s response to them, will be very evident during Ireland’s Presidency.

As we see it, 2013 ushers in a new phase in the EU’s drive for recovery. So Ireland’s Presidency is about making a contribution to securing stability and ensuring that this will bring jobs and growth. Hence the theme of our Presidency is “Stability, Jobs and Growth.”

We have all been affected by a crisis that revealed the weakness in the monetary and fiscal framework of the European Union. The economic and social effects of the crisis have led to unacceptably high levels of unemployment and hardship across the EU, not least in Ireland.

But we see opportunities as well as challenges at this stage.

We feel that the EU is entering the next phase of its recovery.

The values and strengths underpinning the European project ensure that the European method of decision-making can indeed produce the necessary changes.

The pressing priority for the Union is economic growth, to give those affected by devastating job losses a chance. So the first step is to build lasting stability, starting with advancing the renewal of economic governance in Europe.

We feel that a key area for progress will be in the banking union. Fixing the European banking system will make a real difference. We also aim to improve the Union’s economic coordination. We need to optimize the prospects for jobfriendly growth and contribute to tackling youth unemployment. In a nutshell, our priorities are stability, jobs and growth.

www.wbj.pl

Ambassador Eugene Hutchinson The “Compact for Growth and Jobs” is a key element of the Irish Presidency and the need to improve the implementation of the single market priorities is clear. This has been a great European success story, but a story which is yet unfinished. We want to unlock more of the single market’s potential, thus contributing to job creation and to the viability of small and medium-sized enterprises.

Lower transaction costs, for example, will increase profits and thus employment in these enterprises. There are nearly 21 million SMEs in the EU, employing more than 85 million people. A lot can be done to boost employment in other areas, for example through the “Erasmus for All” framework.

Our Presidency is pushing ahead with legislative proposals to promote Europe’s Digital Economy, to benefit both business and consumers. This is a complex, multifaceted area: EU foreign ministers will work on cyber security, competitiveness ministers on copyright aspects while EU justice ministers will work on data protection.

Has the enlargement process lost its momentum?

We are working with renewed purpose on further enlargement of the Union, to advance the process for all of the candidates and prospective candidates. We expect to see Croatia join the EU at the beginning of July 2013. We want to advance the negotiations with Iceland and Montenegro, and will also restore the momentum in the accession process with Turkey.

Each country is at a different stage but we hope to open negotiation chapters with all of them.

The European Council Conclusions agreed in December to allow for the possibility of important decisions on the

former Yugoslav Republic of Macedonia, Serbia, Albania, and Kosovo during Ireland’s term. We stand ready to progress with them during our Presidency, should the Council so decide.

The EU budget for 2014-2020 was agreed upon after long and difficult negotiations. How does Ireland see it?

The Multiannual Financial Framework (MFF) is a key issue. The funding for policies and programs such as the Common Agricultural Policy and Cohesion Policy will have a major impact on our future.

We want to ensure that future financing supports sustainable growth, innovation and key infrastructural projects, while promoting employment and social inclusion.

Ireland will seek to secure the consent of the European Parliament for the adoption of the budget. We will lead the negotiations with the European Parliament on each of the nearly 70 legislative measures necessary to give practical effect to the agreed budget.

Given its preoccupation with handling the economic crisis, how do you see Europe’s relations with the world?

Of course, Europe’s recovery cannot happen in isolation.

Europe needs to look outside its borders and engage with its global partners. During its Presidency, Ireland will fully support Catherine Ashton, the Union’s High Representative for Foreign and Security Policy and the European External Action Service in strengthening the effectiveness of the EU’s external policy, responding to challenges in foreign policy and ensuring security.

Trade is a major driver of growth. Thirty million jobs, about 10 percent of the EU’s workforce, depend on exports.

A strong package of trade agreements could add 2 percent to EU growth rates. We hope to build momentum in the negotiations between the EU and third countries so that our exporters can have better access and greater opportunities. We would like to conclude trade agreements with Canada and Singapore. Our Presidency also wants to

You mention EU-US links.

What are the main factors in the Irish-US relationship today and how do you see EUUS trade relations today?

Ireland has traditionally enjoyed a close relationship with the United States. We have close ties regarding history, family, culture and, more recently, vital economic and commercial links.

On the basis of this relationship, we feel that we are well-positioned to contribute to deepening the relationship between the EU and US. Two of the world’s largest trading blocs, they already have very strong trading and investment ties. The successful future conclusion of a free trade agreement with the US would have a significant and positive impact, resulting in new markets for European exporters with knock-on positive effects on job creation, a key objective for us. The Irish Presidency will work towards a new generation Trade and Investment Agreement between the EU and the US. How do you assess the current Polish-Irish relationship?

15

Ours is, by and large, a new relationship but it is a strong one which I am sure will last.

Tens of thousands of young, dynamic and entrepreneurial Poles have come to work in Ireland over the last decade.

Perhaps as many as 150,000 currently live in Ireland – which explains why Polish is now the second-most spoken language there.

The Irish-Polish economic and commercial relationship is substantial and mutually beneficial. Bilateral trade in goods and services is valued at close to €2 billion annually. Irish exports to Poland have been growing steadily in recent years, notwithstanding the economic turmoil in Europe.

Our exports increased by about 15 percent last year, to some €700 million.

Poland is the 8th-largest market for indigenous Irish companies. We estimate Irish direct investment in Poland at €1.5 billion and Irish companies employ some 4,500 people. Our links at the political level are excellent – many Irish Government Ministers came to Warsaw in the run-up to our Presidency. And, let’s not forget the vibrant and growing Irish community in Poland, including many Irish business people and students.● This is an abridged version of our interview. For the full discussion, log on to WBJ.pl this week

Echo Investment has launched construction on its Nowy Mokotów residential project

Former machine producer Waryƒski plans two huge developments in Wola

18

18

LOKALE IMMOBILIA

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

Konsalnet Holding to change HQ Security company Konsalnet Holding will move to a new office building that will be erected on ul. Jana Kazimierza in Warsaw’s Wola district by developer Laris Investments, part of the Elektrim Group. The 9,000 sqm building is scheduled for completion in the third quarter of 2014.

MEC moves to Diamond Business Park Gliwice Messer Eutectic Castolin will move to Diamond Business Park Gliwice, a 46,000-sqm industrial park owned by AIG/Lincoln. A new building will be constructed for MEC to fit its executive offices, a training center, a manufacturing plant and warehouse space totaling nearly 5,000 sqm. ●

In this issue Offices in historic buildings . .17 Universal to be demolished . .17 Nowy Mokotów launched . . . .18 Waryński's plans for Wola . . . .18 Europa Centralna to open . . . .18 Warsaw office market . . . . . . .18

Prestigious offices move to historic sites Warsaw’s historic buildings attract investors as potential office space Following a trend whose recent examples include Warimpex’s refurbishment of a pre-war tenement houses on ul. Pró˝na, more of the capital’s historic buildings are being turned into office buildings.

Centrum Bankowo-Finansowe “Nowy Âwiat” is to launch construction of its new 9,270-sqm five-storey office building between the Dom Partii – the former communist party headquarters – and the tenement houses on ul.

Ksià˝´ca. The investment will be situated on ul. Nowy Âwiat, ranked 43rd in Cushman & Wakefield’s list of the world’s 62 most expensive high streets.

The development will be a discreetly elegant, glass-layered scheme, designed by Andrzej M. Ch∏odzyƒski’s architect studio. Situated near Pl. Trzech Krzy˝y and the Rondo de Gaulle’a round-

Centrum Bankowo-Finansowe’s planned office building on ul. Nowy Âwiat in Warsaw about, it will offer 4,050 sqm of GLA and 1,870 sqm of retail space. The scheme will include an underground parking lot for 40 cars and a separate underground garage building for 160 cars.

Kamienica Krasiƒskich Meanwhile, work is progress-

as the construction of a new wing facing the Academy of Fine Arts.

The estate, Kamienica Krasiƒskich, also known as the Raczyƒskich tenement house, will regain its original facade and display windows on its first two floors, as per requirements set by the city’s historic curator.

ing on the construction site of Hochtief Development Poland’s new office project near Pl. Ma∏achowskiego and Pl. Pi∏sudskiego in the heart of Warsaw, near the Royal Route. The investment involves the refurbishing of the Kamienica Krasiƒskich historic tenement house as well

Kamienica Krasiƒskich, one of the city’s most wellknown pre-war schemes, was designed by renowned architect Jan Heurich and constructed in 1907-1910.

Destroyed during the World War II, it was later rebuilt with slight alterations – without its big display windows – and served as the seat of the then Ministry for Post and Telegraphy before it was sold to Dom Development for z∏.100 million and then resold to Hochitef.

The investor decided the building would host offices as well as luxury retail units and restaurants on its first two storeys. Together with the new wing, it will comprise 13,956 sqm of leasable space; 12,533 sqm will be designated for office area. The scheme, scheduled for completion in Q3 2014, will also offer about 100 parking spaces on two underground levels.

The investor wants to breathe new life into the picturesque pre-war area of Pl. Ma∏achowskiego Karolina Kowalska

Office

Universal set to be demolished A new 80-meter skyscraper will replace the soon-to-bedemolished Universal building in the center of Warsaw The 50-meter Universal building, located behind the famous Rotunda PKO building in the heart of Warsaw, will be sold next week by the bankruptcy trustee of Metro-Projekt, Andrzej Brzeziƒski.

The 48-year-old scheme is expected to be demolished by a buyer that could build a new 80-meter skyscraper in its place. The price of the purchase is expected to amount to at least z∏.110 million.

Any new scheme that goes up in place of the Universal building is likely to be one of the most expensive and prestigious office investments in the city. A few of months ago city authorities issued building permit for a new 70-meter project, but now they claim the new project could be even higher.

The Universal building was built in 1965 as Universal Foreign Trade Center, the only importer of foreign household appliances in the communist era. It was part of Warsaw’s socalled Eastern Wall (Âciana Wschodnia), formed by the Rotunda building, which hosts one of bank PKO BP’s bestknown branch offices, and

three residential towers.

In 1999 the building was bought by Kraków-based company Code for z∏.60 million and after a couple of days was resold to another company, MetroProjekt, which offered z∏.84 million. Metro-Projekt wanted to demolish Universal and to erect a modern office building there but never followed through with the plans. The company went bankrupt in 2002.

For the past couple of years the building’s west-facing facade has been covered with large-scale advertisements. It is hoped that a new high-rise residential scheme will improve the appearance of the area.

The tender for the building will be held on March 1.

REPORTER

London-based investment fund Valad Europe has acquired €570 million worth of Polish retail real estate from GE Capital Real Estate. The properties comprise six shopping centers in Poland’s biggest cities, including Warsaw, Kraków and Wroc∏aw.

Offices

COURTESY OF CENTRUM BANKOWO-FINANSOWE “NOWY ÂWIAT”

GE real estate taken over by Valad Europe

FEB 25 – MAR 3, 2013, LI 18/07

The Universal building was erected in 1965

Warsaw Business Journal presents Real Estate weekly newsletter • Know about the newest projects before they’re on the market • Keep up to date on the latest tenders and auctions • Learn the latest trends in Poland’s dynamic office, residential and retail sectors • Find out who’s who in Polish real estate To subscribe: e-mail subscribe@wbj.pl or call +48 22 639 85 68, ext. 201 and sign up for free two-week no-obligation trial subscription

18

LOKALE IMMOBILIA – REAL ESTATE

www.wbj.pl

Residential

FEBRUARY 25 – MARCH 3, 2013

Residential

Echo Investment Waryƒski active in Wola launches Nowy Mokotów Nowy Mokotów is Echo Investment’s latest residential project in Warsaw. The investor’s current offer includes luxury apartments in Klimt House on ul. Kazimierzowska in Warsaw’s Mokotów district.

One of the largest property investors and developers with Polish capital operating in Europe, Echo Investment has completed more than 90 projects in Poland to date, with a total of over 800,000 sqm of space. The company is also active in the Romanian, Hungarian and Ukrainian markets.

Waryƒski’s office complex in Wola is scheduled for completion in Q1 2015

Karolina Kowalska

The former machine producer has plans for two huge complexes in the western Warsaw district Grupa Waryƒski is planning two major projects in Warsaw’s Wola district, one of which will include two mixeduse developments and the other an office complex.

More than 100,000 sqm of apartments and offices will be available in the mixed-use residential and office estate.

Grupa Waryƒski is planning to build the scheme on a sevenhectare plot on ul. Jana Kazimierza. Office space is expected to account for around 20 percent of the total volume.

COURTESY OF ECHO INVESTMENT

The project includes six buildings, each from five to nine storeys

Retail

Developer Helical Poland has recently been granted an occupancy permit for its Europa Centralna retail park on ul.

Paszczyƒska 315 in Gliwice, Silesia voivodship, in southern Poland. The grand opening has been scheduled for March 1.

With its 70,000 sqm of

retail area, Europa Centralna is one of the biggest integrated retail centers in the CEE region. Designed by Pracownia Architektoniczna Czora & Czora and constructed by Polimex-Mostostal for z∏.181.6 million, it comprises a 28,000sqm shopping mall, a 38,000sqm retail park and a parking lot with 2,300 spaces.

The shopping mall will be anchored by a 10,800-sqm Tesco hypermarket, and the retail park by a 9,500-sqm Castorama DIY store. Other ten-

ants include Saturn, Jula, Smyk, Reserved, H&M, KappAhl, Cubus, Empik, CCC, Deichmann, Wojas, Media Expert and Super-Pharm. The center is now 80-percent leased.

Founded in 2005, Helical Poland is a subsidiary company of Helical Bar, a British property development and investment company. Helical Poland specializes in building large shopping malls and retail centers.

Karolina Kowalska

Karolina Kowalska

Warsaw among the most expensive office locations in the world COURTESY OF HELICAL POLAND

One of the biggest retail centers in Central Eastern Europe will open this week

at the intersection of ul. Jana Kazimierza and ul. Ordona and will comprise two adjoining buildings – one five storeys high and the other 10. The scheme will be designed by the S.A.M.I. Architekci Mariusz Lewandowski i Wspólnicy studio. Waryƒski officials say the investment should obtain a construction permit in September and should be completed in Q1 2015.

Formerly a construction machinery producer, Grupa Waryƒski wants to become increasingly active in the property market in the upcoming years. The company plans to deliver a 9,000-sqm office building in Warsaw’s Wola district in the first half of 2015.

Office

Europa Centralna to open March 1

Europa Centralna will be anchored by a 10,800-sqm Tesco hypermarket

The company recently signed an agreement with developers Polnord and Dantex, its partners in the investment. The detailed schedules of the developments will be prepared within the next few months, as the investment is currently at the planning stage.

Waryƒski Group will decide on the design, general constructor and the budget. Construction is expected to launch at the turn of 2013 and 2014.

Grupa Waryƒski’s representatives said that the company is planning to complete all phases of the two projects within the next six to eight years.

Nearby, the firm is also planning to erect an office complex. The 9,000-sqm development will be situated

The office market performed well last year and more of the same is expected for 2013 Warsaw is the 33rd mostexpensive location for office space according to Cushman & Wakefield’s Office Space Across the World ranking, which monitors trends and practices in the market.

Rents in Poland grew by 2 percent last year, reaching a monthly average of €26.50 per sqm.

According to the advisory, the Polish office market performed well in 2012 in terms of activity levels and demand for office space throughout the year.

With the domestic economy outperforming most of Europe, tenant demand remained high, keeping prime rents in Poland’s major cities steady or slightly buoyant. The company predicts

COURTESY OF WIKIMEDIA COMMONS

Warsaw Stock Exchange-listed developer Echo Investment recently launched construction on its Nowy Mokotów multifamily residential project, located on ul. Konstruktorska in Warsaw’s Mokotów district.

The investment will comprise 700 apartments in six buildings and is scheduled for completion within the next six years. The estate is located in the capital’s popular S∏u˝ewiec Przemys∏owy business district, where the company is also developing its Park Rozwoju office complex. All of the buildings consist of five to nine floors and are connected by a three-storey base.

Apartments on the ground floor will have gardens and those on top floors will have spacious terraces. The remaining apartments will have loggias and balconies. There is also an underground parking lot equipped with a special security system that allows cars with LPG installations to use it as well.

Nowy Mokotów was designed by the APA Kury∏owicz & Associates architectural studio. “We focused on the

most important priorities of the residential development in a large city,” said Ewa Kury∏owicz, the firm’s vice president.

“Each such estate needs to have its own characteristic feature, which allows its residents to identify with the place through architecture,” she added. “So we are dealing here with urban villas, which have been designed to maintain spaciousness and individuality. Residents will certainly not have to live the lives of their neighbors all the time, but the layout of the project will encourage integration.”

COURTESY OF WARY¡SKI

The residential project in Warsaw will comprise 700 apartments

Office space doesn’t come cheap in Warsaw that 2013 will see similar conditions, despite slowing economic growth.

London’s West End is once again the most expensive office district in the world.

Globally, prime office rents rose by 3 percent in 2012, but this was largely driven by impressive levels of growth in

South America, particularly Brazil and Colombia.

Despite the global increase in rent levels, the continuing economic uncertainty undermined prime rent levels in some countries by making occupants more cautious and less eager to expand or upgrade their premKarolina Kowalska ises.

THE LIST

FEBRUARY 25 – MARCH 3, 2013

www.wbj.pl

19

Construction & Real Estate

Property and Facility Management Companies Ranked by total gross building area (GBA) managed as of February 2013

www.bookoflists.pl

Total number of buildings managed: Owned by company / Not owned by company / Total

Gross building area (GBA) managed: PM (sqm): Owned by company / Not owned by company / Total

Number of buildings managed: PM: Owned by company / Not owned by company / Total

Gross building area (GBA) managed: FM (sqm): Owned by company / Not owned by company / Total

Number of buildings managed: FM: Owned by company / Not owned by company / Total

✓

3,750,000 3,750,000

183 183

-

-

3,750,000 3,750,000

183 183

Technical maintenance; cleaning; energy North Gate (Warsaw); management; security; Metropolitan (Warsaw); Deka Immobiien; Cushman & administration support; Company House II - Microsoft Wakefield Polska; AXA Real mobile services; maintenance (Warsaw); Crown Square Estate; INVESCO Real Estate of outdoor areas; waste (Warsaw) management

2,093 1993

68 68

-

-

2,529,838 2,529,838

68 68

ABB (Aleksandrów ¸ódzki; ¸ódê); Tulipan Park (Stryków; Komorniki; Plewiska; Gliwice; Tychy); Factory (Wroc∏aw; Luboƒ; Warsaw; Kraków); Plaza (Lublin; Poznaƒ); Bonarka City Center; Dell (¸ódê); Manufaktura (¸ódê)

ABB; SEGRO; Neinver/Irus; Klepierre; Trigranit; Dell; Apsys

WND 2004

Brice Mellies; Krzysztof Skowroƒski

Technical maintenance; administrative, infrastructural Faurecia Wa∏brzych; Rondo 1; services; low voltage Lipowy Office Park; Baltic installation services; Business Center; Business refrigeration services; blueFM; Park (Gliwice; ¸ódê; technical audit; technical Piaseczno; Stryków) consulting

Faurecia Wa∏brzych; BPTO Pluton; RONDO Property Investments

288 1998

Artur Tomczyk

WND 1994

Patrick Delcol

167 167

PM: Project development; leasing; center management; marketing; asset management; FM: Environmental services; technical services; energy management

PM: Centrum Tulipan (¸ódê); Centrum Ster (Szczecin); M1 Shopping Centers; Centrum Praktiker; GE Real Estate Ursynów (Warsaw); Centrum Holdings; Apollo Rida; Brico; Kometa (Toruƒ); FM: Plaza Pradera (Ruda Âlàska; Rybnik); Gemini (Bielsko-Bia∏a); Makro; M1 Shopping Centers

416 1996

Renata Kinde-Czy˝; Clemens Puehler

Comprehensive technical CH Arkadia (Warsaw); French maintenance; cleaning; Embassy (Warsaw); outdoors areas maintenance; Goodman Logistics Center Atrium; BNP Paribas; snow removal; cleaning and (Niepruszew); Crown Goodman; Unibail-Rodamco; unblocking drains; separators production plants (Goleniów; DTZ cleaning; construction Gdaƒski); Golden Tulip reviews; duct cleaning; cost PruszczHotel (Warsaw) optimization

160 2000

Katarzyna Jahan

82 1998

Piotr Kuligowski

Company name Address Tel./Fax E-mail Website

1

Sodexo Polska Sp. z o.o.

Al. Jerozolimskie 172, 02-486 Warsaw 22 338-9600/22 338-9601 info.fms.pl@sodexo.com www.sodexo.pl

2

Dalkia Energy & Technical Services Sp. z o.o.

Al. SolidarnoÊci 46, 61-696 Poznaƒ 61 829-9260/61 829-9288 dets@dalkia.pl www.dalkia.pl

✓

2,529,838 2,529,838

3

HOCHTIEF Facility Management Polska Sp. z o.o. ul. Powsiƒska 64A, 02-903 Warsaw 22 858-8525/22 842-0473 handlowy@hochtief.com.pl www.hochtief-fm.pl

✓

2,280,000 2,280,000

115 115

-

-

2,280,000 2,280,000

115 115

4

DTZ Management Polska Sp. z o.o. ul. Z∏ota 59, 00-120 Warsaw 22 222-3000/22 222-3001 info@dtz.com www.dtz.com/pl

✓ -

2,160,000 2,160,000

46 46

2,160,000 2,160,000

46 46

-

-

5

METRO Properties Sp. z o.o.

Al. Krakowska 61, 02-183 Warsaw 22 500-0000/22 500-0113 info@metro-properties.pl www.metro-properties.pl

6

POL-K ATALIAN Sp. z o.o.

(Dawniej Pol-K Sp. z o.o.) ul. Âlàska 159/1, 32-080 Zabierzów 12 258-0885/12 258-0886 pol-k@pol-k.pl www.pol-k.pl

✓ ✓

2,033,901 2,033,901

180 180

588,436 588,436

13 13

1,445,465 1,445,465

Services offered

Comprehensive energy and technical services

Buildings managed

Selected clients

Z∏ote Tarasy (Warsaw); Millennium Hall (Rzeszów); CBRE Global Investors; Galeria Pomorska Ghelamco; Corpus Sireo; Arka Comprehensive PM services (Bydgoszcz); Mokotów Nova BZ WBK; AIB; Balmain Asset (Warsaw); Marynarska 12 Management; Credit Suisse (Warsaw); Trinity Park II Asset Management; VALAD (Warsaw)

Total number of employees / Year founded in Poland

Services: PM / FM

Gross building area (GBA) managed (sqm): Owned by company / Not owned by company / Total

Przewodnik po polskim biznesie i gospodarce

Rank

A guide to Polish business and industry

Top local executive / Title

Yann Gontard CEO Central Europe

President; Board Member

President

Country Head

President; Board Member

✓

2,000,000 2,000,000

210 210

-

-

2,000,000 2,000,000

210 210

7

Atrium 21 Sp. z o.o. ul. Stefana Batorego 20, 02-591 Warsaw 22 825-9892/22 825-0440 info@atrium21.pl www.atrium21.pl

✓ ✓

1,300,000 1,300,000

120 120

1,290,000 1,290,000

117 117

10,000 10,000

3 3

PM: WM Park Mokotów I PM: Administration; (Warsaw); WM Suita economic support and (Warsaw); WM Delicato financial services; FM: (Warsaw); WM Cameratta Cleaning; technical (Warsaw); FM: Buildings on maintenance; consulting and ul.

Stefana Batorego 14 and expert services 20 (Warsaw)

8

Knight Frank Sp. z o.o. ul. Mokotowska 49, 00-542 Warsaw 22 596-5050/22 596-5051 office@pl.knightfrank.com www.knightfrank.com.pl

✓ -

1,160,000 1,160,000

77 77

1,160,000 1,160,000

77 77

-

-

Intercontinental Hotel DEKA Immobilien; SEB Full range of property and (Warsaw); North Gate Investment; Arka WZWBK asset management services; (Warsaw); Trinity Park III Fundusz NieruchomoÊci; cost analysis; contract (Warsaw); Andersia Business Peakside Polonia renegotiation; tenders Centre (Poznaƒ); Bema Plaza Management; Invesco Real organization (Wroc∏aw) Estate

104 1995

Przedsi´biorstwo Zarzàdzania NieruchomoÊciami Sp. z o.o. ul. Niek∏aƒska 35, 03-924 Warsaw 22 518-8800/22 518-8802 sekretariat@pzn.com.pl www.pzn.com.pl

✓

1,150,000 1,150,000

2,472 2,472

-

-

1,150,000 1,150,000

2,472 2,472

Facility management; technical maintenance; cleaning; technical protection of property

569 1996

Jerzy Zalega

140 2004

Piotr Górnicki

Echo; KBC; BRE Bank; Skanska; Arka BZ WBK; First Property

210 1997

Jan Woêniak

PM: Warsaw Financial Center PM: Comprehensive real (Warsaw); Platinium Business IVG Poland; Allianz Real estate services; asset Park (Warsaw); Horizon Plaza Estate/Tristan Capital management; FM: Technical (Warsaw); Grunwaldzki Partners; Union Investment maintenance; building Center (Wroc∏aw); Senator Real Estate; GLL Real Estate maintenance (Warsaw); FM: Warsaw Partners; RREEF Investment Financial Center (Warsaw)

77 2007

Monika Rajska-Woliƒska

9

General Property Sp. z o.o. ul. Wiertnicza 34, 02-952 Warsaw 10 22 642-1125/22 642-2303 info@generalproperty.pl www.generalproperty.pl

✓ ✓

1,100,000 1,100,000

47 47

66,000 66,000

4 4

1,100,000 1,100,000

47 47

PM: Lease contract management; cost optimization; FM: Comprehensive technical maintenance; construction reviews; engineering descriptions

Cofely Services Sp. z o.o. ul. Kijowska 1, 03-738 Warsaw 11 22 518-0186/22 518-0189 cofely@cofely.pl www.cofely.pl

✓

1,020,000 1,020,000

470 470

-

-

1,020,000 1,020,000

470 470

Technical maintenance; energy-efficient investments; facility management

Colliers International REMS Sp. z o.o.

Pl. Pi∏sudskiego 3, 00-078 Warsaw 12 22 331-7800/22 331-7801 warsaw@colliers.com www.colliers.com

✓ ✓

803,750 803,750

45 45

753,750 753,750

44 44

50,000 50,000

1 1

Warbud Vinci Facilities Sp. z o.o.

Al. Jerozolimskie 162A, 02-342 Warsaw 13 22 567-6313/22 567-6401 warbudvf@warbud.pl www.warbud.pl

✓

713,275 713,275

64 64

-

-

713,275 713,275

64 64

✓ -

674,312 674,312

57 57

674,312 674,312

57 57

-

-

Jones Lang LaSalle Sp. z o.o. ul. Królewska 16, 00-103 Warsaw 14 22 318-0000/22 318-0099 warsaw.office@eu.jll.com www.joneslanglasalle.pl Echo Investment Property Management Sp. z o.o., Sp.k.

Al. SolidarnoÊci 36, 25-323 Kielce 15 41 333-3606/41 333-2666 biuro.pm@echo.com.pl www.echo.com.pl

✓ ✓

590,000 55,375 645,375

19 2 21

590,000 55,375 645,375

Notes: FM = Facility Management, GBA = Gross Building Area, PM = Property Management, WND = Would Not Disclose. Research for The List was conducted in February 2013. Number of employees is as of February 2013. All information pertains to the companies’ activities in Poland.

Only the 15 top companies are listed here - for full list subscribe at www.bookoflists.pl

19 2 21

156,000 156,000

3 3

WND

WND

Bank Pekao; PKO BP; Bank Millennium; BRE Bank; BZ WBK

PM: Marki Industrial Park (Marki); Concept Tower (Warsaw); DSV-Miƒska PKO BP; Caelum (Warsaw); FM: Centrum Development; Renault Polska; Finansowe Pu∏awska Raben Polska; Uti Poland; Ret (Warsaw); Blue Point Pro (Warsaw); Eurocentrum (Warsaw); CH Turawa (Opole) BRE (Kraków; Katowice; Bydgoszcz); Park Post´pu (Warsaw); Green Horizon (¸ódê); Henkel production plant (Racibórz)

Proxy

President

Monika D´bska; Joseph Borowski; Katarzyna Bàczyƒska President; Vice President; Managing Director

President

President

President

Managing Partner

Technical maintenance; mobile service; budget management; cleaning; handyman; rebuilding; arranging

Supreme Administrative Court; Prosta Tower; Ferio Wroc∏aw

Jeronimo Martins; Marvipol; Kronos

45 2010

Zbigniew Kucharski

Comprehensive PM and accounting services

Marynarska Business Park (Warsaw); Green Corner (Warsaw); Point Park (Mszczonów); Marcredo Ciechanów (Ciechanów); Centrum Handlowe BELG (Katowice)

Aviva; Balmain; Elbfonds; Heitman; PointPark; Skanska

345 1994

John Duckworth

Echo Investment; Immopoland

66 1998

Piotr Gromniak

PM: Operational PM: Galeria Echo (Kielce); management; reports; Pasa˝ Grunwaldzki (Wroc∏aw); budgets; settlements; lease Galaxy (Szczecin); Park contract management; Post´pu (Warsaw); Oxygen project service organization; (Szczecin); Malta Office Park project marketing; (Poznaƒ); FM: Galeria Echo commercialization support; (Kielce); Galeria Olimpia FM: Technical maintenance (Be∏chatów)

Managing Director

Managing Director CEE

President

To the best of WBJ ’s knowledge, the information is accurate as of press time. While every effort is made to ensure accuracy and thoroughness, omissions and typographical errors may occur. Corrections or additions to The List should be sent, on official letterhead, to Warsaw Business Journal, attn. Monika Brysiak, ul. Elblàska 15/17, 01-747 Warsaw, via fax to (+48) 22 639-8569, or via e-mail to wbjbol@wbj.pl. Copyright 2012, Valkea Media SA. The List may not be reprinted or reproduced in whole or in part without prior written permission of the publisher. Reprints are available.

20

MARKETS

www.wbj.pl

FEBRUARY 25 – MARCH 3, 2013

Stocks report

world stock indices DJIA

NASDAQ

13,880.62 (Feb 21 close)

S&P500

3,131.49 (Feb 21 close)

-0.66% (for the week)

FTSE100

1,502.42 (Feb 21 close)

-2.10% (for the week)

DAX

6,291.50 (Feb 21 close)

-1.25% (for the week)

-0.57% (for the week)

WIG continues to underperform

NIKKEI 7,583.57 (Feb 21 close)

11,309.13 (Feb 21 close)

-0.62% (for the week)

0.02% (for the week)

CHANGE: 3.49% (year to Feb 21)

CHANGE: 0.62% (year to Feb 21)

CHANGE: 2.74% (year to Feb 21)

CHANGE: 4.38% (year to Feb 21)

CHANGE: -2.51% (year to Feb 21)

CHANGE: 5.81% (year to Feb 21)

52-week high: 14,058.27

52-week high: 3,213.60

52-week high: 1,530.94

52-week high: 6,412.40

52-week high: 7,871.79

52-week high: 11,510.52

52-week low: 12,035.09

52-week low: 2,726.68

52-week low: 1,266.74

52-week low: 5,229.80

52-week low: 5,914.43

52-week low: 8,238.96

Andrew Nawrocki WBJ market analyst Polish equities saw little reprieve last week, continuing a slide from the week prior when both the WIG shed 0.79 percent and the WIG20 1.1 percent.

Monday saw a mini-rally that was short-lived, with both the WIG and WIG20 climbing about 0.3 percent.

Shares of Polish telecom TP finally saw a rebound (up 2.8 percent) after losing close to 50 percent of their value between February 11 and 15.

On Tuesday, Polish shares underperformed their Western counterparts. Shares throughout Europe saw gains after Germany’s investor confidence index, ZEW, reported better-than-expected results.

It was the third monthly increase. But the optimism in Germany did not get Polish investors too excited, with the WIG closing relatively flat,

Major indices WIG

45,879.90 (February 21 close)

WIG20

2,436.47 (February 21 close)

Change for the week: -0.72%

52-week high: 48,222.72

Change for the week: -0.81%

52-week high: 2,628.36

Change year to February 21: -4.63%

52-week low: 36,653.28

Change year to February 21: -7.22%

52-week low: 2,035.80

2,600

48,000

2,500

46,400 44,800

2,400

43,200 2,300

21.02

20.02

19.02

18.02

15.02

14.02

13.02

12.02

11.02

08.02

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

21.02

20.02

19.02

18.02

15.02

14.02

13.02

12.02

11.02

08.02

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

28.01

25.01

25.01

2,200

40,000

28.01

41,600

Top 5 EFH HBPOLSKA MEXPOLSKA PBG INTROL

Closing 1.02 0.02 1.44 7.61 6.24

% change (week) 52-week high 500.00 1.60 100.00 1.36 38.46 10.89 33.51 73.15 31.09 6.45

52-week low 0.16 0.01 0.85 3.25 3.11

Top 5 LOTOS PKNORLEN GTC SYNTHOS BORYSZEW

Closing 40.00 53.15 7.80 5.63 0.48

% change (week) 5.35 4.83 3.86 2.74 2.13

52-week high 43.78 54.05 10.25 6.40 0.84

52-week low 22.66 31.44 5.13 4.64 0.42

Bottom 5 KBDOM REGNON BBICAPNFI LIBRA TFONE

Closing 0.10 0.03 0.54 1.43 1.68

% change (week) -37.50 -25.00 -21.74 -18.29 -16.00

52-week low 0.09 0.03 0.51 1.26 1.13

Bottom 5 TAURONPE KGHM TVN TPSA BOGDANKA

Closing 4.27 179.00 9.21 6.78 129.60

% change (week) -6.36 -4.69 -3.15 -3.14 -2.99

52-week high 5.11 194.80 11.69 17.34 143.00

52-week low 3.84 92.14 5.90 6.71 114.00

52-week high 0.21 0.16 1.17 2.39 2.82

Currency report

Outlook upgrade boosts z∏oty

Other indices mWIG40

2,566.08 (February 21 close)

sWIG80

10,948.88 (February 21 close)

Change for the week: -0.47%

52-week high: 2,646.20

Change for the week: -0.62%

Change year to February 21: -0.10%

52-week low: 2,147.52

Change year to February 21: 3.97%

52-week high: 11,245.80 52-week low: 8,984.43

Adam Narczewski X-Trade Brokers DM SA

12,000

2,700 2,660

11,500

2,620 11,000 2,580

32.54 (February 21 close)

WIG-Banki

21.02

20.02

19.02

18.02

15.02

14.02

13.02

12.02

11.02

08.02

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

21.02

20.02

19.02

18.02

15.02

14.02

13.02

12.02

11.02

08.02

07.02

06.02

05.02

04.02

01.02

31.01

30.01

29.01

28.01

25.01

NewConnect

25.01

10,000

2,500

28.01

10,500

2,540

6,382.67 (February 21 close)

SOURCE: WSE

21.02

20.02

19.02

18.02

15.02

14.02

13.02

12.02

11.02

08.02

07.02

06.02

25.01

21.02

20.02

19.02

18.02

15.02

14.02

13.02

12.02

11.02

5,900

08.02

32.0 07.02

6,060

06.02

32.6

05.02

6,220

04.02

33.2

01.02

6,380

31.01

33.8

30.01

6,540

29.01

34.4

28.01

6,700

25.01

35.0

05.02

52-week low: 5,163.30

04.02

Change year to February 21: -5.06%

01.02

52-week low: 32.13

31.01

52-week high: 6,723.16

Change year to February 21: -2.05%

30.01

Change for the week: -1.34%

29.01

52-week high: 43.72

28.01

Change for the week: -0.76%

while the WIG20 reported a mere 0.05 percent gain.

Wednesday, too, saw Polish shares perform poorly, with the WIG20 shedding 1.37 percent, while the WIG closed nearly 1 percent lower.

Fears that France’s credit rating would be slashed pushed indices lower.

Thursday saw Polish shares trading better than their regional peers after news that Fitch upgraded its outlook for Poland’s credit rating helped both the WIG and WIG20. Nevertheless, both ended up shedding close to a quarter of a percent on the day.

On Friday, the two main indices recorded modest gains, with the WIG up 0.15 percent and the WIG20 up 0.03 percent, as the optimism following the outlook upgrade continued. ●

According to the Federal Open Market Committee meeting minutes released last week, the US economy is improving and the Fed is thinking about quitting its asset-buyback program.

While this isn’t about to happen right now, it may occur this summer. The reaction of the EUR/USD was abrupt.

The main currency pair tumbled from $1.34, the level it had been hovering around for the first part of the week, all the way to $1.32. The Fed’s statement was a sudden turn of events for traders, as previously only one FOMC member (James Bullard) had opted for decreasing the quantitative easing program.

Besides the US dollar, the z∏oty was also a gainer this past week. The Fitch rating agency affirmed Poland’s

credit rating at A- and upgraded its outlook to “positive” from “stable.” This stopped the z∏oty from depreciating this past week, and could slow the process of increasing risk premiums this year.

The EUR/PLN, which traded close to the z∏.4.20 resistance level, declined all the way to z∏.4.15. The USD/PLN on the other hand, from a weekly low of z∏.3.09, climbed all the way to z∏.3.15.

The upcoming weeks though could be tough for the z∏oty. The market is awaiting a larger corrective movement on US stock markets, and if that happens, risk aversion will increasingly pull investors out of z∏oty-denominated assets and this will cause a larger depreciation of the z∏oty. ●

currency rates 3.3704 22.02

SOURCE: NBP

20.02

3.3884

3.3528

3.3195

19.02

21.02

3.3404

3.4008 15.02

0.1044

0.1036 22.02

3.3

18.02

PLN-100JPY

3.5

21.02

20.02 0.1032

0.1041

0.1041 19.02

18.02

0.1020

15.02

3.3797 22.02

3.3960 21.02

3.3728 20.02

3.3949 19.02

3.4024 18.02

15.02

3.4061

4.8037 22.02

4.8166

0.1035

3.3

PLN-RUB

0.1050

0.1043

PLN-CHF

3.5

21.02

4.7513 20.02

4.8620

4.8585 19.02

18.02

15.02

3.1633

3.1443 22.02

4.7

4.8584

PLN-GBP

4.9

21.02

3.1002 20.02

3.1360 19.02

18.02

3.1398 15.02

4.1760

4.1574 22.02

3.0

3.1410

PLN-USD

3.2

21.02

20.02

4.1602

4.1863 19.02

18.02

4.1852 15.02

4.1

4.1930

PLN-EUR

4.2

SPORTS

FEBRUARY 25 – MARCH 3, 2013

www.wbj.pl

Szcz´sny comes under fire

Eagles moving to Polonia stadium

The Polish goalkeeper’s form has dipped this season

Warsaw’s top-league American football team will share the 6,800seat stadium with Polonia Warszawa

Polish international goalkeeper Wojciech Szcz´sny has come under strong criticism for his performances for Premier League side Arsenal in recent weeks.

First came a mistake against Blackburn Rovers that led to the second-tier-league side knocking the Gunners out of the FA Cup. Arsenal had completely dominated the match, despite being unable to find the back of the net. Finally, Mr Szcz´sny failed to deal with a shot from Blackburn’s Martin Olsson, and only managed to parry the ball into the path of the Rovers’ Colin KazimRichards. He fired the ball past the stranded Polish keeper to give Blackburn victory.

Then, in last week’s Champions League round of 16 match with Bundesliga giants Bayern Munich, Mr Szcz´sny allowed three goals, with the 3-1 score line virtually ending Arsenal’s involvement in the tournament with the second leg still to play.

The Pole could do little about

Wojciech Szcz´sny (front left) the first and third goals, but was again at fault at the 21-minute mark when he parried a Daniel van Buyten header straight at Thomas Müller, enabling the German midfielder to blast the ball into the Arsenal goal.

Following another less-thanconvincing performance, speculation is mounting that the 22year-old may be replaced in the

summer, with Arsene Wenger finally losing patience with his erratic goalkeeping.

Stoke City’s Simon Mignolet is being touted as the most likely replacement. The Belgian international has been in inspired form for one of the Premier League’s tightest defenses this season.

David Ingham

Last season the Warsaw Eagles, Poland’s oldest American football team, played their games at OSiR Bemowo – a new, but fairly small venue with artificial turf.

Its capacity of a mere 1,000 seats could barely hold the club’s fans.

On average the games were attended by 920 people.

Club owners felt they had outgrown the stadium and needed to move to a bigger space, especially after playing in the Topliga final at the National Stadium in front of 23,000 people (where they lost to Seahawks Gdynia).

For years the stadium on ul.

Konwiktorska has been synonymous with soccer and with Polonia Warszawa.

The “Czarne Koszule” or “Black Shirts” have been playing there since 1928. Even though its official name is Polonia Warszawa stadium, it’s not the property of the club, but is in fact owned by the city and leased to the team.

COURTESY OF MARCIN FIJA∏KOWSKI/WARSAW EAGLES

American football

COURTESY OF WIKIMEDIA COMMONS

Soccer

21

Warsaw Eagles games attracted 920 fans on average last year That’s why, even though initially Polonia protested the Eagles’ move to the facility, in fear of the field being destroyed, they couldn’t block the decision. WOSiR (a cityrun department that manages the facility) reassured the soccer club that the condition of the field won’t deteriorate.

The Warsaw Eagles signed the deal for the upcoming season, and will be paying WOSiR z∏.22,000 per game, while Polonia pays twice as much.

“We understand that the difference is significant, but we know each other’s abilities,” said WOSiR’s director Janusz Kopaniak.

The average attendance for Czarne Koszule games in the last round was 4,400. The Eagles expect that 2,000-4,000 fans will come to their games on ul. Konwiktorska. In the first game of the season on April 6, Eagles will take on their rivals Devils Wroc∏aw.

Jacek Ciesnowski

22

LIFESTYLE

www.wbj.pl

FEBRUARY 25 – MARCH 3, 2013

Exhibition

Concert

Hound of love Patrick Wolf (acoustic) March 2 Palladium ul. Z∏ota 9 Warsaw English singer-songwriter Patrick Wolf is already six albums into his career at just 29 years old. His songs often mix classical musical elements with electronic sam-

ples, with the singer playing a variety of instruments including ukulele, piano, keyboards and viola.

As a result, his music is very eclectic. Some of his songs, which often focus on love and desire, fit into genres such as romantic folk, pop, techno and dance.

For his current tour, which celebrates 10 years in

the business, he’s stripping back the technology to play a strictly acoustic set. This is to promote his latest release “Sundark and Riverlight” which contains the best tracks of his career so far, rerecorded using acoustic instruments.

David Ingham

For more information, log on to palladium.art.pl

COURTESY OF PATRICKWOLF.COM

Patrick Wolf

COURTESY OF TADEUSZ ROLKE/LE GUERN GALLERY

Post-communist reality

Mr Rolke was interested in local and transient phenomena Tadeusz Rolke: Tomorrow Will Be Better Galeria Le Guern Until April 24 ul. Widok 8 Warsaw This photography exhibition highlights Poland’s transformation period of the early 1990s – the first years after the end of communism.

Focusing on the work of Polish photographer Tadeusz Rolke, it details the often difficult combination of pervad-

ing remnants of the old regime with a belief in new possibilities and an enthusiasm for change that emerge during this time in history.

Taken mostly between 1990 and 1992, the photographs include commissioned pieces as well as the artist’s own personal images, helping to document the changing nature of Polish society, which included rampant inflation and a growing disparity between rich and the poor.

Mr Rolke was particularly interested in local and transient phenomena rather than the increased commercialization of the era – unbridled advertising and the large variety of products were nothing new to him, since he lived in West Germany in the 1970s and 1980s.

The exhibition also includes other work from the artist’s long career.

David Ingham

For more information, log on to leguern.pl

LAST WORD

FEBRUARY 25 – MARCH 3, 2013

www.wbj.pl

23

Tech Eye

Sony shows off the PS4. Kind of. of slippery, unpredictable market that Sony and Microsoft are also trying to remain atop. Microsoft has been quiet to date, but Sony finally made its move last week.

At its first event dedicated to the predictably named PlayStation 4 (PS4), Sony made it crystal clear that “social” is key to the experience it

The Dual Shock 4

The hardware in there A quick comparison of Sony’s current and next-gen consoles PS4*

PS3*

“Jaguar”: single-chip x86-64 AMD with 8 cores

“Cell”: multi-core chip

8GB GDDR5

256MB of XDR DRAM (system) / 256MB GDDR3 RAM (video)

Hard-drive

Built-in, size unknown

Built-in, 20/60GB

Optical drive

6x Blu-ray and 8x DVD

2x Blu-ray and 8x DVD

Input/output

Super-Speed USB 3.0, Aux (for PS4 Eye)

USB 2.0, Aux

No (later streaming via cloud)

PS2 games (and some PS1)

CPU Memory

Backward compatibility

* All specs refer to status at launch. The most recent PS3 consoles no longer have backward compatibility.

wants to provide, as evidenced by a dedicated “share” button on the PS4 controller. The console has “always on” video compression and decompression to make uploading gameplay videos simpler, and it offers new possibilities for cooperative play.

In addition to the share button, the Dualshock 4 controller incorporates motion-detection hardware, a speaker and a small touchpad, broadening the palette for interactivity in games. Another peripheral that Sony showed off, the Playstation 4 Eye, aims to provide the same kind of motionsensing/webcam/voice command experience as the popular Kinect hardware from Microsoft.

We didn’t actually get to see the console unit last week, but Sony announced that it is ditching the PS3’s Cell processor architecture in favor of an eightcore, x86-64 AMD chip. That’s likely to please game developers, as the Cell chip has a reputation as powerful but tricksy to program for. The AMD architecture, meanwhile, is much closer to what you find in a PC (and an Xbox), which should make multi-platform game development easier.

Truth be told, the hardware side of

COURTESY OF SONY

nical lightweight (for its generation) which leans heavily on a touchscreenenabled controller, is underperforming badly.

Launching in Q4 2012, Nintendo bet that consumers would be ravenous for the first new console hardware in six years. Judging by the sales figures, it was wrong. In fact, the Wii U’s startlingly poor performance has some experts questioning the future of a company that’s been in the gaming industry since freaking 1889.

This is the kind

These are strange days for the video game industry. Less than a decade ago, analysts were predicting the death of PC gaming, while the console market was dominated by three firms – Microsoft, Nintendo and Sony. The latter two ruled the handheld gaming market, uncontested.

Then came smartphones. And tablets. These devices, with their touchscreens and byte-sized, lowpriced apps, have proven fierce competition for the handheld-gaming sector. They’re also a nascent threat to the still-not-dead PC-gaming sector.

Pity the incumbents in this struggle, such as Nintendo. Today the firm fares better than Sony in the handheld market, but its Wii U console, a tech-

Source: Sony

the PS4 is OK – sassier than the Wii U, to be sure – but hardly exhilarating.

The one big surprise is the addition of a whopping 8GB of GDDR5 RAM, to be shared by system and graphics use. Compare that with the PS3, which has a meager 512MB of RAM split equally between system and graphics.

Sony also wants to make it possible to use a second screen while playing.

But rather than forcing this on players, as Nintendo does with the Wii U controller, the firm will employ its Vita handheld or, smartly, let consumers use their own smartphones or tablets (via iOS or Android app). And while the move to an AMD architecture makes backward compatibility with older games a technical nightmare, the firm plans to circumvent this by streaming games via the cloud.

Finally – and most crucially for the console’s long-term health – there seems to be plenty of developer support for the PS4. Major talent like Blizzard (Diablo 3), CD Projekt RED (The Witcher 3) and Bungie (Destiny) plan to bring their games to the console.

The PS4 is expected to launch in November. Will it prove to be Sony’s salvation? Like the console itself, this remains to be seen. ●

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