WBJ #11 2013

Baby steps

Defensive maneuver

No star power

In a controversial move, the government will subsidize in vitro fertility treatments

US officials were in Poland last week to clarify changes to the planned missile-shield system

Techeye reviews Samsung’s new Galaxy S4

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WWW.WBJ.PL

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VOLUME 19, NUMBER 1 • MARCH 25 – APRIL 1, 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

‘I failed’

COURTESY OF WARSAW CITY HALL

REAL ESTATE

• Interview with Warsaw mayor • Record year for warehouses 14-17 • Soft lofts

Tragic climb Four Polish climbers conquered Broad Peak, but only two came home 4

In this issue News . . . . . . . . . . . . . . . . . . . . . . .2-4 Business . . . . . . . . . . . . . . . . . . . .5-6 Cover Story . . . . . . . . . . . . . . . . .8-9 Opinion & Analysis . . . . . . . . . . . .10 The List . . . . . . . . . . . . . . . . . . . . . .12 Finance & Economics . . . . . . . . . .13 Lokale Immobilia . . . . . . . . . .14-17 Markets . . . . . . . . . . . . . . . . . . . . .20 Sports . . . . . . . . . . . . . . . . . . . . . . .21 Lifestyle . . . . . . . . . . . . . . . . . . . . .22 Last Word . . . . . . . . . . . . . . . . . . . .23

REPORTER

In a wide-ranging exclusive interview, former President Lech Wa∏´sa bemoans the state of Polish democracy 8-9

All eyes on Cyprus

Emergency rescue

Cyprus’ financial woes dominated news and markets last week – and they remain unresolved

Troubled national airline LOT’s restructuring plan will see it cut aircraft, routes and staff 5

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NEWS

www.wbj.pl

A group of miners were rescued after an accident in a mine owned by copper giant KGHM. A 4.7-magnitude earthquake shook the Rudna G∏ówna mine in Polkowice on Tuesday evening, leaving them trapped underground.

Rescuers worked all night to get to the miners and had to use the passages of a neighboring mine to do so. The rescue attempt proved successful on Wednesday morning. All 19 miners were brought back up alive and well.

Polish soldier killed in Afghanistan Polish soldier Private First Class Pawe∏ Ordyƒski was killed in Afghanistan when a land mine exploded beneath the car he was driving.

Two other soldiers were injured in the incident and were flown to hospital in Ghazni.

They’re in stable condition. The soldiers had been on a routine patrol of the area.

Private Ordyƒski was 29 years old. So far, Poland has lost 38 soldiers and a civilian medic in the Afghanistan mission.

Unemployment rises to 14.4%

IN THE SPOTLIGHT

Numbers in the News

Poland’s energy-related court battles

is the average cost of one hour of labor in Poland for employers, according to Eurostat.

z∏.30.4 billion was Poland’s budget deficit in 2012, according to data from the Ministry of Economy.

0.8% is by how much retail sales in Poland fell in February in annual terms.

Quote of the Week

The European Commission has taken Poland and Cyprus to the Court of Justice of the European Union for failing to apply renewable energy rules. The decision comes after the two countries’ failure to implement the EC’s Renewable Energy Directive, which aims to ensure a 20 percent share of renewable energy in the EU’s total energy volume by 2020.

The countries were required to write legislation that would have imposed the rules by December 5, 2010, the EC wrote in a statement. So far, neither country has done so. If the court finds for the European Commission, Poland could pay a pretty penny for its refusal to follow the rules. The Commission proposes a daily penalty of €133,228.80 for Poland.

This is not the first time

Poland has gone to court with the EC over energy-related issues. Back in the beginning of March it lost an appeal seeking to block EU rules on how to allocate free carbon-dioxide permits, claiming they didn’t take into account fuel-usage patterns in individual member states.

Poland is not in a hurry to issue new regulations since currently some 90 percent of the nation’s electricity comes from coal. Last week at the CEE Energy Conference in Warsaw, Ma∏gorzata Mika-Bryska from the economy ministry announced that Poland plans to reduce this number to 60 percent by 2020. Power generation from natural gas is expected to rise notably, as the country invests in unconventional reserves.

Ms Mika-Bryska added

however, that the concept of a “low emission economy” was out of the question for Poland.

Speaking at the same conference, environment ministry advisor Antoni Falkowski said the advent of domestic unconventional gas production would lead to a rise in gas-fired power production in Poland, with renewable generation expected to account for around 15 percent of the fuel mix by the start of the next decade.

To date, no commercial production licenses have been awarded for either shale or tight gas reserves, but exploration permits almost number 150, Mr Falkowski added.

The environment ministry estimates there are 346-768 billion cubic meters of recoverable unconventional reserves in Poland.

“Security must not be based only on allies.”

Foreign Affairs Minister Rados∏aw Sikorski explaining plans to extend and modernize Poland’s defense system.

Figures in focus Unemployment lines Unemployment in Poland’s voivodships, in February 2013 (in %)

25 20 15 10 5 0

Jacek Ciesnowski *Highest in Poland **Lowest in Poland

On WBJ.pl

Source: Central Statistical Office

Company index Acciona ......................................6 Lehman Brothers ....................10

The EU’s fraying ties with the east How effective has the European Union’s Eastern Partnership policy been? Log on to WBJ.pl this week to read an analysis by Stratfor.

Calendar

Prime Minister Donald Tusk has said that he could help reach a compromise on the EU budget for 2014-2020.

He was referring to a statement made by Martin Schulz, president of the European Parliament, who told press agency PAP that the Polish PM should take action if he wants the new EU budget to be approved by the EP. ●

was how many Cypriot MPs voted in favor of a proposed tax on bank deposits.

€7.20

As expected, the registered unemployment rate in Poland rose in February compared to both the previous month and to February 2011, statistics office GUS said. The February 2012 rate was 14.4%, up by 0.2 percentage points month-on-month and by one point yearon-year.

PM offers to help negotiate EU budget

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Wa rm i Za ńsko ch -M o Ku dni azu jaw op rsk sk omo ie* o-P rs k Po omo ie dk rsk ar ie pa Św Lub ckie ięt us ok kie rzy Po skie dla Op skie o L ls Lo ube kie we lsk r S ie ile s Łó ia Po Po dzk la mo ie nd rs o kie Ma ver ∏op all Ma ol zo skie wi ec kie Wi elk Sile op sia ols kie **

19 miners rescued after earthquake

MARCH 25 – APRIL 1, 2013

SHUTTERSTOCK

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March/April 26

CONTEMPORARY ART AUCTION

Event:

At this auction collectors will have a chance to bid on classics of Polish abstract art (works by Stefan Gierowski, Wojciech Fangor, Leon Tarasewicz) and Art Informel (Aleksander Kobzdej). There will also be some surrealist works (Zdzis∏aw Beksiƒski, Jerzy Duda-Gracz).

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

Location:

Web:

Apple ........................................23 LOT ............................................5 Ascomp International..............16 Marvipol ....................................6 Banco Santander SA ................6 Morgan Stanley........................10 Bank of Cyprus..........................3 Mostostal Warszawa ................6 BBI Development ....................16 New Direct ..............................18 Boeing........................................5 Nordea Bank ..........................13 BZ WBK................................6, 13 Oaktree Capital........................14 DHL ..........................................17 DZ Bank Polska ......................13 Okam Capital ..........................14 Embraer ....................................5 Panattoni..................................17

Location:

Web:

artists – bidding starts from z∏.500 for each piece.

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

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‘APPETITE FOR OUTSOURCING’ CONFERENCE

Event:

This conference, organized by Bluevine Consulting with the help of the City of Kielce and Deloitte will focus on development prospects for BPO centers in Kielce and other cities of Eastern Poland.

Kieleckie Centrum Biznesu Al. SolidarnoÊci 34 Kielce www.prospectsinpoland.com

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YOUNG ART AUCTION

Location:

Event:

This edition of the Young Art Auction will present nearly 100 works by young Polish

Web:

Eurolot ......................................5 Pekao ......................................20 European Principal Group ......14 Peter Nielsen & Partners ........4 Gazprom ....................................5 PGNiG ........................................5 Griffin Group ......................14, 15 PKO BP ....................................20 HB Reavis ................................14 Prologis....................................17 HP ............................................16 Real Estate Development........16 Interpromex ............................21 Samsung............................16, 23 J.W. Construction ....................14 Tauron ........................................5 Jones Lang LaSalle ..........16, 17 Unibep......................................14 KBC Groep NV ..........................6 KGHM ........................................2 VIS ............................................14 Kredyt Bank SA ........................6 Warbud ......................................6 Laiki Popular Bank ..................3 X-Trade Brokers ......................20

NEWS

MARCH 25 – APRIL 1, 2013

www.wbj.pl

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The euro zone crisis

Though Cypriot politicians have rejected a controversial tax on deposits, the country may still have to face a bank run, or even insolvency Last week investors all over the world were holding their collective breath waiting for the Cypriot parliament to come up with a solution to the country’s increasingly dire financial straits.

As WBJ went to press, the Mediterranean island nation was desperately trying to come up with nearly €6 billion to avoid bankruptcy, as the Monday deadline set by the EU and the IMF was nearing. If unsuccessful, the European Central Bank was set to cut off emergency support for Cypriot banks, leaving the country insolvent.

On Friday Russia, which is the biggest investor in Cyprus, refused to lend it €5 billion in exchange for a fund the island nation was to form with gas,

banking and other assets.

That left Cyprus with one option, economists said, the creation of a “solidarity fund,” which would reportedly be composed of nationalized pension assets, church property and bonds backed by future state revenues from natural gas production, to plug the gaping hole in its financial system. As of press time, the plan had been widely criticized.

Sinking ship On Thursday, Standard and Poor’s rating agency lowered Cyprus’ rating to CCC, or junk status. Meanwhile, the country’s two largest banks, the Bank of Cyprus and the Laiki Popular Bank, were both under severe duress. Many vendors were refusing to honor credit cards, fearing a collapse of the country’s banking system.

The situation in Cyprus, which had been deteriorating for months, came to a head on Saturday, March 16, when banks in Cyprus froze between 6.75 percent and 9.9 percent on all accounts while lawmak-

ers debated a one-off levy on deposits held in Cypriot banks in an attempt to raise €5.8 billion, the sum demanded by the EU and the IMF as a prerequisite for the €10 billion bailout that Cyprus was to receive.

The outcry was immediate.

As thousands started withdrawing money, ATMs quickly ran out of cash.

In order to prevent a nationwide bank run, financial institutions remained closed throughout the whole of last week and were expected to reopen this Tuesday, March 26.

Among those without access to funds is the Polish embassy in Cyprus. The Polish ambassador in Nicosia has already sent a note to the Cypriot finance minister advising him of the situation and asking for an immediate release of Polish embassy funds.

Trust undermined The short-lived tax proposal, though rejected, has thoroughly undermined investors’ confidence in the European bank-

SHUTTERSTOCK

Cyprus sinking

Cyprus must find nearly €6 billion before the EU and IMF will throw it a lifeline ing system. From now on no one can be sure that other countries, such as Spain or Greece, won’t one day follow in Cyprus’ footsteps.

The euro took a major hit last week, falling to its lowest levels this year against many other currencies. With Cyprus’ financial collapse seemingly looming, potentially forcing it out of the euro zone, investors looked to safe havens. Gold prices saw their biggest weekly rise in four months last week.

The banking sector in Cyprus is eight times bigger than the country’s GDP, as it has attracted a flood of for-

eign capital, predominantly Russian. With its low tax rates and little oversight over the banking system, Cyprus has been a preferred destination both for investors looking to escape steep tax rates in their own countries, as well as for illegal organizations and individuals looking for an easy way to launder money.

Polish companies also transferred money to Cyprus looking for lower taxes. It is estimated that in 2010, Polish companies had as much as €400 million in the Cypriot banking system.

Southern discomfort 10-year bond yields across Europe, March 22 Greece

11.82%

Hungary

6.55%

Portugal

6.02%

Spain

4.88%

Italy

4.59%

Poland

3.93%

UK

1.87%

Czech Republic

1.84%

Sweden

1.81%

Germany

1.37% Source: Trading Economics

Beata Socha

Missile shield

The United States has canceled the final stage of its European missile defense system, but Poland will still play a major role After the United States announced it was scrapping the fourth stage of its European missile-defense system, US State Department officials were in Poland last week assuring Polish officials that parts of the system will still be placed in Poland.

The fourth stage would have seen long-range interceptor missiles placed in the country. Now, only short and medium-range missiles will be stationed in Poland, while the US will place 14 long-range interceptors in Alaska, aimed at deterring North Korea

from a strike.

The third phase of the US plan, which includes building a US Army base in Redzikowo, in northern Poland, is still set to go ahead as scheduled. The administration of US President Barack Obama also wants to put medium-range interceptors there, as part of a NATO missile-defense system meant to protect Europe from a potential Iranian attack.

’Back on the right course’ “Now that the administration has decided to see clearly, America can get back on the right course,” Howard McKeon, chairman of the House Armed Services Committee, said in a statement, lamenting lost time and resources.

The changes in US

defense policy stem from two main factors. One is financial: with debt concerns dominating US politics, it’s hard to persuade politicians to spend billions on devices installed on other continents, even if they are there to protect the US and its interests.

The other is the growing threat from North Korea.

“The United States has missile defense systems in place to protect us from limited ICBM attacks, but North Korea in particular has recently made advances in its capabilities and is engaged in a series of irresponsible and reckless provocations,” US Secretary of Defense Chuck Hagel said.

Russia not a factor Some have suggested that the changes could have also been

made in a nod to Russia, which opposes the shield and has engaged in saber-rattling over the issue. Russian authorities even went as far as to warn that they could carry out preemptive strikes on missile-defense facilities in Eastern Europe if Washington goes ahead with the plan.

“A decision to use destructive force preemptively will be taken if the situation worsens,” said Russian Chief of General Staff Nikolai Makarov last year.

Proponents of the missile shield claim it is good to have an American military presence on Polish soil “just in case” Russia could one day attempt to exert its dominance over the region again.

While in Warsaw last week, US Under Secretary of State for Political Affairs

COURTESY OF THE US DEPARTMENT OF DEFENSE

US reassures Poland over missile defense changes

New US Secretary of Defense Chuck Hagel has announced changes to the missile defense program Wendy Sherman explained that Poland had been notified of the decision before it was made official. Secretary of State John Kerry called his Polish counterpart, Foreign

Minister Rados∏aw Sikorski to break the news.

“Russia was only notified after those calls,” Ms Sherman said.

Jacek Ciesnowski

Gov’t to subsidize in vitro treatments Polish Health Minister Bartosz Ar∏ukowicz announced last week that the government would begin subsidizing the in vitro fertilization procedure through the staterun health system.

As many as 15,000 couples will receive subsidized fertility treatment from the

program, which is set to start on July 1 this year.

“We want to make in vitro treatments available also to couples in financial difficulties,” Minister of Health Bartosz Ar∏ukowicz said.

The approximate cost of one in vitro treatment is

z∏.7,500, according to the authors of the program. The state will pay for three rounds of in vitro treatments, but the couples themselves will have to cover the cost of hormone therapy, which is estimated at z∏.3,000-5,000 per round.

The entire program, which is

to be carried out between July 1, 2013 and June 30, 2016 will cost taxpayers nearly z∏.250 million.

Experts say that in vitro subsidies are a good investment for the state, as they could lead to 6,500 more children being born every year. After 20 years Poland

would have 130,000 more citizens.

The move is controversial. Whether the state should subsidize in vitro fertilization in the state-run health program has been the subject of political debate for years. Conservatives are strongly opposed to the

move, since in vitro fertilization procedures usually involve discarding embryos.

However, under the new program, viable embryos are to be stored until they are used. There is no word yet on what will happen to viable embryos that are not Beata Socha needed.

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NEWS

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MARCH 25 – APRIL 1, 2013

Poland-US relations

Komorowski discusses visas with Biden Could the US finally do away with visas for Poles?

Polish President Bronis∏aw Komorowski met US Vice

President Joe Biden in Rome last Tuesday at the inauguration of Pope Francis. After the meeting President Komorowski told Polish media that he and Mr Biden had discussed

the possibility of the US dropping visas for Poles, and that the US VP had been the one to bring up the issue, which has long vexed Poland-US relations.

President Komorowski said that he understood that changes in the policy were likely to happen soon, with a new proposal that would change the rules for how requirements are set for visa-free travel to the US. He said that Vice President Biden called the resolving the visa issue an “an obligation” for the Obama administration.

Mr Komorowski’s words were confirmed soon afterward. On Thursday, a bipartisan initiative on the matter was introduced in Congress. The

Jobs Originating through Launching Travel (JOLT) Act is ostensibly designed to create jobs and reform outdated visa laws.

“Modernizing the Visa Waiver Program (VWP) specifically will strengthen our national security and enhance relationships with important allies like Poland, who have been denied visa-free travel because of outdated policies,” said US Representative Mike Quigley, one of the draft’s authors. The initiative proposes to expand the VWP to

selected countries, including Poland.

So far Poland has been excluded from the VWP because it doesn’t meet certain criteria, including a low nonimmigrant visa refusal rate: no more than 3 percent as specified in the US’s Immigration and Nationality Act. Poland has signed the necessary security and travel agreements needed to gain admittance into the program. The only thing holding it back is its 10 percent visa refusal rate.

Marta Mardosz

Mountain climbing

President Bronis∏aw Komorowski (second from left) meets US Vice President Joe Biden in Rome last Tuesday

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

Waiving of court fees for debtors on the motion for announcement of bankruptcy On March 8, 2013 the president signed an amendment to the Act on Bankruptcy and Reorganization Law. The change was necessitated by a judgment of the Constitutional Tribunal of May 15, 2012, which ruled that provisions in Art. 32 section 1 of the Act hindered debtors’ right to court proceedings as it didn’t allow those wishing to be declared bankrupt to apply for a release from court fees in the bankruptcy announcement proceedings.

The amendment signed by the president abrogates Art. 32 section 1 of the Act. As a result, any entrepreneur (natural or legal person), under rules set forth in the act on court costs, will be able to apply for a release from court fees while submitting a motion for the announcement of its bankruptcy. For example, courts will be able to grant a release from court fees to a limited liability company, if it proves that it lacks sufficient means to pay them (Art. 103). The changes will come into force after 14 days upon their publication.

E-administration – standardizing applications On March 12, 2013 the government adopted the premises for a draft act on standardization of forms and applications in administration procedures. The standardization is to enable digitization and simplify administration procedures, consequently making it easier for entrepre-

neurs to use e-administration. Over 70 application templates used in administration procedures set forth in 22 acts, are to be made available.

Changes not only in VAT rates On April 1, 2013 some amending provisions to the Act on Tax on Goods and Services will become binding. The changes mostly aim to clarify certain notions and definitions, such as tax representative, tax obligation, rules of establishing a taxable basis, conditions for applying the zero percent tax rate, abated tax rates, subjectand object-based exemptions, input tax deduction, obligations regarding taxpayers’ registration, as well as rules for issuing invoices. The Act comes into force as of April 1, 2013 but a majority of its provisions will become binding from January 1, 2014.

Weeks after Polish mountain climbers’ tragic expedition on Broad Peak, survivors shared their firsthand account of what happened On March 5, four Polish climbers made the first winter ascent of Broad Peak, the 12th-highest mountain in the world. Adam Bielecki and Artur Ma∏ek successfully returned to the base, but Maciej Berbeka and Tomasz Kowalski went missing and are now presumed dead.

“Before we reached the top, we discussed the possibility of withdrawing. But the weather was fine, we felt good, we had top-of-the-line equipment.

There wasn’t a reason to pull back,” said Mr Bielecki during a press conference last week.

Before successfully ascending the peak for the first time in winter, the expedition split.

The first on top was Mr Bielecki, who after a brief pause, immediately started his descent. Shortly thereafter he met his colleagues. “Maciek [Berbeka] just nodded, I told him that I’m happy that after all these years he will finally climb that mountain. Tomek

COURTESY OF WIKIMEDIA COMMONS

COURTESY OF PREZYDENT.PL

Final descent

Broad Peak has claimed more victims [Kowalski] just said that everything was OK,” said Mr Bielecki.

Two steps at a time The next day, the weather took a turn for the worse. “I went out to find them [Mr Kowalski and Mr Berbeka]. I walked for 30 minutes, but when I turned my back I could see that I was only 30 meters from our tent,” explained Mr Ma∏ek.

Expedition chief Krzysztof Wielicki revealed that he was in radio contact with Mr Kowalski during his descent.

“I talked to him the whole night, he said he was very weak. He could take only two

steps at a time. He had signs of pulmonary edema, people easily tire when they contract it,” he explained, adding that the last contact with Mr Kowalski was at 6:30 am.

The tragic events put a shadow on the success of Polish mountain climbers. They were the first to successfully climb Broad Peak during winter.

Only two Himalayan giants, K2 and Nanga Parbat, remain unclimbed in the winter.

There are 14 8,000-meter peaks in the world, of which 12 have been ascended in winter.

Ten of those (including Broad Peak) were first ascended in winter by Poles.

Jacek Ciesnowski

New ordinance on fiscal cash registers Recently, a new draft ordinance on fiscal cash registers has been proposed. The draft makes registering every sale mandatory. All payments received before the sale will have to be registered at the moment they are received. Moreover, the draft ordinance regulates in detail the rules for returning goods and lodging complaints, as well as a procedure in case of so-called evident mistakes. With some exceptions, each cash register should undergo technical inspection at least every 2 years. The ordinance is to come into force on April, 1 2013. ●

BROUGHT TO YOU BY PETER NIELSEN & PARTNERS LAW OFFICE

Sikorski outlines Poland’s foreign policy goals Foreign Minister Rados∏aw Sikorski outlined Poland’s foreign affairs priorities for 2013 in a policy speech before parliament last week. Notably, it focused on a more distanced, pragmatic approach to PolandUS relations, and an effort to strengthen ties with France.

In his speech, Mr Sikorski also focused on European issues, saying Poland has a

chance to join the “inner circle” of decision-makers in Europe.

However, he added, the European Union is still in crisis and its survival is “not guaranteed.”

“We all feel that the question of European integration is a question of our security and the power of Western civilization,” he added. He also repeated Poland’s resolve to join the euro zone.

Prime Minister Donald Tusk, meanwhile, said Mr Sikorski had “accurately outlined our strategic perspective.”

“The whole foreign policy of my government can be described in one sentence: more Poland in Europe, more Europe in Poland.

Those are the conditions for our security from a strategic point of view,” said Mr Tusk.

Remi Adekoya

BUSINESS

MARCH 25 – APRIL 1, 2013

www.wbj.pl

5

LOT

LOT’s rescue plan: reduce planes, routes, staff Poland’s troubled state-owned airline LOT submitted its restructuring plan to the Ministry of Treasury last week, with the goal of putting its finances back on track. The details were not supposed to be made public. “Because of the sensitivity of the proceedings with the European Commission and trade secrets, we’re not able to provide specifics,” explained Treasury spokesperson Katarzyna Koz∏owska.

Nevertheless, daily Dziennik Gazeta Prawna published some of the details it said it received from unnamed sources. According to the report, the plan puts its main focus on reducing the number of planes LOT will fly. The company plans to offload 29 Embraer planes, including five recently purchased 195 models. These would be replaced

by Boeing’s 737-800, which will also replace some of the older 737 planes currently used by LOT. Three of the airline’s Boeing 767 aircraft will be returned to the companies they are being leased from.

Cutting the fat Long-distance flights will be operated only by Boeing 787 Dreamliners, of which LOT expects to have five by the end of the year. Currently, all commercial Dreamliners worldwide – including the two LOT has already received from Boeing – are grounded due to battery issues. Boeing has said it expects LOT’s aircraft to be operational “by summer,” but that time frame hasn’t been confirmed and won’t be for weeks, because additional tests are needed.

LOT’s decision to cut the number of planes it uses coincides with cuts in the number of routes it will operate. The carrier wants to concentrate on medium- and long-haul flights.

Shorter routes, such as those to Vienna and Prague, will be removed from the schedule.

Only flights to selected European cities, including London and Madrid, will remain on the map of destinations.

LOT also plans to stop operating its domestic routes.

They would be serviced by Eurolot, a smaller airline coowned by LOT. The air carrier likewise plans to reduce its staff. Currently, the company employs

COURTESY OF LOT POLISH AIRLINES

The troubled airline’s “secret” restructuring plan looks to make it leaner

LOT’s restructuring plan depends a lot on its Dreamliner aircraft 2,100 people (some 1,100 of which are flight personnel).

According to Polish media, nearly 700 of them will lose their jobs (360 office staff and 320 flight personnel). However Marek K∏uciƒski, the company’s spokesperson, has so far only confirmed that 360 office staff will lose their jobs.

New Gazprom deal boosts PGNiG’s results management announced.

PGNiG sold almost 15 billion cubic meters of gas last year and bought about 60 percent of the volume from Gazprom. In November last year it agreed to lower the price of the long-term contract with the Russian company by more than 10 percent, saying it would boost earnings before interest, taxes, depreciation and amortization, or EBITDA, by as much as z∏.3 billion.

COURTESY OF PGNIG

Poland’s gas giant PGNiG announced that its Q4 profit jumped fivefold following agreement on a price cut in its import contract with Russia’s Gazprom.

PGNiG’s net income rose to z∏.2.19 billion from z∏.431 million a year earlier. The Q4 profit helped the state-controlled company raise its annual net income to z∏.2.24 billion, compared to z∏.1.75 billion in 2011, the firm’s

PGNiG had a profitable fourth quarter of 2012

PGNiG maintained its plan to increase gas output to 4.8 billion cubic meters this year from 4.4 billion cubic meters in 2012 as it starts production at its Norwegian offshore well.

The company plans to raise gas production to 6.2 billion cubic meters in 2015, start output of shale gas and further increase imports from western Europe to cut its dependence on Russian supplies.

PGNiG CEO Gra˝yna Piotrowska-Oliwa stressed that the company was conducting 13 shale gas pilot drillings and 20 conventional drillings. PGNiG has earmarked z∏.2.4 billion for exploration and extraction activities in 2013, she added.

Ms Piotrowska-Oliwa said the company was also entering the energy production sector, including a gas power unit in Stalowa Wola with energy giant Tauron and a gas and steam power unit in Warsaw.

“Our aim is to maintain the leading position in a lessmonopolized market and create a multi-energy holding,” Ms Piotrowska-Oliwa said.

AS

He has yet to confirm the cuts for pilots or flight attendants.

The rescue plan is crucial to the company’s future.

Without its approval by the European Commission, the airline will have to return the z∏.400 million emergency loan it received from the State Treasury in December. The

company is deep in the red: in 2012 it lost some z∏.200 million according to Treasury estimates. Over the past 13 years it has lost a total of some z∏.4 billion, according to various calculations by private shareholders and union representatives.

The Treasury hopes to sell

the airline to a private investor in the near future. Last Friday, Treasury Minister Miko∏aj Budzanowski said that he expects the rescue plan to save LOT z∏.150 million this year alone, and that he predicts that the airline will be profitable by 2014.

Jacek Ciesnowski

BUSINESS

www.wbj.pl

MARCH 25 – APRIL 1, 2013

Construction

Marvipol claims it could lose some z∏.100 million due to Mostostal Warszawa refusing to finish work Construction on the z∏.160 million Osiedle Zielona Italia housing estate in Warsaw’s western W∏ochy district came to a screeching halt in early March. The scheme’s developer, Marvipol, is accusing general contractor Mostostal Warszawa of “running away” from the site without finishing its work.

Mostostal, for its part, says it has finished the work it was contracted to do, but that Marvipol simply refuses to accept it. “We have told them multiple times that we completed our work and we are ready to hand it over,” said Mostostal Warszawa spokesperson Karolina Myszkiewicz. “But Marvipol doesn’t want to accept delivery.”

The developer maintains that the work is in fact not complete, but rather “in advanced stages of completion, which is against the agreement that we signed,” according to S∏awomir Hor-

baczewski, vice president of Marvipol. He said the work stoppage could cost the company as much as z∏.100 million.

Mostostal denies these allegations, saying that on March 11 Marvipol received occupancy permits for two of the buildings it built, which “proves the fact that their construction has been completed,” reads the company’s statement. Mostostal claims that Marvipol owes it some z∏.40 million for the finished work, plus z∏.16 million for withdrawing from their agreement.

Trouble building The conflict could have a crucial impact on both companies. Mostostal Warszawa reportedly has cash-flow issues, and the conflict is not the first time that the contractor has been accused of exiting a site too early. In October last year it left the construction site of the Narodowe Forum Muzyki in Wroc∏aw before work was finished, demanding a reworked contract. It also experienced multiple issues with building various sections of highway last year.

“When observing the cash

KBC Groep NV and Banco Santander SA sold 16.2 percent and 5.2 percent stakes, respectively, in Bank Zachodni WBK last week. The banks sold 19.9 million shares at z∏.245 each to financial investors in a transaction worth z∏.4.89 billion.

Santander sold 5.2 percent of Bank Zachodni, cutting its stake to 70 percent, while KBC sold its entire share in

the Polish bank.

Santander, which completed Bank Zachodni’s merger with KBC’s Kredyt Bank SA in January, is under pressure from Polish regulators to boost the proportion of Bank Zachodni shares available to other investors.

The sale will increase the Polish bank’s free float to 30 percent.

COURTESY OF MARVIPOL

Developer, contractor lock horns over work stoppage

BZ WBK stakes sold for nearly z∏.5 billion

Marvipol says that the Zielona Italia investment (visualization pictured) will be completed as scheduled flow, you can see that their key projects are not profitable. Right now most of the company’s activities are financed thanks to loans from its [largest] shareholder, Spain’s Acciona,” BZ WBK analyst Adrian Kyrcz told daily Dziennik Gazeta Prawna.

Marvipol has difficulties of its own. It just announced last week that it will not publish its financial forecast for 2013 because it failed to find investors for a new series of shares it planned to issue, cit-

ing a “difficult and unstable market situation.”

The developer has already signed a letter of intent with Polish contractor Warbud to continue building the Osiedle Zielona Italia housing estate.

Marvipol says it has the money to finish the project, but vows to charge Mostostal Warszawa for every additional penny it spends.

Whether it finally gets what it is looking for will be up to the courts.

Jacek Ciesnowski

COURTESY OF BZ WBK

6

BZ WBK’s headquarters in Warsaw

JC

8

COVER STORY

www.wbj.pl

MARCH 25 – APRIL 1, 2013

Exclusive interview

’I am a loser, despite the fact that I won’ WBJ sat down with Nobel Peace Prize laureate, former Polish president and legendary Solidarity leader, Lech Wa∏´sa, to discuss modern-day Poland and its current government, European affairs, the state of capitalism today and his recent controversial remarks about homosexuals.

Remi Adekoya: You said recently that you consider yourself a man who failed at everything in politics because Polish reality today is not what you had in mind when you were fighting for democracy. But in this country’s over 1,000-year history, never have Poles been as rich or as safe as they are today – thanks in part to you. Do you really consider Poland a failure?

Lech Wa∏´sa: I wouldn’t go so far as to call Poland a failure. I was referring rather to myself and a fragment of my life. It is true that I led the country to freedom. It is also true that I handed over freedom and democracy to the nation even though I had another option.

Knowing then that the country was not ready for democracy, that there was no pluralism, no qualified technocrats, I could have decided to stay at the helm of affairs for longer until the nation was ready.

But I chose democracy and handed over power. As a result, the Gdaƒsk shipyard that catapulted me into the limelight has now been practically closed. Friends of mine who worked with me in the shipyard then have huge [financial] problems today.

And so I failed regarding the Gdaƒsk shipyard.

I also failed regarding democracy, because politicians in Poland today focus on matters of secondary importance.

When I became president in 1990, I wanted to give every

Pole the the equivalent of $10,000. I wanted Poles to receive that money so they could become owners of property. But I was opposed and what was the consequence of that?

Everything went into foreign hands, not Polish. The streets belong to us but the buildings belong to foreigners.

And so here again I lost. So despite the fact that many steps I took then were right, the effects today are hardly inspirational. From that point of view, I am a loser, despite the fact that I won.

But in comparison to many other post-communist countries in this region, Poland is doing quite well, wouldn’t you say?

You have to remember that Poland is a country with great traditions and a great history. So our aspirations are not small.

My countrymen were poor at the beginning of the transformation so they couldn’t buy anything and ended up getting bought. Now if we wanted to get back what we sold we would have to pay a lot of money.

So apart from the $10,000 you wanted to give every Pole, did you have any other plan to solve this issue then?

I had a program that I couldn’t announce in the 1990 presidential campaign because it was too far-reaching. I wanted a presidential system in Poland, government by decree, so I could act fast and keep pace with the criminals trying to make fast money.

COURTESY OF THE EUROPEAN PARLIAMENT

Mr Wa∏´sa also answered questions as to his recent suggestions that back in the mid-1990s he was encouraged to stage a coup against Aleksander KwaÊniewski, who took over the presidential mantle from him

“I failed, I only did the job halfway,” said former President Lech Wa∏´sa about his time in office My decrees would have forced parliament to address an issue quickly, if not, the decrees would automatically go into effect. But as a man who fought for democracy, I have to accept the current state of affairs. I have to agree even though I disagree. I disagree privately but agree publicly.

Recently, you have often repeated that capitalism in its current form will not survive the next century. Why do you think so?

I observed all the recent protests around the globe, in Egypt, in the US and in other countries. I noticed that all those protests are against the system, against capitalism. Of course capitalism is different in various countries. In the US it is a bit more just, in other countries it is less just.

But all those protests were essentially against capitalism.

All the reasonable protesters said they are not against economic freedom and private property, but they simply want the owners of this world to take responsibility for jobs and unemployment.

It is these owners who understand the labor market well; governments can help but it is these owners who should be responsible for jobs.

The protesters didn’t say this directly but as a revolutionary, I sensed their motivations.

In this century, we need three times more capitalists than we currently have. By that I mean we need three times more people who actually own stuff, not just loans and mortgages. We need more people to feel like beneficiaries of capitalism, shareholders

in the system and not just defenseless observers.

If we don’t act, demagogues and populists will destroy everything. Communism was wrong because it took everything away from the capitalists. I don’t want that.

But if the capitalists don’t share a little of their wealth, then people will take if from them by force one day.

Today, educated young people have to have jobs. They don’t give a hoot where the jobs are supposed to come from, they need jobs, period.

And don’t tell me there are no jobs. There were no jobs when we were taking part in a rat race, trying to outdo each other in cost-cutting.

In that scenario, the weak fell by the wayside. But if we don’t want that kind of rat-race again, we have to take care of

the average Joes and the losers.

Let’s leave the best alone, they will cope. But there have to be programs for the losers. Business must start thinking how to give failures jobs and still make money on them.

And don’t tell me there are no jobs because there is a huge amount of capital around the globe, only that it travels from place to place constantly. After all, people must survive somehow, if they can’t afford the basics, they will steal and plot crimes.

Speaking of demagoguery, do you agree with those who say there is a threat of aggressive, right-wing populism rearing its ugly head in Poland today?

Poland has to be understood a little differently. Because of our history, we have learned to be vigilant, always wondering: will

COVER STORY

MARCH 25 – APRIL 1, 2013

This will end badly.

I propose we agree amongst ourselves on some common rules. Is there anything that can unite believers and atheists, Christians and Muslims? We have to agree on a new set of ten commandments, what is allowed and what is not allowed. And then everybody must adhere to them. But in Europe we have not yet decided in which direction exactly we want to move.

So they are in search of an enemy?

Exactly.

Is Poland today strong enough to initiate and try to shape such a discussion?

Poland has wisdom acquired thanks to its historical experience while the Germans have money. Theoretically, we could try to start such a discussion but only the strongest are capable of pushing it forward.

And in your opinion, in what direction is Europe going today?

Europe is in acceleration mode, but nobody has thought about which direction to go yet. What is meant to unite all of us?

There are two concepts. The first group believes that the most important thing is freedom: economic freedom and democratic freedom.

The second group talks about values, but here too there is disagreement over what kind of values should reign supreme.

There is no consensus on these issues and so we push Europe forward chaotically towards things that are necessary but without an agreed-upon foundation.

You travel around the world a lot. From your encounters do you think Poland’s image has improved in the eyes of foreigners?

The answer to that is not so simple. Masses everywhere are the same but in the West, there is political correctness. Nobody wants to risk trouble by offending and so nobody will actually tell you what they really think.

Some say we don’t respect minorities in Poland. That is not true, it is simply the case that in Poland people discuss such issues openly, they are less politically correct but they say what they really think.

In the West, people are even more unhappy with many social realities than here in Poland,

COURTESY OF THE EUROPEAN PARLIAMENT

the Russians invade or will the Germans invade and if they do for what reason?

We had to be vigilant all the time. And today that vigilant nature of ours feels instinctively that the reality surrounding us is not really what we had wanted, this EU is not the one we wanted, the democracy we have is not the kind we wanted.

And so people protest even though they don’t really know whom to protest against. It so happens that it is right-wing extremists that are well-organized and so they loudly question all those leftist ideologies such as those regarding sexual minorities. They have to fight against something, after all.

www.wbj.pl

Lech Wa∏´sa has “no regrets” about his controversial comments on homosexuals but they won’t say it because they are afraid to say what they really think and get into trouble. But I know there is a danger in this kind of openness in Poland.

If the masses are encouraged to express their views too openly they could go and physically attack those they don’t like. We don’t want that. The question then is how do we encourage people to say what they really think without using violence.

You have made some controversial comments recently yourself, namely that gay politicians should sit in the back rows of parliament or even behind a wall. That infuriated many homosexuals and hurt more than a few. Do you sympathize with their pain, at least on a human level?

Lech Wa∏´sa was born in 1943 in Popowo, in north-central Poland. He finished trade school and became an electrician, going to work in the Gdaƒsk Shipyard in 1967.

In 1970, Mr Wa∏´sa was one of the leaders of a strike that was later crushed by authorities. However, in 1980, he successfully led workers in a strike at the shipyard which culminated in the creation of the Solidarity labor union, the first independent such association in communist Poland.

In 1981, he was elected leader of Solidarity and named Time Magazine’s Man of The Year. After the communist government declared martial law in December 1981, Mr Wa∏´sa was arrested and interned.

But he resisted communist pressure to let Solidarity be disbanded and emerged from internment a national hero. In 1983, he was awarded the Nobel Peace Prize.

Mr Wa∏´sa helped negotiate the Round Table Agreement that saw the peaceful end of communism and the ushering in of democracy and a free-market economy. He was elected president in 1990 but lost his reRA Lech Wa∏´sa, when he was winning election bid in 1995.

COURTESY OF THE MINISTRY OF FORIEGN AFFAIRS

Lech Wa∏´sa

I raised the issue inadvertently.

If I had wanted to raise the issue myself I would have spoken in a more unifying manner but I was drawn out on the issue by a journalist and so I spoke less diplomatically.

But they immediately activated their influence because they build their strength on hurt and resentment. They want to make money off me. I feel offended and humiliated by what they have said about me.

How can you say that I am a xenophobe and that I am fighting minorities?

I tell them no, no, no, I have always fought for minorities.

But I will also always tell them to remember that they are minorities and cannot be above the majority. We respect you but you should respect us as well. I understand that they take these kinds of comments personally, again I respect them, but I wouldn’t like them to draw the weaker [heterosexuals] into their fold.

Democracy should be a model in which parliament reflects the makeup of society.

What I said was that if parliament today were indeed a reflection of society, then there would be no homosexuals there, speaking from a statistical point of view. But now I will continue speaking critically of them because they humiliated me and labeled me with terms I do not deserve.

Do you really feel humiliated

by LGBT activists, after your statements?

Yes, I was humiliated by them. I have already had one lecture called off in the US. Political correctness rules there, so I will have losses. Too bad.

So you still don’t regret those words?

I don’t.

And you still refuse to meet with Robert Biedroƒ, Poland’s first openly gay MP, who has said he would like to meet you to explain his point of view?

The problem is that I will not change his lifestyle and neither will he change mine so what sense is there in us meeting? It would be a waste of my time as well as his. He wants me to start patting him on the head but I am not going to do that.

We are nearing the third anniversary of the Smolensk catastrophe in which President Lech Kaczyƒski perished along with 95 others. What lesson do Poles need to learn from that tragedy?

The 1940 Katyn massacre was a huge crime, but some politicians tried to use it for political purposes. There are subjects which are sacred and should never be used for politics.

But here we had a president [Lech Kaczyƒski] who, uninvited for the 60th anniversary of the Katyn massacre, still went there and tried to steal the limelight from Prime Minister Donald Tusk who had been invited to the ceremony.

Lech Kaczyƒski should never have made that trip in the first place. Add to that poor preparations for the trip and we ended up with a tragedy. Today, those whose actions led to that tragedy are trying to convince people that it was an assassination so they can ease their guilty conscience.

So the lesson people should learn from that tragedy is that you shouldn’t bring holy matters into politics because it will end badly.

How do you grade Prime Minister Donald Tusk’s government’s performance over the past six years?

You know what they say, in the land of the blind, the one-eyed man is king. If I had a better choice, I would try to encourage a change of government but right now there is nothing better on the political scene in Poland. The opposition parties don’t even guarantee the same level we get from this government.

If we don’t change our electoral laws whereby parties that get into parliament receive huge state subsidies while those outside get nothing and can’t compete, then no party which is small today will ever get to the microphone. Until we change those rules, nothing will change in our politics.

9

And what do you think of the chances of your former rival, ex-president Aleksander KwaÊniewski, who has announced a new political initiative called Europe Plus?

I don’t think he has much of a chance, but it is good that such initiatives are emerging because that keeps those ruling on their toes.

On a personal note, is there a moment in your long political career in which you felt very moved?

I had ideas and I simply worked towards them, so I didn’t go through any particularly emotional moments.

Maybe sometimes there were emotions, but then I quickly started thinking, “OK, what needs to be done next?” I didn’t experience any strong emotions be they positive or negative.

Did you make any mistakes while president?

Yes, many mistakes, but not on the big issues. I resolved the big issues well. And it is good that I handed over power to the nation despite the fact that some people tried to convince me not to allow KwaÊniewski rule Poland.

You were encouraged to carry out a coup?

I wouldn’t go that far. But I was told that the prime minister of Poland at the time, Józef Oleksy, was a Russian agent and how could I now allow another Russian agent, namely KwaÊniewski, to be president.

They said foreign influence in Poland would be too strong. “Do something about it,” they told me. Nobody talks about a coup directly, it’s much too delicate an issue. So I considered whether it would be good if I hand over democracy or whether I should stay there till the nation matured.

I chose democracy.

And you believe that is how history will remember you?

Yes, but I wasn’t always effective.

Weren’t you effective some of the time?

I was effective in leading to freedom but as a president, like I mentioned earlier, I wanted to propose a presidential system and government by decree. I thought I would be able to push through those changes in my second term as president but I never got a second term. That’s why I failed, I only did the job halfway. ●

10

OPINION & ANALYSIS

www.wbj.pl

MARCH 25 – APRIL 1, 2013

Rolling the dice in Cyprus Ashoka Mody

T

he task was never going to be an easy one: impose losses worth about €5.8 billion ($7.5 billion) on lenders to the Cypriot government and depositors with the country’s banks. And now that effort has led Europe to its latest impasse.

In marathon negotiations, the Cypriot government, under the supervision of the troika (the European Commission, the European Central Bank, and the International Monetary Fund), agreed to a onetime “tax” on bank deposits. But, despite an amendment to exempt accounts containing less than €20,000, the Cypriot parliament overwhelmingly rejected the plan, leaving Cyprus – and Europe – in limbo.

In fact, large depositors are not unlike senior bondholders, and the proposed haircut was a small but welcome step forward. But, because it did not go far enough, a hole remained. There were other options.

Lee Buchheit, the veteran sovereign-debt attorney who should have been in the negotiating room, and Mitu Gulati of Duke University have proposed an elegant “reprofiling” of Cyprus’s €15 billion sovereign debt that would instantly reduce the financing pressure on the country.

But such considerations were off the table well before the deliberations began.

Immeasurable damage Instead, the initial decision was to confiscate just under €3 billion from accounts containing less than €100,000 – the cutoff for deposit insurance. Make no mistake: this would have been the greatest policy error since the start of the financial crisis five years ago. Indeed, the proposal amounted to a rupture with the near-universal agreement that small depositors should be considered sacrosanct. After all, televised news footage of panicked depositors in long lines outside banks and at ATMs can cause immeasurable financial damage far beyond a country’s borders.

Historians will argue whether forcing Lehman Brothers into bankruptcy in September 2008 precipitated the subsequent global financial crisis. Vincent Reinhart, formerly of the US Federal Reserve and now at Morgan Stanley, has argued that the Lehman decision was correct (the error came earlier, with the bailout of Bear Stearns, which created an

expectation that all banks would be bailed out). Private risks must be privately borne.

By contrast, the proposal to impose losses on small Cypriot depositors had no redeeming justification whatsoever. As in Ireland, the most vulnerable were being asked to take the hit, while large depositors were let off lightly and other lenders were to be spared. But it gets worse.

There has never been an official explanation of why lenders to a sovereign should not share the pain, despite the “no bailout” principle on which the euro zone was founded.

Most observers cite the authorities’ concern that if any sovereign does not honor its debts, all sovereign borrowers will be penalized. But such contagion risk is trivial compared to the wildfire that could be ignited by imposing losses on small depositors.

the troika for the past year. And yet, despite all of the preparation, a night of closed-door negotiations led to a stunningly elementary error.

Compounding that error was the absence of any substantive decision concerning how to extricate Cyprus from its downward spiral. Cypriot debt, we are told, will rise to 140 percent of GDP, but will fall to about 100 percent of GDP in less than a decade. This appears to be another replay of the Greek scenario, with targets for reducing the debt burden repeatedly missed, until more drastic steps become inevitable.

Risky system Most important, no restructuring of Cypriot banks appears imminent;

on the contrary, the intent seems to be to keep large depositors from fleeing and preserve the highly risky system. The Central Bank of Cyprus has provided large loans to Cypriot banks under the Emergency Liquidity Assistance arrangement, implying that the collateral offered did not meet the standards of the ECB. More train wrecks are in the making.

The problems in Cyprus now threaten international financial stability. If the idea of a European banking union is serious, now is the moment to advance it. That means reaffirming the commitment to deposit insurance, closing unviable banks, and recapitalizing the rest with European (not Cypriot) funds.

The troika’s decision on Cyprus was akin to policy-making by rolling

the dice. The coming days will reveal the extent of the immediate damage that it has caused. But, with another display of reactive and ad hoc decision-making, we are no wiser about how Europe intends to resolve its dilemmas. Could the Cypriot setback catalyze a fresh start? ●

Ashoka Mody, a former mission chief for Germany and Ireland at the International Monetary Fund, is currently visiting professor of international economic policy at the Woodrow Wilson School of Public and International Affairs, Princeton University.

Copyright: Project Syndicate, 2013.

Project-syndicate.org

Elementary error In mid-2007, Cyprus qualified for euro zone membership by meeting the stringent Maastricht criteria, intended to ensure that new entrants would behave responsibly and flourish in the secure environment provided by the currency union. In the months leading up to the decision, the IMF urged Cyprus to take all necessary steps to ensure a favorable outcome.

The benefits of Cyprus’s adoption of the euro may never be clear.

By 2009, the IMF’s Article IV Staff Report was already ringing the alarm bells. Public debt was still low, but growing rapidly; the current-account deficit was ballooning (reaching 15 percent of GDP in 2008); and the banks had gone Icelandic, with assets worth more than three times Cyprus’s GDP. As the report noted, the huge and highly concentrated banking sector’s problems could “quickly escalate to systemic proportions with serious economic repercussions.” And so they have.

This is a remarkable outcome, given that the risks have been so well known and understood. Indeed, the Cypriot authorities have been engaged in ongoing discussions with

“The proposal amounted to a rupture with the nearuniversal agreement that small depositors should be considered sacrosanct.”

CK TO RS TE T U SH

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THE LIST

www.wbj.pl

MARCH 25 – APRIL 1, 2013

Corporate Services

Security Companies

Rank

Ranked by revenue from security services in 2010

Company name Address Tel./Fax E-mail Web page

Grupa Solid ul. Post´pu 17, 02-676 Warsaw

Services Access Property control security / On-site Revenue system Avarage Bodyguards / installation / from Total / protection employAlarm Cleaning / security revenue ment per Remote system services (z∏. mln) / Intervention year installation / monitoring units / (z∏. mln) CCTV Detective monitoring / Training services Convoys 1st half of 2011 / 2010 / 2009 / 2008

www.bookoflists.pl

Type of property protected

Selected clients

Number of security employees / Number of full-time employees / Year founded in Poland

Top local executive / Title

PZU; InterRisk Vienna Insurance Group

Millenium Bank; BZ WBK; PKO BP; Coca Cola HBC Polska; Carrefour Polska; Castorama Polska; Statoil Poland; KGHM Polska Miedê

19,935 14,341 1994

Arkadiusz Reszke

16,117 WND 1994

Adam Paw∏owicz

Other

Private houses / Offices / Industrial buildings

Shopping malls / Banks / Public buildings

Cooperation with insurance companies

WND 882.3 876.6 842.5

WND 1,001.0 941.1 892.5

WND 26,545 22,350 18,500

✓ ✓ ✓ -

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

-

✓ ✓ ✓

✓ ✓ ✓

Konsalnet Holding SA ul. Przasnyska 6A, 01-756 Warsaw 2 22 560-5000/22 560-5004 centrala@konsalnet.pl www.konsalnet.pl

WND 484.9 483.0 250.0

WND 516.8 506.0 300.0

WND 15,500 13,500 8,200

✓ ✓ ✓ -

✓ ✓ ✓ ✓

✓ ✓ -

Cash processing; security audits; armed escorts; VIP protection; mass events security; convoy of dangerous objects, works of art, valuables, noble metals; loss verification in economic relations; GPS monitoring

✓ ✓ ✓

✓ ✓ ✓

-

Tesco Polska; Jeronimo Martins Dystrybucja; Bank Polska Kasa Opieki; Polska Telefonia Cyfrowa; ArcelorMittal Poland

Impel Security Polska Sp. z o.o. ul. Âl´˝na 118, 53-111 Wroc∏aw 3 71 711-0300/71 711-0001 cc.ochrona@impel.pl www.impel.pl

200.4 416.1 406.4 386.0

593.8 1,110.7 1,033.3 1,002.1

WND WND WND WND

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

Large events security; VIP security; safety audits; reception service; GPS monitoring; video surveillance; cash processing; ATM service

✓ ✓ ✓

✓ ✓ ✓

Ergo Hestia

Kredyt Bank; Tele-Fonika Kable; KGHM Polska Miedê; Strabag; Vattenfall Heat Poland

WND WND 1990

Adrian Downarowicz

Securitas Group(1) ul. Cybernetyki 21, 02-677 Warsaw 4 22 457-0700/22 457-0701 securitas@securitas.pl www.securitas.pl

WND 202.0 190.0 184.0

WND 202.0 190.0 184.0

WND 4,900 4,550 5,000

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

Security audits; personal security; reception; security management

✓ ✓ ✓

✓ ✓ ✓

XL Insurance (member of XL Capital)

Schenker Logistics; Grupa Lotos; Avon; PG; Electrolux; Citibank; HSBC; Ernst & Young; Polbank EFG; General Motors; BAT; MAN; Euro-Net

WND WND 1996

Krzysztof Toczyƒski; Dariusz Bàk; Miros∏aw Purzeczko; Marek Kamiƒski

Grupa EKOTRADE ul. Melomanów 4, 00-712 Warsaw 5 22 548-9000/22 548-9050 biuro@ekotrade.com.pl www.ekotrade.com.pl

149.2 144.3 142.0 123.4

154.3 150.7 144.6 126.6

7,360 6,375 5,200 4,100

WND WND WND WND

WND WND WND WND

WND WND WND WND

Fire monitoring; large events security; reception services

✓ ✓ ✓

✓ ✓ ✓

XL Insurance Company Limited; Aviva

Getin Noble Bank; Euro Bank; Bank Polskiej Spó∏dzielczoÊci; Multikino; Nestle Polska

6,850 WND 1991

Jacek Jerschina

City Security SA ul. Wybrze˝e Gdyƒskie 2, 01-531 Warsaw 6 22 628-6070/ 22 635-5116 biuro@citysecurity.pl www.citysecurity.pl

47.0 79.5 67.0 57.5

50.0 84.0 68.0 59.0

4,450 4,250 3,500 3,100

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

Anti-terrorist trainings; debt collection

✓ ✓ ✓

✓ ✓ ✓

Concordia

MAN; Accor; Z∏ote Tarasy; NATO Military Airport in Malbork; Praktiker

4,500 1,500 2001

Beniamin Krasicki

Grupa HUNTERS Sp. z o.o. ul. Bukowska 111, 62-065 Grodzisk Wielkopolski 7 61 442-1600/61 442-1613 biuro@hunters.pl www.hunters.pl

17.1 32.8 32.9 26.7

22.4 44.8 43.8 37.8

1,031 1,155 1,514 1,301

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

Inkaso; events protection; GPS car monitoring; DNA system marking

✓ ✓ ✓

✓ ✓ ✓

Allianz; PZU; Hestia; Benefia

Imperial Tobacco Polska; Auchan Polska; Piotr i Pawe∏; Douglas Polska; Nivea Polska

WND WND 1990

Piotr ˚y∏kowski

Agencja Ochrony Osób i Mienia Guard-Service Sp. z o.o. ul. Tatrzaƒska 6A, 60-413 Poznaƒ 8 61 847-7196/61 847-7196 guardservice@guardservice.pl www.guardservice.pl

15.0 19.0 19.0 16.5

16.0 20.0 20.0 17.0

520 500 500 480

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

✓ ✓ ✓ ✓

-

✓ ✓ ✓

✓ ✓ ✓

PZU

Volkswagen Polska; Raben Polska; LEK; PKP; Kuehne + Nagel

520 520 2000

Konrad Sz∏apka

Gustaw Securitas System Sp. z o.o. ul. ¸yskowskiego 18, 71-641 Szczecin 9 91 812-1478/91 434-7527 biuro@gustaw-securitas.pl www.gustaw-securitas.pl

8.2 17.4 16.4 14.5

8.3 17.5 17.2 14.5

630 567 580 568

✓ ✓ ✓ -

✓ ✓ ✓ ✓

✓ ✓ ✓

-

✓ ✓ ✓

✓ ✓ ✓

TUiR Partner

The National Museum in Warsaw; District Public Prosecutor’s Office; Regional Administrative Court; Netto; Enea Operator; ING Bank Âlàski; Carlsberg Polska; military units

630 83 1988

Gustaw Wiliƒski

1 22 668-6006/22 668-6006 ext. 106

solid@solidsecurity.pl www.solidsecurity.pl

Notes: Notes: WND = Would Not Disclose. Research for The List was conducted in November 2011. Number of employees is as of October 2011. All information pertains to the companies’ activities in Poland. Companies not responding to our survey are not listed.

Footnotes: : (1) Securitas Group: Securitas Polska Sp. z o.o., Securitas Alert Services Polska Sp. z o.o., Purzeczko - Grupa Securitas Sp. z o.o., Nordserwis Securitas Sp. z o.o.

President

President

President

Presidents

President

Board Member

President

President

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.

FINANCE & ECONOMICS

MARCH 25 – APRIL 1, 2013

Production

Industrial output declines as Poland’s economy slows The sector will likely see recovery in April Polish industrial production declined by 2.1 percent in February compared to the same period last year, after growing 0.3 percent in January, the Central Statistical Office (GUS) reported last week. Output dropped 2.8 percent from the previous month.

Construction and assembly output plunged by more than 10 percent, confirming the continuation of problems in the sector. Producer prices fell by 0.4 percent on an annual basis.

“The industrial sector is still not out of the woods,” Janusz Dancewicz, chief economist at DZ Bank Polska in

Warsaw, was quoted by Bloomberg as saying. He added that the below-forecast reading would “increase chances for another [interest] rate cut.” Poland’s monetary policy setters have slashed rates by 1.5 percent since November last year.

Other economists, however, offered a more optimistic view. “In general, the data do not change much as regards economic outlook and should be neutral for monetary policy prospects and for the market,” BZ WBK economists wrote in a statement.

“All in all, output figures for February confirm the ongoing economic slowdown in Poland, but at the same time suggest that the worst is over

and with a tailwind provided by a rebound in Germany, [Poland’s] economy is likely to see a shy recovery within a few months,” wrote Piotr Bujak, Nordea Bank’s chief economist in Poland.

According to analysts at Poland’s economy ministry, industrial production in March will further decrease by some 2.5 percent year-on-year after the February decline, but it should rebound in April.

“We estimate that production in annual terms should rebound in April 2013.

Between January and March 2013 both the industrial and construction sectors will post declines compared to the first quarter of 2012,” the analysts AS added.

Production ups and downs Poland’s industrial output growth rate (%), February 2011-February 2013 12 8 4 0 -4 -8

Feb . ’1 Ma 1 r. ’ 1 Ap 1 r. ’ 1 Ma 1 y ’1 Jun 1 . ’1 Jul 1 . ’1 Au 1 g. ’1 Se 1 p. ’11 Oc t. ’ 1 No 1 v. ’ 1 De 1 c. ’11 Jan . ’1 Feb 2 . ’1 Ma 2 r. ’ 1 Ap 2 r. ’ 1 Ma 2 y ’1 Jun 2 . ’1 Jul 2 . ’1 Au 2 g. ’1 Se 2 p. ’1 Oc 2 t. ’ 1 No 2 v. ’ 12 De c. ’1 Jan 2 . ’1 Feb 3 . ’1 3

-12

Source: Central Statistical Office

Poland’s core inflation at 1.1% in February Poland’s core inflation rate, excluding prices of food and energy, measured 1.1 percent year-on-year in February 2013 compared to 1.4 percent yearon-year in January, the National Bank of Poland announced last Monday. Core inflation stood at -0.1 percent month-on-month.

Excluding fixed prices, inflation amounted to 1.0 percent year-on-year, down from 1.5 percent in January. Excluding the most volatile prices,

inflation measured 1.7 percent year-on-year in February, against 1.9 percent in January.

According to the Central Statistical Office, February’s CPI index measuring consumer inflation amounted to 1.3 percent year-on-year, down from 1.7 percent yearon-year in January.

“The surprisingly deep inflation drop was mostly due to a stronger-than-expected decrease in food prices (it does not have much to do with

underlying inflationary pressures and is not reflected in core inflation) and a plunge in telecommunication prices.

Changes in prices of other goods and services were broadly in line with expectations,” said Nordea Bank analysts.

“We still expect that inflation in Poland will be driven down further in the next months by weakness of domestic demand and effects of some one-off changes in prices,” AS they added.

Wages rise sharply in February Wages in Poland’s private sector rose more than expected in February. The average gross salary was z∏.3,709.99, up by 4 percent year-on-year and by 0.8 percent month-on-month, statistics office GUS reported. Analysts surveyed by press agency PAP had expected the average

salary to rise by 2.6 percent y/y and fall by 0.4 percent m/m.

GUS also said that employment in the private sector amounted to 5,497,400 in February, down by 0.8 percent y/y and by 0.2 percent m/m.

“The rebound of wages after their visible deceleration

in January was due to the base effect from the past year,” Bank Zachodni WBK economists wrote in a comment.

“Thus, the volatility of the annual pace of wages in the first two months of 2013 does not really show the underlying AS trend in wages.”

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Soft lofts are gaining in popularity among Poland’s affluent apartment-buyers

2012 was a record year for Poland’s warehouse market 16

17

LOKALE IMMOBILIA

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

Oaktree new shareholder of Griffin Griffin Group, a manager of funds active in the CEE market, has a new partner and shareholder: Oaktree Capital Management. Oaktree, a global private equity fund currently managing $80 billion in various asset classes, will indirectly take over Chelsfield’s stake in Griffin through its European Principal Group subsidiary.

HB Reavis in new Polish HQ Slovakian developer HB Reavis has moved into its new office building – Konstruktorska Business Center – at the intersection of ul.

Konstruktorska and ul.

Suwak in S∏u˝ewiec Przemys∏owy, a neighborhood in the capital’s Mokotów district. The building comprises seven storeys and 48,000 sqm and is the company’s first office project in Poland. ●

In this issue Warsaw Mayor interview .14, 15 Miasteczko Kasprzaka . . . . . . .14 Soft lofts . . . . . . . . . . . . . . . . . . .16 Łódź office market . . . . . . . . . .16 Warehouse market . . . . . . . . . .17

Warsaw’s mayor: subway crucial for city Lokale Immobilia sits down with Mayor of Warsaw Hanna Gronkiewicz-Waltz to talk about the city’s second subway line, its investment market and her political future Karolina Kowalska: At MIPIM Warsaw presented 16 plots in the very center of the city. The one that got the most attention was at Plac Defilad, in front of Palace of Culture and Science. Can you tell us something about it?

Hanna Gronkiewicz-Waltz: We offered one plot on Plac Defilad that wholly belongs to the city. All the other pieces of land we own there, except for the plot belonging to Museum of Modern Art, are patches, too small to be developed. Our 5,837-sqm plot in front of the Palace of Culture and Science is destined for cultural and service areas, as well as a discreet office building whose height should not exceed several floors, since the high-rise

skyscrapers are located on the other side of the square, on ul.

Emilii Plater.

Is there a chance for Plac Defilad to be homogenous, all developed in line with city and city’s architect’s requirements?

I once said that if someone stood on top of the Palace of Culture and threw down confetti, there would be as many claims for the plots as pieces of confetti. Plac Defilad took the place of many small parcels in the capital’s very center, where numerous tenement houses once stood. There are so many claims for them that it doesn’t seem probable that the area could ever be homogenous Continued on p. 15 ➡

Warsaw Mayor Hanna Gronkiewicz-Waltz

Residential

JWC to launch huge residential development Miasteczko Kasprzaka will become a “minicity” in Warsaw’s Wola district J.W. Construction (JWC) has announced that it will soon start development of its Miasteczko Kasprzaka “minicity” residential estate in Warsaw’s Wola district. It will be the biggest estate the developer has ever built.

The scheme will be developed on a 81,185-sqm plot at the intersection of ul. Kasprzaka and Al. Prymasa Tysiàclecia. The company bought the land last year for z∏.155 million from VIS, the owner of a former weapons factory on the site. The project is to be devel-

oped in five phases and will deliver a total of 3,000 apartments and 70,000 sqm of usable space, a part of which will be taken up by a shopping center. The company predicts that some 10,000 people will eventually live in the development.

The first phase of construction, set to deliver 156 apartments, will be launched later in the first half of this year.

The developer could also launch the second phase of the investment, delivering 965 apartments, before the end of the year. The first two phases of construction will cost the company some z∏.250 million.

Ma∏gorzata Szwarc-Sroka, economic section director at

J.W. Construction, called the project the company’s “flagship development.”

Like the other large residential developments built in Warsaw in recent years, Miasteczko Kasprzaka is located in a previously neglected area. The investment will bring modern urban tissue to the neighborhood.

J.W. Construction attempted to buy the plot back in 2011 and had initially entered into a preliminary contract to purchase it for nearly z∏.174 million. However, the local spatial development plan wasn’t introduced as expected and the transaction had to be called off.

Karolina Kowalska

COURTESY OF J.W. CONSTRUCTION

Developer Okam Capital will launch construction on the second phase of its InCity multifamily residential estate on ul. Siedmiogrodzka in Warsaw’s Wola district. It will deliver an additional 97 apartments in the third quarter of 2014 with Unibep as the general contractor.

Interview

COURTESY OF WARSAW CITY HALL

Okam launches second phase of InCity

MARCH 25 - APRIL 1, 2013, 2 LI 18/11

Miasteczko Kasprzaka will house 3,000 apartments

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

LOKALE IMMOBILIA – REAL ESTATE

MARCH 25 - APRIL 1, 2013

➡ Continued from p. 14

Those who call for the takeover of Plac Defilad often bring up the example of Wroc∏aw or Gdaƒsk. How are these cities different?

In Warsaw these lands are not the property of the state or a former property of the Germans that could have been “denazified.” In Warsaw we are dealing with a private property of the people who have or might have successors.

There are new claims appearing every couple of weeks.

When I became president of Warsaw, the plot that now belongs to the Museum of Modern Art had one claim.

Then they multiplied.

But the right of property is a principal right and it can by no means be violated. Today’s problems are a consequence of the fact that we didn’t have re-privatization. We are going to be paying for it for many years.

Despite the problems with Plac Defilad, investments are expanding out from the center of Warsaw, west to Wola and north to ˚oliborz. What’s the reason for the success?

Warsaw is developing fast. ...

The investors I spoke with in Cannes said they appreciated the atmosphere we created for investments. We do our best to make their lives easier and the procedures less bureaucratic.

The time an investor waits for a building permit has been shortened significantly since I became president.

Now everyone with a clear property record can get a permit relatively quickly. The pace of investment and development of the city depends on the funds coming to Warsaw and these are quite big, judging from the supply of office space, for example.

Office supply in the city is so large that it could soon outgrow demand, but investors don’t seem too concerned.

Why do you think that is?

The developers I talked to claim that we are still on the safe side, as the vacancy rate in Warsaw has reached 9 percent and the safe margin is 11 percent. When that level is exceeded, prices will stop growing.

COURTESY OF KPRM

but, hopefully, that will change in the near future.

I hope that our sale of the plot will mark the beginning of this change. I am really disappointed at what some journalists are saying, that the city should take it over and build on it as it sees fit. Every democratic state that respects private property would never dismantle someone’s property. I want to underline that, according to the Article 21 of the Polish Constitution, the Republic of Poland shall protect property ownership and the right of succession.

Mayor Gronkiewicz-Waltz with Prime Minister Donald Tusk You say that investors are touting the city’s friendliness but others are less approving, as the recent controversy over the Meble Emilia property shows. What is your view?

Frankly speaking, I really can’t understand their grievances. The head of Griffin Group, Przemys∏aw Krych, the new owner of Meble Emilia and its pavilion, have even sued me and the director of the Museum of Modern Art. They pressed charges in both criminal and civil court. I am the first mayor of Warsaw to be sued in criminal court for damage of reputation, and there seems not to be a reason for that.

Griffin Group representatives say that the city is trying to obstruct them in managing and developing their property by, among other things, registering it as historic buildings. Is that the case?

We are not trying to obstruct them in anything but if the Griffin representatives want to think this way, I have no power to prevent them from it. They seem to be the only investors unhappy with my administration. The ones I met at MIPIM – the Slovaks, the Dutch – assured me that the city made the procedures investment-friendly, that the city doesn’t tell them what to do but rather suggests.

Of course, we have the city plans and the [zoning] designation of the plots cannot be changed on demand, but we make sure everything goes smoothly and intervene when it is possible. For example, we negotiate with the Civil Aviation Authority on the height of the future skyscrapers if the investor wants them to be higher.

Recently EU leaders agreed on a new 2014-20 budget.

Poland could get as much as

z∏.441 billion. How much of this could be given to Warsaw and what would you like to use this money for?

We don’t know how this money will be divvied up yet but for sure we plan to concentrate on financing the second line of Warsaw’s subway system. This is a key investment for us because a big, capital city of a European country cannot function properly without a subway network.

“Looking at the EU budget, I start developing a hunger for a third run.”

We would also like to invest in innovative technologies, as Warsaw Technical University is planning a modern research center on ul.

Poleczki in Ursynów. It could be Warsaw’s version of Silicon Valley, the center for expansion of innovative businesses.

Are you considering running for reelection?

I haven’t thought it through yet, but looking at the EU budget, I start developing a hunger for a third run as there is still so much to do. I would like to finish the second subway line and the ÂródmieÊcie bypass.

And I really think I am the right person for hard times.

The timing of my term was the worst anyone could have choosen over the last 22 years.

Only the first year – 2007 – was relatively calm, but in the autumn I told Warsaw’s district leaders they had to cut their budgets by z∏.3 billion in total. They said it was the first time in history and wanted to know why. I told them I was expecting a crisis. And there it was, a year later. I learned to anticipate crises while work-

ing for the European Bank for Reconstruction and Development.

Have you ever considered becoming prime minister?

I could not become prime minister because I am a “doer” rather than a leader of a political party. And the role of prime minister is more the role of a leader. Besides, I am really satisfied with the job of the Mayor of Warsaw. There couldn’t be anything more interesting and challenging than that and I love the challenge.

As a “doer” you seem to have a thick skin. At the beginning of your time in office, Varsovians complained about construction at every corner.

Now they have begun to appreciate the improvements and the prospects for the second subway line. Did you know they would eventually come around?

I knew that the construction of the second subway line was the key investment for Warsaw. We had to give Bemowo and Wola from one side, and Bródno and Targówek from the other, a fast way to commute to the center. I also think that, despite the criticism, we managed to start the investment and proceed with it really quickly.

In May we will celebrate the third anniversary of the beginning of construction [of the second subway line] and we are already advanced in our work. The construction of the subway in Warsaw was nearly impossible even for the communist government, and we all know there was nothing impossible for them. They didn’t manage to finish the first subway line and didn’t even try to start the second one.

I think the construction of the second subway line is the greatest success of my mayorship. ●

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LOKALE IMMOBILIA – REAL ESTATE

MARCH 25 - APRIL 1, 2013

Residential

Affluent buyers are searching for fashionable, highstandard lofts High ceilings, brick walls, large windows and uncovered piping – loft design is en vogue in Poland in many postindustrial schemes. As young people increasingly look to hard lofts – apartments in original post-industrial buildings – older, more affluent buyers prefer those that combine loft design with modern trappings.

Soft lofts are designed to look post-industrial, but are built using high-quality materials and traditional construction methods, such as bricklaying.

Koneser, located in the capital’s Praga Pó∏noc district on the site of a former vodka distillery, will deliver 12 hard lofts and 330 housing units, the majority of which will be soft lofts, priced from z∏.7,900 per sqm. The whole investment is scheduled to be completed in 2015 and is valued at

more than z∏.400 million. BBI Development is the investor behind the scheme.

More soft lofts will be available in Nowa Papiernia, being developed by REDReal Estate Development in Wroc∏aw’s Krzyki district. A total of 129 units, sized from 35 sqm to 100 sqm and priced between z∏.7,475 and z∏.8,625 per sqm, are scheduled to be completed in Q1 of 2014.

“The first phase of the project will comprise adaptations of two buildings from a

[19th-century] paper mill into soft lofts and construction of a new residential building,” said Monika Piechota, marketing director at RED Modern lofts are also available in the Softlofts by Potok residential estate in Józefos∏aw, near Warsaw. The development consists of eight buildings with 40 housing units, ranging from 102 to 176 sqm and priced at z∏.4,400 per sqm.

The developer, Ascomp International, says it is plan-

COURTESY OF BBI DEVELOPMENT

Soft lofts increasingly popular

The Koneser development will offer soft lofts priced from z∏.7,900 per sqm ning several innovations, going beyond the current technological market standard and wants future loft owners

to be “surrounded by modern technology.”

Marta Mardosz, Karolina Kowalska

¸ódê office market expanding Leasing activity in ¸ódê’s office market is set to remain stable this year, after totaling 27,700 sqm in 2012, advisory Jones Lang LaSalle writes in its latest report on the subject. But with a large amount of space under construction, rents could see some downward pressure. ¸ódê’s modern office stock currently stands at some 250,000 sqm, with 45,100 sqm currently under construction scheduled to be completed this year. The vacancy rate, now at 13.7 percent, could rise due to the relatively significant construction activity and the moderate level of demand, the report said.

If all of the office projects planned for ¸ódê in 2013 are delivered, the relatively low prime rents of €1113/sqm/month may fall.

However, that will mostly affect buildings that currently offer a considerable amount of vacant office space.

When it comes to large tenant requirements, ¸ódê offers five office lease options for a minimum of 1,000 sqm in existing buildings and three in projects due by the end of 2013. ¸ódê’s office market development is driven mostly by “business services sector companies, which occupy approximately 80,000 sqm amounting to 40 percent of the total office space supply in the city,” said Jakub Sylwestrowicz, associate director in the tenant representation department at Jones Lang LaSalle.

“2012 was a breakthrough year, with such leading market players as HP and Samsung announcing the opening of their centers in the city,” Mr Sylwestrowicz said.

KK

MARCH 25 - APRIL 1, 2013

LOKALE IMMOBILIA – REAL ESTATE

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17

Logistics

Poland remains the biggest warehouse market in CEE despite the crisis, according to a new report The economic downturn has affected Poland’s warehouse market, Jones Lang LaSalle finds in its latest report on the sector. Still, development in Poland’s regions marks a maturing of the market in general.

In 2012 demand for industrial warehouse space in Poland fell 18 percent to 1.35 million sqm, while new deals and space extensions fell by 24 percent to 755,000 sqm.

Renewals accounted for 44 percent of the total take-up, 4 percent more than in 2011.

The highest level of renewals was registered in the region of Central Poland and the suburbs of Warsaw.

The report noted that the current economic downturn has not affected only take-up volume, but also its sectoral structure. The share of logistics operators in the total net demand increased during 2012 to 43 percent, or 320,000 sqm.

This trend is often observed when economic turmoil hits,

the report’s authors explained, as it is driven by companies which increasingly outsource their logistics and distribution activities to optimize their cost structures.

Other main drivers for logistics space included the food sector (105,000 sqm of net take-up) and the automotive sector (99,000 sqm).

The largest deals in 2012 included the renewal of Leroy Merlin’s lease of 56,000 sqm in Panattoni Park Stryków and a new lease deal in which DHL took up 33,800 sqm in Prologis Park Dàbrowa. Among the locations that were the most sought-after were Warsaw, with 229,000-sqm net take-up, Wroc∏aw with 153,000-sqm take-up and Upper Silesia, with 141,000 sqm take-up.

Vacancy rates down Despite the falling take-up, the overall vacancy rates decreased further in 2012 to 10.1 percent, compared with 11.5 percent in 2011. There was 713,000 sqm of immediately vacant space at the end of 2012. JLL said the decrease in vacancy rates was the result of a more cautious approach from developers, who have reduced speculative projects

to a minimum.

The total completion level – mainly accounted for by nonspeculative projects – was 40 percent up in 2012, reaching 518,000 sqm. Thanks to that, total Polish warehouse stock exceeded the 7 million sqm threshold, reaching 7.1 million sqm in Q4 2012. As a result, Poland remains the largest industrial market in Central and Eastern Europe.

Rents throughout Poland remained stable during 2012, despite considerable differences among regions or even locations in the same region, depending on the level of vacancy or the number of competitive schemes. Facilities next to motorways are sought-after by tenants and rental levels asked in such locations may be – according to the report – subject to upward pressure.

In locations with high vacancy rates (Warsaw and Central Poland) tenants can expect developers to be more flexible during negotiations.

On the other hand, in regions where available space is lacking (Poznaƒ, Upper Silesia and Kraków) developers might be rather reluctant to make concessions.

COURTESY OF PANATTONI

Polish industrial market more mature

Leroy Merlin’s lease of 56,000 sqm in Panattoni Park Stryków was the largest such deal in Poland’s warehouse sector last year Rents differ depending on the type of the facility offered.

Those located in business parks, which combine warehouses and office space, so called “small business units” (SBU), mainly located in inner-city areas, are more expensive due to the smaller sizes of the floor spaces on offer (mostly up to 1,000 sqm) and higher prices for land in those locations.

The SBU rents range from €3.60 to €5.30 per sqm per month in inner-city Warsaw and from €3.50 to €3.80 per sqm per month in ¸ódê and Wroc∏aw. Lower rents are offered in large distribution facilities located in the suburbs of big cities. In the Warsaw suburban area effective rents ranged from €2.20 to €2.80 per sqm per month.

Despite the mixed picture

on take-up and rents, investment in industrial real estate registered a record volume in 2012 of €468 million. This was mainly driven by three large portfolio deals. With increased interest from investors in the Polish market, investment yields for prime industrial assets are stable and set at 8.00 percent, or below in the case of extraordinary deals.

Karolina Kowalska

18

MARCH 25 – APRIL 1, 2013

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Advertorial feature

Land like gold Financial advisors tempt us with complicated products, equities, and funds.

Meanwhile, land provides bigger profits Real estate has always been considered a stable and longterm investment. When we talk about real estate we usually mean buildings and apartments. But that’s a simplification.

Of course, such properties can also be profitable, but in recent years the apartment market has been impacted by price fluctuations. Today we face a significant slowdown, after the boom on the housing market a few years ago.

Prices have stopped rising (and are not decreasing as fast as buyers might expect), while those who bought apartments during the boom now have problems profiting from their investments.

Moreover, in the coming years we predict that these prices will remain stable due to the relatively small amounts of money that Poles can spend on real estate. Foreign investors are not going to push up prices either. Apartments in Warsaw are not much cheaper than in richer European cities, and the limited access to mortgage loans only worsens the sector’s prospects.

The situation is different when it comes to agricultural land. During the past decade the value of some farmland has risen by as much as 331 percent. Each year the value can rise by as much as 20-30 percent. This is a rate of return that many financial institutions can only dream of. Such a return cannot be guaranteed by any bank deposit or, apart from exceptional cases, investments in the stock market.

Where does the boom come from?

The biggest influence on the development of agricultural land was Poland’s accession to the European Union. It had a twofold effect. Firstly, the number of potential clients rose, leading to higher demand. Although the restrictions on foreigners buying land still continue to apply, in 2016 they will disappear, which may cause an increase in demand and probably result in a faster growth of prices. This will be possible because agricultural land in Poland is still cheaper than in Western Europe.

Secondly, the system of EU direct subsidies increased the value of land. People who bought agricultural land around the time of Poland’s accession have gained the most.

Those who sell the land today can make a return on investment of a few hundred percent.

When buying agricultural land, we can expect it to double in value within a few years. Once the land is zoned for nonagricultural activity, its value will rise. Agricultural land will continue to remain cheaper than land for construction purposes, so rezoning agricultural land means an additional and substantial (especially with regard to the peripheries of large urban agglomerations) premium.

Agricultural land is better?

This why agricultural land is a better investment than land for construction purposes. The value of the latter will indeed grow, but their prices have already been inflated after the recent boom in the housing market, and it will be difficult to count on particularly dynamic growth. It’s not insignificant that when it comes to such investments, you will have to put more money in.

Growing demand and limited supply works in favor of agricultural land. If a purchase of land is treated as an investment, those who have more money can count on really big profits. Indeed, a large agricultural plot can later be divided into smaller plots and sold at a profit (single plots will be much more expensive). This is an expense of a few hundred thousand to even more than a million z∏oty. However, those less well-off can also become landowners. There are special programs available that allow an investor to sign an ownership deed after paying only part of the price (the rest is paid in installments).

Agricultural land also offers the possibility to provide oneself with a location for residence at a reasonable price, compared with real estate in urban areas. Agricultural plots often allow the possibility of development, so it might be a place to build a permanent or vacation home.

Opportunities and dangers With all the strengths of agricultural land, it is worth noting that as with any other investment decision, it should not be

Krzysztof Sadecki CEO of New Direct Holding Agricultural land has been a great investment in recent years, providing an average 20-percent profit – more than any bank deposit. And it is not an investment available only for wealthy. There are programs that allow an investor to become a landowner for a relatively small amount of money and pay the rest in installments (spread out over 10-15 years).

When purchasing land it is important to take several factors into account. Firstly, the location – prices of land on the outskirts of large cities has increased in recent years. Although their value in the coming years will likely continue to grow, it will not be a growth as rapid as in other areas of the country. Furthermore, such a purchase will require a lot more money.

The second important factor is the grade of the land. Grade 1-3 agricultural land is unlikely to be rezoned as land for construction purposes. It is better to focus on grades 4-6 land, because in addition to the previously mentioned increase in price, the value of the land will increase abruptly after it is rezoned as land for construction purposes.

This does not mean that land that cannot be rezoned is not a good investment. On some plots it is allowed to develop buildings, and such a plot in an attractive location can be a great start towards starting one’s own business – in the agritourism sector, for example.

Not everyone is an expert in the sale and purchase of land, so it is important to ask a real estate appraiser to assess the value of the land, check the ownership issues and find out whether the seller has the right to dispose of it, as well as if the land is encumbered by debt. ● made hastily. After all, it requires investing a considerable amount of money. There is no 100 percent certain investment, so before buying a plot it is worth talking over the purchase with a real estate appraiser and advisor who can assess the real value of the land. Even the most beautifully situated plot can have its drawbacks, which then will prevent its resale or will force us to incur further costs.

Price is affected by various factors: location, distance from transportation routes, utilities, and neighborhood. A layman enchanted by the place may not take those factors into account. ●

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AIM Poland Office

•

phone: +48 500 075 046 • email: barbara.owerczuk@aimcongress.com

20

MARKETS

www.wbj.pl

MARCH 25 – APRIL 1, 2013

Stocks report

world stock indices DJIA

NASDAQ

14,421.49 (Mar 21 close)

S&P500

3,222.60 (Mar 21 close)

-0.81% (for the week)

FTSE100

1,545.80 (Mar 21 close)

-1.11% (for the week)

DAX

6,388.50 (Mar 21 close)

-1.11% (for the week)

-2.16% (for the week)

Cyprus rattles markets

NIKKEI 7,932.51 (Mar 21 close)

12,635.69 (Mar 21 close)

-1.56% (for the week)

2.06% (for the week)

CHANGE: 7.52% (year to Mar 21)

CHANGE: 3.55% (year to Mar 21)

CHANGE: 5.70% (year to Mar 21)

CHANGE: 5.99% (year to Mar 21)

CHANGE: 1.98% (year to Mar 21)

CHANGE: 18.22% (year to Mar 21)

52-week high: 14,546.82

52-week high: 3,260.13

52-week high: 1,563.62

52-week high: 6,534.00

52-week high: 8,074.47

52-week high: 12,650.26

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 European equity markets were hit hard last week, with fears of a potential banking collapse in Cyprus consuming investors’ attention.

On Monday a proposal to partially fund a bailout of the island nation by taxing bank deposits spooked European investors. Financial shares suffered throughout the continent. The blue-chip WIG20 index lost 1.3 percent, with only the mid-cap mWIG40 closing higher amongst the wider indices.

Shares continued their slide on Tuesday, as investors continued to fret about Cyprus. Once again blue chips were hit hard, with shares of banks Pekao and PKO BP losing about 1.25 percent. The WIG20 was hit harder than most European indices, losing 1.3 percent.

The main WIG index lost

Major indices WIG

45,580.47 (March 21 close)

WIG20

2,395.82 (March 21 close)

Change for the week: -3.48%

52-week high: 48,222.72

Change for the week: -4.12%

52-week high: 2,628.36

Change year to March 21: -5.25%

52-week low: 36,653.28

Change year to March 21: -8.77%

52-week low: 2,035.80

48,000

6,600

47,400

6,540

46,800

6,480

46,200

6,420

21.03

20.03

19.03

18.03

15.03

14.03

13.03

12.03

11.03

08.03

07.03

06.03

05.03

04.03

01.03

28.02

27.02

26.02

25.02

21.03

20.03

19.03

18.03

15.03

14.03

13.03

12.03

11.03

08.03

07.03

06.03

05.03

04.03

01.03

28.02

27.02

26.02

25.02

45,000 22.02

6,300

22.02

45,600

6,360

Top 5 ELKOP BOMI EXILLON MEDIATEL PATENTUS

Closing 0.17 0.05 7.94 1.06 2.05

% change (week) 52-week high 30.77 0.32 25.00 2.15 24.06 9.61 17.78 2.56 14.53 2.25

52-week low 0.12 0.04 4.52 0.86 1.13

Top 5 BRE TPSA JSW PZU BORYSZEW

Closing 348.00 6.80 94.25 408.50 0.48

% change (week) 0.72 -0.87 -1.62 -1.92 -2.04

52-week high 356.90 17.34 101.00 442.00 0.81

52-week low 255.70 6.58 81.86 272.07 0.42

Bottom 5 HBPOLSKA REDAN NOVAKBM BYTOM IDEON CEDC

Closing 0.01 1.02 3.25 0.34 0.05 1.09

% change (week) -50.00 -36.25 -35.26 -29.17 -28.57 -27.33

52-week low 0.01 0.77 3.24 0.25 0.05 0.93

Bottom 5 KERNEL KGHM GTC ASSECOPOL HANDLOWY

Closing 54.50 159.00 8.06 42.00 92.50

% change (week) -11.81 -8.36 -8.20 -6.67 -6.00

52-week high 76.00 194.80 10.25 50.90 102.10

52-week low 51.00 92.14 5.13 38.80 64.20

52-week high 1.03 2.96 14.70 0.74 0.20 17.25

Currency report

Focus on Cyprus

Other indices sWIG80

11,069.03 (March 21 close)

WIG-Banki

6,357.84 (March 21 close)

21.03

20.03

19.03

18.03

15.03

14.03

13.03

12.03

11.03

08.03

07.03

06.03

05.03

21.03

20.03

19.03

18.03

15.03

14.03

13.03

12.03

11.03

08.03

45,000

07.03

45,000

06.03

45,600

05.03

45,600

04.03

46,200

01.03

46,200

28.02

46,800

27.02

46,800

26.02

47,400

25.02

47,400

22.02

48,000

04.03

52-week low: 5,163.30

01.03

Change year to March 21: -5.43%

28.02

52-week low: 32.13

27.02

52-week high: 6,723.16

Change year to March 21: -1.84%

26.02

Change for the week: -2.92%

25.02

52-week high: 43.11

22.02

Change for the week: -0.09%

48,000

Adam Narczewski X-Trade Brokers DM SA

21.03

20.03

19.03

18.03

15.03

14.03

13.03

12.03

11.03

08.03

52-week low: 8,984.43

07.03

04.03

01.03

21.03

20.03

19.03

18.03

15.03

32.61 (March 21 close)

52-week high: 11,245.80

SOURCE: WSE

NewConnect

14.03

13.03

12.03

11.03

45,000

08.03

45,000

07.03

45,600

06.03

45,600

05.03

46,200

04.03

46,200

01.03

46,800

28.02

46,800

27.02

47,400

26.02

47,400

25.02

48,000

22.02

48,000

28.02

Change year to March 21: 5.11%

27.02

52-week low: 2,147.52

26.02

Change year to March 21: 2.61%

25.02

Change for the week: -1.44%

22.02

52-week high: 2,718.31

06.03

2,635.54 (March 21 close)

Change for the week: -1.94%

05.03

mWIG40

1.37 percent.

Wednesday saw some relief, with European equities halting their slide on anticipation on news from across the pond that the Federal Reserve will stay firm in stimulating the US economy.

Warsaw’s main indices saw marginal increases, with both the WIG and WIG20 up less than 0.10 percent.

Equities saw early gains on Thursday, reversing direction after an hour of trading. Poor macroeconomic data from both Germany and France again spooked markets, causing further declines in an already poor week. Both the WIG and WIG20 shed slightly more than one percent.

On Friday the WIG lost 1.13 percent and the WIG20 fell 1.08 percent as worries over Cyprus persisted. ●

Nervousness has returned to the markets. Cyprus, which needs financial aid, is required to find €6 billion in order to receive a transfer from the IMF. So far, its parliament rejected the idea of taxing citizens’ deposits. The situation is very difficult as the country does not have another source from which to quickly gather funds.

The Cyprus story was the main event of the week, overshadowing the Fed’s monetary policy meeting, at which Ben Bernanke reassured markets that the US central bank will continue its quantitative easing program.

Due to these events, investors began the week with a big sell-off of the euro. The EUR/USD, which the previous week was being traded close to $1.31, collapsed to levels below $1.30 and was unable

to recover during the whole week (reaching even $1.2850 by mid-week, its lowest since November of last year).

It was a difficult week for the z∏oty too. Macroeconomic data has not helped, with CPI inflation falling to 1.3 percent in February while industrial production declined by 2.1 percent year-on-year.

Increased risk aversion caused a sell-off of emergingmarket currencies, including the z∏oty. The EUR/PLN climbed from z∏.4.15 all the way to z∏.4.18, while the USD/PLN advanced from z∏.3.17 to z∏.3.22. Holders of mortgages denominated in Swiss francs were also disappointed, as the CHF/PLN reached its 2013 high of z∏.3.43. The upcoming week will also be volatile, as investors await news from Cyprus. ●

currency rates 3.3937 21.03

3.4275

3.3753 20.03

22.03

3.3610 19.03

SOURCE: NBP

3.3712

3.3120 15.03

0.1047

0.1047 22.03

3.0

18.03

PLN-100JPY

3.5

21.03

0.1041 20.03

0.1039 19.03

18.03

0.1038 15.03

3.4240

3.4257 22.03

0.101

0.1038

PLN-RUB

0.105

21.03

3.3999 20.03

3.3860 19.03

18.03

15.03 3.3770

4.9130

4.9224 22.03

3.3

3.3969

PLN-CHF

3.5

21.03

4.8702 20.03

4.8455 19.03

18.03

4.8260 15.03

3.2387

3.2361 22.03

4.7

4.8448

PLN-GBP

5

21.03

3.2169 20.03

19.03

3.2015 18.03

3.1

15.03

22.03

3.1868

4.1860

4.1805

3.2

3.2055

PLN-USD

3.3

21.03

4.1538 20.03

4.1465 19.03

18.03

4.1595 15.03

4.1

4.1505

PLN-EUR

4.2

SPORTS

MARCH 25 – APRIL 1, 2013

www.wbj.pl

21

American Football

Kowalczyk wins World Cup

Return of the gridiron heroes

Poland’s Justyna Kowalczyk won her fourth overall crosscountry World Cup in Drammen, Norway last week. The 30-year-old, from Limanowa, in southern Poland, won the classical sprint at the 14th stage of this season’s FIS World Cup, but even before the race began it was clear that she would be the one to lift the Crystal Globe (a trophy given out to the best skiers of the season), because two of her biggest rivals, Norwegians Therese Johaug and Marit Bjoergen, had decided to withdraw from the race.

The Pole’s victory never looked in doubt as she crossed the line ahead of Norwegian skiers Heidi Weng and Ingvild Flugstad Oestberg, who were 0.90 seconds and 2.03 seconds behind her respectively.

Speaking after the event she told reporters, “It is my first victory in Drammen. I felt strong and could enjoy the race when I had secured the overall World Cup.”

With the World Cup title already locked up, her secondplace finish in the next race in Oslo – behind Ms Johaug – didn’t cost her. Ms Kowalczyk crossed the finish line of the 30km free technique race 46.6 seconds after the Norwegian.

The world cup means Ms Kowalczyk – who had arthroscopic knee surgery last year – adds yet more hardware to a growing trophy case in a distinguished 12-year career that has seen her become one of

Poland’s most decorated athletes of all time. She has won Olympic gold, silver and two bronze medals, and in the World Cup series alone has earned 60 podiums including 27 wins.

“The 30km free technique is not easy for me to do, especially this season, after my knee surgery, so to come second was great,” she said in a statement on her website following the Oslo event.

COURTESY OF FACEBOOK/KIBICUJJUSTYNA

The Polish skier won her fourth overall title

Justyna Kowalczyk is number one, again

David Ingham

The eighth season of the Topliga is upon us, and organizers promise it will be bigger and better than ever The top division of the Polish American Football League (PLFA), the Topliga, was due to kick off games this past weekend, to no little excitement after its hugely successful championship match last year, which drew some 23,000 fans to Poland’s National Stadium in Warsaw.

This year, the Topliga has been expanded to eight teams, with two divisions of four teams each. The newest additions to the Topliga are the Warsaw Spartans, Giants Wroc∏aw and Zag∏ebie Steelers Interpromex. As a result, two derby matchups will be created, in Wroc∏aw and Warsaw, which will have two teams each.

All of the teams will play 10 regular season games. The two top teams in each division will advance to the semifinals.

After the success of last year’s championship, the Superfina∏, the league plans to continue its expansion.

“According to our polls, 51

COURTESY OF PLFA/MARCIN WARPECHOWSKI

Cross-country skiing

Last year’s Superfina∏ lured 23,000 fans to Poland’s national stadium. Seahawks Gdynia (foreground, on offense) beat the Warsaw Eagles, 52-37 percent of those people [who attended the Superfina∏] were at an American football game for the first time and 88 percent of them said that they want to come back,” said PLFA president J´drzej St´szewski.

This year’s Superfina∏ is scheduled for July 14, and like last year’s it will be held at a large stadium, though the exact location has not been announced yet.

The sport does indeed look set to reach a larger audience this year. Last year’s runnersup, the Warsaw Eagles, will play their games at the city’s 5,000-seat stadium on ul. Kon-

wiktorska, which they will share with the Polonia Warszawa soccer club. Moreover, if one of the Wroc∏aw teams manages to earn one of the top two seeds for the playoffs, their semifinal game will be played at the city’s Municipal Stadium, which seats some 44,000 and was built in the run-up to last year’s European soccer championships.

But those who wish to see the games will have to attend in person, since only the playoffs and the Superfina∏ will be broadcast on television. Seahawks Gdynia are the current defending champions.

Jacek Ciesnowski

22

LIFESTYLE

www.wbj.pl

MARCH 25 – APRIL 1, 2013

Concert

Exhibition

Hired hand

Every picture tells a story

Steve Lukather Steve Lukather April 9 Klub Stodo∏a ul. Batorego 1 Warsaw American rock guitarist Steve Lukather has performed with the great and the good of the musical world during his 36year career.

He started out at the age of 19 with the band Toto, of which he was a full-time mem-

ber until 2008. At the same time he worked on his own solo career and also performed as a session or touring guitarist with other musicians.

Collaborating with the likes of Alice Cooper, Aretha Franklin, Eric Clapton, Joni Mitchell, Lionel Richie, Eddie Van Halen and the late Michael Jackson, he has played on more than 1,500 records as one of the go-to

men in rock for some great guitar work.

Nominated for a total of 12 Grammy awards, he has so far won five, three for his work with Toto. Described as an intense and melodic performer, those who attend this Warsaw gig can expect some famous covers as well as plenty of extended solos during a classic rock show.

David Ingham

The work of internationally renowned and award-winning graphic designer Lex Drewinski goes on display at Warsaw’s Museum of Caricature and Cartoon Art this spring. This new exhibition will comprise the best of his work since 1984, including his 2000 poster LexICON A-Z which was previously exhibited at the Centre Georges Pompidou in Paris, as a sample object of 21st century art.

Born in Szczecin in 1951, Mr Drewinski studied in Poznaƒ at the Academy of Fine Arts. In 1985 he emigrated to West Berlin before going on to become a professor at the University of Applied Sciences in Potsdam, Germany, where he still runs his own graphic design studio. He has had over 50 individual exhibitions across the world and is respected for his unique style of social commentary. He has tackled hard-hitting topics such as hunger, fascism, violence, racism, poverty and the Western world’s over-con-

sumption with his own brand of humor for the best part of 30 years.

Speaking about his own work Mr Drewinski says his posters are “like a good joke,

the less they’re narrated, the longer they stay in the memory. … To take something away from a poster means to add something to it. ... Less is David Ingham more.”

COURTESY OF LEX DREWINSKI

COURTESY OF WIKIMEDIA COMMONS

“Lex Is More” – Lex Drewinski Ongoing from April 15 Museum of Caricature and Cartoon Art in Warsaw ul. Kozia 11

Lex Drewinski’s ‘Highway to Hell’

LAST WORD

MARCH 25 – APRIL 1, 2013

www.wbj.pl

23

Tech Eye

Samsung’s latest Galaxy lacks star power

The Galaxy S4

Here’s the thing: when Samsung revealed the Galaxy S4, its “life companion for a richer, simpler and fuller life,” Techeye was immediately reminded of the iPhone 4S. It wasn’t the dyslexia talking either; plenty of other people had the same reaction.

Like the iPhone 4S, the Galaxy S4 is hard to distinguish from its immediate predecessor. It’s an evolutionary half-step forward, or at least it feels that way, and there’s an emphasis on software upgrades rather than new hardware. Crucially, it lacks a “wow” factor.

But let’s look at what it does have. The Galaxy S4 is incrementally larger than the SIII, with a 5-inch screen and more pixels per inch.

This is a “full HD” display, up from the SIII’s plain old “HD” display, though the average punter may not notice the difference.

Under the hood is the eight-core Exynos 5 Octa processor, which is cool in theory but not drawer-soilingly awesome in practice. The Exynos 5 Octa comprises two discrete sets of four cores, one powerful (and power hungry), and the other pedestrian (but power thrifty); only one set is ever in use at a time.

This is a clever way to deliver raw

option, which takes photos with both front and rear cameras simultaneously, and produces a composite image.

There’s also “drama shot,” which creates time-lapse photos, as well as “sound & shot,” which apparently stores audio as the picture is taken.

So a photo of, say, someone vomiting, would be forever accompanied by the “bleeeeeeeeeeeech” sound. A true miracle of modern technology.

Another software addition, this one unrelated to the camera, is “Samsung Smart Pause,” which pauses whatever you’re watching if you look away. Then there are “S Translator,” which provides instant transla-

processing power without compromising battery life, but maybe they should call it a 4x4-core processor to avoid disappointing customers looking for blazing eight-core performance.

(Note that only the international version of the phone has the Exynos 5 Octa processor. North Americans get a Snapdragon 600 processor instead, which is zippy but also “just” a quad core.)

Other hardware improvements include 2GB of RAM, a slight weight reduction and a 13MP camera. The latter is accompanied by some interesting software features, such as the “dual camera”

tion, and “S Health,” which somewhat ominously “monitors your health, surroundings and so much more.”

That’s about it for Samsung’s “life companion for a richer, simpler and fuller life the next 12-or-so months.”

The S4 goes on sale at the end of April, in white and black; price as-yet unannounced.

It’s a respectable piece of hardware, sure, but its first impression leaves something to be desired. In an ideal world the S4 would have a 3D screen or a laser can-opener or something, anything, to cause drawer soilage.

But it’s not an ideal world, is it? ●

Smarter, better, faster, stronger

*all specs at launch of international version **expandable with SD card

A comparison of top smartphones* Galaxy S4

iPhone 5

HTC One

Display size

5-in

4-in

4.7-in

4.8-in

Display type

Full HD Super AMOLED

Retina (HD)

Full HD 1080p

HD Super AMOLED

Pixels per inch (PPI) Processor

Galaxy SIII

441

326

468

306

1.6 GHz

1.3 GHz

1.7 GHz

1.4 GHz quad-core Cortex A9

octa-core Exynos 5 Octa

dual-core Apple A6

quad-core Snapdragon 600

Memory

2GB

1GB LPDDR2

2GB DDR

1GB

Storage

16/32/64GB**

16/32/64GB

32GB/64GB

16/32/64GB**

Front camera

2MP

1.2MP

2.1MP

1.9MP

Back camera

13MP

8MP

4MP

8MP

Android 4.2.2

iOS 6

Android 4.1.2

Android 4.0.4

130g

112g

143g

133g

Operating system Weight

Source: manufacturers

COURTESY OF SAMSUNG

In an ideal world, Techeye would have covered the Samsung Galaxy S4 last week. But we don’t live in an ideal world, as evidenced by the fact that deep-fried food is unhealthy and the way nurses giggle when we take our shirt off for medical tests.

So here’s our belated take on the S4.

It’s OK. Nice. Interesting-ish.

Ever longed for a short-term life companion? Let us know: techeye.wbj@gmail.com

Museums, galleries and venues in Warsaw Centre for Contemporary Art at Ujazdowski Castle ul. Jazdów 2 www.csw.art.pl Czarna Gallery ul. Marsza∏kowska 4 www.czarnagaleria.art.pl

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

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

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

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

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

Simonis Gallery ul. Burakowska 9 www.simonisgallery.com State Archaeological Museum in Warsaw ul. D∏uga 52 www.pma.pl State Ethnographic Museum ul. Kredytowa 1 www.ethnomuseum.pl Historical Museum of Warsaw Old Town Square 28-42 www.mhw.pl History Meeting House of Warsaw ul. Karowa 20 www.dsh.waw.pl Warsaw Philharmonic ul. Jasna 5 www.filharmonia.pl Warsaw Rising Museum ul. Grzybowska 79 www.1944.pl

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

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

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

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

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