WBJ #18 2013

Flying for the fjords?

New faces

The latest potential buyer for LOT is a Norwegian low-cost carrier

WBJ profiles the two new ministers in the Tusk government

4

WWW.WBJ.PL

7

VOLUME 19, NUMBER 18 • MAY 13-19, 2013 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

Since 1994 . Poland’s only business weekly in English

Building an alternative

ENERGY IN FOCUS Analysis of Poland’s solar, nuclear and shale gas sectors 10-11

LOKALE IMMOBILIA REAL ESTATE • Gdynia Waterfront • Q1 office report • Cyprus and CEE 16-18

REPORTER

In this issue News . . . . . . . . . . . . . . . . . . . . . . .2-6 Business . . . . . . . . . . . . . . . . . . . .7-8 European Economic Congress . . . .9 Energy in Focus . . . . . . . . . . . .10-11 Cover Story . . . . . . . . . . . . . . .12-13 Finance & Economics . . . . . . . . . .14 Opinion & Analysis . . . . . . . . . . . .15 Lokale Immobilia . . . . . . . . . .16-18 The List . . . . . . . . . . . . . . . . . . . . . .19 Markets . . . . . . . . . . . . . . . . . . . . .20 Sports . . . . . . . . . . . . . . . . . . . . . . .21 Lifestyle . . . . . . . . . . . . . . . . . . . . .22 Last Word . . . . . . . . . . . . . . . . . . . .23

Poland’s only openly gay MP, Robert Biedroƒ, talks about the potential for a new leftist formation, as well as the country’s social progress 12-13

Cut off in the UK

Revving up

The UK government has announced a tightening of immigration controls and handouts to foreigners

The auto industry is providing some welcome good news to an otherwise gloomy economic picture 8

3

NEWS

www.wbj.pl

Bond yields set another record low Poland’s Finance Ministry sold nearly z∏.6.5 billion worth of treasury bonds at an auction on Thursday. Total demand was recorded at z∏.9.03 billion and yields fell to a record low of 2.55%.

Finance Minister Jacek Rostowski was quick to announce the fact on Twitter. “Yields on our five-year bonds fell to another record low: 2.55% – twice as low as a year ago! An evidence of trust in our economy,” he wrote.

Man attacks tourists at Wawel Castle A 48-year-old man will be kept under arrest for two months after an attempted assault on tourists at Wawel Castle in Kraków. Last Wednesday, the man attempted to drive his car up Wawel Hill, but was unable due to the large crowds. Witnesses said he then got out of his car and attempted to assault the tourists with an axe.

Security guards fired warning shots into the air, and at the car’s wheels. The man was reported to have screamed, “Wawel is mine, and I don’t want any guests!”

MAY 13-19, 2013

IN THE SPOTLIGHT

Numbers in the News

Joanna Mucha: ‘Material Girl’?

€79.9 million

is how much the European Commission has demanded Poland return in farm subsidies, due to alleged improper auditing of the granting process.

€12.5 billion

was the value of exports from Poland in March, 3.2 percent higher month-on-month and 2.1 percent lower year-on-year according to data from the Export Credit Insurance Corporation.

z∏.6 million

COURTESY OF WIKIMEDIA COMMONS

2

is how much Poland’s Supreme Audit Office has accused the Ministry of Sport and Tourism of “misspending” on concerts and other events on the National Stadium.

The Polish media’s focus has honed in on Sports Minister Joanna Mucha after an investigation by Poland’s Supreme Audit Office (NIK) found her ministry had misappropriated z∏.5 million for a Madonna concert at the National Stadium in Warsaw. Speculation is now that Ms Mucha may be on the chopping block; two other government ministers have been sacked over the past few weeks.

The NIK audit found that the ministry spent money intended for promotion of the European soccer championships on several other events, including concerts and a soccer game held at the National Stadium. But the bulk of the funds went towards the organization of the

Madonna concert held there on September 1, 2012. The concert cost the ministry nearly z∏.5 million in losses after the organizers, NCS, a company established to operate the venue, failed to find a sponsor for the event.

NCS’s management claimed the concert would promote the stadium after the European soccer championship tournament ended in August 2012.

Among other failures, the Madonna concert debacle was a key reason why NCS was stripped of its right to operate the stadium this past January.

Ms Mucha disputes NIK’s conclusions. According to her, the funds were earmarked not for the promotion of the soccer tournament, but for testing the stadium. She added that

the Ministry of Finance approved all of the spending.

“Every time we send an invoice to be paid, we need the Finance Ministry’s approval, and each time we received approval. The ministry never had any misgivings as to how the [funds] should be spent,” Ms Mucha added.

But though Ministry of Finance confirms that it granted the funds to Ms Mucha’s ministry and approved the spending, it said that the invoices didn’t specify on which events the money was to be spent. It added that the money was earmarked for promoting volleyball among Poland’s youth, as well as activities related to the European soccer championship.

Jacek Ciesnowski

15% is the number of Poles who told pollster CBOS that they are unemployed. The Labor Ministry estimates unemployment at 14%.

Quote of the Week “Wawel is mine, and I don’t want any guests!”

Grzegorz Â., a 48-year-old man, after he was arrested for an attempted assault on tourists at the historic Wawel Castle in Kraków.

Figures in focus Tax collectors Total tax revenue in selected EU states (as a % of GDP) 50 * Highest in EU ** Lowest in EU

40 30 20 10

In a vote last Friday, Poland’s Sejm, the lower house of parliament, passed a draft law that invalidates former Justice Minister Jaros∏aw Gowin’s reform of the court system. The reform, introduced in early January, dissolved 79 small local courts and turned them into divisions of larger units.

Calendar

May/June MAY 13-15 EUROPEAN ECONOMIC CONGRESS

Sejm approves LOT privatization law Location: Web:

This congress will feature a number of debates and meetings, featuring 6,000 guests representing Poland and other European countries, who will discuss the most significant matters of economic and social development in Europe.

Katowice www.eecpoland.eu

JUNE 6 ECR FORUM FOR COOPERATION Event:

Location: Web:

This forum is an annual conference for top managers from the FMCG sector. Participants represent manufacturers, retail chains, agents, small retailers, distributors and providers of logistics, marketing and IT services.

Hotel Marriott, Warsaw www.ecr.pl/forum2013

7-9

WALLSTREET CONFERENCE

Event:

This conference is the largest meeting of individual stock exchange investors in Poland, organized annually by the Association of Individual Investors. It provides an opportunity to meet prominent analysts and to participate in discussion panels.

Hotel Go∏´biewski, Karpacz www.sii.org.pl

Location: Web:

24-26 EUROPEAN FINANCIAL CONGRESS Event:

Location: Web:

This congress, organized by the Gdaƒsk Institute for Market Economics – Gdaƒsk Academy of Banking, provides space for pragmatic debates among business, political and academic circles. This year’s edition will focus on financial security and European integration.

Sopot www.efcongress.com

*

d Lit

hu an

ia*

d

lan Ire

in

Po lan

Un

ite d

Sp a

rm an Kin y gd om Hu Cz ng ec h R ary ep ub lic

nc e

Ge

rk*

The EU celebrated Europe Day last week. But did the EU’s creators underestimate European citizens’ attachment to the nation-state? And what choices do the continent’s leaders face today? Log on to WBJ.pl for an analysis from Stratfor.

De nm a

Decide, Europe

Event:

Last week the Sejm voted in favor of a law proposed by the government that paves way for the privatization of troubled state-owned airline LOT. The new regulations will allow the State Treasury to sell a stake of more than 51% in the firm. The privatization plan will now be sent to the European Commission for approval. ●

0 Fra

On WBJ.pl

Sejm rejects Gowin’s court reform

Source: Eurostat

Company index Accenture ..............................................16 Acteeum Central Europe ......................16 AgustaWestland ......................................8 Asseco ................................................8, 20 Azoty Pu∏awy ............................................4 Bank of Cyprus ......................................18 BBSG ........................................................7 BNP Paribas ..........................................17 Boeing ......................................................7 Bumar ......................................................9 Casio ......................................................23 CBOS ........................................................2 CBRE ................................................16, 17 CCC ........................................................16 Colliers ..................................................18 Czech Airlines ..........................................7 Danske Bank ..........................................14 EBRD ......................................................11 EDF ........................................................10 Enea........................................................10 EuRoPol Gaz ..........................................10 Export Credit Insurance Corporation......2 ExxonMobil ............................................11 Fennovoima ............................................10 Ferrari ....................................................23 Fiat Auto Poland ......................................8 Fonciere Euris ........................................17 FX Energy................................................11 Gazprom ............................................4, 10 Grupa Lotos..............................................9 Heitman ..................................................16 HSBC ......................................................14 Hublot ....................................................23 Inter IKEA Group ....................................16 Jones Lang Lasalle ............................8, 17 KGHM......................................................10 Konsalnet ..............................................17 Korean Air ................................................7 Kulczyk Holding ......................................9

Laiki Bank ..............................................18 Libra Project ..........................................16 LOT....................................................2, 4, 7 ManpowerGroup ......................................8 Marathon ................................................11 Markit ....................................................14 Marriott Courtyard ................................16 MB&F......................................................23 ML Systems..............................................8 Montegrappa ..........................................23 Neinver ..................................................17 Norwegian Air Shuttle ............................7 Opel Polska ..............................................8 Patek Philippe ........................................23 Pekao ......................................................16 PGE ........................................................10 PGNiG ....................................................11 PKN Orlen ................................................9 Play ........................................................17 Porr Polska ............................................16 Pratt & Whitney........................................8 PZL Âwidnik..............................................8 PZL Mielec................................................8 Samar ......................................................8 San Leon Energy ....................................11 Schneider ..............................................17 SwedeCenter ..........................................16 Synthos ..................................................20 Talisman ................................................11 Tauron ....................................................10 Twitter ......................................................2 University Business Park ......................16 Volkswagen Poznaƒ ................................8 X-Trade Brokers ....................................20

4

NEWS

www.wbj.pl

MAY 13-19, 2013

International

As sentiment towards Eastern European immigrants sours in the UK, government handouts will be harder to obtain In a speech to parliament last week, Queen Elizabeth II announced British government plans to restrict immigration to Europe’s thirdlargest economy. “My government will bring forward a bill that further reforms Britain’s immigration system.

The bill will ensure that this country attracts people who will contribute and deters those who will not,” she said in a speech prepared by the government.

country illegally from being able to obtain driver’s licenses.

Businesses caught employing illegal foreign workers would face bigger fines.

Migrants’ access to the NHS would be restricted and temporary visitors would have to “make a contribution” to the cost of their health care. Also, under the proposed laws, foreign-born criminals could be deported more easily.

Earlier this year, UK Prime Minister David Cameron had already announced that nonBritish EU citizens will now receive an unemployment allowance for a maximum of six months. “The last government, when Poland and a lot of other countries joined, did not put controls in place,” Mr Cameron said.

Autumn crackdown The bill in question, scheduled to be presented to parliament in autumn this year, proposes measures such as requiring landlords to check their tenants’ immigration status and blocking immigrants in the

Half a million Poles Since Poland and seven other CEE countries joined the EU in May 2004, around 66 percent of all citizens migrating from those countries to the UK have been Polish citizens,

according to official UK statistics. In December 2003, there were 75,000 Polish nationals living in the UK. By the end of 2010, that number had risen to 532,000.

However, in recent years, Polish immigration to the UK has declined significantly. It hit a peak of 96,000 a year in 2007 but then declined to 39,000 in 2009.

During a 2011 census of people living in the United Kingdom, 521,000 Polish-born people were recorded as UK residents. Poles are the second-most populous ethnic minority in Britain and Polish is the most commonly spoken foreign language in the UK.

Shift in political mood However, in recent months, what has caused palpable concern, and even anger, in the UK is the fact that as of 2014, Bulgarians and Romanians will be eligible to work within the EU without restrictions.

Tabloid reports of up to 400,000 Romanians and Bul-

COURTESY OF THE BRITISH PRIME MINISTER’S OFFICE

Polish immigrants in focus as British government tightens controls

David Cameron has been forced to harden his stance on immigration garians moving to the UK fueled a campaign waged by the nationalist and anti-immigration United Kingdom Independence Party (UKIP) during a February parliamentary by-election in Eastleigh, the results of which shook the British political establishment.

Although the pro-European and progressive Liberal

Democrats held on to the seat, the UKIP’s candidate edged out Mr Cameron’s Tory candidate for second place, receiving roughly 28 percent of the vote, a 24 percent net gain for the party compared to its previous result there. Mr Cameron’s rhetoric on immigration has since hardened.

In a March interview with the BBC, the UKIP’s leader,

Nigel Farage, said he was amazed to see the size and the rapid development of the Polish quarter in the city of Peterborough, in eastern England.

“But the worst thing was a sense of enmity that has grown up between much of the local population and the large number of Polish people living there,” Mr Farage added.

Remi Adekoya

Changes in government

Marek Biernacki is likely to continue in his predecessor’s footsteps. That would be good news for business

When Prime Minister Donald Tusk announced his decision to dismiss Miko∏aj Budzanowski from his post as treasury minister, it came as no surprise. It had embarrassed the government when it came to light that Mr Budzanowski did not know about a deal, announced in early April, between a partially Polish state-owned company and Russia’s Gazprom to conduct a feasibility study for building a gas pipeline through Poland’s territory.

Mr Budzanowski’s dismissal was welcomed by the opposition Law and Justice party, with Jaros∏aw Kaczyƒski, the party’s leader, saying that the government had “managed” to fire an incompetent minister.

But the prime minister’s appointment of W∏odzimierz Karpiƒski in Mr Budzanowski’s place met with little reaction.

After controversially claiming Polish embryos were being illegally sold to Germany for experiments, Jaros∏aw Gowin was dismissed as justice minister by Prime Minister Donald Tusk in late April, and replaced with Marek Biernacki.

Mr Gowin, who was decidedly pro-business, was often referred to as the leader of a strongly conservative faction in the ruling Civic Platform.

He consistently opposed civil unions, especially for homosexuals, and moved to block Poland subsidizing the in vitro procedure for childless couples. Mr Biernacki is reportedly no less conservative than his predecessor.

A relative unknown The reason could be that even with his long political career, Mr Karpiƒski has until now mostly remained under the radar. He

RYSZARD HO¸UBOWICZ/WIKIMEDIA COMMONS

Until now, the new treasury minister had hardly made a blip on Poland’s political radar

Treasury Minister W∏odzimierz Karpiƒski has been a member of the prime minister’s Civic Platform party since 2001, being elected to parliament three times. He has also served in the local government in his hometown of Pu∏awy, in eastern Poland.

Before his nomination, Mr Karpiƒski held the position of secretary of state in the Ministry of Administration and Digitization. He was also a member of the management board of chemical giant Azoty Pu∏awy between 2003 and 2005. Prior to his appointment, his biggest

brush with the media had been when he ran against the flamboyant Janusz Palikot for local leadership in Civic Platform three years ago, a race he lost.

Mr Karpiƒski will have to catch up quickly, as saving troubled state-owned airline LOT will be his top priority, just as it was for his predecessor. One thing is sure, while Mr Karpiƒski is relatively unknown in Polish politics, he won’t be when his work is finished, regardless of the result.

Jacek Ciesnowski

Same stance A former interior minister and lawyer by profession, Mr Biernacki told the TV station TVN24 that “[the Justice Ministry’s stance on] social issues will remain where it was. This is my position and also, I wish to emphasize, the position of Prime Minister

COURTESY OF THE MINISTRY OF JUSTICE

A closer look at the two new ministers in Prime Minister Donald Tusk’s government

Justice Minister Marek Biernacki Donald Tusk.”

Mr Biernacki, echoing Mr Gowin’s rhetoric, called civil unions an attempt to create “quasi-marriage relationships.” This would be against the Polish constitution, Mr Biernacki said.

Importantly for Poland’s business environment, Mr Biernacki told Dziennik Ba∏tycki he would continue his predecessor’s deregulation policies. In April, 50 of Poland’s roughly 380 regulated professions were opened

up. Mr Gowin had planned further deregulation tranches and the new justice minister has said he will continue his predecessor’s deregulation work.

Asked about his priorities as justice minister, Mr Biernacki said that he wanted to improve the work of prosecutors and make court proceedings more efficient. Poland’s slow-moving justice system has been a frequent thorn in the side of Poland’s business Remi Adekoya community.

6

NEWS

www.wbj.pl

MAY 13-19, 2013

International

The latest rotation comprises the last “large” contingent before withdrawal in 2014 The current rotation of Polish soldiers in Afghanistan – the 13th thus far – began last Tuesday and features a reduced number of troops compared to those that came before it, as Poland gradually prepares to withdraw from the country and shift more responsibilities to the Afghan military.

Overall, 1,600 soldiers and personnel will be stationed in Afghanistan and an additional 400 troops will be stationed in Poland, ready for immediate deployment. The previous rotation comprised 1,800

troops, and the one before it 2,500.

The Polish army says that the current rotation is the country’s last large contingent serving in Afghanistan. The next rotation, set to deploy in the fall, will be Poland’s last and will include far fewer troops. Poland plans to withdraw all of its troops from Afghanistan in 2014.

The Polish forces, part of the ISAF international mission, have been present in Afghanistan since 2002, and have been conducting security operations in the Ghazni province since 2008. The Afghan army will resume control over the territory during the current Polish rotation.

This will entail the Polish military’s withdrawal from smaller

military bases scattered around the region to the province’s capital city of Ghazni.

When that transition is made, Polish soldiers won’t be sent on combat patrol missions. They will only assist local forces with medical services and will provide air and artillery support if needed.

Afghan soldiers will soon take over patrolling a crucial 140km-long road between Kabul and Kandahar, which has been the subject of numerous terrorist attacks.

According to estimates from Poland’s Ministry of Defense, this year the Polish mission to Afghanistan will cost z∏.508.9 million, with the current shift costing some z∏.177 million.

Jacek Ciesnowski

SHUTTERSTOCK

Poland reduces troops in Afghanistan

The sun is setting on Poland’s military involvement in Afghanistan

EC demands Poland pay back €80 mln in agricultural subsidies The European Commission is demanding that Poland pay back €79.9 million in farm subsidies that the country received from the EU’s Agricultural Fund. According to the Commission, Polish bureaucrats in charge of distributing the funds did not

properly verify applications filed between 2004 and 2006.

As a result, some of the subsidies granted between 2007 and 2010 were awarded to farmers who should not have received them, the EC says.

The applications in question requested aid for so-called

“semi-subsistence farms,” small family-owned farms specializing in growing enough food to feed themselves and their families.

“As far as Poland is concerned, the case concerns mainly state controls. The mistakes were usually made not by

farmers, but by the administration, which did not properly verify farmers’ claims for direct subsidies,” an EC spokesperson said.

The nearly €80 million Poland has been asked to pay back could represent just the tip of the iceberg, since the EC

audit covered only the period between 2007 and 2010. If the Commission finds similar deficiencies came after that period, it could tell Poland to repay even more.

Overall, the EC has demanded that 14 member states pay back a total of €230

million in agricultural subsidies.

Poland will appeal the decision, but if it is unsuccessful, the funds will be taken out of the next tranche of agricultural subsidies. In the proposed budget for 2014-2020, Poland is set to JC receive €28.5 billion.

SUBSCRIBE FOR 1 YEAR AND SAVE UP TO 50% OFF THE COVER PRICE Choose one option by checking the box

❏ WBJ IS NOW AVAILABLE IN DIGITAL FORMAT. READ WBJ AS A PDF OR E-ZINE.

OPTION 1

WBJ Electronic

Wa Warsaw Business Journal PDF version and a link to view WBJ in e-zine format delivered to your e-mail address each week for 12 months. for Everywhere: zł.424

❏

OPTION 2

WBJ Print

ENQUIRIES A M I C HA LI K @ VA L K EA .C O M, O R C A L L + 4 8 ( 2 2 ) 6 78-9912

In Europe: €297

OPTION 3

Outside Europe: €374

WBJ Premium

Warsaw Business Journal print edition delivered each week to your address for 12 months, plus WBJ PDF version and a link to view WBJ in e-zine format delivered to your e-mail address each week.

Also receive Investing in Poland 2012 (zł.78 value) and Book of Lists 2012 (zł.100 value).

In Poland: zł.691

Warsaw Business Journal print edition delivered each week to your address for 12 months, plus receive Investing in Poland 2012 (zł.78 value) and Book of Lists 2012 (zł.100 value).

In Poland: zł.550

❏

In Europe: €330

Outside Europe: €407

Please fax this form to: +48 22 639 85 69 or mail it to our office: Subscriptions Warsaw Business Journal Valkea Media S.A. ul. Elblàska 15/17, 01-747 Warsaw, Poland

CLIENT DETAILS

PAY MENT OPTIONS (please check one)

Name ......................................................................................................................

Company ......................................................................................................................

Address ......................................................................................................................

Postal code ......................................................................................................................

City ......................................................................................................................

Country ......................................................................................................................

Telephone/Fax ...................................................................................................................... e-mail ......................................................................................................................

NIP (Poland)/EU VAT number (EU countries) ......................................................................................................................

❏ Pre-payment by bank transfer upon receipt of a pro-forma invoice. The pro-forma invoice will be sent to you immediately upon receipt of your order.

Your subscription will start within one week of payment. ❏ Credit card: ❏ American Express

❏ Visa

❏ Mastercard

Cardholder name ......................................................................................................................

Number ......................................................................................................................

CVV2/CVC2/CID

Expiration date

....................................................... ............................................................

Signature ......................................................................................................................

BUSINESS

www.wbj.pl

Airlines

Norwegian Air may be eying LOT Norwegian and Polish media reported in April that Norwegian Air Shuttle (NAS) CEO Bjørn Kjos met with Polish Minister of Finance Jacek Rostowski to talk about a potential takeover of troubled Polish state-owned airline LOT. NAS later confirmed that Mr Kjos visited Poland but didn’t specify for what reason.

“It’s positive news that someone is interested in buying LOT, since a money-losing airline is a hard thing to sell in the current economic situation,” said Bartosz Baca, an aviation expert at BBSG, an advisory company specializing in the aviation sector. He underlined, however, it is a long and rocky road from the first show of interest to a final deal.

“We must take into consideration the European Commission’s decision regarding the loan LOT received at the end of last year from the state. If EC decides it has to be returned, then the chances of Treasury selling LOT are slim to none,” Mr Baca explained.

While LOT has a deadline of June 20 to present its rescue

COURTESY OF BOEING

The company’s CEO visited Poland for talks with top government officials

Will LOT Dreamliners fly under the Norwegian brand soon? plan to the EC, the Commission’s decision might not be known until as late as 2014.

What’s the price?

According to Norwegian media, the main reason why the low-cost carrier is interested in acquiring LOT is its fleet of Dreamliners. NAS plans to expand its services to long-distance routes and the newest Boeing machines would fit the bill nicely. Although Norwegian Air Shuttle ordered eight Dreamliners, it hasn’t received

one yet, as the machines had technical problems which kept them grounded.

LOT’s financial troubles are not an isolated incident within the CEE region. In April the sale of a minority stake in Czech Airlines was finalized.

Korean Air paid just €2.64 million for 44 percent of the Czech state-controlled carrier.

“We only had two options: either find a strategic partner or consider liquidation of the airlines,” Czech Finance Minister Miroslav Kalousek said.

The latter path was chosen in Hungary, where Malev Airlines ceased operations last year.

This puts LOT’s financial problems into perspective.

Czech Airlines is similar in size to LOT, but recorded much smaller losses. In 2011, Czech Airlines lost €9.3 million, while LOT recorded a nearly €35 million net loss. With these figures it’s hard to expect State Treasury to get a good price for LOT, if an investor does decide to buy it.

Jacek Ciesnowski

7

FinMin wants to tax Polish-owned foreign companies The Ministry of Finance has prepared draft legislation on the taxation of revenues of Polish-owned foreign companies.

The bill is aimed at fighting tax avoidance by Polish businesses.

Taxation is to apply to controlled foreign corporations (CFCs) that are set up only for the purpose of avoiding Polish taxes. The legislation requires that such companies owned by Polish businesses or individuals pay a 19 percent tax on their revenues.

A company would be regarded as a CFC if at least half of its revenue came from passive sources (dividends, interest, share sales, licenses, and so on). The Polish share-

SHUTERSTOCK

MAY 13-19, 2013

holder would have to hold at least 25 percent in the firm.

The rules would apply to companies registered in countries with tax rates at least 25 percent lower than Polish ones.

The Finance Ministry stated that similar solutions against tax avoidance have been implemented in numerous countries in the EU and worldwide and are in accordance with EU law.

According to the ministry, the new regulations would not infringe upon the provisions of international agreements on avoiding double taxation. If passed, the new tax would become law in 2014.

Kamila Wajszczuk

8

BUSINESS

www.wbj.pl

MAY 13-19, 2013

Auto industry

Foreign investment

Polish car makers gaining speed

From Dubai to Rzeszów

Market leaders Number of cars produced in Poland in Q1 Fiat Auto Poland

103,845

Volkswagen Poznaƒ

58,947

Opel Polska

39,821 Source: Samar

The German market seems to be bouncing back as well, recording a nearly 4 percent rise in car sales last month.

Since nearly 99 percent of cars assembled in Poland are exported, the economic situation in other countries – especially in Europe – is crucial for its success.

COURTESY OF THE CITY OF RZESZÓW

While car sales in Europe have been declining for 18 months straight, employment in Polish automotive plants grew to levels unseen since 2008, a record year for the Polish car industry in terms of employment. At the end of Q1 2013 there were over 157,000 people working in the sector, which is 3,000 more than at the end of 2012.

In April, the number of cars produced in Poland rose by 1 percent year-on-year.

The figure itself may seem unimpressive, but considering that in Q1 of 2013 factories produced nearly 30 percent fewer cars than a year before, it shows a welcome sign of recovery. “It seems that very slowly the situation is also improving in Polish factories,” said industry research firm Samar, commenting on the results.

That is the feeling in Fiat Auto Poland, which produces over 50 percent of cars made in Poland. The firm’s Tychy plant, which had laid off near-

ly 1,500 at the end of 2012, recently hired back 150 of them, albeit only temporarily.

It also announced that because of high demand, its production plants might resume operating on Saturdays as well.

According to a recent poll conducted by HR firm ManpowerGroup, 67 percent of enterprises in the automotive sector plan to increase their level of employment, while only 9 percent plan to decrease staff.

With the European market on the decline, Polish companies are looking for other markets, increasing their sales to the US, China and Russia.

Jacek Ciesnowski

The increasingly hi-tech city of Rzeszów has the most students per capita in the whole of Europe, according to its mayor

COURTESY OF GM

Despite disappointing figures from Europe, the Polish automotive sector is showing signs of recovery

Poland’s automotive industry is showing signs of a rebound

At the AIM congress in the UAE this month, the southeastern Polish city seems to have made a good impression, at least on the young Speaking at the Annual Investment Meeting (AIM) congress in Dubai this May, Tadeusz Ferenc, mayor of Rzeszów, invited potential investors to his city touting its reputation for having a young and highly skilled labor force, its status as an aviation hub and its ambition to become an IT center in Poland.

“We have the most students per capita in the whole

of Europe,” said Mr Ferenc.

Mr Ferenc added that while Rzeszów had firmly established its reputation as an aviation hub headquartering companies like PZL Mielec, which produces the famous Black Hawk helicopter, PZL Âwidnik (owned by AgustaWestland) and Pratt & Whitney, the city now wants to become a general IT hub as well. It can already boast being the seat of Asseco, Poland’s biggest IT firm, and one of the largest in the region.

Mr Ferenc hopes Rzeszów’s young and mostly technically educated workforce and its business-friendly activities (the city assigns potential investors a city official who walks them through

all the formalities), will do the trick.

Rzeszów’s efforts are already bearing some fruit.

This month it was announced that ML Systems will invest z∏.16 million in a production hall in the Mielec special economic zone. The company expects to employ 20 people at the facility. Plastwag also announced recently it would invest z∏.10 million, also in a production hall, and also in Mielec. They plan to employ 10 people.

While at the congress, Rzeszów’s mayor was informed by a university in Dubai that some of its students are interested in coming to his city, mainly to study aviation.

Remi Adekoya

Market comment

Tomasz Puch, head of office & industrial investment Jones Lang LaSalle Confidence in Poland remains high as a growing number of institutional investors perceive it as a core market for their investment activity. 2013 has started strong, with an investment volume of €748 mln thus far. The largest share of all

2013 transactions to date belongs to the office sector (€424 mln), followed by industrial (€184 mln) and retail (€126 mln), with a marginal share of hotel deals. The sale of New City in Warsaw (Mokotów) and Green Towers in Wroc∏aw illustrates increasing liquidity in the Warsaw submarkets and other major cities in Poland, that had up until recently suffered from limited investor interest. Looking at the latest office transactions alongside deal terms agreed, we expect this trend to continue and interest to grow, which will in turn prompt an increase in prices. We also envisage industrial investment volumes for 2013 to come close to the record results of 2012. The two-tier market will continue, with active core investors maintaining prime yields in all sectors and those investors seeking riskier assets which offer a higher rate of return. ●

BROUGHT TO YOU BY JONES LANG LASALLE

EUROPEAN ECONOMIC CONGRESS

MAY 13-19, 2013

International business

COURTESY OF MACIEJ ÂMIAROWSKI/KPRM

Africa in focus

Prime Minister Donald Tusk meets with Nigerian President Goodluck Jonathan

After Prime Minister Donald Tusk’s visit to Nigeria last month, Poland continues to step up efforts to increase business ties with Africa’s fastgrowing economies Poland’s economic cooperation with Africa will be one of the main themes of the upcoming European Economic Congress scheduled to be held in the southern Polish city of Katowice on May 13-15. At a special Africa-Central Europe forum, there will be debate panels discussing investment opportunities, economic potential and possible trade, as well as political cooperation between the European Union and Africa.

Some high-profile African delegates are expected to take part in the panel discussions, including El Hadji Malick Gakou, Senegal’s trade and industry minister from 2012 to 2013.

Where is the growth?

Ever since global financial institutions such as the IMF released forecasts predicting that Africa as a continent will

have the world’s fastest-growing economy over the next five years, and seven of the world’s 10 fastest-growing national economies, business interest in the world’s second-most populous continent has risen sharply. This comes at a time when Europe and its biggest trade partner, the US, struggle to grow their economies.

In Poland, the government is making a concerted effort to improve business ties with Africa.

The CEE’s largest economy currently does a meager 1 percent of its trade with Africa. In April of this year, Prime Minister Donald Tusk paid a visit to Nigeria to start the bid to change that state of affairs.

Mr Tusk met with Nigerian President Goodluck Jonathan and discussed cooperation in trade, energy projects, agriculture and international policy.

The two leaders also discussed possible close cooperation between the two countries in the area of natural resources mining (gas, oil, copper) as well as building and modernizing Nigerian refineries. Representatives of major Polish companies such as PKN Orlen, Grupa Lotos, Bumar and Kul-

czyk Holding were part of the delegation accompanying the Polish prime minister.

First fruits During Mr Tusk’s visit, a cooperation agreement was signed between the Polish Information and Foreign Investment Agency and the Nigerian Investment Agency. According to the agreement, the Nigerian agency is to support Polish enterprises in establishing economic cooperation: it will provide information on the conditions of making investments and possible state aid.

Also, an agreement was signed between the Polish economy ministry and the Nigerian industry, trade and investments ministry. The agreement commits Poland and Nigeria to conduct annual consultations at a ministerial level on investment projects and cooperation between businesses.

Likewise, a strategic partnership agreement was signed between the Polish and Nigerian ministries of foreign affairs, leading to both countries’ commitment to organize annual mutual policy consultations.

Remi Adekoya

Panels to watch out for in Katowice: If you’re attending the European Economic Forum in Katowice this week, here are some of the top panel discussions of interest.

The Europe of growth. The future of the European economy.

On the panel: Martin Kuba – Minister of Industry and Trade of the Czech Republic Tomáš Malatinský – Minister of Economy of Slovakia Janusz Piechociƒski – Deputy Prime Minister and Minister of Economy of Poland Mihaly Varga – Minister of National Economy of Hungary Varujan Vosganian – Minister of Economy of Romania Moderator: Jerzy Buzek – Member of the European Parliament, President of the European Parliament 2009-2012, Prime Minister of Poland 1997-2001 Go Global! World, Europe, Africa. Time for New Deal On the panel: Elham Mahmood Ahmed Ibrahim – Commissioner for Infrastructure and Energy, African Union James L. Jones – Retired United States Marine Corps General, Former United States National Security Advisor 2009-2012, Supreme Allied Commander Europe 2003-2006 Horst Köhler – President of Germany 2004-2009, managing director of the International Monetary Fund 2000-2004 Jan Kulczyk – chairman of the board of directors, Kulczyk Investments, founder of CEED El Hadji Malick Gakou – Minister of Commerce, Industry and Informal Sector of Senegal 2012-2013

Andris Piebalgs – EU Commissioner for Development Moderator: Aleksander KwaÊniewski – President of Poland 1995-2005 Africa – Central Europe Economic Cooperation Forum Development policy of the EU with regard to Africa.

Support that stimulates both the economy and the enterprise On the panel: Remi Adekoya – politics editor, Warsaw Business Journal Shyaka Anastase – chief executive officer, Rwanda Governance Board Filip El˝anowski – partner, Kancelaria El˝anowski, Cherka & Wàsowski Leszek Jastrz´bski – Polish Member of Parliament Skipper Jones – Honorary Consul of Poland in Kenya Dominik Kopiƒski – Institute of International Studies, University of Wroc∏aw Andrzej ¸upina – Ambassador of Poland to Zaire 1990-1996, Ambassador of Poland in Algeria 1998–2002, Ambassador of Poland in Senegal 2005-2010 Killion Munyama – Polish Member of Parliament Krzysztof Olendzki – Ambassador of Poland in Tunisia 2008-2012 Wojciech Tycholiz – Institute of International Studies, University of Wroc∏aw Moderator: Robert Zduƒczyk – founder, Economic Foundation Poland and East Africa

www.wbj.pl

9

10

ENERGY IN FOCUS

www.wbj.pl

MAY 13-19, 2013

Renewable energy

Bright future for solar power in Poland Poland is one of Europe’s leaders in the production and sale of solar collectors.

According to data collected

by Poland’s National Fund for Environmental Protection and Water Management (NFOÂiGW), Poland ranked third in Europe, a surprising jump from ninth place in 2009. According to estimates, more than 100,000 Poles use various kinds of solar installations, such as solar collectors. In 2011, production and sales of solar collectors in Poland increased by some 70 percent compared to the previous year.

“The solar-collector market was the only renewable energy segment that saw such strong growth,” said Witold Maziarz, a spokesperson for the Fund.

The Institute for Renewable Energy estimates that Poland’s solar-collector market is worth z∏.670 million (not including exports) and that there are 70 companies in Poland producing and sell-

ing the devices. So far solar collectors with a total area of 1.2 million sqm have been installed in Poland. That’s an area three times as big as Vatican City.

The numbers reflect the popularity of solar panels in rural Poland, where they are often installed on rooftops.

Home builders can make use of special loans that are partially financed by the National Fund for Environmental Protection and Water Management and can be used to purchase solar collectors.

Mr Maziarz expects that solar collectors with a total area of some 420,000 sqm will be installed thanks to the loans. He estimates they could reduce carbon emissions by 65,100 metric tons by 2015.

Commercial use not too popular Commercial use of solar energy in Poland, however, is a different story. At a recent conference on photovoltaics in Warsaw, authors of a bill concerning renewable energy sources – former Minister of Economy Waldemar Pawlak and former Deputy Economy Minister Mieczys∏aw Kasprzak – pointed out that Poland boasts only one solar farm with a megawatt of

SHUTTERSTOCK

Solar collectors are becoming popular for individual use, but there still aren’t many commercial investments

The number of solar panels in Poland is growing rapidly solution for the growing need for renewable energy in Poland, although right now it is often overlooked. Out of 4,400 MW of renewable energy capacity installed in Poland as

capacity. There are four others planned with a combined capacity of 4 MW. Their construction should start this year.

Mr Pawlak emphasized that solar energy could be a good

of the end of 2012, only 1.3 MW came from solar farms.

Currently, only 10.55 percent of energy consumed in Poland comes from renewable energy sources, but that num-

ber is expected to grow, since Warsaw has committed to obtaining 15 percent of its energy from renewable sources by 2020.

Jacek Ciesnowski

Nuclear energy

Poland’s nuclear program faces serious problems that could delay or even halt it The prospects of nuclear energy in Poland nearly came to a full stop at the beginning of this year. According to Newsweek PGE, the Polish energy giant responsible for building the country’s nuclear plants, asked the Ministry of Economy to suspend the Polish nuclear program, citing lack of profitability. Prime Minister Donald Tusk quickly rebutted these rumors.

“Poland is by no means abandoning plans to build a nuclear power plant,” he said.

Still, Poland isn’t getting any closer to having a nuclear plant, either.

The government still plans to have two nuclear plants with a capacity of 3,000 MW each. The dates for bringing them online have been pushed back several times; currently the plan is for the first plant to begin operations in 2023, and the second in 2029.

These dates seem unlikely though, considering how much has yet to be done. The planned investments are still waiting for a financial plan.

Deadlines for talks on possible capital involvement and debt financing, as well as for the market model, technical issues and the legal framework of the investment, have already been extended numerous times.

Worth the price?

It’s not only Poland that is having trouble with its nuclear program. With energy prices tumbling in recent years, many European countries have stopped building new plants or expanding the existing ones.

French consortium EDF, which plans to build a nuclear plant in the UK, stopped developing the facility because it wants government guarantees that it will cover the difference in energy prices if it drops below an agreed threshold. The current price of electric energy in the UK is

about €53 per MWh, while EDF has asked the government for a price floor of €106 per MWh in order to provide a yield of 10 percent.

CEE countries face similar problems. The Czech Republic and Slovakia have both stopped expanding their facilities as foreign investors are asking for similar guarantees.

The Lithuanian government is looking for outside help as well and, according to local daily Verslo Zinios, has asked PGE to help with the investment.

SHUTTERSTOCK

Progress on nuclear energy program moving at a snail’s pace

Finnish solution

Still a long way off for Poland

Finland seems the only exception in the EU. Nuclear plants are built there by Fennovoima, a consortium of some 60 Finnish companies that use the bulk of Finnish energy for their own production. They consume what they need from the power plants they co-own and sell the surplus on the market. In Poland, however, only copper-giant KGHM signed a letter of intent with PGE, Tauron and

Enea concerning a construction of a power plant, a letter which lost validity at the end of March, because deadlines were not met.

The much-needed boost for the sector might come from the government again.

Recently, after a mix-up over a proposed second arm of the Yamal pipeline, where officials had not been informed about a memorandum signed

between Polish pipeline operator EuRoPol Gaz and Russia’s Gazprom regarding a feasibility study for building a new gas pipeline across Polish territory, PM Tusk decided to call up a special energy committee.

The new body will encompass representatives from all the government agencies and ministries that are responsible for energy issues.

“Something like that is certainly needed. There are a lot of issues that require close cooperation between ministries. Our plan needs to be unified and supervised by one body,” Aleksander Grad, head of the nuclear project at PGE, told news agency Newseria, citing lack of proper legislation as the biggest obstacle for the sector.

Jacek Ciesnowski

ENERGY IN FOCUS

MAY 13-19, 2013

www.wbj.pl

11

Shale gas

Developments in shale gas industry still mixed

In late April, FX Energy, which is exploring for shale gas in Poland, announced that a test of its natural gas well in north-central Poland was indicating a flow rate of about 5 million cubic feet per day, prompting its share price to jump. The company will now conduct a full production test to determine whether the well could be commercial. The tests are scheduled to begin this week.

FX Energy’s CEO David Pierce said he was “cautiously optimistic” that exploiting the well could be a viable business.

“We will have plans ready for a prompt response if the production test is encouraging,” he added. Meanwhile, earlier this year in March Poland’s natural gas giant PGNiG stated it struck a shale gas flow at its Lubocino-2H borehole in northern Poland.

Likewise for PGNiG, pro-

SHUTTERSTOCK

FX Energy and PGNiG have both struck the unconventional gas in Poland, but others have pulled out, and future regulation remains unclear

A shale-gas drilling rig near Lublin, southeast Poland duction testing is in progress and it is yet uncertain how much gas the area holds.

Results are expected in the coming weeks. Then-Treasury Minister Miko∏aj Budzanowski described PGNiG’s announcement as “good news that should encourage investors to look for shale gas in Poland.”

Whether the news is all rosy is still in question. In 2012

ExxonMobil decided to abandon shale gas exploration and in early May this year, Canadian energy group Talisman also decided to pull up stakes, selling its assets and exploration licenses to San Leon Energy.

“Talisman’s decision to exit Poland is driven by its strategic priority to focus on production in its two core areas, the Americas and Asia-Pacific,” the company said in a statement.

The US’s Marathon also announced it has decided to leave Poland.

Gassing up Meanwhile, as part of its efforts to boost its production of energy from natural gas, Poland announced that it had secured a loan worth roughly z∏.283 million for the construction of the “first large scale” gas-fired power plant in the

country. The loan is being provided by the European Bank for Reconstruction and Development (EBRD).

The combined cycle gas turbine plant in Stalowa Wola, located in the southeast, will have a capacity of 449 MWe/240 MWt and replace old coal-fired power units. It is expected to help cut at least 950,000 metric tons of carbon emissions every year.

The proposed plant is part of Poland’s energy strategy, which requires it to replace inefficient and highly polluting power plants built in the 1950s and 1960s. The country also wants to diversify its energy use from its heavy reliance on coal.

Commenting on the loan, Nandita Parshad of the EBRD said, “The Bank is proud to invest into the modernization of Poland’s power sector with the aim of strengthening efficiency and lowering emissions.”

“Replacement of old coalfired generation units with a modern gas-fired unit allows an increase of combustion cycle efficiency, as well as significantly lowers CO2 and NOx emissions. In addition the project will reduce the Pol-

ish dependency on the coalbased power generation,” she added.

Unfriendly laws?

However, in what could be potentially damaging to Poland’s energy efforts, in March this year new, controversial shale gas extraction rules were proposed by the Polish government. Many companies reportedly expressed concerns over some of the proposed regulations.

For example, it was suggested that a tender would be organized for extraction licenses after exploration work had been completed. This means that companies which have already invested in exploration drilling would not be guaranteed they could profit from extraction on the same license.

Investors also appear to be concerned about plans to create a national shale gas operator. They believe that if the operator holds stakes in licenses, companies’ costs will in fact be higher than the declared 40 percent total tax planned by the government. So far 109 shale-gas exploration licenses have been granted.

Remi Adekoya

POLSERVICE is one of the biggest patent and trademark attorneys firms in Poland.

The firm has been operating on the market since 1964.

POLSERVICE currently employs 43 patent and trademark attorneys (including 33 European patent attorneys) specialised in various areas of technology, law and economy, and teams of experienced lawyers and professional translators.

POLSERVICE PATENT AND TRADEMARK ATTORNEYS OFFICE 73 Bluszczańska Street, 00-712 Warsaw, Poland Phone: (+48) 22 44 74 600, Fax: (+48) 22 44 74 646 Postal Address: P.O. Box 335, 00-950 Warsaw, Poland e-mail: ip@polservice.com.pl www.polservice.com.pl

POLAND

AREAS OF PRACTICE

INTERNATIONAL EXPERIENCE

POLSERVICE provides a variety of services in all fields of industrial and intellectual property protection for companies and individual clients from all over the world. The main fields of activity include:

POLSERVICE is proud of representing more than 2650 clients from more than 70 countries, being both worldwide corporations and local SMEs. Additionally, POLSERVICE has been cooperating with the most renowned patent and trademark firms in all European countries, the United States of America, Canada, South and Central America, Asia, Australia and Africa, which enables the firm to provide efficient legal protection for its clients all over the world.

• patents, utility models and industrial designs • trademarks, trade names, geographical indications • Internet domain names • patent and trademark searches • new plant varieties • copyrights and combating unfair competition • licence agreements and exclusive rights transfer • litigation, enforcement and dispute resolution • anti-counterfeiting and anti-piracy actions • monitoring and payment of renewal fees.

POLSERVICE attorneys represent clients before the Polish Patent Office, the European Patent Office (EPO), the Office for Harmonization in the Internal market (OHIM), as well as before civil, administrative and arbitration courts. They also cooperate with Customs and prosecution authorities.

In each case the firm looks for the best solution to satisfy its clients. An individual and creative approach to all tasks, supported by profound legal and technical knowledge, has earned POLSERVICE the trust of the clients.

POLSERVICE and its attorneys are members of many international organizations gathering companies and individuals dealing with intellectual property protection: AIPPI, INTA, ECTA, LESI, UNION, MARQUES and EPI. The firm’s attorneys, apart from fulfilling their everyday duties, attend numerous meetings, conferences and trainings held in Poland and abroad, also as lecturers or moderators.

As a result of their continuous involvement, many of the firm’s attorneys serve as leaders of these organizations or their respective committees.

Both Polish and international IP magazines ranked POLSERVICE as one of the top trademark and patent firms in Poland.

12

COVER STORY

www.wbj.pl

MAY 13-19, 2013

Exclusive interview

Biedroƒ: Europe Plus wants to ‘build an alternative’ to the status quo

Remi Adekoya: Former President Aleksander KwaÊniewski has formed a new political movement, Europe Plus, which he hopes will be a force on the left of Polish politics. Janusz Palikot, the leader of your party, Palikot’s Movement, has decided to join the grouping, which plans to present an electoral list for the 2014 European Parliament elections.

Where does the movement stand two months after the announcement of its creation?

Robert Biedroƒ: First and foremost, I have observed that there is great hope invested in Europe Plus. Many people are tired of the kind of politics we have seen from the ruling center-right Civic Platform and the biggest opposition party, the ultra-conservative Law and Justice. They therefore welcome every new political initiative with open arms, and this has been the case with Europe Plus.

People are enthusiastic and they are observing us with great interest, but they are also asking where our program is, where our people and party structures are. I think we are currently at a stage where we have invited people and are building the new formation.

The foundation of Europe Plus is Palikot’s Movement, Aleksander KwaÊniewski, MEP Marek Siwiec and smaller leftist parties, such as the Social Democracy of Poland, SDPL, Labor United and the Women’s Party.

Together we want to create a platform where we can sit down and talk, agree on some key issues, write a program, show our ideas and head to the polls with that. Europe Plus is capable of bringing in many organizations to the left of Civic Platform and maybe even some factions from the ruling party itself. If we are able to create the critical mass needed to shake things up on the political scene, then there will be a breakthrough.

So I take it you will be running on the platform of Europe Plus in the 2014 European Parliamentary elections?

I don’t know that yet. It’s still too early for such declarations.

Who is going to decide on the voting list of Europe Plus? Mr

KwaÊniewski? Mr Palikot? Mr Siwiec? I wouldn’t want them to make that decision on their own. I want everybody involved to have a say. We have to create that critical mass and offer Poles a leftist formation of a new quality.

Unfortunately in recent years, the left has not been able to offer Poles that. It pains me to see that the Democratic Left Alliance (SLD) and its leader [former Prime Minister] Leszek Miller, are not open to dialog.

However, the party rank and file want to cooperate with us. In my voting district, SLD members tell me they know their party is too weak to be a real alternative to the strong conservative parties, Civic Platform and Law and Justice.

If Leszek Miller is really interested in winning power – and that is what politics is about, after all – then he should open up to new blood.

Marek Siwiec, an MEP and co-founder of Europe Plus, has even talked of creating Poland Plus, which would take part in domestic elections. What do you think of that idea?

Again, it’s too early for that.

It’s not about the name, it’s about creating a project that will last. Today it’s called Europe Plus, maybe for local government elections it will be Warsaw Plus and for national elections Poland Plus. But what we need is a lasting project that would unite all the fragmented leftist groups in Poland.

It is so wasteful that we allow people such as former President Aleksander KwaÊniewski, former Prime Minister W∏odzimierz Cimoszewicz, former Speaker of the Sejm Marek Borowski, Solidarity legend W∏adys∏aw Frasyniuk, and former minister Barbara Labuda to be scattered in different groups instead of exploiting their electoral potential.

It is those people who should today build an alternative to Poland’s right-wing parties, show that Poland can have a face other than a fascistic one, full of hatred and contempt. Poland can live without all those fears and complexes,

SHUTTERSTOCK

WBJ sat down with Robert Biedroƒ, Poland’s first openly gay MP and a member of the Palikot’s Movement party, to discuss the new Europe Plus political initiative, whether a coalition between his party and the ruling Civic Platform would ever be possible, the government’s record on social issues and homophobia in Poland

MP Robert Biedroƒ says a strong leftist party could garner 30 percent of the vote in Poland without the Smolensk obsession and that sort of crazy nonsense.

In your opinion, how many Poles have views that could be described as leftist?

Let’s ask Poles if they agree that the Labor Code should be liberalized – they will say no.

Do they like all those shortterm “junk” contracts that basically don’t give workers any rights? No. Do they want the church to be separate from the state? Yes. Even some strong Catholics believe the church is too involved in politics in Poland. Let’s ask them about [state refunding for] in vitro [fertilization procedures] and about civil unions. Poles are in favor of both.

But when the country’s first transsexual MP, Anna Grodzka, was proposed by your party to be deputy parliamentary speaker in January, 55 percent of Poles were against her candidacy, according to a Homo Homini survey. That also says something doesn’t it?

How many people supported her candidacy?

Thirty-one percent.

Exactly! Right now in Poland there is no leftist party capable of garnering 30 percent of the vote in any election!

So 30 percent is the potential electorate you see?

Yes, but look at an issue like civil unions. A majority of Poles support it.

Actually, a majority support heterosexual civil unions but are against homosexual civil unions ...

That is true, but the institution of civil unions is neither traditional nor conservative. You have to be an open person to support even heterosexual civil unions. Such people are our potential electorate.

There are such people here

“Sorry, we tried but it didn’t work this time, again. We have to discuss the issue in our party and find a compromise.”

How long has in vitro been waiting for a compromise now? The ruling party can’t come up with a bill because their politicians are bickering over it and will continue to do so till the next elections.

It’s an old game Civic Plat-

“Poland can have a face other than a fascistic one, full of hatred and contempt.” in Poland and they are ready to vote for a party that supports civil unions. We should exploit that, but now we have a situation whereby a part of our natural electorate votes for the ruling party, which has done absolutely nothing regarding social issues in the past six years.

form plays with its two distinct electorates, the more conservative and the more liberal.

They maintain the status quo, using carefully engineered deception. Civic Platform is deceiving the public, because they are not actually trying to resolve any of the issues. They are simply pretending to try.

In January Prime Minister Donald Tusk did try to sanction civil unions in parliament ...

And what was achieved?

Nothing. This is an old game which Mr Tusk’s party has been playing for some time now. First, they let the rightwing radicals in their party loose, then they let the leftist radicals loose. The two groups clash and battle one another to a standstill, and finally the prime minister comes out with a disappointed face and says,

Does that mean you can’t imagine your party, Palikot’s Movement, in a coalition with Civic Platform after the next parliamentary elections?

It is too early to answer that question. I have a good imagination so I can imagine many things. If, for example, Law and Justice were a party like David Cameron’s Tories then I can imagine a coalition with them, too.

However, in Poland, David Cameron would probably be labeled a leftist. I don’t really

care about all those tribal divisions. What counts are the people behind the parties. If in Civic Platform, the concept of an open, modern, progressive Poland carries the day and it is people like MP Dariusz Rosati, Health Minister Bartosz Ar∏ukowicz and government Plenipotentiary for Equal Treatment Agnieszka Koz∏owska-Rajewicz – people who are open – were those who set the tone, then yes, I can imagine a coalition with Civic Platform.

Prime Minister Tusk promised Poles that he would build a civic society, a progressive, European society. “I won’t kneel before bishops,” he said.

Then why has he not liquidated the [state-financed] Church Fund? After all, he promised to do just that.

Let’s imagine an average Pole, who does not hate homosexuals but who has fears regarding what homosexuality could lead to, especially when there are politicians telling him that if gays are allowed civil unions, gay marriage will follow, as will the adoption of children by gay couples, a very controversial and emotional issue. How would you convince such a person to your way of thinking?

I often meet the kind of people you are talking about. I use public transport, so people often come up to me, wanting to chat. Conservative politicians often try to scare people by saying that homosexuals

COVER STORY

MAY 13-19, 2013

will be making ever-bigger demands. Even if they do, we have a parliament after all, and that democratically elected parliament will have to approve any far-reaching changes regarding homosexuals.

So, 231 MPs would have to support gay marriage or the adoption of children by gay couples for it to become law.

Society will be the one to make that choice through its elected representatives. That is the best guarantee for people that nothing will happen without the approval from the majority. Society will decide how far we go. We have to decide where the boundaries are. In my opinion, the boundaries here in Poland are at civil unions.

You don’t see a chance for more in today’s Poland?

There is no consent for more in Poland because people don’t understand all this stuff, they aren’t ready for it. But there is a will to regulate the status of people living in informal relationships today.

I encourage that debate.

The argument about adopting children is off the mark because gays can adopt children in Poland today anyway.

There is no ban on gays adopting children today. Of course, informal gay couples cannot adopt because you have to be married to adopt. But there is

the option for people like me, a single gay man, to adopt a child as well.

I can do it and no institution has the right to deny me a child because I am gay. That is the law in Poland today. The right is manipulating people on this score. Besides, gays who want children can get them from other sources such as from earlier relationships.

But most of all, we need to regulate the status of children who already live in such rela-

are the dilemmas we are facing today.

Lech Wa∏´sa made some controversial statements about homosexuals recently, saying that since they are in the minority they should “sit at the back rows of parliament or even behind a wall.” When WBJ interviewed Mr Wa∏´sa after those statements, he said he had been misunderstood.

Do you think criticism of him has been too harsh?

“The argument about adopting children is off the mark because gays can adopt children in Poland today anyway. There is no ban on gays adopting children.” tionships today. I know lesbian couples where one is the natural mother of a child. So should the other woman have some rights to decide on the health and future of that child?

Imagine there is an accident and the natural mother dies, the child survives but a decision needs to be made as to whether to operate or not.

Should that woman, who may have raised that child for five or 10 years, have the right to make such a decision? In my opinion, yes. To do otherwise would be inhumane. Should that woman also have the right to bury her lost partner? These

Can you imagine that anybody in Poland, even Lech Wa∏´sa himself, could say something like that about Jews, that since they are a minority they should sit behind a wall? What would happen if somebody were to say something like that?

It is not a matter of political correctness. It is a matter of respect. John Godson and Killion Munyama are both black MPs. Both are very hard-working and great parliamentarians and I cannot imagine anyone saying because they are black and in the minority they should sit behind a wall.

Zacznij.biz competition reveals three finalists After two days and over 20 project presentations, the latest stage of the Zacznij.biz competition, organized by the Confederation “Lewiatan” and Lewiatan Business Angels, revealed three finalists.

The projects were selected by a jury in a panel of experts associated with Lewiatan Business Angels. The jury members were Szymon Kurzyca (LBA), Krzysztof Gawrysiak (Business angel), Jacek Aleksandrowicz (AIP Seed Capital), Aniela Hejnowska (Groupon Polska) and Maciej Strzębicki (Tomorrow Consulting). nut s for a Q&A nutes Each of the contestants had 15 minutes to present their business idea, and a further 15 minutes ainl inly bec ccause e each session. Jury members admitted that selecting the finalists was a very difficult task mainly because project was in a different industry. The jury’s assessment was done according to how app appealing ppealing th the he pr h projects rojects would be to investors.

LBA will be in charge of preparing the finalists decided stts for the Gala. Apart from the finalists, nal nalists, the jury also d de ecided to w ell as the chosen semi-finalists alis will have the oppor alists rtunity to reward nine semi-finalists. The finalistss as we well opportunity al stand at the Gala. showcase their ideas at a promotional nt ntial investor rs during ing the Competition Finale Gala wh hich will h The finalists will present their projects to potential investors which e Centre in n Warsaw.

Wars arsaw. The winners of the competition n will be take place on May 23 in the Copernicus Science selected in a live voting by the guests attending tthe Final Finale le Gala.

G Among the voters there will be business bu usiness u vventurists rists ists as well as Jury of Honor comprising lead ders of d angels associated with Lewiatan Business Angels, venturis leaders pp port orting ing en e trepreneu eursh rship ip and innovativeness. both private and state organizations specializing in ssupp supporting entrepreneurship The finalists in the Zacznij.biz competition: ‘Anshar Studios - SDU: Division Alpha’ This business concept is to develop a start-up company specialised pecia pecialised sed in producing advanced strategy stra rate tegy vvideo games which will be distributed on mobile devices (iOS, Android, Windows Anshar d, Wi Window W ndows 8) and on PCs. Ansh sha ar Studios' Stu up-and-coming product will be called “SDU: Division Alpha” and will be targeting e target targ rgeti eting ng cor core e players. p ‘Innovative REHACT Energy System (RES)’ An innovative combination of ventilation, cooling and heating in one economical system. system built m m. T The sys Th ystem is b around REHACT Ventilation Unit exchanger, which maximizes the heat efficiency in a building. ding. The Th he exchanger exchang gives the buiding's residents great comfort as well as utilizes the building's heat to significantly energy ficantlyy lower ener consumption necessary for its ventilation, heating and cooling.

‘A diabetic mug’ A start-up offering an innovative solution for diabetics on strict diabetic diet. It allows them not only or ly to eat o drink a wide range of foodstuffs with varying carbohydrate content but also to find their carbohydrate hydratt equivalents quickly and easily.

And there are far fewer black people than homosexuals in Poland. So if we were to be seated according to our numbers in society ...

Exactly, it would be a scandal if someone were to say that.

But in the case of homosexuals, people seem to feel they should be able to say anything.

And then when we react, they say we are a “homo-lobby” trying to clamp down on freedom of speech, that we are privileged sacred cows. This is dangerous because it builds up hatred towards us.

A strong, privileged group that has money and influence, “just like the Jews,” some might say.

I am happy you noticed that parallel between gays and Jews. It is very visible. Today, there are very few Jews in Poland, so we can’t blame them for everything, that is not tolerated any more. But it is very easy to blame homosexuals for all the deprivation in Poland because society tolerates that.

That is dangerous, because if people hear that there is a “homo-lobby” holding Poland hostage and demoralizing society then one day somebody will pick up a stone and decide to do something about it.

On a personal note, how was it for you when you discovered

www.wbj.pl

you were gay? What kind of thoughts did you wrestle with?

I felt like a UFO when I discovered I was gay. I felt alone in the world. I was brought up in Bieszczady, in Poland’s southeast, a very conservative region. And it was unthinkable there that someone like me could exist.

When I started discovering my sexuality, as a teenager, I was terrified because I did not have any positive role models. I knew only that there were words like faggot, pansy, vulgar expressions.

Back then the word “gay” was not used in Poland. I also heard terrible jokes about homosexuals.

How did you feel when you heard them?

Terrible. The worst. I simply felt then that I must do everything to hide my homosexuality so that no one found out. In fact I felt the best thing for me would be to simply not exist.

That is why many gays and lesbians commit suicide.

I tried committing suicide myself. You know, when the whole world is different from you and you feel alone and hear that you are a faggot, a pansy, what else can you think?

In school when my friends played soccer, the goalkeeper who let in a goal was called a faggot. A faggot was the worst thing a boy could be and I did

13

not want to be the worst thing.

That’s why I had to leave the place I grew up in.

But it is a little bit easier for gays in Poland now is it not?

Yes, things are changing.

When I was growing up, there were no high-profile comingouts, but now there are.

When did you think, “Wait a minute, maybe I am not so worthless after all?”

It was a process. It’s not like you wake up one day and think “Oh I am gay and strong, everybody knows and everything will be great.” No. It is a long process and a difficult one. Even now, when strolling on the street with my partner, I don’t dare hold his hand even when I really want to. I am scared to do it.

But I would never go back to being in the closet. I have friends who are MPs and haven’t come out yet. Their lives are terrible. A male MP refers to his male partner as “she” in public or even pretends he doesn’t have a partner at all, as if that person simply did not exist.

They have to watch their every step, maintain self-control at all times to make sure nobody guesses the truth. And they also feel the need to try and “prove” their heterosexuality at all times. Thank goodness I don’t have to do all that any more. ●

14

FINANCE & ECONOMICS

www.wbj.pl

MAY 13-19, 2013

Interest rates

RPP cuts rates again to new record low The council said that negative economic data both domestically and abroad were key in the decision The National Bank of Poland’s Monetary Policy Council (RPP) cut its benchmark interest rate by 25 basis points to a new record low of 3.00 percent last week. After entering a

well as signs of a slowdown in Europe, and especially in Germany. In view of the worsening conditions in Europe, the European Central Bank cut its main interest rate by 25 basis points in early May, to 0.50 percent.

In its statement, the RPP also cited Poland’s sluggish growth in the fourth quarter of last year, as well as slow construction output and retail

wait-and-see mode after a 50bp cut in March, the members of the council had apparently waited long enough and seen enough bad economic figures to convince them to cut rates again.

In a statement released following the decision, the RPP cited a sluggish global economy, including slowing growth in China, worse consumer sentiment in the US as

Cut, cut, cut The National Bank of Poland’s benchmark interest rate, May 2011-May 2013 5.000

4.375

3.750

Apr. ’13

May ’13

Mar. ’13

Jan. ’13

Feb. ’13

Dec. ’12

Oct. ’12

Nov. ’12

Sep. ’12

Jul. ’12

Aug. ’12

Jun. ’12

May ’12

Apr. ’12

Mar. ’12

Jan. ’12

Feb. ’12

Dec. ’11

Oct. ’11

Nov. ’11

Sep. ’11

Jul. ’11

Aug. ’11

Jun. ’11

2.500

May ’11

3.125

Source: The National Bank of Poland

The RPP’s target inflation rate is 2.5 percent, with a range of plus or minus one percentage point. Inflation has come in below that range for the past two months. In March, inflation was just 1 percent year-on-year.

sales, which it said showed reduced economic activity.

In April, Poland’s statistics office revised its initial calculation for GDP growth in the fourth quarter of 2012 downward from 1.1 percent to 0.7 percent. Retail sales grew a mere 0.1 percent year-on-year in March, while construction output continued its free fall, dropping by over 18 percent y/y in the same month.

“In the council’s view, the incoming data point to continued low economic growth in Poland as well as a stronger drop in inflation than was predicted in the [NBP’s] March projection,” the RPP wrote.

“At the same time, uncertainty surrounding the tempo and momentum of the expected recovery in the euro zone has grown, which could negatively impact economic activity in Poland. As a result, the risk of continued inflation well below the target in the medium term has increased.”

so how many.

Economists at Danske Bank called the rate cut “quite obvious.”

“If we look at the sluggish performance of the Polish economy and falling inflation, which is now well below the NBP’s inflation target of 2.5 percent, the Polish central bank needed to take action to fight the disinflationary trend and weak growth,” they wrote in an e-mailed comment.

“Looking ahead, we believe the NBP is far from done with cutting interest rates. We expect it to deliver yet another 25bp, perhaps as early as June or July, before it takes a pause for the summer.

Another 25bp cut could come in September. Overall, the NBP has plenty of room to maneuver given that inflation is ... expected to fall further in coming months, perhaps as low as half a percentage point.”

‘Unexpected?’

Surveys had shown that most economists expected the RPP, whose decisions have recently been difficult to predict, would keep rates on hold. The RPP held on rates late last year when some economists thought it should have cut, while the 50bp cut in March caught many off guard. Interviews with council members in the media recently had shown a split, with some wanting to wait until a new inflation forecast came out in July.

But several economists had expected the move as well, and the question will be whether more cuts are in store – and if

Andrew Kureth

Manufacturing PMI tanks as sector sees steep slowdown expectations inflation will keep up pressure for further interest rate cuts,” she added.

The Monetary Policy Council cut its benchmark interest rate last week by 25 basis points, in

part because of the slowerthan-expected recovery in AK Poland.

Steep drop Poland’s manufacturing PMI index reading, January 2012-April 2013 (a reading above 50 indicates expansion, below 50 indicates contraction) 53 52 51

Source: Markit/HSBC

50 49 48 47

NETWORKING INSPIRACJE

ZAREJESTRUJ SIĘ

KONFERENCJA PRCH RETAIL HORIZONS

12 czerwca 2013, Stadion Narodowy, Warszawa

Shopping Centres of the Future Why shopping will never be the same

ORGANIZATOR

SPONSORZY I PARTNERZY

www.prch.org.pl

e-mail: prch@prch.org.pl

tel.: +48 22 629 23 81

3 r. ’ 1

3

EDUKACJA

Ap

3

3

Ma r. ’ 1

Feb . ’1

2

’12

. ’1 Jan

c.

De

12

v. ’ 1 No

t. ’ Oc

’12

2 . ’1

p.

Se

2

Au g

. ’1 Jul

2 . ’1

2 y ’1

Jun

2 Ma

2 r. ’ 1

Ap r. ’ 1

2 Ma

. ’1

2

46

. ’1

orders also fell, albeit at a slightly weaker rate than in March. New business from export markets has risen only once in the past 23 months.”

Commenting on the survey, Agata Urbaƒska, an economist for Central and Eastern Europe at HSBC called the figures a “significant disappointment,” and added that with German PMI readings also lower, the outlook for exports – and hence Poland’s manufacturing sector – were not good.

“Weak activity data and weak leading activity indicators matched with below-

Feb

in below 50 for 13 straight months now.

Business conditions deteriorated on the back of sharper declines in output and new orders, according to Markit and HSBC. “Input and output prices both fell markedly, with the rate of reduction in the latter hitting a new survey record,” the report read.

It continued, “The volume of new orders declined in April, continuing the trend shown since February 2012.

The rate of contraction accelerated for the second consecutive month, to the fastest since last September. New export

Jan

The downturn in Poland’s manufacturing sector was much steeper than expected in April, reaching its worst contraction since July of 2009, according to the latest Purchasing Managers’ Index (PMI) data from Markit and HSBC. The reading came in at 46.9 points for last month, a significant decline from the 48.0 reached in April and worse than market expectations for only a slight drop. Any number below 50 signals contraction, while any number above 50 indicates expansion. Poland’s manufacturing PMI has come

OPINION & ANALYSIS

MAY 13-19, 2013

www.wbj.pl

15

Europe’s irrelevant austerity debate Daniel Gros

T

he most visible symptom of the crisis in the euro zone has been the high and variable risk premiums that its peripheral countries now must pay on their public debt. Moreover, an influential paper by the American economists Carmen Reinhart and Kenneth Rogoff suggests that economic growth falls sharply when a country’s public debt rises above 90 percent of GDP. So the policy prescription for solving the crisis seems simple: austerity. Fiscal deficits must be cut to reduce debt levels.

But the debate about austerity and the cost of high public-debt levels misses a key point: Public debt owed to foreigners is different from debt owed to residents. Foreigners cannot vote for the higher taxes or lower expenditure needed to service the debt. Moreover, in the case of domestic debt, a higher interest rate or risk premium merely leads to more redistribution within the country (from taxpayers to bondholders). By contrast, in the case of debt owed to foreigners, higher interest rates lead to a welfare loss for the country as a whole, because the government must transfer resources abroad, which usually requires a combination of exchange-rate depreciation and a reduction in domestic expenditure.

This distinction between foreign and domestic debt is

particularly important in the context of the euro crisis, because euro zone countries cannot devalue to increase exports if this is required to service foreign debt. And the evidence confirms that the euro crisis is not really about sovereign debt, but about foreign debt.

Key variable Indeed, only those countries that were running large current-account deficits before the crisis were affected by it. The case of Belgium

is particularly instructive, because the risk premium on Belgian sovereign debt has remained modest throughout most of the euro crisis, although the country’s debt-toGDP ratio is above the euro zone average, at around 100 percent, and it went without a government for more than a year.

An even starker example of the crucial difference between foreign and domestic debt is provided by Japan, which has by far the highest debt-to-GDP ratio among OECD

countries. So far, the country has not experienced a debt crisis, and interest rates remain exceptionally low, at around 1 percent. The reason is obvious: Japan has run sizable current-account surpluses for decades, giving it more than sufficient domestic savings to absorb all of its public debt at home.

What does this imply for Europe’s austerity debate? If foreign debt matters more than public debt, the key variable requiring adjustment is the external deficit, not the fiscal deficit. A country that has a balanced current account does not need any additional foreign capital. That is why risk premiums are continuing to fall in the euro zone, despite high political uncertainty in Italy and continuing large fiscal deficits elsewhere.

The peripheral countries’ external deficits are falling rapidly, thus diminishing the need for foreign financing.

Enlightening Italy The debate about austerity and the high cost of public debt is thus

misleading on two accounts. First, it has often been pointed out that austerity can be self-defeating, because a reduction in the fiscal deficit can lead in the short run to an increase in the debt-to-GDP ratio if both the debt level and the multiplier are large.

But austerity can never be self-defeating for the external adjustment. On the contrary, the larger the fall in domestic demand in response to a cut in government expenditure, the more imports will fall and the stronger the improvement in the current account – and thus ultimately the reduction in the risk premium –

SHUTTERSTOCK

“If foreign debt matters more than public debt, the key variable requiring adjustment is the external deficit, not the fiscal deficit.”

will be.

Italy’s experience is enlightening: the large tax increases implemented by former Prime Minister Mario Monti’s technocratic government in 2012 had a higher-than-expected impact on demand. The economy is contracting so much that the debtto-GDP ratio is actually increasing, and the actual deficit is improving only marginally, because government revenues are falling along with GDP. But a side effect of the fall in GDP is a strong decline in imports – and thus a strong improvement in the current account, which is why the risk premium continues to fall, despite the political turmoil unleashed by the country’s inconclusive recent election.

Second, if foreign debt is the real problem, the escalating debate about the Reinhart/Rogoff results is irrelevant for the euro crisis. Countries that have their own currency, like the United Kingdom – and especially the United States, which can borrow from foreigners in dollars – do not face a direct financing constraint.

For these

countries, it matters whether history suggests that there is a strong threshold effect once public debt exceeds 90 percent of GDP. But the euro zone’s peripheral countries simply did not have a choice: they had to reduce their deficits, because the foreign capital on which their economies were so dependent was no longer available.

But the reverse is also true: as soon as the current account swings to surplus, the pressure from financial markets abates. This is likely to happen soon. At this point, peripheral countries will regain their fiscal sovereignty – and will be able to ignore Reinhart and Rogoff’s warning at their own risk. ● Daniel Gros is director of the Center for European Policy Studies.

Copyright: Project Syndicate, 2013.

Project-syndicate.org

Editorials are the opinions of WBJ’s editorial board. Other opinions are those of the authors alone. Comments, opinions and letters should be sent to editor@wbj.pl. Please include a name and contact information and clearly indicate if they are to be considered for publication.

PUBLISHER VALKEA MEDIA SA MANAGING EDITORS

REAL ESTATE EDITOR

JACEK CIESNOWSKI (JCIESNOWSKI@WBJ.PL) BEATA SOCHA (BSOCHA@WBJ.PL)

KAROLINA KOWALSKA (KKOWALSKA@WBJ.PL)

ADAM NARCZEWSKI ANDREW NAWROCKI

MARKETING &SALES

REPORTER

INTERN

MARKETING &SALES DIRECTOR

POLITICS EDITOR

E. BLAKE BERRY EWA BONIECKA DAVID INGHAM ALEKSANDRA S¸ABISZ ALEX ZARGANIS

REMI ADEKOYA (RADEKOYA@WBJ.PL)

KAMILA WAJSZCZUK CONTRIBUTORS

COLUMNISTS

EDITOR-IN-CHIEF ANDREW KURETH (AKURETH@WBJ.PL)

AGNIESZKA BREJWO

MARTA MARDOSZ

(ABREJWO@WBJ.PL)

PRODUCTION MANAGER

MAGDALENA KARPI¡SKA (MKARPINSKA@WBJ.PL)

PIOTR WYSKOK

GRAPHIC DESIGNER

¸UKASZ MAZUREK

MANAGING DIRECTOR MONIKA STAWICKA

EWA BROGOSZ-KORYCKA (EBROGOSZ-KORYCKA@WBJ.PL)

PRINT & DISTRIBUTION COORDINATOR

KRZYSZTOF WILI¡SKI (DYSTRYBUCJA@VALKEA.COM)

PR & MARKETING MANAGER

KATARZYNA MAREK (KMAREK@WBJ.PL)

BOOK OF LISTS COORDINATOR

MONIKA BRYSIAK (MBRYSIAK@VALKEA.COM)

SUBSCRIPTIONS MANAGER

AGNIESZKA KUCZY¡SKA (AKUCZYNSKA@WBJ.PL)

AGNIESZKA MICHALIK (AMICHALIK@VALKEA.COM)

Prenumerata realizowana przez RUCH S.A: Zamówienia na prenumerat´ w wersji papierowej i na e-wydania mo˝na sk∏adaç bezpoÊrednio na stronie www.prenumerata.ruch.com.pl Ewentualne pytania prosimy kierowaç na adres e-mail: prenumerata@ruch.com.pl lub kontaktujàc si´ z Telefonicznym Biurem Obs∏ugi Klienta pod numerem: 801 800 803 lub 22 717 59 59 – czynne w godzinach 700 – 1800. Koszt po∏àczenia wg taryfy operatora.

As supply increases, demand for offices in Warsaw is holding strong

Colliers examines the effect of the Cyprus crisis on the CEE real estate market

17

18

LOKALE IMMOBILIA

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

Art exhibition in Warsaw Trade Tower An art exhibition entitled “Bright Spring,” showcasing works by young artists from the Academy of Fine Arts in Warsaw, will be held in the lobby of Warsaw Trade Tower from May 13 to June 6. The office building’s employees will vote for the top five paintings, which will be bought by the organizer after the exhibition and will serve as permanent decorations of the building’s lobby. Some z∏.40,000 has been allocated for this purchase. The originator of the exhibition is Heitman, a real estate investment management company.

The 43-storey, 42,700sqm office building is located on ul. Ch∏odna 51 in the capital’s city center. ●

In this issue Gdynia Waterfront . . . . . . . . . . . . .16 Galeria Solna . . . . . . . . . . . . . . . . . . .16 Office market in Q1 . . . . . . . . . . . .17 Shopping centers . . . . . . . . . . . . . .17 Colliers on Cyprus and CEE RE . .18

SwedeCenter builds on Gdynia’s waterfront The developer will bring two modern buildings to Gdynia’s coastline by mid-2015 Real estate developer and investor SwedeCenter has recently launched construction on the first phase of its mixed-use project on ul.

Nabrze˝e Prezydenta in Gdynia, on the Baltic coast. When completed, Gdynia Waterfront, located on a 3.6-ha plot, will deliver a total of 90,000 sqm of office, commercial and residential space near the city’s Skwer KoÊciuszki square.

The first phase of the scheme, construction on which has just recently begun, will consist of an 11-storey, 11,500-sqm office building and a nine-storey Marriott Courtyard hotel with 201 rooms and a 650-sqm conference center.

The office building, which was designed in accordance with LEED sustainable devel-

opment certificate requirements, will house stores and boutiques on its ground floor, along a sidewalk joining Sea Towers residential complex with Al. Jana Paw∏a II. Porr Polska was chosen as the general contractor of the first phase of Gdynia Waterfront, scheduled for completion in mid-2015.

“We have been preparing to launch the investment for a few years now and we were very happy to receive the building permit,” Roger Andersson, managing director of SwedeCenter, said in a statement. He added that the complex would be developed in a well-known and prestigious part of Gdynia, noting that the scheme was designed to benefit from its proximity to the sea. The first phase of the investment will also neighbor the Gemini shopping mall.

Established in 1992, SwedeCenter is part of the Inter IKEA Group. The com-

Once completed in 2015, the complex will deliver 90,000 sqm of office, commercial and residential space pany is currently involved in commercial projects in

Poland including Business Garden parks in Warsaw, Poz-

naƒ and Wroc∏aw.

Karolina Kowalska

Retail

Galeria Solna opens in Inowroc∏aw The city’s first modern shopping center opened for business last Wednesday, offering 31,000 sqm of retail space ACE 1, a joint venture formed

by Acteeum Central Europe and Libra Project, opened its Galeria Solna project in Inowroc∏aw, a city in northcentral Poland, after only 11 months of construction work.

According to the investor, approximately 200,000 people live within a 30-kilometer radius of the mall.

Developed on 10 hectares of land and featuring 31,000 sqm of leasable space, the onestorey investment is the first modern shopping center in the

city, located in the KujawskoPomorskie voivodship, with a population of some 76,000.

The financing for the project was secured from bank Pekao.

Anchored by a Tesco hypermarket and a Nomi DIY store, the shopping center houses approximately 100 other retail units, among which are H&M, Reserved, Smyk, Stradivarius, Apart, Empik, Martes Sport, Rossmann, Home&You and Avans. The food court features a Grycan ice-cream parlor, a Nasz NaleÊnik pancake bar, as well as a Ró˝a, Fio∏ki i Anio∏ki restaurant. The parking lot contains 1,000 spaces.

“We are really proud to have been able to build a shopping center in only 11 months and to get the best

tenants, whose merchandise will be attractive to the clients,” said Tomasz Szewczyk, CEO at ACE 1. “We were also able to get a BREEM certificate of sustainability for the building, designed in accordance with the highest environmentfriendly standards,” Mr Szewczyk added.

Acteeum Central Europe is currently expanding two retail projects from CBRE Global Investors’ portfolio – Sarni Stok in Bielsko-Bia∏a and Ogrody in Elblàg. The majority shareholder of Libra Project is Dariusz Mi∏ek, the founder of CCC footwear retailer, whose Galeria Korona Kielce mall in Kielce opened last year.

Karolina Kowalska

COURTESY OF DTZ

Global management consulting, technology services and outsourcing company Accenture leased 1,700 sqm of office space in University Business Park (UBP) in ¸ódê for its new BPO center. The building comprises 18,423 sqm GLA and 300 parking spaces. The other tenants in the investment include: Citi, HP, Samsung, Mobica and Warta, Samsung, Intergraph, Kredyt Bank, Hermann Kirchner, Bankruptcy Management Solutions, Tax Care and Pharmena.

Office/hospitality

COURTESY OF SWEDECENTER

Accenture in UBP in ¸ódê

MAY 13-19, 2013, LI 18/18

Some 300,000 people live in the catchment area of Inowroc∏aw’s first shopping mall

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

MAY 13-19, 2013

Office

Warsaw office demand still strong as supply grows New completions will put total office supply in Warsaw above 4 million sqm in 2013, with higher vacancy rates putting downward pressure on rents

Schneider (7,000 sqm in Park Rozwoju in Warsaw’s southern district of Mokotów). The largest renewals – both in Mokotów – were registered by bank BNP Paribas (11,000 sqm in Trinity Park II) and by telecom operator Play (9,600 sqm in Marynarska BP, which also included an expansion of the space Play already occupies there).

Office demand in Warsaw remains strong, with 98,700 sqm net demand (excluding renewals) and 155,500 sqm gross demand registered in Q1, which accounted for an increase of 16 percent and 24 percent respectively year-on-year, according to a recent report from Jones Lang LaSalle. Prelease activity remains strong, representing some 30 percent of the Q1 net demand.

The largest new transactions were pre-leases/presales, including the owner occupation transaction by security firm Konsalnet (8,200 sqm) and the pre-lease by energy distribution company

vacancy up further to 9.9 percent at the end of Q1 2013, of which 9.6 percent was in central areas and 10 percent in non-central districts. The high vacancy rate is putting rents under downward pressure.

Prime headline rents have been revised slightly downward over the quarter in Warsaw’s central districts to €2224.5/sqm/month. The best non-central locations, such as prime buildings in Mokotów, are fetching €15/sqm/month.

“This year, we have been noticing a relatively large demand for office space from tenants,” Tomasz Czuba, head of office leasing at Jones Lang LaSalle said. “On the other hand, the total volume of new completions in Warsaw is forecast to peak in 2013, with a total annual amount of approximately 308,000 sqm.

By the end of this year, Warsaw will hit the 4 million sqm mark in modern office space supply,” Mr Czuba added.

Mokotów hits 1 million sqm In Q1, 72,600 sqm of office space was completed in the capital of Poland and in Q2Q4 238,000 sqm is expected to be delivered, predominantly on a non-speculative basis.

Developers’ activity has slightly decreased y/y but remains at a relatively high level with 576,000 sqm under construction. Notably, the total office stock in the Mokotów district exceeded 1 million sqm in Q1.

The high construction activity in Warsaw pushed

Office market in Poland Warsaw

Kraków

Wroc∏aw

Tri-city Katowice

Poznaƒ

¸ódê

Szczecin

Lublin

3,935,250

551,400

501,900

409,150

296,100

292,950

248,800

108,800

90,500

76,200

1,800

39,200

31,600

6,150

2,400

0

16,900

0

Under construction (sqm) 581,000

96,700

67,450

80,800

40,450

66,800

45,100

11,500

19,000

9.9

4.2

9.7

13.7

10

16.7

11.7

19.7

2.6

➔

➔

➔

➔

➔

➔

➔

➔

An overview of major Polish cities in Q1 2013

➔

Total stock (sqm) Completions (sqm)

Vacancy rate (percent) Change in vacancy rates

Occupier activity highest in southern Poland As to the other major office cities in Poland, almost 100,000 sqm was leased in Q1 2013, up 7 percent compared to the previous quarter (the net take-up of 79,300 sqm was up by 3 percent compared to Q4 2012), with Kraków, Wroc∏aw and Katowice clearly leading in occupier activity.

Almost 40 percent of all deals signed in Q1 2013 were pre-leases, with the largest being financial conglomerate Getin Holding (about 12,000 sqm in Sky Tower in Wroc∏aw), Nearly 100,000 sqm of new office space was delivered to the market outside Warsaw, of which 40 percent was in Wroc∏aw and 32 percent in Tri-city.

This quarter Wroc∏aw joined Kraków in terms of modern office stock exceeding 500,000 sqm.

Quarterly vacancy rates remained stable in Katowice, Kraków and Wroc∏aw, and even decreased slightly in ¸odê (11.7 percent versus 13.7 percent in Q4 2012).

Other major regional office markets in Poland have recorded an increase in vacancy levels. Prime headline rents currently range from €11/sqm/month in Lublin and ¸ódê, to €16/sqm/month in Poznaƒ.

KEK

Source: Jones Lang LaSalle

Retail

More malls expected this year 900,000 sqm of shopping center space is currently under construction in Poland

COURTESY OF NEINVER

With shopping center stock totaling 9.48 million sqm in 416 schemes in Poland at the end of Q1 2013, there is currently over 900,000 sqm of shopping center space under construction, according to CBRE. This number includes typical shopping centers as well as specialized shopping formats, including

retail parks and factory outlets.

With 240 sqm of GLA per 1,000 residents and gradually improving high streets, the modern retail network in Poland has become increasingly mature while still offering further, though increasingly selective, development potential, CBRE experts say in the advisory’s most recent report on the subject.

The largest projects under construction are Neinver’s Galeria Katowicka and the

Galeria Katowicka

Wzgórze extension in Gdynia developed by Foncière Euris, as well as Auchan’s new retail gallery extension in ¸omianki, near Warsaw.

In Poland more and more specialized schemes are being developed, such as factory outlets and retail parks. There is increasing development of neighborhood shopping centers, as well as high street redevelopment. According to experts from CBRE, the next few years will see increased presence of multifunctional centers with strong entertainment elements, such as Galeria Rzeszów, which opened in November 2012. The coming years will also feature the redevelopment of historical and post-industrial sites into modern schemes, such as Outlet Park Szczecin, which was built in a former warehouse hall.

“Economic drivers for further retail market development in Poland are easing, said Mag-

dalena Fràtczak, director of retail at CBRE in Poland.

“Consumer demand, so resilient in comparison to other European economies during the first slowdown between 2009 and 2011, is now decelerating. With tenant’s demand clearly easing, and overall vacancy rates on the increase, the Polish shopping center market is entering the challenging times of a tenants’ market, when landlords will be forced to campaign actively in order to attract new retailers,” Ms Fràtczak added.

Across Europe, shopping center development in 2012 increased by 10 percent yearon-year to 1.71 million sqm, with a large proportion of that (72 percent) in Eastern Europe.

Istanbul was the most active European development market last year, with the opening of seven new centers. Europe’s other highly active market is KEK Russia.

www.wbj.pl

17

18

www.wbj.pl

LOKALE IMMOBILIA – REAL ESTATE

MAY 13-19, 2013

Expert view

The €10 billion bailout deal hammered with the European Union and the International Monetary Fund, saved Tony Pinnell, director of property Cyprus but not without finance at Colliers the introduction of capital controls. Colliers International’s The Cyprus Debate examined the wider ramifications of the Cypriot drama on real estate and CEE investment markets. The findings suggest that while the impact on Central and Eastern European (CEE) real estate is limited, global political momentum is building for greater transparency and low-tax domiciles are facing far more scrutiny.

Key findings of the debate include: CEE has emerged relatively unscathed. Many informed investors were warned about the state of Cypriot banks long before the crisis unfolded. Reduced lending capacity due to the nationalisation of the Bank of Cyprus and the closure of Laiki Bank has had little impact on markets in CEE. The impact on the operational

capacity of Cypriot SPVs is limited and there is no evidence of owners shifting to alternative domiciles, essentially as decisions about tax domicile are fixed years before the returns on investment activity are ever known.

A bail-in model is replacing the bail-out version. The era of private profits and socialized losses may be over. As wealthy nations struggle to maintain their own fiscal health there is no longer political tolerance of, nor pity towards, nations who seek to maintain the status quo. The ECB’s Mario Draghi and top euro zone finance minister Jeroen Dijsselbloem, have sent stern messages to countries with outsized banking sectors: Sort yourselves out as there may be no help if you get into trouble.

Individual taxpayers and low tax jurisdictions will face greater scrutiny. Luxembourg is not Cyprus is not Malta – but in each country the volume of banking deposits to the size of its economy is excessive. The EU is under increasing pressure from member states and populations to reform banking secrecy rules, improve bilateral cooperation between tax authorities, and cast light into low tax jurisdictions. Luxembourg and other locations will have to resign themselves to increased scrutiny, which may dilute their reputation as suitable domiciles

SHUTTERSTOCK

Will CEE markets escape Cyprus debacle?

How has the Cyprus crisis affected CEE real estate markets for investment vehicles.

Expect more amendments of bilateral tax treaties with offshore domiciles. Russia and Poland have already amended their bilateral double tax treaties with Cyprus with respect to tax treatment of “offshore vehicles.”

Looking forward, Damian Harrington, regional director, research & consulting, on Colliers’ Eastern Europe regional team concludes: “Given the number of CEE assets held in SPVs in both Cyprus and Luxembourg, we can expect more taxation at source, which may impact how

property deals are priced in future.

The impact may be marginal but will depend on structure/domicile involved for a particular transaction.

Investors and lenders will be following events in Luxembourg quite closely, probably more worried about any potential new disclosure rules than the amount of tax they pay.”

In the end, participants came to the conclusion that while Cyprus’s reputation has been tarnished by recent events, investors in Polish commercial real estate have not experienced any real disruption following

events in Cyprus. The political consensus for increasing scrutiny of low tax jurisdictions such as Cyprus and Luxembourg, is more about governments maximizing domestic tax receipts and the primary target in that debate are the super-rich or some of the world’s largest Public traded companies. Taxation alone will not influence whether or not an investor buys commercial real estate in Poland.

Poland’s tax rate is attractive and marginal tax differences at holding company level are not what drives investment rationale. ●

THE LIST

MAY 13-19, 2013

www.wbj.pl

19

Economy & Industry

Wind Farms Ranked by generation capacity A guide to Polish business and industry

www.bookoflists.pl

Przewodnik po polskim biznesie i gospodarce

Wind Farm Name Location (Municipality, Voivodship)

Investor

Generation capacity (MW)

Turbine power (MW)

Number of turbines

Turbine type

Turbine producer

Year opened

EDP Renewables

120.0

2.0

60

G90

Gamesa

2010

KarÊcino Mo∏towo/KarÊcino, Zachodniopomorskie

Iberdrola

90.0

1.5

60

FL1500

Fuhrländer

2008

Dar∏owo Wiekowice/Je˝yce/Dobies∏aw, Zachodniopomorskie

Invenergy

80.0

2.5

32

2.5xl

GE Energy

2012

˚uromin Kuczbork-Osada/˚uromin/Lubowidz, Mazowieckie

PGE

60.0

2.0

30

G90

Gamesa

2012

Wielkopolska Kleszczewo/Kostrzyn/Nekla, Wielkopolskie

E.ON

52.5

2.5

21

GE 2.5

GE Energy

2010

Karcino Karcino, Zachodniopomorskie

Dong

51.0

3.0

17

V90

Vestas

2010

Pàgów Pàgów, Opolskie

GDF Suez

51.0

3.0

17

V112

Vestas

2012

Tychowo Tychowo, Zachodniopomorskie

RP Global

50.0

2.5

20

N90

Nordex

2009

Tymieƒ Tymieƒ, koszaliƒski, Zachodniopomorskie

Invenergy

50.0

2.0

25

V 80

Vestas

2006

Go∏dap/Wronki Wronki, Warmiƒsko-Mazurskie

Vortex

48.0

3.0

16

V90

Vestas

2009

Korsze Korsze, Warmiƒsko-Mazurskie

EDP Renewables

48.0

2.3

21

G90

Gamesa

2011

PGE

48.0

2.0

24

G90

Gamesa

2012

Mitsui i J. Power

48.0

2.0

24

V89

Vestas

2008

PGE EO

48.0

2.0

24

G90

Gamesa

2012

Taiga Mistral

41.4

2.3

18

SWT-2.3-93

Siemens

2011

RWE Renewables Polska

41.4

2.3

18

SWT-2.3-93

Siemens

2009

Kisielice ¸odygowo, Warmiƒsko-Mazurskie

Iberdrola

40.5

1.5

27

1.5

GE Energy

2007

Golice Golice, Lubuskie

Acciona

38.0

2.0

19

G90

Gamesa

2011

Tychowo Tychowo, Zachodniopomorskie

RWE Renewables Polska

34.5

2.3

15

SWT-2.3-93

Siemens

2011

Dobrzyƒ Dobrzyƒ, Kujawsko-Pomorskie

Vortex

34.0

2.0

17

V90

Vestas

2010

PEP

34.0

2.0

17

V90

Vestas

2012

Mogilno Mogilno/Olsza, Kujawsko-Pomorskie

Vortex

34.0

2.0

17

V90

Vestas

2009

Inowroc∏aw Inowroc∏aw, Kujawsko-Pomorskie

Vortex

32.0

2.0

16

V90

Vestas

2009

RWE Renewables Polska

32.0

2.0

16

G90

Gamesa

2011

Âniatowo Âniatowo, Zachodniopomorskie

Vortex

32.0

2.0

16

V90

Vestas

2010

Lipniki/Kamiennik Lipniki, Opolskie

Tauron

30.8

2.1

15

MM92

REpower

2011

Jagniàtkowo (Lake Ostrowo) Jagniàtkowo, Zachodniopomorskie

Dong

30.6

1.8

17

V 90

Vestas

2007

Kamieƒsk Kamieƒsk/Góra Kamieƒska, ¸ódzkie

PGE

30.0

2.0

15

E - 70 E4

Enercon

2003

GDF Suez

30.0

2.0

15

WND

REpower

2011

Zagórze/Wolin Zagórze, Zachodniopomorskie

Tauron

30.0

2.0

15

V80

Vestas

2003

Kamionka Bielin/Mieszkowice/Kamionka, Zachodniopomorskie

Cibet

30.0

2.5

12

WND

WND

2012

Taciewo Taciewo, Podlaskie

RWE

30.0

2.0

15

G90

Gamesa

WND

Karnice/Skrobotowo Skrobotowo/Kusin, Zachodniopomorskie

Dong

29.9

2.3

13

SWT-2.3-93

Siemens

2010

Modlikowice Modlikowice, DolnoÊlàskie

PEP

24.0

2.0

12

V90

Vestas

2012

Iberdrola

24.0

2.0

12

G90

Gamesa

2011

Eolica

22.0

2.0

11

E82

Enercon

2010

Puck/Gnie˝d˝ewo Gnie˝d˝ewo, Pomorskie

PEP

22.0

2.0

11

G87

Gamesa

2007

Barzowice Barzowice, Zachodniopomorskie

E.ON

20.7

2.3

9

N90

Nordex

2011

Jargoniew/Mo∏towo Mo∏towo, Zachodniopomorskie

GDF Suez

20.0

2.0

10

WND

REpower

2011

Margonin Kowalewo/Lipiny/Margonin, Wielkopolskie

Pelplin Lignowy Szlacheckie/Pomyje/Janiszewko/Rudno/Pelpin, Pomorskie Zajàczkowo ¸osino/Wdzino/Sierakowo, Pomorskie Pelplin Pelplin, Pomorskie Kobylnica Lulemino, Pomorskie Suwa∏ki Potasznia/Bia∏a Woda/˚ywa Woda/Bród Stary, Podlaskie

¸ukaszów ¸ukaszów, DolnoÊlàskie

Piecki Piecki, Podlaskie

Wartkowo Wartkowo, Zachodniopomorskie

Bystra Bystra, Pomorskie Kisielice/¸´gowo II ¸´gowo/Klimy, Warmiƒsko-Mazurskie

Notes: Data for The List was provided by the Polish Wind Energy Association, www.psew.pl The List will be published in Book of Lists 2013. This Polish-English publication lists companies from 70 business sectors in Poland. Available from June.

Subscribe at: www.bookoflists.pl

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 22 257-7500, or via e-mail to wbjbol@wbj.pl. Copyright 2013, Valkea Media SA. The List may not be reprinted or reproduced in whole or in part without prior written permission of the publisher. Reprints are available.

20

MARKETS

www.wbj.pl

MAY 13-19, 2013

Stocks report

world stock indices DJIA

NASDAQ

15,082.62 (May 09 close)

S&P500

3,409.17 (May 09 close)

1.69% (for the week)

FTSE100

1,626.67 (May 09 close)

2.05% (for the week)

DAX

6,592.70 (May 09 close)

1.82% (for the week)

2.04% (for the week)

Big gains for the WIG

NIKKEI 8,262.55 (May 09 close)

14,191.48 (May 09 close)

3.78% (for the week)

3.63% (for the week)

CHANGE: 12.45% (year to May 09)

CHANGE: 9.54% (year to May 09)

CHANGE: 11.23% (year to May 09)

CHANGE: 9.38% (year to May 09)

CHANGE: 6.22% (year to May 09)

CHANGE: 32.78% (year to May 09)

52-week high: 15,144.83

52-week high: 3,428.50

52-week high: 1,635.01

52-week high: 6,634.91

52-week high: 8,274.18

52-week high: 14,421.38

52-week low: 12,035.09

52-week low: 2,726.68

52-week low: 1,266.74

52-week low: 5,229.76

52-week low: 5,914.43

52-week low: 8,238.96

Andrew Nawrocki WBJ market analyst It was a strong week for most equity indices around Europe, with Polish blue chips seeing impressive gains throughout the week. With the Polish bourse being closed on Friday, May 3, Polish stocks played catch-up last Monday, reacting to strongerthan-expected non-farm payroll data released in the US. Shares of Synthos and Asseco saw the largest gains (by 4.9 percent and 3.8 percent respectively), with the broader WIG20 seeing a 1.44 percent rise. The WIG gained 1.25 percent.

Tuesday saw further gains in Warsaw, though compared to the rest of Europe, Polish stocks performed poorly.

Weighing the WIG20 down was news of stock manipulation concerning Boryszew, one of Poland’s largest diversified industrial groups.

Shares of the company fell by over 2 percent. The WIG20 closed 0.37 percent higher, with the WIG up nearly half a percent.

Major indices WIG20

2,348.95 (May 09 close)

Change year to May 09: -10.56%

09.05

08.05

07.05

06.05

02.05

30.04

29.04

26.04

25.04

24.04

52-week low: 2,035.8

19.04

18.04

52-week high: 2,628.36

17.04

09.04

09.05

08.05

07.05

06.05

02.05

30.04

29.04

26.04

25.04

2,200 24.04

43,000 23.04

2,260

22.04

43,600

19.04

2,320

18.04

44,200

17.04

2,380

15.04

44,800

12.04

2,440

11.04

45,400

10.04

2,500

09.04

46,000

15.04

52-week low: 36,653.28

12.04

Change year to May 09: -6.58%

11.04

Change for the week: 1.87%

10.04

52-week high: 48,222.72

23.04

44,943.16 (May 09 close)

Change for the week: 2.16%

22.04

WIG

Top 5 REGNON MISPOL MONNARI GREENECO WISTIL

Closing 0.02 2.20 4.64 1.01 13.00

% change (week) 52-week high 100.00 0.08 46.67 2.35 33.72 4.87 31.17 3.56 30.00 20.86

52-week low 0.01 0.70 0.71 0.60 8.10

Top 5 HANDLOWY PGNIG BRE GTC LOTOS

Closing 101.90 5.79 357.00 7.80 39.91

% change (week) 5.93 5.46 5.31 4.00 3.66

52-week high 103.80 6.10 359.40 10.25 45.45

52-week low 64.20 3.63 255.70 5.13 22.66

Bottom 5 SOBIESKI BIOTON EFH 4FUNMEDIA AGROTON

Closing 38.89 0.04 0.36 19.11 2.69

% change (week) -22.22 -20.00 -18.18 -16.91 -16.46

52-week low 36.06 0.03 0.34 12.14 1.13

Bottom 5 BORYSZEW JSW BOGDANKA KERNEL EUROCASH

Closing 0.41 79.30 116.00 57.04 57.50

% change (week) -8.89 -2.10 -0.85 -0.28 -0.24

52-week high 0.71 101.00 143.00 76.00 58.50

52-week low 0.40 78.53 114.00 47.25 36.59

52-week high 279.00 0.10 4.70 22.01 15.15

Wednesday saw further gains, after the National Bank of Poland cut its primary interest rate by 25 basis points. Good moods across Europe and especially overseas saw investors gobble up shares, after the DJIA closed the previous day over 15,000 points for the first time ever. Both the WIG and WIG20 saw their indices move up nearly 0.9 percent, with financials leading the way.

After seeing gains 3 days in a row, Polish shares had a slightly difficult time on Thursday, possibly resulting from weak Asian data. Strong US data did not help much late in the day, with the WIG20 closing 0.8 percent down.

On Friday stocks were lower as well. The WIG ended 0.11 percent down and the WIG20 0.46 percent in the red, after the EBRD lowered its 2013 GDP growth forecast for Poland from 1.5 percent to 1.2 percent. ●

Other indices sWIG80 Change for the week: 1.52%

Change year to May 09: 2.39%

52-week low: 2,147.52

Change year to May 09: 1.74%

52-week low: 8,984.43

09.05

08.05

07.05

06.05

02.05

30.04

29.04

26.04

25.04

24.04

23.04

18.04

17.04

15.04

12.04

11.04

10.04

WIG-Banki

6,241.19 (May 09 close)

09.05

08.05

07.05

06.05

02.05

30.04

29.04

26.04

25.04

24.04

23.04

22.04

09.04

09.05

08.05

07.05

06.05

02.05

30.04

29.04

26.04

25.04

24.04

23.04

6,000

22.04

6,100

31.0

19.04

31.4

18.04

6,200

17.04

31.8

15.04

6,300

12.04

32.2

11.04

6,400

10.04

32.6

09.04

6,500

19.04

52-week low: 5,163.30

18.04

Change year to May 09: -7.17%

17.04

52-week low: 30.85

15.04

52-week high: 6,723.16

Change year to May 09: -5.06%

12.04

Change for the week: 2.16%

11.04

52-week high: 40.19

10.04

Change for the week: 0.38%

33.0

RPP cuts interest rates Adam Narczewski X-Trade Brokers DM SA

09.04

09.05

08.05

07.05

06.05

02.05

31.54 (May 09 close)

52-week high: 11,245.80

SOURCE: WSE

NewConnect

30.04

29.04

26.04

25.04

10,100 24.04

2,400

23.04

10,280

22.04

2,460

19.04

10,460

18.04

2,520

17.04

10,640

15.04

2,580

12.04

10,820

11.04

2,640

10.04

11,000

09.04

2,700

Currency report

10,714.80 (May 09 close)

52-week high: 2,718.31

22.04

2,630.10 (May 09 close)

Change for the week: 3.40%

19.04

mWIG40

Compared to the week before it, last week was rather calm. But that does not mean we didn’t see some big movements in the currencies market.

Macroeconomic data both from the US and China was positive, bringing global risk aversion down. The EUR/USD tried one more attack towards the $1.32 level, but being unable to break it, a larger corrective movement began bringing the main currency pair down to $1.30. Lower levels might be seen next week if the support at $1.2950 is broken.

On the local market we experienced a move from the Monetary Policy Council

(RPP), which cut interest rates by 25bp to 3.00 percent.

It seems that the market had already priced in the May cut though, as the reaction on the z∏oty pairs was muted. Also, let’s keep in mind market participants expect at least one more cut by the end of the year, and this information is already in the z∏oty prices.

The EUR/PLN, which headed downwards after the RPP’s decision to reach a weekly low of z∏.4.12, rebounded by the end of the week to z∏.4.14. The USD/PLN showed more volatility, first declining to z∏.3.13 but rebounding to z∏.3.18 by the end of the week. ●

currency rates 3.1425

3.1803 09.05

10.05

3.1986 08.05

SOURCE: NBP

3.2064

3.1844 06.05

02.05

3.2386

0.1019 10.05

0.1008

3.1

07.05

PLN-100JPY

3.3

09.05

0.1016 08.05

0.1022 07.05

0.1018 06.05

0.1005 0.1004

02.05

3.3572

3.3244 10.05

08.05

07.05

06.05

02.05

3.2

PLN-RUB

0.1030

09.05

3.3684

3.3774

3.3760

PLN-CHF

4.9087 10.05

4.8858

3.3950

3.4

09.05

4.8964 08.05

4.9370 07.05

06.05

02.05

4.9040

3.1861 10.05

3.1392

4.8

4.9251

PLN-GBP

5.0

09.05

3.1609 08.05

3.1767 07.05

06.05

3.1492 02.05

4.1285

4.1417 10.05

3.1

3.1646

PLN-USD

3.2

09.05

4.1487 08.05

4.1550

07.05

06.05

4.1485 02.05

4.1

4.1479

PLN-EUR

4.2

SPORTS

MAY 13-19, 2013

www.wbj.pl

21

American football

Soccer

Anderson powers Eagles over Koz∏y

Legia wins its 16th Polish Cup

Clarence Anderson almost single-handedly gave the Warsaw Eagles their first win at their new stadium on Konwiktorska on May 5, taking two punts the length of the field and scoring on two long touchdown passes to help the Eagles secure a 3522 victory over the upstart Koz∏y Poznaƒ. The win, which moved Warsaw into sole possession of second place in the Topliga North Division, was the ninth consecutive for the Eagles over the Koz∏y.

The game took on a much different complexion than that of Warsaw’s 39-0 season-opening victory in Poznaƒ, although the Eagles led 14-0 after a quarter of play.

Poznaƒ came back in the second quarter, behind their new quarterback Jeffrey Legree.

The American brought an entirely new dimension to the previously ground-based Koz∏y attack. He cut the lead to 14-7 with a twoyard run, but the Eagles bounced back with Mr Anderson’s second touchdown on the day to take a 21-7 halftime

COURTESY OF MARCIN FIJA¸KOWSKI/WARSAW EAGLES COURTESY OF LEGIA.COM/MATEUSZ KOSTRZEWA

Warsaw swept the season series against the quickly improving Poznaƒ team with a 3522 victory

The Eagle’s Clarence Anderson was the star of the game, with four touchdowns lead.

The Poznaƒ defense, led by two-way star Ivan Pavlovic, stepped up in the second half, keeping Warsaw’s offense off of the scoreboard for the entire second half of the game.

But Mr Anderson answered the call for the Eagles. On the final play of the third quarter, he took a punt from just in front of his own goal line and weaved his way through the entire Poznaƒ kicking unit. Then, just to show that it was no fluke, he did it all once again early in the fourth.

The Koz∏y continued to fight, managing to put a scare

into the home team before the game was done. Despite that effort, the final score read 3522 in favor of the hometown Eagles.

In other games, the Giants beat the Devils in the Wroc∏aw derby, 27-18, the Zag∏´bie Steelers Interpromex edged the AZS Silesia Rebels 20-16, while the Warsaw Spartans were walloped, once again, by the defending champion Seahawks Gdynia, 76-0.

The long May weekend saw record attendance at PLFA games, with each game averaging over 1,400 fans attending.

AZ, AK

DAILY EXECUTIVE DIGEST Poland A.M. gives you the biggest Polish stories of the day.

Have the most valuable news delivered to your inbox each weekday morning.

S i g n u p f o r a 2 - w e e k f r e e - t r i a l ! w w w. p o l a n d a m . p l G e r m a n v e r s i o n : w w w. p o l e n a m m o r g e n . p l

The nearly 30,000 Legia fans in attendance watched a nail-biter of a game before their team came out victorious

Legia Warszawa won on aggregate 2-1 against Âlàsk Wroc∏aw to take home the first trophy of the season Before the second leg of the Polish Cup final was even played, most followers of Polish soccer were sure that only one outcome was possible.

After a decisive 2-0 win in Wroc∏aw, Legia Warszawa was confident that it would add yet another Cup to its trophy case.

But that all changed in the second minute of the game last week. After a catastrophic error by Legia’s defense inside their own box, Micha∏ ˚ew∏akow put the ball in his

own net, giving Âlàsk the lead.

Nearly 90 minutes of game remained for the Wroc∏aw side to score the equalizer.

That early goal put much needed wind in Âlàsk’s sails.

Their attacks were numerous and dangerous, while Legia players tried hard to keep the action at a safe distance from their box. The situation on the field quickly enraged Legia’s coach Jan Urban, who acted quickly, making his first substitution before the first half was over.

But that didn’t change the situation on the pitch. As the minutes went by and the end of the game approached, Âlàsk seemed ever closer to scoring a second goal, which

would have brought the game into overtime. The team’s rapid – and bold – counterattacks created chaos in Legia’s defensive formations.

The closest Âlàsk came to scoring, however, was in the 74th minute, when Piotr åwielong lobbed the ball over Legia keeper and hit the crossbar.

Luckily for the nearly 30,000 Legia fans in attendance, the Warsaw side managed to make it to the final whistle without losing another goal, winning the team’s third-consecutive Polish Cup and 16th overall – a feat unprecedented in the history of Polish soccer.

Jacek Ciesnowski

22

LIFESTYLE

www.wbj.pl

MAY 13-19, 2013

Concert

Exhibition

Sundays in the park with Chopin

Grappling with the past

The Chopin Statue in ¸azienki Park Chopin in ¸azienki May 19-September 29 ¸azienki Park Nothing signals the start of the warm weather in Warsaw better than the open air concerts that take place every Sunday from mid-May through September in the capital’s most picturesque and historic park – ¸azienki. Formally known as ¸azienki Królweskie (the Royal Baths), the park is the city’s largest green space, and once acted as the private

gardens of Poland’s last monarch, King Stanis∏aw II August. The grounds serve as the perfect setting for a weekly celebration of the country’s most famous classical composer and pianist, Fryderyk Chopin, who was born near Warsaw in 1810.

An annual tradition since 1959, the concerts, which will see some of the world’s most talented pianists playing the composer’s best-loved compositions, take place each week

at 12 pm and 4 pm next to the park’s Chopin Statue.

This year’s schedule includes pianists from Canada, China, Croatia, the Czech Republic, Japan, Luxembourg, Slovenia, the UK and many from Poland.

With all the of performances completely free of charge to the public, these concerts, which run until the end of September, are a must-attend event on Warsaw’s cultural calDavid Ingham ender.

Organized to commemorate the 70th anniversary of the Warsaw Ghetto Uprising, this exhibition presents the works of artists who in various ways have attempted to tackle the difficult subject of the Holocaust.

The exhibition features works by artists who survived the Holocaust, including Tadeusz Kantor and W∏adys∏aw Strzemiƒski, as well as the work of younger artists such as Miros∏aw Ba∏ka, Zbigniew Libera and Maciej Toporowicz, who attempt to grapple with these terrible events of the past.

According to organizers, the exhibition “refers to the tradition of exhibitions organized just after the Shoah, in 1948, when two displays together with a contest for works concerning the Holocaust were arranged at the seat of the institute.”

In an accompanying exhibition in the Kordegarda Gallery, at ul. Krakowskie PrzedmieÊcie 14, artifacts from the period and a catalog featuring a selection of Polish poetry about the Holocaust will be displayed.

COURTESY OF WWW.JHI.PL

COURTESY OF PAWE¸ KABA¡SKI /WIKIMEDIA COMMONS

Polish Art and the Holocaust Ongoing until July 31 Jewish Historical Institute of Emanuel Ringelblum ul. T∏omackie 3/5 Warsaw

Polish Art and the Holocaust – exhibition poster The Jewish Historical Institute is located in a building which once housed the Main Judaic Library in Warsaw. The building was partially destroyed by the Nazis during World War II, however parts of the original walls were incorporated in to

the current structure. Opened in 1928, the building was originally the first-ever Jewish research and educational center in Europe.

David Ingham

For more information, log on to jhi.pl

LAST WORD

MAY 13-19, 2013

www.wbj.pl

23

Tech Eye

The MP-05 “LaFerrari” Construction worker. That’s the worst job Techeye has ever had. Moving bricks from one part of a work site to another, every day, then moving them back, also every day – that’s no way to live.

And this is coming from a fellow who has worked as a fruit picker, driven a shuttle service for drunk, overprivileged students, endured long, greasy nights as a fry cook, and served as a medical test subject. Rewarding jobs, all, in comparison to construc-

derives from 11 intricate barrels, arranged spine-like down the center of the device.

If the MP-05 “LaFerrari” is an ideal accoutrement for filthy-rich car lovers, then the Chaos Automatic Analogue is the perfect fashion statement for geriatric action stars.

Produced by Montegrappa, best known for its fine writing implements, and partly designed by Sylvester Stallone, best known as Hollywood’s gruntiest mumbler, the Chaos Automatic Analogue combines chic timekeeping with a gauche snake-andskull motif. Its 54mm by 43mm case comes in silver or gold, the face is anti-reflective sapphire crystal and power comes from a sturdy ETA 2824 (an automatic-winding, 25-jewel movement).

How much does the Chaos Automatic Analogue cost? No idea. But an earlier Stallone-Montegrappa collaboration resulted in a $5,000 pen, so we expect the watch to cost at least that much.

The last item this week is from watchmaker MB&F, but it isn’t a watch. It’s a music box.

Looking like something from Fritz Lang’s “Metropolis,” the Music Machine is equipped with two brass

COURTESY OF MB&F

tion work. Even our tragic stint as a costs a thrilling $300,000. Of course, if lingerie model was better, and that you’re already splashing out on a real ended in a mysterious, weeping rash, LaFerrari, with its (estimated) $1.3 acquired from an unwashed thong. million price tag, then Hublot’s asking Still, there’s one job we’ve always price is probably pocket change. wanted to try that’s somewhat analoThis is a limited edition timepiece gous to construction, yet equally anti- (only 50 are being made) with a sapthetical. A job whose sheer awesome- phire crystal face. It boasts a 50-day ness could overwrite our memories of power reserve, which is a “world futile brick-moving. record for a hand-wound tourbillon Watchmaker. Of the Patek wristwatch” (although technically it’s Philippe variety, mind you, not the not hand wound – you use a special Casio kind.

“Hublot winding drill”). The watch is Watchmaking is a fascinating craft, built from 637 components, more one steeped in tradition and yet thor- than any other Hublot wristwatch, oughly modern. It’s an odd industry, and its noteworthy power reserve hard to break into (unless you’re Swiss). It’s inbred, opaque and populated by the kind of intelligent-yetemotionally deficient characters that you’d imagine keep bondage-dungeon designers in steady work. The perfect industry for Techeye, in other words.

The money’s pretty good too, judging by the prices quoted at BaselWorld 2013, an industry event held earlier this month in Switzerland.

Take the MP-05 “LaFerrari” from Hublot. Designed to resemble its namesake, the recently unveiled supercar from Ferrari, this watch The Chaos Automatic Analogue A PP RA EG NT MO F YO TES UR CO

COU RTES Y OF

HUB LOT

Oh, to be a watchmaker

The Music Machine cylinders, each of which plays three melodies. The left cylinder plays extracts from John Williams’ “Star Wars” and “Imperial March” themes, as well as the “Star Trek” title song.

The right cylinder, meanwhile, plays Pink Floyd’s “Another Brick in the Wall,” Deep Purple’s “Smoke on the Water” and John Lennon’s “Imagine.” Because what else is a retrospaceship-music box going to play?

Only 66 Music Machines will be made (33 white and 33 black), each costing $13,000. That’s a significant sum, and more evidence that the watchmakers dance to their own tune, but it’s fine by us.

In fact, if we ever make it into the industry, we’ll design a hybrid music box-wristwatch and call it the “Construction Work is for Suckers.” ●

Ever caught a mysterious, weeping rash at a lingerie photo shoot? Let us know: techeye.wbj@gmail.com

To advertise in WBJ’s classifieds section, contact Agnieszka Brejwo, at (+48) 222-577-526 or abrejwo@wbj.pl

80% LEASED

Natural space for your business Warsaw

Poznan

Wroclaw

First phase completion Q 3 2012

First phase completion 2014

First phase completion 2015

Leasing +48 22 370 14 44 T: (+48) 22 370 14 44 F: (+48) 22 820 91 40 E: info@swedecenter.pl W: www.swedecenter.pl