May 14th 2009,
Number 122




Dear Readers,

The latest economic forecasts confirm the fact that Poland continues among countries which have not been hit hard by the current economic crisis. Despite negative adjustments the Polish GDP still ranks among the best in Europe. Also rating agencies keep their high assessment of the country’s financial credibility.

This week we particularly recommend the account of the opening ceremony of the Technology Park in Dolny ¦l±sk and details concerning the project of the Warmia thermal complex which is to be realised in the frame of PPP.

Pleasant reading!

PAIiIZ’s editorial team

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PAIiIZ Conference

The Polish Information and Foreign Investment Agency (PAIiIZ) invites to a conference: „Food industry in Poland - opportunities and challenges in the era of economic downturn” which is to take place on May 27th , 2009 at the PAIiIZ Information Centre at 12 Bagatela Str. in Warsaw from 11 a.m. to 12.45 a.m.

The aim of the conference is to provide a platform for experience and opinion exchange in the field of the food industry’s development prognoses, the sector’s condition on the market as well as te barriers and challenges to be faced by the industry. We hope for a constructive debate and conclusions which will prove useful in initiating possible anit-crisis activities and investment support initiatives in the sector.

The conference will be attended by delegates from the Ministry of Agriculture and Rural Development, authorities from the region of Podlasie, institutions co-operating with the food industry, research institutes and investors already active or interested in the sector. Participation is free of charge. The conference will be held in Polish but simultaneous translation into English will be provided by the organisers. To confirm your participation contact Ms Katarzyna Rosińska at katarzyna.rosinska@paiz.gov.pl.

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New publication on PPP

PAIiIZ recommends a recently published publication on “Public Private Partnership in Poland”.

The study was prepared by Investment Support and presents the market of publicprivate investments together with legal and financial aspects concerning the realisation of such projects in Poland. For more information visit www.paiz.gov.pl section Publications.

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Ministry of Economy: “The first 5 Polish years in the European Union”

The Ministry of Economy published a document summing up the first five years of Poland’s presence in the European Union. It shows that the accession stimulated the pace of economic development and increased foreign trade turnover. The five EU years saw also a rise in FDI inflow to Poland.

According to the Economy Minister these are the most important effects of the EU accession. The report “The first 5 Polish years in the European Union” was prepared to celebrate the fifth accession anniversary. The document contains several analyses concerning the accession’s influence on industry development, innovation, investment and foreign trade. Topics related to the situation on the Polish labour market and the country’s preparations to enter the euro zone were also brought up in the analyses.

The first five years of the Polish presence in the EU witnessed considerable changes in the structure of the country’s economy. Undoubtedly the sharp acceleration of economic growth resulting in the country’s economic development exceeding other European economies has much to do with the Polish EU membership. The fact, that Poland joined the EU has also help increase investment activities on the part of Polish companies both in the country and abroad. Polish presence in the European structures has undoubtedly stimulated foreign investors to transfer their production activities to Poland.

Polish EU membership translates also in a drastic change on the Polish labour market. Due to the The free movement of persons and workers since 2004 Poles have the possibility to legally work in selected EU member states what did generate a considerable emigration not without effects on domestic labour market and personnel resources of Polish companies.

The report was prepared by analysts from the Analyses and Forecasts Department of the Ministry of Economy in co-operation with the Gdańsk Institute for Market Economics (IBnGR), Institute for Market, Consumption and Business Cycles Research (IBRKK) and the Institute for Structural Research. (Ministry of Economy)

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  • Unemployment rate drops

    April saw the unemployment rate fall from 12% to 11% - informed the Ministry of Labour and Social Policy.

    Labour Minister Jolanta Fedan hopes the unemployment rates will stabilize at 11%. The Minister added that the fall results from the initiation of seasons in such sectors as agriculture, forestry and tourism. (PAP)

  • 5 mln people bought products via Internet

    5 mln Poles opted for buying products via Internet in 2007 i.e. 1mln more than a year earlier- informs the Office of Competition and Cansumer Protection (UOKiK). (PAP)

  • Exchange rates (as of 14.05.2009):










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Małopolska performs best in spending EU funds

Małopolska results to be the leader in EU using EU funds allocated to the country for the years 2007-2013 - shows a ranking prepared by “Gazeta Prawna”. Małopolska tops three of the ranking’s categories.

Beneficiaries in the region of Małopolska were paid out almost 55 mln PLN what translates int the best result concerning effective EU funds allocation from among all Polish regions. The region witnessed the highest number of subsidy contracts, worth close to 380 mln PLN, signed. The overall value of contracts signed in the frame of the 2007-2013 financial perspective reached 750 mln PLN, again the highest in Poland. The region of Małopolska was followed by ¦l±sk and Dolny ¦l±sk. The ranking was closed by Mazowsze, Lubuskie and Zachodniopomorskie with the value of contracts signed in each of the regions not exceeding 100 mln PLN. (Gazeta Prawna)

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Dolny ¦l±sk Technology Park opened

The Dolny ¦l±sk Technology Park was officially opened on May 8th, 2009. The T-Park is located in Szczawno-Zdrój andranks among the most modern..

Danuta Hübner - the European Commissioner for Regional Policy attended the opening ceremony (Source: T-Park)

The opening Cremony was attended by, among other guests, Ms Danuta Hübner - the European Commissioner for Regional Policy, Mr Leszek Balcerowicz - the former Deputy Prime Minister, Finance Minister and head of the National Bank of Poland, Sławomir Majman - Deputy PAIiIZ President, Andrzej Szortyka - Deputy President of the Regional Development Agency, Zbigniew Chlebowski MP. The opening gathered also representatives of local and regional authorities i.e. Marek Łapiński - Marshal of the region of Dolny ¦l±sk, Piotr Kruczkowski - president of the city of Wałbrzych and Tadeusz WlaĽlak - mayor of Szczawno - Zdrój.

During the ceremony Danuta Hübner emphasised the role technology parks play in regional and innovation-oriented policies of the European Union. - The project realised in Szczawno Zdrój does have a meaning for the whole UE because effective integration of all local communities and their efforts to develop are a prerequisite for the development of the whole Europe. - said Ms Hübner.

The T-Park in Szczawno-Zdrój is one of the biggest EU projects realised in he region. 75% of the invested 53mln PLN came from the European Cohesion Policy. The project is expected to attract Polish and foreign investors who are bound to generate new jobs. As for local entrepreneurs the facility should help them take advantage of modern technologies and innovations. The facility is open both to well-known and experienced businesses and to start-ups which may use the incubator to develop their business.

The laboratory and office space includes a 4-module R&D Centre with 1000 m² of commercial office space, 200 m² laboratories, a 800 m² production and research shop floor, 5 conference halls and 400 m² warehouses. Beside the office space the Park offers a number of fully-developed lots measuring between 2ha to 8ha interconnected by internal road net. Entrepreneurs who opt to locate their factories in the T-Park may count on public support on terms similar to the ones applied in the Polish SEZs. The Park is open to host companies from a variety of sectors e.g. car industry, electronics, IT, nedicine or renewable energy sources. - We want to attract either companies able to creates innovative projects or are able to successfully apply innovations prepared by third parties in their production - said Sławomir Hunek, president of the Dolny ¦l±sk Development Agency.

The Agency will continually provide support for companies investing in the T-Park in that they will help them access EU funds, prepare and develop projects and establish co-operatio with foreign partners. The regional Development Agency which will aslo guarantee support from business environment i.e. investors will have lending funds, banks, law and accountancy offices, translation agencies and a centre of Enterprise Europe Network West Poland at their disposal.

The T-Park has started its preparations and promotional activities in March 2009 and since that time managed to attract 18 companies which are now occupying 35% of the Park’s area. (T-Park)

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Thermal springs in Warmia developed in the frame of new PPP principles

The Lidzbark county seeks a private partner to realise the project of the Warmia thermal springs i.e. a complex of thermal swimming pools, bioregeneration facility and a hotel.

Within the meaning of the ACT on PPP the Lidzbark county as a Public Partner organised a bidding and invited partners to file applications in order to select a partner and to sign a PPP contract. The subject of the contract will be the conditions concerning the realisation of the Warmia thermal springs project. In the frame of the contract it will be the task of the Private Partner to design, construct and manage the completed complex of indoor and outdoor swimming pools using geothermal water, the bioregenaration facilities and a hotel with sport facilities in Lidzbark Warmiński.

The investment was isncluded in the indicative list of major projects in the Regional Operational Programme Warmia and Mazury 2007-2013 and foresees project financing up to 50% of qualified costs. The swimming pool complex will use briny water of around 27-360 C. The complex is to be located in Lidzbark Warmiński close to the national road No 51 which leads to the border crossing with Kaliningrad Oblast in Bezledy.

The Warmia Thermal Complex (Source: The county of Lidzbark)

The estimated area of the swimming pools is bound to reach 2000 - 2500 m² and will be supplied with water from local water intake. The main building of the complex will comprise of recreational and balneological swimming pools kitted out with numerous attractions e.g. chutes, fountains, massages, waterfalls, saunas, jacuzzi, salt caves, solaria, fitness clubs, a bowling alley, restaurants and new forms of rehabilitation. The outdoor swimming pools will mainly be devoted for recreational use. There are also plans to construct a hotel for round 200 people with a conference centre. The whole complex will be surrounded by a green area including a tennis course, small sports fields, graduation towers, walking, bike and roller-skate paths, a range-golf course and car parks. A special “beaver playground” promoted by the animal, a symbols of co-operation with the neighboring natural landscape parks, will be constructed for children.

The Lidzbark county is located in the north-west part of the Warmia-Mazury region has 46,000 residents and occupies 924,4 km². The immediate neighbourhood of the country ranks among the so called “Polish Green Lungs”. Among the greatest advantages of the region there are the good soil, mild climate, rich water sources and the variety of animals and plants. (the county of Lidzbark Warmiński)

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The latest economic forecasts by “The Economist”: Poland the leader of the EU

The latest economic forecasts by “The Economist” concerning GDP growth for the years 2009-2010 were adjusted yet Poland still positively stand out against the backdrop of other European countries.

“The Economist” forecasts this year the euro zone may experience its GDP fall to -3.4% and the next year may see GDP increase slightly over +0.2%.

Generally, 2010 is expected to see Europe overcome the crisis, for Poland the year should translate into a comeback on the path of dynamic development. While in 2009 Poland is expected to record a negative GDP dynamics at around -0.4%, in 2010 the country should generate a +1.8% GDP growth. Only Russia is estimated to reach better results in 2010 with a 2.0% GDP increase. Nevertheless this year Russian economy will shrink to -3.0%.

The latest Economist report confirms the fact that Poland has not been among those hard hit by the crisis. The April report indicated Poland as the only European country with positive GDO. Despite the May adjustment, Poland still enjoys positive economic indicators and optimistic prognoses for the future. (The Economist)

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The ratings agency - Fitch: Poland still immune to the downturn

It is the stable macroeconomic situation, widely varied export and efficient monetary policy management that made Poland fare so well in the Fitch rating.

The Agency published a report devoted to Poland and the country’s financial credibility. The report contains a justification of the long-term Poland’s rating for the country’s debt In foreign currency on the level “A-“ and in the Polish zloty on “A”. At the same time the agency kept the short-term rating for the country’s foreign currency debt at the average level of “F2” and for the debt in Polish złoty at a high “AA-“level.

The analysts stressed the acceleration of structural reforms I the country would undoubtedly have a positive influence on future ratings. The same applies to the implementation of the Maastricht criteria and the adoption of euro. Fitch experts deem 2013 as the closest possible date when Poland could enter the euro zone. As for possible challenges, the expert warned against the possible consequences and public debt increase due to slow GDP growth, greater deficit and weaker złoty. (Fitch Polska)

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Polish Confederation of Private Employers Lewiatan: a diagnosis and some advice for the time of crisis

PKPP Lewiatan and the advisory firm Deloitte presented results of a mutually conducted research of big companies. The presentation was attended by entrepreneurs and experts.

Authors of the report informed abort the overall economic condition around the world and the probable influence the situation may have on Polish companies. The report focused on possible fears big companies may experience in the era of global crisis and the areas they may still see prone to development. The research showed also legal procedures which tend to generate most problems for big companies. Disussion panels organised during the presentation were attended by Adam Szejnfeld Secretary of State at the Ministry of Economy, Enrico Pavoni President of Fiat Auto Poland, Henryk Orfinger president of the Irena Eris’ supervisory board, Paweł Smoleń president of Vattenfall Heat Poland and Czesław Grzesiak deputy president of Tesco Polska.

Representatives of Deloitte emphasised the fact that crisis always makes diverse national economies react in a variety of ways thus ways of tackling and recommendations should also be to a large extend customized to suit particular country or company. The analysts claim that the oncoming months will prove decisive for enterprise development and for banks which will review their clients and adjust their business model to the current situation. Enterprises should take advantage of the moves to slash their operational costs and devise plans that should work should they be hit by the crisis (including possible mergers and takeovers).

Among the barriers encountered by big companies and discussed by Ms Małgorzata Starczewska-Krzysztoszek from PKPP “Lewiatan” there were the Act on VAT, the Labour Code and the Act on CIT. Tax regulations tend to be ambiguous, non-transparent and are often changed.

In the face of high currency risk, the experts recommend the government to initiate coherent action and define concrete strategies towards joining ERM 2. The already high and ever growing payment blockades should bring about improvements in the economic jurisdiction and streamline the system of regulations concerning VAT. Decrease in administration cost are also highly desirable. (PKPP „Lewiatan”)

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Editorial office: Polish Information and Foreign Investment Agency, 00-585 Warsaw, Bagatela Street 12
Economic Promotion Department, tel: (+48 22) 334 98 15, fax: (+48 22) 334 99 99,
e-mail: redakcja@paiz.gov.pl
Polish Infomation and Foreign Investment Agency www.paiz.gov.pl