|POLISH INFOMATION AND FOREIGN INVESTMENT AGENCY|
May 21st 2009,
TABLE OF CONTENTS
INVESTMENTS IN POLAND
FROM THE REGIONS
ANALYSES AND REPORTS
DID YOU KNOW...?
FROM THE EDITOR
This week we recommend to pay attention to optimistic economic forecasts for Poland presented by analysts from Raiffeisen Bank and the president of the World Bank Robert Zoellick. Also this week OECD published its report on tax reforms which positively assesses Polish efforts to reduce the so called tax wedges. We also write about the last four months on the Warsaw Stock Exchange which again turns out to be the leading bourse in the whole CEE region.
PAIiIZ’s editorial team
PAIiIZ Conference - date changed
The PAIiIZ conference: “Food industry in Poland – opportunities and challenges in the era of economic downturn” will not be held on May 27th, 2009. You will find information about the new date of the conference in the Newsletter and on our website: www.paiz.gov.pl.
Investors visit Mazowsze
The Agency for Development of Mazowsze organises a study visit for investors who together with representatives of embassies and chambers of commerce will explore the region of Mazowsze. In this year’s edition, to start on June 18th, 2009, it is the north-east Mazowsze that will get the limelight.
Study Tour IV Discovering north-east Mazowsze wants to stimulate interest in the region’s investment offer. Participating investors will find out about the experiences of foreign companies who have successfully managed to run business in Mazowesze. The study visit involves a visit to the factories of Stora Enso Poland and ENERGA Elektrownie Ostrołęka S.A. Investors will also visit Pułtusk, Ostrołęka and a Museum of the Kurpie Culture, a manor-house in Susk Stary and an open-air ethnographic museum in Nowogrodzie.
Honorary Patrons: Marshal of the Mazowsze region, Mazowsze’s Voivode and the Polish Information and Foreign Investment Agency. For more information go to www.armsa.pl (ARM S.A.)
Warsaw Stock Exchange still the best in the region
After the first four months of 2009 the Warsaw Stock Exchange (GPW) continues on the leading position in the CEE and SEE in terms of turnover .
Between January and April this year the value of share turnover at the Warsaw bourse exceeded the turnover achieved in Vienna and Athens.
As of the end of April 2009, the Warsaw-based stock exchange achieved a turnover of 10.69 mld EUR while the same period saw the Athens stock obtain 10.62 mld EUR and the Vienna-based stock reach 10.03 mld EUR.
April this year witnessed a 23% increase in share trading in Athens and a 18% growth in Vienna when compared to March this year. The Warsaw stock (in EUR) grew by round 27% and reached the level recorded in December 2008. - Warsaw becomes an international market – and the stock trading centre for the whole region. The fact finds reflection not only in the number of foreign companies listed on the stock but also in the growing number of global investors interested in the Polish market - said Ludwik Sobolewski, president of the Warsaw bourse.
- At the beginning of 2008 the difference between the capitalisation of the stocks in Vienna and Warsaw accounted for 12 mld EUR, to the advantage of the Austrian stock. At the moment the value of companies listed in Warsaw exceeds the Vienna-based bourse by 5 mld EUR. The dynamics of the Polish stock gives reasons to think that the situation is bound to change. - says Mr Sobolewski.
The Warsaw Stock Exchange may boast about the highest number of listed companies, the biggest forward market and the second most valuable capitalisation of domestic companies.
In terms of the number and value of the Initial Public Offering (IPO), the Warsaw stock not only outperformed all the bourses in the region but has also become the leader in the whole of Europe. According to the report IPO Watch Europe, every 6 out of 18 European IPOs in the 1st Q 2009 took place in Warsaw. Also the value of offers at the GPW classifies the bourse at the first positions of rankings assessing the 1st Q of 2009. (Warsaw Stock Exchange)
OECD: in 2008 Poland reduced the tax wedge
This year’s edition of OECD Taxing Wages report says Poland shows the biggest drop in taxes on wedge earners.
Tax wedge defines the difference between before-tax and after-tax wages. The OECD report shows that last year in Poland the tax burden for a single person on average earnings fell by 3.2 % to 39.7%. Poland was followed by Turkey where the tax fell by 3% to 39.7%.
At the top end of the scale, single individuals without children earning the average wage in services and manufacturing industries faced a tax wedge of 56.0% of the cost of their labour to their employers in Belgium, 54.1% in Hungary and 52.0% in Germany.
At the bottom end of the scale there was Mexico (15.1%), Korea (20.3%) and New Zealand (21.2%). The average for OECD countries was 37.4%. (OECD, PAP)
World Bank President Robert B. Zoellick visited Poland
Zoellick said that in the era of global economic crisis Poland has been performing better than other countries what has been confirmed by the special credit line opened at the International Monetary Fund.
- The global economy may be back on the “growth path” at the end of 2009 or in 2010 - said the World Bank president Robert B. Zoellick during his visit to Poland. He added that the Polish economy has been in a relatively good condition. - Poland has a better situation than other countries. Partly due to the level of consumer spending but one should not forget that we are in an economic crisis and Poland depends largely on export - emphasised Zoellick.
The good situation was confirmed by the opening of the special credit line at the International Monetary Fund and stressed the fact that the country successfully managed to avoid getting risky credits in foreign currency. Zoellick claims that we will continue experiencing falls in the GDP dynamics worldwide, yet the drops will be more modest.
Zoellick, who described his visit as an intent to discuss “potential risks” ahead of the Polish economy and ways in which the World Bank could help tackle them, spoke to Sławomir Skrzypek, president of the National Bank of Poland (NBP) and the finance minister Jacek Rostowski.
One of the topics brought up during the meetings concerned the realization of a 3.75 mld USD credit programme supporting Polish reforms. During a press conference Zoellick stressed that almost 50% of the programme has already been realized. (Tvn24.pl, PAP)
INVESTMENTS IN POLAND
Mitsubishi Electric invests in Poland
Mitsubishi Electric Europe B.V. takes over all the shares from its distributors in Poland i.e. MPL Technology and MPL Tech Group. This is the first Mitsubishi’s large-scale investment in Poland.
The recently established Mitsubishi facility is to draw on the structure created by the previous partners and distributors who have been present in the Polish automatics industry for the last 15 years. The company wants to immediately and fully incorporate MPL Technology and MPL Tech Group into Mitsubishi Electric. The Polish division will principally deal with providing services and support for sales processes geared toward the local market. The facility will also operate as a central for the whole CEE region i.e. Poland, the Czech Republic, Hungary and Slovakia and will acquire a leading role in every aspect of the division’s activities concerning the region what includes the formation of development strategies, technical support and services.
Noriaki Nimi - member of the Mitsubishi Electric Europe management board said that the company decided to invest in the project because it continues involved in the automatics industry’s development schemes despite the global economic downturn. Mitsubishi Electric B.V. is a European company dependent on the Japanese Mitsubishi Electric. The corporation has been producing electric and electronic devices, components for automatic engineering and the satellite and cosmic technology for the last 80 years. The company’s annual fiscal balance as of the end of March 2009 shows the total amount of sales revenues equaled 37.4 mld USD. (MPL Technology)
FROM THE REGIONS
New business activity permits in the Kraków SEZ
The Kraków Technology Park already granted a total of 70 business activity permits. In May also Shell Polska and Mobile Experts will be allowed to start operating in the Park.
Shell declared to create 150 new jobs. The investment will be located in the Zabierzów sub zone on an area included in the SEZ under the terms of SEZ regulations passed by the Council of Ministers on April 14th 2009. The planned investment outlay is bound to reach over 1.5 mln PLN. Shell will realize its projects in the frame of the Finance and Accountancy Centre, currently under construction, which provides the companies in the Shell Group with counseling service concerning accountancy issues and customer care.
In turn, Mobile Experts declared to generate 2 new workplaces and invest over 1.5 mln PLN. The project will be released within the Kraków Technology Park and located in the Czyżyny sub zone. The project envisages production of a complex mobile phone and mobile device software which is to be used in the most modern technology solutions applied in GSM and the IT sector.
The Park’s management is very satisfied with the new investors and especially with the fact that Mobile Experts invests in the Park’s technology incubator. Generally the Park’s development strategy places such projects and companies among its priorities. (Kraków SEZ)
ANALYSES AND REPORTS
EBRD: the beginning of the end of the downturn in the CEE region
- The CEE region may now expect to see the end of the crisis - says Thomas Mirow, president of the European Bank for Reconstruction and Development (EBRD).
Thomas Mirow draws his conclusions mainly from the better-than-expected results issued by banks and the fact that the region has been enjoying indices showing improving social mood. - EBRD’s economists predict the crisis to reach its climax in 2009 and than the region’s economies should slowly bounce back. - claims Mirow.
Last week the Bank adjusted its GDP growth forecasts for the CEE region to - 5.2% while in January this year the estimates hovered round 0.1%. Nevertheless, the Bank expects 2010 to see a +1.4% level of GDP dynamics for the region. Despite the optimistic views, Mirow made it clear that the world will need some time to leave the crisis behind. He emphasised that countries which will decide to impose higher taxes in order to tackle the problems are bound to play a crucial role in the process. (Gazeta Wyborcza)
Raiffeisen Bank: Poland to have the highest GDP in the region
- Poland is to have the highest GDP dynamics in the region because the country’s economy has not been exposed to external influences. - said Helena Horska, Prague-based Raiffeisen’s analyst in a discussion concerning the economic condition of Europe at the Polish Radio.
In reference to the Czech Republic, Helena Horska emphasised that the country suffered a 20% fall in export what resulted in a considerable drop in industrial production. Further negative information has also been published by statistical offices in other countries of the CEE region. Not only the German economy shrunk faster-than-expected. The same applies to Hungary, Slovakia and the Czech Republic.
Preliminary predictions show the Czech GDP fell by 3.4% in the 1st Q of 2009 y-o-y. The figure results to be 2% worse than the most optimistic forecasts and 1% worse than the results expected by the Czech Finance Ministry. Nevertheless, the figures are still better than in the neighbouring Slovakia where the GDP dropped by 5.4% and in Hungary where the GDP dynamics shrunk by 6.4%. (IAR)
DID YOU KNOW...?
Poland became the third biggest bus producer in Europe. Despite the global downturn, the bus sector has not been recording any slowdown in production. Quite the opposite - Poland manufactured more buses than a year ago, mainly for export.
A report by JMK Analizy Rynku Transportowego show that during the 1st Q of the year Polish factories produced 1148 buses i.e. 30% more than a year ago.
Poland became quite an important player in the sector on European level. Last year Polish factories produced jointly 4,500 buses what translated into the third position among EU bus producers, according to statistics published by the European Automobile Manufacturer’s Assotiation ACEA cited by JMK. Only Germany (10,000 produced buses) and Sweden (9,300)outperformed Poland in the field. This was the first time Poland outstripped France (4,100). Poland specializes in the production of urban buses which last year made up 75% of the output.
Poland hosts the key production facility of German MAN and Swedish Volvo and Scania. Polish Solaris Bus&Coach has been successfully competing with the foreign producers. Round 75% of the Polish production is directed to foreign markets. In 2008 Germany, the UK and Sweden ranked among the biggest customers. This year Greece is bound to classify on the second position due to a considerable contract with Solaris.
JMK analysts claim the bus producers may feel potential effects of crisis only in the second part of the year when the 2008 orders will have been realised. (JMK Analizy Rynku Transportowego, Gazeta Wyborcza)
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,