VOLUME 18, NUMBER 3 • JANUARY 23-29, 2012 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127 Since 1994 . Poland’s only business weekly in English

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The z∏otystrengthens –finally

Who was in the cockpitduring the 2010Smolensk plane crash?

KBC has sold its Polishinsurance unit for €770 million

News . . . . . . . . . . . . . . . . . . . . . . .2-4

Business . . . . . . . . . . . . . . . . . . . .5-6

Finance & Economics . . . . . . . . . . .7

Interview . . . . . . . . . . . . . . . . . . . .8-9

Opinion & Analysis . . . . . . . . .10-11

Cover Story . . . . . . . . . . . . . . . .12-13

Lokale Immobilia . . . . . . . . . . .15-18

The List . . . . . . . . . . . . . . . . . . . . . .19

Markets . . . . . . . . . . . . . . . . . . . . . .20

Sports . . . . . . . . . . . . . . . . . . . . . . .21

Lifestyle . . . . . . . . . . . . . . . . . . . . .22

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

REAL ESTATELokale Immobilia

• TriGranit in Poznaƒ

• Plac Unii financing

• Record office demand

15-18

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Interview: Rafa∏ GrupiƒskiThe leader of the

ruling party’s

parliamentary caucus

sees challenges on the

horizon 8-9

Poor ratingsAfter a series of

downgrades, more

calls for a “European”

ratings agency 4

In this issue

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RetirementplanThe prime minister’sproposal to raise theretirement age ismeeting plenty ofresistance, but Polesmay have no otherchoice than to accept it 11, 12-13

Tusk changes tunePrime Minister Tusk has threatened not to sign

the EU’s proposed fiscal union treaty 3

Well-oiled expectationsNow it’s not just shale gas – geologists think Poland

has significant shale oil deposits 5

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JANUARY 23-29, 2012NEWS2 www.wbj.pl

Chuck Norris

endorses

BZ WBK

Action-film star Chuck

Norris is set to become the

new face of Polish lender

Bank Zachodni WBK,

replacing Spanish actor

Antonio Banderas, who

featured in a campaign for

the bank last year.

Speaking about the choice

of Mr Norris for the bank’s

campaign, Artur Sikora,

head of corporate

communication and

marketing for BZ WBK

said “Chuck Norris is very

popular in Poland. He’s a

living legend, a nexus

between generations. …

He fits our brand. He’s

energetic, dynamic, fair

and righteous – always on

the good guys’ side in his

roles.”

‘In Darkness’

on Oscar

shortlist The new film by acclaimed

Polish film director

Agnieszka Holland has

been placed on the

shortlist for Best Foreign

Film at this year’s

Academy Awards. “In

Darkness,” tells the true

story of Leopold Soha, a

Pole who risked his own

life to shelter Jewish

citizens in the sewers of

Lviv, Ukraine (then part of

Poland) during its Nazi

occupation. Ms Holland’s

film is one of nine foreign-

language films on the

shortlist.

Israel’s FM

visits Warsaw

Israeli Foreign Minister

Avigdor Lieberman was in

Warsaw on January 15-16

for a two-day working

visit. Mr Lieberman met

Polish Foreign Minister

Rados∏aw Sikorski to

discuss the current

situation in the Middle

East, including the

consequences of the Arab

Spring, as well as the

issue of Iran and its

nuclear program and

tensions in the Persian

Gulf.

TVP expects

z∏.60 million

loss Polish public

broadcasting corporation

Telewizja Polska expects

to end the current

financial year with a net

loss totaling some z∏.60

million. The predicted

loss will partly be caused

by the cost of broad-

casting Euro 2012 and the

London Olympics. ●

AEW Europe ..............................17

APA Kury∏owicz & Associates

Studio ........................................16

Atrium ........................................17

Bank Millennium........................13

Bank Pekao................................16

Bank Zachodni WBK ............7, 15

BBI Development ......................16

Biedecki........................................8

Blackstone ................................17

BRE Bank ..................................15

Budimex ....................................16

BZ WBK ..................................2, 17

CA Immo ....................................17

Cushman & Wakefield ..............17

D&B Poland ..............................12

Deka ..........................................17

DM BZ WBK ................................5

DTZ ............................................15

ECE ............................................17

Edenred Poland ..........................6

Emmerson..................................18

Emperia........................................5

Ernst & Young ............................17

ExxonMobil ..................................5

Friendly Integration ..................23

Ghelamco ..................................15

Goodman Poland ........................6

Grupa Orlen................................17

Grupa TP ....................................17

HDI Asekuracja TU ......................6

HDI-Gerling Zycie TU ..................6

Heitman......................................17

Helical Poland............................15

HYPO NOE..................................15

IKEA............................................15

IMS Health ..................................8

Invesco........................................17

Jeronimo Martins ........................5

Jones Lang LaSall ....................17

JW Construction Holding ..........15

JW Wind......................................15

KBC ..............................................6

KBC Securities ............................5

KGHM ....................................8, 20

LG ..............................................23

Liebrecht & Wood ......................16

Mazowiecka Spó∏ka

Gazownictwa ..............................16

Meyer Bergman ........................17

Millennium Dom Maklerski ........7

Miller, Canfield, W. Babicki, A.

Chelchowski & Partners ..........13

native union................................23

Nordea Bank Polska..................15

PA Nova ......................................16

PGI’ ..............................................5

PGNiG ....................................5, 16

PKN Orlen ..................................20

PKO Bank Polski..........................7

PPG ............................................18

Raiffeisen Bank Polska ............15

Rodamco ....................................17

Société Générale........................13

Standard Life Investments ........15

Talanx Group ................................6

Tauron ..........................................5

The Boston Consulting Group ....7

TriGranit ....................................15

TUiR Warta ..................................6

Unibail ........................................17

Union ..........................................17

Vsf Creative

Architectural Studio ..................16

Warbud ......................................16

Warsaw Stock Exchange ............4

X-Trade Brokers

Dom Maklerski ..........................20

Xelion..........................................13

XTB Hungary ................................4

As WBJ went to press, interna-tional attention was focused onthe US state of South Carolinawhere the next, and possiblydecisive, Republican Partypresidential primary was sched-uled to take place.

Former Massachusetts Go-vernor Mitt Romney hoped thecontest would solidify his leadover the Republican field. MrRomney ran for president in2008 and put in a good per-formance in the two primariesthat have already taken placethis year.

Governor Romney wasoriginally declared the winnerof the January 3 Iowa caucuses.Last week that decision wasreversed, with officials sayingSenator Rick Santorum hadactually won by just 34 votes.

Mr Romney easily carried NewHampshire a week later, taking39 percent of the popular vote.

Mr Romney has been con-sidered the most likely candi-date to secure the Republicannomination since the beginningof the primary season. Severalpolls have indicated that he hasthe best chance of beating Pres-ident Barack Obama in thegeneral election on November6.

But Mr Romney’s leadseemed tenuous as WBJ wentto press, with some polls inSouth Carolina putting formerSpeaker of the House NewtGingrich ahead of the fron-trunner.

The hard-hitting campaignhas taken its casualties. On Jan-uary 19, Texas Governor Rick

Perry – originally hailed as theRepublicans’ darling – wasforced to withdraw from therace. He endorsed Mr Gingrich.

On January 16, formerUtah Governor Jon Huntsmanalso dropped out, endorsingMr Romney soon after. Earlier,two other major Republicanpresidential hopefuls, Con-gresswoman Michele Bach-mann and Georgia business-man Herman Cain halted theircampaigns.

Florida and Nevada are thenext states to hold Republicanpresidential primaries, on Jan-uary 31 and February 4 respec-tively. On March 6, 10 stateswill hold primaries – an eventthat is commonly referred to inUS politics as “Super Tuesday.”

Adam Zdrodowski

z∏.70 billionwas the total value of the shares held by private

pension funds (OFE) at the end of 2011, z∏.11 billionless than in 2010.

43,600 is the amount of cargo in metric tons that passed

through Warsaw Chopin airport in 2011, 6.7 percentmore than in 2010.

2,000is the number of complaints that were filed against aircarriers at Poland’s Civil Aviation Office in 2011. That’s

almost 50 percent more than a year earlier.

24 millionwas the number of people who listened to the radio on

a daily basis in Poland during 2011.

“The Polish z∏oty remains undervalued. …But whether it sustains the next wave of

turbulence in Europe – God knows.” National Bank of Poland president Marek Belka speaking to journalists inMoscow last week.

Quote of the Week

Polish-Japanese artist Koji KamojiTokyo-born artist Koji Kamoji has lived in Poland forover 50 years and his art, which is shaped by bothhis Japanese roots and his Polish upbringing, istruly unique. To find out more about his latest exhi-bition and how he ended up in Warsaw, log ontoWBJ.pl.

Numbers in the News

Company index

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JANUARY24-27 BUMASZEvent: This trade fair is a unique opportunity for

manufacturers and suppliers of machineryand construction equipment to establish newcontacts and maintain existing relationshipswith decision makers in the industry.

Location: Poznaƒ International FairWeb: bumasz.pl/en/

FEBRUARY3-5 MTT WROCLAW 2012 Event: This event bills itself as the largest trade

exhibition in Poland devoted to the travel andtourism industry. It will feature a wide rangeof products and services relating to theindustry as well as major industry players.

Location: Hala Stulecia, Wroc∏awWeb: mttwroclaw.pl/en

7 BRITISH-POLISH PPP FORUM Event: Entitled “Wroc∏aw for partnership – experi-

ence, plans and prospects for cooperation”this event will feature several discussionpanels on public-private partnership inPoland and around the world. Hosted byeconomist Robert Gwiazdowski

Location: Hala Stulecia, WroclawWeb: ppp.gov.pl

14 SHOPPING CENTER BUSINESS FORUMEvent: Now in its 14th edition, this event is an

opportunity to meet tenants and developersof commercial real estate. The organizer pro-vides access to web-based businessappointments between participants.

Location: Hilton Warsaw HotelWeb: scbf2012.retailnet.pl

January/February

DATELINE

The Republican Partypresidential primaries

IN THE SPOTLIGHT

Figures in focus

Baltic barbarismAverage homicide rate per 100,000 population, 2007-2009, selected European countries

Source: Eurostat

On WBJ.pl

Left to right: Romney, Gingrich, Santorum

The prime ministerwants a more inclusive deal

Prime Minister Donald Tusksaid last week that Poland mayrefuse to sign the EU fiscaltreaty if it is not allowed toparticipate in euro-zone sum-mits.

The latest draft of thetreaty envisages that meetingsheld by euro-zone countrieswill exclude EU memberstates who are not part of thecurrency bloc.

Mr Tusk criticized thedraft, telling a press confer-ence, “Our efforts aim at a fis-cal agreement the shape ofwhich does not make the divi-sion of Europe into two clubs –the euro zone and countriesoutside the club – more lastingthan is safe in our opinion.”

EU finance ministers aredue to meet this week to dis-cuss the issue of the exclusiveeuro-zone summits.

“Whether Poland joins thefiscal pact or not depends ontheir resolution,” Mr Tusk said.

The statement comes assomething of a surprise givenMr Tusk’s stolid response earlierin January when it first emergedthat Poland might be excludedfrom euro-zone summits.

“You can’t win them all,”he said at the time.

A change of attitude?“I know from sources whowere at the fiscal treaty negoti-ations that Poland feels it hasbeen snubbed and ignored,”said Maciej Golubiewski, anexpert in European politics atthe Sobieski Institute.

“Add to this the changing

mood in the country concern-ing Polish sovereignty that hasbeen fostered by the right –

which is saying Poland is pan-dering to EU demands – andMr Tusk has probably realized

that he now needs to play ittougher,” he added.

However, even the primeminister admitted that Polandhas a weak bargaining positionwithin the EU.

“We don’t have too manyallies on this issue – that’s thetruth. Some non-euro countriesaren’t interested in joining meet-ings of the euro group and mosteuro countries back the [exclu-sive] model,” Mr Tusk said.

Franco-German‘monopoly’ Mr Tusk also honed in last weekon his concerns over what hesees as a German and French“monopoly” on EU reforms.

“The fact that ChancellorMerkel and President Sarkozyhave taken the reins is obvi-ous. But this should notbecome a permanent political

monopoly. We can’t leaveEurope to two capitals,” hesaid in an interview with Ital-ian newspaper Corriere dellaSera.

“We shouldn’t criticize theactivism of Paris and Berlin –but we should be more presentand not leave all the initiativeto them,” he added.

Poland, he continued,should be able to have a say onthe future of the euro zone,even if it isn’t given votingrights at euro-zone summits.

“The chief of the Interna-tional Monetary Fund is pres-ent at the meetings. Today thisis Christine Lagarde ofFrance. In the future, anAmerican or a Chinese personmight fill the post. There is noreason to exclude other Euro-peans,” he said.

Gareth Price

JANUARY 23-29, 2012 NEWS www.wbj.pl 3

Smolensk findings

Government refuses to re-open Smolensk investigationAir Force GeneralAndrzej B∏asik maynot have been in thecockpit of thedoomed Smolenskflight during its finaldescent

Prime Minister Donald Tuskhas resisted calls for theinvestigation into theSmolensk catastrophe to bereopened after new findingsby a team of researchers inKraków brought into ques-tion the claim that Polish AirForce General AndrzejB∏asik was in the cockpit ofthe presidential Tupolev Tu-154 when it crashed on April10, 2010.

A team of forensicexperts from the Jan SehnInstitute of ForensicSciences in Kraków studiedrecordings from the cockpitand came to the conclusionthat a voice considered byRussian investigators tobelong to Mr B∏asik is, infact, not his.

The official Russianreport into the crash, whichclaimed the life of PresidentLech Kaczyƒski and 95 oth-ers, placed some of theblame for the disaster on theshoulders of General B∏asik.In the report, the Russianssaid he exerted psychologicalpressure on the pilots duringthe descent with the inten-tion of making them land theplane, despite conditions fordoing so being extremelyunfavorable. The reporteven suggested the generalwas drunk.

The official Polish report,meanwhile, said that MrB∏asik spoke in the cockpitduring the flight’s final min-utes, although it did not goas far as to say that he exert-ed psychological pressure onthe pilots.

By comparing earlierrecordings of Mr B∏asik’svoice to speech recordedfrom within the cockpit,however, the experts fromthe Jan Sehn Institutereached the conclusion that

the general did not in factspeak during the descent,thus contradicting the con-clusions of both the Russianand Polish reports.

‘All over again’The new findings ledJaros∏aw Kaczyƒski, leaderof opposition party Law andJustice (PiS) and the twinbrother of the late president,to say that the Polish investi-gation needed to “be startedall over again.”

But after a meetingbetween Jerzy Miller, theformer interior minister whoheaded the Smolensk investi-gation on the Polish side, andMr Kaczyƒski, a governmentspokesperson said there wasno need to reopen the inves-tigation, since “the findingsof the Institute of ForensicSciences in Kraków don’tbring into question the mainthesis of the report regardingthe cause and circumstancesof the catastrophe.”

Gareth Price, Remi Adekoya

European fiscal union

Tusk: Poland may not sign fiscal union treaty

Pop star Doda finedfor criticizing BibleDoda, one of Poland’s mostfamous pop stars, was orderedto pay a z∏.5,000 fine by a dis-trict court in Warsaw last weekafter she said the authors ofthe Bible were “wasted onwine” and had “smoked someherbs.”

Doda, who’s real name isDorota Rabczewska, made theremarks in a 2009 interview.The singer’s defense teamargued that her commentswere protected by her freedomof speech, while also insistingthat she had not intended tooffend anyone and that thetone of her interviews wereoften light-hearted and frivo-lous.

But on Monday, the judgein the case, Agnieszka Jarosz,ruled that the artist’s state-ments could not be defendedby an appeal to freedom ofspeech. She said MsRabczewska had the right “toassess [the content of theBible] in the context of scien-tific discovery but had no rightto insult” the religious text.

In August 2011, Adam“Nergal” Darski, the former

boyfriend of Ms Rabczewskaand lead singer of the Polishmetal band Behemoth, wasfound not guilty of offendingreligious feeling after he hadbeen filmed tearing pages out

of a Bible during a concert inGdynia in 2007. Mr Darskihad also referred to theCatholic religion as a “crimi-nal sect.”

David Ingham

PiS calls for Lech Kaczyƒski statue in Gdaƒsk Politicians from Poland’s mainopposition party, Law and Jus-tice (PiS), have called on thecity of Gdaƒsk to build a statueof former Polish PresidentLech Kaczyƒski, who died inthe 2010 Smolensk tragedy.

PiS MEPs Anna Fotyga andAndrzej Jaworski told a pressconference on Monday thatthe late president deserved to

be recognized for his contribu-tion to his home town.

“To this day we do not havea dignified commemoration ofthe late President LechKaczyƒski in the city ofGdaƒsk, the city with which hewas associated, where heworked, where he was vicechairman of Solidarity, wherehe helped the shipyard workers

during strikes,” said Ms Foty-ga, who served under MrKaczyƒski as head of the Chan-cellery of the President.

Mr Jaworski said that thecity’s authorities were reluctantto agree to a statue commemo-rating Mr Kaczyƒski despitebeing aware of the importantrole he played in Gdaƒsk’s his-tory.

“No one today disputes themerits of President LechKaczyƒski and what he did forGdaƒsk. … And this is thething that is permanentlyinscribed in the history of ourcity,” he said.

Ms Fotyga also urged citymayor Pawe∏ Adamowicz toagree to a commemorative actfor Anna Walentynowicz, a

founding member of the Soli-darity trade union, who alsodied in the Smolensk disaster.

Ms Fotyga said that plans toerect a plaque outside MsWalentynowicz’s former homewere insufficient and that oneof the city’s streets should benamed after her.

The mayor of Gdaƒsk’sspokesperson, Antoni Pawlak,

said Mr Adamowicz was notagainst the plans but that thiswas a grassroots issue. MrPawlak added that councilorshad previously agreed that thebest place to remember thevictims of the Smolensk disas-ter who had a connection withGdaƒsk would be the formershipyard, after it undergoesredevelopment. David Ingham

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Mr Tusk is “playing it tougher” with Paris and Berlin

JANUARY 23-29, 2012NEWS4

Poland and

China forge

closer trade

ties The Pomeranian Special

Economic Zone (PSEZ) has

signed an agreement with

Chen Honghui, the deputy

mayor of the city of Zhuhai

in Guangdong province,

China, to develop a

partnership between the

ports of Gdaƒsk and

Gdynia and the Chinese

port of Gaolan. “We are

opening two gates,”

Teresa Kamiƒska, the

president of the

management board at

PSEZ, told Puls Biznesu.

Foreign invest-

ments create

automotive

jobs

In 2012, the automotive

sector is expected to be

the industry in Poland

which receives the

largest amount of foreign

investment, according to

the Polish Information

and Foreign Investment

Agency (PAIiIZ). In mid-

January, PAIiIZ was

processing 29 automotive

investments worth a total

of more than z∏.1.9

billion. ●

www.wbj.pl

Ratings agencies

More downgrades, more problemsAs ratings agenciescontinue to downgradeEuropean sovereigndebt, calls are againemerging for aEuropean alternative

Ratings agency Standard &Poor’s last week downgradedits long-term credit rating ofthe European Financial Stabil-ity Facility (EFSF), the organestablished by the EU to helpbail out troubled euro-zoneeconomies.

The move brought theEFSF’s rating down to AA+from AAA and follows theagency’s downgrade of Franceand Austria’s long-term creditrating from AAA to AA+ onJanuary 13. S&P said the moveto lower the EFSF’s rating fol-lowed from the downgrade ofits guarantor countries.

“The EFSF’s obligationsare no longer fully supportedeither by guarantees fromEFSF members rated ‘AAA’ byStandard & Poor’s, or by ‘AAA’rated securities,” the agencysaid in a statement, adding,“We consider that creditenhancements sufficient to off-set what we view as thereduced creditworthiness of

guarantors are currently not inplace.”

Market reaction in Polandwas muted. On Monday, theday the move was announced,the Warsaw Stock Exchange’smain index, the WIG, endedup 0.62 percent.

In a statement following thedecision, the EFSF noted thatit retained the highest creditrating from both Moody’s(Aaa) and Fitch (AAA). Itadded that S&P’s downgradewould not affect lending capac-ity, and pointed out that itsshort-term rating remained atS&P’s top level.

“The downgrade to ‘AA+’by only one credit agency willnot reduce EFSF’s lendingcapacity of €440 billion,” saidEFSF CEO Klaus Regling.

“EFSF has sufficient meansto fulfill its commitmentsunder current and potentialfuture adjustment programsuntil the ESM [European Sta-bility Mechanism] becomesoperational in July 2012,” headded.

Calls for a ‘European’agencyNevertheless, the recent down-grades have spurred renewedcalls for a “European” rating

agency that ostensibly wouldbe more independent than the“Big Three” credit-ratingagencies, Moody’s, Fitch andS&P. Moody’s and S&P’s par-ent companies are both head-quartered in New York, whileFitch’s parent company,FIMALAC, is headquarteredin Paris.

German Foreign MinisterGuido Westerwelle said Sun-day that the time had come forEurope to create independentcredit ratings agencies.

“It is time for Europe toprove capable of facing up tothe credit ratings agencies,”Mr Westerwelle told reporters.“The markets are barely giventime to breathe,” before theratings agencies’ decisions arethrown back into uncertainty,he said.

“It is very important we givethe agreements and pacts arealistic chance. … This is theonly way we can bring trustback into the markets,” addedMr Westerwelle.

Michael Meister, a lawmak-er from Germany’s ChristianDemocratic Union, said newlegislation should be put inplace that would require banksand insurers to provide theirown ratings on their invest-

ments instead of relying on rat-ing agencies.

“We as politicians shouldput ourselves less into thehands of rating agencies,” MrMeister told reporters on Jan-uary 14. “We as lawmakersshould in the future refer lessto ratings and ask the individ-ual financial players to providemore ratings of their own.”

Analysts reacted skeptical-ly, however.

“The importance and repu-tation of the main rating agen-cies have diminished as theyare responsible for some badcalls made in the last few

years,” said Adam Narczewski,managing director of XTBHungary.

“Creating new, ‘European’rating agencies might onlyworsen the situation, allowingmore institutions to rate debt,”he added. “If that happens, Isee ‘Europe’ and the ‘US’ com-peting with each other to provewhich one is worse. … But itcould be an ugly fight. Themore rating agencies, the lessdeciding power they have. Atthe same time, they can causemore confusion with their deci-sions.”

Andrew Kureth

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Germany’s FM Guido Westerwelle said Europe should

face up to ratings agencies

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JANUARY 23-29, 2012 BUSINESS www.wbj.pl 5

The retailer is lookingto tighten its grip onthe discount grocerymarket top spot

Biedronka, the largest groceryretail network in Poland, plansto spend z∏.2 billion on expan-sion and brand developmentthis year with a series of invest-ments that will include theopening of at least 200 newstores.

The no-frills retail network,which belongs to Portuguesegroup Jeronimo Martins, oper-ated 1,873 stores at the end of2011, but wants to increase thatnumber to 3,000 in 2015. It alsoplans to launch a revampedlogo and to introduce new lay-outs in many of its outlets.

Poland has a relatively lowdensity of grocery stores, offer-ing 97 sqm of supermarket anddiscount store space per 1,000

inhabitants in 2011, accordingto Planet Retail data. That’scompared to 285 sqm in neigh-boring Germany.

“It will be easy for Biedron-ka to grow organically inPoland as the retail markethere is far from saturated,” saidTomasz Soko∏owski, an analystat DM BZ WBK.

Biedronka, whose share ofthe Polish grocery marketamounts to around 11 percent,is already far ahead of its near-est competitors and is consid-ered the most active player in amarket that is moving towardsconsolidation.

“Right now people areeconomizing on their food pur-chases, and due to its aggres-sive expansion Biedronka isable to offer cheaper and betterquality goods than most of itsrivals,” said Kamil Szlaga, ananalyst at KBC Securities.

A number of potential rivalswhich would normally have thefinancial clout to vie for the topspot have recorded disappoint-ing figures in their home mar-kets recently, limiting their abil-ity to invest in foreign marketssuch as Poland.

“The UK’s Tesco andFrance’s Carrefour have hugeproblems in their home mar-kets which will limit their abilityto compete against Biedronkain the Polish market,” said BZWBK’s Mr Soko∏owski.

While Biedronka, which has90 percent brand recognition inPoland and saw sales at itsstores rise 20.4 percent to €5.8billion last year, is able to groworganically, its potential toacquire other retail holdings islikely to be limited by the com-petition watchdog, which iswary of its dominant marketposition, the analysts said.

They added that this rulesout the possibility of it buyingthe retail arm of FMCG firmEmperia, which is being sold bythat company for around z∏.900million. The sale is expected tobe completed by the end of

March, after which many ana-lysts expect Emperia to shutterits operations. Private equityfunds are considered the mostlikely to snap up Emperia’sretail assets.

Gareth Price

Retail

Biedronka to spend z∏.2 billion on expansion, image building

Entrepreneurship

European Commission: Poland’s SMEs face hurdlesSMEs face an uphillbattle with bureaucracyand government policy,says the EC

Entrepreneurship is generallydeveloping in Poland, butthere are plenty of hurdlesalong the way – more so thanin the rest of the EuropeanUnion, according to a recentreport from the EuropeanCommission.

Almost half of Poland’s non-entrepreneurs say they wouldprefer self-employment over atraditional career if given thechoice, and more than a thirdbelieve it is feasible to becomean entrepreneur.

Nevertheless, only a smallnumber of those surveyed – 10percent – actually have anyintention to start a business.

Still, the small and medium-sized enterprise (SME) sectorholds strong potential forimproving the country’s labormarket. According to the EC,approximately 85 percent of netnew jobs in the EU between2002 and 2010 were created bySMEs. In 2010 alone, 20.8 mil-lion SMEs provided employ-ment for close to 87 million peo-ple in the European Union.

In Poland, the cost andlength of time it takes to start abusiness are just some of theroadblocks that make it harder

to do business in Poland. Com-pared to the EU average, “itcurrently takes twice as long andit is three times more expensiveto start a company in Polandthan in the EU,” the report says.

Property transfers, whichrequire approximately 152 daysin Poland compared to 34 in theEU, present another significanthindrance, said the report. Italso cited Poland’s burdensometax administration system.

Polish entrepreneurs also failto take advantage of e-com-merce opportunities, with only 7percent of Polish businesses –compared to 13 percent ofSMEs in the EU on average –selling their goods and services

online. Business activity is alsotoo limited to the domestic mar-ket, with few Polish entrepre-neurs active outside Poland’sborders.

Innovation neededInnovation, largely lackingamong Polish enterprises, hassome support from the govern-ment, with new programsaimed at improving conditions.Legal changes, which cameinto effect in May 2011, nowprovide business owners incen-tive to implement new technol-ogy with an “innovationbonus” that is worth up to 70percent of the costs incurred,the report pointed out.

Entrepreneurship is increas-ingly helping to improveemployment prospects, espe-cially in the face of tougher eco-nomic times, making it all themore urgent for Poland to elim-inate its obstacles.

“We see small enterprisesdelivering and confirming theirrole as main generators of newjobs,” said Antonio Tajani, vicepresident of the EuropeanCommission responsible forindustry and entrepreneurship.“Their significant share in jobcreation highlights the greaterthan ever economic relevance ofSMEs and the need to supportthem at all levels.”

Ella Pa∏ka

0

50

100

150

200

250

300

PolandPortugalSpainFranceGermany

285

222

166

133

97

Space for growthSupermarkets and discount stores (sqm per 1,000 inhabitants in 2011)

Source: Planet Retail

ExxonMobil owns anumber of concessionswhere large volumes ofthe fuel may lie,preliminary maps showGeologists have mapped outareas in the north and east ofPoland where they think signif-icant deposits of shale oil maylie.

The potential volume ofthe resource, which is a substi-tute for crude oil, is being ana-lyzed jointly by geologistsfrom the Polish GeologicalInstitute (PGI) and the USGeological Survey, both of

which are focusing on areas inthe Lubelskie, Mazowieckieand Warmiƒsko-Mazurskievoivodships. The results oftheir study are due to be pub-lished by the end of the firstquarter.

Preliminary shale-oil de-posit maps drawn-up by theresearchers suggest that thelargest deposits may be foundin areas near Warsaw, Elblàgand Radom, mainly on conces-sion areas belonging to UScompany ExxonMobil.

Shale oil production is simi-lar in complexity and cost to theextraction of shale gas. The fuel

is released as a petroleum-likeliquid when oil shale rock con-taining kerogen is heated usingchemicals.

Given the current highprice of crude oil and Poland’sheavy dependence on Russianoil, the discovery of major vol-umes of shale oil beneathPoland’s surface would be asignificant boon to the coun-try. However, with PGI’sanalysis being one of the firstmajor studies into potentialvolumes, concrete forecastsare scarce.

“As far as the potential vol-umes of shale oil goes, it is still

too early to say,” said ¸ukaszCioch, general director of theCentre for Energy Studies atTischner European University.

However, he said, despitethe huge cost of exploration inEurope and the investmentrisks, investors are approachingthe search with “cautious opti-mism.”

“Drawing on experiencefrom the US, we know that it isnot profitable when it comes toa given area to focus on shalegas alone – a combination ofdifferent identification meth-ods are also being used to iden-tify the correct kind of shale

rock for shale oil extraction,”Mr Cioch added.

The news of the potentialfor shale-oil extraction came ina week when Bulgariaannounced that it was banninghydraulic fracturing, a tech-nique used in the explorationand extraction of shale oil andgas. The decision was made bythe Bulgarian government dueto environmental concernsover hydraulic fracturing. Itmakes Bulgaria the secondcountry in Europe afterFrance to have banned thepractice.

Gareth Price

Unconventional fuel

Evidence of shale oil surfaces in Poland

PGNiG cutting

investments Polish gas monopoly

PGNiG has brought a halt

to all of its new

investment projects in

response to the Energy

Regulatory Agency’s

prolonging of the

procedure to raise gas

tariffs. Vice president

Miros∏aw Szka∏uba said

that the lack of a new,

higher tariff is hurting

the company, Parkiet

reported.

Tusk:

fuel prices

‘disastrous’ Polish Prime Minister

Donald Tusk told

reporters on Wednesday

that in order to stop the

rise in gasoline prices in

Poland, the z∏oty would

have to maintain a certain

exchange rate,

particularly against the

US dollar. Mr Tusk stated

that rising fuel prices are

a “fairly disastrous

coincidence for

consumers” created by

an unfavorable exchange

rate, high oil prices, and

the need for an excise tax

that met the level set by

the EU.

Kraków to

launch PPP

tenders Kraków is preparing 12

public-private

partnership (PPP) project

tenders whose value

amounts to just over

z∏.700 million. Referring

to the planning, building

and management of

multifamily residential

buildings worth z∏.92

million, Przemys∏aw

Chwa∏a from the city’s

authorities told Puls

Biznesu, “We’re hoping

that we will sign our first

contracts by the end of

the year.” City

spokesperson Joanna

Dubiel said, “We will

probably announce the

tender in mid-February.”

Tauron’s

z∏.632 million

wind farm Tauron, one of the

leading energy suppliers

in Poland, has signed a

z∏.632 million contract

with the energy company

Iberdrola for the

construction of an

82 MW wind farm in

Marszewo,

Zachodniopomorskie

voivodship. The

investment is expected

to be completed within

20 months, the company

said in a statement. ●

JANUARY 23-29, 2012BUSINESS6 www.wbj.pl

Insurance

KBC sells Warta in €770 million deal to Germany’s TalanxThe deal results fromKBC’s agreement withthe EuropeanCommission to repayBelgian state aid

Last Friday German insurerTalanx announced that ithad agreed to buy BelgianKBC Group’s Polish insur-ance unit TUiR Warta for€770 million.

The transaction is expectedto be finalized in the secondhalf of 2012, following regula-tory approval.

Once the transaction is

completed, Talanx will be thesecond-largest insurance gro-up in Poland, according to Pol-ish Financial Supervision Au-thority data.

Herbert Haas, CEO ofTalanx Group, said in a state-ment, “We plan to invest fur-ther in the business, maintain-ing each of the subsidiariesand further improving theservice and product offering tothe clients.”

Jan Vanhevel, KBC GroupCEO, said, “Even in anextremely challenging macro-economic environment and invery volatile market circum-

stances, we have succeeded in... obtaining an attractiveprice.”

KBC was given €7 billion instate aid from the Belgian gov-ernment during the financialcrisis and has agreed with theEuropean Commission todivest assets in order to paythe money back. To this end, itis selling Polish lender KredytBank as well as Warta.

For the first three quartersof 2011, Warta recorded a netprofit of z∏.164 million. Theinsurer has around 1.5 millionclients on its books and has anespecially strong market posi-

tion in marine and aviationinsurance.

Talanx, Germany’s third-largest insurance firm, is not anewcomer to the Polish mar-ket, having been operating inthe country through HDIAsekuracja TU and HDI-Ger-ling Zycie TU, which work inthe motor, general liability,property and life insurancemarkets.

Earlier in the week, it hadbeen reported that KBC wasextending its deadline for bids,after receiving offers that didnot meet its expectations.

Gareth Price

The global economy

World Bank: prepare for downturn

The World Bank has signifi-cantly cut its growth forecastsfor both the developed anddeveloping worlds in 2012,warning that there is a signif-icant chance of a global eco-nomic downturn.

In a report released lastweek, the World Bank said itpredicts global economicgrowth of just 2.5 percent in2012 and 3.1 percent in 2013,

compared to the 3.6 percentgrowth previously predictedfor both years.

In 2012, the euro-zoneregion, which may already bein recession, is expected toregister negative growth ofsome 0.3 percent, the reportsaid.

Risks from abroadWhen it comes to Poland, the

main economic risks willcome from abroad, AndrewBurns, the report’s author,said at a press conference.He pointed out that importsinto the EU have dropped 17percent since August.

Mr Burns also said theeuro-zone “contagion” wasalready visible in emergingeconomies that had beenwaxing strong before Augustlast year.

He added that developingcountries are particularly atrisk and that a significantdownturn now would be

potentially more dangerousto them than the 2008-2009crisis had been. Many devel-oping countries currentlyhave reduced fiscal space,with short and long-termdebt maturing in 2012.Demand for exports isexpected to weaken, com-modity prices to fall andremittances to continueshrinking.

The World Bank has low-ered its 2012 growth predic-tions for developing nationsfrom 6.2 percent to 5.4 per-cent, while Poland itself is

expected to grow between 2.5and 2.9 percent.

“The downturn in Europeand weaker growth in devel-oping countries raises therisk that the two develop-ments reinforce one another,resulting in an even weakeroutcome,” the World Banksaid in the report.

When asked by WBJ whatsteps needed to be taken inorder to improve the globaleconomic picture, Mr Burnsreplied that actions currentlybeing undertaken are “theway to go.” Specifically, he

said governments shouldwork on fiscal consolidation,the creation of institutionalstructures to support thebanking system and increas-ing the liquidity of the Euro-pean Central Bank.

Mr Burns added thatdeveloping countries need toprepare for the possibility ofa significant downturn, thatthey need to stress test theirdomestic banking sector andidentify new long-term driv-ers of growth.

David Ingham, Remi Adekoya

CO

UR

TE

SY O

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IKIM

ED

IA C

OM

MO

NS

KBC headquarters, Antwerp, Belgium

Prepaid services

Edenred’s employee gift benefits growing in Poland

Ella Pa∏ka: What services doyou provide in Poland?Vianney du Parc: We designand deliver solutions to makethe lives of employers andemployees easier. In Poland,the market of employee bene-fits is very strong thanks to theSocial Fund to which mostcompanies with 20 employeesor more contribute to. Todaywe have gift solutions – giftcards and gift vouchers –which answer to Poland’sstrong tradition of companiesgiving gifts to employees atChristmas or Easter time.

Are gift cards your most popular product in Poland?This is the most popular one,but we also have a very fast-growing product called TicketRestaurant which is a mealsolution. It has a very advanta-geous tax scheme for compa-

nies which can provide theiremployees with a z∏.190allowance per month, which istotally social-charge free foremployers and employees. It’snot well-known in Poland butwe can see it’s growing quickly.

Recently, we launchedMeal Cards which we reloadat the client’s convenience.This avoids the administrativeburden of vouchers and offersgreater choice thanks to ourpartnership with MasterCard,which gives access to a net-work of around 50,000 restau-rants and food establish-ments.

Who are your biggest clients?Confidentiality is part of thedeal, but I can tell you that wehave won some major publictenders and some prestigiousinternational companies, espe-cially in the telecoms and

Vianney du Parc, managing director of EdenredPoland, talks to WBJ about the company’sproducts and services, and the ways prepaidservices can save businesses money and instillloyalty in their employees

finance sectors. Most of theinternational companies ser-ved by Edenred in other coun-tries are interested in workingwith us in Poland. But we werealso able to attract some Polishcompanies, very big ones andSMEs.

Are you going after specificindustries or sectors inPoland? There is no specific sector,they are all interesting, but onthe meal solution there is spe-cial prevention legislation foremployees who work in diffi-cult conditions where theemployer is obliged to provideemployees with a meal solu-tion … and this is a market weare attacking strongly becausewe are convinced it’s mucheasier for employers andemployees to get a meal cardthan to organize the deliveryof sandwiches or a meal from acanteen.

When did you notice thatdemand for your services wasstarting to rise? Was it

because of the crisis?It’s booming for two reasons.First, because we started toadvertise and inform the mar-ket. Second, the uncertain eco-nomic context is pushing com-panies to optimize everythingthey can, including their taxschemes and rewards foremployees.

Do you plan to bring the vari-ety of the services you offer inother countries into Poland?And what growth prospects doyou see here in the future?Our strategy is to assess theopportunity, to roll out ourexisting solutions in the 40countries we operate. But itneeds some adaptation torespond properly to marketexpectations.

Growth will be mainly onthe ticket restaurant, it willbe our main driver and thegift card will for sure con-tribute. Finally, we are goingto launch new productswhich should be very success-ful if we believe in marketsurveys and in our intuition.

Poland is a fantastic prospectfor Edenred. It is the largestcountry in Central Europe,with more than 38 million cit-izens and a resilient econo-my. This enthusiastic marketis expecting a digital transi-tion and we have good solu-tions for it.

Do you plan to expand furthereast of Poland?Russia, Belarus and Ukraineare on the horizon, but thesemarkets are more complicat-ed because services foremployee benefits takelonger for these governmentsto understand. ●

This year will be a true test for both developedand developing economies as the euro-zone“contagion” could spread even further,according to the World Bank

We offer rooms with all of the most modern creature com-forts: WiFi, minibar, satellite TV, and bathrooms with all the

amenities. There's a pool, too.

For more information, visit www.tuscanyrural.com,or call us at +39 056 456 7488

Enjoy Tuscanyas the natives do!

We also offer delicious Tuscan cuisine and wines!

JANUARY 23-29, 2012 FINANCE & ECONOMICS www.wbj.pl 7

Banking

CEE banks amongworld’s most solventBut the threat ofWestern parentcompanies withdrawingcapital from the regionlooms largeThe capital adequacy ratios ofbanks in Central and EasternEurope are expected to beamong the highest in the worldfollowing the implementationof the Basel III internationalcapital reserve requirements.

The Boston ConsultingGroup (BCG) researched 145financial institutions globally toevaluate the likely effects ofthe regulations, which arebeing implemented to reducethe dangers posed to the widereconomy by banks’ excessiverisk-taking.

Under the requirements,banks are obliged to increasethe amount of capital they holdagainst their losses in order toreduce the amount of moneyon their balance sheets andtherefore their ability to takelarge risks. They have until 2019

to implement the changes. After the rules have been

fully implemented, BCGexpects CEE banks’ aggregatecapital adequacy ratios toshrink by around 2.6 percent-age points, but still remain at arelatively healthy 11.4 percent.This is the highest level in theworld, alongside Nordic banks.

According to the consultan-cy, CEE banks’ healthy condi-tion results from strong regula-tory policies implemented bygovernments in the region.

In Poland, aggregate bank-ing sector earnings in the lastthree years exceeded z∏.35 bil-lion, but at the request of theFinancial Supervision Authori-ty, most of that money was notpaid out as dividends, therebyboosting banks’ capital hold-ings and reducing incentivesfor risk-taking.

Emergency fundingNevertheless, despite thestrong outlook for CEE banks’solvency ratios, the Vienna

Initiative group of regulatorsand policy makers said in astatement last week that inter-national lenders like the IMFshould “stand ready to provideexternal assistance and finan-cial support to banks” inEastern Europe.

The risk of “excessive anddisorderly deleveraging [ofWestern parent companies] aswell as a credit crunch” loomsover Eastern Europe, theysaid.

However, in Poland, whosebanking sector is around 70percent foreign-owned, a large-scale injection of internationalcash would only be required ifthe situation were to deterio-rate significantly, said MarcinMaterna, an analyst at Millen-nium Dom Maklerski.

“Financing Polish banksis profitable. Owners havecontrol, so for them theinvestment is more securethan many other alternativesright now,” he said.

Gareth Price

Labor market

Employers ‘starting to cut’ jobs as slowdown loomsSlowing growth inwages and employmentis evidence of firmspreparing for toughertimesThe H2 2011 trend of gradual-ly falling monthly employmentlevels and moderate wagegrowth was evident in the finalmonth of last year, indicatingthat employers are continuingto respond preemptively to anexpected economic downturn.

Private-sector employmentfell by 0.2 percent on themonth, dragging the annualrate of growth down to 2.3 per-cent from 2.4 percent themonth before.

“We may assume thatenterprises – taking intoaccount the coming economicslowdown in Poland andabroad – started to cut employ-ment,” Bank Zachodni WBKanalysts wrote in a marketreport.

Analysts expect that, for theforeseeable future, Decemberwill be the final month in which

employment grows above anannualized 2 percent.

Wages in the private sector,meanwhile, grew by a below-forecast 4.4 percent year-on-year in December, comparedto consumer price inflation of4.6 percent in the same month.In m/m terms, wages grew by 9percent, mainly due to thepayment of bonuses, to standat z∏.4,015.37.

“These data are still sup-

portive for consumerdemand,” BZ WBK wrote.

Despite this, prospects forthe labor market in 2012 arenot optimistic, given theexpected continued cooling ofdemand from Poland’s mainEuropean trading partners.

“We expect stagnation ofemployment and clear decel-eration of wages to the level ofannual CPI,” BZ WBK wrote.

Gareth Price

Z∏oty rises as Hungary’s Orbanrelents under pressure from EUThe z∏oty strengthened lastweek, gaining ground againstthe euro after it seemed morelikely that Hungary wouldreceive an international bai-lout.

Hungary’s currency, theforint, had been hit hard inrecent weeks as its govern-ment showed recalcitrance inthe face of EU demands that it

back down from some of themore authoritarian elementsin recent legislation in returnfor financial assistance.

However, last week Hun-garian Prime Minister ViktorOrban told the Bild newspaperthat his country was ready tocomply with some of the EU’srequirements. Markets react-ed positively, with the forint

rising 1 percent against theeuro.

While Poland’s economicperformance has differed sig-nificantly from Hungary’s,some big international in-vestors still tend to group thez∏oty together with the forint.

“If the forint advances, thesame happens to the z∏oty,”Joanna Bachert, an analyst at

PKO Bank Polski in Warsaw,was quoted by Bloomberg assaying. “While most people onthe market don’t put the twocountries in the same basket,the biggest global banks do.”

Last Friday, the z∏oty wastrading as low as z∏.4.3026 tothe euro, its strongest showingin nearly three months.

AK

3,000

3,500

4,000

4,500

December

2011

November

2011

October

2011

Septem

ber 20

11

August

2011

July 20

11

June 2

011

May 20

11

April 2

011

March 2

011

Februa

ry 2011

Januar

y 2011

December

2010

Earnings reportAverage gross wage in private sector (z∏.)

Source: Central Statistical Office

CO

UR

TE

SY O

F T

HE

EU

RO

PE

AN

PA

RL

IAM

EN

T

Mr Orban said Hungary was ready to comply with

some EU requirements

JANUARY 23-29, 20128 www.wbj.pl INTERVIEW

Civic Platform

New term, new challenges

Ewa Boniecka: Since PrimeMinister Donald Tusk’s pres-entation of his plannedreforms, the government hasfound itself on the defensive,particularly in relation to thecurrent prescription-drug lawcrisis. How do you assess thesituation?Rafa∏ Grupiƒski: I think thissituation will be resolved inthe near future and the well-being of patients will beassured. The most importantthing is that the list of reim-bursable medicines will beperiodically modified accord-ing to particular needs. Iregret that this unfortunatecrisis has brought worry topatients, but I believe thatnow the most important thingis the need to calm emotionsamong all the parties involvedand to make a joint effort toensure that the health-caresystem works efficiently.

According to the prime minis-ter, the first batch of majorreforms should be presentedto the Polish parliament laterin January, yet it now looks asif some of them could bedelayed. What is your view onthis?So far everything is goingaccording to plan and the firstprojects will be presented inJanuary, after social consulta-tions have taken place. Forexample, consultations aboutthe proposed reforms to theretirement age for people inthe uniformed service are cur-rently taking place. As a result,people entering services suchas the police force, fire service,military and prison service,after the draft bill is accepted,would have to work for 25 years– 10 years more than now, andwould retire at the age of 55.

Also in January, the pro-posals for prolonging the

working age for men andwomen to 67 and changes inhealth-care payments forfarmers should be presentedto the Sejm.

In the first quarter of thisyear other projects willinclude: dealing with changesin pro-family tax benefits, liq-uidation of benefits for new-born children of rich familiesand a new mineral tax.

Your coalition partner, thePolish People’s Party (PSL),is against PO’s proposal ofprolonging the retirement ageto 67, especially for women,and is also opposed to pro-posed changes to KRUS (thesocial insurance system forfarmers). As a result, do youexpect Civic Platform to haveproblems passing the plannedlegislation in parliament?I have already discussed somedetails of our proposals withPSL’s parliamentary causus,while they will also be discussedwithin the coalition govern-ment. … However, I am certainthat PO and PSL will be able tofind some compromises indealing with the details of thegovernment’s proposals.

Some of the proposed reformswill be difficult for certaingroups within society, espe-cially those who are less afflu-ent. With rising food andelectricity prices, as well aspublic spending cuts, the gov-ernment may be a target forcriticism. How do you viewthis playing itself out?We are not trying to concealdifficult problems, but we have

in mind some principles ofsocial justice to protect thepoorest groups. I want to pointout that the biographies of themajority of PO’s parliamen-tary causus attest to our activi-ty in the Solidarity trade unionmovement, and so we under-stand peoples’ needs andsocial rights.

I also see that during thepresent crisis there is an evolu-tion in the approach to socialproblems from Donald Tusk,so I would say that without slo-gans or bold statements the

government of PO and PSL isconducting a just and well-bal-anced social policy, supportedby all our members in parlia-ment.

Do you envisage the possibili-ty that some of the reformscould face protest from cer-tain groups of society?I think that generally Polesare aware of the impact of

the European crisis onPoland, which means theyare ready to accept the needfor social and economicreforms. So far the greatestcontroversy is related to ourproposals for prolonging theretirement age, and herethere could be strong opposi-tion from trade unions.

Many people do not look atit as a way to secure retirementbenefits for future genera-tions, they only think about thehere and now. On the otherhand the younger generations

Rafa∏ Grupiƒski, the chairman of CivicPlatform’s (PO) parliamentary caucus, talks toWBJ about his party’s parliamentary strategy,legislative priorities and his views on thecurrent political and economic situation inPoland

“This struggle will go on ... I do not see a bright spot on the horizon”

State to benefit

from KGHM

vote?

Shareholders in Polish

state-controlled copper

giant KGHM voted last

week against the buyback

plan proposed by the

company’s management

board in mid-November.

Analysts say the state

voted as it did to ensure

that the entity remains a

cash cow for Warsaw,

FT.com reported. The

government needs

revenue from the miner’s

large dividends – expected

at z∏.3 billion this year –

and from a proposed

metals extraction tax to

help it lower the budget

deficit and public debt.

Contraceptive

sales down

Poles are buying fewer

contraceptive aids,

according to data

obtained by ACNielsen

and IMS Health. Between

November 2010 and

October 2011, condom

sales in Poland fell by

10%, with hormonal

contraceptive sales

falling by 3.2%, reported

Puls Biznesu. ●

Katarzyna Zwierz-WilkockaAttorney at law

Collective redundancy procedureLegal Forum

Due to potentially unfavorable eco-nomic conditions, a number of Pol-ish companies may in the future beforced to adjust and reduce theirbusiness operations and conductrestructuring processes. In practice,a restructuring most often means areduction in employment, whichusually assumes the form of a col-lective redundancy.

A collective redundancy takesplace when an employer whoemploys 20 or more persons dis-misses a specific number ofemployees within a period of 30days. This number varies dependingon the total number of workersemployed at a particular organiza-tion (in either the public or privatesector) and amounts to respective-ly: (i) 10 employees if the employeremploys fewer than 100 persons;(ii) 10 percent of employees if theemployer employs from 100 to 299,or (iii) 30 employees if the employeremploys at least 300.

Furthermore, a collective redun-dancy should be carried out for rea-sons that are not related to employ-ees per se, such as liquidation of a

workplace, reorganization, techno-logical changes, a bad financial situ-ation, or liquidation or bankruptcy ofthe employer. In the above-men-tioned circumstances, the Redun-dancy Act of March 2003, whichoutlines the collective redundancyprocedure, shall apply.

Redundancy ActIn case the employer employsfewer than 20 persons or when thenumber of employees who are tobe made redundant is lower thanthe number stipulated in the Redun-dancy Act, only provisions of theLabor Code shall apply. Thus, theemployer is not obliged to conducta collective redundancy procedure.Moreover, the employer is notobliged to pay employees a redun-dancy allowance if they are dis-missed outside of the collectiveredundancy procedure.

The stages of the collectiveredundancy are, in chronologicalorder:1. Negotiations or consultation bythe employer with trade unions or –if there are no trade unions at a

given employer – employees’ repre-sentatives, in order to agree on theconditions of collective redundancyand the rules which govern it. At thisstage the employer is obliged tonotify in writing trade unions oremployees’ representatives aboutthe reasons for redundancy andother information required by theRedundancy Act.2. Notifying the relevant districtlabor office about the planned col-lective redundancy and providing itwith the relevant information speci-fied in the Redundancy Act.3. Concluding with trade unions anarrangement that governs the termsand conditions of the redundancy,or the drawing up by the employerof its own rules to govern the redun-dancy.4. Providing the relevant labor officewith a second notification detailingthe scale of the collective redundan-cies and the nature of the arrange-ments that have been made follow-ing consultations with trade unionsor employee representatives.5. Dismissing individual employ-ees affected by the collective

redundancy by giving them writ-ten notices or executing agree-ments of termination of employ-ment. Notice of employment ter-mination may be given andemployment may – at the earliest– end 30 days after the day thelabor office has been given thesecond notice (stage 4 above).

In general, dismissals under thecollective redundancy procedurefollow the rules applicable to stan-dard dismissals. Thus, the samenotice periods apply, the noticeshould meet specific legal require-ments and the employer shouldissue an employment certificate tothe dismissed employee. The noticeperiod may be unilaterally shortenedby the employer to one month onlyif the reason for the redundancy isthe liquidation or bankruptcy of theemployer.

Apart from the collectiveredundancy procedure, theRedundancy Act provides forsome additional obligations,such as: payment of a dismissalallowance, obligations concern-ing the re-employment of

employees who have beenmade redundant and prohibitionof dismissal of certain groups ofemployees.

In order to execute the collectiveredundancy procedure swiftly andwithin the law, employers shouldpay special attention to legally man-dated deadlines, the correct use ofdocuments, the grounds underwhich they can legitimately makeemployees redundant and the crite-ria they select as reasons for dis-missing employees. These criteriashould be objective so that theemployer does not violate laws pro-hibiting discrimination in employ-ment.

The most important issues thatrelate to collective redundancy arethe timing and execution of arrange-ments with trade unions, or deter-mination of the collective redundan-cy rules with employees’ represen-tatives. If the employer reaches thisstage of the collective redundancyprocedure smoothly, the proceduremay be shortened and the redun-dancies themselves may take placeearlier. ●

Legal Forum is a paid-for module which gives law firms in Poland an opportunity to discuss and inform readers about important developments in the market. The content is created in consultation with Warsaw Business Journal's editorial staff.

JANUARY 23-29, 2012 INTERVIEW www.wbj.pl 9

think only about their presenteconomic situation, so they donot care much about retire-ment reforms.

Nowadays it is necessary toprolong the retirement ageand in my opinion it will leadto a healthier society. But inapproaching the problem ofprolonging the working periodfor women, there is definitely amore conservative approach.Maybe it has some roots in theold tradition of Polish chivalrytowards women, without peo-ple being aware that such anapproach today is anachronis-tic because it lowers women’schances for self-realization.

In your approach to ethicalmatters there are divisionsamong members of PO andPSL. What are your predic-tions regarding parliamentarysupport for the bill for in vitrofertilization and particularlyits financing from the statebudget? There have always been differ-ences in our parties’ approach-es to ethical problems. In thecase of in vitro fertilizationthere were two proposals putforward by our MPs during theprevious parliamentary term.The liberal proposal was pre-pared by Ma∏gorzata Kidawa-B∏oƒska and the conservativeone by Jaros∏aw Gowin.

There were also other pro-posals presented in parlia-ment. A very liberal approachfrom leftist MP Marek Balickiand a total ban proposed byLaw and Justice (PiS) MPBoles∏aw Piecha.

In my opinion, the beststrategy for achieving a com-promise would be to start bydealing with very radical pro-posals, both very liberal andvery conservative ones, andgradually to soften these radi-

cal views and work out a“golden center,” which willmean finding a compromise.But whether it will happen, Icannot predict.

You have taken over PO’s par-liamentary caucus during atime when the coalition has avery small majority in theSejm. Do you think that youwill be able to obtain the sup-port of other parliamentarygroups to push through someof the government’s proposals?I am in talks with members ofother clubs and I think that incertain matters we couldobtain the support of Palikot’sMovement (RP) and theDemocratic Left Alliance(SLD) … but we face aggres-sion and totally negativeopposition from PiS, who arenow additionally competingon a hard right radical frontwith the new rightist parlia-mentary causus, SolidarityPoland.

So the Polish-Polish war willcontinue in parliament?In my opinion we have to beprepared that in the next threeto four years, this parliamentarystruggle will go on, as I do notsee a bright spot on the horizon.There is a sharp confrontationbetween the government andPO on one side and PiS on theother, because PiS has now notonly strengthened its euroskep-tic stance but it has also startedto raise its opposition to Polandadopting the euro.

The chairman of the commis-sion investigating the death ofConstruction Minister Bar-bara Blida, SLD’s RyszardKalisz, concluded thatJaros∏aw Kaczyƒski andZbigniew Ziobro should becalled before a state tribunal

for their alleged politicalresponsibility in connectionto Ms Blida’s death. But MrKalisz claims PO is avoidingthe subject in parliament.What is your response to thisaccusation?We are not hiding from thisissue and a group of PO MPsis dealing with this and intime they will make their con-clusions and present them tothe PO leadership. It is a veryserious political issue, but wethink that the motion pre-sented by Mr Kalisz is toonarrow, related only to MsBlida’s death, so we will alsohave to take into considera-tion the conclusions of otherparliamentary special com-mittees which have investi-gated the issue. And onlyafter analyzing other reportsis it possible to decidewhether there are legallyvalid findings to prepare themotion to bring to trial lead-ing PiS politicians.

Finally, how do you assess thecurrent situation of PO’s par-liamentary caucus?PO’s politicians are on thefront line of Polish politics,fighting to push through diffi-cult reforms, presenting ourEuropean policy at a time ofcrisis in the EU and dealingwith a new situation in Polishpolitics where there are nowfour opposition parties in theSejm.

Our coalition partner,PSL, which has fewer seatsthan before, is also actingmore nervously than duringthe previous term. But I thinkthat PO’s parliamentarygroup is more stable thanbefore and there are fewerinternal divisions, so we arecurrently working quite effi-ciently. ●

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Mr Grupiƒski said the government’s reforms are going according to plan

JANUARY 23-29, 201210 www.wbj.pl OPINION & ANALYSIS

It’s little wonder that the securityof the global oil supply so easilymakes it onto the front pages and

into the headlines. Some 87 millionbarrels of crude oil are consumedevery day, and nearly half of it isshipped, with key maritime routeseither originating in volatile regionsof the globe, or leading through vul-nerable transit chokepoints.

Last year, we were reminded ofthis once the anti-Gaddafi revoltbroke out, and the world market wasleft without some two million barrelsof daily output from Libyan oilfields.This shortfall was quickly made upfor by increased production fromother regions. However, 2012 beganwith mounting tension in the PersianGulf, with Iran threatening to cripple

the flow of nearly one-fifth of theworld’s oil supply by shutting downthe Strait of Hormuz. Growing tur-moil in Nigeria could put evengreater stress on markets.

One of the familiar themes in lightof these and other events has beenincreased talk about increasing theeffectiveness of the way in which oil isconsumed, tapping into new depositsor expanding power generation fromother resources. That was the caseback in the 1970s, when the world’stop consumers and importers of oilwere forced to adapt to the realityshaped by the OPEC-administeredembargo. This time around, arguablythe biggest beneficiary of this mecha-nism has been the so-called “tightoil” member of the unconventionaloil family (see story, p. 5). Throughout2011, upbeat reports have heralded afundamental shift in the balance ofpower on the global oil market, awayfrom producers and in favor of con-sumers and importers, with tight oilplaying the role of the game-changer.

While this may be somewhat toooptimistic, there are good reasons topay attention to tight oil. Its ultimate

potential is still unknown, and esti-mates of reserves are woefullyimprecise – the only preliminary sur-veys were made in the United States,which are said to hold anywherefrom 5 billion to 34 billion barrels ofoil. Granted, that’s not particularlyimpressive given the roughly 230 bil-lion barrels of Saudi oil. However,what has caught the attention ofenergy-market analysts was thedynamics of tight oil production inthe US. According to the Interna-tional Energy Agency, it rosetwofold between 2010 and 2011, andis projected to surge by a further 300percent in the next four years. By2016, it is expected to amount to onequarter of the total domestic pro-duction of oil in the United States.Longer-term forecasts are evenmore bullish.

Oddly familiarBy now, this may sound oddly famil-iar. After all, didn’t America gothrough a similar process a few yearsago, when it took its first stepstowards tapping unconventional gas,most notably shale gas?

Indeed, tight oil is nothing morebut a side-product of the shale revo-lution. Tight oil is crude oil locked inlayers of rock with low permeability,whose porosity needs to be mechani-cally enhanced to allow the resourceto get out. In order to reach it, youneed roughly the same technologythat is necessary to extract shale gas,i.e. horizontal drilling and hydraulicfracking. Tight oil became economi-cal because of advancements in thesetechnologies, and thanks to sustainedhigh oil prices on the world market.

How important a role could tightoil play in the long run? No one canreasonably expect it to make anycountry self-sufficient in terms ofcrude-oil supply, be it the UnitedStates or any other net importer. Forone thing, oil is a global commodity,so the balance of worldwide supplyand demand will continue to affecteveryone. What follows is that no onecan become genuinely insulated fromprice spikes spurred by the instabilityin the Middle East or uncertaintyabout the security of the sea lanes.

Moreover, there probably isn’tenough of the resource to put the

Saudis, the Iraqis or the Venezuelansout of business.

However, while it is still some-thing of an enigma, tight oil is here tostay, especially considering theinevitable increase of global oildemand. The latest World EnergyOutlook, an annual go-to report ofthe IEA, forecasts an increase ofdemand from the current levels to 99million barrels by 2035. Most of this isgoing to be covered by increased pro-duction in the Persian Gulf, especial-ly following the depletion of the lessproductive oil fields, but tight oil isseen as contributing as much as 10million barrels a day.

By that time, it’s unlikely that onlythe United States will be reaching outfor tight oil, which is why these esti-mates could turn out to be too mod-est. If the shale gas revolution hastaught us anything, it’s that whatbegan as a fairly limited operationquickly became a global phenome-non. ●

Bartosz WiÊniewski is a researchfellow at the Polish Institute of International Affairs. pism.pl

Global oil supply and tight oil – much ado about … something?

“While it is stillsomething of anenigma, tight oil ishere to stay”

Bartosz WiÊniewski

Throughout the crisis period,the European Central Bank’sbehavior has been conditioned

by the tension between what it cando and what it is allowed to do.

The ECB is the only institution inthe European Union that is able toprovide unlimited funding to gov-ernments, but its governing statuteprohibits government bailouts.

Nonetheless, the ECB has pro-vided large amounts of liquidity tothe financial system, indirectly soft-ening the pressure on governmentdebt refinancing. For 18 months, ithas been buying government bonds– worth more than €200 billion($254 billion) – on secondary mar-kets under its Securities Market Pro-gram. Moreover, it has providedloans to the banking sector, recentlylaunching a three-year refinancingoperation that generated demandfrom euro-zone banks for €489 bil-lion.

Unlimited supportIn his early December address to theEuropean Parliament, ECB Presi-dent Mario Draghi stressed his com-mitment to unlimited support ofbanks to avert the risk of a creditcrunch. The wall of moneyunleashed by the ECB just beforeChristmas should be seen as a meas-ure matching that commitment.

Mr Draghi left it up to nationalbanks to decide whether to use theliquidity to buy high-yield govern-ment bonds. French President Nico-las Sarkozy and France’s central

bank (a member of theECB) were less timid;they urged Italian andSpanish banks to buytheir governments’debt.

Rational decisionThe political logicbehind such a plea isstraightforward. If thebanks proceed withpurchases of their owngovernment bonds, allpublic debt will be pro-gressively renational-ized, along with loansto the private sector,which undercapitalizedbanks have recentlybeen providing onlylocally.

The so-called“Sarkozy carry trade” isno solution to the sys-temic consequences of asovereign-debt meltdown, but itwould resolve a politically delicatesituation, in which vulnerable euro-zone governments hold foreignbanks in just few countries to ran-som. Greece taught France a lesson.

Worryingly, the evidence so far isthat banks have not used the cash,instead parking it at the ECB. Thebank’s overnight deposit facility rosefrom €250 billion to €400 billion justafter the extraordinary refinancingoperation – and to €480 billion inrecent days. That behavior reflectsbanks’ uncertainty, but leaving the

money with the ECB is a loss-mak-ing operation that cannot be sus-tained indefinitely. Sooner or later,the banks will use the cash. Thequestion is how.

Banks’ immediate interest is toadjust to the new capital require-ments and restore their balancesheets to financial health, whichimplies that they will use the ECBmoney in a way that enables them tomeet this objective most cost-effec-tively. So, for example, if they usethe cash to continue financing theprivate sector, they will ensure that

loans go to creditwor-thy customers.

This means that,like credit provided byItalian and Spanishbanks over the last sev-eral months, most ofthe new cash will belent locally to safehouseholds and largeestablished firms. Thatwill allow bank mar-kets to continue func-tioning, but it isunlikely to inject thetype of stimulus thatEuropean economiesnow require.

Bank buy backThe alternative is theone urged by MrSarkozy and theBanque de France:purchases byEurope’s banks of

their countries’ government bonds.Of course, it is difficult to imaginethat banks will use all of the moneyto buy the same assets that some ofthem have been trying to sell overthe past few months. But that doesnot mean that they won’t buy any ofthem. In fact, some of the €489 bil-lion already has been used for thatpurpose.

This should not come as a sur-prise. Italian and Spanish banks,which received funds from the ECBat a very low rate, can profit greatlyfrom the high yields that their gov-

ernments’ bonds now offer. Theseinvestments can stabilize financingfor governments while strengtheningbanks’ balance sheets.

There is a caveat, though. Bankshave bought only short-term assets,mainly with maturities of aboutthree years (to match their liabilitieswith the ECB). This means thatthere is no appetite for supportinggovernments beyond what the ECBitself is willing to do. More impor-tantly, the ECB is de facto thelender of last resort, while foreignbanking systems are sharply reduc-ing their exposure to risks abroad.

The ECB’s wall of money is likelyto support the real economy onlymildly. By contrast, if banks use themoney now parked at the ECB tocontinue buying short-maturity gov-ernment bonds, that wall of moneywould have a large impact on euro-zone countries’ financial inter-link-ages. Instead of falling on foreignbanks in just a few exposed coun-tries, a default would land mostly onthe ECB’s balance sheet, whose loss-es are distributed to all euro-zonecentral banks – a soft form of debtsocialization that may well preparethe ground for Eurobond-type solu-tions.

Benedicta Marzinotto is a researchfellow at Bruegel and lecturer in

Political Economy at theUniversity of Udine.

Copyright: Project Syndicate,2012.project-syndicate.org

Behind the ECB’s wall of moneyBenedicta Mazinotto

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“The ECB’s wall of money is likely to supportthe real economy only mildly”

Paris and Berlin are working hard to increase Polish euroskepticism

JANUARY 23-29, 2012 OPINION & ANALYSIS www.wbj.pl 11

Remi Adekoya

Itwould be difficult to find agovernment on the continentthat has taken a more pro-EU

stance than Poland’s. Throughout thecountry’s six-month presidency of theEU, Prime Minister Donald Tusk andForeign Minister Rados∏aw Sikorskirepeatedly voiced their commitment

to the 27-nation bloc, saying the solu-tion to the continent’s sovereign-debtcrisis was “more Europe, not less.”

Mr Sikorski even advocated thecreation of a European federationunder the leadership of Germanyduring a much-publicized speech inBerlin last year.

Mr Tusk and Mr Sikorski werecriticized and ridiculed by right-wingpoliticians and media in Poland forbeing ready to give up the country’s

sovereignty in return for nothing buta pat on the back by their “Germanmasters.”

Told you soIndeed, Mr Tusk received lavishpraise from European politicians forhis stance, with the current EuropeanParliament president Martin Schultz(a German) saying the Polish presi-dency was “one of the very best pres-idencies we have had.”

The Polish right, which tends toview praise for Polish politicians bytheir German or French counterpartsas a sure sign that they are not pro-tecting Warsaw’s interests, said MrTusk would get nothing for playingthe nice guy.

When the PM said Poland woulddefinitely join the proposed fiscalpact and contribute to the IMF fundmeant to assist troubled euro-zonecountries, the same critics said he wassilly to sign up for a deal whose con-tent no one knew yet.

But since decisions made at euro-zone summits would affect non-euroEU members, Mr Tusk promised hewould fight for Poland to be allowedto participate (not necessarily vote)

at the meetings. His critics sneered with doubt, and

the eurozone’s decision-makers arenow proving them right. When it wasrevealed by the media last week thatthe latest draft of the fiscal uniontreaty did not envisage non-eurocountries like Poland being allowedto attend euro summits, Mr Tuskadmitted defeat. “You can’t win themall,” he said. “We told you so,” hiscritics gloated.

Most Poles just wondered whyParis and Berlin seemed to want tomarginalize such a staunch ally.

Fighting spiritSince then, it seems Mr Tusk hasregained his fighting spirit, sayingafter a meeting with the Italian PrimeMinister Mario Monti that coopera-tion between Rome and Warsawwould “serve well to complement thepolitical initiatives by Paris and Berlinat a time when the new rules in theEuropean Union are being workedon.”

Even more of an outright chal-lenge to France and Germany werehis words to Italian newspaper Cor-riere della Sera that “Europe should

not be left to two capitals” and he didnot want “exclusive clubs” in the EU.

The latest draft of the treaty nowsays that non-euro nations can attendthe summits once a year. That wouldprobably amount to Poland beinginvited to the summits where noimportant decisions are made.Although Mr Sikorski has said thenegotiations are still ongoing and that“the latest drafts are going in thedirection of Poland’s postulates,” thefinal treaty might still turn out to bean embarrassment for the Polish gov-ernment.

Mr Tusk’s critics now feel vindicat-ed. They say if he had been tougherfrom the beginning, Poland wouldhave gotten all it wanted. That, ofcourse, is nonsense. When the right-wing Law and Justice (PiS) was inpower from 2005-2007, they prac-ticed the kind of politics PO’s criticsare advocating, banging their fists onthe table any time they didn’t gettheir way. What did that get Poland?Precious little.

Once bitten … But it is not surprising that this view isgaining traction, considering the way

German Chancellor Angel Merkeland French President NicolasSarkozy have treated Donald Tusk.

Mr Tusk’s actions seemed perfect-ly reasonable. He showed his inten-tion to join the fiscal union and chipin for the IMF fund, in order to beable to “participate” at euro summits.

But the powers that be – especial-ly France, if reports are correct –seem to think that is asking too much.They have humiliated Mr Tusk, mak-ing him seem naïve and gullible. Thisdebacle will now make the primeminister more wary of Berlin andParis. No strong relationship can bebuilt on mistrust.

What’s the big deal about attend-ing euro summits anyway? Are theresecret, major decisions going to bemade there that Paris doesn’t wantWarsaw to know about? If not, thendoing everything to shut Poland andother non-euro members out of par-ticipating in euro summits doesn’tmake much sense. ●

Remi Adekoya is politics editor of Warsaw Business Journal.

Read his blog “The business of politics” at wbj.pl

To raise Poland’s retirementage or not? Listening tosome of Poland’s politi-

cians debate the issue, it’s as if Polanddidn’t have a huge demographic crisislooming.

Except it does. Poland, like mostother European countries, isn’t pro-ducing enough people to replace theones it has. According to the CIA’sWorld Factbook, it has a negativepopulation growth rate of -0.062 per-cent. There are 1.3 children born toevery woman – it ranks behind Euro-pean colleagues such as Sweden andDenmark, and even CEE countrieslike Hungary and Slovakia on thiscount. China has a one-child policy,and still ranks higher than Poland inboth population growth and fertilityrate.

Poland’s median age is about 37years old and like the rest of the devel-oped world, life expectancies in Polandare increasing. Quite simply, there arevery soon going to be many more peo-ple who are retired, and fewer who willbe working to support them.

The numbers don’t workNow, consider Poland’s finances.While still in better shape than thoseof many other EU countries, theyaren’t inspiring. The deficit for 2011was around 5.6 percent of GDP – farabove what the EU considers “safe”at 3 percent – while Poland just bare-ly managed to keep debt below 55percent of GDP. Trying to support asignificantly higher population ofretirees would unquestionably have anegative effect.

Next, remember the relatively lowpensions that retirees already receive.Poles who retire in the future will beexpecting much more than their par-ents or grandparents are getting now.And because of those longer lifeexpectancies, they’ll be receivingthose higher pension payments forlonger.

While no one wants to be forcedto work for longer than they’d like,there simply is no other choice thanto raise the retirement age. Two addi-tional years (from the age of 65 to 67for men) seems a small price to pay in

order to keep the country from goingbankrupt. Indeed, women will have itslightly tougher under the govern-ment’s plan, with their retirement agegoing up seven years from the age of60 to 67 – but that will be implement-ed over a period 20 years longer thanfor men. The plan seems fair.

Leszek Balcerowicz, a formerfinance minister, central bank gover-nor, and the architect of Poland’spost-communist reforms – and oftena vocal critic of the Tusk government– has praised the reforms.

Non-startersOf course, that hasn’t stopped MrTusk’s political foes from opposingthe plan (see cover story, pp.12-13).The Law and Justice party wants toput its head in the sand, and pretendno changes need to be made. Theflailing leftist party Democratic LeftAlliance wants to hold a referendum.Even the Polish People’s Party – thecoalition partners of Mr Tusk’s CivicPlatform in government – have comeup with an alternative plan. They

would like to see the retirement agefor women reduced by three years forevery child they have.

Not only would this make it hard-er to save money on pension payouts,it raises all sorts of difficult questions:What about single dads who raisetheir children? What about familieswho adopt children? Why shouldonly childbearing women be favoredin this way?

A referendum is also a non-starter. Of course raising theretirement age is unpopular. Butso is cutting other entitlementsand raising taxes. A combinationof all of these will probably have tobe implemented to get Poland’sfinances on the straight-and-nar-row, but none of them would passa referendum. Sometimes, the jobof politicians is to implementunpopular policy for the good ofthe people. California puts manysuch measures to a referendum –look at where it’s got that state’sfinances. The state is currentlyconsidering both budget cuts and

rises in taxes in order to fill a holeof $9 billion.

We can tinker with the specifics.There may be ways to make MrTusk’s plan more politically palatable

while keeping the savings in place –but the core idea is one that Polescannot run away from. The retire-ment age must be raised. Better to doit now than later, when more dracon-ian measures may be necessary. ●

Andrew Kureth is editor-in-chief ofWarsaw Business Journal. Read his

blog “From the editor” on wbj.pl

“Poland isn’tproducing enoughpeople to replacethe ones it has”

“The Polish right saidMr Tusk would getnothing for playingthe nice guy”

A higher retirement age: it’s not a choiceAndrew Kureth

CO-MANAGING EDITOR

GARETH PRICE(GPRICE@WBJ.PL)

CO-MANAGING EDITOR

ALICE TRUDELLE(ATRUDELLE@WBJ.PL)

POLITICS EDITOR

REMI ADEKOYA(RADEKOYA@WBJ.PL)

REAL ESTATE EDITORADAM ZDRODOWSKI(AZDRODOWSKI@WBJ.PL)

COPY EDITORSDAVID INGHAMELLA PA¸KA

INTERNSIZABELA DEPCZYK VERONIKA JOY

CONTRIBUTORSE. BLAKE BERRYEWA BONIECKAMARK ORDONLIAM NOLAN

COLUMNISTSPAUL FOGOJUDITH GLINIECKIADAM NARCZEWSKIANDREW NAWROCKI

PRODUCTION MANAGERPIOTR WYSKOK

GRAPHIC DESIGNER¸UKASZ MAZUREK

CARTOONSPIOTR WYSKOK

MARKETING &SALES

AGNIESZKA BREJWO MARKETING &SALES DIRECTOR(ABREJWO@WBJ.PL)

MAGDALENA KARPI¡SKA(MKARPINSKA@WBJ.PL)

AGNIESZKA KUCZY¡SKA(AKUCZYNSKA@WBJ.PL)

MARTA CZESZEJKO-SOCHACKA(MCZESZEJKO-SOCHACKAKA@WBJ.PL)

KAROL KOSIOREK(KKOSIOREK@WBJ.PL)

PR & MARKETING SPECIALIST NATALIA ROGACZEWSKA(NROGACZEWSKA@WBJ.PL)

SUBSCRIPTIONS MANAGERAGNIESZKA MICHALIK(AMICHALIK@VALKEA.COM)

PRINT & DISTRIBUTION COORDINATORKRZYSZTOF WILI¡SKI(DYSTRYBUCJA@VALKEA.COM)

BOOK OF LISTS SPECIALISTJOANNA RASZKA(JRASZKA@VALKEA.COM)

PUBLISHER VALKEA MEDIA SA EDITOR-IN-CHIEF ANDREW KURETH (AKURETH@WBJ.PL) MANAGING DIRECTOR MONIKA STAWICKA

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.

JANUARY 23-29, 2012COVER STORY12

Production

growth above

expectations

Industrial production in

Poland grew by 7.7% y/y

in December 2011,

according to data from

the country’s Central

Statistical Office (GUS).

This was significantly

higher than the market

consensus of 6.5%.

However, in month-on-

month terms, output

decreased by 4.9%.

Growth of 7.6% y/y was

recorded in mining and

quarrying output, with

the export-oriented

furniture and metals

industries also seeing

particularly strong

growth – of 22.9% and

15.5% respectively.

Polish firms

strong

Despite the turmoil in

the global economy,

Polish businesses

performed strongly in

2011, a study indicates.

According to a report by

research firm D&B

Poland on 300,000

businesses, small

companies employing up

to nine people recorded

the most significant

improvement last year.

Medium-sized companies

improved their rating

by only 3.9% y/y.

However, large

companies enjoyed the

best results, with 67.1%

rated good or very good.

Used-car

sales up

A total of 725,000 used

cars were imported to

Poland last year,

significantly more than

the 280,000 new cars that

were sold in the country

in the same year.

However, the number of

imported second-hand

cars was still lower than

the record 1.1 million

vehicles imported in

2008, reported Dziennik

Gazeta Prawna. As a

result of this high

demand for used vehicles

and a drop in interest in

new vehicles, Polish car

dealers are becoming

increasingly likely to

develop second-hand

sales networks. ●

www.wbj.pl

Pension reform

Proposed pensionreforms unpopular,facing obstaclesWhen Prime Minister DonaldTusk addressed parliament lastNovember setting out his gov-ernment’s plans for the nextfour years, he listed a slew ofreforms he was planning toimplement. None of them,however, raised more contro-versy than his plan to increasethe retirement age in Polandto 67 for both men and

women. Mr Tusk said that Polish

men, who currently retire at65, will have to work two yearslonger, following several incre-mental increases, by 2020.More controversially, women,who can currently retire at 60in Poland, will also have towork until they are 67, albeitby 2040. The gradual increas-

ing of the retirement age isplanned to begin next year.

Although economists havebeen arguing for years thatincreasing the retirement agein Poland is necessary, MrTusk’s announcement stillcame as a surprise to many.The PM is known for playing itsafe, for not risking the ire ofvoters by proposing reformsthat deal with prickly issuessuch as pensions.

A TNS OBOP opinion polltaken after Mr Tusk’s speech

left no doubt as to what Polesthink about the idea: 80 per-cent of those polled said theyopposed an increase of theretirement age.

But Donald Tusk had littlechoice. He needed to make anannouncement that financialmarkets would receive posi-tively. Besides, the problem ofa social security system threat-ened by bankruptcy is onewhich many other Europeancountries are having to face upto as well, due to aging popula-tions across the continent.

Indeed, the painful truththat retirement ages need tobe increased is no longer newselsewhere in Europe. Back in2007, Germany decided toraise its retirement age to 67;Denmark did the same a yearearlier, while the UKannounced in 2010 that its citi-zens will have to work untilthey are 68. Even Italy, anation which prides itself on“working to live, not living towork,” has increased its retire-ment age to 67.

Next month, the EuropeanCommission is due to publisha white paper on pension sys-tems in Europe, in which it willstress the need for countries toraise their retirement ages inorder to meet the twin threatsof unfavorable demographicchanges and the debt crisis.

So what are the chancesthat Mr Tusk will manage toimplement his proposedreforms successfully, and howmuch money will it save?

Road blocksLabor Minister W∏adys∏awKosiniak-Kamysz, who isresponsible for preparing thelegislation, told the media thismonth that the law will beready “very soon … during thiswinter.”

But the government will

have to overcome significantroad blocks before it will beable to pass its proposal. Itscoalition partner, the PolishPeople’s Party (PSL) has comeup with its own proposals, say-ing that for each child awoman has, she should be ableto work three years fewer. So,for example, if a woman hastwo children, she would beable to retire when she is 61years old, according to PSL’sproposal.

Mr Kosyniak-Kamysz, whois himself from PSL, has saidhe “likes” his party’s proposal.This puts the senior coalitionpartner, Mr Tusk’s Civic Plat-form (PO), in a tough spot,since its own coalition partneris now publicly offering analternative reform that wouldalmost certainly be more pop-ular with the public.

The biggest oppositionparty, Law and Justice (PiS),has said it is completelyopposed to increasing theretirement age. It is still notclear yet where Palikot’sMovement (RP), the third-largest party in parliament,stands on the proposal.

Meanwhile, last week theDemocratic Left Alliance(SLD) has called for a referen-dum on the matter, arguingthat on such an importantissue Poles should be able todecide whether the govern-ment’s proposal is to be imple-mented. The move is support-ed by major labor unions suchas Solidarity, which is current-ly attemping to collect the500,000 signatures that areneeded for petitioning parlia-ment to call such a referen-dum.

However, the chances of areferendum on the issue areremote, because a parliamen-tary majority would berequired to sanction one. The

The prime minister has said he wants toincrease the retirement age in Poland, but willhe have the political muscle to make it happen?

Remi Adekoya

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JANUARY 23-29, 2012 COVER STORY www.wbj.pl 13

Paul Fogo is a senior attorney with Miller, Canfield, W. Babicki, A. Chelchowski & Partners.fogo@pl.millercanfield.com

Poland’s

pension system

Legal Eye

Prime Minister Tusk’s gov-ernment has recently calledfor an increase in the retire-ment age to 67 for both menand women, as well as to doaway with most early retire-ment perks reserved for spe-cific professions, such as theuniformed services and min-ers. The current regulationsgenerally permit a maleemployee to collect retire-ment benefits from age 65,while a female employeemay retire five years earlier,at age 60. An increase in theretirement age, argues thePrime Minister, coupled withscrapping the special treat-ment currently afforded tominers, police officers andfarmers, would save thebudget nearly 10 billion zlotyper year.

HistoryThe current discussion overPoland’s retirement systemfollows more than five yearsof legal debate and judicialrulings. On October 23,2007, the Constitutional Tri-bunal declared a portion ofPoland’s retirement systemunconstitutional due to thedifferent treatment of menand women with respect tothe conditions under which aperson could seek earlyretirement and draw a publicpension.

Specifically, the Tribunalobjected to the fact that amale employee had to provea disability to qualify forearly retirement at age 60,while a female employee didnot have to provide evidencefor any disability in order toseek early retirement at age55, finding that the require-ment violated Article 33 ofthe Constitution. The Tri-bunal was careful to avoidruling on the larger issue ofwhether the use of differentretirement ages for men andwomen was itself constitu-tional, and instead limited itsruling to the criteria used inqualifying for early retire-ment.

Three years later, in 2010,the Constitutional Tribunalfinally took up the issue ofwhether the use of differentretirement ages for men andwomen was constitutional.The ruling at the time sur-prised many legal scholars.On July 15, 2010 the Consti-tutional Tribunal upheldPoland’s use of differentstatutory retirement ages formen and women. At the

same time, however, the Tri-bunal issued a press releasestating that the use of twodifferent statutory retire-ment ages for men andwomen, although legal, wasnot an “optimal” solutionand urged the government toeventually equalize theretirement age for bothsexes.

Current retirementsystemPoland’s current retirementsystem is divided into twosystems: Old and New. TheOld System applies to allworkers born before 1949.The New System applies tothose born after. Under theOld System, a male workermay generally retire at age65 following at least 25 yearsof work and a female workermay retire at age 60 follow-ing at least 20 years of work(maternity leave is includedin this calculation).

In many cases the retire-ment age may be lowered.For instance, a female work-er may retire as early as age55 if she has worked for aperiod of 30 years. A maleworker, however, may onlyretire early at age 60 follow-ing 25 years of work and he isdeclared disabled. The Con-stitutional Tribunal foundthis specific conditionunconstitutional in its 2007ruling, but despite the rulingthis provision remains as is.

The New System elimi-nates the option of earlyretirement permitted underthe Old System, but stillmaintains the age of retire-ment for men at 65 and 60for women. Under the NewSystem, the right to collect aretirement benefit is not tiedto the number of yearsworked as under the OldSystem, but rather is deter-mined by the total amount ofcontributions paid into thesystem by each workerthroughout his or her career,in effect creating an incen-tive for each person to worklonger in order to maximizehis or her retirement benefit.

Government proposalThe government’s proposal toincrease the retirement agefor all workers to age 67would appear to be in linewith the Constitutional Tri-bunal’s recommendation forPoland to eventually equalizethe retirement ages for menand women. ●

government’s junior coali-tion partner, while having itsown suggestions, is unlikelyto go as far as to supportsuch a move, which wouldamount to open defiance ofthe prime minister.

But does reducing thenumber of years women haveto work relative to the num-ber of children they havemake economic sense? Someexperts think it’s a pro-activepolicy that gets to the heartof dealing with the loomingdemographic issue.

But Grzegorz Maliszews-ki, chief economist of BankMillennium doesn’t agree.“This would be introducing acomplication to the system.Any exception to the generalrule is not positive, the sim-pler the law, the better,” hesaid.

Mr Maliszewski stressedthat raising the overallretirement age in Poland is amuch-needed move. “Thisreform supports our fiscalconsolidation in the long

term. It also reduces theincreasing of debt andshould bring significantresults,” he added.

The Labor Ministry hassaid that although it expectssavings amounting to hun-dreds of millions of z∏otywithin the first few years ofthe introduction of the pen-sion changes, by 2020 thereforms should have savedthe state over z∏.10 billionand after 2020 it should besaving at least that muchevery year.

More workers, moreunemployment?Piotr Kuczyƒski, chief analystfor the financial advisory firmXelion, wrote on his blog that“it seems obvious that if weincrease the supply of work-ers artificially by increasingthe retirement age while thedemand for work doesn’tchange, then unemploymentmust rise. Also the cost ofwork, meaning our salaries,could drop,” he wrote.

But Kaspar Richter, sen-ior economist for Poland atthe World Bank, disagrees.“We had this argument inthe 1980s. It was believedthen that allowing people toretire earlier would keepunemployment down, well ithasn’t,” he said.

Mr Maliszeswki sharesMr Richter’s view. “Lookingat other countries whichhave increased their retire-ment ages, there is no evi-dence that it increases unem-ployment and even if there issuch an effect, it will only bein the short term,” he said.

Jaros∏aw Janecki, chiefeconomist at SociétéGénérale, meanwhile, be-lieves that from the macro-economic point of view, anynegative effect on the labormarket would be offset to alarger extent by theincreased disposable incomethat senior workers wouldhave, due to them havingremained on the labor mar-ket for longer.

A tough sell, but doablePrime Minister Donald Tuskis almost certainly going tohave a tough time ensuringthat the final piece of legisla-tion remains consistent withthe reforms he suggested inhis November speech. More-over, his popularity is likely todip, at least in the short term.

To win over the hearts andminds of the electorate hewill need to explain moreclearly what the advantagesare of working longer.Employees can spend moreyears earning for their retire-ment, the government willspend less in benefits, andthe budget will be in bettershape. All of this, he willneed to emphasize, shouldhelp the economy to grow.

If he also points out thatother Europeans will even-tually have to follow thesame path, Poles may slowlycome around to the ideathat retiring later might notbe such a terrible thing afterall. ●

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Poland’s looming demographic crisis leaves its policymakers with no choice but to reform the pension system,

experts say

Combining the most in-depth social media knowledge with the sophisticated insights of consumer behavior

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LOKALE IMMOBILIAW 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 l y s u p p l e m e n t o n r e 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 • JANUARY 23-29, 2012, LI 17/03

IKEA buys

landRetailer IKEA has

acquired 2.2 hectares of

land in Opole from retail

developer Helical Poland.

The land is adjacent to

the city’s Turawa Park

40,000-sqm shopping

center and retail park

which was developed by

Helical and was

subsequently sold to

Standard Life

Investments. “We are

very pleased that IKEA

has bought land next to

our shopping center. We

hope that soon a large

IKEA [store] will be

developed here,

reinforcing this part of

Opole as the premier

retail destination,”

Jonathan Tinker,

managing director of

Helical Poland, said in a

statement.

Mokotów Nova

phase II opens

Developer Ghelamco

Poland has finished

construction on the

second of two phases of

its Mokotów Nova office

project in Warsaw,

delivering an additional

15,000 sqm of space to

the capital’s Mokotów

district. The complex is

located on Warsaw’s

ul. Wo∏oska and is, with

its total of 40,000 sqm of

class-A office space, one

of the largest office

developments in that part

of the city. The

investment is expected to

be BREEAM-certified by

the end of Q1 2012. ●

Mixed-use developments

TriGranit secures financing for its largest Polish projectThe company hasofficially launchedconstruction on a newPoznaƒ shoppingcenter scheme

Real estate developer andinvestor TriGranit hasobtained €119 million in bankfinancing from a consortiumof banks comprised of BankZachodni WBK, RaiffeisenBank Polska, Nordea BankPolska, BRE Bank and HYPONOE for its Integrated Trans-port Center in Poznaƒ.

The mixed-use develop-ment, whose total value,including tenants’ investment,will amount to some €250 mil-lion, will comprise a railwaystation, a bus station and ashopping mall. Constructionon the latter structure was offi-cially launched during aground-breaking ceremonylast week.

The investment, which isscheduled for completion inQ4 2013, is being realized in

partnership with Polish StateRailways, which has providedfour hectares of land. TriGran-it is responsible for all devel-

opment activities pertaining tothe construction of thescheme.

“Poland has always been

our flagship destination forproperty development activity.Our investment in Poland hasreached around €1 billion and

the total completed develop-ment area is over 500,000sqm,” TriGranit CEO ÁrpádTörök said in a statement.

He added that in the caseof the Poznaƒ project the com-pany is using the experience intransforming railway stationsinto new city centers that itgained during the develop-ment of schemes includingWestEnd City Center inBudapest.

Hungarian-majority ownedTriGranit was established 15years ago and is currently pres-ent in seven countries in Cen-tral and Eastern Europe. Thecompany’s pipeline includesmixed-use developments val-ued at over €4 billion, as wellas a number of public-privatepartnership investments.

In Poland, TriGranit’s com-pleted projects include the Sile-sia City Center shopping centerin Katowice, the Bonarka CityCenter shopping mall inKraków and the first phase ofthe B4B office project in the lat-ter city. Adam Zdrodowski

Commercialization underway on JózefWojciechowski’s latest commercial projectDTZ is looking for tenantsfor the planned GaleriaJagielloƒska shopping centerproject which JW Wind andJagiellonia Bia∏ystok Spor-towa will construct in theeastern Polish city of Bia∏ys-tok.

JW Wind belongs to Polishbillionaire Józef Wojciechows-ki, who is also the main share-holder in developer and con-tractor JW ConstructionHolding. The firm is the newinvestor in the Galeria Jagiel-loƒska development in whichthe Irish Investment Groupwas originally involved.

After the original investorpulled out, the concept of theplanned mall, which is to belocated between Bia∏ystok’sul. Jurowiecka and ul. Pi∏sud-skiego, was re-assessed.Instead of the previouslyplanned 200 stores, the proj-ect is now expected to hostsome 150 tenants on its 50,000sqm of GLA.

Apart from shoppingopportunities, the investmentwill offer entertainment facili-ties including a multiscreenmovie theater. Part of the rev-enues from the shopping cen-ter’s operations will support

the Jagiellonia Bia∏ystoksports club.

“The planned investmentwill, thanks to its scale andmultifunctional character,become the dominant projectin Bia∏ystok,” Piotr Wasilews-ki, retail spaces team directorat DTZ, said in a statement.

The architectural conceptof the Galeria Jagielloƒskaproject has been provided bythe Chapman Taylor architec-tural firm. Construction onthe mall is scheduled tolaunch in the second half ofthis year.

Adam Zdrodowski

TriGranit in Poznań . . . . . . . . . .15

Galeria Jagiellońska mall . . . . .15

Goodman’s plans . . . . . . . . . . . .16

Plac Unii financing . . . . . . . . . . .16

Budimex builds for PGNiG . . . .16

Galeria Miodowa scheme . . . .16

Property-related stocks . . . . . .16

Warsaw office market . . . . . . .17

CE investment . . . . . . . . . . . . . .17

Arka portfolio sale . . . . . . . . . . .17

PPG in Russia . . . . . . . . . . . . . . .18

New residential schemes . . . .18

In this issue

1716

The Plac Unii mixed-use high-rise project in Warsawhas received financing, a contractor and a key tenant

The portfolio of the Arka BZWBK Fundusz Rynku NieruchomoÊci FIZ propertyfund is up for sale

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Galeria Jagielloƒska will host some 150 tenants

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

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

or

JANUARY 23-29, 2012LOKALE IMMOBILIA – REAL ESTATE16 www.wbj.pl

Goodman to develop 200,000-300,000 sqm of space in 2012Industrial developer Good-man Poland plans to developfrom 200,000-300,000 sqm oflogistics space in 2012. Thetotal value of the investmentsis estimated at approximately€70 million-€120 million.

The new developments willmost likely be held by theGoodman European LogisticsFund (GELF). GELF raised€350 million of capital inDecember and Poland is oneof the investment fund’s targetmarkets.

“One of our main goalsfor 2012 is to build a logistics

park in Upper Silesia which isone of the last regions inPoland where we do not yethave a presence,” B∏a˝ejCiesielczak, Goodman’s co-untry manager for Poland,said in a statement.

He added that the compa-ny will also launch construc-tion and commercialization ofthe Pomeranian LogisticsCentre in Gdaƒsk in the firsthalf of this year. With its targetarea of 500,000 sqm, the proj-ect is Goodman’s largestinvestment in the country.

Moreover, the acquisition

of sites for further projects isbeing planned. “Additionally,we plan to acquire sites withan area of five to 20 hectares[each] where we will be able todevelop up to 100,000 sqm ofwarehouse space,” Mr Ciesiel-czak said.

Currently, the developerhas plots across Poland whichwill enable it to build a totalof some 875,000 sqm of newspace. The two main areas inwhich the company is plan-ning to acquire more land areUpper Silesia and Poznaƒ.

Adam Zdrodowski

PowiÊle Park, a companybelonging to the PGNiG Capi-tal Group, has selected con-struction firm Budimex as thegeneral contractor of an office-retail-residential complex thatwill be built near the intersec-tion of ul. Kruczkowskiego andul. Ksià˝´ca in Warsaw’s cen-tral district.

The value of the agreementamounts to z∏.173 million, with

construction expected tolaunch in the upcoming weeksand finish after 24 months. Thedetails of the investment,including its size and architec-tural design, are to be revealedlater this year.

For now, it is known thatthe planned development,which has been designed by theAPA Kury∏owicz & Associatesstudio, will include a class-A

office building and a complexof residential buildings withupper-standard apartments.

The planned office buildingwill house Mazowiecka Spó∏kaGazownictwa, another compa-ny from the PGNiG CapitalGroup, and will feature mod-ern eco-friendly architecturalsolutions and technologies,PowiÊle Park has revealed.

Adam Zdrodowski

Investment financing

Plac Unii development still ontrack, thanks to bank financing BBI Development hasreceived a €105million loan fromBank Pekao to helppay the contractor

Developers BBI Developmentand Liebrecht & Wood havereceived a €105 million loanfrom Bank Pekao for a special-purpose investment vehicle(SPV). This will enable theSPV to complete payment forthe construction of the third ofthree buildings in the mixed-use Plac Unii development.

Construction of the 90-meter tower, which is locatedon a triangular plot betweenul. Waryƒskiego, ul. Pu∏awskaand ul. Boya ˚eleƒskiego, isset to be completed by Octo-ber 2013. Funding for theentire investment had notbeen settled prior to the devel-opers receiving the loan – theyhad previously only hadenough to pay contractor War-bud until March this year.

“We have the money to payfor Warbud’s construction andto have the project ready byOctober 2013,” said Micha∏Skotnicki, CEO of BBI Devel-opment.

BBI also announced that it

had secured a key tenant tooccupy nine floors in the PlacUnii tower and retail premiseson the ground floor, totalingsome 10,300 sqm. Aspokesperson for BBI wouldnot disclose the name of thetenant when contacted byLokale Immobilia, but said itwas a well-known firm operat-ing in the banking and insur-ance sector.

The completed Plac Uniiproject will consist of threebuildings connected by a glassroof at a height of 30 metersabove the ground. In additionto offering around 40,000 sqmof office space and 16,000 sqmof retail and commercialspace, the development willalso contain restaurants, cafesand various service points.

Veronika Joy

Budimex to build mixed-usecomplex for PGNiG subsidiary

Developer PA Nova hasrecently launched constructionon its Galeria Miodowa shop-ping center in Kluczbork,southwestern Poland. The11,000 sqm investment, theconcept of which was designedby the Vsf Creative architec-tural studio, will feature a sin-gle-level mall and a 4,000 sqmretail park.

“The concept features apredominantly timber andsteel facade to emphasizeboth the modern and naturalattributes of the scheme,”Vsf Creative wrote in a state-ment.

Anchored by a Tesco food

store, the Galeria Miodowamall and retail park will fea-

ture nearly 30 stores, as well asparking for 350 cars. GP

Construction launches on PA

Nova’s Galeria Miodowa mall

Security Closing % change 52-week 52-week % change Total Marketprice (week) low high (year) shares value

on Jan 19 (z∏. mln)

BUDIMEX 78.00 -0.51 64.00 109.20 -22.77 25,530,098 1,991.35

CELTIC 16.51 -1.73 15.55 24.89 -15.33 34,068,252 562.47

DOMDEV 29.54 4.23 23.50 50.80 -37.68 24,560,222 725.51

ECHO 3.80 6.74 3.05 5.55 -18.98 420,000,000 1,596.00

ELBUDOWA 102.00 3.24 87.00 168.60 -39.10 4,747,608 484.26

ENERGOPLD 1.99 -2.45 1.81 4.10 -45.92 70,972,001 141.23

ERBUD 18.55 -4.87 14.65 53.20 -65.71 12,644,169 234.55

GANT 8.18 7.77 5.85 17.00 -52.74 20,499,953 167.69

GTC 8.84 10.64 7.91 21.95 -59.82 219,372,990 1,939.26

HBPOLSKA 0.95 3.26 0.70 2.79 -67.01 210,558,445 200.03

JWCONSTR 6.86 5.54 4.36 15.50 -51.17 54,073,280 370.94

LCCORP 1.01 5.21 0.85 1.69 -32.67 447,558,311 452.03

MARVIPOL 9.13 2.01 7.22 10.09 -10.84 36,923,400 337.11

MIRBUD 2.26 7.11 1.94 4.75 -49.33 75,000,000 169.50

MOSTALWAR 17.11 5.36 15.40 52.70 -68.31 20,000,000 342.20

MOSTALZAB 1.60 13.48 1.07 3.00 -44.25 149,130,538 238.61

ORCOGROUP 15.48 1.98 14.00 40.00 -45.87 17,053,866 263.99

PBG 79.50 -3.52 56.05 208.00 -61.58 14,295,000 1,136.45

PLAZACNTR 2.50 0.40 1.80 5.15 -43.82 297,174,515 742.94

POLAQUA 5.05 -5.61 4.53 20.60 -72.70 27,500,100 138.88

POLIMEXMS 1.73 -2.81 1.23 3.89 -54.59 521,154,076 901.60

POLNORD 15.40 6.65 11.03 33.55 -53.32 23,798,439 366.50

RANKPROGR 9.99 2.99 8.60 13.60 -7.41 37,145,050 371.08

ROBYG 1.19 -2.46 1.04 2.13 -37.04 257,390,000 306.29

RONSON 0.92 8.24 0.77 1.58 -37.84 272,360,000 250.57

TRAKCJA 1.23 17.14 0.65 4.00 -68.86 232,105,480 285.49

ULMA 60.00 -6.76 57.00 88.00 -27.71 5,255,632 315.34

UNIBEP 5.97 3.83 4.47 9.94 -40.00 33,927,184 202.55

WARIMPEX 3.45 9.52 2.95 10.89 -63.72 54,000,000 186.30

ZUE 7.16 17.38 5.07 14.54 -48.86 22,000,000 157.52

Property-related stocks

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Galeria Miodowa will feature a mall and a 4,000 sqm

retail park

kets as well, with Kraków andWroc∏aw taking a “clear lead”in terms of occupier activity. Injust the first three quarters of2011, demand in Poland’sregional cities had outstrippedthat of the entire year 2010.

The annual take-up inregional markets reachednearly 280,000 sqm, with50,000 sqm of that coming inthe fourth quarter.

In terms of supply in sec-ondary cities, 74,000 sqm wasbrought to the market in Q4,2011, the most since Q2 2010.However, the authors notedthat some 50 percent of thatcame from just three build-ings. Interestingly, Kraków hasbecome the first regional citywhere modern office stockexceeds 500,000 sqm.

Andrew Kureth

JANUARY 23-29, 2012 LOKALE IMMOBILIA – REAL ESTATE www.wbj.pl 17

Investment market

Central European real estateinvestment volumes double in 2011Poland boasted thelargest volume but theCzech Republic sawthe biggest growth

Investment activity in CentralEurope more than doubledyear-on-year in 2011 with atotal of €6.1 billion investedin the core markets ofPoland, the Czech Republic,Slovakia, Hungary andRomania last year, accordingto a recent report by Cush-man & Wakefield. Approxi-mately €2.9 billion wasinvested in the region in 2010,the study showed.

With €2.5 billion investedin the country in 2011, Polandremained the region’s leader,but it was the Czech Republicthat saw the largest y/yincrease in investment vol-umes, from €479 million to€2.2 billion. The first and thirdquarter of last year saw signifi-

cant investment activity inCentral Europe, but in Q4momentum was lost as the lat-est euro-zone crisis emerged.

Sector preferences re-mained largely unchangedwith retail, office and industri-al investment accounting for40 percent, 37 percent and 15percent of the total investmentvolume, respectively. CAImmo, AEW Europe, Atrium,Unibail Rodamco, Heitman,Deka, Union, Invesco, ECE,Meyer Bergman and Black-

stone were among the mostactive players.

“Most CE markets in 2011experienced a significantincrease in activity due tomuch improved investorappetite and a reasonable sup-ply of quality assets. … Giventhe more difficult financingenvironment, we don’t expect2012 volumes to match theprevious years; our forecast isaround €5 billion,” CharlesTaylor, partner at Cushman &Wakefield, said in a statement.

“Investor sentimentremains positive for Polandand the Czech Republic buteveryone is looking hard atHungary to see if this will bethe next EU domino to falland if it does, whether it takesothers in CE countries downwith it or instead turns thepressure up on Western mar-kets like Austria and Greece,whose banks are heavilyexposed to the region,” MrTaylor added.

Adam Zdrodowski

BZ WBK TFI putsportfolio up for saleThe BZ WBK TFI investmentfund is selling the portfolio ofthe Arka BZ WBK FunduszRynku NieruchomoÊci FIZclosed real estate fund due tothe planned liquidation of thelatter entity later this year.

Arka BZ WBK FunduszRynku NieruchomoÊci FIZ wasestablished in 2004 and theprocess of building its portfolioended three years later. Cur-rently the portfolio controlsproperty worth a total of z∏.1.1billion and the value of its assetsamounted to z∏.532 million as ofOctober 31, 2011.

The portfolio comprises 12commercial properties, twodeveloper projects and fourplots earmarked for residentialdevelopment. The schemesinclude Alfa Centrum in Olsz-tyn, Trinity Business Park I inWarsaw, Red Tower in ¸ódêand Alfa Plaza in Gdynia.

Two of the fund’s properties– Ujazdowskie 10 and JutrzenkiBusiness Park in Warsaw – havealready been sold. Cushman &

Wakefield is now looking forbuyers for 10 of the remainingproperties with the other proj-ects expected to be sold directlyor with the help of other advi-sors.

“The properties to be soldare leased to many reputabletenants whose loyalty is the bestevidence of the high quality ofthe offered property portfolio,”¸ukasz Maciak, commercialinvestment director at BZWBK TFI, said in a statement.

“It will be the first Polishproperty portfolio to be sold assingle assets or selected subport-folios. We are also looking forinvestors who might be willing tobuy all the properties on offer,”stated Piotr Szmilewski, seniorsurveyor in the capital marketsgroup of Cushman & Wakefield.

“There is a dearth of attrac-tive investment products in themarket and, therefore, we expectconsiderable interest from for-eign and Polish investors,” MrSzmilewski added.

Adam Zdrodowski

Office space

Record demand for office space in Warsaw in 2011Take up in Poland’scapital beat the recordlevels set a year earlier

Demand for office space in thePolish capital continues toimpress, with a record-break-ing level of 573,000 sqm oftake-up last year, according toa report released last week byJones Lang LaSalle. That rep-resented an increase of 4 per-cent on 2010, the previousrecord-setting year.

Pre-lease deals made up 21

percent of the take up in 2011.The biggest lease deal in

terms of area was incumbenttelecom Grupa TP’s lease of43,700 sqm in the under-con-struction Miasteczko Orangecomplex in the capital’s Ocho-ta district, according to theWarsaw Research Forum. Nexton the list was the renegotia-tion of a leasing contract forErnst & Young involving11,000 sqm in the Rondo 1building, followed by a leasecontract for Grupa Orlen for

space totaling 9,100 sqm in theSenator building.

“We are of the view that thesituation on the demand side inWarsaw will remain positivethroughout 2012,” JLL ana-lysts said in their report.

The study pointed to stablevacancy of 6.7 percent in War-saw (6.1 percent in the CBD,7.1 percent in the city centeroutskirts and 6.7 percent innon-central locations), andwith a record low delivery ofsupply, at 120,000 sqm, the nat-

ural result was a rise in rents.Prime office space in the War-saw city center now goes for€22-25 per sqm per month.Indeed, the report said thatsome triple-A buildings quoterents even higher than that.Meanwhile, the best non-cen-tral locations, such asMokotów, are being leased at€15-15.50 per sqm per month.

Regions resilientThe report pointed to a strongyear for Poland’s regional mar-

Warsaw Kraków Wrocaw Tri-city Katowice Poznaƒ ¸ódê

Total Stock (sqm) 3,597,000 501,400 372,700 349,650 253,800 243,800 228,800

Completions in Q4 2011 (sqm) 31,850 20,800 3,500 20,900 3,600 6,500 16,200

Under Construction Q4 2011 (sqm) 592,000 48,050 97,250 66,850 40,800 53,500 27,000

Vacancy Rate Q4 2011 (%) 6.7 8.0 3.4 8.4 11.5 9.5 19.1

A review of Poland’s main office markets

Source: Jones Lang LaSalle

Building investmentsCE investment volumes, 2010-2011 (in € million)

Source: Cushman & Wakefield

Sector Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011

Office 225 381 176 320 844 146 717 600

Retail 107 221 484 637 245 310 1,262 629

Industrial 18 95 91 37 541 44 100 196

Other 116 35 2 30 - 118 332 51

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JANUARY 23-29, 2012LOKALE IMMOBILIA – REAL ESTATE18 www.wbj.pl

PPG to start huge residentialproject in Moscow region

Warsaw-based developer Plat-inum Properties Group (PPG)is finishing talks with localauthorities concerning itsplanned Svetly Dali large-scaleresidential complex nearMoscow. It expects constructionon the investment to launch inthe middle of this year.

The Svetly Dali scheme willinvolve the development of60,000-90,000 sqm of usablespace over the next five toeight years. By the end of thisquarter the company wants todecide on a financing option

for the scheme. One of thealternatives it is considering isto team up with a Russianpartner.

“The value of the firstphase is estimated at approxi-mately $140 million, with theprofit on the whole investmentforecast to amount to $170million,” Gustaw Groth, vicepresident of the managementboard of PPG, said in a state-ment.

PPG is now building theRezydencja Naruszewicza res-idential project in Warsaw and

is planning to start construc-tion on a 10,000-sqm officescheme in Poznaƒ at thebeginning of 2013. The com-pany also wants to acquire atleast one new project this year.

The developer, which iscurrently listed on theNewConnect alternative mar-ket, plans to shift to the mainmarket of the Warsaw StockExchange later this year. Thecompany is now waiting for itsprospectus to be accepted bythe Financial SupervisionAuthority. Adam Zdrodowski

CO

UR

TE

SY O

F C

ISZ

EW

SK

I M

SL

FIN

AN

CIA

L C

OM

MU

NIC

AT

ION

S

PPG is now building Rezydencja Naruszewicza in Warsaw’s Mokotów district

Residential development

Fewer new schemes onWarsaw market in Q4Total supply, however,remains “record-breakingly high”

The number of projects whichentered the Warsaw residen-tial market fell on a quarterlybasis in the last three monthsof 2011, but the capital never-theless continued to offer thehighest number of total avail-able residential projectsamong major Polish cities,according to a new report byreal estate company Emmer-son.

A total of 26 new invest-ments were made available tobuyers on Warsaw’s primary

residential market in Q4 lastyear – five fewer than in Q3.A downward trend was alsoobserved in Poznaƒ andGdaƒsk, while q/q growth ofnewly available residentialprojects was noted inKraków, ¸ódê and Wroc∏aw.

The report found that bythe end of the fourth quarterthere were close to 400 resi-dential developments provid-ing homes for sale in Warsaw.In Kraków, potential homebuyers had close to 300 newhousing developments tochoose from, with almost 200available in Wroc∏aw.

In Q4, the largest invest-

ments in terms of number ofunits were found in Warsaw,where the average number ofdwellings per new projectstood at 135. In Gdaƒsk, thenumber was 116, in Wroc∏awand Poznaƒ 92, and inKraków 77.

While the number of newdevelopments that enteredthe capital’s residential mar-ket dropped off in Q4, over-all supply remains strong.

“Supply is record-break-ingly high that should fueldownward pressure on pricesin 2012, especially when wetake into account the factthat there are no other fac-tors, except price declines,which could stimulatedemand this year,” MarcinP∏aziƒski, an analyst atEmmerson, told Lokale Im-mobilia.

Moreover, despite thebloated supply, many devel-opers are expected to hurryto launch projects in the firstquarter of this year becauseon April 28, the Real EstatePurchaser Protection Act isdue to be implemented. Thisis expected to increase thecost for the developer ofbuilding new housing stock.

Veronika Joy, Gareth Price

Capital slowdownNumber of new residential projects that entered the market inPoland’s major cities, Q1-Q4 2011

City Q1 Q2 Q3 Q4

Warsaw 39 38 31 26

Kraków 34 37 13 24

¸ódê 7 4 3 6

Wroc∏aw 19 18 15 24

Poznaƒ 16 13 12 3

Gdaƒsk 10 9 17 16

Source: Emmerson

JANUARY 23-29, 2012 THE LIST www.wbj.pl 19

IT & Telecoms

Internet ProvidersRanked by revenue from internet services in 2010 www.bookoflists.pl

Notes: NA = Not Applicable, NR = Not Ranked, WND = Would Not Disclose. Research for The List was done in January 2011. Number ofemployees and ownership structure are as of December 2011. All information pertains to the companies’ activities in Poland. Companies notresponding to our survey are not listed.Foototes: (1) Grupa TP includes: Telekomunikacja Polska, Polska Telefonia Komórkowa Centertel, Contact Center, Fundacja Orange, Integrated Solutions,Orange Customer Service, Otwarty Rynek Elektroniczny, Paytel, PTE, TP Edukacja i Wypoczynek, TP Invest, TP Teltech, Wirtualna Polska(2) Hetan Sp. z o.o. is a provider of satellite internet access

To the best of WBJ ’s knowledge, the information is accurate as of press time. While every effort is made toensure accuracy and thoroughness, omissions and typographical errors may occur. Corrections or additions toThe List should be sent, on official letterhead, to Warsaw Business Journal, attn. Joanna Raszka, ul. Elblàska15/17, 01-747 Warsaw, via fax to (48-22) 639-8569, or via e-mail to wbjbol@wbj.pl. Copyright 2011, ValkeaMedia SA. The List may not be reprinted or reproduced in whole or in part without prior written permission ofthe publisher. Reprints are available.

Rank

Company nameAddressTel./FaxE-mail

Web page

Revenue frominternetservices (z∏. mln)

Total revenue(z∏. mln)

Net profit (z∏. mln)

Terrestriallinks

Radio links xDLS linksTotal velocityof operator

links

Domain nameregistration / Collocation ofequipment /

Central VoIP /Telephone

TV / Public IP /

IP v6 /BGP

Mobile Web /Disk image /

Technicalmaintenance

Totalemployees /Year founded

Ownership: Polish /Foreign

Top local executive /

Title

1

Grupa TP (1)

ul. Twarda 18, 00-105 Warsaw22 527-0000/22 527-0127biuro.prasowe@telekomunikacja.plwww.tp.pl

744.01,549.01,592.01,475.0

7,519.015,715.016,560.018,165.0

1,184.0108.0

1,282.02,190.0

WNDWNDWND

174,000WNDWND

2,158,0000.512

80WND

✓✓✓✓

✓✓✓✓

✓-✓

23,7341991

WNDMaciej Witucki

President

2

Netia SAul. Poleczki 13, 02-822 Warszawa22 352-2000/22 352-2001info@netia.plwww.netia.pl

222.0410.0339.0233.0

798.01,569.01,506.01,121.0

52.056.0-7.0

-123.0

3,4200.1281,000

1,3300.128

64

609,1490.128

20WND

✓✓✓✓

✓✓✓✓

✓✓✓

WND1990

WNDNovator Telecom

Operator - 31.3%; ThirdAvenue Management -24.1%; SISU Capital -10%; Banca Akros -

5.6%

Miros∏aw GodlewskiPresident

3

Telefonia DIALOG SAPl. Jana Paw∏a II 1, 50-136 Wroc∏aw71 781-1601/71 781-1600info@dialog.plwww.dialog.pl

49.195.997.097.0

251.5518.3509.0558.0

18.276.07.0

-287.0

147,8871

100

3,99314

WNDWNDWND

WND

-✓✓✓

✓✓✓✓

✓--

9131997

NetiaNone

Miros∏aw GodlewskiPresident

4

home.pl Sp.j.Pl. Rod∏a 9, 70-419 Szczecin801-885-555/91 432-5555info@home.plwww.home.pl

32.456.948.239.3

32.456.948.239.3

11.115.414.210.0

5155

10,240

WNDWNDWND

WNDWNDWND

40

✓---

-✓✓-

--✓

1991997

Stefan Jurczyk - 40%;Krystian Stypu∏a - 30%;

Piotr Kapcio - 30%None

Marcin KuÊmierzManaging Director

5

ATM SAul. Grochowska 21A, 04-186 Warsaw22 515-6100/22 515-6600info@atman.plwww.atman.pl

13.529.332.729.6

169.3401.8286.5267.4

10.621.49.98.9

2,8001

10,000

2801

300

WNDWNDWND

WND

-✓✓-

-✓✓✓

--✓

1721994

WNDRoman Szwed

President

6

Ogicom Sp. z o.o.ul. Arcybiskupa Antoniego Baraniaka 88,61-131 Poznaƒ61 622-2500/61 622-2525bok@ogicom.plwww.ogicom.pl

WND9.19.28.9

WND9.19.29.2

WND0.40.41.5

WNDWNDWND

WNDWNDWND

WNDWNDWND

WND

✓✓--

-✓--

-✓✓

302002

WNDAgnieszka

Dwernicka-PiaseckaPresident

7

Korbank SAul. Nabyciƒska 19, 53-677 Wroc∏aw71 723-4323/71 723-4329info@korbank.plwww.korbank.pl

1.63.12.72.2

1.73.32.82.3

0.20.70.60.3

7,5002

10,000

1000.5

1,000

---

20

✓✓✓✓

✓✓✓✓

-✓✓

351997

Tymoteusz Bi∏yk - 80.8%None

Tymoteusz Bi∏ykPresident

NR

Asean Telecom Sp. z o.o.Al. Krakowska 67C, 05-552 Warsaw22 292-8900/22 292-8901info@asean-telecom.plwww.asean-telecom.pl

WNDWNDWNDNA

WNDWNDWNDNA

WNDWNDWNDNA

WND1

10,000

WND1

1,000

WND1

1,00020

✓✓✓✓

✓✓✓✓

-✓✓

WND2009

WNDNone

Norbert Szczepaƒski

NR

Crowley Data Poland Sp. z o.o.ul. Stawki 2, 00-193 Warsaw22 427-3000/22 427-3003info@crowley.plwww.crowley.pl

WNDWNDWNDWND

WND105.3100.998.7

WNDWNDWNDWND

WND1

10,000

WND1

300

WND0.520

100

-✓✓✓

-✓✓✓

✓-✓

1601998

Grupa NetiaWND

Grzegorz EszPresident

NR

dcenter.plAl. Jerozolimskie 81, 02-001 Warsaw22 292-0000/22 292-0001info@dcenter.plwww.dcenter.pl

WNDWNDWNDNA

WNDWNDWNDNA

WNDWNDWNDNA

WND1

10,000

WND1

1,000

WND1

100100

✓✓✓✓

✓✓✓✓

-✓✓

WND2009

WNDNone

Rafa∏ KuÊmiderPresident

NR

eFUZJA Sp. z o.o.Al. Jerozolimskie 81, 02-001 Warsaw22 292-0999/22 292-0998info@eFUZJA.plwww.eFUZJA.pl

WNDWNDWNDWND

WNDWNDWNDWND

WNDWNDWNDWND

WND1

10,000

WND1

1,000

WND1

100100

✓✓✓✓

✓✓✓✓

-✓✓

WND2006

WNDNone

Agnieszka ˚urekPresident

36

Hetan Sp. z o.o. (2)

Al. Krakowska 4/6, 02-284 Warsaw22 886-5210/22 886-5211info@hetan.plwww.hetan.pl

WNDNANANA

WNDNANANA

WNDNANANA

WNDWNDWND

WNDWNDWND

WNDWNDWND

WND

----

-✓✓-

--✓

WND2011

WNDJorg Schmolinski

Managing Director

NR

NASK instytut badawczyul. Wàwozowa 18, 02-796 Warsaw22 380-8080/22 380-8201kontakt@nask.plwww.nask.pl

WNDWNDWNDWND

49.889.585.883.9

7.63.1-1.4-0.6

WNDWNDWND

WNDWNDWND

WNDWNDWND

8

✓✓✓✓

-✓✓✓

-✓✓

3211993

Treasury - 100%None

Micha∏ Chrzanowski Director

NR

UPC Polska Sp. z o.o.Al. Jana Paw∏a II 27, 00-867 Warsaw22 241-6822/22 241-6901info.upc@upc.com.plwww.upc.pl

WNDWNDWNDWND

WND948.6WNDWND

WNDWNDWNDWND

WND5

150

WNDWNDWND

WNDWNDWND

WND

-✓✓✓

✓✓✓✓

-WND

✓

1,2301989

WNDLiberty Global

Simon BoydPresident; General Director

1st half of 2011 / 2010 / 2009 / 2008 Number / Min velocity (Mb) / Max velocity (Mb)

Services

JANUARY 23-29, 2012MARKETS20 www.wbj.pl

SO

UR

CE

: W

SE

PLN-EUR

4.40

40

4.40

56

4.37

08

4.34

91

4.33

91

4.32

60

13.0

1

16.0

1

17.0

1

18.0

1

19.0

1

20.0

14

5 PLN-USD

13.0

1

16.0

1

17.0

1

18.0

1

19.0

1

20.0

1

3.43

23

3.47

98

3.42

15

3.40

00

3.36

78

3.35

37

3.0

3.6 PLN-GBP

13.0

1

16.0

1

17.0

1

18.0

1

19.0

1

20.0

1

5.27

11

5.33

24

5.25

84

5.22

41

5.19

96

5.18

39

5

6 PLN-CHF

3.63

76

3.64

43

3.61

36

3.59

59

3.59

12

3.58

19

13.0

1

16.0

1

17.0

1

18.0

1

19.0

1

20.0

13.5

4.0 PLN-RUB

13.0

1

16.0

1

17.0

1

18.0

1

19.0

1

20.0

1

0.10

84

0.10

92

0.10

85

0.10

77

0.10

69

0.10

68

0.10

0.12 PLN-100JPY

13.0

1

16.0

1

17.0

1

18.0

1

19.0

1

20.0

1

4.47

52

4.53

06

4.46

07

4.42

88

4.38

94

4.34

42

4

5

currency rates

Markets catch

their breath

Currency report

It had been a long time sinceinvestors experienced some-thing like what happened lastweek. Risk aversion declinedas the European crisisseemed to ease. Better-than-expected economic datafrom the US kept marketsgoing higher, and the mixedQ4 results of US companiesdid not spoil the spreadingoptimism.

Market players have tostay focused though. Macrodata from China – the engineof the global economy –shows that its economy iscooling down, while talksabout a restructuring ofGreek debt continue. Theproblems in Europe are farfrom solved and this week wemight see some profit-takingby investors with long (buy)positions.

The EUR/USD rebound-

ed strongly from its yearlylows of just above $1.26 to goall the way to $1.30. Last Fri-day it gave up some of thosegains, ending the week at$1.29. The z∏oty, influencedby positive external factors,continued to appreciate.Throughout the week, theEUR/PLN declined by 10groszy all the way to z∏.4.31,with the way open to levelsbelow z∏.4.30. TheUSD/PLN, the more volatilepair, tumbled from z∏.3.49 toz∏.3.34.

The other factor helpingthe z∏oty is hawkish state-ments by members ofPoland’s Monetary PolicyCouncil (RPP). With infla-tion remaining at above 4percent, instead of an inter-est rate cut as the marketexpected, an interest hike ispossible. ●

Adam Narczewski, X-TradeBrokers Dom Maklerski SA

SO

UR

CE

: N

BP

Major indices

Top 5 Closing % change (week) 52-week high 52-week low

FOTA 7.65 60.71 17.25 3.10REINHOLD 1.54 54.00 6.19 0.90IZOLACJA 1.08 42.11 1.78 0.72ABMSOLID 2.62 37.17 15.10 1.49YAWAL 5.35 30.17 14.95 2.91

WIG 39,288.13 (January 19 close)

Change for the week: 3.22% 52-week high: 50,371.74

Change year to January 19: 2.53% 52-week low: 36,549.47

Top 5 Closing % change (week) 52-week high 52-week low

LOTOS 24.14 10.73 49.50 21.30GTC 8.84 10.64 22.14 7.86PEKAO 150.00 7.45 180.20 115.10PKOBP 33.39 7.16 46.66 27.95PKNORLEN 36.95 6.79 58.85 30.33

Bottom 5 Closing % change (week) 52-week high 52-week low

DSS 5.59 -17.79 23.75 5.22ATLANTIS 0.42 -17.65 1.92 0.35IQP 1.69 -17.56 3.40 1.60PTI 11.90 -14.82 14.00 6.51MISPOL 3.30 -13.16 7.79 2.72

Bottom 5 Closing % change (week) 52-week high 52-week low

ASSECOPOL 45.77 -5.63 55.40 34.50CEZ 128.90 -4.16 155.00 116.10PGNIG 3.91 -3.93 4.65 3.25PBG 79.50 -3.52 209.60 53.70POLIMEXMS 1.73 -2.81 3.92 1.19

WIG20 2,244.38 (January 19 close)

Change for the week: 3.57% 52-week high: 2,932.62

Change year to January 19: 2.29% 52-week low: 2,089.84

mWIG40 2,251.40 (January 19 close)

Change for the week: 2.29% 52-week high: 2,987.72

Change year to January 19: 2.79% 52-week low: 2,076.52

sWIG80 8,970.87 (January 19 close)

Change for the week: 2.63% 52-week high: 12,932.00

Change year to January 19: 4.26% 52-week low: 8,218.71

NewConnect 41.13 (January 19 close)

Change for the week: -0.07% 52-week high: 61.53

Change year to January 19: -0.87% 52-week low: 40.23

WIG-Banki 5,640.58 (January 19 close)

Change for the week: 6.35% 52-week high: 7,387.49

Change year to January 19: 1.76% 52-week low: 4,944.19

DJIA12,623.98 (Jan 19 close)

1.23% (for the week)

CHANGE: 1.83%

(year to Jan 19)

52-week high: 12,876.00

52-week low: 10,404.49

NASDAQ2,788.33 (Jan 19 close)

2.34% (for the week)

CHANGE: 5.27%

(year to Jan 19)

52-week high: 2,887.75

52-week low: 2,298.89

S&P5001,314.50 (Jan 19 close)

1.47% (for the week)

CHANGE: 2.93%

(year to Jan 19)

52-week high: 1,370.58

52-week low: 1.074.77

FTSE1005,741.15 (Jan 19 close)

1.39% (for the week)

CHANGE: 0.72%

(year to Jan 19)

52-week high: 6,105.77

52-week low: 4,791.01

DAX6,416.26 (Jan 19 close)

3.84% (for the week)

CHANGE: 5.61%

(year to Jan 19)

52-week high: 7,600.41

52-week low: 4,965.80

NIKKEI2258,639.68 (Jan 19 close)

3.03% (for the week)

CHANGE: 0.93%

(year to Jan 19)

52-week high: 10,891.60

52-week low: 8,135.79

world stock indices

21.1

2

22.1

2

23.1

2

27.1

2

28.1

2

29.1

2

30.1

2

02.0

1

03.0

1

04.0

1

05.0

1

09.0

1

10.0

1

11.0

1

12.0

1

13.0

1

16.0

1

17.0

1

18.0

1

19.0

136,000

36,800

37,600

38,400

39,200

40,00021

.12

22.1

2

23.1

2

27.1

2

28.1

2

29.1

2

30.1

2

02.0

1

03.0

1

04.0

1

05.0

1

09.0

1

10.0

1

11.0

1

12.0

1

13.0

1

16.0

1

17.0

1

18.0

1

19.0

12,100

2,140

2,180

2,220

2,260

2,300

21.1

2

22.1

2

23.1

2

27.1

2

28.1

2

29.1

2

30.1

2

02.0

1

03.0

1

04.0

1

05.0

1

09.0

1

10.0

1

11.0

1

12.0

1

13.0

1

16.0

1

17.0

1

18.0

1

19.0

12,100

2,140

2,180

2,220

2,260

2,300

21.1

2

22.1

2

23.1

2

27.1

2

28.1

2

29.1

2

30.1

2

02.0

1

03.0

1

04.0

1

05.0

1

09.0

1

10.0

1

11.0

1

12.0

1

13.0

1

16.0

1

17.0

1

18.0

1

19.0

18,200

8,360

8,520

8,680

8,840

9,000

21.1

2

22.1

2

23.1

2

27.1

2

28.1

2

29.1

2

30.1

2

02.0

1

03.0

1

04.0

1

05.0

1

09.0

1

10.0

1

11.0

1

12.0

1

13.0

1

16.0

1

17.0

1

18.0

1

19.0

139.0

39.6

40.2

40.8

41.4

42.0

21.1

2

22.1

2

23.1

2

27.1

2

28.1

2

29.1

2

30.1

2

02.0

1

03.0

1

04.0

1

05.0

1

09.0

1

10.0

1

11.0

1

12.0

1

13.0

1

16.0

1

17.0

1

18.0

1

19.0

15,200

5,300

5,400

5,500

5,600

5,700

Other indices

Bulls on top

Stocks report

Last week was a strong onefor most equity indicesthroughout Europe, with theWIG and WIG20 closinghigher every day of the week.Investors shrugged off Stan-dard & Poor’s downgrade ofnine euro-zone countries, aswell as lingering worriesabout an unruly default inGreece. On Monday, January16, volume was thin, with USmarkets closed due to MartinLuther King Jr Day. Pushingstocks higher were strongreports from the automotivesector, with the WIG closing0.62 percent higher.

On Tuesday, January 17,markets continued theirclimb on the back of strongmacroeconomic data fromChina and Germany. Oil andcopper prices rose by morethan 2 percent, pushing upshares of both KGHM (3.63percent) and PKN Orlen

(3.47 percent). The WIG20finished its strongest day,gaining 1.14 percent.

The momentum contin-ued on Wednesday, January18, after stronger-than-ex-pected bank earnings fromseveral US banks broughtrenewed confidence to mar-kets. Also helping the situa-tion was the IMF’s move toincrease its ability to fight theEuropean crisis. The WIGclosed 0.85 percent higher,with oil companies again see-ing gains.

Thursday, January 19 sawfurther increases, drivenlargely after Spain successful-ly sold more longer-term debtthan had been hoped.

Friday, January 20, sawboth the WIG and WIG20dip in early morning trading,with both eventually closinghigher by 0.59 percent and0.74 percent respectively. ●

Andrew Nawrocki, WBJ market analyst

JANUARY 23-29, 2012 SPORTS www.wbj.pl 21

DAILY EXECUTIVE DIGEST

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 lG e r m a n v e r s i o n : w w w. p o l e n a mm o r g e n . p l

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

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

Pivotal year for Poland’s sports starsThis could prove to be a land-mark year for many Polish ath-letes with both the Euro 2012soccer championships and theLondon Olympics set to offerthe country’s sports stars achance to write their names inhistory. WBJ takes a look atthe Polish athletes currentlymaking the news and assessestheir chances of success overthe next 12 months.

Agnieszka RadwaƒskaKraków-born tennis playerAgnieszka Radwaƒska is still

chasing her first Grand Slamtitle, but 2012 could be theyear where she finally makes it

in the big time, with fourmajors up for grabs and thechance of an Olympic medalcome August.

The 21-year-old, who isranked #8 in the world by theATP, is currently making goodprogress at the AustralianOpen, the first Grand Slam ofthe 2012 calendar. Havingbeaten Bethanie Mattek-Sands by two sets to one in thefirst round, she then overcameArgentina’s Paula Ormaecheawith a comfortable 6-3, 6-1 winto reach round three, whereshe defeated Kazakhstan’sGalina Voskoboeva 6-2, 6-2.

Ms Radwaƒska’s recentform suggests she has somechance of lifting the mainprize, after a good start to2012. She has already reachedthe semi-finals of the SydneyInternational tournament,becoming the first Polishwoman to defeat a reigningworld number one, when shebeat Denmark’s CarolineWozniacki in the quarter-final.

Justyna KowalczykCross-country skier JustynaKowalczyk is now one of themost decorated Polish ath-letes of all time, after captur-ing the 2011/2012 Tour de Skititle earlier in January. It wasthe third time in a row that

Ms Kowalczyk had woncross-country skiing’s mostprestigious event, meaningshe is now able to add anoth-er title to her impressive tro-phy case. She has alreadywon two World Champi-onship golds in both the15km and 30km events, andan Olympic gold at the 2010Vancouver Games.

Ms Kowalczyk has a busycalender before she onceagain challenges for top hon-ors at the World Cup in Swe-den this March. And it wouldbe difficult to bet against hertaking home another medal inthis event as well.

Wojciech Szcz´sny andRobert Lewandowski Unquestionably the biggestsporting story in Poland thisyear is Euro 2012, which offersPoland’s international soccerplayers the opportunity tobecome national heroes,should they progress throughthe group stages or even dothe unthinkable and win thewhole tournament.

Arguably Poland’s two bestplayers from the current batchare 23-year-old Borussia Dort-mund striker RobertLewandowski and Arsenalgoalkeeper Wojciech Szcz´s-ny. Mr Lewandowski is cur-

rently enjoying a great secondseason in Germany’s Bundesli-ga, having scored 12 leaguegoals in just 17 games this sea-son, including a hat-trick in a

4-0 demolition of FC Augs-burg.

Mr Szcz´sny has had amore mixed season. Despitefirmly establishing himself asArsenal’s first-choice keeperat the tender age of 21, he hasalso made a number of high-profile mistakes this season,leading some to questionwhether he is ready for thechallenges of regular PremierLeague and ChampionsLeague action.

But if Poland is to have anychance of progressing througha first round group thatincludes the Czech Republic,Greece and Russia, it will defi-nitely need both players to bein top form come June 8 –when the tournament’s open-ing match is scheduled to beheld between Poland andGreece in Warsaw.

Robert KubicaOne Polish sports star who islooking at a difficult 2012 is

Formula 1 driver RobertKubica.

In February last year theKraków-born driver wasinvolved in a horrific car acci-dent while competing in theRonde di Andora rally race.The crash left him with multi-ple fractures to his right armand leg and a severe handinjury, ruling the Renault driv-er out of both the 2011 and2012 seasons.

Then, on January 11 thisyear, more bad luck struck MrKubica when he slipped out-side his Italian home and re-broke the same leg, furtherputting back his recovery date.

It now remains to be seenwhether he can make a fullrecovery and return to Formu-la 1 for the 2013 season, or ifhis career at the top level ofmotor sport is over.

David Ingham

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World Games

Wroc∏aw to host2017 World GamesA host of sports willentertain fans in thesouthwesternPolish city

The Polish city of Wroc∏aw waschosen as the host of the 2017World Games during an award-ing ceremony at the OlympicMuseum in Lausanne, Switzer-land, on January 12.

The capital of the Dol-noÊlàskie voivodship was cho-sen ahead of Cape Town andBudapest to become the hostof one of the biggest sports

tournaments in the world. Andorganizers predict more than400,000 spectators will come tothe event to watch some 3,500athletes compete in a host ofnon-Olympic disciplines.

“We are happy to presentour sports in Wroc∏aw in thesummer of 2017, and we aresure that we will be offeredoptimal conditions for oursportsmen and -women there.All the bids we received wereof very high quality, and it wasnot easy for us to reach a deci-sion,” Ron Froehlich, presi-

dent of the InternationalWorld Games Association.

The World Games, whichhave taken place every fouryears since 1981, sees athletescompete in sports includingsquash, water skiing, bodybuilding, 10-pin bowling andrugby sevens, among manymore. Each host city has theopportunity to choose fiveevents that will be part of thegames, but the full list for 2017is not set to be announceduntil March this year.

Marcin ¸ojewski

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Wroc∏aw’s new Municipal Stadium is likely to host some of the game’s events

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JANUARY 23-29, 2012LIFESTYLE22 www.wbj.pl

KinomamuseumFebruary 3 – March 3Museum of Modern Artul. Paƒska 3Warsaw

The Museum of Modern Artin Warsaw will host a month ofmovie screenings this Febru-ary, featuring the best of inter-national film, as well as somelesser known gems.

The event will open with ascreening of acclaimed Bri-

tish director Steve Mc-Queen’s new film “Shame”which premiered at last year’sVenice International FilmFestival. The array of pre-mieres also includes moviesfrom international filmmak-ers such as Miranda July(“The Future”), JanŠvankmajer (“Surviving Li-fe”), Wilhelm Sasnal (“ItLooks Pretty from a Dis-tance”), Wojciech Smarzows-

ki (“Rose”), and Phil Mulloy(“Goodbye Mister Christie”).

As an added incentive forfilm buffs, the entrance hall ofthe museum will feature theoriginal neon sign from War-saw’s legendary Skarpa cine-ma, which was torn down in2008. Entrance to all screen-ings is free of charge. DI

For more informationartmuseum.pl

Film festival

Art and film unite

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The Beatles & Queen –Valentine’s Day “Mocne Granie”February 11PKiN Sala KongresowaPlac Defilad 1Warsaw

This February, the music oftwo of the world’s mostfamous guitar bands will beunited in a dance extravaganza

in Sala Kongresowa, in War-saw’s Palace of Culture andScience. The performance,which is directed by RobertBalogh, is a collaborationbetween the Silesia Opera inBytom and the Gliwice MusicTheatre, and will see dancersperform modern ballet to clas-sic hits including “She LovesYou,” “Yesterday,” “All You

Need is Love,” “A Kind ofMagic,” “We Will Rock You”and “We Are the Champions.”

Tickets for the event, whichaims to show how music cancross the boundaries betweendifferent generations, arepriced from z∏.160. DI

For more informationlog on to kongresowa.pl

Dance

Rock ‘n’ roll greats

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Peter Hook & The LightsFebruary 11Proximaul. ˚wirki i Wigury 99a Warsaw

Peter Hook, a founding mem-ber and bass player of influen-tial Manchester bands JoyDivision and New Order, will

visit the capital with his newgroup “Peter Hook & TheLights” next month. Hooky, ashe is affectionately known, isfamed for his unique bass play-ing style on Joy Division andNew Order tracks, as well ashis involvement in the famousHaçienda night club.

This gig will see his newband play Joy Division’s 1979album “Unknown Pleasures”in its entirety, as well as songsincluding “Love Will Tear UsApart” from its second album,1980’s “Closer.” DI

For more information logon to klubproxima.com.pl

Concert

Back to bassics

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The original “Skarpa” sign

“Mocne Granie”

Peter Hook

JANUARY 23-29, 2012 LAST WORD www.wbj.pl 23

Visions of hell and unseeing iBallz

Tech Eye

There exist things not meant forhuman eyes. Visions so horrific thatthey sear the mind.

Imagine a pitch-black night fullof ominous forebodings. A strangethickness in the air. And then – anobese transvestite spewing chunksdown the side of your car.

It gets worse. You recognize thetransvestite as your high-school

geometry teacher. Old lessonsabout degenerate polynomials andperturbed vectors instantly make akind of horrible sense. You scram-ble, then fall up the stairs to yoursecond-storey home, ready to quaffas many beers as necessary to erasesulfurous memories of a latex-garbed, spew-spattered mathemati-

cian. But tragedy awaits you in thekitchen – the refrigerator is brokenand your spouse has thrown its con-tents away. Including all the beer.

That, dear readers, is the person-al hell which Techeye visited lastweek. Suffice it to say that we’relooking for a new refrigerator, a tal-ented therapist and possibly anexorcist. The only good news is thatwe’ve found a strong candidate forthe former.

Behold, the latest beer-storageunit from LG (lg.com). This is theKorean firm’s largest-capacity French-door refriger-ator, with a

respectable 31 cubicfeet of space. Indeed, the fresh-foodcompartment alone can hold over50 gallons of lager.

The unit is energy efficient, has a“bonus drawer” (whatever that is)

and its freezer boasts a Smart PullHandle, a feature presumablyaimed at refrigerator owners whoaren’t smart and have difficultypulling. But the real selling pointhere is the Blast Chiller (pictured) –a separate drawer that cools aroom-temperature can of beer infive to eight minutes.

LG hasn’t revealed the price ofthis fridge, but it’s not going to becheap and it’s too big for Techeye’sapartment, unless we knock down aload-bearing wall or two.

Alongwith a new

refrigerator, we’re also interested inthe Play video memo from NativeUnion (nativeunion.com). Notbecause it’s awesome or extraordi-narily well-crafted, but because itseems like an good way to remind

our wench that sheshould never throwbeer away. Ever.

The Play has amagnet on the back,so you can affix it ateye level forwhomever you wishto remind not tothrow away your beer(or cheese or whatev-er). It has a 2.4-inchcolor screen, holdsup to three minutesof video and only hasthree buttons, mak-ing it a good choicefor the Smart Pull Handle demo-graphic. Cost: $60.

And now for something com-pletely different – iBallz, “the origi-nal universal tablet stabilizing &shock absorbing harness” fromFriendly Integration (iballz.info).

In essence, this is four rubberballs connected by a cord. The ballsfit on the corners of your tablet, ele-vating it from potential spills anddirt, as well as protecting it from falls(on flat surfaces). It’s not a high-techsolution, but it eliminates a numberof risks and only costs $20.

On the other hand it introduces

the risk of ridicule. Consider whathappens when you try to say “myiBallz” too fast – it becomes“myBallz,” that’s what happens.Who knows what snigger-worthystatements might come out in theheat of the moment. Things like“Darn, one of myBallz fell offagain” or “Mom, the dog is chewingon myBallz!” perhaps. Consideryourself warned.

Still, these iBallz will neverbetray you, never scar your psycheby seeing things which must not beseen. That’s definitely a point intheir favor. ●

Ever seen something that made you want to stab your eyeballs out? Let us know: techeye.wbj@gmail.com

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Centre forContemporary Art atUjazdowski Castle ul. Jazdów 2www.csw.art.pl

Czarna Gallery ul. Marsza∏kowska 4www.czarnagaleria.art.pl

Galeria 022, DAP, Lufcik ul. Mazowiecka 11awww.owzpap.pl

Galeria 65 ul. Bema 65www.galeria65.com

Galeria Appendix 2(Praga)ul. Bia∏ostocka 9www.appendix2.com

Galeria Asymetria ul. Nowogrodzka 18awww.asymetria.eu

Galeria Foksal ul. Foksal 1-4www.galeriafoksal.pl

Galeria Milano Rondo Waszyngtona 2A(Praga)www.milano.arts.pl

Galeria Schody ul. Nowy Âwiat 39www.galeriaschody.pl

Galeria XX1 Al. Jana Paw∏a II 36www.galeriaxx1.pl

Galeria Zoya ul. Kopernika 32 m.8www.zoya.art.pl

Green Gallery ul. Krzywe Ko∏o 2/4www.greengallery.pl

KatarzynaNapiórkowska Art Galleryul. Âwi´tokrzyska 32, ul. KrakowskiePrzedmieÊcie 42/44and Old Town Square19/21www.napiorkowska.pl

Królikarnia NationalGalleryul. Pu∏awska 113awww.krolikarnia.mnw.art.pl

Le Guern Galleryul. Widok 8, www.leguern.pl

Museum ofIndependenceAleja SolidarnoÊci 62www.muzeumniepodleglosci.art.pl

National Museum inWarsaw Al. Jerozolimskie 3www.mnw.art.pl

Polish National Operaat Teatr WielkiPl. Teatralny 1www.teatrwielki.pl

Pracownia Galeriaul. Emilii Plater 14www.pracowniagaleria.pl

Rempex Art and Auction Houseul. Karowa 31www.rempex.com.pl

Royal CastlePl. Zamkowy 4www.zamek-krolewski.com.pl

Simonis Galleryul. Burakowska 9www.simonisgallery.com

State ArchaeologicalMuseum in Warsawul. D∏uga 52 (Arsena∏) www.pma.pl

State EthnographicMuseumul. Kredytowa 1www.ethnomuseum.website.pl

Historical Museum of Warsaw Old Town Square 28-42www.mhw.pl

History Meeting House of Warsaw ul. Karowa 20www.dsh.waw.pl

Warsaw Philharmonic ul. Jasna 5www.filharmonia.pl

Warsaw RisingMuseum ul. Grzybowska 79www.1944.pl

Wilanów PalaceMuseum and WilanówPoster Museumul. St Kostki Potockiego10/16www.milanow-palac.plwww.postermuseum.pl

Zachęta National ArtGalleryPl. Ma∏achowskiego 3www.zacheta.art.pl

Museums, galleries and venues in Warsaw

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