VOLUME 19, NUMBER 7 • FEB 25 – MAR 3, 2013 . z∏.12.50 (VAT 8% included) . ISSN 1233 7889 INDEX-RUCH-332-127

FFiissccaall ppaaccttppaasssseeddThe Sejm has approved theEU’s fiscal compact treaty

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Since 1994 . Poland’s only business weekly in English

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Poland’s leaders are making a push toget Poland ready for the euro zone,but with so much opposition and somuch to do, euro adoption is still along way off 13

CCiivviill uunniioonnwweeddggeeThe issue of civil unions couldtear the ruling party apart

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News . . . . . . . . . . . . . . . . . . . . .2, 5-6

Business . . . . . . . . . . . . . . . . . . . .8-9

Finance & Economics . . . . . . . . . .11

Opinion & Analysis . . . . . . . . . . . .12

Cover Story . . . . . . . . . . . . . . . . . .13

Interview . . . . . . . . . . . . . . . . .14-15

Lokale Immobilia . . . . . . . . . .17-18

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

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

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

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

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

In this issue

• Nowy Mokotów

• Europa Centralna

• Historic office space

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Irish eyes smilingIreland’s ambassador explainshow his country is digging outof its fiscal hole

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Rostowski new deputy PMPoland’s finance minister received apromotion in the prime minister’srecent cabinet shakeup

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Revving upPoland’s car market islooking healthier thanmany had expected

Path to the euro

Welcome riseIndustrial production

surprised on the

upside in January 11

500

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FEBRUARY 25 – MARCH 3, 2013NNEEWWSS2 www.wbj.pl

KwaÊniewski

back in politicsFormer Polish President

Aleksander KwaÊniewski

has announced that he

intends to create a list of

center-left politicians

who will run for a place

in the European

parliament in 2014 with

his blessing. The former

president, still a popular

figure in Poland, made

the announcement at a

press conference he

attended with the leader

of the liberal Palikot’s

Movement party, Janusz

Palikot.

Ukraine,

Poland,

Lithuania to

create peace-

keeping teamUkraine, Poland and

Lithuania are planning to

create a joint

peacekeeping team in

2013, the Defense

Ministry of Ukraine has

said. “Poland in February

officially confirmed that it

agreed to work with

Lithuania on the creation

of a military force and

complete forming it this

year,” First Deputy

Defense Minister

Oleksandr Oliynyk told a

press briefing on

Thursday, Interfax-

Ukraine reported.

PKO BP eying

Bank

Millennium PKO BP, Poland’s largest

bank, is planning

acquisitions, the bank’s

CEO Zbiegniew Jagie∏∏o

told daily Rzeczpospolita.

Taking over a large bank

that has a significant

presence in cities and a

portfolio of wealthy

clients would be justified

from a business point of

view, and Bank

Millennium meets these

criteria, he said.

TP costs

France

Telecom big

French

telecommunications giant

France Telecom said that

it wrote down €889

million in impairment

costs on its Polish

subsidiary

Telekomunikacja Polska

(TP) in 2012. The write-

down on TP comprised

the bulk of the French

group’s total

impairments of €1.84

billion, which also

stemmed from units in

Egypt and Romania. ●

AIG/Lincoln ............................................17

Air China ..................................................9

Alcatel ....................................................11

Alstom ....................................................11

AMD ........................................................23

APA Kury∏owicz & Associates................18

Auchan....................................................11

Bank Millennium......................................2

Bank Zachodni WBK ..............................11

Blizzard ..................................................23

Boeing ......................................................9

Bungie ....................................................23

Carrefour ................................................11

CD Projekt RED......................................23

Citi Handlowy..........................................11

Code........................................................17

Cushman & Wakefield ....................17, 18

Dalkia......................................................11

Dantex ....................................................18

Dom Development ................................17

DONG Energy ..........................................9

Echo Investment ....................................18

EDF ........................................................11

Elektrim Group ......................................17

Energa ......................................................9

Fiat............................................................8

France Telecom..................................2, 11

GdF Suez ................................................11

GE Capital Real Estate ..........................17

Grupa Waryƒski ......................................18

Helical Poland ........................................18

Hochtief Development ..........................17

Iberdrola ..................................................9

Konsalnet Holding ................................17

LOT............................................................9

Messer Eutectic Castolin ......................17

Metro-Projekt ........................................17

Microsoft ................................................23

Mindshare Polska ....................................8

Nintendo ................................................23

Nordea Bank ..........................................11

Orange ....................................................11

Peter Nielsen & Partners........................8

PGE ..........................................................9

PKO BP ..............................................2, 17

PKP ..........................................................9

Polimex-Mostostal ................................18

Polnord ..................................................18

Pracownia Architektoniczna

Czora & Czora ........................................18

S.A.M.I. Architekci

Mariusz Lewandowski i Wspólnicy........18

Sony ........................................................23

Starlink ....................................................2

Telekomunikacja Polska ....................2, 20

Thomson ................................................11

Turkish Airlines ........................................9

Valad Europe ..........................................17

Veolia ......................................................11

Vivendi ....................................................11

Warimpex................................................17

Warsaw Stock Exchange........................18

X-Trade Brokers ..............................13, 20

Leaders taking part in the EU-Ukraine summit that starts onMonday in Brussels will try toput Ukraine back on track tocloser cooperation with the EU,but the task will prove tough.

The imprisonment of YuliaTymoshenko, a former Ukrain-ian prime minister, will onceagain prove crucial in negotia-tions. The EU considers herincarceration politically moti-vated.

“The issue will be discussedat the summit, as it is impossi-ble to move forward in theEU-Ukraine relations beforethe problem of selective justiceis eliminated,” head of the EUdelegation to Ukraine, Am-bassador Jan Tombiƒski, said

in an interview with Interfax-Ukraine.

The relationship betweenthe EU and Ukraine has beenstrained in recent months, somuch so that EU-Ukrainesummit planned for 2012 didnot even take place.

Nevertheless, EU repre-sentatives are hopeful aheadof the upcoming summit.“2013 is a year of opportuni-ties. It is a year not only tointensify the relations betweenUkraine and the EuropeanUnion, but also to strengthenthe political, economic andlegal base of our cooperation,”said EU Commissioner forEnlargement and Neighbour-hood Policy Stefan Füle.

But the EU’s list ofdemands is long. “The Euro-pean Union is committed tosigning the association agree-ment, provided there is deter-mined action and tangibleprogress on the three keyissues: selective justice, short-comings of the October elec-tions and advancing associa-tion agenda reforms,” said MrFüle in February in Kiev.

Ukrainian officials bristledat the comments. The coun-try’s ambassador to the EU,Kostiantyn Yelisieiev, said hedidn’t understand why suchconditions are imposed onUkraine and not on the EU’sother partners.

JJaacceekk CCiieessnnoowwsskkii

€889 millionis how much French telecommunications giant FranceTelecom said it wrote down in impairment costs on its

Polish subsidiary Telekomunikacja Polska in 2012.

1.5 millionis the number of Poles who have been living abroad

for at least a year, according to the latest censusfigures.

z∏.7.9 billionis how much companies in Poland spent on advertising

in 2012, down by 5.2 percent compared to 2011,according to data released by media house Starlink.

0.3%is how much Poland’s industrial production increased

in January in year-on-year terms, easily beatinganalysts’ expectations, according to statistics office

GUS.

“[Not joining the EU’s fiscal pact will] condemnour country to the role of peripheral country,

stumbling about on the unpaved roads ofEurope. If you don’t understand that, then you

don’t understand anything.”Leszek Miller, leader of the Democratic Left Alliance, on why Poland shouldratify the EU’s so-called fiscal compact (see story, p. 6).

Quote of the Week

Numbers in the News

Company index

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FEBRUARY28 FACILITY & PROPERTY MANAGEMENT

CONFERENCEEvent: Panels on fire prevention, reducing a build-

ing’s maintenance costs and improving thesafety of users and the environment.

Location: Airport Hotel Okecie ul. 17 stycznia 24, Warsaw

Web: Konferencjafm.pl

FEB. 28-MAR. 1 EXPOCHEMEvent: A meeting place for chemical firms interest-

ed in buying and selling products and estab-lishing cooperation with foreign companies.

Location: Spodek, ul. Korfantego 35, KatowiceWeb: Expochem.pl

MARCH5-9 CEBITEvent: The flagship fair for the ICT industry. This

year, Poland is the Partner Country.Location: Hannover, Germany Web: CeBIT.de

7 ART AUCTIONEvent: 7 pm: First auction in Poland exclusively pre-

senting works by the late Jerzy Nowosielski. Location: DESA Unicum auction house

ul. Marsza∏kowska 34-50, WarsawWeb: desa.pl

12-15 MIPIMEvent: The world’s leading real estate event for

property professionals.Location: Palais des Festivals, Cannes, FranceWeb: MIPIM.com

18 PRCH RETAIL TRENDS SEMINAREvent: During the seminar experts will discuss the

latest trends in the field of research, devel-opment and investment in shopping centersand retail chains.

Location: Warsaw Mariott Hotel Aleje Jerozolimskie 65/79, Warsaw

Web: PRCH.org.pl

21-22 EUROPEAN EXECUTIVE FORUMEvent: This conference, entitled “Leadership in

Changing Europe,” will examine various lead-ership issues.

Location: Hotel Sheraton ul. Boles∏awa Prusa 2, Warsaw

Web: Executive-club.com.pl

February/March

Calendar

EU-Ukraine partnership talksIN THE SPOTLIGHT

Figures in focusHard-earned moneyMinimum wages in selected EU countries (in €, as of January 2013)

Source: Eurostat

But Donald Tusk’smuch-awaited cabinetreshuffle left somedisappointed

The most significant changePrime Minister Donald Tuskmade in his cabinet reshufflelast week was to appointFinance Minister Jacek Ros-towski as deputy prime minis-ter. Mr Rostowski, who willstill remain finance minister, isknown to have the prime min-ister’s ear, and is seen as a keyplayer in Donald Tusk’s gov-ernment.

“This is a return to the tra-dition where the prime minis-ter of a coalition governmenthas two deputies. It is goodwhen there is a balancebetween coalition partners in agovernment,” said Mr Tusk atthe press conference where hemade the announcements.

Mr Tusk also spoke of theimportance of issues of publicfinance at the moment, sayingsuch matters needed “bettercoordination.” The movedoubtless strengthens Mr Ros-towski’s position as well as thatof the finance ministry itself.

Since 2009 when DonaldTusk relieved his party col-league Grzegorz Schetyna ofthe position of deputy primeminister, the senior coalitionpartner Civic Platform has nothad its own man in the posi-tion.

Jacek Rostowski will nowjoin Deputy Prime MinisterJanusz Piechociƒski, theleader of the junior coalitionpartner, the Polish People’sParty, as joint number-two inthe government.

Changes in the interiorJacek Cichocki, now formerminister of the interior, willreplace the PM’s top advisor

Tomasz Arabski as chief of thepermanent committee of theCouncil of Ministers and headof the Prime Minister’s Chan-cellery.

In turn, Bart∏omiejSienkiewicz, who co-createdthe Centre for Eastern Studiesthink tank and was an analystin post-communist Poland’sfirst intelligence agency, theOffice for State Protection,

will take over as interior minis-ter.

Contrary to widespreadspeculation from the mediaand opposition politicians,heavily criticized officials suchas Health Minister BartoszAr∏ukowicz, Justice MinisterJaros∏aw Gowin and TreasuryMinister Miko∏aj Budzanow-ski all held onto their posts.But Mr Tusk let on that more

changes in his governmentmight be in store by mid-year.

“Sometimes changes areneeded if just to build a newsynergy even if you are notcritical of a particular minis-ter’s performance. And that iswhy I ask all who expected anearthquake or huge cadre rev-olution to be patient,” said MrTusk.

A mere manicureSome were very disappointedwith the changes indeed.Adam Hofman, spokespersonfor opposition party Law and

Justice, was particularly upsetwith the promotion of Mr Ros-towski, who has earned thereputation of being a particu-larly stingy finance minister.

“This is a signal to citizensthat they will be robbed evenmore this year,” said Mr Hof-man. “We were deceived intobelieving that there would bebig changes and talked aboutthat for a whole week. Mean-while, all we have is an ordi-nary manicure, fingernailspainted another color,” headded.

RReemmii AAddeekkooyyaa

Government

RRoossttoowwsskkii aappppooiinntteedd ddeeppuuttyy pprriimmee mmiinniisstteerr

The prime minister’sultimatum: supportcivil unions or leavethe party

Prime Minister Donald Tusk,leader of the ruling Civic Plat-form (PO) party, is reported tohave given an ultimatum tomore conservative members ofhis party, asking them tochoose between supportingthe government’s legislationon civil partnerships and leav-ing the party.

“Either the conservativesreach an agreement on thecivil unions matter, or they’llbe out of PO,” the prime min-ister said, according to radiostation TOK FM. “Civilunions are not a matter of con-science, they are a matter forCivic Platform’s leadership [todecide upon],” Mr Tuskadded.

The party is in turmoil overa new civil unions proposalwhich is to be agreed upon andsubmitted to parliament for avote within two weeks. The pre-

vious bill – which would havegiven same-sex couples some ofthe same rights that marriedcouples enjoy – fell throughwhen 46 MPs from the rulingparty broke from the party’sofficial line and voted against iton January 25.

When asked if he wouldleave the party, conservativeparty member John Godsonsaid, “I don’t exclude such anoption but I certainly hope itwon’t come to that.”

The new revisions to theproposal change one aspect ofthe former draft, namely thatcivil unions be concludedbefore a notary public and notin the Civil Registry office,thus taking the “marriage”facet of the partnerships out ofthe equation.

Mr Godson is one of themost unrelenting party mem-bers when it comes to civilpartnerships. “To me, person-ally, it’s a matter of world-view,” he told TVN24, indicat-ing he would oppose the newproposal.

Agree to disagreePO member Grzegorz Schety-na commented on his party’sinability to agree on the civilpartnerships issue, saying, “Invoting on matters such as civilunions, you can’t hide behindyour worldview or lack of suffi-cient discussion.”

He added, “There havebeen many discussions on thematter. ... There is always a dis-cussion, then it comes to a deci-

sion and it should be executed.”He explained that when his

colleagues voted against theirown party’s legislative propos-al it was “an unfortunatedemonstration of several partymembers who didn’t realizethe consequences of theiractions,” he told TVN24.

Jacek Rostowski, financeminister and newly nominateddeputy prime minister, admit-ted that PO has had problems

with its members disagreeing,but that party leadership“knows exactly how to solvethem,” he told RMF FM.

He stressed that PO was notcoming apart. Mr Rostowskiadded that the situation couldbe salvaged by “total politicalcohesiveness combined with agreat deal of tolerance andunderstanding in matters ofworldview and ideology.”

BBeeaattaa SSoocchhaa

Politics

Ruling party under strain over civil unions

FEBRUARY 25 – MARCH 3, 2013 NNEEWWSS www.wbj.pl 5

Changes to

NewConnectStarting March 1, at

least 15% of company

shares to be introduced

to trading on

NewConnect will have to

be held by at least 10

shareholders with an up

to 5% holding each.

Companies listed on

NewConnect will also

have to sign agreements

with brokers for a

period of three years,

instead of one year as is

currently the case.

These may only be the

first steps, as the

bourse is to analyze the

market carefully this

year and possibly carry

out further

modifications.

Trade sector in

bad condition

The trade-sector

business climate index,

calculated by the

Research Institute for

Economic Development

at the Warsaw School of

Economics, dropped by

0.1 point to 9.8 points in

the fourth quarter of

2012. This is the lowest

it has been in the last

quarter of the year since

2000. The survey

described the general

situation in the sector as

negative.

Regulator

liberalizes gas

market Poland’s energy

regulator URE issued a

decision saying that

gas-trade companies

will not have to have

their prices approved by

the watchdog. There are

97 companies in Poland

that have obtained gas-

trade permits. The

decision is aimed at

increasing free trade in

Poland’s natural gas

market.

Agreement

reached on

Church FundPoland’s government and

Roman Catholic Church

officials agreed on a

proposal to enable Polish

taxpayers to transfer

0.5% of their income tax

to a selected church. The

new law could come into

force in 2014. The

regulation could provide

the church with about

z∏.140 million annually.

This is significantly

higher than z∏.90 million

the church usually gets

from the state budget

within the so-called

Church Fund. ●

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John Godson (right) has been a conservative thorn in Mr Tusk’s (center) side

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Jacek Rostowski has gained the post of deputy prime minister and will keep his

finance portfolio

“Sometimes changesare needed if just to

build a new synergy.”

FEBRUARY 25 – MARCH 3, 2013NNEEWWSS6 www.wbj.pl

Polish MPs have giventhe go-ahead to thetreaty despite manydissenting voices

The Sejm, Poland’s lower houseof parliament, has given itsapproval to the fiscal compact,an intergovernmental treatyintroduced to discipline Euro-pean governments in their pub-lic finances.

The treaty entered intoforce on January 1, 2013 for the16 EU members who hadalready completed ratification.For subsequent ratifiers, it willenter into force on the first dayof the month following the sub-mission of ratification docu-ments with Brussels. Twenty-five of the EU’s 27 countrieshave pledged to adopt thetreaty.

Before the vote, Prime Min-ister Donald Tusk argued hardfor the fiscal compact in parlia-ment last week.

Biggest winnersThe PM said Poland had “wonthe financial battle for the nextseven years like no other coun-try in Europe” referring to therecently-agreed 2014-2020 EUbudget from which Poland willreceive a total of €105.8 billion,making it the biggest benefici-ary in the EU.

“The positive budget forPoland is the effect of a long-term strategy which assumed,among other things, winningthe support of European insti-tutions for the cohesion policy,”said Mr Tusk.

He went on to say that “thefiscal compact implements stan-dards in public finance that willprotect the Polish taxpayer andthe Polish state from excessive

risk. It will be the next step onthe road to a safe Europe.”

“I don’t think there is a con-vincing alternative idea for asafe Poland, an idea that wouldnot involve a strong and safeEuropean Union,” Mr Tuskadded. In the 460-memberSejm, 282 MPs supported thetreaty, enough to give it the sim-ple majority it needed to pass.

PiS opposedUnsurprisingly, the conserva-tive Law and Justice (PiS),Poland’s largest oppositionparty, opposed ratification. Itsleader, Jaros∏aw Kaczyƒski,contested the procedure bywhich it was voted on as well,saying the measure shouldrequire a two-thirds majority.

“We completely reject theclaim that the fiscal compactdoes not affect Poland’s inde-pendence,” he said. “If it is tobe accepted, then it shouldhave to garner a constitutionaltwo-thirds majority in parlia-ment.”

Mr Kaczyƒski said if thevote was not conducted underthose conditions, his party

would treat it as if it had nevertaken place. Solidarna Polska,another conservative party, wasalso against the treaty.

Meanwhile, liberal opposi-tion parties Palikot’s Move-ment and the Democratic LeftAlliance, as well as the juniorcoalition partner, the PolishPeople’s Party, all voted toadopt the compact.

Leszek Miller, leader of theDemocratic Left Alliance, saidnot joining the fiscal compactwould “condemn our countryto the role of peripheral coun-try, stumbling about on theunpaved roads of Europe. Ifyou don’t understand that thenyou don’t understand any-thing.”

The fiscal compact will notimpose any binding regulationson Poland until it joins the eurozone and it is still not clearwhen that will happen (seeCover Story, p. 13). The treatynow needs to be approved bythe Senate and then signed bythe president, both of which areexpected to happen withoutany difficulty.

RReemmii AAddeekkooyyaa

European Union

Poland on course to ratifythe EU’s fiscal compact

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Donald Tusk said Poland was the biggest winner in

the 2014-2020 EU budget negotiations

The prosecutor’s office inKraków is set to drop chargesagainst the former head of Pol-ish intelligence, ZbigniewSiemiàtkowski, in the case ofalleged CIA prisons in Poland,daily Gazeta Wyborcza reportedlast week.

Mr Siemiàtkowski wasaccused of aiding a war crimeand overstepping his authorityin the matter of alleged CIAprisons operating in Polandbetween 2003 and 2005, wherethe US intelligence agency isalleged to have interrogated

and tortured detainees accusedof terrorism.

Despite the investigation’s“top secret” status, some infor-mation has managed to come tolight. Mr Siemiàtkowski himselfconfirmed that charges hadbeen brought against him afterPolish media discovered thefact in 2012, some four yearsafter the investigation hadbegun.

This time, Gazeta Wyborczacited unnamed sources claim-ing that the charges against MrSiemiàtkowski were to be

dropped and that the decisionwas motivated by backlashmajor political figures wouldface had the investigation con-tinued.

“An indictment against theformer head of intelligencewould lead to charging formerPrime Minister Leszek Millerand possibly even former Presi-dent Aleksander KwaÊniewski,”Gazeta Wyborcza wrote.“Without their knowledge, sucha prison couldn’t possibly havefunctioned.”

BBeeaattaa SSoocchhaa

Charges to be droppedin CIA prisons case?

The latest wave ofemigration is thebiggest since the endof communism

About 1.5 million Poles havebeen living abroad for at least ayear, the latest population cen-sus data show. These people areunlikely to move back toPoland, demography expertProfessor Krystyna Iglicka toldDziennik Gazeta Prawna.

Ms Iglicka estimates thatabout 100,000 Poles left thecountry in 2012 and another500,000-800,000 will leave overthe next five years. This migra-tion is mostly for economic rea-sons and it’s the poorest regionsthat lose the highest number ofpeople.

Between 2000-2012, nearly300,000 Poles left the country, anumber equivalent to the popu-lation of a medium-sized city.The age group that most oftenleaves the country is 20-40 year-

olds, many of whom get mar-ried and have children abroad.This reduces the size ofPoland’s population of thosewho are economically active.

The last wave of emigrationwith a similar magnitudeoccurred after the imposition ofmartial law in Poland in 1981.In the 1980s, 1.2 million Polesleft to live abroad, but most of

them eventually came backafter communism collapsed.

According to new Eurostatmethodology, people living out-side their home country for atleast a year are no longer count-ed as its citizens. Therefore,when the report is released nextyear, Poland’s population willshow a fall from 38.5 million tosome 37 million. AASS,, JJCC

Demography

Poland losing people

37,000

37,500

38,000

38,500

39,000

201420

1120

1020

0920

082007

2006

2005

2004

37,000*

About to drop Poland’s population is about to fall drastically

* estimate based on new Eurostat methodology Source: Central Statistical Office

FEBRUARY 25 – MARCH 3, 20138 www.wbj.pl BBUUSSIINNEESSSS

While the Europeancar market slumps,Poland’s automotivesector seems to bedoing better

Last year was disastrous for thePolish automotive industry.The news that Fiat’s factory inTychy would lay off 1,500 work-ers hit the market particularlyhard. But the industry seems tobe headed for a surprising –and welcome – bounce back.

Poland reported a rise inthe number of newly regis-tered cars by 8.8 percent, thesecond-best result in the EU,behind the UK with 11.5 per-cent.

Throughout Europe thenumber of new cars registereddropped by 8.7 percent to885,200, according to Januarydata from the European Auto-mobile Manufacturers’ Asso-ciation. This is the lowest fig-ure since 1990, when the asso-ciation began collecting thedata.

Fiat CEO Sergio Mar-chionne told Bloomberg heexpected car makers’ totallosses in Europe to come in ataround €5 billion for 2012.

But export data in the auto-motive industry from Novem-ber herald some improvementin Poland. According to Auto-motiveSuppliers.pl, Polishcompanies exported €1.52 bil-lion worth of cars and car parts

in that month. While that stillrepresents a 3.49 percent dropy/y, experts had predicted amuch bigger drop consideringthe decline in EU markets.

Car parts in demandThe biggest drivers of improve-ment are car parts and caraccessories, as evidenced bydata on Poland’s exports toGermany, which accounts forover 31 percent of Poland’ssales abroad of cars and carparts.

And while car productionin Germany fell by 5 percent inNovember, Poland sold 18percent more car parts to itswestern neighbor y/y. Totalexports of car parts to the EU(which accounts for nearly 81percent of Poland’s totalexport volume) increased by

5.96 percent, while sales toother, non-EU markets fell bysome 22 percent.

Overall, in the first 11months of 2012, Poland export-ed €16.5 billion worth of carproducts (7.3 percent less thanin corresponding period of2011). The export of car partsand accessories was the only sec-tor where the value increased(by 4.5 percent) and was worth€6.2 billion. The other sectors –cars and car engines – registereddrops of 22 percent and 13.4percent respectively.

Thanks to the relativelygood November results, Auto-motiveSuppliers.pl predicts thatPolish automotive exports in2012 will come to €17.8 billion(compared to €19.1 billion in2011).

JJaacceekk CCiieessnnoowwsskkii

Contact: Miros∏aw Stefanik

ms@pnplaw.pl

Legal News

BROUGHT TO YOU BY PETER NIELSEN & PARTNERS LAW OFFICE

Payment deadlines in commercial transactionsOn February 8, the Sejm adopted a draftAct on Payment Deadlines in CommercialTransactions and submitted it to theSenate for review. The draft is to introducelegal solutions to discipline contractingparties to exercise shorter payment dead-lines and thus to prevent paymentdefaults in commercial transactions andimprove companies’ cash flow perform-ance.

The reasons for the new act are two-fold: one reason is the ineffectiveness ofthe currently binding act on payment reg-ulations, while the other is the EU Direc-tive 2011/7/EU on combating late pay-ment in commercial transactions. TheDirective should be implemented beforeMarch 16, 2013.

Changes to publicprocurement lawAn amendment to the Act on Public Pro-curement Law came into force on Febru-ary 20. It introduces to the Polish legal sys-tem the Directive 2009/81/EC of July 13,2009 which specifies the procedures for

awarding work, service and supply con-tracts by authorities or entities in the fieldof defense and security.

The amendment introduces a newchapter to the public procurement lawwith specific regulations on procurementin the field of defense and security. Theamended provisions are to ensure greaterparticipation of enterprises in awarding,performing or subcontracting such con-tracts in Poland.

Sejm approves fiscal pactratification On February 20, the Sejm adopted thedraft Act on Acceptance of Ratification bythe President of Treaty on Stability, Coordi-nation, and Management in Economic andMonetary Union, commonly referred to asthe fiscal pact. The treaty is to reinforcefinancial discipline, and to help balancepublic finances and better coordinate eco-nomic policies in the euro zone as well asin countries which are parties to theagreement. The treaty is one of the meas-ures EU is employing to combat the cur-rent economic crisis and prevent futureones. ●

Automotive

Shifting back towards growthS

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K

Polish car exports are on the rise

Both employers andemployees readilyengage in “under-the-table” agreements

As many as 47 percent ofPoles have relatives orfriends who work in the grayeconomy (in which workersare paid under the tablewithout paying income taxesor social security contribu-tions), according to a studyby pollster CBOS.

Krzysztof Zagórski, a pro-fessor from the KozminskiUniversity and the author ofthe study, believes that Polestend to look the other waywhen cheating the state isconcerned, and that it is amuch more common occur-

rence than one might expect. The study shows that 23

percent of respondents knowor are aware of people whofail to pay off their loans, andone in five respondents haveacquaintances who evadepaying some or all of theirtaxes. A quarter of those sur-veyed said they know peoplewho have unjustly beengranted welfare or unem-ployment benefits.

But it’s not just privateindividuals who cheat thestate. PKPP Lewiatan, anational employers’ associa-tion, conducted a similarstudy in 2012 which showedthat 33 percent of companiesin Poland hire employeesillegally, 4 percent more than

in 2011. It also turned outthat paying workers underthe table is extremely com-mon in smaller Polish com-panies.

Experts say that theincrease of pension contribu-tions, a higher minimumwage, and the economic slow-down are the three main rea-sons for such situation. Thesectors in which gray-economypractices are most prevalentare construction and trade.

“A legal job is a luxurygood in Poland. You have topay horrendously high taxesfor it,” Piotr Rogowiecki, anexpert at Pracodawcy RP, anemployers’ association, tolddaily Rzeczpospolita.

MMaarrttaa MMaarrddoosszz

Employment

Lots of Poles workingin gray economy

SH

UT

TE

RS

TO

CK

Plenty of employees take undocumented payment in Poland

Last year companies in Polandspent z∏.7.09 billion on advertis-ing, down by 5.2 percent com-pared to 2011, according todata released by media houseStarlink.

Starlink experts attributethe decline to the ongoing crisisin the fast-moving consumergoods market, a slowdown inthe pharmaceutical and finan-cial sectors, and changes in themedia world.

“On the one hand we areobserving a smaller demand foradvertising, which derives fromthe uncertain economic situa-tion in leading sectors of theeconomy,” said Lidia Kacprzy-cka, managing director at Star-link.

“On the other hand, howev-er, we have changes in themedia market, where digitiza-tion is bringing down viewer-ship of nationwide TV stations.Smaller and lower-cost stationsas well as theme channels aregaining, though.”

In 2012 only internet andcinema advertising managed tomaintain healthy growth rates,up 8.7 percent y/y and 11.2 per-cent y/y respectively.

The TV advertising marketas a whole shrank by 5.6 per-cent, with the four biggestbroadcasters (TVN, Polsat,TVP1 and TVP2) bearing thebrunt of the decline, recordingan 11 percent fall in ad rev-enues.

Theme channels, however,recorded a 12.8 percentincrease in advertising rev-enues.

Dagmara Robak frommedia house Mindshare Pols-ka estimates that in 2013 tele-vision advertising in Polandwill shrink by a further 10 per-cent and print advertising by15 percent. She predicts thatthe internet will continue tobe the only medium not toexperience advertising de-clines.

If the pace of the declinecontinues this year, the value ofthe advertising market will end2013 below its 2007 level,experts predict.

AASS,, KKWW

Ad sales continue to fall

Major Polish utilities PGE andEnerga are in advanced talks tobuy the Polish wind power busi-ness of Spanish energy firmIberdrola, Reuters reported,citing unnamed sources.

The deal’s value couldamount to z∏.1 billion, whichwould equal the value of PGEand Energa’s recent purchaseof the Polish wind farm assetsof Danish energy groupDONG Energy, which was

finalized last Tuesday.Iberdrola has five wind farm

projects with a total capacity of184.5 MW in Poland. Accord-ing to one source, the dealcould be announced this week.

PGE, Energa and Iberdroladeclined to comment on thematter.

Energa is mainly involved inthe manufacture, marketingand distribution of electricityand heat. It provides electricity

to 2.5 million households andmore than 300,000 companiesin Poland, giving it about 17percent of the country’s marketin electricity sales. Its electricitydistribution system coversabout a quarter of Poland’sarea.

PGE is the largest energygroup in Poland. The PGE cap-ital group’s share of electricityproduction in Poland is around40 percent. KKWW

PGE and Energa spendingbillions on wind farms

FEBRUARY 25 – MARCH 3, 2013 BBUUSSIINNEESSSS www.wbj.pl 9

New CEO SebastianMikosz wants to havethe air carrier readyfor privatizationbefore the end of 2013

Poland’s troubled state-ownedair carrier LOT could be soldthis year, once legal obstaclesare removed, the airline’snewly appointed CEO, Sebas-tian Mikosz, announced lastweek.

The government has longbeen looking to offload theloss-making airline, but hashad trouble since Polish lawrequires the Treasury to main-tain a controlling stake.Government officials havealready proposed draft legisla-tion to make the privatizationpossible, and it is expected topass soon.

But another obstacle tofinding a new owner for theairline will be EU regulationsthat prohibit an entity fromoutside the EU from owning acontrolling stake in any Euro-pean air carrier. It was theseregulations that scupperedLOT’s sale in previous years.Several potential buyers fromoutside the EU showed inter-est in the past, most notablyAir China and Turkish Air-lines, but due to the restric-tions a deal was never struck.

When asked who could buyLOT, Mr Mikosz respondedthat “the most obvious choice

would be another Europeanairline. Although right nowthey’re not interested in buy-ing LOT, things could changein the future.”

However, most Europeanairlines are struggling withproblems of their own.According to the InternationalAir Transport Association,European carriers lost €1.3billion in 2013. They are there-fore unlikely to look to acquirenew assets.

But experts point out thatwhile it would be easiest for aEuropean airline to take overLOT, the restrictions on thebuyer’s origin are hardly insur-mountable. A potential non-European buyer could set up aEU-based entity – alone or ina joint venture with a Euro-pean strategic or financial

investor – thus circumventingEU regulations.

For Mr Mikosz, the prepa-rations to sell LOT meanrestructuring. “The changesmust be radical,” he said,adding that he has the Trea-sury Ministry’s “blessing” for“any move that is necessary.”He estimates that the compa-ny will fire over 500 of itsemployees.

LOT has been hammeredby bad news recently, andthere is little to smile aboutwhen it comes to its recentlypurchased Dreamliners aswell. Deputy Treasury Minis-ter Rafa∏ Baniak announcedthat the company is losing$50,000 a day due to thegrounding of its two new Boe-ing planes.

JJaacceekk CCiieessnnoowwsskkii

CO

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OT

Previous attempts to sell LOT have failed so far

Airlines

LLOOTT ttoo bbee ssoollddtthhiiss yyeeaarr??

Polish State Railways (PKP)wants to improve the manage-ment of its train stations. Tostart with, PKP plans to sell 850out of its 2,500 train stations inPoland. Most of these will besold to local governments with-out tenders, as long as theypledge to make them availablefor passenger service.

Around 50 train stations

that have attractive locationsbut are not currently in use willbe available for anyone to buy.

“This offer is directed toanyone who has an interestingidea regarding using the stationbuilding for commercial pur-poses,” says Jaros∏aw Bator,PKP’s real estate director.

One example of such an“interesting idea” is the

Bia∏owie˝a Towarowa station,built in 1903, which has beentransformed into a restaurant.

Among the stations up forsale are: Gdaƒsk Oliwa, ¸ódê˚abiniec, Bia∏ystok Fabrycznyand stations in Ustka andAugustów.

Some of the stations willrequire sizable investments.

AASS

PKP plans to sell stations

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

FEBRUARY 25 – MARCH 3, 2013 FFIINNAANNCCEE && EECCOONNOOMMIICCSS www.wbj.pl 11

Maciej Witucki, presidentof the French Chamber ofIndustry and Commerce inPoland (CCIFP), discussesthe chamber’s activities

What kind of investments are popu-lar among French companies?French investments in Poland have astrong presence in several majorareas. The first one is industry, espe-cially new technologies with suchcompanies as Thomson, Alstom,Vivendi and Alcatel. Of course,French capital is also involved intelecommunications, with two majorplayers: France Telecom andOrange, as well as in the energy sec-tor with companies EDF and GdFSuez. The number of large Frenchcommercial distribution networks,such as Auchan and Carrefour, isalso growing. In the future thedemand for French investors activein the area of municipal services,such as Dalkia and Veolia, will prob-ably rise as well. So we are speakingof brands with well-established posi-tions. Some of them are world lead-ers in their industries.

Can the amount of French invest-ments in Poland be considered a suc-cess?France is one of the top three foreign

investors in Poland, with capital ofmore than €19 billion involved here.Today, French companies employover 200,000 people, which isundoubtedly a great success for thePolish economy.

This does not mean, however, thatthe presence of French companies inPoland cannot increase. With its bigmarket, Poland has great potential toattract new investors. Poland is a bigmarket. The Economic Forum organ-ized by CCIFP last year with the par-ticipation of the presidents of Polandand France showed that there are stillmany areas in which French-Polisheconomic cooperation could be bet-ter: in the energy, construction, andservices for the domestic defenseindustry.

What have French companiesachieved in Poland?French investors have been inPoland since the beginning ofPoland’s political and economictransformation. CCIFP has been inPoland since 1994, and the compa-nies that established our organiza-tion are still present in the Polishmarket.

In the last five years we have seenmore than a five-fold increase in thenumber of French investments inPoland. France is Poland’s fourth-biggest trading partner, with a 5.2

percent stake in the country’s foreigntrade.

French investments in Polandinfluence the growth of Polishexports – more than 50 percent ofgoods manufactured in Poland byFrench companies are exported.

What are CCIFP’s goals for thisyear?We intend to continue to supportFrench companies in their invest-ment activity in Poland and to repre-sent their interests before Polishauthorities. We want to share French

business experience with Polish com-panies.

We also want to help Frenchinvestors in their preparations forpossible expansion into Russia orUkraine. We are also planning topromote French culture and Frenchbrands in Poland.

How does CCIFP help Polish compa-nies to expand their business inFrance?The CCIFP has a special depart-ment called the Business Develop-ment Center, where counselors

familiar with Polish and French mar-ket realities help Polish companiesto succeed abroad. We organizetrade missions, both for individualcompanies and for the representa-tives of particular sectors. We alsosearch for partners, potential clientsor distributors.

We also arrange business meet-ings promoting Polish products,which increasing often end with acontract being signed. We want todevelop this because Polish compa-nies have great potential.

Does CCIFP participate in eventsdesigned to promote France inPoland?We promote France in two ways.Firstly, we promote French businesssolutions. Polish entrepreneurs knowour projects, such as the Eco-Townproject, seminars and training con-ducted at the Center for Trainingand the CCIFP Grand Prix. TheBusiness Development Centerexperts often organize seminarsabout France and the French marketduring meetings with local entrepre-neurs and students.

But we have also started to focusmore on the general public. In 2012we organized the celebration of thenational French holiday on July 14.In this way, we want to make Polesfeel the positive “French climate.” ●

Strengthening Poland’s French connectionsMedia patronage

Maciej Witucki

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CH

AM

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IN

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LA

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Industrial production

Polish industry sees surprise growthBut most analysts arecautious about what itmeans

Poland’s industrial productionin January proved muchstronger than analysts hadexpected, data released byPoland’s statistics office GUSshowed last week. In year-on-year terms, the value of soldindustrial production rose 0.3percent, against analysts’expectations of a drop of some3 percent. In monthly terms,industrial production rose by5.4 percent, while the markethad expected a rise of just 3percent.

Piotr Bujak, chief economistfor Poland at Nordea Bank, saidthat the figures had “beaten themost optimistic forecasts,” andadded that along with thestronger-than-expected Ger-man ZEW index released earli-er in the day, the data “heraldbetter times for the Polish econ-omy going forward.”

But other economists wereless sanguine. “[The] improve-ment against December waspartly due to a working-dayseffect and it is too early to say,based on these figures, thatPolish industry is recovering,”Bank Zachodni WBK econo-mists wrote in a statement.

“We stick to our long-heldview that assumes economicgrowth is likely to bottom outin Q1 at around 0.5 percent y/yand gradually pick up in thefollowing quarters,” CitiHandlowy analysts wrote,adding that despite thestronger industrial output theystill maintain their assessmentthat “overall growth in Polandwill be below potential, help-ing to keep inflation undercontrol.”

In their view, though, thepicture could improve if theGerman economy acceleratesmore than expected.

AAKK,, AASS

Inflation at lowest point since 2007Poland’s consumer price indexinflation rate fell to 1.7 per-cent in January year-on-year,with prices rising by 0.1 per-cent month-on-month, Po-land’s statistics office GUSannounced last week. At thislevel, inflation is at its lowestsince August 2007 and alsobelow economists’ medianprediction of 2 percent y/y.

“This decline was under-pinned by one-off factors (cutsin gas and communicationprices), but primarily it is aneffect of general lack of infla-tionary pressure given weakeconomic growth. This conclu-

sion is supported by the lowlevel of core inflation, which,according to our estimates,amounted to about 1.5 per-cent,” economists from bankBZ WBK wrote in a comment.“The inflation figure is astrong argument for anotherrate cut in March,” theyadded.

“There’s definitely moreroom to ease monetary poli-cy,” rate-setter Anna Zieliƒs-ka-G∏´bocka said in an inter-view on TVN CNBC, addingthat she would support a ratecut in March.

AASS

Individual consumption falls,trend likely to continuePoland’s individual consump-tion fell by some 0.9 percent inQ4 of 2012 and will likely fallin Q1 2013, the National Bankof Poland wrote in a report onthe situation of households.

The report, which is basedon estimates by the EconomicInstitute derived from theanalysis of the Poland’s statis-tics office, also suggests sub-

dued longer-term prospectsfor private consumption.

“Deteriorating negativeconsumer moods and weakprospects for income increasessuggest the low growth rate ofprivate consumption shouldhold in coming quarters,” theNBP said.

The main consumptionindicators for January show

continued decline and are closeto those from the beginning of2009, when the economic slow-down was at its worst in Poland.

NBP experts predict thatconsumers will keep theirspending low in Q1 to increaseconsumption later in the year,but the growth in spending isnot expected to be significant.

AASS

1

2

3

4

5

6

Jan. ’1

3

Dec. ’1

2

Nov. ’1

2

Oct. ’1

2

Sep.

’12

Aug.

’12Jul

. ’12

Jun. ’1

2

May ’1

2

Apr. ’

12

Mar. ’1

2

Feb.

’12

Jan. ’1

2

Dec. ’1

1

Nov. ’1

1

Oct. ’1

1

Sep.

’11

Aug.

’11Jul

. ’11

Jun. ’1

1

May ’1

1

Apr. ’

11

Mar. ’1

1

Feb.

’11

Jan. ’1

1

Steep dropPoland’s annual CPI inflation rate (%), January 2011-January 2013

So

urc

e:

Ce

ntr

al

Sta

tisti

ca

l O

ffic

e

Budget deficit

at 23.7% of

yearly plan

Poland’s state budget

deficit amounted to

z∏.8.43 billion at the

end January, or 23.7%

of the total deficit

planned for 2013, which

is z∏.35.56 billion, the

Ministry of Finance

announced. The state

often runs up a high

percentage of the deficit

early in the year, only for

that trend to decline

sharply in the second

half of the year as more

revenue comes in.

Industrial

production

prices down Industrial production

prices fell by 1.2% in

January 2013 compared

to the same month in

2012, statistics office

GUS announced last

week. This follows a

1.1% y/y decline in

December. In month-on-

month terms, January

industrial production

prices grew 0.1%.

Economists surveyed by

PAP had predicted

prices in January would

fall by 1.1% y/y and

grow 0.2% m/m. ●

FEBRUARY 25 – MARCH 3, 2013OOPPIINNIIOONN && AANNAALLYYSSIISS12 www.wbj.pl

Vaira Vike-Freiberga and Antonio Vitorino

F or decades, people havebemoaned the waning ofEurope’s global political power.

To add some precision to the debate,in 2010 we helped to write the Euro-pean Council on Foreign Relations’first Foreign Policy Scorecard.

Back then, we wrote – rathermildly – that Europe had been “dis-tracted” by the euro crisis. By the endof 2012, the crisis could be consid-ered less acute. Nevertheless, Euro-pean leaders have continued todevote more time and effort to finan-cial and institutional questions thanto geopolitical issues.

Europe’s image and soft powerhave undoubtedly continued to fadearound the world (though such atrend is difficult to quantify), whilemember states continue to cutdefense and development budgets.The good news, however, is thatEuropean foreign policy has notunraveled in the crisis. Indeed, it haseven shown some signs of progress.

Not a bad recordThe European Union managed topreserve the essence of its acquis

diplomatique. In fact, the Scorecard’sassessment of European foreign-pol-icy performance in 2012 shows mod-est signs of stabilization andresilience. Although the EU had nohigh-profile successes comparable tothe military intervention in Libya in2011, it performed surprisingly well inits external relations – especiallygiven the deep crisis with which itcontinued to struggle.

For starters, the coherence ofEurope’s policies toward Russiaimproved: the EU threatened to usethe World Trade Organization’s dis-pute-settlement mechanism when theKremlin announced new protection-ist measures in late 2012. It alsolaunched an antitrust probe againstRussian gas giant Gazprom, and crit-icized human-rights abuses duringthe crackdown on demonstrationsthat accompanied the March electionthat returned Vladimir Putin to thepresidency.

There were also signs of modestimprovement in Europe’s relationswith China, despite a lack of unitythat continued to undermine its lever-age. New EU missions to Niger,

South Sudan, and the Horn of Africaunder the aegis of the Common Secu-rity and Defense Policy were alsolaunched – something that had nothappened in the previous two years.

Of course, there were also areas inwhich Europeans performed less well.Above all, they could not break the frus-trating diplomatic gridlock over Syria orstem the escalation in violence as theyear went on. Europeans remaineddivided on the Israeli-Palestinian con-flict (though to a lesser degree than inprevious years), and failed to have animpact on the United Nations vote inNovember to upgrade Palestine’s sta-tus. They also struggled to pursue aunited approach to Azerbaijan andUkraine, and continued to seek acoherent approach to Turkey as acces-sion negotiations remained blocked.

Nonetheless, the EU’s foreign-policy performance in 2012 was posi-tive overall. It now remains to be seenwhether this momentum can be main-tained, which will depend largely onwhether the EU can overcome theeconomic crisis (which continues toworsen in several member countries),restore growth, and curb unemploy-

ment. In this sense, European leadersare right to focus on solving the finan-cial crisis in the euro zone.

Still much work to be doneAny future gains in global influence,however, will require Europeans toovercome their internal divisions andimprove their foreign-policy coordina-tion. In particular, success will requireturning the European External ActionService (EEAS) into an effectivediplomatic corps that can convert theEU’s huge resources into real power.

The near future will present agrowing list of challenges. There arealready indications from key strategicpartners that they are beginning toregard the euro crisis as the “newnormal”; in other words, they areplanning for a future in which Euro-pean power continues to erode.Europe’s lack of a collective defensestrategy, together with declininginvestment in military capacity, is alsoa serious obstacle to its continuingglobal influence as a security actor.

This makes it even more impor-tant for the EEAS to align the Com-mon Security and Defense Policy

with wider foreign-policy efforts. Thisis a daunting task, given the EU’s cur-rent structure. The specter of a Bri-tish withdrawal from the EU will notmake things any easier.

The US “pivot” to Asia furtherincreases the pressure on Europe todeal with its own neighborhood.Although the EU’s foreign policytoward Russia has become moreeffective, tensions have, if anything,grown – and may continue to do so.

Despite the gravity of the euro cri-sis, the EU foreign-policymakingmachine (such as it is) continued tofunction in 2012, with moderatelysuccessful results. Just getting by,however, is unlikely to be enough toaddress the challenges that Europe islikely to face this year. The EU willneed to do more – and do it better.We remain hopeful that it will be upto the task. ●

Vaira Vike-Freiberga is a formerpresident of Latvia. Antonio Vitorino

is a former Portuguese EU commis-sioner for justice and home affairs.Copyright: Project Syndicate, 2013.

Project-syndicate.org

M ost of the internationalfinancial crises that haveoccurred over the last 200

years were the result of strains creat-ed by the recycling of capital fromcountries with high savings to thosewith low savings. The current Euro-pean crisis is a case in point. For near-ly a decade, capital from high-savingscountries like Germany flowed tolow-savings countries like Spain. Theresulting build-up in debt created itsown constraints, and now Europe’seconomy is forced to rebalance.

If the rebalancing takes place onlyin Spain and other low-savings coun-tries, the result, as John MaynardKeynes warned 80 years ago, must bemuch higher unemployment.Whether unemployment remainsconfined to countries like Spain, oreventually migrates to those like Ger-many, depends on whether the for-mer remain in the euro.

Savings and consumptionAlthough the relative savings posi-tions of Germany and Spain seem toconfirm cultural stereotypes, nationalsavings rates have little to do with cul-tural proclivities. Instead, they largelyreflect policies at home and abroadthat determine household consump-tion rates.

A country’s overall consumptionrate is, of course, the flip side of itssavings rate. Apart from demograph-ics, which change slowly, three factorslargely explain differences in nationalconsumption rates.

First and foremost is the share ofnational income that householdsretain. In countries like the UnitedStates, where households keep alarge share of what they produce,consumption rates tend to be highrelative to GDP. In countries likeChina and Germany, however, wherebusinesses and the government retaina disproportionate share, householdconsumption rates may be corre-spondingly low.

The second factor is incomeinequality. As people become richer,their consumption grows more slowlythan their wealth. As inequality rises,consumption rates generally dropand savings rates generally rise.

Finally, there is households’ will-ingness to borrow to increase con-sumption, which is usually driven byperceptions about trends in house-hold wealth. In Spain, for example, asthe value of stocks, bonds, and realestate soared prior to 2008, Spaniardstook advantage of their growingwealth to borrow to increase con-sumption.

Spain’s optionsBut this is not the whole story. Con-sumption rates can also be driven byforeign policies that affect these threefactors. For example, an agreementin the late 1990s among the Germangovernment, corporations, and laborunions, which was aimed at generat-ing domestic employment by restrain-ing the wage share of GDP, automat-ically forced up the country’s savingsrate. Germany’s large trade deficits inthe decade before 2000 subsequentlyswung to large surpluses, which werebalanced by corresponding deficits incountries like Spain.

As Spain’s tradable-goods sectorcontracted in response to the expan-sion in Germany, it could respond inone of only three ways. First, Spaincould refuse to accept the tradedeficits, either by implementing pro-tectionist measures or by devaluing itscurrency. Second, it could absorbexcess German savings by lettingunemployment rise as local manufac-turers fired workers (because risingunemployment forces down the sav-ings rate). Finally, Spaniards couldborrow excess German savings andincrease consumption and investment.

Of course, Spain could not legallychoose the first option, owing to its EUand euro zone membership, and, not

surprisingly, was reluctant to choosethe second. This left only the thirdoption. Spaniards borrowed heavilyprior to the crisis to increase both con-sumption and investment, with muchof the latter channeled into wastefulreal-estate and infrastructure projects.

This continued until 2007-2008,when Spanish debt levels becameexcessive. But, as long as Germanydoes not absorb its excess savings andaccommodate the desired rise inSpanish savings, Spain is still facedwith the same options. Once borrow-ing is no longer possible, Spain musteither intervene in trade – whichimplies leaving the euro zone – oraccept many more years of highunemployment until wages are drivendown sufficiently to produce theequivalent of currency devaluation.

Rebalancing neededLow-savings countries cannot easilyadjust without an equivalent adjust-ment in high-savings countries,because their low savings rates mayhave been caused by high savingsabroad. After all, savings and invest-ment must be in balance globally, andif policy distortions cause savings inone country to rise faster than invest-ment, the reverse must occur else-where in the world.

Savings rates in Spain and otherdeficit countries in Europe had to droponce policy distortions forced up Ger-many’s savings rate. In theory, excessGerman savings could have leftEurope; but, given high Asian savingsthat already had to be absorbed, mainlyby the US, and the constraints imposedby the euro, it was almost inevitable thatexcess German savings would beexported to other European countries.

Germany should care aboutSpain’s difficulty in adjusting, becausethe resulting rise in European unem-ployment will be absorbed mostly bySpain unless the Spanish governmentaccelerates the adjustment process byleaving the euro zone and devaluing.In that case, Germany would bear thebrunt of the rise in unemployment.

Once deficit countries takeaggressive measures, it is usuallytrade-surplus countries that sufferthe most from international crisescaused by trade and capital flowimbalances. ●

Michael Pettis is professor offinance at Peking University and a sen-

ior associate at the Carnegie Endow-ment. This article is based on his

recently published book “The Great Rebalancing.”

Copyright: Project Syndicate, 2013.Project-syndicate.org

EEuurrooppee’’ss ffoorreeiiggnn--ppoolliiccyy rreessiilliieennccee

TThhee ssaavveerr’’ss ddiilleemmmmaa Michael Pettis

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Euro adoption

WWhheenn wwiillll PPoollaanndd jjooiinn tthhee eeuurroo zzoonnee??The country’s topofficials seem to betrying to speed thingsup

Poland will try to fulfill the cri-teria to join the euro zone “assoon as possible” but the finaldecision whether to access ornot would have to be “100 per-cent safe for our country,” saidPrime Minister Donald Tuskwhile speaking on the issue inparliament last week.

The government has beguna push towards bringing thecountry closer to joining thesingle currency union, startingwith a comprehensive publicdebate, as it looks to makePoland a core EU memberthat can participate in thebloc’s key fiscal decisions.

During the speech, theprime minister also said thechoice of joining the euro zonewould need a “widespread”support amongst MPs, refer-ring to the fact that a two-thirds(or “constitutional”) majoritywill be needed in parliament tochange Poland’s official curren-cy from the z∏oty to the euro.

“There will not be a consti-tutional majority for joiningthe euro zone unless there iswidespread and complete con-viction that it is safe forPoland,” said Mr Tusk.

However, in order to get aconstitutional majority onboard, the government wouldneed the support of the largestopposition party, Law and Jus-tice (PiS). But the euroscepticPiS has said it wants a referen-dum on the issue.

Euro enthusiasts would behard-pressed to win such a ref-erendum. A December IpsosObserver survey showed 56percent of Poles were againstPoland adopting the euro.

President in favorThis week, the prime ministerand his government are sched-uled to meet with PresidentBronis∏aw Komorowski in aspecial Cabinet Council meet-ing organized to discuss

Poland’s path to the the eurozone. The president fully sup-ports Poland adopting theEuropean common currency.

In an interview for televi-sion channel TVP1 last month,Mr Komorowski said thatPoland should be able to fulfillthe euro zone’s convergencecriteria by 2015.

“Today instead of consider-ing theoretical matters, such astaking decisions about Poland’smembership in the euro zone,we should concentrate on thefirst phase: fulfilling therequirements to join the eurozone ... because they are goodfor Poland,” the president said.

Nevertheless, Mr Komo-rowski has given no indicationthat he intends to hurry theprime minister and his govern-ment on the issue, at least fornow.

Conditions to meetIn 2008, Prime Minister Tusksaid that Poland would adoptthe euro by 2011 – that wasjust days before the collapse ofLehman Brothers, and theensuing global economic crisismeant all those plans went outthe window. Since then, thePolish government has main-tained that it is committed tojoining the euro zone whilerefusing to set a concrete datefor eventual membership.However, government officialssay that Poland will have ful-

filled all the criteria needed tojoin the currency zone by 2015.

To be able to adopt theeuro, Poland must meet theconditions laid out in the EU’sMaastricht Treaty, such asbringing its budget deficit towithin 3 percent of GDP, pub-lic debt below 60 percent ofGDP and the inflation rate towithin 1.5 percentage points ofthe average of the three EUstates with the slowest pricegrowth. It must also meet cer-tain interest-rate convergencecriteria and spend two years inthe European Exchange RateMechanism (ERM II).

However, as of January2013, the only of these criteriaPoland had met were thoseregarding public debt and inter-est rates. But the governmentmade significant progress whenit comes to bringing the overallbudget deficit closer to theMaastricht Treaty targets.

Among its reforms, MrTusk’s government can countraising the retirement age andcurbing early retirement pen-sions for uniformed services. Itmanaged to reduce the budgetdeficit to 3.4 percent of GDPlast year from 7.9 percent in2010. Meanwhile, Poland’spublic debt was under 53 per-cent of GDP in 2012, accord-ing to finance ministry esti-mates, well under the permit-ted maximum 60 percent. Andthat compares with an average

of 92.9 percent in the euroarea.

Experts weigh in“Poland will need about fouryears to join the euro zone. Atthe moment, we don’t meetthe criteria, especially the fis-cal ones. But we hope to fulfillthem by 2014,” said Stanis∏awGomu∏ka, chief economist atthe Business Centre Club anda former deputy finance minis-ter in Mr Tusk’s government.

“The economic slowdownwill make it easier to fulfill theinterest rate and inflation cri-teria. The euro zone itself is

coming back to health thanksto its reforms and so it wouldnow be safe to join,” he added.

And so BCC, one of thelargest and most influentialemployers’ associations in thecountry, thinks Poland shouldjoin the ERM2 at the begin-ning of 2014 to enable it to for-mally join the currency unionat the beginning of 2017.

But Mr Gomu∏ka saidthere is a risk the processcould still be a drawn out affairdue to Poland “not reducingthe budget deficit fast enoughand not changing the constitu-tion on time.”

Meanwhile, Zenon Marci-niak, an economics professor atthe Warsaw School of Econom-ics, said the National Bank ofPoland has conducted “twocomplex surveys, both of whichrevealed that joining the eurozone would bring tangible bene-fits for Poland. And so delaymeans delaying those benefits.”

Marek Belka, a formerprime minister and currenthead of the NBP, spoke out onthe matter recently. In aninterview with the Wall StreetJournal last week, he said hesupports joining the euro zonebut is “less enthusiastic abouta very quick euro adoption.”

Recent changes in the rulesgoverning the euro zone havestrengthened the common cur-rency, Mr Belka said. But healso said that Poles need tokeep in mind that the goal is notjust “to join the euro, but also tostay there as a country of thecore and not of the periphery.”

“We’re still a catching-upeconomy, an emerging econo-my, with all its weaknesses andstrengths,” Mr Belka said,adding that Polish policy mak-ers should compare the coun-try with “the Spain of someyears ago.”

“We know what happenedthere, but we hope to avoid themistakes of Spain,” he added.

When, realistically?Looking at macroeconomicdata and economic forecasts, itwould seem that the BCC’sproposal for Poland to join theeuro zone in 2017 is not anunrealistic one. If there con-tinues to be strong politicalwill in Poland to join the cur-rency union and if the Polisheconomy does not take anyunexpected hits in the comingyears, then it is likely thatPoland will join the euro zonebefore the second decade ofthe 21st century runs out. ●

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Will Donald Tusk and Bronis∏aw Komorowski take Poland into the euro zone?

Remi Adekoya

Maastricht criteria for euro zone entry (ECB methodology)

HICP inflation rate Budget deficit to GDP Debt-to-GDP ratio Long-term interest rate

Maximum 3.1% 3% 60% 5.8%

Poland’s 2012 results 4% 5.1% 56.3% 5.77%

Source: 2012 ECB report

Should Poland try to adopt the euro as soon as possible?

“Yes”Henryka BochniarzPresident of PKPP Lewiatan

“While the European Union moves towardsdeeper integration, Poland cannot remain out-side the area of close cooperation. Polandmust be in the euro zone if it wants to be a trueEU member and have any bearing on the EU’sshape in the future, a year or 10 years fromnow. Prime Minister Donald Tusk has alreadydeclared our intention to adopt the commoncurrency, now is the time to start a publicdebate on the benefits and costs of joining theeuro zone.

It is the debate as well as a thorough infor-mation campaign that matters, and not thedates. Recent polls show that two-thirds ofPoles oppose euro adoption. The prevalentsentiments among entrepreneurs don’t instilloptimism, either. That’s why we need a discus-sion based on facts and not on populists’ argu-ments. Meanwhile the only comprehensivedocument analyzing the pros and cons of beingpart of the euro zone was published by theNational Bank of Poland back in 2008! A newreport is therefore indispensable before anyreal actions are taken.”

“No”Adam NarczewskiManaging Director, X-Trade Brokers

“Poland will enter the euro zone one day, but Ioppose doing it as soon as possible. The Polisheconomy is far from real convergence with theeuro zone’s economy and therefore the govern-ment should take its time with the decision.

Poland is still an emerging market and untilit converges with other euro zone economies, itshould not accept the euro. Poland needs anautonomous monetary policy. As an emergingmarket it needs higher interest rates. Enteringthe euro zone will mean accepting the much-lower rates established by the European Cen-tral Bank. Lower rates should give a boost tothe economy: GDP would grow faster relative-ly to other economies; but at the same time itwould cause inflation to jump.

Increasing inflation, with the euro remain-ing at the same level relative to other curren-cies, would make the Polish economy less com-petitive. This in turn will push unemploymenthigher.

In summary, lower rates will boost GDP inthe short term, but will cause higher inflationand higher unemployment in the longer term.”

FEBRUARY 25 – MARCH 3, 2013IINNTTEERRVVIIEEWW14 www.wbj.pl

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€22.8 bln for

Polish regionsPolish regions will

receive more funds in the

2014-2020 budget than in

the previous budgetary

period, Deputy Minister

for Regional

Development Pawe∏

Or∏owski said. The money

– an estimated €22.8

billion – will come from

the European Regional

Development Fund and

the European Social

Fund.

Trade booms

on eastern

borders Statistics office GUS

estimates that in 2012,

Russians, Belarusians

and Ukrainians spent

z∏.6.62 billion on shopping

in Poland’s border area,

mostly on food,

construction materials

and car parts. That’s up

from z∏.5 billion in 2011.

Poles also cross the

border to buy cheaper

products, mostly gasoline.

They spent roughly z∏.650

million in 2012 on such

trips. Shopping in Poland

is a bargain for Russians,

Belarusians and

Ukrainians, as many

prices are lower than at

home. ●

Ewa Boniecka: Having beenbadly affected by a banking cri-sis which led to an economiccrisis, Ireland’s strategy foreconomic recovery seems to beworking. Why do you thinkthat is?Eugene Hutchinson: Irelandposted modest growth in 2011and 2012 and we expect 1.5percent GDP growth this year.The export sector is leading therecovery. Exports are nowexceeding pre-crisis levels andreflect the very significantimprovement in our competi-tiveness.

Foreign direct investmentis strong, the difficult inter-national economic environ-ment notwithstanding. Weare the world’s highest-rank-

ing economy in terms of theavailability of a skilled work-force. With one of the mostopen economies in theworld, Ireland is, in a realsense, “trading” its way torecovery – the only sustain-able way in the long term.Exports are forecast toincrease by some 3.3 percentthis year.

The strong export per-formance has been producingan increasing surplus in thebalance of payments since2010. However, domesticdemand remains subdued,household savings are highand, while this has begun toease somewhat, unemploy-ment is stubbornly high atabout 14 percent.

What is the outlook for thefuture then?Our medium-term growthpotential is strong. We are for-tunate in having a flexible,adaptable economy, a well-educated and an international-ly recognized pro-businessenvironment. Our GDPgrowth is forecast at 2.7 percent

for 2014 and 2015. With this, aswell as the further consolida-tion of public finances, ourbudget deficit should bereduced to below 3 percent ofGDP by 2015.So far, Ireland has met andexceeded all of the targets in ourEU/IMF assistance program.We will continue to do so. Our

banking system is being down-sized and repaired, sustainabilityrestored to public finances andwe are concentrating on stimu-lating economic growth. Butmany risks and uncertaintiesremain, such as the economicsituation in our export markets.

This year, we intend to bethe first EU/IMF programcountry in the euro zone tomake a sustained return to thesovereign bond markets, andwe are working with our part-ners to make sure this difficulttask is achieved.

Needless to say, this hasn’tbeen an easy process for Ire-land. It has required us to makedifficult choices, and askedmuch of the Irish people. Yetwe have also been able to main-tain social cohesion and soli-darity throughout this difficultperiod.

Ireland took over the rotatingPresidency of the EU in Jan-

uary. This is a familiar role forIreland, isn’t it?Yes, this is Ireland’s seventhPresidency. The first was in1975 – a few months after Ijoined our foreign ministry.Our 1990 Presidency managedEurope’s common approach tothe historic unification of Ger-many. In 2004, during Ireland’smost recent EU Presidency, wewelcomed Poland and nineother member states into theUnion. And this year we cele-brate the 40th anniversary ofIreland’s membership of whatis now the European Union.

While we are, in a sense,Presidency veterans, in anotherway we are newcomers as thiswill be our first EU Presidencyunder the revised rules andprocedures of the Treaty of Lis-bon. In that sense, Poland isahead of us; Poland has alreadyheld a Presidency under thenew Lisbon Treaty arrange-ments.

Eugene Hutchinson, Ireland’s ambassador toPoland, sits down with WBJ to talk about thesituation in the European Union and the 2014-2020 budget, the Irish EU Presidency andPolish-Irish relations

“Ireland is, in a realsense, ‘trading’ its way

to recovery.”

International relations

Ireland gettingback on track

FEBRUARY 25 – MARCH 3, 2013 IINNTTEERRVVIIEEWW www.wbj.pl 15

When we were preparingfor our Presidency, the PolishMinistry of Foreign Affairsshared with our planners itsexperiences from Poland’s ownsuccessful tenure. So we hopethat we can make progress,make a difference. But thePresidency, Irish or otherwise,cannot do it alone. The cooper-ation of all member states isrequired to succeed.

What are your country’s priori-ties for the EU Presidency?Of course, every Presidency hasan array of challenges to con-front. Some of these are ongo-ing, such as the economic crisiswhich has dominated the workof all EU presidencies in recentyears. Its aftershocks, as well asthe Union’s response to them,will be very evident during Ire-land’s Presidency.

As we see it, 2013 ushers ina new phase in the EU’s drivefor recovery. So Ireland’s Pres-idency is about making a con-tribution to securing stabilityand ensuring that this will bringjobs and growth. Hence thetheme of our Presidency is“Stability, Jobs and Growth.”

We have all been affectedby a crisis that revealed theweakness in the monetary andfiscal framework of the Euro-pean Union. The economicand social effects of the crisishave led to unacceptably highlevels of unemployment andhardship across the EU, notleast in Ireland.

But we see opportunities aswell as challenges at this stage.We feel that the EU is enteringthe next phase of its recovery.The values and strengthsunderpinning the Europeanproject ensure that the Euro-pean method of decision-mak-ing can indeed produce thenecessary changes.

The pressing priority for theUnion is economic growth, togive those affected by devastat-ing job losses a chance. So thefirst step is to build lasting sta-bility, starting with advancingthe renewal of economic gover-nance in Europe.

We feel that a key area forprogress will be in the bankingunion. Fixing the Europeanbanking system will make a realdifference. We also aim toimprove the Union’s economiccoordination. We need to opti-mize the prospects for job-friendly growth and contributeto tackling youth unemploy-ment. In a nutshell, our prioritiesare stability, jobs and growth.

Could you be more specific?Let me explain our approachon jobs. We applied what wecalled a “jobs test” across allpolicy areas when picking our[EU] Presidency’s priorities.With youth joblessness at morethan 25 percent in 13 memberstates, including Ireland, wewant to spare no effort in tack-ling this scourge. We wish tosee member states’ policiesmove towards programs oftraineeships, further educationand other opportunities.

The “Compact for Growthand Jobs” is a key element of theIrish Presidency and the need toimprove the implementation ofthe single market priorities isclear. This has been a greatEuropean success story, but astory which is yet unfinished. Wewant to unlock more of the sin-gle market’s potential, thus con-tributing to job creation and tothe viability of small and medi-um-sized enterprises.

Lower transaction costs, forexample, will increase profitsand thus employment in theseenterprises. There are nearly21 million SMEs in the EU,employing more than 85 mil-lion people. A lot can be doneto boost employment in otherareas, for example through the“Erasmus for All” framework.

Our Presidency is pushingahead with legislative proposalsto promote Europe’s DigitalEconomy, to benefit both busi-ness and consumers. This is acomplex, multifaceted area:EU foreign ministers will workon cyber security, competitive-ness ministers on copyrightaspects while EU justice minis-ters will work on data protec-tion.

Has the enlargement processlost its momentum?We are working with renewedpurpose on further enlarge-ment of the Union, to advancethe process for all of the candi-dates and prospective candi-dates. We expect to see Croatiajoin the EU at the beginning ofJuly 2013. We want to advancethe negotiations with Icelandand Montenegro, and will alsorestore the momentum in theaccession process with Turkey.Each country is at a differentstage but we hope to opennegotiation chapters with all ofthem.

The European CouncilConclusions agreed in Decem-ber to allow for the possibilityof important decisions on the

former Yugoslav Republic ofMacedonia, Serbia, Albania,and Kosovo during Ireland’sterm. We stand ready toprogress with them during ourPresidency, should the Councilso decide.

The EU budget for 2014-2020was agreed upon after long anddifficult negotiations. How doesIreland see it?The Multiannual FinancialFramework (MFF) is a keyissue. The funding for policiesand programs such as the Com-mon Agricultural Policy andCohesion Policy will have amajor impact on our future.We want to ensure that futurefinancing supports sustainablegrowth, innovation and keyinfrastructural projects, whilepromoting employment andsocial inclusion.

Ireland will seek to securethe consent of the EuropeanParliament for the adoption ofthe budget. We will lead thenegotiations with the Euro-pean Parliament on each of thenearly 70 legislative measuresnecessary to give practicaleffect to the agreed budget.

Given its preoccupation withhandling the economic crisis,how do you see Europe’s rela-tions with the world?Of course, Europe’s recoverycannot happen in isolation.Europe needs to look outsideits borders and engage with itsglobal partners. During itsPresidency, Ireland will fullysupport Catherine Ashton, theUnion’s High Representativefor Foreign and Security Policyand the European ExternalAction Service in strengthen-ing the effectiveness of theEU’s external policy, respond-ing to challenges in foreignpolicy and ensuring security.

Trade is a major driver ofgrowth. Thirty million jobs,about 10 percent of the EU’sworkforce, depend on exports.

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A strong package of tradeagreements could add 2 per-cent to EU growth rates. Wehope to build momentum inthe negotiations between theEU and third countries so thatour exporters can have betteraccess and greater opportuni-ties. We would like to con-clude trade agreements withCanada and Singapore. OurPresidency also wants to

advance free trade negotia-tions with Japan, India andother strategic partners, andalso the EU-China relation-ship. We will place a specialfocus on the EU-US traderelationship.

You mention EU-US links.What are the main factors inthe Irish-US relationshiptoday and how do you see EU-US trade relations today?Ireland has traditionallyenjoyed a close relationshipwith the United States. Wehave close ties regarding histo-ry, family, culture and, morerecently, vital economic andcommercial links.

On the basis of this rela-tionship, we feel that we arewell-positioned to contributeto deepening the relationshipbetween the EU and US. Twoof the world’s largest tradingblocs, they already have verystrong trading and investmentties. The successful future con-clusion of a free trade agree-ment with the US would havea significant and positiveimpact, resulting in new mar-kets for European exporterswith knock-on positive effectson job creation, a key objectivefor us. The Irish Presidencywill work towards a new gener-ation Trade and InvestmentAgreement between the EUand the US.

How do you assess the currentPolish-Irish relationship?

Ours is, by and large, a newrelationship but it is a strongone which I am sure will last.Tens of thousands of young,dynamic and entrepreneurialPoles have come to work inIreland over the last decade.Perhaps as many as 150,000currently live in Ireland –which explains why Polish isnow the second-most spokenlanguage there.

The Irish-Polish economicand commercial relationship issubstantial and mutually bene-ficial. Bilateral trade in goodsand services is valued at closeto €2 billion annually. Irishexports to Poland have beengrowing steadily in recentyears, notwithstanding theeconomic turmoil in Europe.Our exports increased byabout 15 percent last year, tosome €700 million.

Poland is the 8th-largestmarket for indigenous Irishcompanies. We estimate Irishdirect investment in Poland at€1.5 billion and Irish compa-nies employ some 4,500 peo-ple. Our links at the politicallevel are excellent – many IrishGovernment Ministers cameto Warsaw in the run-up to ourPresidency. And, let’s not for-get the vibrant and growingIrish community in Poland,including many Irish businesspeople and students.●

This is an abridged version ofour interview. For the full discus-sion, log on to WBJ.pl this week

Ambassador Eugene Hutchinson

LLOOKKAALLEE IIMMMMOOBBIILLIIAAW 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 FEB 25 – MAR 3, 2013, LI 18/07

GE real estate

taken over by

Valad Europe

London-based investment

fund Valad Europe has

acquired €570 million

worth of Polish retail real

estate from GE Capital

Real Estate. The

properties comprise six

shopping centers in

Poland’s biggest cities,

including Warsaw, Kraków

and Wroc∏aw.

Konsalnet

Holding to

change HQSecurity company

Konsalnet Holding will

move to a new office

building that will be

erected on ul. Jana

Kazimierza in Warsaw’s

Wola district by developer

Laris Investments, part of

the Elektrim Group. The

9,000 sqm building is

scheduled for completion

in the third quarter of

2014.

MEC moves to

Diamond

Business Park

Gliwice

Messer Eutectic Castolin

will move to Diamond

Business Park Gliwice, a

46,000-sqm industrial

park owned by

AIG/Lincoln. A new

building will be

constructed for MEC to

fit its executive offices, a

training center, a

manufacturing plant and

warehouse space

totaling nearly 5,000

sqm. ●

Offices in historic buildings . .17

Universal to be demolished . .17

Nowy Mokotów launched . . . .18

Waryński's plans for Wola . . . .18

Europa Centralna to open . . . .18

Warsaw office market . . . . . . .18

In this issue

1818

Echo Investment has launchedconstruction on its NowyMokotów residential project

Former machine producerWaryƒski plans two huge developments in Wola

Offices

Prestigious offices move to historic sitesWarsaw’s historicbuildings attractinvestors as potentialoffice space

Following a trend whoserecent examples includeWarimpex’s refurbishment ofa pre-war tenement houses onul. Pró˝na, more of the capi-tal’s historic buildings arebeing turned into office build-ings.

Centrum Bankowo-Finan-sowe “Nowy Âwiat” is tolaunch construction of its new9,270-sqm five-storey officebuilding between the DomPartii – the former communistparty headquarters – and thetenement houses on ul.Ksià˝´ca. The investment willbe situated on ul. Nowy Âwiat,ranked 43rd in Cushman &Wakefield’s list of the world’s62 most expensive high streets.

The development will be adiscreetly elegant, glass-lay-ered scheme, designed byAndrzej M. Ch∏odzyƒski’sarchitect studio. Situated nearPl. Trzech Krzy˝y and theRondo de Gaulle’a round-

about, it will offer 4,050 sqm ofGLA and 1,870 sqm of retailspace. The scheme will includean underground parking lotfor 40 cars and a separateunderground garage buildingfor 160 cars.

Kamienica KrasiƒskichMeanwhile, work is progress-

ing on the construction site ofHochtief Development Po-land’s new office project nearPl. Ma∏achowskiego and Pl.Pi∏sudskiego in the heart ofWarsaw, near the RoyalRoute. The investment in-volves the refurbishing of theKamienica Krasiƒskich his-toric tenement house as well

as the construction of a newwing facing the Academy ofFine Arts.

The estate, KamienicaKrasiƒskich, also known as theRaczyƒskich tenement house,will regain its original facadeand display windows on its firsttwo floors, as per requirementsset by the city’s historic curator.

Kamienica Krasiƒskich,one of the city’s most well-known pre-war schemes, wasdesigned by renowned archi-tect Jan Heurich and con-structed in 1907-1910.Destroyed during the WorldWar II, it was later rebuilt withslight alterations – without itsbig display windows – andserved as the seat of the thenMinistry for Post and Telegra-phy before it was sold to DomDevelopment for z∏.100 mil-lion and then resold toHochitef.

The investor decided thebuilding would host offices aswell as luxury retail units andrestaurants on its first twostoreys. Together with the newwing, it will comprise 13,956sqm of leasable space; 12,533sqm will be designated for officearea. The scheme, scheduled forcompletion in Q3 2014, will alsooffer about 100 parking spaceson two underground levels.

The investor wants tobreathe new life into the pic-turesque pre-war area of Pl.Ma∏achowskiego

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Centrum Bankowo-Finansowe’s planned office building on ul. Nowy Âwiat in Warsaw

Office

UUnniivveerrssaall sseett ttoo bbee ddeemmoolliisshheeddA new 80-meterskyscraper will replacethe soon-to-be-demolished Universalbuilding in the centerof Warsaw

The 50-meter Universal build-ing, located behind the famousRotunda PKO building in theheart of Warsaw, will be soldnext week by the bankruptcytrustee of Metro-Projekt,Andrzej Brzeziƒski.

The 48-year-old scheme isexpected to be demolished bya buyer that could build a new80-meter skyscraper in itsplace. The price of the pur-chase is expected to amount toat least z∏.110 million.

Any new scheme that goesup in place of the Universalbuilding is likely to be one ofthe most expensive and presti-gious office investments in thecity. A few of months ago cityauthorities issued buildingpermit for a new 70-meterproject, but now they claim thenew project could be evenhigher.

The Universal building wasbuilt in 1965 as Universal For-eign Trade Center, the onlyimporter of foreign householdappliances in the communistera. It was part of Warsaw’s so-called Eastern Wall (ÂcianaWschodnia), formed by theRotunda building, which hostsone of bank PKO BP’s best-known branch offices, and

three residential towers.In 1999 the building was

bought by Kraków-based com-pany Code for z∏.60 million andafter a couple of days was resoldto another company, Metro-Projekt, which offered z∏.84 mil-lion. Metro-Projekt wanted todemolish Universal and to erecta modern office building therebut never followed through withthe plans. The company wentbankrupt in 2002.

For the past couple of yearsthe building’s west-facingfacade has been covered withlarge-scale advertisements. It ishoped that a new high-rise res-idential scheme will improvethe appearance of the area.

The tender for the buildingwill be held on March 1.

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

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The Universal building was erected in 1965

FEBRUARY 25 – MARCH 3, 2013LLOOKKAALLEE IIMMMMOOBBIILLIIAA –– RREEAALL EESSTTAATTEE18 www.wbj.pl

Residential

EEcchhoo IInnvveessttmmeennttllaauunncchheess NNoowwyy MMookkoottóóww The residential projectin Warsaw willcomprise 700apartments

Warsaw Stock Exchange-listeddeveloper Echo Investmentrecently launched constructionon its Nowy Mokotów multi-family residential project,located on ul. Konstruktorskain Warsaw’s Mokotów district.

The investment will com-prise 700 apartments in sixbuildings and is scheduled forcompletion within the next sixyears. The estate is located inthe capital’s popular S∏u˝ewiecPrzemys∏owy business district,where the company is alsodeveloping its Park Rozwojuoffice complex. All of thebuildings consist of five to ninefloors and are connected by athree-storey base.

Apartments on the groundfloor will have gardens andthose on top floors will havespacious terraces. The remain-ing apartments will have log-gias and balconies. There isalso an underground parkinglot equipped with a specialsecurity system that allows carswith LPG installations to use itas well.

Nowy Mokotów wasdesigned by the APA Kury∏ow-icz & Associates architecturalstudio. “We focused on the

most important priorities of theresidential development in alarge city,” said Ewa Kury∏ow-icz, the firm’s vice president.

“Each such estate needs tohave its own characteristic fea-ture, which allows its residentsto identify with the placethrough architecture,” sheadded. “So we are dealinghere with urban villas, whichhave been designed to main-tain spaciousness and individ-uality. Residents will certainlynot have to live the lives oftheir neighbors all the time,but the layout of the projectwill encourage integration.”

Nowy Mokotów is EchoInvestment’s latest residentialproject in Warsaw. Theinvestor’s current offer includesluxury apartments in KlimtHouse on ul. Kazimierzowskain Warsaw’s Mokotów district.

One of the largest propertyinvestors and developers withPolish capital operating inEurope, Echo Investment hascompleted more than 90 proj-ects in Poland to date, with atotal of over 800,000 sqm ofspace. The company is alsoactive in the Romanian, Hun-garian and Ukrainian markets.

KKaarroolliinnaa KKoowwaallsskkaaThe former machineproducer has plans fortwo huge complexes inthe western Warsawdistrict

Grupa Waryƒski is planningtwo major projects in War-saw’s Wola district, one ofwhich will include two mixed-use developments and theother an office complex.

More than 100,000 sqm ofapartments and offices will beavailable in the mixed-use res-idential and office estate.Grupa Waryƒski is planning tobuild the scheme on a seven-hectare plot on ul. Jana Kaz-imierza. Office space is expect-ed to account for around 20percent of the total volume.

The company recentlysigned an agreement withdevelopers Polnord and Dan-tex, its partners in the invest-ment. The detailed schedulesof the developments will beprepared within the next fewmonths, as the investment iscurrently at the planning stage.

Waryƒski Group will decideon the design, general con-structor and the budget. Con-struction is expected to launchat the turn of 2013 and 2014.Grupa Waryƒski’s representa-tives said that the company isplanning to complete all phas-es of the two projects withinthe next six to eight years.

Nearby, the firm is alsoplanning to erect an officecomplex. The 9,000-sqmdevelopment will be situated

at the intersection of ul. JanaKazimierza and ul. Ordonaand will comprise two adjoin-ing buildings – one five storeyshigh and the other 10. Thescheme will be designed by theS.A.M.I. Architekci MariuszLewandowski i Wspólnicy stu-dio. Waryƒski officials say theinvestment should obtain aconstruction permit inSeptember and should becompleted in Q1 2015.

Formerly a constructionmachinery producer, GrupaWaryƒski wants to becomeincreasingly active in the prop-erty market in the upcomingyears. The company plans todeliver a 9,000-sqm officebuilding in Warsaw’s Wola dis-trict in the first half of 2015.

KKaarroolliinnaa KKoowwaallsskkaa

Residential

WWaarryyƒƒsskkii aaccttiivvee iinn WWoollaa

One of the biggestretail centers inCentral EasternEurope will open thisweek

Developer Helical Poland hasrecently been granted an occu-pancy permit for its EuropaCentralna retail park on ul.Paszczyƒska 315 in Gliwice,Silesia voivodship, in southernPoland. The grand opening hasbeen scheduled for March 1.

With its 70,000 sqm of

retail area, Europa Centralnais one of the biggest integratedretail centers in the CEEregion. Designed by Pracown-ia Architektoniczna Czora &Czora and constructed byPolimex-Mostostal for z∏.181.6million, it comprises a 28,000-sqm shopping mall, a 38,000-sqm retail park and a parkinglot with 2,300 spaces.

The shopping mall will beanchored by a 10,800-sqmTesco hypermarket, and theretail park by a 9,500-sqm Cas-torama DIY store. Other ten-

ants include Saturn, Jula,Smyk, Reserved, H&M, Kap-pAhl, Cubus, Empik, CCC,Deichmann, Wojas, MediaExpert and Super-Pharm. Thecenter is now 80-percentleased.

Founded in 2005, HelicalPoland is a subsidiary compa-ny of Helical Bar, a Britishproperty development andinvestment company. HelicalPoland specializes in buildinglarge shopping malls and retailcenters.

KKaarroolliinnaa KKoowwaallsskkaa

Retail

Europa Centralna to open March 1

CO

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F E

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The project includes six buildings, each from five to

nine storeys

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Waryƒski’s office complex in Wola is scheduled for completion in Q1 2015C

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Europa Centralna will be anchored by a 10,800-sqm Tesco hypermarket

The office marketperformed well lastyear and more of thesame is expected for2013Warsaw is the 33rd most-expensive location for officespace according to Cushman &Wakefield’s Office SpaceAcross the World ranking,which monitors trends andpractices in the market.

Rents in Poland grew by 2percent last year, reaching amonthly average of €26.50 persqm.

According to the advisory,the Polish office market per-formed well in 2012 in terms ofactivity levels and demand foroffice space throughout theyear.

With the domestic economyoutperforming most of Europe,tenant demand remained high,keeping prime rents in Poland’smajor cities steady or slightlybuoyant. The company predicts

that 2013 will see similar condi-tions, despite slowing economicgrowth.

London’s West End is onceagain the most expensive officedistrict in the world.

Globally, prime office rentsrose by 3 percent in 2012, butthis was largely driven byimpressive levels of growth in

South America, particularlyBrazil and Colombia.

Despite the global increasein rent levels, the continuingeconomic uncertainty under-mined prime rent levels in somecountries by making occupantsmore cautious and less eager toexpand or upgrade their prem-ises. KKaarroolliinnaa KKoowwaallsskkaa

Office

Warsaw among the mostexpensive officelocations in the world

CO

UR

TE

SY O

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IA C

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Office space doesn’t come cheap in Warsaw

FEBRUARY 25 – MARCH 3, 2013 TTHHEE LLIISSTT www.wbj.pl 19

Construction & Real Estate

Property and Facility Management CompaniesRanked by total gross building area (GBA) managed as of February 2013 www.bookoflists.pl

A guide to Polish business and industry Przewodnik po polskim biznesie i gospodarce

Rank

Company nameAddressTel./FaxE-mailWebsite

Services: PM /FM

Gro

ss b

uild

ing a

rea

(GB

A)

managed (

sqm

):

Ow

ned b

y com

pany

/N

ot

ow

ned b

y com

pany

/To

tal

Tota

l num

ber

of

build

ings

managed:

Ow

ned b

y com

pany

/N

ot

ow

ned b

y com

pany

/To

tal

Gro

ss b

uild

ing a

rea

(GB

A)

managed: P

M(s

qm

):

Ow

ned b

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pany

/N

ot

ow

ned b

y com

pany

/To

tal

Num

ber

of

build

ings

managed: P

M:

Ow

ned b

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pany

/N

ot

ow

ned b

y com

pany

/To

tal

Gro

ss b

uild

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rea

(GB

A)

managed:

FM (

sqm

):

Ow

ned b

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pany

/N

ot

ow

ned b

y com

pany

/To

tal

Num

ber

of

build

ings

managed: FM

: O

wned b

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pany

/N

ot

ow

ned b

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pany

/To

tal

Services offered Buildings managed Selected clients

Tota

l num

ber

of

em

plo

yees

/Ye

ar

founded in P

ola

nd

Top local executive /Title

1

Sodexo Polska Sp. z o.o.Al. Jerozolimskie 172, 02-486 Warsaw22 338-9600/22 338-9601info.fms.pl@sodexo.comwww.sodexo.pl

-✓

-3,750,0003,750,000

-183183

---

---

-3,750,0003,750,000

-183183

Technical maintenance;cleaning; energy

management; security;administration support;

mobile services; maintenanceof outdoor areas; waste

management

North Gate (Warsaw);Metropolitan (Warsaw);

Company House II - Microsoft(Warsaw); Crown Square

(Warsaw)

Deka Immobiien; Cushman &Wakefield Polska; AXA RealEstate; INVESCO Real Estate

2,0931993

Yann GontardCEO Central Europe

2

Dalkia Energy & TechnicalServices Sp. z o.o.Al. SolidarnoÊci 46, 61-696 Poznaƒ61 829-9260/61 829-9288dets@dalkia.plwww.dalkia.pl

-✓

-2,529,8382,529,838

-6868

---

---

-2,529,8382,529,838

-6868

Comprehensive energy andtechnical services

ABB (Aleksandrów ¸ódzki;¸ódê); Tulipan Park (Stryków;Komorniki; Plewiska; Gliwice;

Tychy); Factory (Wroc∏aw;Luboƒ; Warsaw; Kraków);

Plaza (Lublin; Poznaƒ);Bonarka City Center; Dell

(¸ódê); Manufaktura (¸ódê)

ABB; SEGRO; Neinver/Irus;Klepierre; Trigranit; Dell;

Apsys

WND2004

Brice Mellies; KrzysztofSkowroƒski

President; Board Member

3

HOCHTIEF Facility ManagementPolska Sp. z o.o.ul. Powsiƒska 64A, 02-903 Warsaw22 858-8525/22 842-0473handlowy@hochtief.com.plwww.hochtief-fm.pl

-✓

-2,280,0002,280,000

-115115

---

---

-2,280,0002,280,000

-115115

Technical maintenance;administrative, infrastructural

services; low voltageinstallation services;

refrigeration services; blueFM;technical audit; technical

consulting

Faurecia Wa∏brzych; Rondo 1;Lipowy Office Park; BalticBusiness Center; Business

Park (Gliwice; ¸ódê;Piaseczno; Stryków)

Faurecia Wa∏brzych; BPTOPluton; RONDO Property

Investments

2881998

Artur TomczykPresident

4

DTZ Management Polska Sp. z o.o.ul. Z∏ota 59, 00-120 Warsaw22 222-3000/22 222-3001info@dtz.comwww.dtz.com/pl

✓-

-2,160,0002,160,000

-4646

-2,160,0002,160,000

-4646

---

---

Comprehensive PM services

Z∏ote Tarasy (Warsaw);Millennium Hall (Rzeszów);

Galeria Pomorska(Bydgoszcz); Mokotów Nova(Warsaw); Marynarska 12(Warsaw); Trinity Park II

(Warsaw)

CBRE Global Investors;Ghelamco; Corpus Sireo; ArkaBZ WBK; AIB; Balmain AssetManagement; Credit SuisseAsset Management; VALAD

WND1994

Patrick DelcolCountry Head

5

METRO Properties Sp. z o.o.Al. Krakowska 61, 02-183 Warsaw22 500-0000/22 500-0113info@metro-properties.plwww.metro-properties.pl

✓✓

-2,033,9012,033,901

-180180

-588,436588,436

-1313

-1,445,4651,445,465

-167167

PM: Project development;leasing; center management;

marketing; assetmanagement; FM:

Environmental services;technical services; energy

management

PM: Centrum Tulipan (¸ódê);Centrum Ster (Szczecin); M1Shopping Centers; Centrum

Ursynów (Warsaw); CentrumKometa (Toruƒ); FM: Plaza

(Ruda Âlàska; Rybnik); Gemini(Bielsko-Bia∏a); Makro; M1

Shopping Centers

Praktiker; GE Real EstateHoldings; Apollo Rida; Brico;

Pradera

4161996

Renata Kinde-Czy˝;Clemens Puehler

President; Board Member

6

POL-K ATALIAN Sp. z o.o.(Dawniej Pol-K Sp. z o.o.)ul. Âlàska 159/1, 32-080 Zabierzów12 258-0885/12 258-0886pol-k@pol-k.plwww.pol-k.pl

-✓

-2,000,0002,000,000

-210210

---

---

-2,000,0002,000,000

-210210

Comprehensive technicalmaintenance; cleaning;

outdoors areas maintenance;snow removal; cleaning andunblocking drains; separators

cleaning; constructionreviews; duct cleaning; cost

optimization

CH Arkadia (Warsaw); FrenchEmbassy (Warsaw);

Goodman Logistics Center(Niepruszew); Crown

production plants (Goleniów;Pruszcz Gdaƒski); Golden Tulip

Hotel (Warsaw)

Atrium; BNP Paribas;Goodman; Unibail-Rodamco;

DTZ

1602000

Katarzyna JahanProxy

7

Atrium 21 Sp. z o.o.ul. Stefana Batorego 20, 02-591 Warsaw22 825-9892/22 825-0440info@atrium21.plwww.atrium21.pl

✓✓

-1,300,0001,300,000

-120120

-1,290,0001,290,000

-117117

-10,00010,000

-33

PM: Administration;economic support andfinancial services; FM:

Cleaning; technicalmaintenance; consulting and

expert services

PM: WM Park Mokotów I(Warsaw); WM Suita

(Warsaw); WM Delicato(Warsaw); WM Cameratta(Warsaw); FM: Buildings onul. Stefana Batorego 14 and

20 (Warsaw)

WND82

1998Piotr Kuligowski

President

8

Knight Frank Sp. z o.o.ul. Mokotowska 49, 00-542 Warsaw22 596-5050/22 596-5051office@pl.knightfrank.comwww.knightfrank.com.pl

✓-

-1,160,0001,160,000

-7777

-1,160,0001,160,000

-7777

---

---

Full range of property andasset management services;

cost analysis; contractrenegotiation; tenders

organization

Intercontinental Hotel(Warsaw); North Gate

(Warsaw); Trinity Park III(Warsaw); Andersia BusinessCentre (Poznaƒ); Bema Plaza

(Wroc∏aw)

DEKA Immobilien; SEBInvestment; Arka WZWBKFundusz NieruchomoÊci;

Peakside PoloniaManagement; Invesco Real

Estate

1041995

Monika D´bska; Joseph Borowski;

Katarzyna BàczyƒskaPresident; Vice President;

Managing Director

9

Przedsi´biorstwo ZarzàdzaniaNieruchomoÊciami Sp. z o.o.ul. Niek∏aƒska 35, 03-924 Warsaw22 518-8800/22 518-8802sekretariat@pzn.com.plwww.pzn.com.pl

-✓

-1,150,0001,150,000

-2,4722,472

---

---

-1,150,0001,150,000

-2,4722,472

Facility management;technical maintenance;

cleaning; technical protectionof property

WNDBank Pekao; PKO BP; BankMillennium; BRE Bank; BZ

WBK

5691996

Jerzy ZalegaPresident

10

General Property Sp. z o.o.ul. Wiertnicza 34, 02-952 Warsaw22 642-1125/22 642-2303info@generalproperty.plwww.generalproperty.pl

✓✓

-1,100,0001,100,000

-4747

-66,00066,000

-44

-1,100,0001,100,000

-4747

PM: Lease contractmanagement; costoptimization; FM:

Comprehensive technicalmaintenance; construction

reviews; engineeringdescriptions

PM: Marki Industrial Park(Marki); Concept Tower(Warsaw); DSV-Miƒska(Warsaw); FM: Centrum

Finansowe Pu∏awska(Warsaw); Blue Point

(Warsaw); Eurocentrum(Warsaw); CH Turawa (Opole)

PKO BP; CaelumDevelopment; Renault Polska;Raben Polska; Uti Poland; Ret

Pro

1402004

Piotr GórnickiPresident

11

Cofely Services Sp. z o.o.ul. Kijowska 1, 03-738 Warsaw22 518-0186/22 518-0189cofely@cofely.plwww.cofely.pl

-✓

-1,020,0001,020,000

-470470

---

---

-1,020,0001,020,000

-470470

Technical maintenance;energy-efficient investments;

facility management

BRE (Kraków; Katowice;Bydgoszcz); Park Post´pu(Warsaw); Green Horizon(¸ódê); Henkel production

plant (Racibórz)

Echo; KBC; BRE Bank;Skanska; Arka BZ WBK; First

Property

2101997

Jan WoêniakPresident

12

Colliers International REMS Sp. z o.o.Pl. Pi∏sudskiego 3, 00-078 Warsaw22 331-7800/22 331-7801warsaw@colliers.comwww.colliers.com

✓✓

-803,750803,750

-4545

-753,750753,750

-4444

-50,00050,000

-11

PM: Comprehensive realestate services; asset

management; FM: Technicalmaintenance; building

maintenance

PM: Warsaw Financial Center(Warsaw); Platinium BusinessPark (Warsaw); Horizon Plaza

(Warsaw); GrunwaldzkiCenter (Wroc∏aw); Senator(Warsaw); FM: Warsaw

Financial Center (Warsaw)

IVG Poland; Allianz RealEstate/Tristan Capital

Partners; Union InvestmentReal Estate; GLL Real EstatePartners; RREEF Investment

772007

Monika Rajska-WoliƒskaManaging Partner

13

Warbud Vinci Facilities Sp. z o.o.Al. Jerozolimskie 162A, 02-342 Warsaw22 567-6313/22 567-6401warbudvf@warbud.plwww.warbud.pl

-✓

-713,275713,275

-6464

---

---

-713,275713,275

-6464

Technical maintenance;mobile service; budgetmanagement; cleaning;handyman; rebuilding;

arranging

Supreme AdministrativeCourt; Prosta Tower; Ferio

Wroc∏aw

Jeronimo Martins; Marvipol;Kronos

452010

Zbigniew KucharskiManaging Director

14

Jones Lang LaSalle Sp. z o.o.ul. Królewska 16, 00-103 Warsaw22 318-0000/22 318-0099warsaw.office@eu.jll.comwww.joneslanglasalle.pl

✓-

-674,312674,312

-5757

-674,312674,312

-5757

---

---

Comprehensive PM andaccounting services

Marynarska Business Park(Warsaw); Green Corner

(Warsaw); Point Park(Mszczonów); MarcredoCiechanów (Ciechanów);Centrum Handlowe BELG

(Katowice)

Aviva; Balmain; Elbfonds;Heitman; PointPark; Skanska

3451994

John DuckworthManaging Director CEE

15

Echo Investment Property Management Sp. z o.o., Sp.k.Al. SolidarnoÊci 36, 25-323 Kielce41 333-3606/41 333-2666biuro.pm@echo.com.plwww.echo.com.pl

✓✓

590,00055,375

645,375

19221

590,00055,375645,375

19221

156,000-

156,000

3-3

PM: Operationalmanagement; reports;

budgets; settlements; leasecontract management;

project service organization;project marketing;

commercialization support;FM: Technical maintenance

PM: Galeria Echo (Kielce);Pasa˝ Grunwaldzki (Wroc∏aw);

Galaxy (Szczecin); ParkPost´pu (Warsaw); Oxygen(Szczecin); Malta Office Park(Poznaƒ); FM: Galeria Echo

(Kielce); Galeria Olimpia(Be∏chatów)

Echo Investment;Immopoland

661998

Piotr GromniakPresident

Notes: FM = Facility Management, GBA = Gross Building Area, PM = Property Management,WND = Would Not Disclose. Research for The List was conducted in February 2013. Number ofemployees is as of February 2013. All information pertains to the companies’ activities in Poland.Only the 15 top companies are listed here - for full list subscribe at www.bookoflists.pl

To the best of WBJ ’s knowledge, the information is accurate as of press time. While every effort is made to ensure accuracy and thoroughness, omissions and typo-graphical errors may occur. Corrections or additions to The List should be sent, on official letterhead, to Warsaw Business Journal, attn. Monika Brysiak, ul. Elblàska15/17, 01-747 Warsaw, via fax to (+48) 22 639-8569, or via e-mail to wbjbol@wbj.pl. Copyright 2012, Valkea Media SA. The List may not be reprinted or reproducedin whole or in part without prior written permission of the publisher. Reprints are available.

FEBRUARY 25 – MARCH 3, 2013MMAARRKKEETTSS20 www.wbj.pl

SO

UR

CE

: W

SE

PLN-EUR

4.18

52

4.19

30

4.18

63

4.16

02

4.17

60

4.15

74

15.0

2

18.0

2

19.0

2

20.0

2

21.0

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22.0

24.1

4.2 PLN-USD

15.0

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20.0

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21.0

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22.0

2

3.13

98

3.14

10

3.13

60

3.10

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3.16

33

3.14

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3.0

3.2 PLN-GBP

15.0

2

18.0

2

19.0

2

20.0

2

21.0

2

22.0

2

4.86

20

4.85

84

4.85

85

4.75

13

4.81

66

4.80

37

4.7

4.9 PLN-CHF

3.40

61

3.40

24

3.39

49

3.37

28

3.39

60

3.37

97

15.0

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0.10

41

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0.1050 PLN-100JPY

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3.40

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3.34

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3.35

28

3.31

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3.38

84

3.37

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3.3

3.5

currency rates

Outlook upgrade

boosts z∏oty

Currency report

According to the FederalOpen Market Committeemeeting minutes releasedlast week, the US economy isimproving and the Fed isthinking about quitting itsasset-buyback program.While this isn’t about to hap-pen right now, it may occurthis summer. The reaction ofthe EUR/USD was abrupt.The main currency pair tum-bled from $1.34, the level ithad been hovering aroundfor the first part of the week,all the way to $1.32. TheFed’s statement was a sud-den turn of events fortraders, as previously onlyone FOMC member (JamesBullard) had opted fordecreasing the quantitativeeasing program.

Besides the US dollar, thez∏oty was also a gainer thispast week. The Fitch ratingagency affirmed Poland’s

credit rating at A- andupgraded its outlook to “pos-itive” from “stable.” Thisstopped the z∏oty fromdepreciating this past week,and could slow the process ofincreasing risk premiums thisyear.

The EUR/PLN, whichtraded close to the z∏.4.20resistance level, declined allthe way to z∏.4.15. TheUSD/PLN on the otherhand, from a weekly low ofz∏.3.09, climbed all the way toz∏.3.15.

The upcoming weeksthough could be tough forthe z∏oty. The market isawaiting a larger correctivemovement on US stock mar-kets, and if that happens, riskaversion will increasingly pullinvestors out of z∏oty-denom-inated assets and this willcause a larger depreciation ofthe z∏oty. ●

Adam NarczewskiX-Trade Brokers DM SA

SO

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: N

BP

Major indices

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

EFH 1.02 500.00 1.60 0.16HBPOLSKA 0.02 100.00 1.36 0.01MEXPOLSKA 1.44 38.46 10.89 0.85PBG 7.61 33.51 73.15 3.25INTROL 6.24 31.09 6.45 3.11

WIG 45,879.90 (February 21 close)

Change for the week: -0.72% 52-week high: 48,222.72

Change year to February 21: -4.63% 52-week low: 36,653.28

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

LOTOS 40.00 5.35 43.78 22.66PKNORLEN 53.15 4.83 54.05 31.44GTC 7.80 3.86 10.25 5.13SYNTHOS 5.63 2.74 6.40 4.64BORYSZEW 0.48 2.13 0.84 0.42

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

KBDOM 0.10 -37.50 0.21 0.09REGNON 0.03 -25.00 0.16 0.03BBICAPNFI 0.54 -21.74 1.17 0.51LIBRA 1.43 -18.29 2.39 1.26TFONE 1.68 -16.00 2.82 1.13

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

TAURONPE 4.27 -6.36 5.11 3.84KGHM 179.00 -4.69 194.80 92.14TVN 9.21 -3.15 11.69 5.90TPSA 6.78 -3.14 17.34 6.71BOGDANKA 129.60 -2.99 143.00 114.00

WIG20 2,436.47 (February 21 close)

Change for the week: -0.81% 52-week high: 2,628.36

Change year to February 21: -7.22% 52-week low: 2,035.80

mWIG40 2,566.08 (February 21 close)

Change for the week: -0.47% 52-week high: 2,646.20

Change year to February 21: -0.10% 52-week low: 2,147.52

sWIG80 10,948.88 (February 21 close)

Change for the week: -0.62% 52-week high: 11,245.80

Change year to February 21: 3.97% 52-week low: 8,984.43

NewConnect 32.54 (February 21 close)

Change for the week: -0.76% 52-week high: 43.72

Change year to February 21: -2.05% 52-week low: 32.13

WIG-Banki 6,382.67 (February 21 close)

Change for the week: -1.34% 52-week high: 6,723.16

Change year to February 21: -5.06% 52-week low: 5,163.30

DJIA13,880.62 (Feb 21 close)

-0.66% (for the week)

CHANGE: 3.49%

(year to Feb 21)

52-week high: 14,058.27

52-week low: 12,035.09

NASDAQ3,131.49 (Feb 21 close)

-2.10% (for the week)

CHANGE: 0.62%

(year to Feb 21)

52-week high: 3,213.60

52-week low: 2,726.68

S&P5001,502.42 (Feb 21 close)

-1.25% (for the week)

CHANGE: 2.74%

(year to Feb 21)

52-week high: 1,530.94

52-week low: 1,266.74

FTSE1006,291.50 (Feb 21 close)

-0.57% (for the week)

CHANGE: 4.38%

(year to Feb 21)

52-week high: 6,412.40

52-week low: 5,229.80

DAX7,583.57 (Feb 21 close)

-0.62% (for the week)

CHANGE: -2.51%

(year to Feb 21)

52-week high: 7,871.79

52-week low: 5,914.43

NIKKEI11,309.13 (Feb 21 close)

0.02% (for the week)

CHANGE: 5.81%

(year to Feb 21)

52-week high: 11,510.52

52-week low: 8,238.96

world stock indices

40,000

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10,000

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32.0

32.6

33.2

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34.4

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25.0

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2 5,900

6,060

6,220

6,380

6,540

6,700

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Other indices

WIG continues tounderperform

Stocks report

Polish equities saw littlereprieve last week, continuinga slide from the week priorwhen both the WIG shed 0.79percent and the WIG20 1.1percent.

Monday saw a mini-rallythat was short-lived, withboth the WIG and WIG20climbing about 0.3 percent.Shares of Polish telecom TPfinally saw a rebound (up 2.8percent) after losing close to50 percent of their valuebetween February 11 and 15.

On Tuesday, Polish sharesunderperformed their Wes-tern counterparts. Sharesthroughout Europe saw gainsafter Germany’s investor con-fidence index, ZEW, reportedbetter-than-expected results.It was the third monthlyincrease. But the optimism inGermany did not get Polishinvestors too excited, with theWIG closing relatively flat,

while the WIG20 reported amere 0.05 percent gain.

Wednesday, too, saw Pol-ish shares perform poorly,with the WIG20 shedding1.37 percent, while the WIGclosed nearly 1 percent lower.Fears that France’s credit rat-ing would be slashed pushedindices lower.

Thursday saw Polishshares trading better thantheir regional peers afternews that Fitch upgraded itsoutlook for Poland’s creditrating helped both the WIGand WIG20. Nevertheless,both ended up sheddingclose to a quarter of a per-cent on the day.

On Friday, the two mainindices recorded modestgains, with the WIG up 0.15percent and the WIG20 up0.03 percent, as the optimismfollowing the outlook up-grade continued. ●

Andrew Nawrocki WBJ market analyst

FEBRUARY 25 – MARCH 3, 2013 SSPPOORRTTSS www.wbj.pl 21

Soccer

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American football

EEaagglleess mmoovviinngg ttooPPoolloonniiaa ssttaaddiiuummWarsaw’s top-leagueAmerican football teamwill share the 6,800-seat stadium withPolonia Warszawa

Last season the Warsaw Eagles,Poland’s oldest American foot-ball team, played their games atOSiR Bemowo – a new, but fair-ly small venue with artificial turf.Its capacity of a mere 1,000 seatscould barely hold the club’s fans.On average the games wereattended by 920 people.

Club owners felt they hadoutgrown the stadium andneeded to move to a biggerspace, especially after playing inthe Topliga final at the NationalStadium in front of 23,000 peo-ple (where they lost to Sea-hawks Gdynia).

For years the stadium on ul.Konwiktorska has been synony-mous with soccer and withPolonia Warszawa. The“Czarne Koszule” or “BlackShirts” have been playing theresince 1928. Even though its offi-cial name is Polonia Warszawastadium, it’s not the property ofthe club, but is in fact owned bythe city and leased to the team.

That’s why, even though ini-tially Polonia protested theEagles’ move to the facility, infear of the field beingdestroyed, they couldn’t blockthe decision. WOSiR (a city-run department that managesthe facility) reassured the soc-cer club that the condition ofthe field won’t deteriorate.

The Warsaw Eagles signedthe deal for the upcoming sea-son, and will be paying WOSiRz∏.22,000 per game, while Polo-nia pays twice as much.

“We understand that the dif-ference is significant, but weknow each other’s abilities,”said WOSiR’s director JanuszKopaniak.

The average attendance forCzarne Koszule games in thelast round was 4,400. TheEagles expect that 2,000-4,000fans will come to their games onul. Konwiktorska. In the firstgame of the season on April 6,Eagles will take on their rivalsDevils Wroc∏aw.

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The Polishgoalkeeper’s form hasdipped this season

Polish international goalkeeperWojciech Szcz´sny has comeunder strong criticism for hisperformances for PremierLeague side Arsenal in recentweeks.

First came a mistake againstBlackburn Rovers that led tothe second-tier-league sideknocking the Gunners out ofthe FA Cup. Arsenal had com-pletely dominated the match,despite being unable to find theback of the net. Finally, MrSzcz´sny failed to deal with ashot from Blackburn’s MartinOlsson, and only managed toparry the ball into the path ofthe Rovers’ Colin Kazim-Richards. He fired the ball pastthe stranded Polish keeper togive Blackburn victory.

Then, in last week’s Champi-ons League round of 16 matchwith Bundesliga giants BayernMunich, Mr Szcz´sny allowedthree goals, with the 3-1 scoreline virtually ending Arsenal’sinvolvement in the tournamentwith the second leg still to play.The Pole could do little about

the first and third goals, but wasagain at fault at the 21-minutemark when he parried a Danielvan Buyten header straight atThomas Müller, enabling theGerman midfielder to blast theball into the Arsenal goal.

Following another less-than-convincing performance, specu-lation is mounting that the 22-year-old may be replaced in the

summer, with Arsene Wengerfinally losing patience with hiserratic goalkeeping.

Stoke City’s Simon Migno-let is being touted as the mostlikely replacement. The Belgianinternational has been ininspired form for one of thePremier League’s tightestdefenses this season.

DDaavviidd IInngghhaamm

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Wojciech Szcz´sny (front left)

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Warsaw Eagles games attracted 920 fans on average

last year

FEBRUARY 25 – MARCH 3, 2013LLIIFFEESSTTYYLLEE22 www.wbj.pl

Patrick Wolf (acoustic)March 2Palladiumul. Z∏ota 9Warsaw

English singer-songwriterPatrick Wolf is already sixalbums into his career at just29 years old. His songs oftenmix classical musical ele-ments with electronic sam-

ples, with the singer playing avariety of instruments includ-ing ukulele, piano, keyboardsand viola.

As a result, his music isvery eclectic. Some of hissongs, which often focus onlove and desire, fit into gen-res such as romantic folk,pop, techno and dance.

For his current tour,which celebrates 10 years in

the business, he’s strippingback the technology to play astrictly acoustic set. This is topromote his latest release“Sundark and Riverlight”which contains the besttracks of his career so far, re-recorded using acousticinstruments.

DDaavviidd IInngghhaammFor more information,

log on to palladium.art.pl

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Tadeusz Rolke:Tomorrow Will Be BetterGaleria Le GuernUntil April 24ul. Widok 8Warsaw

This photography exhibitionhighlights Poland’s transfor-mation period of the early1990s – the first years afterthe end of communism.Focusing on the work of Pol-ish photographer TadeuszRolke, it details the often dif-ficult combination of pervad-

ing remnants of the oldregime with a belief in newpossibilities and an enthusi-asm for change that emergeduring this time in history.

Taken mostly between1990 and 1992, the photo-graphs include commissionedpieces as well as the artist’sown personal images, helpingto document the changingnature of Polish society,which included rampantinflation and a growing dis-parity between rich and thepoor.

Mr Rolke was particularlyinterested in local and tran-sient phenomena rather thanthe increased commercializa-tion of the era – unbridledadvertising and the large vari-ety of products were nothingnew to him, since he lived inWest Germany in the 1970sand 1980s.

The exhibition alsoincludes other work from theartist’s long career.

DDaavviidd IInngghhaammFor more information,

log on to leguern.pl

Exhibition

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Mr Rolke was interested in local and transient phenomena

Concert

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These are strange days for the videogame industry. Less than a decadeago, analysts were predicting thedeath of PC gaming, while the con-sole market was dominated by threefirms – Microsoft, Nintendo andSony. The latter two ruled the hand-held gaming market, uncontested.

Then came smartphones. Andtablets. These devices, with theirtouchscreens and byte-sized, low-priced apps, have proven fierce com-petition for the handheld-gaming sec-tor. They’re also a nascent threat tothe still-not-dead PC-gaming sector.

Pity the incumbents in this strug-gle, such as Nintendo. Today the firmfares better than Sony in the handheldmarket, but its Wii U console, a tech-

nical lightweight (for its generation)which leans heavily on a touchscreen-enabled controller, is underperform-ing badly.

Launching in Q4 2012, Nintendobet that consumers would be raven-ous for the first new console hardwarein six years. Judging by the sales fig-ures, it was wrong. In fact, the Wii U’sstartlingly poorperformance hassome experts ques-tioning the futureof a companythat’s been in thegaming industrysince freaking1889.

This is the kind

of slippery, unpredictable market thatSony and Microsoft are also trying toremain atop. Microsoft has beenquiet to date, but Sony finally made itsmove last week.

At its first event dedicated to thepredictably named PlayStation 4(PS4), Sony made it crystal clear that“social” is key to the experience it

wants to provide, as evidenced by adedicated “share” button on the PS4controller. The console has “alwayson” video compression and decom-pression to make uploading gameplayvideos simpler, and it offers new pos-sibilities for cooperative play.

In addition to the share button, theDualshock 4 controller incorporates

motion-detection hardware, aspeaker and a small touchpad,broadening the palette for inter-activity in games. Anotherperipheral that Sony showed off,the Playstation 4 Eye, aims toprovide the same kind of motion-sensing/webcam/voice commandexperience as the popular Kinecthardware from Microsoft.

We didn’t actually get to seethe console unit last week, butSony announced that it is ditch-ing the PS3’s Cell processorarchitecture in favor of an eight-

core, x86-64 AMD chip. That’s likelyto please game developers, as the Cellchip has a reputation as powerful buttricksy to program for. The AMDarchitecture, meanwhile, is much clos-er to what you find in a PC (and anXbox), which should make multi-plat-form game development easier.

Truth be told, the hardware side of

the PS4 is OK – sassier than the Wii U,to be sure – but hardly exhilarating.The one big surprise is the addition ofa whopping 8GB of GDDR5 RAM,to be shared by system and graphicsuse. Compare that with the PS3, whichhas a meager 512MB of RAM splitequally between system and graphics.

Sony also wants to make it possibleto use a second screen while playing.But rather than forcing this on play-ers, as Nintendo does with the Wii Ucontroller, the firm will employ itsVita handheld or, smartly, let con-sumers use their own smartphones ortablets (via iOS or Android app). Andwhile the move to an AMD architec-ture makes backward compatibilitywith older games a technical night-mare, the firm plans to circumventthis by streaming games via the cloud.

Finally – and most crucially for theconsole’s long-term health – thereseems to be plenty of developer sup-port for the PS4. Major talent likeBlizzard (Diablo 3), CD Projekt RED(The Witcher 3) and Bungie(Destiny) plan to bring their games tothe console.

The PS4 is expected to launch inNovember. Will it prove to be Sony’ssalvation? Like the console itself, thisremains to be seen. ●

FEBRUARY 25 – MARCH 3, 2013 LLAASSTT WWOORRDD www.wbj.pl 23

SSoonnyy sshhoowwss ooffff tthhee PPSS44.. KKiinndd ooff..Tech Eye

Ever ruled a market, uncontested? Let us know: techeye.wbj@gmail.com

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

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

Fibak Galleryul. KrakowskiePrzedmieÊcie 5www.galeriafibak.pl

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

Galeria 65 ul. Bema 65www.galeria65.com

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

Galeria Asymetria ul. Nowogrodzka 18awww.asymetria.eu

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

Galeria Milano Rondo Waszyngtona 2Awww.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 52www.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

Source: Sony* All specs refer to status at launch. The most recent PS3 consoles no longer have backward compatibility.

The hardware in thereA quick comparison of Sony’s current and next-gen consoles

PS4* PS3*

CPU “Jaguar”: single-chip x86-64 AMD with 8 cores “Cell”: multi-core chip

Memory 8GB GDDR5 256MB of XDR DRAM (system) / 256MB GDDR3 RAM (video)

Hard-drive Built-in, size unknown Built-in, 20/60GB

Optical drive 6x Blu-ray and 8x DVD 2x Blu-ray and 8x DVD

Input/output Super-Speed USB 3.0, Aux (for PS4 Eye) USB 2.0, Aux

Backward compatibility No (later streaming via cloud) PS2 games (and some PS1)

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