Polish Market No. 3 (176) 2011 by Polish Market

Polish Market :: 03/2011

15 YEARS

PUBLISHED SINCE 1996 No. 3 (176) 2011

www.polishmarket.com.pl

SCIENCE AND INNOVATION Pharmacy and Medicine Higher Education Cooperative Banking

Prof. Henryk Skarżyński

challenges and achievements

The Medical University of Warsaw is one of the oldest medical schools in Poland. For 200 years it has provided education and training in medicine and pharmacy at undergraduate and postgraduate levels. The programmes satisfy the highest international standards of university-level education and are based on the principles of good clinical and pharmaceutical practice. The Medical University of Warsaw provides specialist referral tertiary and general services and undergraduate and postgraduate teaching in its five affiliated teaching hospitals, which are also involved in scientific and clinical research: • Public Central Teaching Hospital • The Infant Jesus Teaching Hospital – Emergency and Trauma Centre • Public Ophthalmic Teaching Hospital • Public Paediatric Teaching Hospital • Duchess Anna Mazowiecka Public Teaching Hospital – a specialist gynaecological and maternity hospital and a number of clinical academic departments located in other hospitals in Warsaw.

www.wum.edu.pl

Contents

3/2011 Prof. Marek Krawczyk, Rector of the Medical University of Warsaw: Technology transfer underway # 24 From The President’s Press Office

From The Government Information Centre

# 26

Private healthcare networks

Anna Rulkiewicz, President of the LUX MED Group: Recount of 2010 in the medical industry # 28

OUR GUESTS Prof. Michał Kleiber, President of the Polish Academy of Sciences (PAN) # 8

Prof. Krzysztof J. Kurzydłowski, Director of the National Centre for Research and Development # 10 Prof. Barbara Kudrycka, Minister of Science and Higher Education # 12 Alicja Adamczak, PhD, President of the Polish Patent Office # 14 Bożena Lublińska-Kasprzak, President of the Polish Agency for Enterprise Development # 15

Polish Market Honorary Pearls

# 30

2011 – The year of Maria Skłodowska-Curie

# 32

Małgorzata Okularczyk, Head of Public Consulting Section, Collect Consulting: Science and technology parks – role, eﬀectiveness # 34 Elżbieta Wojnicka PhD, Institute of Organisation and Management of the University of Gdańsk: Innovation dilemmas of Polish businesses # 36 Prof. Stanisław Bielecki PhD, DSc, Rector of the Technical University of Lodz: Does business see the need to make use of scientiﬁc breakthroughs # 40 Polish universities in the Webometrics ranking

# 44

Prof. Katarzyna Chałasińska-Macukow, Rector, University of Warsaw: Learning for business # 46

SCIENCE AND INNOVATION Professor Henryk Skarżyński, the creator and founder of the International Centre of Hearing and Speech in Kajetany: Challenges, knowledge, consistency, success # 16 Marcin Rudnicki, head of the pharmaceutical team at KPMG and Karol Kołt, chief executive at PMR: Good prospects for Polish pharmaceutical industry # 20 Iwona Stefańczyk, Consultant at Proﬁles International BIGRAM SA Personnel Consulting: Most Productive Companies # 22

Prof. Wiesław Banyś PhD, DSc, Rector of the University of Silesia in Katowice: We teach to think out of the box # 48 Tadeusz Pomianek, Andrzej Rozmus: The lack of competition mechanisms damages Polish universities and isolates them from the economic environment # 50 Private universities oﬀering PhD programmes WCAT and it’s mission

# 51

# 54

Professor Andrzej Karbownik PhD, DSc (Eng) Rector of the Silesian University of Technology: Open for cooperation # 56

Major events in March 2011 with “Polish Market” as a media partner: The 14th International Power Industry Fair ENEX, Kielce

CeBIT 2011, the world’s leading ICT tradeshow, Hanover, Germany

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PowerPol, the Polish Energy-Heating Industry Congress, Kazimierz Dolny, Poland ITB, the world’s biggest tourism fair, Berlin, Germany

The 3rd Football Business Conference, the most important business and football event in Central and Eastern Europe, Warsaw

The 3rd International Energy Efficiency Forum. Less Means More, Warsaw

EWEA, the European Wind Energy Conference and Exhibition, Brussels, Belgium The Technology Awards Presentation Gala of “Gazeta Bankowa,” Warsaw

The 4th International Conference on Innovation and Creativity of Women for Economic Development, Warsaw

The CEE Banking Summit, Warsaw

Contents LAW & TAXES

EURO 2012

Maja Sujkowska, Chairperson General Partner’s Board at European Center for Legal Consultations: Study facilities and support for foreigners in Poland # 57

REAL ESTATE AND CONSTRUCTION Anita Rajchelt, Senior Surveyor, Capital Markets Group, Cushman & Wakeﬁeld: The Polish property investment market vs. Central and Eastern Europe markets # 83

Tomasz Grzegorzewski, the attorney at law at Chałas & Partners Law Firm: Sometimes you do not have to do anything to bind yourself by a trade contract # 58

FINANCE

# 76

Construction: waiting for better times

POWERFUL BUSINESSWOMEN Maciej Stańczuk, President of the Polish Entrepreneurship Bank: A bank created after the crisis # 59 Good things come in small packages

Nina Kowalewska-Motlik

# 85

# 60

Danuta Kowalczyk, President of the Management Board of Mazowiecki Bank Regionalny SA in Warsaw: We unite to expand our options # 64

CEO AFTER HOURS Andrzej Krzemiński, President of the Management Board of EFL # 86

ECONOMY Marek Misiak: With cautious optimism

CULTURAL MONITOR

# 66

To comprehend the past and look forward

OPINION

Cultural Monitor Daniel Lewczuk: Polish managers abroad

# 68

Andrzej Arendarski, PhD: Bureaucracy – calculate and eliminate # 72

INVEST IN POLAND

# 73

# 92

EVENTS Prospects for agricultural and food exports Personalities of the Year 2010 The 5th Europe-Ukraine Forum

#93

# 94 # 96

# 74

Polish EU Presidency

# 75

Publisher: Oﬁcyna Wydawnicza RYNEK POLSKI Sp. z o.o. (RYNEK POLSKI Publishers Co. Ltd.) President: Krystyna Woźniak-Trzosek Vice-Presidents: Błażej Grabowski, Grażyna Jaskuła Address: ul. Elektoralna 13, 00-137 Warsaw, Poland Phone (+48 22) 620 31 42, 652 95 77 Fax (+48 22) 620 31 37 E-mail: info@polishmarket.com.pl Editor-in-Chief: Rita Schultz rita.schultz@polishmarket.com.pl Editorial board: Jerzy Bojanowicz, Janusz Korzeń, Maciej Proliński, Jan Sosna, Janusz Turakiewicz, Sandra Wierzbicka, Małgorzata Wyderka

polish market :: 3/2011

# 88

A deep and permanent imprint…

Prof. Małgorzata Zaleska: Financial supervision after three years # 71

Ewa Małyszko: Health resorts need a few adjustments

# 87

Waldemar Dąbrowski, Director-in-Chief of the Polish National Opera in Warsaw: The Warsaw Opera House: a must on your itinerary # 90

Katarzyna Niezgoda: Cross-cultural diﬀerences in management # 70

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English Editor: Sylwia Wesołowska-Betkier

Cover photo by: Łukasz Giersz

Translators: Maciej Bańkowski, Konrad Gocman, Marek Gogolewski, Elżbieta Krajewska, Sylwia Wesołowska-Betkier, Sandra Wierzbicka, Jolanta Wolska

Printing: Zakłady Graﬁczne TAURUS – Stanisław Roszkowski, www.drukarniataurus.pl

Photographers: Jan Balana, Łukasz Giersz

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Polish Market Online Editor-in-Chief: Wiktoria Grabowska Marketing: Phone (+48 22) 620 38 34, 654 95 77 Katarzyna Malinowska – Marketing Director k.malinowska@polishmarket.com.pl Natalia Suhoveeva natalia.s@polishmarket.com.pl Ewelina Surma e.surma@polishmarket.com.pl PR: Joanna Fijałkowska j_ﬁjalkowska@polishmarket.com.pl

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Published articles represent the authors’ personal views only. The Editor and Publisher disclaim any responsibility or liability for their contents. Unsolicited material will not be returned. The editors reserve the right to edit the material for length and content. The editors accept no responsibility whatsoever for the content of advertising material. Reproduction of any material from this magazine requires prior written permission from the Publisher.

Editorial

Since 1990, a boom has been observed in the development of higher education facilities. Suffice it to say that the number of university students has trebled almost up to 2 million and that the number of public and private universities increased up to 455 (probably the highest number in any European country). State expenditures for education went up significantly, too. According to the latest data released by the Central Statistical Office (GUS), 40% of those aged between 19 and 24 are university students. However, university quality standards did not go up likewise. In the Shanghai ranking of world universities, only two Polish academic schools are listed among the 500 best, and that only among the last one hundred. It is also a fact that the number of university graduates is growing up faster than that of jobs they might take. Willy-nilly more than 20% of them are forced to take on work below their qualifications. The situation has matured for change. By commission of the Minister of Science and Higher Education Barbara Kudrycka, the Ernst & Young consortium in tandem with the Gdańsk Institute for Market Economics drew up the ”Strategy for the Development of Higher Education in Poland up to 2020.” Th is document diagnoses the situation and presents a strategic programme to overcome the adverse state of affairs. In response, university rectors released their report on the situation. Following the confrontation of diverse reform concepts a number of bills were drafted in Parliament. The overall objective of the new legislation proposed is to give universities greater autonomy, adjust their curricula to market economy requirements and ultimately upgrade the educational standards of graduates. A big educational potential has been developed in Poland in recent years and consequently it has become a common belief that graduating from a university helps best to get a job and to make a professional career. Now, schools of higher learning are taking over the responsibility for their fortunes and the future of their graduates. That means that an educational market is emerging with universities competing to win entrants by offering better quality education as well as adjusting themselves to labour market needs and international standards. Getting interested in that market is worthwhile: in a few years time graduates holding Polish university degrees may be in high demand on Europe’s HR professionals market! Moreover, with demographic low on the horizon, and the imminent decline in the number of Polish entrants, universities will have to open themselves up more widely to taking in students from abroad as well as to setting up international R&D teams in the framework of widening international cooperation in all fields. Exactly that is the proper road to take.

“Life is not easy for any of us. But what of that? We must have perseverance and above all confidence in ourselves. We must believe that we are gifted for something and that this thing must be attained. And with time, everything will turn out well and that so when one expects it the least.” These were the words of Maria Skłodowska-Curie, Polish scientist, the two times Nobel Prize winner. The message she conveyed in these words is universal. There is indeed nothing more important for us, for the development of our companies and that of the country’s economy as a whole than confidence in our skills. It is perseverance, knowledge acquisition and ambitions that prop us up on the way to achieve goals. Th is particular edition of “Polish Market” is devoted primarily to science. We review major Polish scientific achievements and we hail the perseverance of scientists such as Professor Henryk Skarżyński portrayed on our hard cover this month. “I am stimulated by perseverance and the need to overcome obstacles, especially the barrier of impossibility which is such a common excuse in our country. It is not easy and everybody may feel pessimistic or discouraged. That is why, despite all doubts, it is important to look for even small successes in life to maintain mental balance,” he says. We feature Polish universities worth studying in. We present prominent scientists, awarded by our magazine with the Honorary Pearl awards. We also admit how far our universities still are from the best, because regretfully barriers still exist that check our development potential. Along with experts interviewed in this edition, we prod for action to beat the barriers and tap the development potential of our companies, regions and provinces. It is worth noting in this context that “more than 51% of all patents in Poland are granted for inventions submitted for protection by universities, research and development units and the Polish Academy of Sciences,” says Alicja Adamczak PhD, the president of the Polish Patent Office. That in particular underlines the urgent need for scienceto-industry technology transfer. Hence it is worth learning Professor Michał Kleiber’s advice that ”we need a faith in success; we have to believe that what Finland and a number of Asian countries have achieved could happen in Poland”. So, persevere and succeed! Rita Schultz Editor-in-Chief

Krystyna Woźniak–Trzosek President Rynek Polski Publishers Co. Ltd. 3/2011 :: polish market ::

Polish-Czech cooperation At a joint conference with Czech President Václav Klaus in Prague, the Polish head of state Bronisław Komorowski emphasized that the relations between the two countries were of close neighbours who “have been following for twenty years the same prudent path towards modernisation and integration with the Western world. Today, apart from the feeling that our destinies are intertwined, it is highly important that we share the same interests, both within the EU as well as in direct relations between our countries,” Komorowski said. The Polish President also noted that in the second half of 2011 Poland will take over the EU

presidency while the Czech Republic will chair the Visegrad Group (the Czech Republic, Poland, Slovakia and Hungary). In his address, Václav Klaus highlighted the signiﬁcance of Czech-Polish relations and spoke strongly in favour of their further expansion. He added that his talks with Bronisław Komorowski focused among others on interests which their countries share within the EU. “We ﬁrmly believe that we should jointly endorse our standpoints. Only that could strengthen our voice in the EU,” he said. The Czech President also voiced his satisfaction over the forthcoming summit of Central and East European heads of state in Warsaw. ::

Poland’s security President Komorowski met with the Presidium of the Senate National Defence Committee. The meeting, held at the Committee’s request, discussed the New Concept of NATO Strategy guidelines as an issue of priority importance for Poland’s security, the political and military determinants of Polish armed forces’ involvement in the NATO-led International Security Assistance Force (ISAF) in Afghanistan as well as Poland’s armed forces’ development plans. The importance was stressed of the fact that the New Concept of NATO strategy has taken account of Poland’s basic security

priorities, including that of collective defence under Article 5 of the Washington Treaty along with the relevant implementation mechanisms in the shape of eventuality plans, military exercises and manoeuvres. It was agreed that Poland’s strategy in Afghanistan should be pursued within the Allied strategy envisaging a gradual reduction of combat operations by the end of 2012 in favour of training-stabilisation tasks and that the pull-out of the Polish contingent from Afghanistan should be completed in 2014. ::

The President and the Union of Poles in Belarus President Bronisław Komorowski met with Angelika Orechwo, the acting head since 2010 of the Union of Poles in Belarus. The President was informed about the present situation in Belarus, and in particular about that of the Polish minority there. The Polish head-of-state expressed his solidarity with Poles living in Belarus and with representatives of the democratic opposition in that country. He declared his staunch support for the Union and endorsed the need for democratic transformations in Belarus. ::

The Chapter of the Order of White Eagle The Polish head of state Bronisław Komorowski nominated Władysław Bartoszewski, Aleksander Hall, Krzysztof Penderecki and Henryk Samsonowicz as members of the Chapter of the Order of White Eagle. They will join Professor Wiesław Chrzanowski, member of the Chapter since 2007. Professor Władysław Bartoszewski was already member of the Chapter up to 2007 and is resuming his seat there now. The President nominated the four members of the Chapter on February 25. The Chapter comprises the Order’s Grand Master and five members. On his election to the post of President, the head of state becomes ex officio the Knight of the Order, the Order’s Grand Master and chairman of its Chapter. The members of the Chapter are nominated by the Grand Master for five years from among the Knights of the Order. The Chapter elects from among its members the Chancellor of the Order and the Secretary of the Chapter. The Order of the White Eagle is Poland’s highest decoration awarded to both civilians and the military for their merits. ::

Poland – Ukraine On February 25 President Bronisław Komorowski received the Ukrainian Foreign Minister Kostyantyn Gryshchenko who visited Poland to attend the 3. Consultative Meeting of Polish and Ukrainian Foreign Ministers. The talks focused on key aspects of Polish-Ukrainian relations. The Polish head of state welcomed the ongoing highly dynamic development of bilateral relations on all levels.

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He appreciated Ukraine’s readiness to cooperate with Poland on matters concerned with commemorating Polish World War II victims massacred in Ostrovky and Ukrainians killed in Sahryn as well as in undertaking the exhumation of Poles shot in Bykovna. After its completion work is to be commenced to commemorate Polish victims listed on the Ukrainian Katyn List. ::

Nuclear energy

The opening of the National Science Centre Premier Donald Tusk attended the opening of the National Science Centre in Kraków. The new institution will distribute grants for basic research. ”Starting today is a new chapter of wise and intensive employment of funds in science,” the head of government said. He pointed out that the reform of science in Poland has been built on faith in scientists’ autonomy. “Science has a chance when the sphere of autonomy and freedom is being continuously expanded, when the straitjacket of supervision by central administration is released. It is highly important in science that funds should go to those most capable of putting them to the best possible use,” he explained. The government head said that in 2011 planned state expenditures for R&D in the National Science Centre and the National Centre for Research and Development (NCBR) amount altogether to PLN1billion. “That amount is to rise steadily. Consequently, in three years time each of the two institutions will be able to earmark PLN1 billion.” Donald Tusk added that the return on science-based investments will in the future be several times higher than outlays. “I strongly believe that for many long years no government has taken such a fraught-with-consequences decision by giving up its prerogatives and control of funds into the hands of people who, I am sure, will put them to the best use for the good of the country,” the Premier concluded. ::

The government has finally decided to develop nuclear energy in Poland. A major emphasis in regulations has been put on assuring safety in the country’s future nuclear power stations. Security and monitoring prerequisites have been speciﬁed as regards the location, design, construction, launch and exploitation of the plants as well as removal of nuclear facilities. The primacy has been unequivocally stressed of safety over all other aspects of nuclear power plants’ operations and that not only in selecting the appropriate technology but throughout the whole process of its implementation. Detailed guidelines have also been approved for commissioning the

execution of investments concerned with building nuclear power facilities that would ensure eﬃciency and eﬀectiveness of procedures. Account was taken of investors’ responsibilities for assuring safe execution of the investments. That applies among others to collecting personal data concerning persons and entities involved in the construction of the plants and of accessing such information (e.g. name and surname, place of birth, PESEL personal identity number, place of Polish citizens’ residence and the passport number and citizenship in case of foreigners) to appropriate state administration bodies and security services when requested. ::

Polish-Israeli cooperation Polish Prime Minister Donald Tusk and his Israeli counterpart Benjamin Netanyahu took part in a joint press conference after the Polish-Israeli intergovernmental consultations. The Prime Minister stressed that PolishIsraeli economic co-operation has achieved impressive growth in recent times. “It is very important for Poland that trade exchange between the two countries is well-balanced, and that the amounts we buy and sell are more or less equal,” Donald Tusk underlined. “I wish to express my great satisfaction that cooperation in the areas of high technologies and research & development as well as in

military and civil fields has reached a very high level. Poland and Israel are cooperating in the best possible manner.” Furthermore, Donald Tusk assured that Israel had every right to expect the international opinion, including the European Union, to offer full support where it guarantees the stability, security and peace in the region. In response, Premier Benjamin Netanyahu observed: “The fact that we speak the same language on important matters such as defence and cooperation of our services, carries special significance in the world where various threats are increasing.” ::

Poland-Norway on nuclear power Donald Tusk met in Oslo with Jens Stoltenberg, the head of the Norwegian government. Their discussions focused mainly on energy issues, including in particular the necessity to diversify gas supplies. One subject that cropped up during the talks was the construction of the Skanled gas pipeline and the north-south gas axis, which the Visegrad Group countries and the countries which cooperate with them would be interested to develop.

Details of the Polish-Norwegian cooperation are to be addressed during Jens Stoltenberg’s visit to Poland planned for June. Th e talks also concentrated on possibilities of exploiting shale gas in Poland, the necessity to reduce carbon dioxide emissions, and beneﬁts to be derived by Poland from the Financial Mechanism of the European Economic Area and from the Norwegian Financial Mechanism for the years 2009–2014. :: 3/2011 :: polish market ::

Our Guest

“Wise Poland” Principles of knowledge, excellence and enterprise-based society Prof. Michał Kleiber

President of the Polish Academy of Sciences (PAN)

A majority of Polish people – happy because Poland regained full independence 20 years ago and satisfied with many of our achievements over this period – have a feeling today that there are imminent threats to our further stable development and that the opportunity to catch up with the most developed countries, offered to us by history, is not being exploited effectively. Some attribute this situation to our inability to overcome the “demons” of the pre-transition period – we, as society, are supposedly still imprisoned in the mental fetters of “real socialism.” But the key reason behind our present-day fears and disappointments is something quite different. The reason is the absence of a convincing model of pro-development changes in the functioning of the state and – even more - the fact that many politicians do not see any need for creating such a model. We are not keeping pace with the changes taking place in today’s world. The dynamics of this process exposes ruthlessly the fact that we are not prepared to face the clearly visible

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challenges, although it is now, and in front of our very eyes, that Poland’s fate for the coming decades is being decided. What we need is faith in success. We have to believe that what Finland and a number of Asian countries have achieved could happen in Poland. Such a faith should be based on a reliable identification of opportunities and an honest “examination of conscience.” It should also be based on a bold and far-reaching vision attractive to those who will be pursuing it – that is all of us. While valuing the lessons learnt from the recent economic history of countries which have achieved spectacular success in development, we should be well aware of the scale of challenges we face – our development model has to be our own and autonomous because our special situation and development dynamics mean that we cannot follow strictly the solutions used in the past by others. Below I present 10 basic requirements that, in my view, have to underlie the country’s development strategy if we really want to successfully meet the challenges of the contemporary world and create a realistic vision for the accelerated development of Poland. In other words, it is a Decalogue of measures for a modern Poland – measures that are feasible but defi nitely require changing the way in which we think about our future. 1. Efficient and sagacious government, meaning the legal framework that is effective and not overregulated, combined with modern infrastructure and strict fiscal discipline; 2. Scope of public debate and the manner in which it is conducted, meaning the need for critical reflection on the dominant cultural model, and possible ways of winning support for modernisation policy and the just division of its costs; 3. Supra-sectoral, anticipatory development strategy, meaning the need for a wise leadership; 4. Education, independence, creativity, the ability to work together and mutual trust,

meaning the need to build human and social capital as the key investment in development; 5. Scientific research as an inalienable element of social development, with noninvestment in research understood as investment in ignorance; 6. Putting innovation into practice, meaning the need to identify indispensable measures and harmful stereotypes; 7. Technological priorities and niches, meaning the need for an industrial policy; 8. Open innovation models as a sign of a wellthought-out foreign policy: looking into reflection on the requirements of globalisation; 9. Culture as a generator of social openness and creativity; development of information society and support for non-governmental civic initiatives: indispensable “supplementary assets” of an innovative economy; 10. Courage to dream and consistence in making dreams come true - strong faith makes miracles happen. Is there a common denominator for the above demands? Yes, there is. It is the conviction that the term “knowledge, excellence and enterprise-based society” is not just a slogan, as many pessimists would like it to see, but a truly realistic goal. The term denotes a society where the dominant conviction is that knowledge and the ability to use it in practice is the basic factor behind the progress of mankind and a guarantor of stable economic growth. Resources of knowledge are vast. We have to learn how to best identify, acquire, store, process, popularise and protect them. In many cases, the use of existing knowledge may make miracles happen – many Asian countries have based their enviable development on the skilful use of such knowledge. But the most valuable thing is new knowledge, one developed in a well-organised process of research and development work of different kind, using past experience, observing development trends and following, wherever possible, the documented success paths of others. In the long run, we have no choice but to base our development on effectively use of existing knowledge, creative development of new knowledge and support for every form of enterprise. A programme offering the best chance of achieving the success we are dreaming of depends on strengthening our faith in the power of knowledge and enterprise, and promoting individual and collective creativity. In other words, “Wise Poland” is a programme which offers us a great chance and is needed right now. It is realistic only if carried out as a joint national undertaking. ::

Warsaw University of Life Sciences – SGGW

• • • • • • • • • • • • •

Student-friendly university 28 fields of studies 130 majors Full-time studies Evening studies Extramural studies Post-graduate and doctoral studies Studies and training abroad Experienced lecturers Modern laboratories and workshops Well furnished dorms Super sports facilities Scholarships and financial aid

CONTACT: Warsaw University of Life Sciences – SGGW Nowoursynowska 166, 02-787 Warszawa http://www.sggw.pl Student Affairs Office Tel. (+48 22) 593 10 25, Fax (+48 22) 593 10 39 e-mail: bss@sggw.pl International Relations Office Tel. (+48 22) 593 10 40 (52), Fax (+48 22) 593 10 42 (48) e-mail: iro@sggw.pl http://www.iro.sggw.pl

The most innovative and creative University in Poland

Our Guest

Expenditure is not the only thing that matters Interview with Prof. Krzysztof J. Kurzydłowski, Director of the National Centre for Research and Development (NCBiR)

will submit such applications. The condition for this will be own contribution or contribution in kind – I cannot ﬁ nance any entrepreneur’s research in 100%. Th is is according to the regulations, as well as common sense.

Professor, there are many great scientists, managers and businessmen. This fact is confirmed by the examples of spectacular careers – mainly abroad. In our country, we have always had the problem of transition from the concept to the industrial phase, something which has become our national obstacle on the road to innovation. Is the National Centre for Research and Development going to be a platform for cooperation of public administration, science and business, sparking an explosion of innovations? In my opinion, if you leave out the phrase “explosion,” then we have a chance to achieve this goal. The legislative package which is to establish and manage NCBiR is supposed to significantly change the procedure for creating a R&D policy. Until now, generally speaking, it was the Minister of Science and Higher Education who decided about expenditure and its distribution for research which was to bring specific economic and social effects. Today, the role of creating research policy on strategic level, regarded as decisive for the future development of the country, has been ceded onto the NCBiR Council, composed of prominent scientists and representatives of ministries and business. It is the Council, that decides on the strategic directions of research, which are later approved by the Minister, and implemented by the Director of NCBiR. We are aware of the fact that the responsibilities and challenges related to the implementation of public R&D programmes in Poland are a field that is not spectacular, easy or appreciated. It may be that the “years of hunger” in Polish science resulted in the fact that this community got used to thinking that it is more difficult to get money than to spend it. However, the reality is different now, especially considering that we are slowly entering onto a higher level of expenditure.

The institutions distributing public funds for the support of innovation boast about the amounts they’ve already managed to spend. It’s difficult, however, to obtain much information about the effects of these expenditures. Is there a chance that under your command, the NCBiR will provide such information? The current situation may partially be a result of the regulations obliging these institutions to provide information on spending public funds. There are, of course, some limitations, especially in the areas of security and defence, so that some proponents will wish to protect parts of their applications containing trade secrets. However, I will make it my policy to make available all information which will not be eligible for rational restriction. We will reveal the results of the research as we fi nalise them. The results, not only the expenditure. I am one of those who stress the irrationality of focussing on expenditure. In the Lisbon Programme, there is no pressure on the results, but on the necessity of spending 3% of GDP in the R&D area. And we all know that similar expenditures in different countries can lead to different consequences – for example in Poland these may be bigger than in Western Europe, due to lower labour costs, also in the research area. To sum up – it’s clear to me that the goal here is not expenditure. In order to justify existing practice, I can remind you of really objective problems with the evaluation of the results of research, when they result for example in medical services getting cheaper or safety being improved. I personally intend to assess these results with the use of financial means from entrepreneurs. Th is will convince me better than any declarations on the ways of using research results and effects to be obtained this way. I have confidence in business entities in Poland, and, if during my 4-year term they increase the amount of money spent on R&D, it will be the best indication of my mission being accomplished. ::

On taking the oﬃce of Director of the NCBiR, you declared that the priority will be the needs of the business community

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and the sector of the real commercial economy. Does it mean that the strategic priorities pursued until recently will become less important? Not at all. The strategic programmes will be realised. What’s more, they can satisfy the needs of entrepreneurs as well. Creating these programmes is within the competence of the NCBiR Council, where the business field is represented. The Centre, however, deals with a significantly wider range of activity than strategic programmes. And in this area of projects, fi lling the gap after the target and development programmes that used to be run out by the Ministry of Science, which is the supplement to strategic programmes, we would like to finance research of equal economic and social importance. I don’t need to assume in this area, that these will be the projects that refer to strategic subjects – I want to concentrate on fi nancing projects supported by entrepreneurs. In a very practical way on which they will spend their money too. Does it mean you’re paving a new way for projects? I have to, according to the legislation. In the past, the Centre realised strategic programmes and the Ministry invited tenders for other programmes. Now everything moves to NCBiR - that’s why our budget increased from PLN600 million to PLN1 billion. Th is whole area of projects (except from those realised within the framework of the Operational Programme - Innovative Economy with European fi nancial resources), both development and target projects, is being transferred to us along with the fi nancial resources. We’ll soon open tenders for projects, which are the continuation of the existing target and development projects, while the NCBiR will organise their assessment and fi nancing. Using these entitlements, I plan that in two-three months, the programme for innovative enterprises will be launched. I expect that enterprises which are able to implement innovation, and have an idea for it,

Our Guest

Poland deserves a “Harvard” of its own Interview with Prof. Barbara Kudrycka, Minister of Science and Higher Education

For several years now we have seen continuing work on documents concerning the reform of the research and higher education sector. Could you describe the keystones of these reforms? Autonomy, quality, and opening up to the world is a success formula for Polish universities included in our reforms. We propose in our amendments that a given university’s quality of research and teaching should be more important than its size. Th is will be possible primarily thanks to the modern, pro-quality method of fi nancing universities by the state. The best faculties, the most outstanding scientists and scholars, and the most excelling students, will receive greater support. We will pick the Leading National Research Centres that will have the strongest intellectual, research, and infrastructural capital. They will not just attract the best scientists and students from Poland, but they will also be entering the European market and will become attractive to foreign partners. It is essential that we are also moving away from programme standardisation and a rigid ministerial list of majors, so that universities look for their own specialities, observing the needs of local labour markets, and the capabilities of their own outstanding researchers. Thus we are extending the curriculum autonomy of universities. Importantly, the reforms will engage entrepreneurs in the process of creating study curricula, and even in conducting classes and organising training for students. Many such steps have already been taken by universities themselves, as they are investing in their own infrastructure and teaching staff, showing perfect understanding of the challenges of contemporary civilisation and labour market. We would like to help them in this by providing better instruments. An important field of change is also the question of opening up to international partners, foreign students, and eminent researchers, who, it is my fi rm belief, will more frequently choose Polish universities as places for further education and research. Bold competition, high aspirations, and the readiness to work hard are the most important conditions for improving quality. The reform provides the opportunity for ambitious universities, scientists, scholars, and students to work towards joint success. Poland really deserves a “Harvard” of its own. Polish universities are facing the opportunity to gain a stronger position on the international education and

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Our Guest

research markets. Are they taking good advantage of it? Everything depends on their choice, as the reform offers alternatives in many fields– if you want to develop and compete in terms of your level – you will take advantage of the new potential. We already have universities proving that good management strategy, a high level of teaching, and student-friendliness can win you a high position in the rankings, and not only the national ones. Such universities welcome our amendments with open arms, and many of them are already applying these changes, without waiting for new regulations. Thanks to the prepared amendment, from next year universities will be able to more flexibly respond to the changing needs of students and the labour market and also to European and global trends. As a result of the reform we will further inscribe our higher education into the world of European education. We are currently preparing universities to introduce a new system of education based on the National Qualifications Framework, which are the rules congruent with the European Union model of education. In this way, it will be possible to compare the qualifications of Polish graduates with their colleagues from other European countries – Polish universities will be able to freely and autonomously establish study curricula and shape their educational package – extending the range of their interdisciplinary studies, cross-faculty studies, and studies with a faculty-less structure. If a given university gives priority to quality and a rich and attractive range of studies, it will gain even greater opportunities for growth, attracting outstanding students, and obtaining grants for research and teaching, thus achieving a higher position, also in terms of European competition. A lot is said about the fact that the hard work of Polish scientists only too rarely results in achieving market success. How can this be changed? The now implemented reform of science and the already-prepared reform of higher education are actions intended to help change this unfavourable trend and more effectively take advantage of the enormous potential of our science. We bet on decentralising the process of fi nancing research. After all it is the scientists, and not politicians, who know best which projects have the greatest potential

of achieving success on the global scale. Only fi nancing large investments such as national research centres, and, for some time, the allocation of structural funds, will remain in the hands of the Ministry. In the light of the reforms of science, decisions on the allocation of public funds to research institutes and projects will be taken by independent agencies - The National Centre For Science as an external agency distributing funds for fundamental research, and the National Centre For Research and Development that will distribute funds for applied research. Projects will be evaluated by eminent scientists, entrepreneurs and practitioners. The aim of this is for the procedures to guarantee not only openness and transparency, but also qualified people with experience in the field of implementation to decide on the fi nancing of projects with the highest innovation potential. I am counting on the participation of foreign experts in this process. I also believe that the current investment boom in the research infrastructure, and we are allocating over EUR4 billion in this area, will help create the proper conditions for our scientists and scholars to work towards measurable success. Still, the scale of this success primarily depends on the scientists and scholars, universities, and research units themselves, in both economic and innovation terms. Providing intellectual potential for business and tackling contemporary challenges becomes a new role of the academic community. The low share of private capital is a problem in the fi nancing of R&D. Venture capital funds are still “cutting their teeth,” and many scientists have no idea of how great the commercial potential of their own knowledge is. The participation of entrepreneurs in expenditure on research has remained at 35-40% in the last 10 years. In comparison, in Germany 75% of expenditure on R&D is borne by private entrepreneurs. I am convinced that we have the ability to change this negative percentage and open our science to the economy to a much greater extent. As shown by research conducted by the ministry, as many as one in five of Polish entrepreneurs does not realise the opportunities to cooperate with R&D centres and 40% of business representatives do not know how to reach research centres interested in commercialisation. I hope that the new system of science in Poland will help eliminate this barriers and bridge the gap between science

and the economy, which is the only way to greater innovativeness. We are celebrating the Year of Maria Skłodowska-Curie. What should be the meaning of these celebrations to Polish science? The Year of Skłodowska-Curie is not only an occasion to bring back the memory of our great scientist, who, even today, can be considered an example to follow for young adepts of science, but also a time of reflection on the conditions for the development of science. The Polish Nobel Prize winner proved that nothing is impossible in science. She proved that what counts is intellect, passion, and perseverance in pursuing your own goals. The Year of Maria Skłodowska-Curie is an important opportunity to promote Polish science. It is our intention for the celebrations to fit the important message we want to share during our Presidency of the EU Council. They will introduce a broader context to it. We want to remind Europe of the contribution our scientists have made to the development of world science, and, most importantly, clearly state our intention to actively participate in the development of 21st century science. Our system reforms are the fi rst vital step. We would also like to show Europe that the investments in Polish science made over the last several years have made it an attractive place for conducting scientific research. On 1 July 2011 Poland will take over the Presidency of the EU Council. What are the key areas of focus for the ministry? These will be such topics as implementing the European Research Area, the 8th Framework Programme of the EU in the field of research and technological development, the EURATOM Framework Programme, the modernisation of the universities, and the mobility of scientists, scholars, and students. During the Polish Presidency, the ministry will host important meetings, such as the informal meeting of the Council of the European Union on Competitiveness and meetings of the Research Working Group, the European Research Area Committee (ERAC), and the Education Committee, as well as a meeting of Directors-General for Higher Education and the Bologna Follow-up Group. Our ambition is to put emphasis on the importance of intellectual capital for economic development. Interview: Maciek Proliński 3/2011 :: polish market ::

Our Guest

Indispensable knowledge Interview with Alicja Adamczak, PhD, President of the Polish Patent Oﬃce

What is the role of the Polish Patent Office in the broadly-understood research process? The mission of the Polish Patent Office includes making patent information resources available to researchers in the form of patent descriptions on paper and in electronic form. Scientists conducting research projects should use knowledge about the inventions and utility models entered into the databases of the Patent Office. Th is knowledge is indispensable for them to be able to properly plan their research work which is supposed to lead to the development of new technological solutions. The knowledge helps them to avoid working on solutions that have already been developed and contributes to ensuring that the achieved results are of high quality. The Patent Office also conducts a large-scale information campaign targeted at the Polish scientific staff about the principles of intellectual property protection. Knowing these principles, scientists can conduct the research process in such a way so as to be able to achieve a result which may be patented. Inventions are linked with innovation. How does Poland compare with other countries in this respect? Do the standards and areas of research conducted in Poland make our economy highly innovative? In 2010 a total of 3,142 new patents were entered into the registers of the Polish Patent Office while 3,387 inventions were submitted for patent protection. These numbers show that, although Poland has a large potential for innovation, it does not use it to the full. In western countries, which have highly developed economies, the number of new technological solutions which receive patent protection is many times higher. Poland is in 25th place in the world in terms of the number of patent applications and 19th in terms of the number of patents granted but if these rankings are compared with the size of the country’s population it is evident that we still have a lot to do. Polish researchers have very innovative solutions to their credit, for example those associated with medicine. They have

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developed a spectral CT scanner for the accurate and swift examination of changes in the retina, Polish spine implants have gained worldwide fame and the most modern robot for cardiac surgeries has also been developed in Poland. Polish researchers have developed a sensational medical material, an “artificial bone”, which can be used to replace missing bone, as well as a number of inventions associated with cancer treatment. What is the share of Polish universities and scientific institutes in the patenting process? More than 51% of all patents in Poland are granted for inventions submitted for protection by universities, research and development units and the Polish Academy of Sciences. The number of inventions submitted by Polish research and development institutions is much higher than the number submitted by the business sector – the share of the latter slightly exceeds 23%. The remaining part are patents granted to private individuals. Operational programmes, like for example the Innovative Economy and Human Capital, partially funded by the European Union have been carried out in Poland for several years now. How do they contribute to stimulating Polish science and research? The programmes enable many constructive initiatives which support the development of innovation and make the Polish economy more competitive. But they cannot substitute for systemic measures at the state policy level. The operational programmes can significantly stimulate the development of various research areas on condition that they are an integral part of a strategy for the development of our country. Acquiring EU funding is only half of success – it is very important to ensure that the money is spend in such a way so as to increase the number of innovative Polish solutions conducive to the development of our economy. It is also worth pointing to initiatives benefiting universities and other scientific institutions fi nanced from the national budget, especially programmes carried out

More than 51% of all patents in Poland are granted for inventions submitted for protection by universities, research and development units and the Polish Academy of Sciences

by the Ministry of Science and Higher Education. I mean the PatentPlus and Creator of Innovation programmes, under which scientiﬁc units may receive funding for various undertakings associated with the protection of intellectual property, including funding for patent applications abroad, training courses on patent protection and undertakings aimed at establishing contacts with business in order to transfer technological solutions developed at universities to the marketplace. Additionally, it is worth noting that the ministry has included problems related to intellectual property protection into the parametric appraisal of scientiﬁc units and degree programme curricula at universities. Th is will certainly contribute to raising the awareness of the research community and the general public in this respect. :: Interview: Maciek Proliński

Our Guest

Innovative Poland Bożena Lublińska-Kasprzak Today, innovation is a keyword used to defi ne many essential activities, on both individual and business entity levels, and also in relation to larger political, social and economic systems (countries, country unions). The reason for this is that it is a broad concept which encompasses many meanings. For example, it can be described as pertaining to the innovative business activity of companies within the area of creating products and processes, and, defi ned in this way, innovation is an economic category. One can, however, look at this issue from a broader perspective, in the context of socio-cultural development, which already expands the scope of players influencing the level of innovation. It is no longer reserved for companies only, but also public institutions, voluntary social organisations or private persons. Th is multitude of meanings is justified, however. If we look into the innovation rankings of individual economies (i.e. based on the Innovation Union Scoreboard), it is easy to notice that the innovation leaders also include the countries with the highest GDP per head. Poland, for this matter, ranks 21st among the 27 EU states. We are in the third (of four specified) group of moderate innovators, and, let me point out here, that in 2008, we were in the last group of so-called modest innovators. According to the latest report by the Polish Agency for Enterprise Development, the latest data from the years 20062008 reveal that one in five companies in industry and 16% of enterprises operating in the services sector are innovative. When we compare this data with innovation leaders like Germany, where 3 in 4 companies are innovative, or Finland, Denmark and Sweden, where one in two enterprises run an innovative business, we can see why we rank lower in the innovation rankings. It is worth emphasising, however, that the number and position of the systematic innovators

President of the Polish Agency for Enterprise Development

– the companies that do not limit themselves to one innovation only in Poland is growing, and, importantly, companies’ expenditure on innovation is growing, too. Between 2006 and 2008, this expenditure grew by as much as 44%. The sales value of new or improved products and expenditure for R&D increased as well.

What needs to be done to raise the level of innovation in our country? There is a more and more prevalent notion that in our social and cultural circumstances (limitations), assigning a large part of (state) fi nancial resources for innovative actions does not constitute a sufficient stimulus accelerating the “stream of innovation” in enterprises. In order to achieve this, an enormous mobilisation is needed, as well as focussing by different entities on what seems to be the root of the problem – limited willingness to cooperate between

the individual players in the innovation process (entrepreneurs, business-related institutions, science), not being aware of the obvious fact that “innovation pays oﬀ ” and the instant rejection of one’s own innovative activity, stereotypically associated with the processes that require support from the advanced, and thus expensive, technologies. The Polish Agency for Enterprise Development, by supporting various forms (and on various levels of ﬁ nancing) of the innovative activities of companies looks for entrepreneurs who really take up advanced projects related to R&D, but also successfully supports the companies which, with a relatively low level of support, initiate innovation processes in their own organisation. Th is shows that money is one of the conditions for running innovative business activities, but in order for these activities to emerge, it has to be preceded by the will, knowledge and ideas of those who initiate the innovation. :: 3/2011 :: polish market ::

Science and Innovation

Challenges, knowledge, consistency, success Professor Henryk Skarżyński, the creator and founder of the International Centre of Hearing and Speech in Kajetany, outside Warsaw, and the organiser of the World Centre of Hearing, talks to Rita Schultz.

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You have taken on an enormous challenge – not only to set up the best centre for hearing and speech therapy, but also to struggle for development, reputation and creation of a world centre. Does the fact that you have given up the role of a doctor and adopted a role of a businessman, and in a sense a politician, discourage you? In all my activities, my role as a doctor was, is and will always be the most important. It constitutes the basis for all my scientific, clinical, didactic and organisational goals. My inner compliance to this explicit attitude is the source of my satisfaction, a sense of being fulfi lled and – as some say – the external rewards for what I have achieved in the activity areas I have mentioned above. I am a dreamer who sometimes cherishes the dreams for a long time just to test them against everyday reality and the real situation in the country and abroad. I believe that you can achieve a lot if you are a persistent dreamer. In the beginning, dreams seem to be beyond the real world and burdened by various threats. When you start to plan how to make them come true and take very decisive steps, you need to apply your skills and efforts, and you should be very consistent. Once you regard your work as a passion, you are able to go through the less glamorous stages and gradually begin to feel satisfied with what you do. In this apparently complicated reasoning of mine, I should say persistence is essential. Th is means neither blind compliance with somebody or something nor contradictive action, but completion of what is planned. I could mention dozens of events or activities from my professional life which gave rise to highly successful scientific, therapeutic, didactic and organisational solutions. I call them “milestones”, and they are indeed significant achievements of Polish science and medicine as far as they affect in many ways the fate of thousands of people every year. To answer your question literally, I will put it this way: If you are very much involved in what you do, and choose people and tools that are available to everyone, there is no room for discouragement. The fi rst operation I performed in Poland to restore the world of sounds for a deaf patient 19 years ago made me realise the large

Science and Innovation scale of problems related to hearing, voice, speech and balance disorders. I reckoned that the media event that followed this operation was not the end, but actually the beginning of the great challenge. I understood that no man alone can provide the patients with long-term care and that there must be a team of various specialists to meet these challenges. The international medicine of that time did not provide any ready patterns, but fate gave me a chance to observe various unique solutions in Europe, America and Australia. I did not copy anything as it would have been impossible, especially in Poland at that time. By choosing methods that have already proved successful once or twice, I did not meant to reinvent the wheel, but to add my idea of what could be done for another man. Th is was how the fi rst element of my comprehensive programme, the “Cochlear Centre”, the Diagnostic, Therapeutic and Rehabil itation Centre for the Deaf and Hard of Hearing appeared in 1993. In 1996, based on my project and my scientific, clinical, didactic and organisational achievements, the Institute of Physiology and Pathology of Hearing was established. In 2003, I set up a unique “International Centre of Hearing and Speech”, a centre which has no counterpart in the world. Th is year, during the Polish presidency of the European Union, we will open the World Centre of Hearing. World? Why not given that within the last eight years we have performed the biggest number of hearing-improving operations in the world. It is here that the world’s fi rst surgeries for partial deafness on adult patients, and then on children, were performed. I also devised a new electrode for the latest cochlear implant system. It was here that the bilateral cochlear implantation into the brainstem was performed for the fi rst time in the world. The patient - a musician - made another two CDs after the operation. Last year in Washington, we won the 21st century Healthcare Award for the world’s fi rst remote system of postoperative care of patients. These are only a few of our major notable achievements of the recent years. That is why using the term “world” is fully justified, and it will soon be realised as the construction

of the World Centre of Hearing is only the beginning of a whole range of European and global activities which will be undertaken in Kajetany near Warsaw. While doing my job I feel a fullfledged doctor, clinician and a man of science, and perhaps a businessmanpolitician in science. What stimulates you to continue work and sometimes tilt at windmills? Don’t you feel discouraged? I am stimulated by perseverance and the need to overcome obstacles, especially the barrier of impossibility which is such a common excuse in our country. It is not easy and everybody may feel pessimistic or discouraged. That is why, despite all doubts, it is important to look for even small successes in life to maintain mental balance. There are days when I do over 20 ear microsurgery operations. If they are successful and their efficiency exceeds 95%, I am overjoyed at the end of the day. They compensate for temporary failures and allow me to deeply and truly believe that I am right and achieve what I have intended to – sometimes perhaps at a slower rate. My job and my passion for work give me a lot of positive energy. I am painfully demanding of myself and, unfortunately, of many others. Otherwise, there would be no effects so impressive for the numerous visitors: distinguished guests from abroad, politicians, scholars, and practitioners of various medical specialties. I do not brood over tilting at the windmills in my way, but rather look for positive contact with good people who are worth devotion and with whom the grand visions may be implemented. What is your most remarkable success? The fact the I am healthy and strong enough to do such arduous but exciting work is success in itself. I am lucky to have a normal situation at home and support from my closest, tolerant family, for whom I do not have too much time. The rest is up to me. I must divide my achievements into different areas of my activity which complement each other. In the realm of science, the greatest achievement was undoubtedly when I realised that artificial hearing of the medium and high frequency band can be added to hearing that is partially

preserved at normal levels in the low frequency ranges. Th is enables a person who earlier understood only a few percent of another person’s speech understand it in 100%. In a clinical sense, the most important thing was the application of this programme in daily practice and the excellent results obtained, both immediately after surgery and after over eight years. We are still the only centre worldwide with such results of treatment of partial deafness in children. In both the scientiﬁc and clinical areas, it is essential to develop and implement a telemedicine network in the

ﬁ rst country in the world to serve patients with auditory implants, which would give them a great sense of security and the possibility of getting immediate help from various experts. In terms of teaching, my accomplishment was to organise a live demonstration of operations carried out in Kajetany for more than 2,000 surgeons from all over the world. It was an enormous challenge and a huge responsibility, but also a unique opportunity to demonstrate the world’s best experts in this area what we are able to do. During their visit to the International 3/2011 :: polish market ::

Science and Innovation Centre of Hearing and Speech they could see that all we have described in our publications or present at congresses worldwide, and all we have done as the fi rst centre in the world, was possible and bore fruit. Th is was complemented by my operations carried out in Hanover, St. Petersburg, Minsk, Kiev, Beijing, Manila and practical courses taught in Bogota, Parma and Mechelen. The scope of my organisational action, which is a consequence of all previous achievements, included assembling of a team of people from various fields of medicine, bioengineering, psychology, education, physics, and acoustics. Then, there was a plan and consistent construction of facilities and equipment, where our own team contribution ranged from 30% to 80% of the total budget of these undertakings, including the World Centre of Hearing. In comparison with these, such activities as the programme of comprehensive examination of hearing in newborns and infants, which was launched in 1995 and ended with tremendous success in 1998, or the recent widespread screening programme for early detection of defects in hearing, speech and vision do not seem to be so outstanding. For our new inventions, new devices, and new solutions developed during their implementation, we received over 50 awards, commendations and gold medals at major exhibitions of innovation and technological progress in Brussels, Paris, Geneva, Nuremberg, Seoul, Kuala Lumpur, Stockholm, Washington and other places around the world. Is it difficult to fulfi l all the roles I have mentioned before? I adopt many roles in my scientific and professional activities. I serve as the National Consultant in Audiology and Phoniatrics and as the Chairman of the Scientific Society and the Committee of Clinical Pathophysiology at the Polish Academy of Sciences, in addition to my commitments as a member of editorial boards of several foreign journals and in international organisations. In 2009 I was – and this year I am again – the host of major world congresses in Europe. It is not easy to combine all the duties. Accomplishment of these tasks is possible thanks to collaboration with the young and

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very ambitious team. The basic thing is to have a clear-cut hierarchy of priorities. Doctor’s duties come fi rst: if I decide to operate on someone or diagnose and treat the patient, this is the most important issue. My everyday clinical work gave rise to my dreams and ideas what to do and how to develop all that surrounds me. There must be certain harmony in all we do. Without it, there is chaos and reckless actions. Having this in mind, I manage to combine the different roles of mine. Your activity reaches not only beyond the Polish borders, but also beyond the EU; you support and teach; recently you have received a medal from the First Lady of Georgia Sandra Roelofs Saakashvili. Through your actions you promote Poland and Polish science; does it help you work with the Polish administration? In the late eighties and early nineties, I was in Paris, where I got a very warm welcome. I brought back plenty of knowledge and ideas, and tried to put them into practice in our complex but interesting reality. My activity in the east of Europe – the growing scientific and organisational contacts with Russia, Ukraine, Belarus,

Georgia, Azerbaijan, Kazakhstan, and Uzbekistan – stems from the need to share our experience, which, as I see now, is part of a European Union initiative, the so-called Eastern Partnership. Th is means sharing my expertise with people and, in a sense, repaying my debt incurred from the French colleagues. These actions arise from my inner need to promote Polish medicine and science. No one has obliged me to do so. I was deeply moved when I learned last year that, for the first time in history, the Minister of Foreign Affairs honoured a doctor of medicine Henryk Skarżyński. Do my actions help me to cooperate with the Polish administration? I try to not rely on this and do my best to perform the duties of the Director of the Institute or the National Consultant. I would like my person to be assessed on these grounds. I see interest in my external activities in the scope of health and economy, which suggests that these departments are aware of the necessity and effects of our activity. I can assure you that our actions in the east will be intensified because they are indispensable, and because they contribute to the overall image of our country abroad. As for the awards, I received them also from the President of Ukraine and the King of Belgium. What is crucial is that we manage to leave a lasting imprint in various places on Earth. Your activity is well-known and appreciated beyond the borders of our country. Do you see opportunities to build more such centres as that in Kajetany? Yes, I see the possibility of publicising many of our scientific, medical and organisational programmes. Apart from the branch network consisting of more than a dozen centres and cooperation centres in the country, we provide assistance to the establishment of the Black Sea Centre of Hearing and Speech in Odessa; we offered consultations and attempt to set up a similar centre in Moscow; we are involved in discussion about this issue in other countries with teams that are in the same place as we were several years ago; we have received an invitation to cooperate with India. There is a chance to promote good Polish patterns in different parts of the world.

Science and Innovation What do you think is the reason for the lack of appreciation of our scientists and their achievements and ideas at home while the ideas are immediately adopted outside Poland? What do you think needs to be changed for young people to get education in more complex faculties which require advanced technical and medical knowledge? These questions are difficult and it is not easy to give a simple answer. Generally speaking, we have a strong aversion to success in all areas of life. We are envious, and if we cannot stop something, we ignore it. Career, in the good sense of this word, and success are not regarded as a standard, benchmark or incentive to pursue what is good. Th is, in turn, does not contribute to dissemination of good practice and to the choice of the good way. From this perspective, we underestimate not only scientists, but also other talented, enterprising and active people. Scientists themselves do not always appreciate each other, even when they know what effort various achievements take. In other countries, there is no such an aversion: success is shown; it ennobles and immediately fi nds followers. That is why they go ahead, while we are stuck in one place. Yet, a lot has changed in recent years and I believe that the young generation will uphold this trend. They do not regard themselves as worse. We have among us many very talented people that need help. I have always backed the young up and it was worth it. We do need examples in order to change ourselves positively, examples that are supposed to show that one can and must do something important and great, not only in the country. We should require and appreciate human work. We must prove that we can afford “the wise Poland” - as the President of the Polish Academy of Sciences, Professor Michał Kleiber said. We can do it. Maybe someone will fi nd positive inspiration in this interview. Perhaps he or she will understand that we started preparing for the Polish presidency four years ago when we organised a series of lectures and an exhibition at the European Parliament on our own initiative. On the basis of our experience, we discussed the importance of equal opportunities for the young generation of Europeans. We claimed that hearing was fundamental

to communication in the modern, developing information society. Many of our programmes were launched long ago, and we will be gradually unfolding the next ones in the coming months and years. Today, we need legal regulations to be ensured by the government in order to facilitate our development; we must also present prospects for the next 10, 20 and 30 years. These may be varied or slightly modiﬁed, nonetheless they must

exist to show the best individuals that it is worth staying, living and working here. Not coincidentally, last year we were the ﬁ rst country in Europe to be entrusted by Americans with the implementation of the latest rhinosurgical equipment. They were sure that we would not squander the opportunity, but do it well and produce good therapeutic eﬀects. So a lot can be done as shown in our everyday work. :: Photo: Łukasz Giersz

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Science and Innovation

Good prospects for Polish pharmaceutical industry “Despite a visible economic slowdown, Poland’s pharmaceutical sector is in good shape,” say Marcin Rudnicki, head of the pharmaceutical team at KPMG and Karol Kołt, chief executive at PMR, basing on a report prepared by both companies.

This material is an excerpt from a Polish Pharmaceutical Market report compiled by KPMG and PMR.

In 2008 the value of the Polish pharmaceutical market reached PLN 24.1 billion, an 11.5% rise on 2007. Today it is among the most promising segments of the national economy. In 2009-2011 the compound annual growth rate (CAGR) for the pharmaceutical sector will come to 7.4% by our forecasts and about 6% according to the surveyed ﬁ rms. The Polish pharmaceutical market is the sixth-largest in the EU and in 2007-2008 its sales growth (in EUR) was the second-fastest in the community. Almost one-third of the surveyed companies named new medications as the driving-force of their and the sector’s growth. Other mentioned growth factors included the general rise in buying power in Poland and refund medications. Asked about medications expected to appear in Poland in the next two years, almost 50% named cancer treatment drugs. 40% of the

surveyed fi rms said they planned to introduce 3-10 new medications by the end of 2009, only less than one in three planned no new products. The economic slump did not hamper investment in the pharmaceutical sector. On the contrary, over 60% of those surveyed planned to raise staff development funding over the next 12 months, a similar percentage intended to raise production infrastructure spending. Slightly more firms declared no change in R&D outlays than raised research spending, but at over 40% the percentage of those who planned more investment in R&D was still high. Over the next 12 months online and direct trade will be among the fastest-growing medication sales channels outside traditional pharmacies. According to those surveyed the fastest-growing channel will be online pharmacies, as many as 80% of them

claiming online pharmacies will grow faster than the entire market (over 50% said the same about other online channels). Th is means companies expect a further rise in illegal pharmaceutical sales in Poland in the near future (under Polish law non-pharmacy online medication sales are illegal, most products sold through such channels are falsifications). Those surveyed also expected a rise in direct sales, almost 60% of them convinced that their growth will exceed that of the entire market. Slowest to grow will be sales through herbal shops and so-called exclusive sales (through one producer-selected outlet). In each case 27% of those surveyed maintained these channels will grow slower than the market. According to AESGP the Polish pharmaceutical market is the sixth-biggest in the EU saleswise and second in sales growth after Spain (in EUR). In 2008 the value of the Polish pharmaceutical market (in EUR) rose 17.7% against the previous year at an EU average of only 3.7%. The growth of the Polish pharmaceutical market will also be driven by the fact that per-capita medication sales in Poland are still lower than in the western countries. Coupled with the gradual disappearance of income differences, this will translate into higher medication spending. Another growth factor is the gradual ageing of the Polish population – a growing elderly population, often suffering from several ailments simultaneously, will boost the demand for pharmaceutical products. ::

Medication categories (ATC) whose sales growth in the next two years will exceed the growth of the pharmaceutical market (according to pharmaceutical companies)

Main hindrances in the pharmaceutical sector

Non-transparent Non-transparent

and

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N=75. The surveyed companies could provide more than one answer. Source: KPMG, PMR Research, 2009

N=75. The surveyed companies could provide no more than three answers. Source: KPMG, PMR Research, 2009

polish market :: 3/2011

10%

20%

30%

40%

20%

40%

60%

80%

Science and Innovation

Most Productive Companies The report on Poland’s Most Productive Companies was drawn up by BIGRAM (www.bigram.pl), the sole Polish partner of Proﬁles International, a global supplier of management evaluation tools. The prestigious ranking of the Most Productive Companies is currently published in a few dozen countries all over the world. In 2010, Poland became one of them. Iwona Stefańczyk

The author is a Consultant at Proﬁles International BIGRAM SA Personnel Consulting.

The report is based on productivity regarding human capital broken down into industries and economic sectors. The labour productivity index is the result of dividing companies’ annual turnover ﬁ gures by the number of full-time workers. The report features 48 companies – leaders in their respective ﬁelds with regard to productivity in human capital management. It is based on data disclosed by companies and information from a well-known international business intelligence agency. It should be added that the Most Productive Companies reports are made under the same assumptions everywhere.

Chemical and Pharmaceutical category – Pharmaceutical production No.

Name

1 LEK SA

4003556.58

2 GLAXOSMITHKLINE PHARMACEUTICALS SA

1768710.63

3 NYCOMED PHARMA Sp. z o.o.

1144501.49

4 US PHARMACIA Sp. z o.o.

963396.48

5 AFLOFARM Fabryka Leków Sp. z o.o

847364.59

6 NOVARTIS Poland Sp. z o.o.

838382.23

7 KRK POLSKA Sp. z o.o.

734776.03

8 ELI LILLY POLSKA Sp. z o.o.

708465.50

9 Zakłady Farmaceutyczne POLPHARMA SA

653851.73

10 Ibsen Poland Sp. z o.o.

523778.47

11 Aﬂofarm Farmacja Polska Sp. z o.o.

480697.66

We conducted our research, willing to underline the importance of proper human capital management and the necessity to take up conscious, well thought-out actions in that respect, as only such activities bear positive results. The main objective of the BIGRAM’s initiative was to honour the most productive enterprises on the one hand, and encourage the Polish organizations to pay closer attention to their HR strategies and ways of their optimization on the other. The key to success is not the number of employees, but their proper selection and competencies. People, not machines, are the source of successes and failures in any business venture. The

Medical Services category – Health Care No.

Name

INSTYTUT FIZJOLOGII I PATOLOGII SŁUCHU (Institute of Physiology and Pathology of Hearing)

Productivity (in PLN) 386491.60

2 American Heart of Poland Sp. z o.o.

311172.65

3 MEDICOVER Sp. z o.o.

235606.80

4 UJASTEK Sp. z o.o. Sp.k.

232561.71

5 GEERS Akustyka Słuchu Sp. z o.o.

157967.98

Zakład Opieki Zdrowotnej Ministerstwa Spraw Wewnętrznych i Administracji (Medical Clinic at the Ministry of Internal Aﬀ airs and Administration)

157959.29

7 Miedziowe Centrum Zdrowia SA

148562.54

Samodzielny Publiczny Zakład Opieki Zdrowotnej CHORZOWSKIE CENTRUM Pediatrii 8 i Onkologii im. Dr. Edwarda Hankego (Edward Hanke Clinic of Pediatrics and Oncology in Chorzów)

133366.55

9 EMC Instytut Medyczny SA

130918.00

Zakład Opieki Zdrowotnej Ministerstwa Spraw Wewnętrznych i Administracji w Szczecinie 10 (Medical Clinic at the Ministry of Internal Aﬀ airs and Administration in Szczecin)

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polish market :: 3/2011

Productivity (in PLN)

129956.24

return on investment rate (ROI) may be always increased on the basis of recruitment decisions, if they are made in accordance with facts and measurable factors conducive to professional success. The Profiles International tools offered by BIGRAM have been devised to meet that purpose: the Profi lXT™ questionnaire, and the CheckPoint 360° feedback assessment system. These are proved, effective solutions built on the experiences of companies and managers from over 120 countries, available in 32 languages. To know more, please visit www.profi les.pl. Taking into consideration the long experience of BIGRAM, we know that well recruited people and their teams – along with the market and company potential – are often capable of changing within a short period the status quo of entire industries and whole economy sectors. They can defeat former leaders or lay out new development paths. We hope that such managers and teams will be employed by Polish companies in 2011. Readers interested in getting familiar with (and downloading) the whole report, are asked to visit: www. polandsmostproductive.com. We are happy to inform you that the next edition of the BIGRAM & Profi les International report: Poland’s Most Productive Companies will be published in the second half of 2011, on the basis of 2010 data. ::

www.elzab.com.pl

Fiscal sales registering? We’ve got effective cure for it?

Established in 1969 4 Infosystem Awards 5 European Awards

Fiscal printer with electronic journal ELZAB Mera FE · dedicated to medical services and pharmacies · electronic journal uses microSD card · reducing cost of printing receipts’ copies · paper roll 80 meters long · 40 characters in the row printed · swivel and rotable LCD or TFT displays · small footprint · RS and USB interfaces

ELZAB SA is the European manufacturer of the retail equipment. Our products are exported to Slovakia, Hungary p and Greece.

In cooperation with Cash Bases UK we manufacture sophisticated cash drawer for European markets.

ELZAB SA is also the manufacturer of checkout and platform scales of stainless steel.

Science and Innovation

Preclinical Research Centre

Technology transfer underway Professor Marek Krawczyk, leading transplant surgeon and Rector of the Medical University of Warsaw (WUM), tells “Polish Market” about the university’s involvement in public and academic projects promoting translational medicine, ties between science and industry and innovation, and its unique Preclinical Research Center.

Almost 60% of all investment in Poland goes into intellectual resources. WUM is also in the course of a major project – a Preclinical Research Center. How will it help raise the transfer of new technology from research labs to the economy? We laid the cornerstone under the centre last September, the ceremony was attended by Science and Higher Education Minister Barbara Kudrycka. Its main task will be high-grade research on innovative technologies and solutions which will then be introduced into industry. It will be a lab open not just to our staﬀ but all involved in research in clinics and the pharmaceutical branch. In its work as a knowledge, technology transfer and innovation promoter, the centre will constitute part of a Europewide research system. Today science and industry need to build lasting ties and to do this they must overcome the diﬀerences

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polish market :: 3/2011

in interests and work methods that divide them. Innovation can’t be planned, but we can build a system enabling the transfer of scientific fi ndings to the economy. What is needed is a professional, dynamic team of technology transfer experts. Also necessary are changes in fi nancing and legislation. Certain regulations must be relaxed as they hamper knowledge transfer and fi nancing. Of course we know that building an environmental research unit will be a big fi nancial challenge and that we won’t get research funds. It is our projects that have to make the money needed to run the centre. Funds will be easier to raise if the research conducted in our centre fi nds application in the pharmaceutical industry, or even everyday life. How does biomedical research affect the economy? Medicine has an enormous influence on the economy. Without science many things would never change. The weak point in the Polish system is that industry does not co-fi nance research and there are no laws to regulate this. Despite all these difficulties we have quite intensive contacts with other academic centres. In January we sealed a cooperation accord with the Warsaw University of Technology under

Science and Innovation

Didactic-Library-Information Centre

which we are testing the bio-materials it has developed for use in orthopaedics and bone tissue reconstructions after major cancer operations. Such materials have to be thoroughly tested before they come on the market, and this is when a unit like ours comes in. Therefore, I can safely say that the transfer of medical knowledge to industry is a fact today and gaining on momentum fast. Soon we will also be working together with Warsaw University’s Heavy Ion Research Institute, which is preparing to produce radioisotopes. Today we have to buy radioisotopes needed for positron emission tomography (PET) in Austria, although the Heavy Ion Institute is practically on the other side of the street. Once it launches production we’ll be able to use its radioisotopes for our diagnostic tests and won’t have to buy them abroad. What other projects are you involved in? Th is year we will open a Didactic-Library-Information Centre which will be much more than just a library. It will stand in Żwirki i Wigury Street and will house the volumes we already have, but primarily it will be an open library accessible online and providing all world literature. The centre will also feature other digitalized material and will generally be a huge technological leap for us. For the past six decades we’ve been using makeshift

library facilities opened in 1949. So the centre will be, so to speak, not only a milestone but a many-mile step into the future. We are also building a children’s hospital and a sports and rehab centre. The child clinic should open in 3-4 years. Mazowieckie province lacks paediatric hospitals and those that do exist are below 21st-century standards. We are building a modern, child- and mother-friendly clinic oﬀering specialistic diagnostics and treatment, it will also run research and train medical students. We’re also ready to start with a sports and rehab centre which will have a dual function as it will promote

Paediatric Hospital

academic and professional sports. The centre will be open for all Warsaw students, not just ours. In its capacity as a professional sports centre, the facility will function as a strategic unit in preparing Olympic swimmers. Today Warsaw has no Olympic-size swimming pool and the Sport Ministry has decided to meet us halfway and co-ﬁ nance one. Together we plan to create conditions for the growth of professional sports, including rejuvenation facilities for competitors. The above-described projects show that our school is involved in furthering social development. Interview: Sandra Wierzbicka

Sports-Rehabilitation Centre

3/2011 :: polish market ::

Science and Innovation

Private healthcare networks The private healthcare market in Poland is growing annually by about 20%. According to the estimates by Frost & Sullivan, a global consulting company, the value of the Polish private healthcare market in 2009 amounted to PLN12.88 billion. It is estimated that in 2014 it will exceed PLN20 billion.

Currently the biggest private medical network is managed by Mid Europa Partners, a Central European investment fund that owns the LuxMed network, which also includes facilities under the names Medycyna Rodzinna, Promedis and LIM Medical Centres. The entire network comprises 73 own clinics, 1300 partner clinics and 23 health centres. The second place on the market is occupied by Medicover, and the third by Enel-Med. LuxMed has a network of clinics in: Warsaw, Szczecin, Gdańsk, Gdynia, Olsztyn, Bydgoszcz, Bielsk Podlaski, Poznań, Łódź, Wrocław, Opole, Katowice, Tychy and Kraków, and it cooperates with over 1000 partner medical companies across the country. The company provides healthcare to 400,000 corporate clients under longterm contracts. LIM Medical Centre, established in 1991, was one of the ﬁ rst private healthcare centres. LIM operates 17 medical centres in the country’s largest cities. The company also cooperates with over 380 partner facilities all over Poland. Currently, LIM provides healthcare to about 200,000 corporate clients. LuxMed also runs a modern diagnostic imaging centre AVI, whose main area of activity is CT and MRI scanning. Another is rehabilitation. AVI specialises in the treatment and rehabilitation of patients after orthopaedic surgery, with spine disorders, and other diseases of motor organs. Another LuxMed initiative is FADO, providing mainly mammography services. FADO is the biggest

26 ::

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healthcare provider in the Breast Cancer Prevention Programme in Poland. The company owns 12 “mammobuses” and conducts mammographic examinations in 14 provinces - Dolnośląskie, Lubuskie, Mazowieckie, Opolskie, Pomorskie, Warmińsko-Mazurskie, Wielkopolskie, Zachodniopomorskie, Lubelskie, Łódzkie, Podlaskie, Kujawsko-Pomorskie, Świętokrzyskie and Opolskie. 4,000 doctors representing over 40 medical specialisations provide care to patients in LuxMed Medical Centres. There are almost 400 professors and medical PhD holders among them. LuxMed runs the One Day Surgery Hospital, which was established in 2010 in Warsaw. Patients can beneﬁt from the hospital’s services either by paying fees or within the contract with the National Health Fund (NFZ). The Hospital’s range of services includes surgery in the ﬁelds of general, urological, vascular, oncologic, plastic, paediatric, orthopaedic, gynaecological and laryngological surgeries. Medicover is an international medical company that provides healthcare to over 500,000 patients in Poland. It has 22 Medicover centres providing a wide range of medical services in Poland’s biggest cities - Białystok, Bydgoszcz, Gdańsk, Gdynia, Gliwice, Katowice, Kraków, Lublin, Łódź, Poznań, Szczecin, Warsaw and Wrocław. It also cooperates with over 1,000 medical centres. Medicover employs over 1,400 and cooperates with 9,000 doctors. The recently-opened Medicover Hospital is the biggest private hospital in the country. It features intensive care, post-surgery care, neo-natal intensive care, cardiology intensivecare units, and monitored observation

rooms. The Medicover hospital provides hospital care in gynaecology, the pathology of pregnancy, obstetrics, neonatology, paediatrics, internal diseases, angiology, cardiology, interventional cardiology, surgery, orthopaedics, urology, laryngology, plastic and oral surgery, and intensive care. The Medicover hospital runs 7 clinics. The wards are arranged to hold 270 beds. Damian’s Medical Centre has been active since 1994. Since 2009 the majority of its shares are owned by the Medicover Group. It runs five outpatient clinics and a hospital, while cooperating with over 200 outpatient clinics all over the country. Damian’s Hospital in Warsaw is a surgical and diagnostic centre, with a one-day surgery unit. It is one of the oldest private hospitals in Warsaw – it was established in 1995. Its obstetrics ward enjoys great popularity, with about 650 babies born every year. The surgery unit provides general, plastic, vascular, oncologic, paediatric, orthopaedic, gynaecological and obstetric, urological, neurological, and laryngological surgeries (classic and endoscopic methods). The hospital also provides treatment for patients with snoring syndromes and sleep apnoea. The Enel-Med Medical Centre is a Polish family company. The fi rst specialist outpatient clinic was opened in 1993 in Warsaw. The fi rst Enel-Med hospital was established in 1998, with 19 beds, and paediatric, vascular, general, plastic, gynaecological, laryngological, neurological, ophthalmological, orthopaedic and trauma surgeries. Enel-Med runs 10 branches (in Łódź, Kraków, Lublin, Łomża, Mielec, Poznań, Warsaw, Wołomin, and Wrocław), 7 diagnostics labs and a multi-profi le hospital. The network also contains 508 facilities of medical partners. Enel-Med cooperates with over 760 doctors representing 58 specialities. Enel-Med will make its debut on the Warsaw Stock Exchange in the first

Science and Innovation

half of 2011. In December, Enel-Med’s prospectus was ﬁ led with the Polish Financial Supervision Authority. The funds from the issue are to go to investments in a new hospital, the diagnostic imaging and radiology markets, and the expansion of the network of outpatient clinics. Falck Medycyna is a Scandinavian company listed on the Copenhagen Stock Exchange that entered Poland in 1993. It has its branches in the 7 biggest Polish cities, and over 200 partner facilities. Falck provides individual medical care to about 30,000 people, and over 85,000 employees. It employs over 2,000 people, mainly doctors specialising in various ﬁelds of medicine. Falck specialises in medical rescue, medical transport, and providing healthcare for mass events. It also provides preventive treatment, occupational health examinations, an individual healthcare programme for

companies, on-site company clinics, home visits, home nursing, specialist out-patient specialities clinic treatment, diagnostic examination, laboratory examination, and dentistry services. Polmed has been active since 1999. It made its debut on the Warsaw Stock Exchange last year. It provides basic healthcare and diagnostics through a network of own medical centres (Warsaw, Gdańsk, Gdynia, Katowice, Kraków, Olsztyn, Sosnowiec, Starogard Gdański) and over 800 medical partners. Each Centre provides at least one doctor from basic specialities, e.g. surgeons, dermatologists, gynaecologists, cardiologists, allergologists, endocrinologists, internists, laryngologists, neurologists, ophthalmologists, orthopaedists, paediatricians, and rheumatologists. In the ﬁ rst half of 2011, the company intends to open four new facilities

- in Poznań, Warsaw, Gdańsk, and Wrocław. In the second half of the year Polmed wants to realise its objective to open a new modern medical centre in Warsaw. Another private medical network listed on the stock exchange is EuroMediCare EMC Medical Institute. The company was established in 2001, and opened a hospital in Wrocław a year later. It is probably the non-public specialist hospital which wins awards most frequently. In 2004 the EuroMediCare hospital opened near Opole. After entering the stock exchange in 2005, EMC opened another hospital – in Kamień Pomorski – and acquired a network of outpatient clinics in Lubin. Currently, the network owns 11 facilities in Poland and 2 in Ireland. It specialises in surgery, including maxillofacial and plastic surgery and obesity treatment. It also provides standard subscriptions to companies. ::

INVEST IN ZAMOŚĆ! In 1580, Chancellor Jan Zamoyski began the construction of Zamość – an Ideal Town. Designed by an Italian architect, Bernardo Morando, it was located at the intersection of trade routes running from the north to the south of Europe and from Asia to the west of our continent. Locating Zamość on that site was one of the factors in its dynamic development. Today, over 400 years later, Zamość is a city friendly to its residents and open to investors. There are two transportation routes running through it – the S-17 national road connecting Warsaw and Lvov, which is a section of the Via Intermare (the Baltic Sea – the Black Sea) transport corridor, and the national road No. 74 connecting the Zosin-Ustylug border crossing with central Poland and the Broad-Gauge Metallurgy Line connecting the Upper Silesian with the Ukrainian and Russian railway systems. Located 60 km from Zamość are PolishUkrainian border crossings: Hrebenne – RavaRuska (a road and rail crossing on the route from Warsaw to Lvov), Hrubieszów – Izov (a rail crossing on the route from the Upper Silesia to Kiev), and Zosin – Ustylug (a road crossing on the route from central Poland to Kiev).

The fact that Zamość is situated at a crossing point of international road and rail routes, close to the Polish-Ukrainian border, has created very favourable conditions for the management of international trade and transit, as well as for the organisation of logistic centres designated not only to cooperate with Ukraine, but also to run manufacturing operations. In 2009 the Zamość Subzone was set up, as part of the Euro-Park Mielec Special Economic Zone (SEZ). Dynamic initiatives on the part of the city’s authorities very soon aroused investors’ interest in Zamość. Entities granted permits in 2010 declared investment expenditures in the amount of PLN33 million and taken up a considerable part of the 35 ha belonging to the Subzone. A privilege characteristic for special economic zones is the tax exemption for investors. The level of such an exemption on account of the cost of a new investment amounts to 50% of incurred investment expenditures for large enterprises; in the case of medium-sized entities this is 60% and 70% for small companies. Apart from statutory tax exemptions applicable in Economic Zones, at the motion of the Mayor of Zamość,

the City Council has passed a resolution on the introduction of exemptions from real estate tax for entrepreneurs conducting business activities within the Zamość Economic Zone. The maximum period of exemption is 4 years, depending on the number of jobs created. More information on the Euro-Park Mielec SEZ Zamość Subzone, is available on the following website www.investoneast.eu.

3/2011 :: polish market ::

Science and Innovation

Recount of 2010 in the medical industry Anna Rulkiewicz, President of the LUX MED Group

In the nearest future the medical services market will cease to grow as dynamically as it has so far, and thus of highest significance will become the good management of relations with the patients and the clients. Having all the LUX MED Group patients in mind, both the current and the future ones, last year we implemented projects streamlining the centre operations and our customer service. We developed a Book of Non-Medical Standards, common for all the LUX MED Group facilities, unambiguously defi ning the principles of patient service uniform for the entire Group. In summer 2010, the medical and administration personnel of the LUX MED Group medical centres from all over Poland underwent a thorough training in customer service. Moreover, we supervise the standard implementation on an ongoing basis, by conducting cyclical audits in this area. Last year was a period of intensive searching for new markets and opportunities to get involved in other segments. In terms of the number of facilities, the company achieved a satisfactory level. Th is is why now we plan to open new outpatient centres only in those localities where there is a clear need for such a service from the patients. Hence, in 2010, we put into operation two LUX MED medical centres – in Gdańsk and Gdynia – and two facilities under a new brand: PROFEMED, dedicated specifically to the “fee for service” clients – persons not having our Patient Card and paying separately for each service. We believe that in the area of outpatient servicing the market is limited in terms of mergers and acquisitions providing

28 ::

polish market :: 3/2011

interesting synergy results. Thus, in this aspect, we focus on the organic growth and continuous improvement of the standard of care. In the early 2010, owing to LUX MED Tabita, we took our fi rst steps on a new market – care homes. In May, a new wing of the Tabita facility (in which we are a majority shareholder) was opened. In total, the KonstancinJeziorna care home offers 94 rooms, a rehabilitation centre with long-term and day stay option, as well as a care and therapeutic unit with 24-h medical care. If this model proves effective, we will consider further growth on this market – also through acquisitions. We also wish to develop in specialist areas, such as diagnostics – both organically and through acquisitions. In autumn, Mid Europa Partners, the owner of LUX MED Sp. z o.o., founded the LUX MED Diagnostics company which is to supervise the provision by the LUX MED Group of diagnostic imaging services, the management of diagnostic companies already belonging to the LUX MED Group, as well as the acquisition of new entities. The year 2010 was also marked for the LUX MED Group by the opening of the fi rst hospital. From the time of performing first procedures in late August 2010, the LUX MED Group Hospital has been systematically servicing more and more patients, and has been offering new services. The performed procedures include those in the area of general, urologic, vascular and plastic surgery, as well as orthopaedics, gynaecology and laryngology. There is

also operating the Emergency Care Department providing assistance in emergencies, such as wound stitching, dressing change, foreign body removal, care for burns and the eyelid and eyebrow ridge wounds, dislocations, fractures, etc. In addition, the Hospital offers diagnostic imaging, gastrointestinal tract endoscopy, as well as (provided at the on-site clinic) consultations qualifying for procedures, post-operative consultations and the aesthetic medicine unit. The hospital operations were organised based on the specialist therapeutic and diagnostic centres organising the hospitalisation – from the moment of qualification to the convalescence at the stay ward. Currently, the following are available at the facility: :: Hernia Treatment Centre, :: Vascular Disease Treatment Centre, :: Proctology Centre, :: Plastic Surgery Centre, :: Gastrointestinal Tract Endoscopy Centre. In future, more specialist centres are planned. The excellent balance the facility achieved so far reinforces our belief that investing in hospital care is the right direction for growth. And so, we are planning for yet another hospital – a multi-profile one, boasting 50–60 beds. The investment will probably be initiated in the middle of 2011, and the facility will be opened within three years. ::

Science and Innovation

Polish Market Honorary Pearls “Polish Market” has been awarding Honorary Pearls since 2006. They are granted to those who have rendered special services to the economy, science, culture and the promotion of patriotic and social values. In this edition we look back at the achievements of the award-winners in the ﬁeld of science.

2007 Professor Alicja Chybicka Head of Children’s Bone Marrow Transplant, Oncology and Haematology Clinic at the Wrocław Medical University and the head of Polish Paediatrics Association. She has introduced advanced methods thanks to which her clinic boasts an 80% success rate in treatment of children and a high rate of successful marrow transplants.

2006 Professor Henryk Skarżyński Founder and head of the Institute of Physiology and Pathology of Hearing. He developed pioneering medical treatments and procedures – the treatment of total deafness by cochlear implants and cerebral core implants, early diagnosis of hearing disorders in newborns and infants, a unique online hearing, speech and eyesight programme, the world’s ﬁ rst treatment for partially deaf adults. He also performed the world’s ﬁ rst operation on a partially deaf child. He initiated the International Hearing and Speech Centre where he performs the world’s largest number of corrective operations.

2008

Professor Jan Lubiński

Professor Norman Davies

Outstanding geneticist and cancer specialist, founder and director of the Genetics and Pathological Morphology Department at the Pomeranian Medical University in Szczecin. He launched Poland’s ﬁ rst genetic Oncology Consultancy Clinic in 1992 and discovered that genetic factors are crucial in triggering cancer. He launched Read Gene to commercialize methods of detection, prevention and treatment of the most common types of malignant tumours.

Perhaps the best known historian who has made Poland one of his main ﬁelds of research and writes about its history in a way everyone can read. His best-known works include “God’s Playground. A History of Poland”, “Europe: A History” and “Rising ’44. The Battle of Warsaw.” He was honoured with the Order of Polonia Restituta and the Order of Merit of the Republic of Poland.

30 ::

polish market :: 3/2011

Science and Innovation

2009 2009

Professor Maria Siemionow

Professor Maciej Nowicki Ecologist, scientist and social activist. Former Minster of the Environment and Chairman of the 14th UN Climate Change Conference (COP14). In 1992, he founded the Eco-Fund Foundation dealing with the eco-conversion of Poland’s debt and became Deputy Chairman of the UN Commission on Sustainable Development.

2009 Professor Bogdan Marciniec A world authority on silicon chemistry. He is Poland’s pioneer in forging ties between R&D and industry. He is the founder of Poland’s fi rst university spin-off in Tarnów and the country’s fi rst Science and Technology Park in Poznań.

Transplant surgeon whose full-face transplant was internationally acclaimed as breakthrough in modern surgery. She has headed the plastic and microsurgery department at the Cleveland Clinic since 1995. In 2008 she successfully transplanted about 80% of the face of a woman who was the victim of a shooting incident. It was America’s ﬁ rst such operation.

2010

Professor Karol Myśliwiec

Professor Marian Zembala

Archaeologist and Egyptologist, director of the Mediterranean Archaeology Institute at the Polish Academy of Sciences, who continues Polish research on ancient Egypt brining outstanding archaeological discoveries. He is renowned for his work at Saqqara, at the west side of Pharaoh Djoser’s Step Pyramid leading to the discovery of the tomb of Imhotep.

An outstanding cardiologist, director of the Silesian Centre for Heart Diseases in Zabrze, member of the Polish Transplantation Board and former president of the Polish Society of Organ Transplantation. He introduced mapping during a surgery and surgical treatment of intra-ventricular tachycardia in ischaemic heart disease.

3/2011 :: polish market ::

Science and Innovation

2011 – The year of Maria Skłodowska-Curie 100 years ago, in 1911 Polish scientist Maria Skłodowska-Curie became a Nobel Prize laureate in chemistry. Prior to that, in 1903, together with her husband Pierre Curie and Henri Becquerel, she received the Nobel Prize in physics. To this day she is the only woman honoured with two Nobel Prizes in two different scientific fields. Her breakthrough discoveries of radioactive elements were the beginnings of nuclear physics and chemistry. They also laid the groundwork for radiology and radiochemistry.

Maria Skłodowska-Curie was born on 7 November 1867 in Warsaw. She was talented in multiple areas: she spoke five languages, was interested in psychology, sociology, natural sciences and drawing. She did however choose natural sciences. She signed up at the department of mathematics and natural sciences at the Sorbonne in 1891, because no university in the then partitioned Poland accepted women. She completed studies after three years with a degree in physics, and a year later, she received a degree in mathematics. In 1895 she married Pierre Curie, a prominent French physicist. Their joint scientific work led to the separation of two radioactive elements – polonium and radium. They received the Nobel Prize in physics for this discovery in 1903. In the same year, Maria Skłodowska-Curie earned a doctorate, and became a director of the laboratory at the Sorbonne’s Physics Department. After the death of her husband, who died following an accident in 1906, she took over the Physics Department and became the fi rst woman lecturing at the Sorbonne. She continued research on her own, which led to the production of metallic radium. She also worked out methods for the exact measurement of radioactivity of radium preparations as well as the isolation and purification of radioactive elements, for which she received the second Nobel Prize, this time in the field of chemistry. Living in France, Maria Skłodowska-Curie has never broken-off ties with her native country. She travelled to Poland on many occasions during 1899-1913 for both work and

32 ::

polish market :: 3/2011

private purposes. She delivered lectures and published her works in Polish scientiﬁc journals. Many Poles were involved in her Paris laboratory and later gone on and continued work back at home. In Paris, she worked at the Radium Institute – a newly created medical research centre. When World War I broke out, Maria Skłodowska-Curie went to the front, where she trained medical personnel in X-ray scanning of wounded soldiers and organised mobile X-ray stations. The history of X-ray scanning is an excellent example of

the enormous and difficult to predict range of practical uses there may be for a purely scientific discovery. She went on two important trips to the USA following the war. In 1921, she brought money to equip the Radium Institute in Paris, and in 1929, she raised funds to build a sister facility in Warsaw. The scientist’s dream that Poles had a modern laboratory and hospital as the one she worked for in Paris, came true. In 1932 she arrived for the inauguration of the Radium Institute in Warsaw, at Wawelska Street (presently the Maria SkłodowskaCurie Memorial Cancer Centre and Institute of Oncology). It was her last visit to the homeland. She died in 1934 and was buried in Sceaux, France. In 1995, her and her husband’s remains were moved to the Paris Pantheon. Maria Skłodowska-Curie is the only woman to rest in the Pantheon. To honour one of the country’s most eminent scientists, whose discoveries have contributed to science across the world, the Parliament of the Republic of Poland has proclaimed 2011 as the year of Maria SkłodowskaCurie (MSC100). The hundredth anniversary of Maria Skłodowska Curie receiving the Nobel Prize fits very well with the celebrations of the International Year of Chemistry (IYC 2011), proclaimed by UNESCO. The celebrations programme for IYC2011 and MCS100 is very rich. Its organisers and coordinators are: the Polish Chemical Society, the Maria Skłodowska-Curie Museum in Warsaw and the Committee of Chemistry Polish Academy of Sciences. During the year, over a dozen international scientific congresses and conferences, over a dozen symposiums and seminars, sessions of scientific associations and many accompanying events, including, knowledge and art competitions for schools will take place. The programme of celebrations also includes a new exposition at the Maria Skłodowska-Curie Museum, an exhibit dedicated to the Polish Nobel Prize recipient at the European Parliament, the “Unappreciated Women in Science” exhibit. The conclusion of the celebrations, combined with a scientific session, is expected on 25 November of this year at the Royal Castle in Warsaw. :: HK

Science and Innovation

Science and technology parks – role, eﬀectiveness Małgorzata Okularczyk

The author is Head of Public Consulting Section, Collect Consulting.

Innovation is the general goal Poland has set itself for the coming years. Poland is by no means alone in this, innovation being one of the major targets listed in the EU’s Lisbon Strategy. The EU programme for 2007-2013 gave Poland huge possibilities of support for innovation projects. Billions of euros from the European Regional Development Fund enabled the countrywide foundation and development of modern science and technology parks. Knowledge and technology transfer is no spontaneous grassroots process which runs by itself. It requires the right atmosphere and conditions allowing innovatory companies to sprout and grow. And this, precisely, is what science and technology parks are for – to provide advanced research facilities and create a positive climate around innovative enterprise. Science and technology parks are to: :: stimulate and oversee the flow of knowledge and technology from academic and R&D centres to enterprises and the market; :: promote the creation and development of innovationbased enterprises (spin-off, spin-out); :: raise the innovatory value of fi rms by providing highquality facilities and a broad range of supporting services. In Poland science and technology parks appeared well over a decade ago. The fi rst one opened in Poznań in 1995, today about 40 projects are in various stages of completion. The park in Sosnowiec is still in the blueprint phase, the one in Kielce is currently being fitted with infrastructure and R&D facilities, others, like Wrocław Technology Park, are operating at full steam. In all, around 600 domestic and foreign companies as well as investors are located in science and technology parks countrywide. Also present there, of course, are research and fi nancing institutions. Together Poland’s technology parks employ around 17,000. Polish science and technology parks provide a range of services. They offer land, buildings and infrastructure, the latter depending on a park’s character and development stage. Companies and institutions are offered office, service, lab and production facilities. Greenfield projects are rarer in science and technology parks. It is very important for enterprisers to have access to modern, R&D equipment, with whose help they are able to conduct their own research and generate innovative solutions. Th is is especially crucial for startups and SMEs, who would otherwise be unable to use such facilities owing to the exorbitant costs. The parks also offer business consulting, training, assistance in

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polish market :: 3/2011

securing fi nancial sources (especially EU funds), as well as advice in technology transfer and patent issues. They also organize seminars, conferences and other meetings enabling enterprisers to exchange experiences and knowledge. Also developing – albeit still in a modest degree – are various fi nancing options for technology park tenants. Already working are the fi rst loan and venture/private equity funds, there is also some cooperation with so-called “business angels” and crediting institutions. Therefore, science and technology parks have a constantly expanding range of services today. In keeping with global trends Poland’s parks are also beginning to specialize in chosen fields, mostly of strategic importance for their region. Consequently, parks now select the organizations they host or work with. An example is the Euro Centrum Science and Technology Park, which specializes in energy-efficient technology and energy saving in buildings, or the Cracow Technology Park which concentrates on IT. Science and technology parks in Poland are becoming more and more effective and are steadily attracting rising numbers of organizations. Th is helps consolidate bonds between science and enterprise, found new companies and develop solutions and technology for commercial use. Slowly but surely Poland is becoming an innovative country. Most science and technology parks in Poland are still financed from EU funds, only a few can afford to run themselves. To change this we need to improve the processes used to commercialize and transfer technology to the market. Th is will help parks become even more effective in building a knowledge-based economy and generating profit. Time will show if we will be successful. ::

Science and technology parks in Poland are becoming more and more eﬀ ective and are steadily attracting rising numbers of organizations. This helps consolidate bonds between science and enterprise, found new companies and develop solutions and technology for commercial use. Slowly but surely Poland is becoming an innovative country.

Institute of Non-Ferrous Metals in Gliwice

Modern R&D base for non-ferrous metals industry Institute of Non-Ferrous Metals in Gliwice is the main R&D centre of Polish non-ferrous metals industry of unique character, both on Polish and international scale. The Institute conducts complex and full scale research studies in the area of all non-ferrous metals, especially Cu, Al, Zn, Pb, Ag, related to: :: treatment of mineral and secondary resources :: pyrometallurgy :: hydrometallurgy :: treatment of scrap and waste :: environmental protection :: processing of metals and alloys :: material science of metals and new materials :: chemical current sources :: analytical chemistry IMN offers innovative solutions and cooperates in development of complex new technologies and products.

Our chief assets :: Highly qualified staff of over 400 employees :: Knowledge, expertise and experience in running complex studies from lab scale to piloting :: modern, accredited laboratories :: pilot and semi-industrial installations for running full scale studies :: experience in international cooperation and projects :: cooperation with non-ferrous metals and mineral resources industries :: specialized production of: flotation machines, equipment for casting of light metals, contact materials, brazing alloys, amorphous materials, clad wires.

Instytut Metali NieĹźelaznych 44-100 Gliwice ul. SowiĹ&#x201E;skiego 5 www.imn.gliwice.pl, imn@imn.gliwice.pl tel. +48 32 238 03 00, fax +48 32 302 06 81

Science and Innovation

Innovation dilemmas of Polish businesses Polish industrial enterprises are still more innovative than those providing services, despite the rapid expansion of the service sector in terms of employment and value-added growth. Additionally, research and development (R&D), as well as technological innovation play a much more signiﬁcant role in industrial innovation. Elżbieta Wojnicka, PhD

Elżbieta Wojnicka PhD, lecturer at the Institute of Organisation and Management of the University of Gdańsk, expert and consultant on innovation, regional development and European integration. Author of expert reports, among others, for OECD, Industrial Development Agency, Polish Agency for Enterprise Development, the Ministry of Regional Development and Province Chairmen’s Offices.

In 2006-2008, around 21.3% of businesses operating in the industrial sector and providing employment to more than nine people, introduced some innovations, down from 23.2% in the years 2004-2006. Innovation activity was higher only in the group of small businesses, with 14.6% of them having introduced product and process innovations in 2006-2008, compared to 13.7% in 2004-2006 and 17% in 2002 -2004. In the group of mediumsized industrial businesses, the percentage of innovative ﬁ rms amounted to 32.7% in 2006-2008 and was lower than in 2004-2006 and 2002 -2004 when it stood at 37.4% and 40% respectively. The percentage of large businesses which introduced innovations was 60.7% compared to 65.5% in 2004-2006 and 67% in 2002-2004. Although more and more money, mainly from structural funds, is available for supporting innovation in Poland, the involvement of the industrial sector as a whole in innovation activity is on the decrease. An optimistic sign is the growing activity of small businesses, which may be attributed to the fact that the existing support system favours the SME sector. Additionally, it is small businesses that are the source of revolutionary technologies across the world, despite the fact that large companies spend more on research and development than other ﬁ rms. In

The fast increase in R&D spending in Poland in recent years was largely generated by businesses, as indicated by their growing share in the total R&D expenditure

36 ::

polish market :: 3/2011

Poland, large companies are involved in R&D to a small extent only. The reason is that most of them are members of multinational groups, which operate globally and usually have their R&D centres in their country of origin. It is of key importance to encourage these corporations to relocate at least part of their R&D activity to Poland. Multinationals present in Poland are committed to some extent to R&D in the country, but this mostly concerns high-technology services, such as IT services. However, the example of the ICT cluster in the Pomeranian (Pomorskie) province, called WICOMM, which brings together electronics, telecommunications and IT ﬁ rms, including subsidiaries of multinational corporations, shows that foreign companies operating in the electronics sector are willing to work with Polish ﬁ rms and R&D units, as well as to conduct some R&D activity in Poland. Moreover, the value of foreign direct investment (FDI) related to R&D activity was relatively high in Poland in 2010. In general, however, the involvement of foreign companies in R&D in Poland is scarce, which is translated into extremely low R&D expenditure as a proportion of GDP. The R&D spending accounts actually for less than 1% of GDP, which means that if Poland were a closed country with no access to technology transfer from the outside, it would be regressing. The conclusion is that Poland has poor prospects for a civilisational leap forward on the basis of the revolutionary technologies which stimulate the

emergence of new fi rms and sectors providinga number of workplaces. In 2004 and 2006 R&D expenditure in Poland accounted for around 0.56% of GDP compared to the EU average of around 1.8%. In 2008 the percentage edged up to 0.61% of GDP, which means that the increase in R&D spending in Poland in that period was higher than the country’s high economic growth rate. Businesses generated only 30.9% of total R&D spending in 2008. Th is, however, represented a rise from 25% in 2006 [data from the Central Statistical Office]. In 2007 companies’ R&D spending accounted for 30.4% of their total expenditure whilethe total R&D spending represented only 0.57% of GDP. These ratios improved compared to 2004, but were still very low. The R&D spending as a percentage of GDP was slightly higher in 2001 and stood at 0.62%. In 2007 the total amount of money businesses spent on R&D accounted for 0.17% of GDP while the EU average in 2005 was 1.17% [data from the Central Statistical Office]. The fast increase in R&D spending in Poland in recent years was largely generated by businesses, as indicated by their growing share in the total R&D expenditure. Th is is a very optimistic sign – despite weaker innovation activity in the industrial sector, the growth in R&D spending may indicate greater commitment on the part of businesses to work on new innovations, which is likely to produce results in the future, leading to the emergence of strong innovative fi rms in Poland. These are very few currently, and it is something profoundly disquieting for in today’s world, driven by fast technological progress, fi rms have to keep developing and introduce innovation so as not to be squeezed out of the market and go bankrupt. Moreover, it is now believed that innovation generates two thirds of economic growth. As a result, a lower percentage of innovative businesses means slim chances for a rapid economic growth which

Science and Innovation is of vital importance for Poland and should exceed 3% in order to ensure the creation of new jobs. It seems that Polish businesses could enhance their innovation and R&D performance by fostering cooperation between each other and by intensifying their bonds with universities through for example setting up university spin-offs. This would make them stronger relative to large corporations, whose operations are based on extended networks. Research conducted in 2004 showed a positive correlation between higher intensity of agreements for innovation signed with various organisations and the share of revenue from innovation in the total receipts of individual industries. Interactions among businesses in the innovation process, especially cooperation with universities and knowledge-intensive business services, increase chances of new innovation being brought to the industry. Indirectly, they also boost chances of high profitability and a rise in the market share. The educational attainment of employees and their mobility are of special importance for the effectiveness of the innovation process. Businesses which employ a larger number of workers with university degrees have stronger interactions with the R&D sphere, higher innovation and efficiency levels. In recent years, with support of structural funding, there have been many initiatives in Poland aimed at intensifying connections in the innovation system. Technology parks and technology transfer centres are being set up. Links among businesses are increasingly established in the form of clusters and this benefits them directly. Revolutionary technologies may emerge by looking for key technologies at Polish universities and then developing them in cooperation with businesses. The huge predominance multinational corporations enjoy on the market is a serious barrier to the development of Polish industrial enterprises and their entry onto the market. As a result, they have to operate in market niches and as suppliers for multinational corporations. Additionally, they have to be highly innovative and deliver new solutions which may revolutionise individual sectors. A symbiosis is possible between small and large businesses, especially that multinational corporations – although most

38 ::

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of them have developed using revolutionary solutions from home-based businesses – now introduce mainly evolutional solutions. However, small businesses need creative staff. Unfortunately, they often have greater problems with attracting professionals who could put innovation into practice because the average wages they offer are lower. In the Polish small business sector, there are also mental barriers which impede their ability to establish cooperation and join networks. But the existing innovation support programmes have somewhat reduced these contraints, which is reflected in the multitude of cluster initiatives, especially in high-technology sectors. The Central Statistical Office (GUS) has identified the following factors hampering innovation activity: economic factors, that is a shortage of own resources and external funding for innovation activity; excessively high costs involved in introducing innovation; knowledge-related factors, that is deficit of personnel with suitable qualifications and lack of information about technologies and markets; problems with finding suitable partners; and market factors such as excessive market monopolisation and unpredictable demand. Apart from the above factors, low innovation activity on the part of businesses may also be due to the absence of need to undertake such activity or a complete lack of demand for innovation. In each Polish region, the most important factor hampering innovation in 2004-2006 was the economic one. Businesses do not undertake innovation activity because financial shortages. Of slightly less importance are constraints and problems associated with the acquisition of external funding for innovation activity. But it should be noted that financial barriers always come first in any survey among firms and households. Obviously, it is quite a serious problem and measures are taken to tackle it through EU funding, fiscal instruments and loan guarantees. But companies should seek ways to reduce costs of innovation by introducing new business models, including just-in time measures and means designed to prevent wastage. IT businesses are skilfully cutting innovation costs and at the same time overcoming barriers due to intellectual

property protection. For example, they buy only access to specialist programs, which is possible through the Internet, instead of purchasing the programs themselves. Likewise, software producers offer free access to some functionalities of their programs on the Internet while users have to pay for temporary access to all the functionalities. Some of the small industrial enterprises operate in a similar way – they reduce the number of components in their products, without undermining their quality and functionality, so as to be able to compete with cheap imports from China. Heavier than economic barriers are those associated with the activity of businesses, their qualified staff, ability to use external knowledge, marketing skills, strategic planning and ability to conduct market research before introducing a specific innovation. According to GUS research, market factors – in particular unpredictable demand and the domination of a single company on the market – are the second most important category of factors hampering innovation. Factors associated with access to knowledge are the third most important category. In this group of factors, the main problem reported by small and medium businesses is the difficulty finding suitable partners and well-qualified personnel. Equally bothering is a shortage of information about technologies and markets. Moreover, some businesses in Poland see no need for innovation activity at all. This means that their innovation awareness is low, reflecting the general public awareness in this sphere. By the same token, the general public’s understanding of innovation determines the responsiveness of businesses and the their introduction of new technologies. If there is no demand for innovation from the society, businesses will not be pursuing it. But there are other impactful stakeholders too: businesses will have to launch innovation processes if their suppliers and customers start demanding innovative products. ::

By the same token, the general public’s understanding of innovation determines the responsiveness of businesses and the their introduction of new technologies. If there is no demand for innovation from the society, businesses will not be pursuing it.

Science and Innovation

Does business see the need to make use of scientific breakthroughs? Professor Stanisław Bielecki Ph.D., D.Sc., Rector of the Technical University of Lodz (TUL): Although the question appears to be simple, the answer is not simple at all. To go from recognising the need to make use of research results and actually doing it in practice, there are many legal, financial and economic conditions that must be met, without which the technology transfer from the laboratory to the industry cannot be successful. What experiences in this regard does the Technical University of Lodz have? The undertaking of business activity is based on the calculation of its long-term profitability, including the risks that have to be identified and controlled. Th is however involves the existence of predictable and stable conditions for the fi rm’s functioning, and this is something that science has no direct control over. I believe that my personal experiences empower me to affi rm that Polish businessmen are gradually placing more value on innovation. A growing interest of business in new solutions created at our institution is becoming evident. We are having more frequent visits from businesses at the laboratories. Meetings also take place between creators of innovative solutions and business angels and other intermediaries interested in technologies created at our university. In order to intensify the process of encouraging businessscience contacts, we have signed an understanding with the Business Centre Club (BCC). We encourage businessmen to participate in the process of educating engineers, creating new educational programs and faculties, describing common research topics and undertaking common research projects. Businessscience relation is slowly starting to enter a new era in terms of its quality. Th is is understood both by scientists from TUL, who realise that the developed technologies are not of full value without commercialisation and profitability for both sides, and businesses, who are starting to realise to a greater degree that their factories will not stand competition on the open European market, and

40 ::

polish market :: 3/2011

more commonly global, without new innovative technologies. Concisely speaking: it is easy today to produce, more difficult to sell and even more difficult to invent. The guidelines for the new reform of higher education include the necessity for the university to create a legal business entity, which will be responsible for the management of the entire industrial intellectual property of the institution. In April 2009, TUL Transfer Technology Center Ltd. was created at TUL. It is the first company in the country active in the area of technology transfer, whose founder and sole owner is a higher educational institution. Do you think that young people see a chance for their careers in choosing a technical education? How can the youth be convinced to study right here at the Technical University of Lodz? The interest among university candidates in technical fields is constantly growing. We offer our students apprenticeships and internships in reputable domestic and foreign firms, and scholarships that are part of the “Youth in Łódź” programme. Our students have received the highest number of scholarships among the educational institutions in Łódź. TUL is presently the fourth most popular technical university in the country and ninth among 90 Polish academic centres. According to the Ministry of Higher Education and Science (MNiSW) research, TUL is the third most preferred university among candidates. We have admitted 13% more candidates for full-time studies compared with the last academic year. Th is is all due to our continued

work on broadening our educational offer, as well as thanks to greater interest in graduates of technical faculties on the job market. Students are also frequently looking at gaining knowledge and competencies at the highest level, realising what the future expectations from employers may be. TUL is among the best technical universities in Poland. During the latest ranking conducted by MNiSW, over half the faculties have received the highest category – A. We are putting a lot of effort into continuously improving the quality of education at our institution. Thanks to this, TUL is the only institution in Poland and one of 28 in Europe to possess the prestigious educational quality certificate “ECTS Label”, awarded by the European Commission. Which fields at the Technical University of Lodz enjoy the greatest interest? Great interest is focused on the custom ordered fields at TUL. These are fields developed on the requests of MNiSW in relation to the growth of demand on the job market for their graduates. A diploma in one of these fields is almost a guarantee of employment right after graduation, and sometimes even prior to it. A unique and of tremendous interest among TUL fields is enjoyed by the International Faculty of Engineering (IFE). Studies are conducted there entirely in English and French languages, in ten specialisations. 1,000 students are presently enrolled in IFE. An important element of the programme is the stay of all students at an educational institution abroad. In turn, several dozen of foreign students from across all of Europe come to the Centre to hold part of their studies here. We prepare students for professional life so that they are equipped with the knowledge and competence allowing them to compete with other young professionals in the world. At the present – in an era of globalisation – the real value and position in education can be determined primarily in the international context – by cooperation with universities, institutions and businesses. We are continuously widening our capabilities to educate in foreign languages and gaining double diplomas. At the present, double diplomas may be earned in as many as 8 universities in Europe at different levels of education. ::

Science and Innovation

Research at AGH-UST The Polish name AGH, which stands for the Academy of Mining and Metallurgy, makes one think of a university whose education and research activities concentrate mainly on extractive and material processing industries. That was true in the initial stage of the university’s development. At present, AGH-UST is a modern technical university with educational disciplines and research areas relating to the contemporary trends of scientific and technological development. The range of research projects conducted at the university is wide and has always resulted from the structure and contemporary needs throughout the 90-year history of AGH-UST. Among 15 faculties and one multidisciplinary school there are faculties dealing with traditional yet systematically modernised branches of industry and economy (Mining, Drilling, Metallurgy, etc.), faculties connected with particular fields of technical and technological sciences (Geology, Geodesy, Electrical Engineering, etc.), attractive modern disciplines such as Information Technology, Telecommunications, Biomedical Engineering, as well as faculties connected with fundamental sciences (Mathematics, Physics, Geophysics, Sociology). AGH-UST employees and graduates have played and still play an important role in the development of the Polish industry and other branches of economy. The university has a large group of independent researchers and scientists: nearly 300 holding the title of professor, and over 200 with postdoctoral qualifications. Without professional teaching and research staff it would not be possible to ensure a high level of education and research work. Numerous

42 ::

polish market :: 3/2011

and highly-qualified staff are the strength of our university. The university has modern scientific research equipment, which enables us to conduct research at the highest possible level. Examples here can be: the most powerful in this part of Europe microscopes for testing the structures of metals, or the so-called “rigid testing machine”, which allows to examine the processes of rock cracking and crushing, electron microscopes, equipment for complex testing of solid bodies, especially their surface, mass spectrometers, numerous devices and machines for carrying out environmental tests, etc. University authorities value and support international collaboration. We have signed nearly 400 agreements of collaboration and co-operation with universities and scientific research institutions worldwide. Among others, we take part in experiments conducted in particle physics centres of CERN in Geneva and DESY in Hamburg, and centres of synchrotron radiation in Grenoble, Trieste and Hamburg. AGH-UST is a member of many Polish and international organisations. Being their member enables the university to take part in the activities of working parties, international discussions concerning the organisation of educational processes and scientific issues, as well as the restructuring of higher education system in the light of changing external conditions. A significant success of AGH-UST has been its incorporation, as the only Polish university, into the Knowledge and Innovation Community “InnoEnergy” of the European Institute of Innovation and Technology

(EIT). It may be worth emphasizing that on December 16, 2009, the EIT Governing Board approved three Knowledge and Innovation Communities (KICs), including “InnoEnergy”. Part of this community are the so-called “collocation centres” in Karlsruhe, Grenoble, Barcelona, Eindhoven-Leuven, Stockholm and Krakow. In our Polish centre named CC Poland Plus-Krakow the main subject area will be “Clean Coal Technologies”. AGH-UST has been an initiator of establishing the Małopolska-Podkarpacie Cluster of Clean Energy, Cluster of Information Technologies, and the Centre for Advanced Technologies – Małopolska Centre of Materials and Technologies “Akcent”. The university also runs Centres for Excellence, which aim at conducting research in the ﬁelds which have been recognised as fundamental for the Polish economy. AGH-UST is an important centre for the development and transfer of new technologies. Mechanisms are created to facilitate and intensify the transfer of innovative technologies from AGH-UST to entrepreneurs and other external institutions. Research activity of the AGH University of Science and Technology comprises eight subject areas: :: Information Technologies :: New Materials and Technologies :: The Environment and Climate Change :: Energy and its Resources :: Mining :: Electrical and Mechanical Engineering :: Exact and Earth Sciences :: Social-Economic Sciences and Humanities. ::

Science and Innovation

Polish universities in the Webometrics ranking The ranking carried out by commission of the Spanish CSIC organisation lists universities from throughout the world. In terms of the university education level Poland took the 39th place in the latest global ranking published in January 2011. The Webometrics Ranking of World’s Universities this year covered 12,000 schools from throughout the world, including 400 from Poland. The Massachusetts University of Technology (MIT), Harvard University and Stanford University in the United States top the list as the world’s best schools of higher learning. Poland’s Jagiellonian University took the 371st place in the ranking and the Wrocław University of Technology the 430th. The ranking assesses universities ﬁ rst of all in terms of their web performance and communication. It does not focus on analysing their scientific achievements but on the access to their scientiﬁc publications and other academic material on the Internet. Nevertheless, the ranking plays a key part in winning over students from throughout the world. The table we publish presents top universities in Eastern Europe. Source: Webometrics

Webometrics rank

50%

20%

VISIBILITY (external links)

SIZE (web pages)

15% RICH FILES

15% SCHOLAR

44 ::

polish market :: 3/2011

Top Eastern Europe continent rank

university

country

world rank

size visibility rich ﬁles (S) (V) (R)

scholar (Sc)

Masaryk University

Czech Republic

146

184

277

113

Charles University

Czech Republic

169

133

247

415

University of Ljubljana

Slovenia

205

153

314

105

240

Budapest University of Technology and Economics

Hungary

314

324

425

101

527

Eotvos Lorand University (University of Budapest)

Hungary

360

272

489

833

Jagiellonian University

Poland

371

418

481

316

332

Wrocław University of Technology

Poland

430

489

625

363

176

Wrocław University

Poland

548

616

608

299

1,108

AGH University of Science & Technology

Poland

549

404

713

432

687

Adam Mickiewicz University Poznań

Poland

562

747

581

608

623

Warsaw University

Poland

589

506

650

643

714

Warsaw University of Technology

Poland

729

736

760

556

1,222 1,554

Nicolaus Copernicus University

Poland

885

832

903

580

University of Łódź

Poland

892

1,100

902

881

945

Gdańsk University of Technology / Politechnika Gdańska

Poland

906

786

922

726

1,368

Gdańsk University*

Poland

950

1,298

709

1,236

2,251

Technical University of Łódź

Poland

961

1,120

971

723

1,251

Silesian University of Technology in Gliwice

Poland

969

1,166

979

1,138

803

Kraków University of Technology

Poland

971

1,391

949

1,654

1,123

Maria Curie Sklodowska University

Poland

979

1,116

958

819

2,440

Warsaw University Faculty of Mathematics, Informatics and Mechanics

Poland

1,119

1,151

2,091

716

1,484

Poznań University of Technology

Poland

1,186

1,619

2,428

838

1,310

University of Zielona Góra

Poland

1,212

1,824

2,822

1,117

878

Warsaw School of Economics

Poland

1,392

1,134

2,858

984

2,192

Warsaw University Faculty of Physics

Poland

1,392

2,510

2,555

741

1,778

University of Warmia and Mazury

Poland

1,576

1,569

3,120

1,582

1,617

The four ranks were combined according to a formula where each one has a diff erent weight: Size (S). Number of pages recovered from four engines: Google, Yahoo, Live Search and Exalead. For each engine, results are log-normalised to 1 for the highest value. Then for each domain, maximum and minimum results are excluded and every institution is assigned a rank according to the combined sum. Visibility (V). The total number of unique external links received (inlinks) by a site can be only confidently obtained from Yahoo Search. Results are log-normalised to 1 for the highest value and then combined to generate the rank. Rich Files (R). After evaluation of their relevance to academic and publication activities and considering the volume of the diff erent file formats, the following were selected: Adobe Acrobat (.pdf), Adobe PostScript (.ps), Microsoft Word (.doc) and Microsoft Powerpoint (.ppt). These data were extracted using Google and merging the results for each file type after log-normalising in the same way as described before. Scholar (Sc). Google Scholar provides the number of papers and citations for each academic domain. These results from the Scholar database represent papers, reports and other academic items.

Science and Innovation

WSB-NLU in Nowy Sącz and its technology park Nowy SĄcz, the town of Optimus, is facing another opportunity to be noticed internationally, this time owing to the new investment in the Multimedia City Technology Park. The project’s initiator is Wyższa Szkoła Biznesu – National-Louis University (WSB-NLU) – the oldest private university in Poland, established in 1992. Its graduates are the top management of many companies crucial to the Polish economy, which is the best benchmark of its educational quality. The idea of developing a technology park in Nowy Sącz was fi rst conceived in 2006, following the observation of the extreme dynamics of change on the higher-education market and of the directions of development occurring in economies all over the world. It is a response to the need for combining the competence of science and business. The overall concept was based on one of the fastest developing of all sectors – ICT. On 24 August 2010, Miasteczko Multimedialne sp. z o. o. from Nowy Sącz, co-owned by WSB-NLU, signed an agreement with the Polish Agency for Enterprise Development (PARP) for the co-fi nancing of the construction of the Park’s modern infrastructure, in the amount of PLN95 million. Th is decision will lead to the opening in September 2012 of the Park’s state-of-the art infrastructure, boasting specialist facilities (e.g. virtual reality, post-production, motion capture) and a modern office area.

The concept assumes the creation of a global media development centre in Nowy Sącz. On the basis of the platform of cooperation extending across the worlds of science and business, a cutting-edge research and media implementation centre for the purposes of business, science and entertainment will be established. A defi ning feature of the Multimedia City Technology Park will be the comprehensiveness of its services, to include not only support for technology processes in the generation of groundbreaking solutions, but also fi nancial support and extensive counselling in the commercialisation process. At present, the Park features a Business Incubator – Media 3.0 – which will invest about PLN12 million in the development of innovative start-ups in the fields of IT and multimedia. The project enables young people to obtain funds to develop their original ideas of as much as EUR200,000. Additionally, they are being given comprehensive know-how support by the best Polish experts in the capital investments sector (e.g. representatives of venture capital funds and consulting companies). To date, three capital entries have been set up as part of the project, worth a total of PLN1.13 million, with some companies currently in the pre-incubation process. According to the plans, 15 capital entries will have been created by the end of 2012. An important component in the synergy between the University and the Multimedia

City project is locating the seat of the Computer Science Department of WSB-NLU in the Park. Th is will enable the University to teach practical skills to students, which could give the biggest competitive edge over other universities. For Multimedia City, this guarantees the availability of the most valuable intellectual potential – young students. Their open and unconventional thinking is a particularly cherished asset in developing hightech products and services. Another key factor leading to success is the network of links with partners and external experts. The Park’s partners already include Microsoft, Deloitte, PWC, Lewiatan Business Angels and Academic Business Incubators (AIP). In the coming years priority will be given to establishing networks of independent creators, innovators, and experts (students of Polish technical universities, and academics), and the Park’s task will be to commercialise their ideas, or to jointly develop products and services based on specific orders from entrepreneurs, i.e. in looking for new fields of activity, or developing their current products and services. Th is will all be made available by the Research and Implementation Centre to be jointly established within the Park by Miasteczko Multimedialne sp. z o.o. and WSB-NLU. The construction of the Multimedia City Technology Park presents another great opportunity for high-tech businesses to increase their dynamics of development and to promote their region globally. Thanks to the scenic, recreational, and tourist values of the Nowy Sącz area, and the business concept of the Park, a new quality will be created in the field of balancing professional and private life, providing innovative entrepreneurs with an attractive alternative to big cities. The current stage of project implementation opens wide avenues for the cooperation of investors and partners. The dynamic development of the ICT sector is determining the development of the Multimedia City Technology Park concept, which is responding to the needs of the market. Th is is the reason why the project is so interesting to investors who want to take advantage of its infrastructure in developing their products and services.

Contacts: Krzysztof Pawłowski – WSB-NLU Chancellor, President of the Supervisory Board, Multimedia City Technology Park, tel. 603 500 400 Krzysztof Wnęk – President of the Board, Project Manager of Multimedia City, Tel. 18 449 94 63 www.multimediacity.pl www.milionnastart.pl www.wsb-nlu.edu.pl

3/2011 :: polish market ::

Science and Innovation

Learning for business Innovative economy, higher education for a competitive economy, knowledge transfer, learning for business – these are slogans frequently used by politicians, the media and businesspeople. Professor, how do you see them from the point of view of the University? These words are undergoing devaluation. These slogans – although important – are repeated so often that they are slowly losing their meaning. They are becoming a figure of speech. Th is doesn’t change much, however, in the actual relations between the world of education and business. They are still separate worlds, looking at each other with reserve. Let’s take a wider look at the issues surrounding relations between science and the economy. Science can exist without cooperation with business. The greatest scientific discoveries in history, influencing our knowledge of the universe, the development of civilisation and culture did not care one bit about profit, only about an impartial passion for knowledge. The economy is different. Its growth is impossible without development in research. Although rewards flowing out of research frequently take a long time. In order for an innovation to pick up “steam”, in order for it to produce profits, several years are frequently needed. Work on a new medicine frequently takes even longer – ten odd years. Sometimes, fi nancial effects show up where they’re least expected. When the fi rst laser was built in the 60’s, the uses of focused light were imagined to be completely different. It was believed that thanks to this invention, the primarily development will be in holography – three-dimensional fi lms and shows were expected to appear. Th is did not happen. Holograms have their use in securing documents, but the strive for a three-dimensional picture is still not over. The Internet is a different example. It was created by nuclear particle physicists for their own use, and today it is a tool used by all people across the world.

46 ::

polish market :: 3/2011

Prof. Katarzyna Chałasińska-Macukow, Rector, University of Warsaw

University statistics 55,000 students 8,000 post-graduate students 3,000 university teachers, including almost 850 professors

The same is with quantum cryptography – work related to it may not be considered to be a priority at the moment from the point of view of the Polish economy, but who knows what the future will bring? Of course, it is sometimes the case that money invested in certain projects will never pay off. Investments in science are associated with a higher risk. Research does not always lead to an expected result. This is where certain restraint on the part of Polish businesspeople comes from, who tend to have very limited capital for investing in research. There is also a lack of appropriate legal solutions and support for businesspeople, which would encourage them. The chance, however, that the Polish economy will become innovative due to investment in research is not trifle. But this is mainly due to the European Union and the funding that flows from it.

Precisely, the University of Warsaw is investing a lot in the enlargement and modernisation of its education and research base. The institution has become a huge construction site in recent years. What investments are carried out at the moment and what is planned for the near future? Th is is a unique 5 minutes for a rector. The University is one of those institutions that best took advantage of the potential arising from Poland’s membership in the EU. It has received almost PLN 1 billion from the structural funds alone for the renovation of historic buildings, construction of new ones and for equipping laboratories. Th e most important construction zone is presently the university campus in Warsaw’s district Ochota. By 2013, three buildings will stand here: the Centre for New Technologies (CeNT) I and II and the Centre for Biological and Chemical Research,

Green solutions for a better future According to data published by the European Commission, home used energy makes up over one fourth (28%) of the total electricity consumption in Europe. Home appliances generate nearly 40% of costs appearing on energy bills of an average household. At the same time, fresh water, which may be made drinkable, constitutes less than 1% of the Earth water resources. Taking this data into consideration, it seems obvious that the future of home appliance industry lies in products which protect the limited natural resources of our planet. For many years, this type of production has been a priority for BSH Sprzęt Gospodarstwa Domowego Sp. z o.o., the leader of the Polish home appliance market, a subsidiary of the well-known BSH Bosch und Siemens Hausgeräte GmbH.

BSH branches pay much attention to sustainable development and environment protection. Since the beginning of 2010 the Bosch brand, the unquestionable number 1 in the field of home appliances, has been conducting a massive marketing campaign under the slogan “Green Technology Inside.” The most innovative household devices are the focus of this campaign. Definitely worth mentioning here are the ultra-modern dish-washers which, perked up with

innovative technological solutions, beat world records in regard to water and energy consumption. Siemens brand has also left its competition far behind, for example in washing machines and dryers sector. Siemens’ revolutionary clothes dryer with a heat pump uses by 50% less energy that other models in the A energy effectiveness class. The youngest child in the washing machines family - i-Dos model with automatic dosing system allows lowering the annual water usage by almost 7,000 litres! As nothing is more convincing to fi nal customers than economical reasons, the Bosch and Siemens marketing messages point out not only to the ecological advantages, but also present data on the possible savings ensured by the modern equipment. “We give the consumers an excellent basis for making a purchase decision,” says Konrad Pokutycki, president of the Management Board, CFO of BSH. “Instead of talking only about sustainable development, we also clearly show the savings brought about by a given device.” It is worth underlining that BSH spares no effort to protect natural resources not only through designing and improving its innovative technologies thanks to which the company’s home appliances are treated as benchmarks for the future of the entire industry. Making use of its brands, BSH takes active part in the creation of the consumers’ ecological awareness. It should be noted that

the company works closely with WWF. The organization’s programme “Protecting Grey Seals,” aimed at saving these animals and spreading knowledge about them, has been carried out together with the Bosch brand. The Siemens brand, on the other hand, is an oﬃcial partner of another WWF programme titled “Climate and Energy” under which the event called “Earth Hour,” promoting energy savings, is organized every year. The future of the home appliance industry is strictly related to technologically advanced products which, while improving the quality of our lives, take good care of our planet, its environment and resources. Therefore, BSH keeps conﬁ rming its leading position in the household devices market, always ahead of all the competitors with regard to innovative solutions, and never afraid of any challenges. ::

Science and Innovation which will host research that will create value for the economy. The CeNT I building will contain lecture halls and laboratories, used by under-grad, grad and PhD students in fields such as physics, biology, chemistry, biotechnology, computer science and environmental protection. The second CeNT building will be the headquarters of the Faculty of Physics, and the third will host over 130 laboratories, to be used by scientists from both the Chemistry and Biology faculties. Before the summer holidays, the construction of a building will begin that will be used by lecturers and students of the faculties of Modern Languages and Applied Linguistics. The selection of the general contractor is underway. The building will be right across from the University Library, right below the Vistula escarpment. Also during this year, the Czetwer tyńskiUruski Palace will regain its former glory, one of few palaces in Warsaw built along the development frontage of the street, where the Faculty of Geography is situated. The tender process is also underway for creating the concept for revitalisation of the Auditorium Building, neighbouring the palace. After the renovation, the building will be used by personnel and students of the largest university faculty – Journalism and Political Science. The faculty is getting ready to construct yet another building, at Bednarska Street, right beside the Vistula River. But the University’s buildings will not only be built in Warsaw. Recent news has reached our ear that the Świętokrzyskie Province government has granted a subsidy to the university for the construction of the European Centre for Geological Education in Chęciny. We want to build a similar centre in the Świętokrzyskie Province, to be used by archaeologists. Research at a high level is expected by international contracts. How is cooperation with foreign centres progressing? It is becoming more intensive every year. The University receives proposals to cooperate with educational institutions from across the world. We are presently working together with more than 1,200 foreign entities – including educational institutions from 52 countries, based on almost 200 contracts for direct cooperation. The University staff are winning numerous grants and take part in international research projects. More than 150 projects were subsidised last year from sixth or seventh Framework Programme of the European Union or other international organisations and foundations, including the European Molecular Biology Organisation, the European Cooperation in the Field of Scientific and Technical Research or the Trust for Civil Society in Central and Eastern Europe. The European Research Council (ERC) distinguished – as the only in Poland – 6 of our workers, awarding them ERC grants, regarded as the most prestigious research grants in Europe. ::

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We teach to think out of the box Professor Wiesław Banyś Ph.D., D.Sc., Rector of the University of Silesia in Katowice

The University of Silesia in Katowice is very active, not only in the academic ﬁeld, but also in areas of business and economics. How is this cooperation going? A modern academic institution, fulﬁ lling the standards of the 21st century, is one cooperating with wide circles of local authorities, industry and business. After all, universities are no longer the proverbial “ivory towers” - they have to keep up with changes occurring in the socio-economic sphere. The University of Silesia, being one of the largest and most dynamically developing Polish academic institutions, has established very good relations with the industrial sector. Among the numerous initiatives, it is worth mentioning the ones we have entered into recently: an agreement with the Upper Silesian Regional Development Agency (GARR), UPC Poland Sp. z o.o., the Inspector General for the Protection of Personal Data (GIODO), and the Regional Water Management Authority (RZGW) in Gliwice. Several months ago, the University of Silesia, the Silesian University of Technology, and the

University of Economics in Katowice signed an agreement with the Chamber of Commerce and Industry in Katowice, as a natural result of a change in the perception of the role of higher education institutions in general, and particularly in our region, as well as the eﬀective cooperation with entrepreneurs associated with the Chamber. Concluding the above-mentioned agreement was a great step forward, as it has created an opportunity to intensify and increase the number of academic studies focused on the economy and business, and the broadly-understood surrounding areas. Additionally, together with the other eight state-owned higher education schools from our region, we have established the Consortium of Silesian Public Universities. Directing our activities towards the consolidation of means and eﬀorts, combined with common initiatives, will enable us to achieve success in this increasingly competitive world. Our cooperation with the enterprise sector has also resulted in proposals for new university majors. And so, beginning from the next academic year, the University of Silesia will

Science and Innovation commence the implementation of a cluster of specialized programmes dedicated to interactive entertainment. Naturally, this initiative is not only aimed at introducing an attractive and profitable product to the educational market. Our main intention is to meet the needs of our partners from the business milieu - so far they could only collaborate with American and Japanese institutions in this respect. A common undertaking of this kind suits well the projections for the future and its main challenges, i.e. matching scientific and scholarly research with demand, as well as with the expectations of the broadly-understood University circles. We have already received fi rst signals confi rming that this idea is successful and attractive for the educational market. Hopefully, our programmes of study will be expanded and implemented not only by the academic teaching staff, but also by entrepreneurs, whereas the activities of the University of Silesia will substantially contribute to the practical implementation of the concepts and actions of a modern university, able to adequately respond to the challenges of new times.

Career Services’ activities focus on the situation of students and graduates on the Job market. They are to provide comprehensive support for the advancement of one’s professional career. Th anks to the dynamic activities of the Career Ser vice at our University we can meet the needs of students and graduates, and the regional and national job market. We are running integrated initiatives to strengthen contacts between young people and employers, in such forms as professional attachments, internships, meetings with employers’ representatives, job fairs, training courses - organised by specialists from the University’s Career Services, vocational counsellors and employers’ representatives. We also keep track of our graduates’ professional status, as well as employers’ expectations as to the future graduates of the University of Silesia. The long experience in building bridges spanning the academic world and the job market, combined with an original research programme on our graduates’ careers, provide us with answers to chief questions related to post-university work.

How would you assess the functioning of university Career Services?

At what stage of development is the Silesian laboratory now? In what kinds of

research is the largest Silesian University involved at present? Currently, the University is running around 1,500 different scientific research projects financed with external, European funds that we obtain in Ministry grants competitions, and from resources allocated for statutory activities and the so-called individual research fund, co-implemented with numerous external institutions both from Poland and from abroad, including business and other economic subjects. Many of them concentrate on innovation and practical solutions — in medicine, the economy, environmental protection and so on. These projects also contribute to the enlivening of the current agricultural scene, helping us learn about complex causes and preventing the consequences of climate change. They touch upon environmental issues and legal matters, influence education, serve to describe cultural transformations, and, fi nally, enhance the introduction of new industrial technologies. Innovative collaborative project coupled with scientific and scholarly research carried out at the University of Silesia prove that it is possible to seamlessly combine the concept of a humanist university with real economic and social needs of the country. ::

3/2011 :: polish market ::

Science and Innovation

The lack of competition mechanisms damages Polish universities and isolates them from the economic environment Tadeusz Pomianek, Andrzej Rozmus Effective and rational method of funding research and development (R&D) remains the priority of the most developed countries. Th is has one practical aim: bring science and economy closer together. Unfortunately, all available data is indicative of an extremely low level of cooperation between Polish science and economy. For instance, per one million inhabitants Poles registered in 2008 slightly over 75 patents whereas the Japanese and Germans did respectively 50-fold and 24-fold better. In 2005, Poland’s share in world high-tech exports (0.15%) was over 3-fold lower than the Czech Republic’s one (0.49%) and over 4-fold lower than that of Hungary (0.66%). At the same time, the high-tech share in the countries’ global volume of exports was as follows: Hungary – 22%, the EU average – 18%, the Czech Republic – 14%, Poland – 3%. Undisputedly, the number of successful grant applications, for example under the 7 Framework Programme, marked a defeat too. In the “Global Competitiveness Report 2009-2010” released by the World Economic Forum in autumn 2009, Poland is ranked 46th, behind i.a. Barbados, Puerto Rico and Malaysia. As far as innovation-related indices are concerned – namely that of the R&D cooperation between universities and industry – our country comes 76th!

Tadeusz Pomianek, PhD habilitated, Professor of Engineering, Rector of the University of Information Technology and Management in Rzeszów, President of the Association of Entrepreneurship Promotion in Rzeszów, President of the Polish Union of Private Employers in Education under the Polish Confederation of Private Employers “Lewiatan”, Member of the Coordination Group in the Centre for Analyses and Dialogue in Higher Education under the Foundation of the Polish Rectors in Warsaw. Andrzej Rozmus, PhD, Director of the Independent Unit of Research in Higher Education within the University of Information Technology and Management in Rzeszów, Member of the Experts’ Forum under the Ministry of Science and Higher Education, Secretary of the Centre for Analyses and Dialogue in Higher Education under the Foundation of the Polish Rectors in Warsaw.

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What are the reasons behind this? In the process of privatisation of major Polish companies little was done to provide them with a suitable framework for science and research. Today, international corporations mark off research segments to implant them in their respective foreign branches. Yet the main culprit of Poland’s backwardness as regards science and education remains the lack of competition. It is astonishing that over the last 20 years we have not managed to establish competition – which evidently fosters effectiveness and quality – in this crucial area for Poland’s development. The current funding system of higher education and science in general is a completely outdated relic of the past. With only a modest part (about 12%) of the science budget being distributed through open competitions, it is difficult to expect scientific institutions to thrive and multiply achievements. The current funding system of education (it applies especially to public education units) is devastating for Polish universities. Instead of prompting activity in the field of research and cooperation with business, all available resources are allocated to increase the number of students. According to the latest report by Ernst & Young entitled “Scientific productivity of the higher education public institutions in Poland,” as much as 87% of Polish universities’ revenues come from teaching services. For the majority of them, the percentage is even higher and oscillates around 92%-96%. In the case of technology universities, it is a bit lower and amounts to about 80%. In renowned non-public institutions, the index ranges from 60% to 90%, while in most of schools it clearly exceeds 90%. Finally, available data indicates that universities’ revenues,

apart from subsidies and teaching incomes, attain an average of 4%. If you add to this that subsidies for full-time day courses are directly proportional to the number of students, and that non-public institutions do not receive them (the amendment to the existing law does not provide for any substantial changes), it appears that the current funding system is nothing but a recipe for even-worse educated graduates. It is somewhat of an incentive to waste public resources and plunge into mediocrity. Poland desperately needs to bring together distinguished academicians in good research centres as well as to ensure a clear repartition of roles. Instead of racing with each other to educate the biggest number of students in the shortest time, universities which have the strongest leverage should focus on scientific and research activities, cooperation with business environment and perfecting their teaching programme within the second and third-degree studies. Obviously, these institutions should be offered a quality-oriented, pro-innovation and more generous funding system. By contrast, universities with lesser – yet sufficient from the teaching point view – potential should concentrate on the fi rst-degree studies. Funding system based on competition would enhance the spirit of competition, while a clear repartition of roles will ensure quality and diversification. The legal status – private or public – of the university is not an issue here; the most important is that the money goes to the one which performs better both in terms of research and teaching. It is indispensable, if we want higher schools to stimulate the process of building a modern and innovative economy. ::

Science and Innovation

Private universities oﬀering PhD programmes Name of the school

Location

Type of the school

Academy of Finance

Warsaw

school of economics Prof. Mirosław Zdanowski, PhD, DSc 1991

Academy of Humanities and Economics in Łódź

Łódź

Academy of Law and Diplomacy

Gdynia

Academy of Management in Łódź

Łódź

Andrzej Frycz Modrzewski Kraków University

Kraków

Collegium Civitas

Warsaw

university

Helena Chodkowska School of Management and Law

Warsaw

Higher School of Finance and Management in Warsaw (WSFiZ)

Rector of the school

Founded Subjects of PhD degree in studies Economics, Management

Prof. Andrzej Denys, MD, PhD

1993

Fine Arts – Graphic Arts, Linguistics, Computer Science

economics

Prof. Wojciech Lamentowicz, PhD

1996

Political Science, Law

economics

Prof. Roman Patora, PhD

1994

Management

Prof. Jerzy Malec, PhD

2000

Law, Political Science

Prof. Edmund Wnuk-Lipiński, PhD

1997

Sociology

school of economics Piotr Mochnaczewski, PhD

1992

Management (International doctoral studies)

Warsaw

school of economics Prof. Maria Sierpińska, PhD

2001

Economics, Psychology

Katowice School of Economics (KSE)

Katowice – Piotrowice

economics

1991

Management

Kozminski University

Warsaw

school of economics Prof. Andrzej K. Koźmiński, PhD

1993

Management

Łazarski University

Warsaw

Prof. Daria Nałęcz, PhD

1993

Law

Łódź Academy of International Studies (LAIS)

Łódź

university

Prof. Marian Wilk, PhD

1997

Political Science

Papal Theological Faculty in Warsaw/ PWTW

Warsaw

theological school

Rev. Prof. Zbigniew Kubacki, PhD

1988

Theology

Polish-Japanese Institute of Information Technology

Warsaw

school of technology Jerzy Paweł Nowacki, PhD

1994

Computer Science

Pultusk Academy of Humanities

Pułtusk

university

Prof. Adam Waldemar Koseski, PhD 1994

History, Political Science

School of Humanities and Journalism in Poznań

Poznań

university

Prof. Karol Olejnik, PhD

1996

History, Political Science

Silesian School of Economics and Foreign Languages

Katowice

Prof. Andrzej Limański, PhD

1994

Linguistics

Skarbek University (studies organised together with the Institute of Economics at the Polish Academy of Sciences)

Warsaw

university

Prof. Michał Kelles-Krauz, PhD

1995

Economics

University of Lower Silesia

Wrocław

university

Prof. Robert Kwaśnica, PhD

1997

Education, Science of Cognition and Social Communication

Warsaw School of Social Sciences and Humanities (SWPS)

Warsaw, branches in Wrocław, Sopot, Poznań, Katowice

school of education

Prof. Andrzej Eliasz, PhD

1996

Cultural Science, Psychology, Sociology

Prof. Krzysztof Szaﬂarski, PhD

3/2011 :: polish market ::

Science and Innovation

Business and innovation Prof. Alojzy Z. Nowak, Ph.D., Dean of the School of Management at the University of Warsaw

Innovation - understood as an improvement, innovativeness or introduction of something new - may be of great importance in business. Such activities are associated with an increase in competitiveness and modernity. As a result, business activity of both the producer and buyer may increase – of the producer as it consists of a growth in production and the sales of products and services; and of the buyer as they are interested in the purchase of modern - and at the same time often also cheaper - goods, and is the result of enhanced creativity directed at, i.a., lowering manufacturing costs. It is worth noting that innovation may also relate not only to the quality of manufacturing but also to the marketing of products, and the marketing and improvement of work organisation and management.

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These are all actions which, on the one hand increase the eﬀectiveness of management on the domestic market and, on the other hand, win recognition on the international market. Therefore, they should be supported and promoted from the early years of education. Th is can be done by creating and developing the interests of pupils, students, and all those who have a so-called restless soul. Therefore, an important tool for promoting interest in innovation are the resources allocated to education. However, a perhaps no less important instrument is the creation of an attitude of willingness to risk and take unusual, and often risky and untested, actions and initiatives. Th is requires a critical approach both to obvious truths and to all kinds of stereotypes and concepts

generally recognised as the only possible ones. An innovative entity should have a cognitive curiosity and a critical look on reality and the intention to change it.

Necessary measures to promote entrepreneurship among Poles Entrepreneurship is usually understood as a process of creating (building) something new – most often a company. The basic characteristics of entrepreneurship are dynamism, activity, an ability to adapt to changing conditions, an ability to perceive opportunities and their use, and a propensity for risk. If we analyse the behaviour of Poles, many of them have features that characterise entrepreneurship and entrepreneurs. Th is applies, in particular, to the ability to seize opportunities, identify needs, and improve ideas (“a Pole can do it”). According to researches and many observations, these features allow many Poles to make successful careers, both at home

Science and Innovation

and abroad, including establishing their own businesses. Of course, this is not true for all, and perhaps on an insufficient scale. Hence, the question “what should be done to promote the entrepreneurship of Poles?” seems to be justified. It seems to me that, as in the case of promotion of innovation, an essential issue is education resulting in most young people not having an aversion to risk when making decisions about establishing their own businesses. Th is can be done by universities, schools, but also the mass media, which, on the one hand, should encourage the establishment of own businesses but should also explain that a business does not necessarily have to be successful fi rst time. Therefore, one should be consistent and patient in ones actions and prepared for failures. Moreover, the central government and local governments, which should support both entrepreneurship and entrepreneurs, have a major role to play. They can do so both by providing loan guarantees, and through friendly legal and administrative regulations, which, on the one hand, should facilitate establishing companies and, on the other hand, closing and re-establishing the same or different ones. As it is known, in some countries with a high level of entrepreneurship, a company collapses in the morning, only to re-establish itself a few days later, in extreme cases, even on the same day - sometimes under a different name, but sometimes even under the old one. In many countries which are economically successful entrepreneurship and entrepreneurs are the pride of seminars, conferences, social meetings, political and economic events. It is worth explaining to young people - candidates for entrepreneurs - that ideas, dreams, and persistence are the most important values in business. If they have them, they will surely acquire the money to achieve their goals. The government should, however, be aware that entrepreneurship and entrepreneurs are the most important sector, because they create jobs, produce

goods, supply local and central budgets and determine the welfare of society and the position of the country on the international arena. And that is why they should be supported by all possible means.

Cooperation between the worlds of science and business – its benefits and positive impact on development Recently, both scientific and business circles have expressed a great need for cooperation. It may even be said that both fields cannot imagine functioning without each other. Obviously, this varies across different fields and industries. Even though this cooperation is not yet prevalent in Poland, it is more and more commonly accepted, and in many fields there are already cases of strong synergy between science and broadly-understood business. Th is relationship is, on the one hand, the need of a moment, and on the other, a well-thought-out strategy, based on observing those countries which derive actual gains from such cooperation, as well as on the need for growth in scientific research and science at large. Barring few exceptions, science can make a great contribution to business, and business can offer a lot to science. In the first case, these are mostly cutting-edge solutions, innovation, new technologies, new products, etc. Science can help

gain a competitive edge and increase the efficiency of managing a business. Business, in turn, can give science an opportunity to put ideas into practice, to verify them critically, and ensure that practical aspects are taken into account to a greater extent in research. It also provides chances to obtain co-fi nancing, which is particularly important during the fiscal crisis in many countries, and for other reasons. Also the society, who fi nances many research institutes, is given the feeling that these funds are allocated well, e.g. by implementing research results in industry. When emphasising the positive results of cooperation between science and business, it should be remembered that not all research results can be immediately put into practice. Sometimes they are well ahead of practical solutions, taking years before they can be implemented. The objective of science is also the search for the truth. Reaching it often requires many generations of scientists, and many years of research. State institutions fi nancing scientific research and business should be well aware of this fact. Th is situation requires a certain degree of one-sided cooperation of business with science, by fi nancing it through various foundations. Examples of this kind of activity are plenty and popular – especially in the USA, but also in other countries. I hope that soon it will be the same in Poland. :: 3/2011 :: polish market ::

Science and Innovation

WCAT and its mission The project “Wielkopolska Centre of Advanced Technologies (WCAT)”, realized by the University of Adam Mickiewicz in Poznań on its modern Morasko campus, is one of the biggest infrastructural and technological ventures in the region. The Centre is currently under construction, and its network of world-class laboratories is located in 4 main buildings: (Medical Biotechnology (A) with Animal House (A2), Industrial Biotechnology (A) with a Greenhouse (A1), Chemical Technology and Nanotechnology (B), Materials Science with Regional Laboratory of Unique Equipment (C).

The Centre is a consortium established by: 5 State Universities (Adam Mickiewicz University in Poznań, Poznań University of Technology, University of Life Sciences, University of Medical Sciences, University of Economics); 4 Institutes of the Polish Academy of Sciences (Bioorganic Chemistry, Plant Genetics, Human Genetics, Molecular Physics); Institute of Natural Fibres and Medicinal Plants; Poznań Science and Technology Park of Adam Mickiewicz University Foundation and the City of Poznań. According to project director Professor Bogdan Marciniec, the main aim of the WCAT is to create a multidisciplinary research centre of international activity and impact in the ﬁeld of hightech materials, biomaterials and nanomaterials based on recent achievements in related ﬁelds of chemistry, chemical technologies, physics, biotechnology,

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biology, medicine, pharmacy and agriculture sciences. The vision of the Centre is to include existing organizations such as: universities, research institutes, technology parks, to act as one independent entity by combining together the work of the best focused on innovative research, advanced technologies and commercialization. The Centre focuses on interdisciplinary research in the fields of chemistry, physics, molecular biology, materials engineering and biotechnology. This combined effort brings technologies of production of new materials (nanomaterials, biomaterials) for optoelectronics, nanoelectronics, ceramics, pharmacy and a wide number of other fields. The special mission of WCAT is to develop multidisciplinary projects involving fundamental research in the material sciences but simultaneously leading to advanced technologies and/

or products, subsequently implemented in incubators of the innovative ﬁrms located in Poznań Science and Technology Park, other industrial and technological parks and innovative small and medium enterprises as well as by pan-European industry. The Centre was recently accepted for the Polish National Roadmap for Research Infrastructures (under the auspices of the European Strategy Forum on Research Infrastructures (ESFRI)) as the only institution from the region focused on development of technologies and new materials. The total investment cost of the project is 63 M Euro (including the 15% contribution from the national budget). The construction of the WCAT infrastructure facilities started in the fall of 2010 and the operational phase of the research centre is scheduled to begin in January 2014. ::

Science and Innovation

Mazowiecka Spółka Gazownictwa – training gas technicians Mazowiecka Spółka Gazownictwa has extended patronage over a Gas Technology School in Łódź belonging to the city’s No. 3 Secondary School Complex. The company helps with the school programme and organizes practical classes which are of great use to the students, whose theoretical knowledge is thus submitted to practical testing. Gaz Industry Museum in Paczków

The close of March 2011 saw the conclusion of a project entitled “Complex Professional Skill Improvement Programme for Students of the Sanitary Equipment School at No. 3 Secondary School Complex in Łódź in Partnership with the Mazowiecka Spółka Gazownictwa.” The programme was fully ﬁ nanced under the European Social Fund’s Operational Programme Human Capital 2007-2013 and consisted of extracurricular classes for 150 students specializing in gas and sanitary technology. Its main objectives were: :: the foundation of a Gas Technician’s and Mechanic’s Library offering specialist books and periodicals; :: the organization of specialist courses (polyethylene

welding, electric welding, electric power engineering); the purchase of attested protective clothing for project participants; the organization of workshop classes in “soft” skills required by today’s employers; the organization of study tours in gas industry facilities for students and teachers; enabling the participation of students and teachers in gas industry fairs; the organization of a scientific seminar for gas technology teachers and teachers in other ﬁelds.

Mazowiecka Spółka Gazownictwa was the project leader, answering for its realization and ﬁnancial clearance with local

Electric welding class

authorities. MSG’s main partner on the undertaking was No. 3 Secondary School Complex in Łódź, responsible for the execution of individual project tasks. Th e main job entailed the startup of courses in electric and polyethylene welding and electric power engineering. Course participants dealt with specialized areas like steel and electrode types, the construction of welding equipment and pipeline construction technology. Other important areas were work hazards and work safety. The project’s workshop scheme was designed to provide students with the professional leverage needed on today’s market. The workshop programme covered key areas like navigating the labour market, crucial skills, teamwork, and others. One of the more attractive sides of the project were study tours, during which students visited gas industry facilities and infrastructure and were acquainted with the branch’s history and traditions. Mentions worthy among the visited facilities are the Gas Industry Museum in Paczków, the Gas Industry Museum at the Polskie Górnictwo Naftowe i Gazownictwo (PGNiG) in Warsaw and the PGNiG premises, and the Ignacy Łukasiewicz

Facilities in Bóbrka

Oil and Gas Industry Museum in Bóbrka. During their visit in Warsaw the project participants met officials from the Chamber of the Natural Gas Industry affi liating Poland’s gas companies, who described how gas companies cooperated within the chamber, especially in areas like technical standardization and legislation. Also discussed was the chamber’s role in contacts with government agencies, foreign branch partners and scientific and branch organizations in Poland and abroad. Updated information on the project and data necessary for its participants were available at No. 3 Secondary School Complex website www.zsp3.com/projekt. Emilia Tomalska Mazowiecka Spółka Gazownictwa 3/2011 :: polish market ::

Science and Innovation

Open for cooperation Interview with Rector of the Silesian University of Technology Professor Andrzej Karbownik PhD, DSc (Eng)

Professor, the vision of the “ideal” engineer is constantly changing. How does the Silesian University of Technology participate in the creation of engineering staff for Polish industry? Indeed, the word “engineer” meant something different twenty years ago, and it means something different today. However, it has always been associated with a high level of education and with the education of professionals who knew their roles and responsibilities. And this hasn’t changed. The Silesian University of Technology has already been involved in this educational process for 66 years. Currently, we educate future engineers in all possible fields. Th is education is now focussed on preparing our graduates to perform management functions. And this brings results. Rankings monitoring graduates’ careers place the Silesian University of Technology at the top of the universities in Poland. According to one of the rankings, one in 12 presidents of a large company in Poland is a graduate of the Silesian University of Technology. Therefore, it can be safely concluded that a degree from our university is a ticket to a career. How does the university prepare students to enter the labour market? In addition to the education of students at the highest level – which is our duty – we

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stimulate our students to develop their own initiatives. The most important aspect of this is to provide young people with specific support in the form of reliable knowledge about starting and running one’s own business activity. Recently, we initiated a raft of actions to promote academic entrepreneurship. With a view to ensuring close cooperation with industry, the Centre for Innovation and Technology Transfer of the Silesian University of Technology and the Academic Entrepreneurship Incubator have been established. Moreover, one of the oldest Student Career Offices in Poland operates at the Silesian University of Technology. Every year we organise a contest “My idea for a business.” During every edition, students develop not only technological ideas, but also business plans for putting them into production. The best “ideas” – thanks to cooperation with enterprises – are rewarded with cash and implemented in the industry. Owing to this a few promising companies have been already established. In what other ways does the university – located in such a heavily industrial region – cooperate with companies? Economic growth in the contemporary world largely depends on implemented innovation and cooperation between science and business. Currently, a strong economy is an innovative economy. We are aware of this, which is why, we are so committed to promoting the idea of academic entrepreneurship and innovation among our students, doctoral students and staff. We strongly emphasise close cooperation with industry. Th is cooperation is carried out in three areas – research, education and human resources. Each of these areas is clearly described in the agreements with companies, which we have signed a great many. Thanks to these agreements our students can learn about the latest technological solutions used in industrial plants. For companies, however, it’s a great opportunity to fi nd the students whom they may offer jobs in the future. The university conducts series of training sessions for corporations, prepares expert opinions,

www.polsl.pl conducts analyses and prepares opinions on technology, organisation and management, and agrees, in cooperation with companies, students’ theses in line with the needs of these companies. It is also important to create opportunities for meetings with representatives of the scientiﬁc and business community, which we do by organising Days of Science and Industry, the Employer and Entrepreneurship Exchange and Entrepreneurship Week. Are the curricula changing in connection with the expectations of companies? Of course! The Silesian University of Technology has been constantly developing. We are opening new programmes of study tailored to the needs of employers. The process of teaching in technical studies must be inherently linked closely with industry. Therefore, in order to best prepare our students for a professional start, we cooperate closely with many companies representing various industries. For example, as part of the work of the Social Council of the Silesian University of Technology, together with experts from various companies, we analyse and modify curricula for speciﬁc courses in detail. It is also a great example of our cooperation with companies. ::

Law & Taxes

Study facilities and support for foreigners in Poland Maja Sujkowska Foreigners are welcome to undertake and pursue studies in Poland as well as to go in for other forms of education. They are also welcome to participate in R&D projects. The appropriate rules and regulations are laid down in the “Law on Higher Education” of 27 July 2005 and the relevant enforcement provisions. Accordingly, foreigners may take up bachelor’s and master’s degree studies, postgraduate and doctoral studies, postdoctoral, scientific, artistic and specialist training, postgraduate medical internships, education courses (including one-year courses preparing non-nationals to start education in Polish) as well as vocational training courses for students. Foreigners have the option of taking up full-time studies (from Monday to Friday) or studying part-time (during weekends). The Polish law defi nes the terms of covering the cost of foreigners’ education in Polish institutions from public funds. Matters concerned with organizing, recruiting and qualifying foreigners for studies and training in Poland are dealt with by the Bureau for Academic Recognition and International Exchange. The running of the State Commission for the Certification of Proficiency in Polish as a Foreign Language is part of the Bureau’s responsibilities. Foreigners planning to participate in training schemes as well as in scientific research and development work have to meet certain conditions. For one, they need to have a visa, a residence card or other documents justifying their stay in Poland. Secondly, they have to have a good health record documented by a medical certificate. Moreover, they have to take a health and accident insurance policy for the entire duration of their education in Poland or acquire a European Health Insurance Card (EHIC) failing which they must sign an insurance agreement with the Polish National Health Fund (NFZ) once they start studying in Poland.

Chairperson General Partner’s Board at European Center for Legal Consultations

To begin studying in Poland, foreigners have to prove proficiency in Polish appropriate to the level of studies they intend to undertake. Foreigners may be accepted to studies conducted in Polish provided they have completed a one-year preparatory course for such studies (courses are run by several institutions in the country) or have received a certificate confi rming their knowledge of Polish issued by the State Commission for the Certification of Proficiency in Polish as a Foreign Language or else have acquired confi rmation from the university they intend to study at that their knowledge of Polish is sufficient to take up studies in that language. While taking the one-year course, foreigners have during that time the same rights (among others to receive scholarships and enjoy various discounts) as those studying at a university. Under Polish law, foreigners can be accepted for studies and training bypassing recruitment rules applicable to Polish citizens provided they have a diploma (authenticated or apostilled) recognized as equivalent to Polish documents (such as GCSE, certificate of completing bachelor’s and master’s degree studies). Foreign diplomas and degrees are validated in Poland by the Department of International Programmes and Recognition of Diplomas at the Ministry of Science and Higher Education. Moreover, candidates from abroad have to be predisposed to take up studies at universities where special predispositions are required (for example physical fitness in universities of physical education). Foreigners who have been qualified for studying in Poland, training or pursue R&D work in public institutions may apply for the status of a “scholarship holder.” Scholarship holders are exempt from paying the tuition fee and apart from that receive a monthly grant (currently amounting

to between EUR650 for students and EUR2,340 for PhDs or those employed in a foreign university as a professor). Scholarships are granted on a monthly basis during the respective years of studies. Short-term scholarships (for up to 15 days of stay) can also be granted. Foreigners may also apply for a one-off relocation allowance during the fi rst year of studies, a hardship benefit as well as an allowance for preparing a diploma or doctoral thesis. Applicants seeking such allowances and benefits shall submit their applications to the Bureau for Academic Recognition and International Exchange, or directly to the respective ministries responsible for the appropriate government departments which refund scholarships paid out by educational units from public funds. These applications should be sent through Polish Embassies or consulates, diplomatic missions accredited in Poland or foreign institutions authorised to deal with these matters. In some cases a scholarship may be refused (i.e. when the applicant has not obtained the right of residence in Poland), suspended (i.e. for failing to pass exams on time) and withdrawn (i.e. when the applicant is sentenced by court for committing intentional offence). Additional grants, prize money and bonuses can be paid out by respective universities from their own funds and under their own rules to the best students in recognition of distinguished performance in studies. Individuals, who do not meet the criteria qualifying to receive a scholarship, may study in Poland at their own cost. The tuition fee for foreigners taking up studies or training in Poland, participating in R&D work in public universities for a fee or taking up studies conducted in a foreign language amounts to an equivalent of EUR2,000 to EUR3,000. In science institutes run by the Polish Academy of Sciences, R&D and organizational units with an R&D status as well as those run by the Polish Academy of Learning the fee depends on the respective form of education. :: 3/2011 :: polish market ::

Law & Taxes

Sometimes you do not have to do anything to bind yourself by a trade contract B2B relations are treated differently from B2C relations and other transactions. Certain provisions of the Polish Civil Code promote the efficiency and speed of trade rather than its security and clarity. In some circumstances an entrepreneur does not have to respond to the offer to bind himself by a trade contract. Therefore, it is crucial to be aware of these circumstances. Otherwise, someday the entrepreneur would find himself obligated to fulfill the obligations under a contract, which he would never suppose to be binding.

Tomasz Grzegorzewski, the attorney at law at Chałas & Partners Law Firm, Gdańsk Branch

58 ::

A typical way of concluding agreements is to conduct some negotiations and then to sign a contract (in some cases a validity of a contract depends on its specific form – e.g. a contract, under which an immovable property shall be transferred, should be concluded in the form of a notarial deed). Although most recommended, a written form of the contract is not always required by the law. In many cases an oral form would be sufficient. In particular, contracts of specific works, mandate or sale of movables can be lawfully concluded without keeping a written form. Hence, if both parties agree on the substantive provisions (and any other provisions proposed by one of them) - e.g. of a sales contract - the agreement is considered to be concluded. There are no obstructions to express one’s statement in the implied form (a nod of approval or shaking hands). Not only in B2B relations certain doubts may arise from the agreed terms of a non-written contract. After all human memory is always good, but often short. Nevertheless, oral agreements are practised widely, especially between solid business partners. In wellestablished business relations, the implied form of conducting agreements often will be completely sufficient for

polish market :: 3/2011

the parties as an accomplishment of their commercial negotiations. Polish civil law provides even more extensive forms of facilitating conclusion of agreements, especially in the above mentioned B2B relations. In fact, sometimes an entrepreneur does not have to express any statement (even in the implied form) to bind himself by the contract. If a given entrepreneur received from a person with whom he is in permanent business relations, an offer to conclude a contract within the scope of his activity, a lack of an immediate reply shall be considered as the acceptance of the offer (art. 682 of the Polish Civil Code). Th is regulation provides an institution supporting conducting of ongoing cooperation. The parties do not have to express their will to sign a subsequent contract again and again. The offeree is assured that he can immediately proceed to implement the contract and the tenderer can expect the contract to be binding and executed by the other party. However, some risks may be involved also. Firstly, it is hard to defi ne whether business relations between given entrepreneurs are permanent. There is no doubt that the fi rst and the second deal concluded between the given parties does not make these relations long-termed. The

third one, especially when it concerns the same batch of goods, may be considered concluded within such permanent relations. Another question are the intervals between the offers, so the later one may be considered as the offer within those permanent relations. Hence, in some cases an embarrassing misunderstanding may occur when one party expects the contract to be binding as no immediate response was received and the other party claims that there is no permanent business relation between them, so no contract was concluded. Those misunderstandings may result in significant damages, e.g. when the tenderer should fulfill his own obligations in a specific period of time and he desperately seeks for a subcontractor. If a potential subcontractor remains silent and does not proceed to carry out the agreement (because in his opinion agreement is not binding), the tenderer may suffer damages as he failed to meet his own deadlines. On the other hand, a silent offeree bears the risk of responsibility for breaching the contract if it turns out that the lack of his immediate response result in the effectiveness of the agreement but it remained nonperformed. Similar examples could be multiplied indefi nitely. Is there any particular way to prevent from these damaging situations? The easiest way for the offeree to avoid these risks is an immediate response to the offer, either positive or negative. On the other hand, in case of any doubts the tenderer can always call the offeree to make a statement responding to the offer, just to make sure the parties understand each other. If the existing cooperation is permanent (e.g. previous contracts have been conducted this way already) the risks are obviously minimal, provided that the offeree is aware of the meaning of his silence. w w w.chwp.pl

Finance

A bank created after the crisis “We will be a bank that’s really concerned about our clients’ interests. Some banks took advantage of the slightest pretext during the last crisis to call on loans. This will certainly not be our style. We are not a chain bank, belonging to a large, international financial group and, for this reason, we are able to offer something different – predictability, flexibility and speed in decision making,” says Maciej Stańczuk, President of Polski Bank Przedsiębiorczości (PBP Bank S.A.)

debt. Local governments, however, need solutions that will not enlarge their budgetary obligations, which is what made PPP possible prior to December 2010.

The Polski Bank Przedsiębiorczości SA, formerly WestLB, bets on medium enterprises and projects in the public sector. There is a lot of talk at the present about publicprivate partnership. Could you tell us something about this element of the bank’s strategy? We are trying to build long-term relationships with our clients. We serve both corporations and local governments, we are specialists in ﬁ nancing investment projects, being implemented both by enterprises and local government units. Public-private partnership (PPP) projects, extremely popular in Great Britain and Germany due to their eﬀectiveness, are not commonplace here. In addition, the Minister of Finance, in last December’s decree, discouraged local governments from PPP by ordering them to account for all liabilities from this type of agreements as budgetary obligations, hence as part of their

The PBP Bank intends to support infrastructure projects and those related to the energy sector. Do you intend to participate in the process of modernising Poland? We have specialised in financing innovative projects in the area of energy and infrastructure for many years. We are good at it. We changed our strategy following the change in ownerships (55% of the bank’s stock is owned by Abris Capital Partners, 45% by IDM brokerage). The size of our capital does not allow us to assume the role of organiser for financing large projects. We do intend, however, to participate as part of a consortium. These types of transactions will not be the main aim of our activity. Medium enterprises are the bank’s strategic clients. What could encourage them to choose PBP Bank? Predictability in the bank’s activity, flexibility and speed in decision making. We are not planning on building a factory for lending money, we are going to win clients with the quality of our services. We ensure that a client will receive a full response within 1014 days regarding a loan application or whether we are able to prepare a different, more complicated form of financing, or accept the risk associated with a given transaction. We will focus on the Polish market, although we

intend to accompany our clients in foreign expansion. If a company wants to grow, enter new markets, then we are ready to support such projects, not only through fi nancing, but also through our expertise and experience. We are trying to create a stable bank, which assesses risk conservatively, but at the same time is flexible and innovative. How do you assess the present credit policy of Polish banks? Banks are liberalising their credit policies, it is clear that they are hungry for new, good assets. Th is liberalisation is supported by the fact that we have more information about regulation in the banking sector (the Basel Committee has prepared new regulations for the banks). The majority of Polish banks are part of foreign groups which, knowing what regulations will be enforced in the future, are able to make decisions today on the direction of development for their subsidiaries, including those in Poland. Th is is very good news for Poland since it means that the banking sector will support economic growth in the coming years. Competition among the banks will grow, which will be favourable for clients. We are not afraid of stronger competition because we are convinced that there will still be a niche for our institution, fi nancing good, Polish enterprises. Besides that, experts who know the market very well and know the needs of business work for the bank. :: Interview: Sandra Wierzbicka 3/2011 :: polish market ::

Finance

Good things come in small packages Cooperative banks have been present in Poland for 150 years. However, never until the years of the recent global crisis, has the signiﬁcance of this sector in maintaining the stability of the Polish ﬁnancial system been recognised. Experts gathered at a conference organised by the National Bank of Poland and the National Association of Cooperative Banks summarised the activity of this sector in the previous year and discussed the plans for this year.

Małgorzata Zaleska, Member of the Management Board of the National Bank of Poland A summary of the cooperative banking sector in 2010 Th roughout 2010 the cooperative banking sector remained stable and the funds deposited in it were safe. What’s more, the sector increased its proﬁts by some 10%. Cooperative banks also increased their role as creditors, especially in the small and mid-sized business (SME) sector. In the BPS Group (Bank Polskiej Spółdzielczości) SME loans already constitute 27% of the entire customer portfolio. Th is may have resulted from the fact that commercial banks, responding to the crisis, opted for stricter loan requirements, and cooperative banks took over this function. Th is is extremely important, as loans to businesses are a driving force behind our economy. The ratio of non-performing loans was better in the cooperative banking sector than in the commercial banking sector, but cooperative banks also incurred the costs of the loan portfolio deterioration in the recent period. Deposits from households experienced a greater increase in cooperative banks than in commercial banks. At the same time, cooperative banks created more new jobs when developing their establishments.

Growth prospects To a signiﬁcant extent, growth prospects are connected to changes in supervisory regulations. For example, Basel III will also cover the cooperative banking sector, regulating the amount of in-house funds, the amount of leverage ratio, and liquidity standards. However, their impact on banks should be considered individually. Cooperative banks should aim at taking full advantage of their own potential. The greatest advantage of this sector is the knowledge it has about its own local environment.

60 ::

polish market :: 3/2011

The sector should take the opportunity to open itself to new groups of clients, for example young people. The reinforcement of electronic banking services presents another challenge facing the sector. Research shows that whereas some 30% of commercial banking clients use electronic banking, this ﬁgure amounts to 11% in the case of cooperative banks. Tightening cooperation in associations may also be considered an important element.

The consolidation of the cooperative banking sector – opportunities and threats It is still an open question whether the cooperative banking sector should be subject to the further consolidation that has been taking place in various aspects and with different intensity for years, or whether the present condition and structure will be satisfactory in the nearest perspective. Surely, the next stage of sector consolidation may help in conducting more uniform marketing and promotional campaigns. It can create opportunities to provide even more standardised products, not only in the field of banking itself but also in investment funds and insurance markets. Th is process may also entail a reduction in fi xed costs, not only directly connected with running banking activity, but also those incurred for training and IT. It is also a chance to better procure funds from the market, including the international one, and by way of the issue of securities. However, the further consolidation of associations entails certain threats. For the cooperative banking system it would mean drifting away from the local level, which could pose the risk of viewing various matters from the more central perspective. It may cause to identify with the association to a lesser degree and to have concerns for the possibility of losing influence on the decision-making process and its efficiency. Shareholders can also fear being deprived of control over associating banks.

Sebastian Skuza, Deputy Director of the Financial Market Development Department in the Ministry of Finance Legislative changes in the cooperative banking sector Poland avoided a crisis, which is especially true of the cooperative banking sector that was a link maintaining in 2009 the lending process in the country. In 2010 the surplus of deposits over credits was considerable and cooperative banks made a good use of it. At the beginning of this year, the Act on providing assistance by the State Treasury to fi nancial institutions, and the Act on recapitalisation, were renewed. Another measure that came into effect was the strengthening of the role of Bank Gospodarstwa Krajowego (BGK). On 5 January the Act amending the Act on BGK was adopted, pursuant to which the bank was strengthened by being granted a State Treasury guarantee of liquidity and it was stated that in the event of its liquidation BGK’s liabilities will be absorbed by the State Treasury. Th is is extremely significant, as it may allow BGK to be awarded a rating at the level of the State Treasury. I believe that the cooperation of cooperative banks with BGK should constitute one of the main elements in their development. Within this cooperation cooperative banks should also take advantage of their experience, knowledge of local markets and customers to increase their role in the small and mediumsized enterprise sector by participating in the programme of guarantees and sureties for small and medium-sized enterprises revived by the government. The amendment to the Act on cooperative banks of 2009 regarding the possibility to issue bonds was of utmost importance. Owing to the activity of cooperative banks on the capital market, the market for Catalyst platform bonds has developed. As for further legislative changes in the cooperative banking sector, the Ministry of Finance is currently analysing issues reported by cooperative banks in relation to bank secrecy and inspections. Pursuant to the law on cooperatives, inspections are obligatory. It is a matter of naming the inspector in the institution’s catalogue, which the Ministry of Finance is in favour of. However, the problem of abolishing the territorial range of this activity is more problematic as this could negatively impact on the rate of wrongly-awarded loans.

Finance Krzysztof Markowski, President of the Credit Information Bureau (BIK) Information on customers is the key to the development of cooperative banks Cooperative banks are institutions that for the last few years have been actively participating in the system of data exchange organised by BIK. At the end of the previous year, 524 cooperative banks had contracts concluded

with us, of which 274 provided data inputs. Having compared this ﬁgure with the situation a year earlier, we can see considerable progress and a greater contribution by the cooperative banking sector in data exchange. Cooperative banks are very active users of information on their customers. They downloaded almost half a million reports in 2010 and nearly 300,000 in 2009. This shows that the cooperative banking sector appreciates information as a fundamental factor in risk management.

At the end of 2010 we have at our disposal information on almost 1 million cooperative banks’ customers holding 1,700,000 accounts. Only 39 cooperative banks do not cooperate with us. Interesting conclusions can be drawn from comparing the customer loyalty rate with the share of bad customers, i.e. those having trouble with debt servicing at least in one bank in which they hold an account. In cooperative banks themselves their share is about 9%. However there are 5% of customers who conscientiously

Total assests (value in thousands of PLN)

Employment

Net proﬁt/loss (value in thousands of PLN)

Zbigniew Bodzioch

126252

105089

21163

11802

8647

1796173

609

2 Podkarpacki Bank Spółdzielczy in Sanok

Lesław Wojtas

119432

100658

18774

15663

12087

1749223

599

3 Spółdzielczy Bank Rzemiosła i Rolnictwa in Wołomin Jan Bajno

51046

44789

6257

5802

4744

720935

201

4 Gospodarczy Bank Spółdzielczy in Barlinek

Zbigniew Wielgosz

50379

42099

8280

7030

5559

633001

213

5 Śląski Bank Spółdzielczy Silesia in Katowice

Józef Myrczek

46011

42655

3356

8119

5383

584329

6 Bank Spółdzielczy in Gliwice

Krzysztof Kochański

33689

29547

4142

6057

4847

438061

7 Orzesko-Knurowski Bank Spółdzielczy zs. in Knurów

Józef Kapłanek

31695

25933

5762

3712

2889

389256

191

Head of the bank

Gross proﬁt/loss (value in thousands of PLN)

1 Krakowski Bank Spółdzielczy in Kraków

Name of the bank

Revenue from commission (value in thousands of PLN)

Revenue from interest (value in thousands of PLN)

Total revenue (Revenue from commission and interest) (value in thousands of PLN)

Ranking of cooperative banks in 2010

8 Małopolski Bank Spółdzielczy in Wieliczka

Edward Biernacki

30353

25863

4490

4777

3593

491302

136

9 Rejonowy Bank Spółdzielczy in Lututów

Marian Fita

29043

23823

5220

5154

3785

392028

168

10 Bank Spółdzielczy in Limanowa

Adam Dudek

28358

22049

6309

3398

2682

358807

167

11 Bank Spółdzielczy in Stalowa Wola

Stanisław Kłapeć

27431

20782

6649

7715

5964

340785

148

12 Poznański Bank Spółdzielczy

Stanisław Murawski

27424

22829

4595

5025

4023

434689

126

13 Kujawsko-Dobrzyński Bank Spółdzielczy

Cezary Maciejewski

27270

21970

5300

4306

3574

382149

142

14 Powiślański Bank Spółdzielczy in Kwidzyn

Irena Kopik

27197

21971

5226

6030

4850

394512

112

15 Warmiński Bank Spółdzielczy

Elżbieta Krasowska- Jaworska

23988

19142

4846

5500

4313

292136

122

16 Bank Spółdzielczy in Biała Podlaska

Helena Wasilewska

23830

20459

3371

4410

3470

324909

17 Bank Spółdzielczy in Płońsk

Teresa Kudlicka

22782

18475

4307

4108

3293

317735

105

18 Bank Spółdzielczy in Namysłów

Zdzisław Bąk

21661

17298

4363

2494

1929

279731

162

19 Bank Spółdzielczy in Oława

Ryszard Żuraw

19981

15926

4055

5001

3990

299382

100

20 Bank Spółdzielczy in Szczytno

Andrzej Górczyński

19739

15669

4070

4160

2963

258443

118

21 Bank Spółdzielczy in Czarnków

Władysław Dymek

19594

15500

4094

5776

4495

236069

22 Bank Spółdzielczy in Tarnobrzeg

Stanisław Grądziel

19026

14680

4346

3371

2663

271996

139

23 Mazowiecki Bank Spółdzielczy in Łomianki

Halina Choroś

17956

14749

3207

2066

1581

218098

24 Bank Spółdzielczy in Toruń

Jerzy Dąbrowski

17562

13875

3687

2810

2231

222257

25 Bank Spółdzielczy in Pleszew

Maria Górczyńska

17095

14129

2966

4781

3668

205361

26 Bank Spółdzielczy in Sochaczew

Kazimierz Majewski

16231

13157

3074

2519

2029

232014

102 95

27 Bank Spółdzielczy in Starogard Gdański

Zenon Błański

15156

11821

3335

2256

1725

197590

28 Bank Spółdzielczy in Gryﬁce

Krzysztof Michalczyk

14760

12272

2488

3920

3102

162361

29 Spółdzielczy Bank Ludowy in Złotów

Genowefa Goździejewska

14678

12188

2490

2448

1934

206353

30 Bank Spółdzielczy Mazowsze in Płock

Bożenna Guzanek

14365

10248

4117

1100

895

170220

112

31 Bank Spółdzielczy Ziemi Kaliskiej in Koźminek

Grzegorz Poniatowski

14286

11258

3028

3445

2721

192572

32 Bank Spółdzielczy in Nadarzyn

Wiesława Radziak

13627

10959

2668

4854

3851

148194

33 Bank Spółdzielczy in Inowrocław

Helena Kłosowska

13191

11382

1809

4273

3219

189708

34 Bank Spółdzielczy in Dzierżoniów

Elżbieta Nowakowska-Akkermans

13048

10079

2969

3472

2712

172016

35 Bank Spółdzielczy in Proszowice

Józef Banach

12934

10597

2337

2575

2066

199988

36 Bank Spółdzielczy in Łosice

Romuald Piotruk

12334

9699

2635

2914

2109

152485

37 Bank Spółdzielczy Pojezierza Międzychodzko-Sierakowskiego in Sieraków

Józef Kubanek

12081

9518

2563

2040

1529

149607

38 Bank Spółdzielczy in Lipno

Maria Roman

12046

9495

2551

3453

2777

144936

39 Bank Spółdzielczy in Zgierz

Elżbieta Zytek

11918

8676

3242

1773

1401

155771

62 ::

polish market :: 3/2011

Finance Jerzy Różyński, President of the Board of Directors of The National Association of Cooperative Banks (KZBS) We are aiming at a two-digit market share

banks manage over 4,500 establishments employing almost 33,000 people. Cooperative banks currently have a market share of 6-8%. I believe that this share should rise to two-digit numbers. The EU average is 20% and to achieve this level is our strategic goal.

Gross proﬁt/loss (value in thousands of PLN)

Net proﬁt/loss (value in thousands of PLN)

Total assests (value in thousands of PLN)

Employment

Written down and edited by Sandra Wierzbicka

40 Bank Spółdzielczy in Racibórz

Elżbieta Ceglarek

11394

9512

1882

1691

1378

163654

41 Lubusko-Wielkopolski Bank Spółdzielczy based in Drezdenko

Andrzej Kiszakiewicz

11357

8599

2758

2662

1971

136338

Name of the bank

Head of the bank

Revenue from commission (value in thousands of PLN)

Revenue from interest (value in thousands of PLN)

The low use of banking services in Poland, the subject of much recent discussion, concerns mainly small towns and villages. Expansion should be performed by means of cooperative banks. It is already happening: 576 cooperative

Total revenue (Revenue from commission and interest) (value in thousands of PLN)

fulﬁl their obligations to cooperative banks but fail to do this in relation to other banks. The cooperative banking sector is characterised by a very high customer loyalty rate. It is peculiar to the cooperative banking segment that customers generate a very low risk, which is much lower than in the case of loyal customers in other banking sectors. However as it is impossible to develop a business based only on loyal customers, information on customers is the key to the development of cooperative banks.

42 Bank Spółdzielczy in Jordanów

Roman Stec

10811

8995

1816

2567

2063

142108

43 Kaszubski Bank Spółdzielczy in Wejherowo

Krystyna Tomaszunas

10758

8214

2544

1716

1358

130030

44 Bank Spółdzielczy in Sierakowice

Roman Dawidowski

10661

8624

2037

3212

2592

152119

45 Piastowski Bank Spółdzielczy in Janików

Anna Kaczmarek

10544

8340

2204

2450

1990

145998

46 Pomorski Bank Spółdzielczy in Świdwin

Krzysztof Drapała

10519

7828

2691

1428

1170

125944

47 Bank Spółdzielczy in Raciąż

Piotr Pniewski

10283

8446

1837

3000

2416

122810

48 Bank Spółdzielczy in Skawin

Kazimiera Stochel

10144

6491

3653

1439

1095

109167

49 Bank Spółdzielczy in Kolno

Krzysztof Kajko

9844

7486

2358

2578

2051

126708

50 Bank Spółdzielczy in Wołczyn

Jacek Baldy

9760

6680

3080

1367

1070

131158

51 Bank Spółdzielczy in Sławno

Aleksandra Bukowska

9547

7200

2347

2431

1958

122453

52 Bank Spółdzielczy in Krapkowice

Teodor Pandel

9345

7699

1646

1346

1027

137238

53 Spółdzielczy Bank Ludowy in Zakrzew

Wiktor Kaaz, Jerzy Bieluszko, Teresa Konicer

9160

7846

1314

1575

1284

120279

54 Bank Spółdzielczy in Zwoleń

Irena Zawadzka

8877

7064

1813

1707

1340

117164

55 Bank Spółdzielczy in Halinów

Stefan Wanke

8828

6432

2396

1830

1423

100134

56 Bank Spółdzielczy in Cyców

Jadwiga Mazurkiewicz

8400

6155

2245

2100

1692

118844

57 Bank Spółdzielczy in Głogów Małopolski

Stanisław Pado

8303

6625

1678

1983

1632

117819

58 Bank Spółdzielczy in Nidzica

Maria Piasecka

8267

6577

1690

1795

1458

100826

59 Gospodarczy Bank Spółdzielczy in Choszczno

Tadeusz Drabik

8149

6508

1641

977

756

110643

60 Bank Spółdzielczy in Kowal

Halina Radziejewska

8012

6185

1827

1697

1357

117356

61 Express Bank Spółdzielczy in Rzeszów

Mieczysław Olearka

7787

6616

1171

1096

810

103282

62 Wschodni Bank Spółdzielczy in Chełm

Jerzy Dobosz

7410

5661

1749

1209

938

89518

63 Bank Spółdzielczy in Krotoszyn

Jan Pluta

7364

5806

1558

1469

1144

72608

64 Bank Spółdzielczy in Legnica

Gabriela Sołobodowska

7026

5085

1941

932

784

88417

64 48

65 Bank Spółdzielczy in Busko-Zdrój

Anna Karwat

7019

5770

1249

1152

782

92632

66 Bank Spółdzielczy in Będzin

Ryszard Olszewski

6843

3650

3193

1211

953

87807

67 Bank Spółdzielczy in Świecie

Brygida Fotta

6099

4431

1668

1 100

868

70 813

68 Bank Spółdzielczy in Biłgoraj

Henryk Wereski

6074

4258

1816

1521

1214

78533

69 Bank Spółdzielczy in Dąbrowa Tarnowska

Salomea Kozioł

6073

4823

1250

1797

1446

84712

70 Bank Spółdzielczy in Mikołajki

Stanisław Lachowicz

5900

4301

1599

1780

1419

69240

71 Bank Spółdzielczy in Łasina

Wiesław Drożdża

5326

4164

1162

968

763

68986

72 Bank Spółdzielczy in Łeba

Janina Godlewska

4720

3450

1270

955

771

45703

73 Bank Spółdzielczy in Kórnik

Katarzyna Zimniak

4326

3332

994

687

517

55843

74 Bank Spółdzielczy in Mrągowo

Alfred Jaworski

4171

2968

1203

740

579

43113

75 Bank Spółdzielczy in Księżpol

Janina Wolanin

4089

3236

853

917

645

41942

76 Bank Spółdzielczy in Tworóg

Kazimiera Huniak

3301

2524

777

737

594

37367

77 Bank Spółdzielczy in Pszczółki

Henryk Schulz

3298

2609

689

1019

811

38945

78 Bank Spółdzielczy in Konopiska

Włodzimierz Cichoń

2933

2251

682

526

423

33190

79 Bank Spółdzielczy in Wilamowice

Tomasz Królicki

2758

2150

608

589

455

32499

Source: banks

3/2011 :: polish market ::

Finance

We unite to expand our options Danuta Kowalczyk, president of the Management Board of Mazowiecki Bank Regionalny SA (MR Bank) in Warsaw, talks to Patryk Mirecki.

The merger of MR Bank and GBW will mark the end of a certain phase. Your bank’s logo will disappear and the longstanding tradition of the institution will become a thing of the past. What will happen now? We think it’s just a beginning of something new. Currently in Poland, there are three associating banks rendering services to cooperative banks. Their approach to business is slightly diﬀerent: some of them tend to concentrate on services for cooperative banks, the others on developing their own commercial ventures. GBW has branches and customers in western Poland. So, it’s our natural partner for business expansion. We do not cross each other’s paths in any way. It is a natural course of events to join our forces and boost the capacity of both institutions. That’s precisely why we think it’s just the beginning. The merger will result in the establishment of a national bank called SGB Bank SA capable of providing the market with appropriate products both for the associated cooperative banks and their customers. Is the planned merger going to be beneﬁcial for all the parties involved? Isn’t it going to cause mass dismissals of MR Bank and GBW employees? No, it’s not. Even though - as mentioned by professor Małgorzata Zaleska from the National Bank of Poland’s Management Board at a recent press conference - smaller associations (when there were more of them in our

bank than the present three) had been much closer to the associated cooperative banks. It would be hardly possible not to agree with that. But the show must go on. For example, if we want to develop, we must implement more expensive technologies. I think that the new structure will make it possible to organize the work of the cooperative banks in order to achieve the economies of scale and obtain fi nancial gains. The new bank could operate with two competence centres: one in Poznań (for banks formerly belonging to GBW), and the other in Warsaw (for MR Bank-related entities). The current proximity of the associated banks won’t slip through our fi ngers either. Contacting the associated banks, we’ll try to stick to the former association standards. We’ll make it possible for those banks’ representatives to ask us direct questions. We’ll act similarly with regard to GBW. Hasn’t the merger decision been enforced by the global financial crisis? The first merger discussions were held back in 2003 and 2004, but due to technological reasons and lower business costs the final decision on merging the two banks was not made. In 2009, we started thinking about the merger again because of the reasons I have mentioned. Since then we’ve been acting towards the realization of that objective. What will the new SGB Bank be like? There will be no major changes in regard to the current business carried out

This year will see the merger of two (out of three in Poland) associating cooperative banks: Mazowiecki Bank Regionalny (MR Bank) and Gospodarczy Bank Wielkopolski (GBW). Such a resolution was passed by the majority of 89.5% of MR Bank’s shareholders last February. The merger will take place pursuant to the Act on Cooperative Banks and the Commercial Companies Code. It will be carried out in the form of transferring MR Bank’s property to GBW in exchange for shares. These days, MR Bank is focused on investment ﬁnancing for its customers, i.e. individual farmers, SMEs, agro-business entities and local government units. It performs its activities in central and south-east Poland.

64 ::

polish market :: 3/2011

by the individual banks. They will keep operating under both the banking and cooperative laws. The former shareholders - cooperative society members – are going to remain where they are. Of course, the SGB Bank organizational structure will be uniﬁed. Would it be fair to say that the next merger we can expect will take place between SGB Bank and BPS? It remains to be seen what will happen once our banks are merged. I think it’s too early to talk about that idea. Let me tell you this: all the parties involved in the process (cooperative banks, merging associations, BPS and its associated banks) want to have a choice. If they are all joined together, the individual banks won’t have that possibility any more. At present, cooperative banks possess a 6-8% share in the assets of the whole banking market in Poland. How many years will it take for this share to grow – let’s say to 15-20%? Stronger participation of cooperative banks in the market surely is possible, but much later. At the moment, the market share does not constitute a goal in itself. Our tasks and customers are slightly diﬀerent. We don’t have to be in a race with commercial banks, as it is not our priority. ::

Economy

Katowice Special Economic Zone Co. th 15 anniversary This year the Katowice Special Economic celebrates its 15th anniversary. What do you feel when you look back? KSEZ: KSEZ was established in 1996 in order to support restructuring processes within the Silesian region. The idea was to attract investment and thus create hi-tech related workplaces. It is safe bet that this work has not been squandered. we have obtained over 200 industrial projects. In total the companies has invested Euro 4.4 billion and created around 44,000 new workplaces. After 15 years of operation we have become Poland’s biggest economic zone in terms of area, investment and employment. It is also here that the most modern (the most expensive) workplaces are created. Silesia is developing dynamically – with our undisputed contribution. The year 2020 will see the closure of special economic zones. What are the plans for the years to follow? We plan to develop three new industrial parks – 200 hectares in Ujazd, 100 hectares in Zabrze and 100 hectares in Tucznawa. These are very attractive

Gliwice investment area

these are very “modern” jobs one such workplace involves investment of Eur 250,000 as compared to the Polish SEZ’s average of Eur 100,000.

Upper Silesian Industrial Park – under construction

sites, also for larger investors and big players like GM in Gliwice. Winning a large investment results in the snowball eﬀect – it attracts further project (business partners, suppliers). In addition to our “traditional” manufacturing sector we would like to focus on attracting further companies from BPO/ IT and R&D sector. What has the year 2010 brought to KSEZ? Despite last year’s global slump we managed to draw 23 new investment projects jointly involving over EUR 250 million and providing at least a thousand jobs. I wish to stress that

4. In Poland the urge to invest in hi-tech is being discussed more and more often. What actions has KSEZ undertaken in order to facilitate such investments? We are well aware that innovation and hi-tech are crucial for competitiveness. We are a co-founder of the Technopark at Silesian University of Technology which supports the flow of knowledge and new technology from academic centers to the market. We are continuously searching for new hi-tech companies and encouraging them to invest in Silesia, which effort brings results much more significant than 10 years back – this is due to the fact that Silesia has proven to be very attractive region for investment. In today’s global economy era Poland must compete not just with the highly-developed countries but also rising economic powers like China and India. What are our strengths in this competition? Poland has no power to compete with China or India in labor costs. Our competitive advantage is the quality of human resources. Silesia is Poland’s most attractive region for investment due to its labor market and the best technical infrastructure in the country. We have to keep improving our offer by further investment in education, R&D and infrastructure. In the long run this will give us better competitive leverage. ::

Katowice Special Economic Zone Co. 42 Wojewódzka St., 40-026 Katowice tel. (+48) 032 251 07 36 ksse@ksse.com.pl www.ksse.com.pl

3/2011 :: polish market ::

Economy

With cautious optimism In their comments to February 2011 forecasts, experts are slightly more optimistic about prospects for this year’s economic growth than in the prior forecast round, but the comments are still fraught with uncertainty. This is mainly due to external conditions. Expectations vary. Marek Misiak EXTERNAL CONDITIONS Prof. Witold M. Orłowski (Independent Centre for Economic Studies - NOBE): “A lot indicates that the present crisis not only has not passed yet, but has not even shown its full proportions. We’ve only seen the initial phases, which can be followed by more. (…) My forecast of GDP growth in this situation of between 4% and 5% can be regarded as optimistic; there is considerable risk that things could get worse.” Prof. Krystyna Strzała (University of Gdańsk - UG): “(…) according to international analysts’ expectations, in more than 20 countries considered to be part of the so called emerging markets, there is a danger of anti-government protests, and consequently, political destabilisation (…). The political developments in African countries and their consequences for the prices of raw materials, particularly crude oil, are one of the most important sources of uncertainty.” Tadeusz Chrościcki (independent expert): “On the basis of the current European Commission’s forecasts, GDP is expected to increase in UE-27 member countries by 1.7% in 2011 and 2.0% in 2012, accompanied by a considerable variation in the economic activity of individual countries. The driving force behind EU economies will still be Germany, creating export opportunities for Poland.” Paweł Durjasz (Chief Economist at PZU): “The latest data point to an improvement of economic growth prospects for USA and Germany (including the euro-zone) in 2011.”

66 ::

polish market :: 3/2011

Łukasz Tarnawa and Aleksandra Świątkowska (Chief Economist and the Head of the Macroeconomic Analysis Team at PKO Bank Polski): “Summing the most important present developments in the global situation, one can name: progressing differentiation in the development trends of developed economies and emerging markets, still with cautious growth prospects (a dominant factor for the Fed’s monetary policy), fears of inflation growth are starting to ‘be heard’ – mainly due to the strong growth of prices of raw materials (which resulted in a fi rm communiqué from the European Central Bank, following the January meeting), on the currency market - the two dominant factors are: loose monetary policy from the Fed and, on the other side, a constantly growing global fiscal stability problem (no longer just an issue concerning peripheral countries to the eurozone, but ever stronger stability risks of USA public fi nances) high variability in the prices of fi nancial assets as a result of a changing risk premium assessment.”

GDP Th is is how experts are describing the causes of revisions in the forecasted growth rate. Prof. Władysław Welfe (University of Łódź - UŁ) is expecting a livening of investment activity from the beginning of 2011 which – as he writes – “may bear fruit in the form of an annual growth rate in gross ﬁ xed asset formation of about 9%.” During 20122013, he expects “a continued growth in expenditure (of approx. 9.5-10.5%),

related to the implementation of infrastructure investment projects and a growth of foreign direct investment.” Prof. Andrzej Wernik: “Good results in the fourth quarter of 2010 justify the acceptance of more optimistic assumptions for this year than in the prior estimate. Th is mainly concerns GDP as well as its main constituents, in real terms.” Bohdan Wyżnikiewicz, PhD (Gdańsk Institute for Market Economics – IBnGR) has revised his expectations in a similar direction. He is currently forecasting a GDP growth of 3.7% for 2011 (previously 3.4%). According to this forecast, GDP growth will be 4.1% in Poland in 2012, which will be possible owing to growing investments and an improvement of the situation in the labour market. The IBnGR forecast was prepared under the assumption that: interest rates in Poland will grow by a combined 100 basis points in 2011; the złoty will appreciate only slightly during 2011–2012; the ﬁ nancial situation in the euro-zone during 20112012 will gradually stabilise.

EXTERNAL BALANCE, INFLATION, LABOUR MARKET If we accept external balance as a criterion then the February 2011 forecasts of Polish Economic Society (PTE) experts are, both in the long and the medium term, somewhat less optimistic than those from November 2010. The deﬁcit in the current account of the balance of payments is growing faster, as is the ratio of imports to exports. Despite corrections, Poland still stands out positively in the group of new EU members, both in terms of a relatively low ratio of current account deﬁcit to GDP, as in relatively high currency reserves. Prof. Jan Przystupa: “The decline in exports growth to 10.6% in 2011 will likely not be accompanied by a proportionate reduction in imports growth. The negative contribution of

Economy

Paweł Durjasz: “The signs of pressure on prices due to demand are still not visible yet. In the coming months, inflation will grow to the upper limit of fluctuations allowed around the Monetary Policy Council (RPP) inflation target, since fuel prices are strongly appreciating. A considerable growth of food prices is still possible, as is seen in other countries. VAT rates have been raised at the beginning of this year. Th is will have to lead indirectly to the growth of core inflation from the presently low level. Th is will contribute to upward pressure on wages. Reasons to worry that the ‘effect of the second round’ will be substantial are not visible yet.” The current forecasts on the labour market are less pessimistic compared to the prior ones. Employment and wages are slowly on the rise. Experts expect a gradual decline of the unemployment rate following the fi rst quarter of 2011.

PUBLIC FINANCES Tadeusz Chrościcki: “A high structural deficit of federal and regional government institutions, as well as the risk of crossing the second cautionary threshold, require fast and decisive consolidation actions.” Prof. Krystyna Strzała: “I believe that during 2011-2012, government actions, some of which have been discussed for a long time, should include a decisive reduction of the public sector deficit, and improving the budget structure by reducing the share of fi xed expenses.” Prof. K. Strzała recommends an urgent improvement of the procedures for the implementation of projects cofi nanced from EU funds. According to her, a lot depends on the better functioning of the administration and an improvement in conditions for business, including small and medium enterprises.

exports to GDP growth will amount to 0.5 percentage point. Despite this, GDP may grow to as high as 4.1% in 2011. However, exports (particularly of services) will likely grow by more than 12% in 2012, and imports by around 13% (net exports will amount to -0.6 percentage point). With a 5.6% growth in domestic demand, the rate of GDP growth may exceed 5%.”

Łukasz Tarnawa and Aleksandra Świątkowska: “From the country’s internal factors that could limit the appreciation potential of the złoty, the main risk factor is the fi scal situation.” Analysts at PKO BP have made the following assumptions: an average real GDP growth for the nearest three years of 4.1% and nominal growth of 6.9%; maintenance of higher VAT rates following the changes in January 2011, reduction in the cyclical deficit of regional governments and social insurance, periodic growth of the deficit in the road infrastructure fund during 2011-2012, reduction in the deficit of the EU funding budget during 20122013, realising revenue from privatisation at a level close to PLN30 billion in the course of the next three years. With these assumptions, it is believed to be possible to “limit the deficit of the public fi nances sector by around 3% GDP from around 8% GDP in 2010. The limitation of borrowing requirements due to changes in Open Retirement Funds (OFE) has translated into a deficit decline by another 1% of GDP, hence in order to reduce the deficit below 3% of GDP by 2013, further savings are needed in the order of 1% GDP, hence PLN15-20 billion.” Prof. Władysław Welfe expects a budget deficit at a level from -3% to -4% after 2011 and recommends that actions

consolidating public fi nances should take the need for spending on future development into account. Prof. Andrzej Wernik: “In terms of budget, it can be expected that execution will turn out to be more favourable than the wording of the budget legislation itself. In terms of the general situation in the public fi nances sector, there will be an improvement compared to the assumptions. The combined deficit will be reduced by at least one percentage point of GDP, but the decisive role will be played by decision factors. Correct decisions, including the reduction of the fraction of retirement contributions going to open retirement funds, may cause a deficit reduction of as much as over three percentage points of GDP.”

*** Although, as already stated at the beginning, the assessment of the current economic trends in Poland by PTE experts is somewhat more favourable than during the prior round of forecasts, much will depend on diﬃcult to foresee changes in external conditions and on the implementation of recommended measures in the Polish economic policy.

The full commentary of PTE experts is available online at www.pte.pl.

3/2011 :: polish market ::

Opinion

Polish managers abroad Poles are helped in their careers by their determination to study, experience gained during the period of transformation, building companies from scratch (beginning of the 90’s), knowledge of at least one, sometimes two, foreign languages and documented successes in developing and managing companies in Poland. Daniel Lewczuk

Daniel Lewczuk completed the Kentucky Christian College, KY, with an undergraduate degree in Management, and also Hope International University in California, with an MBA in International Business. He has been involved with the executive search business for 13 years, initially working in different positions for a renowned executive search firm, i.e. as the Director of Operations and Procurement. His success includes projects implemented in Central & Eastern Europe, in upper management positions. Since 2004, as an entrepreneur, he has been developing a group of several advisory firms, being the owner, including Executive Network Limited, which is part of IMD International Search Group, an executive search network, having 40 offices in 27 countries. Daniel is also the co-owner of the firm GoldenLine Limited, and ClickQuickNow Limited. For several years, he has been also a member of the Polish Business Roundtable Club. He is fluent in English and also knows Russian and Spanish.

68 ::

polish market :: 3/2011

The talent of typical Polish managers, who back in the 1990’s were still learning, at an expedited rate, best practices from their colleagues from more developed markets (France, England, Germany, etc.), has also caught the attention of many organisations. By the end of the 1990’s, a constantly growing number of organisation managements chose a Pole for the position of president, sending expats from other countries on to new markets (the Baltic countries, Ukraine, Russian and other CEE countries), placing more responsibility and greater trust on local management. This is how the careers of hundreds of Polish managers on the management teams of international companies began. Today, many known names on the market sit on the top regional management boards of world corporations: Tomasz Bochenek (Microsoft), Ryszard Malinowski (Intel), Lesław Kuzaj (GE), Andrzej Dopierała (Oracle), Artur Waliszewski (Google), Andrzej Dąbrowski (Philip Morris), Katarzyna Kieli (Discovery Networks Europe), Brunon Bartkiewicz (ING), Piotr Kaczmarek (Alfa Bank), Wioletta Rosołowska (Tchibo), Maciej Witucki (France Telecom/TPSA), Paweł Czajkowski (HP), Agnieszka Romańczuk (Avon), and many others. Today, several hundred, and maybe even several thousand Polish managers pursue their careers outside of Poland. The majority of leaders pursuing careers in managing ﬁ rms in Poland or in the region are men, frequently working in the IT/Telecom sectors, most frequently for American corporations, possessing higher education, most often from the Warsaw School of Economics.

Abroad, many Poles have contributed to a positive image of Poland through the effective management of organisations. Work, experience, and successes of such people as Janusz Kulik (Penny), Maciej Łebkowski (AlfaBank), Tomasz Muras (Avon), Tomasz Bochenek (Microsoft) are icons of Polish business, who have been acknowledged in the organisations in which they work. More and more Polish businessmen are achieving success outside Poland: Adam Góral (Asseco), Krzysztof Pawiński (Maspex), Jan Kulczyk (KH Investments), Wojciech Ingot (Ingot), Leszek Czarnecki (LC Corp/Getin Holding) and Michał Sołowow (Echo Investment). Practice and experience gained outside of Poland are frequently an indispensable and essential capital, bearing fruit further down the career path. As considered by Paweł Wojtaszek, a director, who spent several years abroad, working for Societe Generale: “The scale of business in Paris, London or New York is unimaginable from the point of view of someone who has worked only in Poland.” In the opinion of Paweł Wojtaszek, “foreign corporations are fully aware that it is the person, his abilities and contacts that are the greatest asset and are able to pay for this kindly.” Krzysztof Urbanowicz, who managed Unipetrolem outside of Poland, among others, claims that “Shell sends its most talented managers to work in other countries. Poles are creative, able and accustomed to hard work in Poland. However, work abroad is more difficult than at home, but also gives an opportunity to gain an entirely different perspective and experience, which can then be useful in new challenges and handling practically any situation”. According to Piotr Kaczmarek, Head of Retail at Alfa-Bank, for many years, living in Ukraine, “Polish top managers in the east are prized for experience gained in a more developed market, although similar to the one in the Ukraine, and for the ability to work in a post-Soviet culture. Th is is

Opinion not only an issue of language, but above all, very little cultural difference.” Agnieszka Romańczuk, VP of HR for North America, USA, Canada and the Caribbean, working in the Avon headquarters in New York, is convinced that what is helping her and what differentiates her from other colleagues is “determination” and “pressing” for results, independence, proactivity and directness. For Marcin Marszałek, who has been the VP of Business Development for four years for Western and Central Africa in the Telecom sector, “knowing 3 languages, being multidisciplinary, and quickly adapting to new environments, and also an ability to “fit in” with the surroundings is what is the most significant, especially in the so called emerging markets.” Tomasz Bochenek, who for many years has been responsible for the CEE region in Microsoft, says that in comparison to foreign colleagues, “Poles like to compete with western specialists, have greater determination and a hunger for success. They are characterised by a pragmatic approach and openness to change.” Jacek Myrcha, also from Microsoft, notices that, thanks to their experiences from the region, Poles “better understand

the speciﬁcs and culture of our region (CEE). Polish ideas are concrete and usually bring about anticipated results, and thanks to intuition, also considerable successes.” According to Janusz R. Guy, who spent many years working outside of Poland in markets such as USA, Italy and Russia, the key attribute necessary to achieve success is the “level and quality of education, knowledge of languages, competence in building professional relations with other people, ability and desire for mentoring, passion for the profession, ability to lead an organisation and achieve above-market goals.” Those Polish managers, who successfully migrate out of their country to follow their career, stand out in terms of the scale and breadth of experience gained. Especially during the beginning of the Polish transformation, mangers in companies (both local and international), operating in Poland and in the CEE region, had the opportunity to very quickly gain comprehensive experience on the market and in an economy that simply exploded with its dynamic. Those who stood out climbed very quickly in the hierarchy of their company and were elevated to international business, and certainly

to regional business, on the basis of “sharing of best practices”. There is also a negative side of building a career in conditions of constant rapid growth, which the market of Central & Eastern Europe has gone through. Namely, in the case of a downward correction to the market development dynamics, or even a recession, value-based management through cost reduction is a management practice requiring a diﬀerent sort of experience. Central and Eastern European markets and the group of our top managers are just passing through this experience.” The most common challenge for many professionals is to balance professional career with private life. There are regions, such as the Middle East, where it is not always easy for families to support a person pursuing a career abroad due to local diﬀerences and conditions. It is also a challenge when there is a necessity to move the family from country to country, and children from one environment to another. These relations, frequently strong, are broken every 2-3 years in order to meet the challenges in the next country, in a new company, on a new market. It is the pressure and consideration for family that are the most frequent reason for Poles returning to their country. :: ADVERTISEMENT

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Opinion

Cross-cultural differences in management An American superior posed a question to his employee on the amount of time required to fulfil a task. The employee was appalled by the superior’s position: “He is the boss, why doesn’t he say it himself?!” The superior was an American and the employee a Greek – and this is where the real answer as to the cause of the misunderstanding is – its source is a different way of thinking due to cultural differences. Katarzyna Niezgoda

The author is president of Deni Cler Group S.A.

70 ::

In countries with a small power distance (the United States are among them), the subordinate is to a great extent responsible for initiative and the question which the American boss asked was a display of egalitarianism. However, in cultures with a large power distance, the boss issues an order and does not allow for discussion. When the behaviour of the superior departs from the authoritarian, the subordinate ceases to feel surefooted. Despite that during the 80’s, the popular view was that excellence of an organisation is based on a common way of thinking of all of its members, presently, in the case of international corporations, attention is paid to cultural context. Management practices which are successful in some cultures can be ineffective in others. Cultural differences concern several dimensions – one of them is the aforementioned power distance. In cultures with a small power distance (i.e. German-speaking countries), relations between a superior and a subordinate are more egalitarian – subordinates do not have a problem with expressing their opinions, even opposition. A hierarchic system only means that there are different roles and positions – and this can change at any moment. However, in cultures with a large power distance (i.e. Slovakia or Russia), hierarchy at the workplace is the mirror image of existentialistic superiority and inferiority, employees do not discuss things with the boss since they are

polish market :: 3/2011

awaiting all decisions from him or her. It is for this reason that the management method that assumes negotiation between a superior and a subordinate will not prove itself in cultures with a large power distance. Th is does not mean, however, that one culture is better or worse. Each of them has its strong and weak sides. Knowing the cultural context, it is possible to take advantage of the characteristics of a given population to improve efficiency. For example, countries with a small power distance will work better in assignments requiring initiative, however, if the task requires discipline, then the most effective approach would be to locate it in a country with a large power distance. Knowing the culture of a given country can also be helpful when implementing a motivational system. The effectiveness of the reward system will vary, depending on whether a given culture is collectivist or individualist. In the case of the former, the good of the whole is placed above that of the unit, and employees from those countries prove themselves better in group actions than individual ones. To the extent that a person coming from a collectivist culture will be motivated by a reward for the entire team, to the same extent, this reward will discourage an employee coming from an individualistic culture: “Well, I worked so hard, and others are skimming the cream.” While designing the reward system, it is worthwhile to also take into account

another dimension of cultural differences, namely uncertainty avoidance. Countries where this factor is high have a tendency to form a high number of laws and regulations. Citizens feel better in well-defi ned structures. Rules are frequently absurd but still serve their function – give a feeling of security, and this is very important for societies with strong uncertainty avoidance. In these countries, pay is dependent more on seniority than accomplishments. In reality, there is no single effective management method. Managers and employees are part of societies and cultures. In order to understand their behaviour, it is necessary to discover the specifics of a given country or group. How can this be done? The fi rst step is to realise that differences exists, then one should get to know a given culture. A source of knowledge will also be the family model which dominates in a given country (at the early stages of life, it is the family that has a great influence on the values cherished later), education system or the functioning of the state. One should never belittle art and literature. Knowledge of a given society is necessary for the understanding of management methods used in that country. And even if we do not share the values that are professed by representatives of a given society, knowledge of them will help pinpoint differences and choose the most effective management method for the region. It is worthwhile to also invest in different kinds of training on crosscultural communication (not even mentioning learning the language). There are two types of courses available on the market – traditional, whose goal is to transfer knowledge about a given country and training, focusing on the essence of cultural differences – they do not impart knowledge about any particular society, but are a tool thanks to which it is easier to understand the issue of cultural differences. ::

Opinion

Financial supervision after three years Prof. Małgorzata Zaleska Financial supervision systems differ from country to country. But they may be divided into two general models: non-integrated and integrated ones. In the fi rst model, individual segments of the fi nancial market, like for example banking and insurance, are supervised by separate institutions. In the case of the integrated model, all segments and institutions of the fi nancial market are supervised by a single institution. The integrated model is also termed as “supervision under one roof” or as “super supervisor.” In the early 21st century, there was a trend towards integrating individual

supervision authorities and departing from the non-integrated model. It should be noted that the concept to integrate supervision authorities had emerged much earlier. It started in Europe in Scandinavian countries in the 1980s. There are many factors in favour of integrating supervision authorities and many against it. The capital ties between fi nancial institutions operating in different segments of the financial market and the merging of financial products and services are the arguments for taking a comprehensive look at the market. The process of integrating the systems of supervision over individual segments of the fi nancial market

has already taken place in Poland. At present, the Polish Financial Supervision Authority (KNF) is responsible for integrated supervision over the fi nancial market. The integration of individual supervision authorities into the KNF proceeded in stages. In January 2011 three years passed since the KNF took over supervision over the banking market. Anniversaries prompt us to make summings-up and assessments, which are not always unambiguous. The fi rst years of the integrated supervision system in Poland coincided with the global fi nancial crisis. In response to this crisis, some countries started to reform their supervision systems, making them non-integrated again and increasing the involvement of central banks in supervision. The Polish banking sector was not directly affected by the global fi nancial crisis – throughout the crisis period the sector generated a profit, and increased its equity and capital adequacy ratios. Additionally, no bank in Poland needed a bail-out and the ADVERTISEMENT

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3/2011 :: polish market ::

Opinion most recent bank bankruptcy in the country took place in 2001, or 10 years ago. As a result, in the past three years the Polish supervision authority did not have to take any extraordinary measures towards banks while it is in such situation that a system may prove its worth. The ﬁ nancial crisis also showed the important role of ties between individual countries and ﬁ nancial markets. In this connection, it was decided there was a need to establish a formal European supervision system over the

fi nancial market, including macroand micro-prudential supervision. The KNF is still responsible for supervising the fi nancial market in Poland. However, the European supervision authority has the right to define standards and interpret events and regulations. Of course, with the establishment of the European supervision authority, the KNF faces new challenges. Firstly, the KNF should defend national interests, including the local supervisor, in the process of EU efforts to ensure

cross-border supervision. The second challenge to the KNF is to retain adequate powers as some of them will be taken over by the European supervision authority. 2011 and the next years will show whether the KNF will be able to meet the new diﬃcult challenges. ::

The author is a member of the Board of the National Bank of Poland (NBP), full professor at the Department of Banking Warsaw School of Economics (SGH) and member of the Presidium of the Committee on Financial Sciences Polish Academy of Sciences (PAN).

Bureaucracy – calculate and eliminate Andrzej Arendarski, PhD

Co-founder and president of the Polish Chamber of Commerce right from its inception

72 ::

In January, the Ministry of the Economy announced the results of its work to eliminate administrative burdens for entrepreneurs. As we found out in 2010, the experts completed the process of identifying the burdens. They had a lot of work to do – over 6,000 notification duties were analysed during this process, which were identified in 48 judicial acts. The goal of the analysis was to help undertake the right steps to make the entrepreneurs’ lives easier, as currently they have to struggle with bureaucratic requirements. “One of the changes announced by the economy department is the elimination of the circulation of paper documents connected with starting and running a business. The documents, once submitted by an entrepreneur at a single point of contact, will automatically be sent to other units of government administration, which will allow faster and more effective registration in one organised system – the Central Business Activity Register and Information System (CEIDG),” reads the announcement of the Ministry of the Economy. Other suggestions include adjusting tax inspection plans

polish market :: 3/2011

in companies to the work mode of entrepreneurs, introducing the possibility of submitting electronic applications to the Central Ofice of Measures for setting up official approval points, and limiting requirements for preparing certified translations and copies of documents. Now it has all been calculated and analysed, and entrepreneurs are eagerly waiting for the implementation of the regulation reform. Excessive bureaucracy not only wastes the time of entrepreneurs, but also creates additional expenses for the economy. According to last year’s Deloitte report, commissioned by the Minister of the Economy, administrative costs paid out by entrepreneurs in Poland amount to almost PLN 78 billion per year. It constitutes approx. 6% of GDP! The most troublesome and unnecessary requirements cost the Polish business PLN 37.3 billion a year, 2.9% of GDP. In this context, it is worth mentioning that this year, in July, the Central Business Activity Register and Information System (CEIDG) will be launched. Implementing this system will allow the introduction and general

implementation of an electronic administration system and will facilitate the running of a business. Setting up a company will be possible via the Internet. Any prospective entrepreneur can also make use of help from an active representative, who will go through the whole process for him. Such support will be available from chambers of commerce. The changes also include the approach to electronic invoices. The draft amendments recently evaluated by the Polish Chamber of Commerce to the laws on electronic signature, Value Added Tax, the civil code and general registry and identity cards, which are supposed to facilitate invoice circulation, are considered by us as an important step forward. I hope that the year 2011 will turn out to be a turning point in improving the eﬃciency of business activity registration, transition into e-commerce and limiting unnecessary bureaucracy. First and foremost it is the only way in which we can close the gap between ourselves and other, more developed countries. Secondly, it simply pays oﬀ. ::

Opinion

Health resorts need a few adjustments The Polish health resort sector has great potential, but it requires immediate ﬁnancial support. Attracting investors and commercialisation give health resorts an opportunity to develop. Thanks to investments, the quality and standards of the services will increase, and, if this happens, resorts will be visited by both those with lower and those with higher salaries, for whom spa centres, which have recently been springing up like mushrooms, are an alternative. Ewa Małyszko

The author is Vice-President of the Management Board KGHM TFI.

The growth prospects for the health resort sector in Poland are very promising, but its privatisation must be continued. Polish health resorts, in order to compete with private spa centres, must receive subsidies, while their range of services must be modernised. Unfortunately, the recent amendment to the Act was blocked in the Polish Parliament, thus leaving Ustroń, Krynica, Żegiestów, Ciechocinek, Kołobrzeg, Rymanów, LądekDługopole, and Świnoujście, along with Busko, in the hands of the State Treasury. Still, I hope that the present situation will be temporary, and that all Polish resorts will soon be given equal chances to be privatised, and obtain additional funding. All the actions carried out to this day have only resulted in qualiﬁed success. From the point of view of an investor, such as KGHM TFI, who is already a shareholder in several resorts in Poland,

the awareness and responsibility of their employees has become immensely important, as has the understanding by local communities and decision-makers of the significance of the investor’s role. Believe me, the role of the fund we manage is not restricted to making a profit and multiplying the assets held. I also see social responsibility as crucial, as I am fully aware of the significance of these types of companies as employers in their localities. After all, entire regions and local communities will benefit from investments in health resorts. A well-run sanatorium attracts numerous visitors, and tourists from Poland and abroad, thus creating new jobs and stimulating the growth of the local community. It also has positive side effects, such as promoting the region and boosting its significance on the map of Polish and European health resorts and recreational destinations. It is worth remembering that the health resort business

A Kiss for Four Seasons Is a newly commissioned series of Agnieszka Szyfter’s work completed in the second half of 2010 and the beginning of 2011 in Warsaw, Poland. The series is about a kiss as a symbol of love, proximity and unforgettable moments between people, humans and nature as well as between humans and the universe. The kisses give a vibrant energy to the whole collection, thus The Kiss for Four Seasons series transmits good currents all around. The series will be unveiled at the Ning Space Gallery in Beijing in April, 2011. The exhibition is organized under the patronage of Republic of Poland Embassy in China. Please enjoy the collection.

brings both profits and responsibility. Employment restructuring is obviously necessary for a company to be profitable and effective. When such actions lead to growth, then, in the long run, they will result in new jobs. A smart strategy is one which draws on the unique nature of the place, and takes as much advantage as possible of its potential as a health resort, including its natural resources. The opinion that health resorts will not maintain contracts with the National Health Fund (NFZ) is groundless. Private hospitals and clinics are actually doing what they can to sign those contracts, and none of the already privatised resorts have withdrawn from cooperation with the NFZ. It is the privatisation of this sector that would be of benefit to us all. Blocking the Act is equal to thwarting investment opportunities, and, as a result, the development of not just health resorts, but also entire regions. Already today the financial needs of this sector are estimated at PLN1.3 billion. Polish health resorts are long past their times of greatness. Today they need major investments if they are to be able to compete with the packages of the neighbouring countries, which are very strong. It is enough to take a look at the investments flowing into this sector in Lithuania or Slovakia. The current trends on the European market clearly show that healthcare, beauty care and rehabilitation services are constantly developing, with quality standards on the rise. Whether Poland will take advantage of this opportunity depends for the most part on completing the process of privatising those health resorts that remain owned by the State. ::

INVITATION

w w w . s z y f t e r. p l Please join us for the Opening RecepƟon launching Agnieszka SzyŌer's latest collecƟon Opening RecepƟon at the Ning Space Gallery:

Saturday April 2nd, 2011 3:00 - 6:00 PM

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Agnieszka Szyfter Paintings Exhibition Ap ri l 2 - 11, 2011

Kiss

for

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Ning Space Gallery 798 Art Dis t rict Be ijing

Investors recommend PAIiIZ services The Polish Information and Foreign Investment Agency is perceived as a professional institution with extensive knowledge of the Polish market, as well as a wide group of contacts necessary when investing in our country. Foreign investors gave PAIiIZ an overall rating of 4.5. It is the highest rating of the Agency since the beginning of research (4.1 in 2009 and 3.7 in 2008). Most participants in the research perceive the Agency to be an important partner in the investment process. The fi rst contact with the Agency has been assessed positively, and investors highly value the professionalism of PAIiIZ workers, though 29% respondents indicated, that initially they were not fully aware of the type of services and help to be expected from PAIiIZ. In this year’s research, 90% of respondents stated that PAIiIZ was a reliable and professional business partner. Meetings with PAIiIZ staff were evaluated very positively (84%), as were the degree of preparation and competence of the staff who contacted the investors (95%) and the quality and content of the written information provided to the investors (72%). However, the investors still expected the Agency to further expand its activity in the field of consulting and support.

Uflex Group will invest in Poland The Indian Uflex Group is one of the five biggest world manufacturers of flexible packaging fi lm (elastic laminates and plastic bags, standard and metallised BOPET/BOPP/CPP/coextruded fi lm). According to the motto saying that it is important to be in touch with the client, the company decided to make a significant step forward when it comes to international operations and to invest in creating a large production facility in Europe. The fi rst European production project will be located in Poland. The fi rst stage of this operation, a production line, will be constructed, facilitating the manufacture of an 8.7-metre wide biaxially-oriented polyester fi lm (Biaxially-Oriented Polyester - BOPET) operating at a speed of 500 metres per minute, as well as a plasma-enhanced vacuum-metalizing plant near Poznań, in central Poland. The plant is organised under the aegis of Flex Film Europa. Th is modern BOPET fi lm factory will be equipped with the world’s biggest fi lm production line and will be able to manufacture approx. 36,000 tonnes of fi lm annually. The total cost of the fi rst stage will be USD 90 million, and the launch of commercial production is planned for the fi rst half of 2012. The existence of the plant will give BOPET fi lm users short-term order fulfi lment.

Federal Mogul in the Tarnobrzeg Special Economic Zone A new investment project of American company Federal Mogul consists of an extension to the existing plant in Gorzyce. In order to fulﬁ l contracting parties’ requirements, the company is planning an investment consisting of the creation of two brand-new, fully-automatic production lines for engine pistons (for petrol vehicles and heavy diesels). The investment will facilitate

74 ::

polish market :: 3/2011

a signiﬁcant increase in the production level and extension of the company’s products’ availability on the European markets. During the implementation of the investment, the investor is going to place emphasis on the use of modern technologies, so that new products fulﬁ l all the clients’ needs. The extension of the plant in Gorzyce will take EUR 7.5 million of investment expenditure and the employment of an additional 20 people. The planned investment has obtained permission for its activities within the framework of Tarnobrzeg SEZ.

Hamilton Sanstrand in Rzeszów An American company from the aviation industry sector, Hamilton Sundstrand, owned by the UTC (United Technologies Corporation) is realising a production services investment in Rzeszów, combined with an R&D branch. The new plant will be the location of the manufacturing and servicing of APU (auxiliary power unit) engines, supplying planes during lay-time on the airport apron and constituting an emergency power supply unit during ﬂ ight. Due to this investment, Poland will become the ﬁ nal supplier of the product for the world aeroplane corporations. The planned investment will use approx. EUR 20 million of investment expenditure, creating approx. 250 jobs. The planned investment has obtained approval for its activities within the framework of the EuroPark Mielec SEZ.

Prospects for the socioeconomic development of Śląskie province Śląskie province is the most attractive location for investors. Th is has been confi rmed by the ranking of the Gdańsk Institute for Market Economics, according to which the region is the strong leader. Currently, there are over 200 companies in the province. Others are about to emerge, tempted by the resources available due to the country’s fi rst investment information centre, Invest-in-Silesia.pl. Economic and investment promotion is also being carried out by Metropolia Silesia, an association of 14 communes with county rights. Despite being one of the smallest provinces on the map of Poland, it is the most populated one, with 4.7 million inhabitants. The province generates 13% of the Polish GDP, ranking second in the country. There are 430,000 companies registered in this region, 96% of which are private entities. Annually, 200,000 professionals graduate from 51 universities in the province. The investment potential of the province is additionally enriched by a network of institutions supporting businesses and the huge scientific and research potential. Traditionally associated with the extraction of coal, the region is now oriented towards development and innovation. Answers to the above questions will be given by the panellists and speakers at the “Smart Development” seminar, taking place in February 2011 in the capital of the province Katowice. The seminar is yet another in the “Prospects in Poland” series of meetings, promoting Polish cities and their investment opportunities. ::

Polish Presidency

Ahead of Polish Presidency of the EU Council. Trouble-maker in the Lisbon setting? “There are five conditions essential for exercising of a presidency: domestic political stability, domestic administrative coordination, civil servants and politicians Europeanization, cultivation of the big actors in the EU and the PR machine”, says Petr Drulák. So is Poland up to its upcoming post-Lisbon presidency in the EU? Sandra Wierzbicka To look into that, the Polish Institute of International Affairs (PISM) held a seminar “EU Council Presidency – Past, Present and Future Prospects” with the participation of Petr Drulák, Director of the Institute of International Relations, Prague, and Leszek Jesień, European Union Programme Coordinator at PISM. What can be expected from the Polish Presidency? Drulák tried to answer this question by analyzing the past presidencies of two countries from Central-Eastern Europe - the Czech Republic and Slovenia. He presented the results of his research carried out together with Slovenian Zlatko Šabič. “We outlined a way to think about a presidency. We evaluated past presidencies according to two questions which seemed essential to us in evaluating presidency performance. The first question is: did the presidency bring results? The second question - was the presidency biased or impartial? On the basis of two questions we distinguished four presidency types. The fi rst type is both effective and impartial. We called it the Winner presidency. The past examples of Winner presidencies are the Finnish presidency of the late 1990s or the recent German presidency which managed to launch the Lisbon Treaty process. The opposite is the Loser presidency - it has no results and people feel that the country was trying to promote its interest. Historical example could be the last Italian presidency,

which was supposed to complete the constitution treaty but they did not manage to. There are two types in between - a presidency which is not really eﬀective, but is impartial. That’s usually the presidency of small countries. They don’t have enough resources, but they don’t have their big European interest either so they can be impartial. Most small countries run a Hesitant presidency. And then we have the eﬀective but not impartial presidency. We call this Arrogant presidency - the textbook example is the French presidency.” One of the things the researchers also tried to explore was the link between the quality of EU membership and the presidency performance. Th is brought two other questions: to what extent does the country subscribe to or compete European norms and does the country have enough resources to implement EU regulations. Th is resulted in another typology. The countries which have both the will and ability to comply with EU regulations are called Role Models Germany is a good example. The opposite type is a country which does not like Europe much and does not have enough resources to implement EU regulations - a Trouble-maker. A country which does not compete the norms but does not have enough resources is the Foot-dragger and it is usually the case of new EU member states - Greece is a good example. The opposite is a country which has

enough resources, but has secondthoughts and is called Euro-sceptic - like Denmark and UK. Is Poland a trouble-maker in the EU? Will it run a hesitant or arrogant presidency? Or maybe it will be a role model? “As useful as the experience of the Czech Republic and Slovenia may be for Poland, we operate in different reality now - the post-Lisbon reality in which the role of the presidency itself is diminished,” said Leszek Jesień. He believes the Lisbon Treaty had stripped the rotating presidency of the activity and influence which was the most visible - dealing with the externalities of the European Union. Security policy was moved into the hands of Mrs Catherine Ashton and the permanent president of the European Council Belgian Prime Minister Herman Van Rompuy. What has remained in the hands of the presidency is to run other councils and to represent the Council in the intra-EU institutional game. “It is bound to work on behalf of the member states even more than it did in the past,” Jesień underlined. “The pre-Lisbon presidencies were EU presidencies while post-Lisbon presidencies are EU-Council presidencies” he pointed out. But what are the real issues Poland is likely to have to deal with during its presidency? The experts believe it will be matters connected with EU enlargement - Romania and Bulgaria entering the Schengen zone, watching the southern border of the EU and tackling issues such as the accession of Western Balkans to the EU, emigration from North Africa, limiting carbon emissions, handling the economic problems of EU governments, implementing of fiscal consolidation, natural disaster management, dealing with the aftermath of the “Arabic winter” and addressing matters connected with the Eastern Partnership. Will Poland be able to manage these challenges? :: 3/2011 :: polish market ::

EURO 2012

Infrastructure revolution

compiled by Joanna Fijałkowska

Preparations in Gdańsk for the European Football Championships - interview with Gdańsk Deputy Mayor Maciej Lisicki.

How do you assess the meeting with UEFA Euro 2012 Operations Director Martin Kallen? I assess the meeting very well. The best proof was that Martin Kallen had practically no questions. We are in regular contact with UEFA and inform the Union about Gdańsk’s on-going preparations for Euro 2012. What in your view are the business aspects of Euro 2012 for the city? The European Football Championships have become a catalyst for the development of the city and the areas around it. While preparing for the event we have won substantial funds for infrastructure projects. A real revolution is on the horizon as far as new roads are concerned. With new hotels built as well as business premises for investors set up on and around the site of the new sports stadium, Gdańsk is clearly becoming even more business friendly. According to a recent

survey, 83% of Gdańsk inhabitants expressed the view that the city will benefit enormously from organising the Euro 2012 events in the city. We’ll do the utmost on our part to ensure that everything goes well. What does Gdańsk offer to foreign businesses in connection with Euro 2012? We estimate that about 200,000 foreign sport fans will visit Gdańsk during the championships. That augurs hefty profits for the tourist industry in the broadest meaning of that word as this takes in hotels, souvenir producers, restaurants and eateries, some of which are here in foreign hands. Most foreign football fans will visit Poland and Gdańsk for the first time. Many will be ordinary people but the fans will also consist of businessmen. We’ll use the occasion to show that Gdańsk is a good place to invest in. I hope this will encourage many to return here afterwards. ::

From left: Ryszard Trykosko, President of the Euro Gdansk 2012 Investment Office (GIK) , Martin Kallen, the UEFA Euro 2012 Operations Director, Maciej Lisicki, Deputy Mayor of Gdańsk. 8 March 2011

Maciej Lisicki, Deputy Mayor of Gdańsk and Martin Kallen, UEFA Euro 2012 Operations Director. 8 March 2011

PGE ARENA GDAŃSK Capacity 44,000 seats Dimensions 236 × 203 × 45 metres Site area 33.9 ha Useable space 36,600 m2 Project RKW Rhode Kellermann Wawrowsky

Construction time 2008-2011 Construction cost PLN 645 million UEFA EURO 2012TM Three group matches and one quarterﬁnal to be played there

76 ::

polish market :: 3/2011

EURO 2012

A European-standard project How is the real estate market developing in the Tri-City of Gdańsk, Gdynia and Sopot? Will the forthcoming football tournaments change anything in this sector? An interview with Sławomir Gajewski, President of TORUS Sp. z o.o., leader of the real estate market in the Tri-City.

investors. As an active developer we support the initiative of the Pomerania Development Agency and the Investor Assistance Centre operating within its structure. We are convinced that its staﬀ with their expertise, ideas and positive energy is capable of assuring the highest, European-level standard of services.

What in your view is the present condition of the real estate market in Gdańsk? Following a drastic slowdown caused by turbulences on world markets in 2009, our local market is on the way to balance. In the oﬃce estate sector, in which Torus is the leader, supply and demand are nearly balanced. Much oﬃce space of various classes was completed and is available on the market at once. That enforces natural competition.

What were the main factors that such renowned companies as GE Money, First Data and Deloitte have chosen the Arkońska Business Park in Gdańsk as their seat? Surely, the main reasons were the quality of our buildings and the mostup-to-date technological solutions that were applied. The Business Park project is of a high European standard in every respect and allows companies ﬂexible planning of space and assures the safety of staﬀ and data. These are both of the highest value nowadays. The location of the Arkońska Business Park has also been an asset.

How do you assess the position of the Tri-City in terms of real estate sales? We are in the lead among cities offering very good living conditions for their inhabitants. We have to keep in mind, however, that the Tri-City faces a strong competition. Kraków and Wrocław have out-distanced us somewhat and it will be very difficult for us to keep up pace. Yet, the Tri-City has an immense potential to take the leadership position among cities whose importance has been consistently growing in recent years. These are fi rst of all Poznań, Katowice,

Sławomir Gajewski, President of Torus Sp. z o.o.

Szczecin, Łódź, and even Rzeszów and Bydgoszcz. It is therefore crucial to invest in promoting the Tri-City and the Pomerania region. The Tri-City has to have a central unit responsible for providing a comprehensive range of services for

Do you think that the imminent Euro 2012 football championships in Gdańsk will have an impact on real estate prices and change the market in any way? My answer is a straightforward no! Euro 2012 will altogether last just three weeks. In the short term, hotel and guest house owners and operators will surely reap proﬁts as they will certainly adjust prices to the immense demand during the football championships ﬁ nals. ::

3/2011 :: polish market ::

EURO 2012

Valuable experience Interview with Dawid Szpinek, commercialisation aﬀairs manager at the Euro Gdańsk 2012 Investment Oﬃce (BIEG)

Th is month BIEG played host to Martin Kallen, the UEFA Euro 2012 Operations Director. How did Martin Kallen assess Gdańsk’s on-going preparations for the 2012 European Football Championships? Yes, Martin Kallen, the UEFA Euro 2012 Operations Director, and Frantisek Laurinc, an UEFA Executive Committee member and the UEFA president’s delegate for EURO 2012, visited Gdańsk on March 8. They were both greatly impressed with the construction of the PGE Arena sports stadium. Gdańsk’s preparations for the UEFA EURO 2012 tournament were then discussed in great detail pertaining in particular to road infrastructure, transportation, safety and security, emergency medical services, fan zones, volunteer staﬀ as well as civic programmes accompanying the event. Martin Kallen was most satisﬁed with what he saw and the ongoing preparations of the city for the European Football Championships. What represents the biggest challenge for BIEG 2012 just one year before the championships? The biggest one is to ensure that PGE Arena is ready on time and that it will assure absolutely perfect conditions for the championships to take place

CURRENT EVENTS In March 2011, UEFA Euro 2012 Operations Director Martin Kallen, together with UEFA Executive Committee member and UEFA president’ s delegate for EURO 2012 Poland and Ukraine Frantisek Laurinc, visited football stadiums in Gdańsk, Poznań, Wrocław and Warsaw. The guests assessed the advancement of work in the construction of the stadiums and the state of preparations for the

78 ::

polish market :: 3/2011

without a hitch and in an exemplary way. The stadium will be in operation for one year before the championships and that will give us the opportunity to learn things, streamline procedures and logistics, check the eﬀectiveness of crowd control measures as well as safety and security measures during mass events. How do you assess the impact of the Euro 2012 sports events on the further development of the city and the surrounding region? Entrusting Poland and Ukraine with the task of organizing the UEFA EURO 2012 tournament provided no doubt an incentive for major investment ventures in the country. Furthermore, the organization of such a prestigious and formidable tournament has also given organisers a unique opportunity to win most valuable expertise, for example in coordinating vast undertakings on a national scale as well as in provinces and Euro 2012 host cities and that all in the framework of international cooperation. In its direct neighbourhood, the erection of the PGE Arena Gdańsk sports stadium has opened a new chance for the Gdańsk district of Letnica where it is built. Th is rather

UEFA EURO 2012 tournament pertaining in particular to road infrastructure, transportation, safety and security, emergency medical services, fan zones, volunteer staﬀ as well as civic programmes accompanying the event. During Euro 2012 Fan Embassies will be set up in cities hosting the European Football Championships. These will provide fans practical information and advice – in their national language – as well as support in emergencies.

tumbledown part of the city as it is now will soon get a new breath of life. Several dozen million zlotys have already been allocated for its revitalization. More things are to come in the stadium’s direct vicinity changing the city’s landscape for years to come. The International Fair in Gdańsk will move its seat to nearby. Modern and spacious exhibition halls will be put up over an area of 12,000 sq.m. A conference centre will be built. Part of the plot occupied by the stadium will be assigned for ofﬁces and hotels. As a result, a modern business, entertainment and recreational centre will emerge. What is planned by BIEG 2012 to encourage people to visit the PGE Arena football stadium in Gdańsk once Euro 2012 is over? PGE Arena Gdańsk will be used for mass events, including sports games and popular concerts. To attract inhabitants to the stadium, guided tours will be organized of the premises. A professional roller ring will be set up around the stadium and connected with cycle routes running picturesquely along the sea shore from Gdańsk to Gdynia. The stadium will accommodate a pub, an exclusive restaurant and a museum devoted to the Lechia Gdańsk sports club. 9,000 sq.m. of the premises will be used for shops and services. The opening is planned of a big Lechia shop, as well as of a ﬁtness club, a kids-park and a leisure centre. ::

Alan Aleksandrowicz President of the Gdańsk Economic Development Agency Ltd. The most important economic consequence of Euro 2012 has been the unprecedented speeding up of investments in transportation infrastructure. Roads built for Euro 2012

have already increased the inﬂux of direct investments today. The improvement in Tri -City’s communication links with the rest of the country will boost the competitiveness of local companies. Employment will rise and so will tourist revenues. The event will help to promote knowledge of Gdańsk and of Poland generally among people in other countries.

EURO 2012

Investments stimulate growth What guides investors in selecting real estates? What is the oﬀer for foreign businesses from one of Poland’s leading developers? These are the issues commented by Halina Gniadecka, adviser of the Management Board of Allcon Investment S.K.A.

What in your view is the importance of the UEFA Euro 2012 tournament as a growth-incentive for Allcon Investment in the Tri-City? Allcon Investment is a developer of commercial estates, and in recent years exclusively of office premises. Euro 2012 has become a crucial driving force in the development of our company as for the whole Pomerania region. The construction of the new Słowacki Street connecting the Gdańsk-Rębiechowo Airport with the sports stadium and the on-going execution of the Pomeranian Metropolitan Railway project stimulated in a direct way the development of the ALLCON@ park office area situated in the vicinity of the airport. The new railway route runs along the boundary of the Łużycka Office Park in Gdynia and as such boosts the value of its location. The increase in the number of hotels in preparation for Euro 2012 has also been a factor that has frequently prompted foreign investors’ decision to locate their companies in the Tri-City. What does the company offer to foreign businesses? The Łużycka Office Park and ALLCON@ park have been designed mainly for the

needs of investors in the BPO (Business Process Outsourcing), R&D (Research Development) and IT sectors who seek ideal locations for their branches throughout the world. These two office parks offer between them more than 40,000 sq.m. of net office space. The two first ALLCON@park buildings were constructed on the “builtto-suit” basis for the Polish branch of INTEL. The latest office building in the complex has already become a multilease project developed following the expansion of Intel and Young Digital Planet (another IT company) seated nearby. Some 3,000 sq.m. of office space in ALLCON @ park is still available for rent. The Łużycka Office Park comprises five A-class standard office buildings. Attractive location, the project and modern technological solutions have attracted major foreign companies including Geoban, Nordea and Sony Pictures. The fi fth building was bought by Det Norske Veritas, one of the world’s leading classification societies, for its own needs. About 7,000 sq.m. of office space in the complex is still available for rent. Another 7,000 sq.m. will be offered in a new Łużycka Plus office building erected near the complex. An important aspect of our company’s offer for foreign businesses is ecology. Assumptions of sustainable development in commercial projects have been implemented by Allcon Investment in its commercial projects for several years. The company is a member of the Polish Green Building Council. The ALLCON@park 3 energy efficiency building and one building in the Łużycka Office Park complex have been placed on the prestigious

European Green Building Programme list. The new Łużycka Plus Project will be submitted for BREEAM certification. What were the factors that account for the many awards won by Allcon Investment? Professionals in the commercial real estate business and tenants in the Łużycka Office Park acknowledged our care for high standard of office buildings and comfortable working conditions. Thanks to their highly-appreciative opinions that office complex was ranked at the top of the best office buildings in Poland. The tenant assessment study was carried out at the end of 2010 on behalf of Eurobuild by the Polish branch of the international Milton Brown Company specializing in market research. ::

3/2011 :: polish market ::

EURO 2012

We want people to identify with MZA Interview with Mieczysław Magierski, President of Municipal Bus Company (MZA) in Warsaw

Warsaw is changing and is becoming a more and more modern metropolis. Is MZA also undergoing the process of modernisation? Our priority is, of course, public transport. In this area the company is a strategic enterprise for Warsaw. MZA employs nearly 5,100 employees, of which 3,650 are drivers. Today, however, the activities of the company

largely extend beyond the area mentioned in the statute. We are becoming a multi-function company, clearly connected with the urban community. Certainly, in recent years, we have changed the way our company is perceived. For many years, MZA was associated with a wrecked bus with a bored driver in it... To put it shortly, we want people – both passengers and employees – to identify with MZA... To feel that MZA is their company – a company with traditions, but at the same time as modern and safe as bus companies in other capital cities of Europe. Next year Warsaw will be one of the cities hosting the Euro 2012 football tournament. Does this involve new challenges for MZA? The tournament is a great event for us. Due to this fact, MZA has undertaken a number of actions. :: Due to launching our own Education Centre we could start a number of training sessions, including foreign-language courses for our drivers. Since we are going to host many tourists from outside Poland, it is necessary for drivers to be able to give foreigners various tips concerning transport. Our staﬀ has had the opportunity to learn English already since 2009. :: “The fan” project will be carried out till Euro 2012 in co-operation with the police. It will consist of 18 training courses addressed to lower secondary school students who will be taught how to behave in the stadium and on the buses. :: Let us not forget about children. We are preparing special lessons on the safe use of urban transport for our youngest passengers. :: We plan to present short reports from the games, especially those with the participation of Poland, and to report results, various interesting facts concerning football, chronicles on Warsaw and educational ﬁlms on the subject of safety,

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language courses, and so on in our buses. :: Our cooperation with the city’s Crisis Management and Safety Department, headed by Ewa Gawor, also is of significance. In the event of danger, we are responsible for people’s evacuation. At any one time, a group of 150 mobilised drivers is on 24-hour call. We are the only company in Poland which has a bus for transporting multiple stretcher patients. We confi rm our efficiency in the regular trial evacuations of hospitals or the National Stadium, anti-flood actions, and during trials by the police Antiterrorist Operations Bureau. We are constantly improving our skills, so during the tournament we will be ready to serve the city and its residents. Speaking of MZA being rooted in the city, it is impossible not to ask about your cooperation with the city authorities. The Warsaw authorities positively support public transport, which is reflected in more and more kilometres of separated lanes for buses or in extending the reach of buses. A multiannual agreement concluded between the city and MZA certainly serves as a guarantee of fi nancial stability for the company, and makes it possible to purchase increasingly modern buses and to modernise the infrastructure. The investments mainly involve investments in new fleet? Changes are visible every day on the streets of the city, as MZA is regularly modernising its fleet. In December 2009 the city concluded a longterm agreement which guaranteed the provision of transport services for the residents of Warsaw in the years 2009-2017, and at the same time it included the purchase of 660 new buses. The total value of the agreement was nearly PLN6 billion! Our new buses are air-conditioned, adjusted to the needs of the disabled, and equipped with LCD monitors. In 2011 we can expect 168 more new vehicles. According to our plans, after the summer holidays, apart from 56 10- and 12-metre-long buses, 112 articulated buses will appear on the streets of the capital city, including 2 metrobuses - vehicles with a length of approx. 20 metres, and 4 hybrid vehicles, powered

EURO 2012 both by diesel oil and electric energy. Warsaw will be the fi rst city with that many hybrid vehicles. In order to improve the comfort of passengers, the buses will be low-floor vehicles and will be adjusted to the changing weather conditions. Safety issues will play an important role; as a standard, we have introduced the factory assembly of fi re systems, which in the case of any failure, health or life-threatening situations, will minimise the risk nearly to zero. In the middle of February, there was an official opening of envelopes with tender bids, and now the procedures associated with their assessment are being implemented. There are also plans concerning a large investment in the area of the headquarters of MZA in Warsaw… In the previous year we modernised the “Ostrobramska” depot. Th is division completely changed its appearance and is a model for the reconstruction of other MZA facilities. Today our priority project is the construction of the office and conference centre at Włościańska Street. Th is mainly involves the reconstruction of the building of the industrial hall into a modern three-floor office facility, housing registry offices, the spokesperson’s office, the board and the lawyer’s team’s office. The building will include a very modern transport management centre where our employees will have the opportunity to watch the current bus schedule, to react to crisis events online, and to directly manage the movement of vehicles in the city. Currently, we are at the stage of announcing the tender procedure for the implementation of the design. Th is will be one of the most beautiful and functional office buildings. The author of the project is Tomasz Kwieciński and his architecture studio Grass. It is said that it is possible to make a career in a truly American style in MZA – from a driver to a member of the board... What is the role of investing in staff skills? Yes. Each of my employees is special. We have a poet, a football referee, model makers, teachers, martial arts instructors, journalists. The career path in MZA is transparent. A driver has the chance to become a manager, an inspector can be promoted to the position of a director, or even a member of the board. We do whatever is

possible to provide employees with a sense of stability and we invest in qualifications. We have introduced a training system concerning dealing with crisis situations. Th is is a pioneer programme implemented on such a scale only in MZA; 1,500 employees have been trained so far. The essence of the training is to be prepared for taking actions making it possible to diff use tension and to learn how to behave in stress situations. We teach our employees how to solve problems in a way which does not expose passengers to danger. In the case of other trainings which are aimed at constant qualification improvement, we have signed agreements with prestigious higher-education institutions offering educational packages in many fields of study. Our employees can supplement their education with benefits for themselves and for MZA. We provide our employees with a wide range of team-building activities. For decades we have organised an annual event for our staff. Gifts in the form of branded Swiss watches for employees celebrating their 30-year jubilee of working in the transport industry are an unchanging element of the event. Th is is just a symbol, but with great importance... Last year we organised a picnic for several thousand people, which was attended by our employees, together with their whole families. Every year our employees play in the company football league; we also have a runner who represents us in many cities and towns in marathons and street runs. Let me repeat: we want people to identify with MZA. Also the students of Warsaw universities… Our company realises that people are its greatest asset. Therefore, apart from the constant employee development, we provide the best students and graduates of Warsaw universities with the opportunity to gain experience in our company. In this respect, we cooperate with the Warsaw University of Technology, Koźmiński University and the Academy of National Defence. The company cooperates closely with the Warsaw University of Technology, funding prizes for the authors of the best seminar papers at the Faculty of Automotive and Construction Machinery Engineering. Th is is a result of an agreement concluded in April 2008

M. Magierski receives the Koźmiński University “Eagle of Success” Award

MZA – the prize winner In the previous year the jury for the 5th edition of the “Eagles of Success” competition organised by Koźmiński University granted “The Eagle of Success” prize in the category “Postgraduate studies and MBA alumni” to President of MZA, Mieczysław Magierski, for the utilisation of theoretical knowledge in practice. The Koźmiński “Eagles of Success” competition has the purpose of distinguishing graduates who have achieved spectacular professional success and whose career path can serve as a model for university students and other alumni. The competition is run in two categories: “University studies alumni (Bachelor’s or Master’s degree)” and “Postgraduate studies and MBA alumni.” It is organised every year in the spring, and the winners receive their “Eagles of Success” statuettes during the inauguration of the new academic year. Municipal Bus Company (MZA) was also honoured in November of last year with the title of “The Pearl of the Polish Economy.” This title was granted to the enterprise in the category “Large Pearls” in the 8th edition of the ranking organised by the “Polish Market” magazine with cooperation in the ﬁled of methodology of the Institute of Economic Sciences of the Polish Academy of Sciences (PAN). The company also won the prizes “Dependable employer in Mazovia 2009” and “Dependable employer in the urban transport industry 2009.”

between MZA and the University. Student placements, in turn, are a perfect opportunity for gaining professional experience and employment in the future. Practising students in our company are treated as equal to the employees. They are allocated their set of duties and responsibilities for which they are accountable. We oﬀer two types of placements: free placements – 2, 3 times a week, and paid placements, which I would call unique on our market. We guarantee the students the possibility to quickly confront their knowledge with practice. We do it because we would like to prevent situations in which engineers after graduating choose diﬀerent professions instead of staying in the industry. Interview: Maciek Proliński 3/2011 :: polish market ::

Investment Processes

III INTERNATIONAL ENERGY EFFICIENCY FORUM

LESS MEANS MORE 31 March 2011 (Thursday) – 1 April 2011 (Friday), Warsaw Energy efficiency is profitable in many respects. It brings about a reduction of production costs, increase in company profits and product competitiveness and, indirectly, improved living standards of citizens. Moreover, the construction of highly efficient power plants and CHP plants, reduction of transmission losses on the grid as well as integrated supply and demand planning bring benefit to the economy by accelerating its development.

A good example from the Polish market: General Motors factory in Gliwice. During 5 years (2003-2008) energy consumption was reduced by over 50%, setting a record in the Group.

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Poland’s activity in the field of energy efficiency is driven not only by the desire for economic benefit but also by international commitments and regulations. As a result, legislative framework has been established for measures aimed at energy efficiency increase and promotion of innovative technologies reducing harmful impacts of the power sector. The framework is contained in the draft Energy Efficiency Act adopted by the Government in October last year. The main objective of the document is to

polish market :: 3/2011

determine the methods of implementing the system of white certificates on the Polish energy market. Issues related to energy efficiency are among the key problems faced by the Polish economy. The Forum will consider steps to be taken to intensify pro-efficiency measures and will present the situations in Poland, France and Great Britain. Our foreign experts, using the knowledge and experience of countries where energy efficiency laws together with white certificate systems have already been implemented, will

be asked to share their opinions and experience. The Energy Efficiency Forum will last two days. Day one will focus on the Energy Efficiency Act (under debate in the Polish Parliament) and on energy efficiency in the construction sector. Day two will include a thematic block on energy efficiency in transport: road transport cost optimisation through elimination of bottlenecks in road traffic, and costs of public transport (trams, buses, underground and railway). The Forum is expected to gather about 200 participants, including high-profi le representatives of the Polish government, Polish President’s Chancellery, Mayor of Warsaw and President of Polish Energy Regulatory Authority, as well as international experts from Italy, France and the UK, representatives of European Commission’s DG Energy and Polish National Energy Conservation Agency, and Members of Parliament from Poland and other EU member states. ::

Real Estate

The Polish property investment market vs. Central and Eastern Europe markets Anita Rajchelt

Senior Surveyor. Capital Markets Group, Cushman & Wakeﬁeld

Compared to the previous year, 2010 was much better for the property investment market in Central and Eastern Europe in terms of both the volume and the value of transactions made. The value of investments on the commercial real estate market totalled approx. EUR 7.8 billion and was up by 58% on 2009. The strongest growth in investments (215% compared to the previous year) was recorded in the sector of retail properties, while investments in the office sector enjoyed the largest market share of approx. 48%. The total value of investments in Poland recorded an extraordinary increase of over 3.25 times its value in 2009 and reached approx. EUR 2 billion. Of this value over EUR 1 billion accounted for transactions in the retail properties market and approx. EUR 620 million accounted for transactions in the office sector. Forty-eight transactions were made in the Polish commercial property investment market, of which the largest, not only in the Polish market but in the entire region, was the takeover of Simon Ivanhoe’s European portfolio comprising the shopping centres Arkadia and Wileńska in Warsaw for approx. EUR 700 million by UnibailRodamco. The value of this transaction reached over EUR 400 million. The second largest deal in the Polish market was the purchase of the Europolis company holding majority shares in six office buildings in Warsaw for the estimated total value of over EUR 230 million by CA Immo. The transaction will be completed in Q1, 2011. Other major transactions included the purchase of a 75% share in Galeria Malta in Poznań by the American fund Heitman and the purchase of Horizon Plaza in Warsaw for over EUR 109 million by Union Investment. By contrast, out

of the twenty transactions made in the Czech Republic one of the largest was the sale of the office building City Emperia by EVM to Generali PPF for the total value of EUR 71.5 million. The analysis of the Romanian and Hungarian markets reveals that the number of transactions there was similar: thirteen in Romania and eleven in Hungary. One of the major transactions in the Romanian market was the purchase of the office building in Bucharest from Portland Trust for EUR 101.2 million by New Europe Property (NEPI). In Hungary, on the other hand, Allianz acquired the shopping centre Allee in Budapest for EUR 105 million. Poland has become one of the most popular countries for capital investments in the Central and Eastern Europe region. However, on account of the insufficient supply of good quality properties and the pursuit of higher rates of return, investors are now beginning to target less mature markets such as Russia or Turkey.

Ten major investment directions in CEE The analysis of the above transactions clearly shows that the demand rose from both local and foreign investors. The investment activity continued to be limited to a certain extent because of the restricted access to ﬁnancing, but the main obstacles to the conclusion of a larger number of deals was the limited supply of attractive properties as well as the excessive and rather unrealistic expectations of some property owners. In Poland last year’s demand was dominated by German and Austrian players whose share in the total volume of transactions reached over 85%. The most active investors in the Polish market included: Atrium, AEW Europe,

Commerzreal, IVG, RREEF, SEB, Unibail-Rodamco, Union Investment and the Spanish fund Azora. In the Czech Republic, the Czech investor CPI was very active, while Hypo Real Invest and Generali PPF also made their presence seen in the market. Allianz and Erste Bank were very active in Hungary, while in Romania it was GTC and NEPI. In general, the rising demand for properties throughout the Central and Eastern Europe region translated into an increase in their prices measured by yields. In the Eastern markets yields for office and warehouse properties fell by over 100 basis points, while yields for retail properties dwindled by approx. 50-75 basis points. In Central Europe yields declined more moderately, by approx. 40-60 basis points in the case of retail properties and 30-40 basis points for office and warehouses. In Poland prime yields are estimated at 6.5% in the office and retail sectors, and approx. 8.5% in the warehouse sector. The investment activity is expected to intensify further in CEE in 2011. Yields in some markets may continue to fall slightly because investors’ demand for prime space exceeds the supply. Numerous negotiations currently underway are an optimistic sign for Poland, which may lead to an increase in the volume of transactions and a further slight compression of yields. However, this decline in yields may apply solely to prime properties. In the case of secondary properties which are older, less favourably located and with shorter leases, yields will remain at a stable level or may even rise slightly, which results from the fact that investors will want yields to reflect the risk connected with the limited demand of tenants for such properties. :: 3/2011 :: polish market ::

Engeenering and Construction

Construction: waiting for better times A successive Polish Construction Market and Construction Prices in Surveys and Statistics – 2011 meeting hosted by the Construction Academy Foundation (Fundacja Wszechnicy Budowlanej) and the Centre for Economic and Organizational Implementations in Construction – OWEOB Promocja-Sekocenbud summed up the current situation on the construction market.

According to one of the speakers, Professor Zofia Bolkowska, infrastructure construction, expected to be the powerhorse of the construction branch, booked no growth at all over recent months. Most successful in this situation are micro-businesses employing up to nine people. Although such units are not covered by Poland’s Central Statistical Office (GUS) surveys, they are nonetheless quite apt at fi nding sales niches in various segments of the market. According to Professor Bolkowska,

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although January is usually a lowoutput month, this year’s relatively good weather and the large arrears in construction work had given hope for a higher output, especially in the infrastructure sector. Bolkowska noted that construction output this January rose 11.2%, but the increase was from a very low figure in January last year (15% down on January 2009). She also pointed out that January production in companies employing from 10 people upwards was almost 70% down on previous months. According to Bolkowska, the outset of a year in the construction branch is always untypical and the exceptionally bad weather conditions in January 2010 seriously limited construction work, making data comparisons difficult. Because of this, Bolkowska noted, the percentage rise in production in January of this year against the low production figure in January 2010 cannot constitute a sound measure of actual change. On the other hand, developers and private investors are investing more and more in housing, although this does not translate into more homes handed over to users. Bolkowska predicted that the coming months might see a rise in home completions if the current investment boom carried on. Quoting GUS, she said that in January of this year construction was launched of 40% more homes than last year (34% more individual and 54% more development companies’ projects). Similarly as in the previous year builders polled by GUS feared

the effects of heavy winter weather in 2011. Asked about growth barriers in construction 60% named bad weather conditions, about 40% waning demand. Those surveyed also complained about excessive employment costs and competition, but did not mention organizational or fi nancial problems. In January of this year employment in construction rose by 7.6% against 2010, average wages 4.2%. Also recorded was a slight rise in construction prices (0.2%). Grzegorz Ordyniec from the Provincial Statistical Office in Lublin pointed to the steady rise in private construction around big cities, especially since 2001. In 2009 one in five private housing projects belonged to this group. Figures quoted by Ordyniec showed that this trend was especially visible in comparisons between the number of projects fi nalized in the suburbs of provincial capitals and in the cities themselves. In 2001 suburban projects had a relatively small upperhand of around 15%, in 2003 the figure was already 70% and in 2009 – almost 150%. Zbigniew Bachman, the meeting’s moderator and President of the Construction Academy Foundation, noted that everything depended on infrastructure around large urban centres. The better it is, the more people will want to move from congested city centres to suburban homes. The situation in cement production looked quite optimistic. In January 2011 Poland produced nearly 596,000 tonnes of cement, more than double the 2010 result (247,800 tonnes). Sales were even better – 610,100 tonnes against 229,700 tonnes in January 2010. However, January’s production was lower than in the previous year (700,00 tonnes). Also low were exports of cement and clinker. Th is, however, did not hurt the branch much as only small quantities of both products are sold abroad. The meeting was graced by a birthday cake from the renowned confectioner Blikle to mark the 20th anniversary of the Atlas Group, one of the meeting’s organizers alongside the Polish Steel Distributor Union, the ASM Market Research and Analysis Centre and the Warszawskie Przedsiębiorstwo Geodezyjne land surveying company. :: Compiled by Patryk Mirecki

Powerful Businesswomen

The woman of success Nina Kowalewska-Motlik, the head of New Communications, a strategic, marketing and PR consultancy company, talks to Rita Schultz.

Your knowledge and experience place you among the most influential managers in Poland. What, in your opinion, has contributed to your success – education, personality or luck? I must say I feel very privileged as coincidence and luck played a dominating role in my professional life along with personality. I have a degree in Japanese studies and it was coincidence and history which decided that I would never work in my profession. It was 1982 (martial law) and I was not willing to comply with the official conditions which would need to be fulfi lled for me to be allowed by the regime to work for a Japanese journalist. I decided to become a radio journalist instead without any special conditions. The next steps were pure coincidence – meeting the right people, being at the right place at the right time. I just had to show I was capable of the tasks put in front of me. I think I have the ability to motivate people and have always felt responsible for the development of my staff. You seem to like to be a pioneer on the Polish market – you have introduced pocket editions of romance novels, you are the sole representative of CNN, “Financial Times” and “The Economist”. You are also the face of Superbrands – do all these activities and ideas come easy? I think that we are all brands and by everyday actions we defi ne ourselves and create an image. I could say it was pure coincidence that I have become the exclusive representative of the top media titles in the world, but it is fair to say that the success of one created the interest of the next one. If you are honest and consistent, your efforts are noticed and rewarded. Who is your greatest influence in your professional life? I am a big fan of Tom Peters who is incredibly empowering and wise. He gives guidance for life and I am always very

impressed. I am also very grateful to my friends at Club 22 who have shown me over the last 20 years that women should support one another. Superbrands promotes brands. The names of the strongest brands in Poland were announced for the fi fth time last year. How does the title benefit its winners? Superbrands is the only title of recognition of quality and position which is given by independent experts to the often anonymous groups of marketing people who work hard for years on building the position of the brand. Th is is their award. For consumers Superbrands is a stamp of quality which is important in their purchasing decisions and confidence. What do you think should be done to promote Poland? What is the right direction? The promotion of Poland is a complicated issue. We don’t have a single, clear and obvious USP - unique selling proposition, like the climate, sun or snow or special products or services. Poland is a country without special differentiating features. It is therefore very important to promote Poland through showing the various sides of Poland and the different offerings. The important thing is for the efforts and actions to be coordinated. As I mentioned at the beginning of our conversation, you are an excellent manager. Does a female management style exist? A female management style does exist but is as different as women themselves. There are women who are tyrants as there are women who are very gentle. I think I am a good person and try to be a fair and motivating boss. ::

Nina Kowalewska-Motlik has been involved in the advertising market since 1989. Was the General Director and President of the Young & Rubicam Poland agency from 1995 to 2000. Is currently president of New Communications, a strategic, marketing and PR consultancy company. Sole business representative of the Financial Times and The Economist groups, G+J and CNN Television as well as partner of the Superbrands organization. A branding and national marketing expert.

3/2011 :: polish market ::

CEOs after hours

interesting takes. It was just a small step from there to photography.

Andrzej Krzemiński President of the Management Board of EFL Photography has been your passion for years… How did this interest come about, is it the desire to capture the moment? This interest “just happened.” I don’t know what has started it, but I suspect that it has been with me for a long time. Maybe my father passed it on to me ages ago, together with a Zorka camera, maybe a friend from secondary school, who had his own darkroom. At some point in my life I realised that the world is made up of pictures, that an interesting frame can be “cut” from everything what we see, you can ﬁnd fascinating light, texture, colour. I started to look at the surroundings and found such

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In your opinion, is equipment used to take photos important? What is your favourite brand? Talking about equipment is a neverending debate of the superiority of brand X over Y, reflex over compact, digital over standard photography. Today’s cell phones produce pictures with a resolution several times greater than the Minolta 7D – my first digital reflex camera years ago. I remember my consternation when a friend recently asked me for advice: which digital camera should he buy for his wife to begin her photography hobby – my mind was blank and I had to quickly look through the Internet in search of an answer. Picture quality (colour, sharpness) is mostly created by the lens, from which, or rather from an appropriate assembly of lenses, one should start. If you attach a random, cheap lens to a camera that costs as much as a small car then the result will be a lousy picture. The opposite may be OK, provided that the camera is not from the bottom-most shelf. The presentation of our work is also important: in low-resolution on a networking site or “stretched” to an A0 format at a display. In the former case a simple camera is enough, for the latter, the resolution of the matrix and the quality of the lens will be of fundamental importance. I know that good pictures cannot be taken without mastering a lot of knowledge that governs this profession. Knowledge and thousands of taken photographs, including thousands of thrown-away ones, make up

a photographer and also that dozen of frames that you can be proud of for years. Moving from analogue photography to digital, I bought Canon’s equipment and that’s how it remained. What do you like to photograph the most? People’s faces, especially when it is not a posed portrait. I once took a bad beating from a woman at a bazaar in Morocco when I pointed my lens in her direction. There are a lot of beliefs that taking a picture takes the soul away from a person. I like hunting for souls. Have you thought of exhibiting your pictures, or maybe you have already done so? I am full of criticism regarding what I do. I think that I would be afraid to organise an exhibition and invite strangers to it. Not because they may criticise me and judge the work to be average but because I might disappoint them instead of satisfying. This is still more of an internal passion than a means of reaching outside. I have my own Internet webpage where there are dozens of pictures arranged according to theme. When do you ﬁnd the time for your passion, since photography is not your only hobby? I get involved in my non-professional interests during my non-professional time. I do not have much of it hence I consider it a good month when I can say: you’ve managed to get a couple of good shots. And that’s how it will surely remain. ::

Cultural Monitor

To comprehend the past and look forward

The Best ASP Graduation Work 2010

The Academy of Fine Arts in Warsaw (ASP) is the oldest artistic academic school in Poland. It was established in 1904 as a private institution under the name of “The School of Fine Arts” at the initiative of individuals committed to the arts. Today the Academy comprises seven faculties. These are faculties of Painting, Sculpture, Graphic Arts, Art Conservation and Restoration, Interior Design, Industrial Design and (as of September 2009) of Media Art and Stage Design. The ASP enjoys high reputation in the country’s artistic environment. Its graduates encompass renowned artists such as Paweł Althamer, Zofia Kulik, Mirosław Bałka and Katarzyna Kozyra, whose output has influenced the shape of arts in Poland and abroad. The Academy’s teaching staff is made up of prominent personalities including painters Leon Tarasewicz and Jarosław Modzelewski, sculptors Adam Myjak and Janusz Pastwa as well as designers Jerzy Porębski and Wojciech Wybieralski. Drawing from its tradition, the ASP opens itself up in an interesting way to the future. Organisers of the second edition of the “COMING OuT” exhibition of the best ASP graduation works of 2010 commented: “We are leaving the school walls to merge into the urban structure… We reveal who we are. We demonstrate what we can do. We are trying to draw the general public’s attention to the young and skilled graduates of the Academy.” This year the “COMING OuT” exhibition was staged in the Terminal A Departure Hall of the International Frederic Chopin Airport in Warsaw. Last year graduation works were shown in the former deserted seat of the Veterinary Institute, now the headquarters of the Sinfonia Varsovia Orchestra in the Praga District of Warsaw. Summing up this year’s event, Paweł Potoroczyn, director of the Adam Mickiewicz Institute, observed: “Polish artists have

consistently given proof that they are part of the world elite. In this context the exhibition is artistically and intellectually a promising augury for the presence of successive generations of young Polish artists in the international mainstream.” Exhibitions of this kind have in a new but also inconspicuous way promoted ASP students graduating from the Academy. It is noteworthy that students’ projects are ever more frequently bought and implemented by businesses. ASP students collaborate with companies, receive sponsored scholarships for studies abroad and sign work contracts even before graduating. Ksawery Piwocki, the ASP rector, says: “Our Academy deals with companies, including medium-sized ﬁrms and big groups, private as well as state-owned, and that several hundred times during the year. These contacts provide a good platform for interesting and creative activities, works and encounters. They are an advantage for our students. They help to promote companies, serve the city and contribute to the economy. Teaching in our Academy does not boil down to passing practical skills and theoretical knowledge. Apart from ingraining students with craftsmanship skills, we want our graduates to become creative and socially-matured individuals. We want them to feel members of the intellectual elite. Apart from teaching students the skills of the craft and whatever is related to it, theory is of course the second major element of educating ASP students. That, however, is not just the theory of the arts. An artist should be well versed in contemporary world aﬀairs and understand what’s going on. He or she should be inclined forward, yet at the same time understand the meaning of the past. This is of paramount importance in the arts. An artist has to comprehend the functioning of the arts market which is now open to the whole world, but primarily to Europe. Nobody can manage in arts trade (let’s not be ashamed of using that word in this context) without a good merchant and his assistance. Especially so on the international market. I am sure of one thing: the toil of tutoring at the Academy is geared at bringing up people with an education and professional skills that will bring them into the elite of the society,” Ksawery Piwocki adds. Maciek Proliński 3/2011 :: polish market ::

Cultural Monitor

Compiled by Maciek Proliński Regina Carter – the best jazz violin player in recent years – arrives for the only, exclusive Jazz Era (Era Jazzu) concert, that will take place on 14 April in the Palladium club in Warsaw.

The well-known Polish opera singer Marek Torzewski has recorded a new album – ”L’Amore” – with popular Italian love songs. It was released on 8 February by EMI Music Poland. “One of the reasons is that my wife and I have recently been celebrating our 25th wedding anniversary. We both are romantic, we love Italy and it was the ﬁrst country we visited together. I wanted this album to be a gift for my wife, my daughter and myself too. I also wanted to share the energetic pulsation that can be found in this music, its scent of sea, sun and love. On the album there are songs as old as 50 or even 60 years, and have still not lost any of their popularity. Songs like ‘Che Sera Sera’ or ‘Volare’,” said the Polish tenor who has been living in Belgium for many years now. He debuted in 1985 in Teatro alla Scala in Milan, conducted by Claudio Abbado. In 1986 he emigrated to Belgium and became a soloist at the Royal Theatre of the Mint in Brussels. He has performed on opera stages in Germany, France, Italy, Spain and Portugal. In 2009, he was awarded the “Polish Market’s” Pearl in the ﬁeld of culture, for “building the singing image of Poland in the world.” ::

On 23 March, the famous American movie director, Woody Allen, will play with his jazz band in Katowice Culture Centre. Allen – a huge jazz enthusiast – has been playing clarinet for many years, and regularly performs in one of New York’s clubs. The New Orleans Jazz Band concert will take place within the framework of the city’s eﬀort to become the European Capital of Culture in the year 2016. It will be the second visit in Poland of Woody Allen & His New Orleans Jazz Band. Previously, the artists performed on 28 December 2008 in the Warsaw Congress Hall. The music performed by the band during live performances reaches the roots of improvisation, the street carnival, wedding and funeral music – the traditional jazz sounds from New Orleans. The visit of Woody Allen will also be an event for moviegoers – a big review of Allen’s movies is planned. Almost all his movies, from various stages of his career, will be screened in Katowice. ::

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The artist will promote her latest album “Reverse Thread,” recorded in cooperation with African musicians, including: Yacoub Sissoko, African kora virtuoso, base player Mamadou Ba and drummer Alvester Garnett. “Brilliant instrumentalist, the ﬁrst female jazz musician to play the priceless, over-200-year-old Cannone Guarnei del Gesu violin that belonged to the maestro Paganini himself. When in a concert, one has the impression that the violinist and her band have unlimited reserves of energy and musical associations, which allows a charming and funny way of winning audiences all over the world,” says Dionizy Piątkowski director of Jazz Era. ::

The 30th Jubilee Warsaw Theatre Meetings will take place between 1 and 17 April 2011, on the main stages of Warsaw. The last edition of the festival was cancelled due to the crash of the presidential plane in Smolensk. The organiser, the Theatrical Institute, has chosen the most interesting performances from Poland from the last two seasons. Apart from the main series of events, the Wałbrzych Fest, an overview of the achievements of the Szaniawskiego Theatre in Wałbrzych will be held, as well as performances for kids. We will also see performances produced by Polish creators abroad, i.e. “Messiah” (“Mesjasz”) by Małgorzata Sikorska-Miszczuk, based on the

work of Bruno Schulz, directed by Michał Zadara, prepared in Vienna’s Schauspielhaus, and “Streetcar” (“Tramwaj”) based on the play “A Streetcar Named Desire” by Tennessee Williams, from the Odeon Theatre in Paris, directed by Krzysztof Warlikowski, with Isabelle Huppert and Andrzej Chyra in leading roles. Warsaw Theatre Meetings are among the oldest theatre festivals in Poland, having been organised since 1965. Reactivated in 2008, after an eightyear break, it has gained huge audience recognition. The recent edition of the festival in 2009 attracted an audience of almost 8,000, who saw 23 plays. Also, 72 accompanying events took place (movie screenings, discussions, meetings, concerts). ::

Cultural Monitor The 15th Ludwig van Beethoven Easter Festival will take place between 9 and 22 April in Warsaw. During the jubilee edition, important and monumental works will be performed, i.e. “St John Passion” and “St Matthew Passion” by Johann Sebastian Bach and “The St Luke Passion” by Krzysztof Penderecki. Famous classical musicians will perform, i.e. Rudolf Buchbinder, Krzysztof Jabłoński, Lahti Symphony Orchestra, Württembergische Philharmonie and Dresdner Philharmonie, as well as professional Polish orchestras: the Polish Radio Orchestra, the National Polish Radio Symphony Orchestra Katowice, the National Philharmonic Orchestra, the Wrocław Baroque Orchestra and

Sinfonia Varsovia. Traditionally, there will also be an annual international musicological symposium and an exhibition of manuscripts in the Jagiellonian Library in Kraków. The Ludwig van Beethoven Festival has become an important element in the cultural life of Poland and Europe. The Festival’s initiator and art director is Elżbieta Penderecka. “Each year we gain new audiences, who divide their time between visiting Lucerne and Salzburg, where similar Easter festivals are taking place… I must unabashedly admit, that everyone is wondering how we manage to organise such a grand festival with so little ﬁ nancial resources,” says Elżbieta Penderecka. ::

In the Zachęta National Gallery of Art in Warsaw, there will be two interesting exhibitions that are especially worth seeing. The subject of the first one, exhibited from 8 May, will be the art of three female artists, pioneers of Polish female art: Ewa Partum, Natalia Lach-Lachowicz and Maria Pinińska-Bereś, who died in 1999. Since the 70’s they shared similar views, characterised by distinct feminist intuition or identifying with feminism. Their works, however, will be displayed in this configuration for the fi rst time. “The artists are part of the main movement in Polish modern art, their biographies are precisely analysed, their art is devoid of compulsion to reconstruct or supplement, but it seems not to be recognised beyond the professional circles,” says the exhibition’s curator, Ewa Toniak, PhD. ::

The second event, beginning on 15 May, is “Neo Rauch. Begleiter/Companion” a monographic exhibition by a German painter considered to be the main representative of so called “Leipzig School of Painting,” which debuted on the international scene in the ﬁrst half of the 90’s. The artist derives his subjects from the everyday reality of the socialist GDR. His paintings are in the permanent collections of MoMA and the Pompidou Centre. The Warsaw exhibition is one of few in recent years that showcases German art in Poland. There will be 30 works on the display, created in the years from 1993 until now. “Neo Rauch is excellent in discovering the human image in European mythology and expanding it on many diﬀ erent levels. His art displays features of past strong traditions in German painting – realism, expressionism and symbolism,” says the exposition’s curator, Joanna Kiliszek. ::

From 29 April to 5 June, in Łódź, there will be the 21st Łódź Ballet Meetings – the biggest and most prestigious ballet event in Poland. It will be inaugurated with the world premiere of the play “Meetings in two unfulﬁlled acts” (“Spotkania w dwóch niespełnionych aktach”) by Ewa Wycichowska – one of the most important persons in Polish ballet. These events showcase the choreography of prominent creators, i.e. George Balanchine, Maurice Bejart, Akram Khan and Gil Roman. Ballet groups arrive from Lausanne, Antwerp, or Milan. “Our audience will have the opportunity to see Balanchine’s ‘Jewels’ just after its world premiere in Milan,” says Marek Szyjko, director of the Grand Theatre in Łódź. “Another star of the meetings will be Sylvie Guillem. She will perform the play ‘Push’ with the choreography by Russell Maliphant. She began her career in the Paris Opera. She is the most prominent ﬁgure of classical dance, who devoted her skills to modern ballet. The best choreographers create for her,” Szyjko adds. During this year’s Łódź Ballet Meetings, a dance workshop will be held for the Łódź Opera, led by Denis Callahan, who works with New York City Hall. ::

One of the best known rockmen, Bryan Adams, will sing on 13 June in Rybnik. It will be the biggest music event in this city’s history and one of the most important concerts in Poland this year. The concert is organised by Prestige MJM company and Polish Radio Programme 3. The Canadian singer will sing in the City Stadium, modernised in 2003. The concert will begin at 9.00 p.m. The organisers expect over 20,000 fans to turn up to watch the live performance. “I can tell you with full responsibility that this is the biggest music event in Rybnik’s history. We are proud, that such a magniﬁcent artist will perform in our town. It will surely promote the city all over the country. I have no doubt that on 13 June, many fans of Bryan Adams will come here. Not only from diﬀ erent regions of Poland, but also from abroad. I invite you to this exceptional event. We will do our best to give you the best reception possible,” declares Adam Fudali, the Mayor of Rybnik. ::

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Cultural Monitor

The Warsaw Opera House:

a must on your itinerary “Poland is not a country in which bus drivers hum opera arias... I think, however, that in terms of its brand name and artistic repertoire, the Grand Theatre has become an attractive marketing product which ranks it deﬁnitely as one of the leading opera theatres in Europe,” says Waldemar Dąbrowski, Director-in-Chief of the Polish National Opera in Warsaw, in an interview with Maciek Proliński.

Ever more frequently these days the prominence of culture is considered to be on par with the economy. To what extent, in your view, may culture also serve as an engine driving economic growth? I think that the situation of Polish culture is better than at any time before. And that not just from the purely artistic point of view but also in terms of widely perceived cultural oﬀer for the public. Culture in public debate is most

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often perceived as a fresco, a kind of an ornament that “beautifies our life.” Yet obviously, culture is not just an ornament. It is an environment in which we are born, grow up and pursue our life. Life is good when it is complete. But it will never be complete without culture. It is the cultural level of the society and that of its individuals that basically defines what we refer to as the energy of civilization development. Obviously, a cultural man is more efficient when operating the machine tool. It follows from reading habit rate indexes that people in the world’s most developed countries read more books than others. Which suggests that the number and quality of books read determines in a way the level of economic and political life of a society and the lot of its individual members. Hence the perception of culture as a basic factor of civilization growth is in my opinion fundamentally right. I believe that concern and attentiveness of the state to culture determines the growth and development of all other spheres of our common life. Secondly, we are witnessing nowadays a rapid growth of tourism, one of the strongest industries of our times, and within its framework that of cultural tourism. And in that respect I think that Poland’s cultural potential has not yet been sufficiently exposed. The Chopin Year, for one, has well shown how much we have to offer. As you mentioned the Chopin Year, what do you think was the point of that year? To what extent did the events commemorating the big

Polish pianist and composer help to reveal what is nowadays happening in Polish arts? The Chopin Year was certainly Poland’s biggest and unprecedented image-building event in the world. Chopin has become a value radiating worldwide in a most extraordinary way not only through his works but also due to being a most phenomenal individuality of Romanticism, probably the most engrossing cultural era. The idea of the Chopin Year was to approximate the image of contemporary Poland, its present-day countenance and traditions with the top quality mark which Chopin is. It was our intention to show the world through his works what we are today, what present-day Poland is like. I believe that we succeeded in doing that. 4,500 events took place throughout the world to mark the Chopin Year. The 6th edition of the “Chopin and His Europe” international festival was the major highlight in Poland. On Chopin’s 200th birth anniversary the atmosphere in Warsaw was really that of the big world. It was, among others, thanks to the festival, that many most prominent world artists incorporated the works of Polish composers into their repertoire. In a few months Poland will take over the EU presidency. What role might be played by Polish culture at that time of our history? Culture might turn out to be the best vehicle of building the Polish brand, surely the cheapest and most eﬀectively targeted. I have in recent days played host to quite a number of persons renown on the global cultural scene. Many visited Poland for the ﬁrst time and were greatly impressed. Their knowledge and perception of Poland did not match what they actually saw. They were taken aback by the quality of what we present, the beauty of Warsaw and also the rank of this theatre. Which shows that our potential is immense. It would surely be worse if the country was over-advertised and if visitors’ impressions upon

Cultural Monitor coming to Poland would be definitely remote from what they have seen in brightly coloured leaflets. The presidency will obviously provide an opportunity for presenting Polish artistic programmes in various parts of the world and in Poland. We’ll inaugurate Poland’s EU Presidency in this theatre with the premiere performance of Karol Szymanowski’s “King Roger” directed by David Pountney. Th is very famous Polish opera, composed by a brilliant opera visionary of our times, with its theme focusing on Europe, will open Poland’s EU presidency. It will be a most fitting sign, an emblem of challenges facing the European Union and Poland these days. Furthermore, I am going to arrange an international conference this October under the theme of “Europe Opera” to be attended by directors of all European opera companies. I also intend to stage a special summing-up event of Poland’s presidency in the Polish National Opera: a New Year Eve concert with “Ode to Joy” sung in Polish in the finale. What in your view is the greatest value of the Polish National Opera? How do you intend to balance between the value such as is surely represented by new platforms of communicating with arts consumers and the canon of a sort of this particular place? One of our most important tasks is, speaking briefly, to conduct a creative dialogue with the public. Poland is not a country in which bus drivers hum opera arias. I think, however, that in terms of its brand name and artistic repertoire, the Polish National Opera has become an attractive marketing product which ranks it defi nitely as one of the leading theatres in Europe. I am far from being modest in saying that. For I am referring to facts. We can be proud of our high position, the more so as we have to plan the repertoire at least 2-3 years in advance, hence the artistic dimension of the theatre could not be changed within such a short time. Co-productions with the biggest opera houses, the presence of accomplished directors, renowned singers and leading conductors, the offer versatility, that all generates the feeling that visiting the Polish National Opera is worthwhile, and so is also to be associated with our brand name. For we are a theatre inscribed into

the common creative and production dynamics. May I just mention that we managed to enlist the cooperation of prominent creators and performers including David Pountney, Keith Warner, Sasha Waltz and Valery Gergiev. It is also our ambition to achieve a balance between the avant-garde and modern perception of tradition. For it seems that all things most interesting in European opera spring up these days in this strain ﬁeld. What else can music fans expect in the Polish National Opera this season? We shall shortly stage the premiere performance of a new ballet production by Poland’s outstanding choreographer Krzysztof Pastor (the director of the Polish National Ballet) to the music of Henryk Mikołaj Górecki’s “And the Rain will Pass.” We planned this premiere quite some time ago and we did not think at all that the late composer might no longer be with us to see it. Górecki’s music is a mystery. It is imbued with special charm and that also for the choreographer. In the past, Krzysztof Pastor designed a ballet to the music of Henryk Mikołaj Górecki’s legendary “Symphony No. 3,” ﬁrst in Warsaw with the Grand Theatre Ballet and then in a new choreographic version with Het Nationale Ballet in Amsterdam. This time Krzysztof Pastor decided to reach for Górecki’s other, less known compositions. I think this will be an important artistic event. We are also going to stage “Turandot” by Giacomo Puccini directed by Mariusz Treliński. The contemporary Japanese opera “Matsukaze” (Winds in the Pines), a history of lingering spirits of two sisters who died of grief after the death of a man they both loved, will be produced by prominent German director and choreographer Sasha Waltz. “The Rite of Spring,” the legendary ballet of Igor Stravinsky, will be shown in choreographic versions by Vaclav Nijinsky, Emanuel Gat and Maurice Béjart. These are our coming premieres in this season. And what about Polish music, Polish composers in Polish National Opera artistic plans? Due attention will surely be given to Polish creative output. After all, promoting Polish music and composers is one of the prime duties of our national theatre. We are preparing the

Cinderella

Katia Kabanowa, directed by David Alden

pre-premiere of “Qudsja Zaher” composed by Paweł Szymański, one of the greatest Polish contemporary composers. Th is opera was commissioned by the Polish National Opera eleven years ago and will be directed by Aron Stiehl. The title role will be sung by Polish famous soprano Olga Pasiecznik. The score was written by the composer especially for her. Eugeniusz Knapik, one of the most interesting Polish contemporary composers and a pupil of Mikołaj Górecki is currently working on “Moby Dick,” another new opera commissioned by Polish National Opera. We are also planning to produce a new version of Stanisław Moniuszko’s “Halka”, the ﬁrst Polish national opera. Th is best known Polish opera of the 19th century will be directed by Natalia Korczakowska, a talented young theatre director debuting in our Opera House. The orchestra will be conducted by Marc Minkowski, the French versatile conductor of high repute. We shall also prepare the performance of one opera by Krzysztof Penderecki: “The Devils of Loudun,” the ﬁ rst and most popular of Penderecki’s operas, or “The Black Mask.” There will be indeed plenty of interesting events to choose from. You are cordially invited to visit us. :: 3/2011 :: polish market ::

Cultural Monitor

A deep and permanent imprint… The Chopin Year has come to an end. The events commemorating Frederic Chopin’s 200th birth anniversary were summed up at a conference held in the Grand Theatre - National Opera House in Warsaw on February 28. In that year, one very special for Polish culture, 2600 artistic events featuring the Polish composer’s works took place in Poland and 3600 abroad. The Polish Minister of Culture and National Heritage Bogdan Zdrojewski described these events as “most impressive” and said that “they have left a deep and permanent imprint that will be forever remembered.”

22nd Warsaw International Poster Biennale. Gold winners in the “Chopin Anew” category: Nancy Skolos and Thomas Wedell, “200th Anniversary of Frederic Chopin’s Birth. 2010.” Photo Courtesy Wilanów Poster Museum

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The 2010 Chopin Year in Poland had an unprecedented width and breadth. All in all, over PLN133 million were earmarked by all government departments between 2005 and 2010 to prepare the commemorative events. More than PLN29 million were spent in 2010. The funds were to a great extent assigned to revitalize and rebuilt historic buildings connected with the famous Polish composer and the setting up of the Chopin Centre in Warsaw as well as for the restoration of the country house in Żelazowa Wola near Warsaw where Chopin was born and of the adjacent park. The high-tech Frederic Chopin Museum opened in Warsaw at the start of the Chopin Year in March last year was also a major investment undertaking. Concerts marking the bicentenary of Chopin’s birth, the Gala in the Grand Theatre and National Opera, the “Chopin and his Europe” festival, the 16th International Frederic Chopin Piano Competition in Warsaw and the

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International Chopin Congress attended by the world’s most renowned musicologists were the most important Chopin Year events in Poland. They attracted wide international media attention. More than 300 foreign correspondents covered the events for the world press, TV and radio stations. The Chopin Year oﬀered a splendid opportunity to disseminate knowledge about the life and work of this outstanding pianist and composer. More than 130 books on Chopin were published. CDs, multimedia publications and computer educational games for children were released. A set of ﬁlms about Chopin was issued in eight languages. To upgrade the facilities of music schools, the Ministry of Culture and National Heritage launched in November 2010 the “Piano for schools” scheme to fund the purchase of music instruments for young pianists. Between 2007 and 2011, the Ministry has assigned some PLN25 million for supply of music instruments to artistic schools. In his remarks Bogdan Zdrojewski highlighted the deep impact left by the Chopin Year in terms of disseminating knowledge about the composer and his works and creating a solid foundation for a better grasp of his music and life. Mayor of Warsaw Hanna Gronkiewicz-Waltz elaborated on the numerous investments completed in the capital city in the run-up to the commemorative events. PLN10.7 million were spent for repairs of buildings and premises connected with Chopin and PLN22 million for promotion, education, publications and support of a vast array of

cultural events. She noted that following the commemorative events many people have become much more aware of the composer’s ties with Warsaw. She said that in 2009, only 20% of Warsaw residents were aware that Chopin spent his childhood and adolescence years in Warsaw whereas 33% are aware of that now, according to the latest surveys. “We shall continue disseminating knowledge about the composer’s ties with the Polish capital,” Gronkiewicz-Waltz said. The chairman of the Chopin Year 2010 Celebrations Waldemar Dąbrowski spoke about the wide response of the commemorative events in foreign media and their impact on disseminating knowledge about Polish culture world-wide. The major events abroad included the Asia-Paciﬁc Chopin Competition, the series of 12 Chopin concerts in the Art Palace in Beijing, the Chopin concert at EXPO 2010 in Shanghai, the Festival of young pianists in Tomsk (Russia), the Frederic Chopin Festival in Paris, the 51th Chopin Festival in Mariánské Lázně (in the Czech Republic), the Chopin concerts in Africa (Nairobi, Mombasa) and the Gulf International Chopin Competition in Kuwait. “Admittedly, the Chopin Year has come to an end,” said Waldemar Dąbrowski. “But in fact it has only been the beginning of more events to come taking advantage of the vast opportunities that have been opened in the course of the Chopin Year to disseminate Polish culture aboard.” MP

Events

Prospects for agricultural and food exports Issues concerned with the current state as well as prospects for Polish agricultural and food exports were discussed in depth at a national conference held in Warsaw last month. The event was organized for the ninth time by the Association of Polish Exporters (SEP) and was held under the honorary patronage of Ewa Kierzkowska, a deputy speaker of the lower house of Parliament, and Marek Sawicki, the minister of Agriculture and Rural Development. Opening the conference, SEP president Mieczysław Twaróg submitted the Association’s “Strategy of pro-export growth of the Polish economy”

document to Deputy Agriculture Minister Marian Zalewski. Honorary Badges for services to agriculture and certificates of distinction were presented to leading exporters of agricultural and food products in recognition of their outstanding achievements. The long debate that followed was of a highly constructive nature in assessing the current state of agricultural and food exports as well as the companies involved. The main topics on the agenda were concerned with: :: measures targeted at accelerating exports growth and overcoming the economic crisis, :: operation of export support instruments, :: tapping EU funds to stimulate exports, :: effectiveness of promotion steps to increase exports in priority fields, :: enforcement of pro-export strategy to speed up the country’s economic growth. Taking the floor, Deputy Agriculture Minister Marian Zalewski elaborated on conditions and prospects for Poland’s agricultural and food exports while Vice-President of the Agricultural Market Agency Lucjan Zwolak reviewed issues concerned with ways and means of promoting Polish farm products and food on foreign markets. Marek Ociepka, Counsellor-Minister and Head of the Economic and Trade Department of the Polish Embassy in Moscow expanded on Polish food export opportunities on the Russian market while Witold Prandota, the Counsellor-Minister and Head of the Economic and Trade Department at the Polish Embassy in Beijing spoke about the new opportunities opening up for Polish food products in China. Ewa Flis, the Counsellor-Minister and Head of the Economic and Trade Department at the Polish Embassy in Athens spoke about the terms and prospects for Polish agricultural and food exports to Greece. Chances of

such exports to the Republic of South Africa were reviewed by Sławomir Sonarski, the fi rst secretary of the Polish Embassy’s Trade and Investment Promotion Section in the RSA. The panel discussion which followed focused on issues concerned with export directions and goals in the confectionery, dairy, meat, honey, fruit, vegetable, fish and food industries and the relevant priority export markets for their products. The debate was chaired by Marta Karpeta, the head of the Confectionery Exporters’ Group. Speakers included Lech Kostecki, head of the Poultry Exporters Group, Janusz Kasztelewicz, head of the Honey Exporters Group and Agnieszka Truszko, deputy president of the Białuty Agricultural Cooperative. Professor Andrzej Kowalski, director of the Institute of Agricultural and Food Economics summed up the debate. Apart from the panel debate a lecture was given by Rafał Wasak, head of the Foreign Trade Support Department in Bank Gospodarstwa Krajowego (BGK S.A.) on bank instruments in support of agriculture and food exports while Zygmunt Kostkiewicz, president of the Export Credit Insurance Corporation (KUKE) gave an extensive report on insurance instruments offered by KUKE in support of export operations pursued by the agricultural and food processing sector. In the course of the conference the importance was stressed by many speakers of stepping up the promotion of Polish farm and food products on foreign markets. They urged the Ministry of Agriculture and Rural Development to draw up a strategy of promoting these exports on Eastern markets and do so in consultation with producers, exporters and investors. Th is strategy, it was stressed, should become part and parcel of the national strategy of promoting the Polish economy. :: 3/2011 :: polish market ::

Events A grand, carnival gala of the “Personalities of the Year 2010” took place on February 27 at the InterContinental hotel in Warsaw. During the event Polish actor and film producer Mariusz Pujszo presented statuettes to persons who distinguished themselves last year by doing things spectacular and positive in various fields. “I have asked some one hundred people, my friends and acquaintances, prominent entrepreneurs, artists and journalists with authority in their fields to name persons who in their opinion deserved the title of the ‘Personality of the Year 2010.’ From among these names, the Chapter selected winners in the category of politics, cinema, theatre, science, culture, the media, sports and fashion. I hope that persons so honoured will become models of success and fair play for others.” Members of the Chapter were: Łukasz Zagrobelny, Piotr Rubik, Agnieszka Włodarczyk, Krzysztof Skiba, Robert Korzeniowski, Ewa Kuklińska, Anna Samusionek, Marta Mandrykiewicz, Karol Jełowiecki, Bożena Batycka, Andrzej Supron, Andrzej Turski, and Hanna Bakuła. Statuettes were also presented in the category of “Business Discovery of the Year 2010.” “We wish to point out that our Chapter was not guided in its decisions by the size or popularity of a respective firm. The company selected might have been an already known firm which has spread its wings last year or one that introduced an entirely new product into the Polish market. It might have also been a newcomer on the business scene. Hence the award-winners include companies perhaps not generally known yet, but certainly ones with a big potential. We’ll certainly hear a lot about them soon,” Mariusz Pujszo said. The star of the evening was Marek Torzewski, a Polish tenor of world renown. A fashion show was staged. Participants could try their luck in lotteries and prize competitions. The promotion took place of “Królowie życia,” the latest book by Mariusz Pujszo. The book brings the author’s reminiscences of his stay for many years in Paris, accounts of his incredible adventures as well as anecdotes about world and French film stars. The event lasted until very late hours and was attended by 600-700 known personalities representing the country’s cultural, business, scientific and social elite. ::

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The Grand Gala of the

Marek and Barbara Torzewski

Jarosław Chrobociński and Maja Sujkowska

Personalities of the Year 2010

Stanisław Kluza

Marta Grycan

Janusz Głowacki

Events

Personalities of the Year 2010

Ilona Łepkowska

Business Discovery of the Year 2010

Alicja Resich-Modlińska

Sławomir Petelicki and Mariusz Pujszo

Katarzyna Grochola and Krystyna Woźniak-Trzosek

Mariusz Pujszo and Ewa Minge

Barbara and Marek Torzewski, Krystyna Woźniak-Trzosek, Rita Schultz, Błażej Grabowski

Mariusz Pujszo, Mariusz Treliński and Jan Jakub Kolski

3/2011 :: polish market ::

Events

The 5 Europe-Ukraine Forum More than 400 guests participated in the 5th Europe-Ukraine Forum organized in Kiev by the “United World” Foundation and the Institute for Eastern Studies in Warsaw, to discuss the successes and failures of Ukraine on the 20th anniversary of its independence. “20 years of independence is a successful period for Ukraine, regardless of all the difficulties, problems, and drawbacks. Undoubtedly, it is a success story,” said Adrian Severin, an MP of the European Parliament. The most distinguished guests of the meeting included: Leonid Kuchma, Ukraine’s president between 1994 and 2005, and the former EU Commissioner for Enlargement Günter Verheugen. The Ukrainian leader expressed concern that Ukraine may once again play the role of a buffer state between Europe and the East. “These days, the geopolitical factors make significant impact on Ukraine’s integration with the EU,” he said. Referring to the 1990s, Kuchma talked about the challenges faced by Ukraine at the beginning of its independence. “We had no development strategy and a lot of decisions were made by trial and error,” he remarked. Touching upon Ukraine’s European integration, Günter Verheugen said that the European Union should work out a clear strategy towards Ukraine and offer much more than it has so far. The former commissioner criticized today’s EU elite for the lack of political will and courage in the scope of the EU enlargement policy. The Forum began with a presentation of the transformation report titled “Ukraine – 20 Years of Independence”, which concludes that once Viktor Yanukovych had won the presidential election, Ukraine became politically stable, but problems related to the perception of democratic rules was the price that had to be paid for the victory. “Last year, Ukraine lost the status of the most democratic country in the Commonwealth of Independent States,” said Alexander Sushko, director of the Institute for Euro-Atlantic Research. Much attention was paid to the Ukrainian economy. Macroeconomic data for 2010 (GDP growth of approx. 4%, low inflation, better exports) seems to prove the post-crisis revival. Natalia Karolevska, an economist from the opposition Block of Yulia Tymoshenko, talked about the problems and weaknesses of the economic policy applied by the government headed by Prime Minister Mykola Azarov and President Viktor Yanukovych.

96 ::

polish market :: 3/2011

To her mind, the reforms are being implemented chaotically, with no systematic solutions, while the government has been creating an illusion of counteracting corruption and, in reality, manually managing all the major risks. Moreover, Ukraine lacks stable laws and property rights protection. “Proper reforms should be based on modernization, innovation, and deregulation. They should stimulate small and medium enterprises, change the economy structure, and streamline business environment,” pointed out Natalia Karolevska. The experts focused on the role of foreign investments for the Ukrainian economy. According to them, foreign investors could be attracted by the proper business climate and appropriate macroeconomic factors such as stable monetary policy, currency resistant to ﬂuctuations, and an independent central bank. In the light of the ongoing negotiations with the EU on the Association Agreement

and a deepened Free Trade Zone, the theme of European integration sounded all the more important. “Ukraine is not very likely to end the negotiations on the Free Trade Zone before this summer, but if we manage to sign the Association Agreement our relations with the European Union will reach a different level of quality,” said Andrey Goncharuk, a chief deputy of President Viktor Yanukovych’s administration. Olexandr Chalyi, an Extraordinary Ambassador, the former President’s chief of staff declared that Kiev wanted to complete the Association Agreement negotiations even with no clear European perspective. Referring to the 5th Europe-Ukraine Forum, Anna Herman from the President’s administration pointed out that open discussions held by experts and politicians related to the government and opposition tended to decrease the pressure, shifting the focus of attention to significant issues concerning today’s Ukraine and its relations with the neighbours. ::

Economic Monitor

Economic Monitor January 2011

Key economic trends :: According to preliminary data, Poland’s 2010 GDP grew 3.8% in real terms, a ﬁgure that ranks Poland among EU economies with the fastest rate of growth. Source: Informacja o sytuacji społeczno-gospodarczej kraju. Rok 2010, www.stat.gov.pl

dex (LI), which provides data on future trends in the economy, fell slightly from 2010M12. However, the index is still relatively high and has shown a strong upward trend recently. Th is means that the Polish economy will continue to do well, though it may not be growing as fast as last year. Source: www.biec.org

:: Domestic demand in 2010 grew by 3.9% in real terms compared with the previous year. Factors that contributed to this growth included a 6.7% increase in capital formation and a 3.2% rise in consumption. Gross fi xed capital formation in 2010 was 2% lower than a year earlier, which was largely due to low investment spending in the fi rst two quarters of 2010. Individual components of consumption—private consumption and public consumption— grew more evenly. :: Gross value added increased by 3.3% last year. The fastest growth was recorded in industry, which was quickly coming out of the bad times. Gross value added in industry increased by 9.2%. Construction took longer to respond to improved market trends, with value added 3.8% higher than in 2009. Market services grew by 1.5%, with particularly rapid growth in transportation and trade. Th is rapid growth is due to factors including high – albeit decreasing – sales of durable consumer goods. :: Global economic climate deteriorated in 2010Q4 compared with the previous quarter, according to the Ifo World Economic Survey. Although the assessment of the current situation improved slightly, forecasts for the fi rst months of 2011 deteriorated significantly for the third consecutive quarter Source: www.cesifo-group.de

:: In 2011M1, the BIEC (Bureau for Investments and Economic Cycles) Leading In-

:: Encouraging prospects for changes in economic trends make it possible to expect an increase in investment in 2011. The increasing percentage of long-term unemployed, coupled with a high budget deﬁcit and shrinking demand for durable consumer goods, may slow the growth of consumption in 2011.

Industry Industrial output showed accelerated growth in 2010M12 in year-on-year terms in constant prices. Sales of durable consumer goods decreased during this period. Positive trends were noted in the sale of investment goods. Among individual sectors of industry, the fastest growth in sales was recorded in manufacturing. 2010M12 was the second straight month in which the growth of industrial output accelerated in year-on-year terms. Industrial output increased by 11.5% year on year. Th is ﬁgure was lower than in the spring/summer season of last year—which was especially productive in this respect—but higher than the average annual rate. Moreover, industrial output increased at a much faster rate than at the beginning of 2010Q4, when its growth decelerated. Th is shows that the slowdown was only temporary. Another piece of good news is that seasonally adjusted industrial output grew at a faster rate as well. Its growth had decelerated in the three preceding months. In 2010M12, the ﬁgure was 11.5% in year-on-year terms, up from 7.3%

in the previous month. Th roughout 2010, industrial output rose by 9.8% over the previous year. To compare, the ﬁgure for the 2010M111 period was 9.7%. Labour productivity in industry, measured with sales per employee, was 10.4% higher in 2010 than in 2009. (Source: Informacja o sytuacji społeczno-gospodarczej kraju. Rok 2010, www.stat.gov.pl). In the 2010M111 period, labour productivity grew 10.6% in year-on-year terms. In 2010M12, new orders received by industrial enterprises increased markedly. There were 10.5% more orders than in 2010M11 (according to seasonally adjusted data). Compared with 2009, there were more orders in 2010 as a whole. In 2010M12, their year-on-year growth was relatively high, at 23.4% (a comparable increase was recorded in 2010M3). Among commodity groups in key industrial sectors in 2010M12, sales of energy-related goods fell by 10% in year-on-year terms and sales of durable consumer goods went down by 0.8%. Negative changes in business trends have been noted in the case of these goods since 2010Q2. In previous years, sales of durable consumer goods increased rapidly, which contributed to an improvement in the performance of industry, even during the economic crisis of 2007-2009. The rate at which these sales grew peaked in 2010M2 and has decreased since then, which may be the result of the market being saturated with this type of goods. In the coming months, this may have a negative impact on industrial output. Sales of non-durable consumer goods rose by 5.4% in 2010M12 in year-on-year terms, compared with 6.6% in 2010M11. Positive trends were noted in the sales of capital and intermediate goods. Their sales grew throughout 2010 at an increasingly fast rate. In the case of intermediate goods, the increase was 21.3% in year-on-year terms (compared with 18.9% in 2010M11), while the ﬁgure for capital goods was 23.3% (against 8.9% in 2010M11). Th is augurs well for changes in capital expenditure in the coming months.

3/2011 :: Polish Market :: I

Economic Monitor

2010M12 was an excellent month in terms of manufacturing output, which grew by 13.8% in relation to the corresponding period of 2009 (according to seasonally adjusted data). Sales in the water supply/sewage and waste management/land reclamation sector were also better than in November 2010. In 2010 as a whole, industrial output increased the most in manufacturing (by 11.2%). In the case of water supply/sewage and waste management/land reclamation, output increased by 6.3% in year-on-year terms. In the remaining sectors—mining and quarrying; and

the production and supply of electricity, gas, steam and hot water—sales grew at a slower rate in year-on-year terms in 2010M12 than in the previous month, and in all of 2010 output increased by 1.3% and 0.1% respectively. Among 22 selected manufacturing sectors, six reported a decrease in sales in 2010 compared with the previous year. In the 2010M111 period, ﬁve sectors reported a drop in sales. As previously, the greatest decrease was noted in the manufacture of “other transport equipment” (down by 11.6%) and beverages. A strong increase was observed in the pro-

16% 14% 12% 10% 8% 6%

8.5

9.0

9.4

10.1

2010 M1

2010 M2

2010 M3

2010 M4

2010 M5

10.6

10.4

10.7

9.6

9.7

9.8

2010 M7

2010 M8

2010 M9

2010 M10

2010 M11

2010 M12

4% 2% 0% -2% -4%

in cumulative terms

2010 M6

in non-cumulative terms

Source: Central Statistical Office (GUS)

Fig. 1. Change in industrial output, Mt/Mt-12

8.6 7.4 6.7 6.0

wearing apparel

pharmaceutical products

food products

textile products

chemicals and chemical products printing and reproduction of recorded media products of wood and cork… leather and leather products

metal products

electrical equipment

rubber and plastic products

metals

paper and paper products other non-metallic mineral products motor vehicles, trailers and semitrailers

computers and consumer electronics

0.0

-1.5 -3.1 -3.6

other transport equipment

10.5

beverages

12.0 12.0

furniture

13.9

tobacco products

17.3 16.9 15.9 15.7 15.5

coke and petroleum products

21.0

machinery and equipment...

47.2

-5.1 -7.7 -11.6

Source: Central Statistical Office (GUS)

Fig. 2. Change in output in selected manufacturing sectors, 2010M1-12, Mt/Mt-12

II :: Polish Market :: 3/2011

duction of computers, electronic and optical products (up by 47.2%) and in metal production. In relation to the annual growth rate for 2010M1-11, the rate at which production grew decreased in eight sectors, while increasing in the remaining sectors. Th is means that no strong negative or positive impulses have spread across the economy that could testify to an acceleration or deceleration of growth in manufacturing output, though positive developments outweigh negative ones. Business climate in industry as evaluated by managers worsened in early 2011. However, the overall business climate indicator for the sector shows no sustainable trend and needs to be checked further in the coming months. The seasonally adjusted indicator of the overall economic climate in manufacturing fell in 2011M1 and the percentage of entrepreneurs who positively rate economic trends approached the percentage of those who evaluate these trends negatively. The indicator declined mostly due to worse ratings of financial liabilities, order books and the overall economic situation. For now, the recorded decrease does not mean a more permanent downward trend in business climate indicators. Forecasts for the next three to four months, however, are less optimistic than those for 2010M12. In relation to the end of 2010, forecasts for fi nancial liabilities, for example, worsened. On the other hand, the assessment of employment did not change; it has stayed at a stable level for several months. Th is means that, except for seasonal fluctuations, managers in the manufacturing sector have no plans to either hire or fi re staff.

Construction and investment projects As a result of an encouraging end of 2010, sales in the construction and assembly sector increased in 2010 as a whole compared with the previous year. In 2010M12, the rate at which sales grew in the construction and assembly sector was 12.3% in year-on-year terms, versus 14.2% in 2010M11. However, after a seasonal adjustment, the increase was 13.7%, against 11.1% in the preceding month. Due to relatively fast growth in construction output that had continued for several quarters, after an

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25 20 15

unimpressive ﬁ rst half of 2010, sales in construction increased in cumulative terms in 2010Q4. Moreover, in cumulative terms, this increase was faster in 2010M1-12 than in the previous two months, at 3.5% (versus 2.3% in 2010M1-11). Cumulatively, construction output has increased the fastest in companies providing specialised construction work (by 7.7% year on year), while growing at a slower rate in companies dealing with the construction of buildings (an increase of 2.8% year on year) and construction of civil engineering facilities (an increase of 1.8% year on year). In 2010M12, the fastest increase in output was recorded in the case of companies dealing with the construction of buildings, while output in companies dealing with the construction of civil engineering facilities decreased slightly. According to preliminary GUS data, 135,715 housing units were completed in 2010 as a whole, 15.2% less than a year earlier (in 2009, a 3.1% decrease was recorded). A decline was recorded in all segments of the construction sector, including buildings intended for sale and rent—down by 26.4%, and private construction projects—down by 2.1%. The number of dwellings built by companies for their employees was 54.7% smaller than a year ago; projects handled by housing cooperatives shrank by 29.1%; housing construction projects carried out by local governments fell by 19.7%; and low-income housing constructed by building societies fell by 9.6%. In 2010, for the ﬁ rst time since 2003, a reduction was recorded in the role of construction projects intended for sale and rent in the overall number of housing units completed (down by 6 percentage points to 39.2%), while the percentage of private construction projects increased (by 6.9 points to 51.9%) after two years of falling. Source: Informacja o sytuacji społeczno-gospodarczej kraju. Rok 2010, www.stat.gov.pl

The good news is that the drop in the number of dwellings completed decelerated and the number of housing starts was higher in 2010 than a year earlier. Although the number of new building permits decreased—due to a smaller number of dwellings (compared with a year earlier) for which building permits have been issued in cooperative and private construction—the number of permits for the construction of housing intended for sale increased in 2010 after a prosperous 2010Q4.

10 5 0 -5

2010 M1

2010 M2

2010 2010 M3 M4

2010 M5

general business climate

2010 M6

2010 M7

output

2010 M8

2010 M9

2010 2010 M10 M11

2010 M12

2011 M1

order books (projection) Source: Central Statistical Office (GUS)

Fig. 3. Business climate indicators in the manufacturing sector The projection is for the next three months. 20% 15% 10% 2.3

3.5

0.2

0% -5%

-1.5

-3.4

-10%

-6.1

-5.7

2010 M6

2010 M7

-8.7 -15% -20%

-11.5 -15.2

-15.3

-25%

-20.9

2010 M1

2010 M2

2010 M3

2010 M4

in cumulative terms

2010 M5

2010 M8

in non-cumulative terms

2010 M9

2010 M10

2010 M11

2010 M12

Source: Central Statistical Office (GUS)

Fig. 4. Change in construction output, Mt/Mt-12

20 10 0 -10 -20 -30 2010 M1

2010 M2

2010 M3

general business climate

2010 M4

2010 M5

2010 M6

2010 M7

output

2010 M8

2010 M9

2010 M10

2010 M11

2010 M12

2011 M1

domestic orders (projection) Source: Central Statistical Office (GUS)

Fig. 5. Business climate indicators in the construction sector The projection is for the next three months.

3/2011 :: Polish Market :: III

Economic Monitor

10% 8% 6% 3.1 4% 2%

0.7

0.3

1.5

0.8

0.2

1.9

2.2

2010 M10

2010 M11

0% -0.5

-0.1

2010 M4

2010 M5

-2% -1.1 -4% 2010 M1

-1.6 2010 M2

2010 M3

in cumulative terms

2010 M6

2010 M7

2010 M8

in non-cumulative terms

2010 M9

2010 M12

Source: Central Statistical Office (GUS)

13.6

8.3

5.1

textiles, clothing, footwear

pharmaceuticals, cosmetics, orthopaedic equipment

other retail sales

motor vehicles, motorcycles and parts

solid, liquid and gaseous fuels

newspapers, books and other goods from specialized stores

14.5

other…

17.1

food, beverages, tobacco products

23.5 furniture, radio and TV equipment, household appliances

Fig. 6. Change in retail sales, Mt/Mt-12

-5.2

-17.7

-1.9

Source: Central Statistical Office (GUS)

Fig. 7. Change in retail sales of selected products in 2010M1-12, Mt/Mt-12

10 5 0 -5 -10 -15

2010 M1

2010 2010 M2 M3

2010 M4

general business climate

2010 M5 sales

2010 M6

2010 M7

2010 M8

2010 M9

2010 2010 2010 2011 M10 M11 M12 M1

demand (projection) Source: Central Statistical Office (GUS)

Fig. 8. Business climate indicators in the trade and repair of motor vehicles, seasonally adjusted The projection is for the next three months.

IV :: Polish Market :: 3/2011

Among businesses involved in the construction of civil engineering facilities, a 3.6% increase in output in year-on-year terms was reported by companies specialising in the construction of roads and railways—a segment that accounts for a predominant part of the sector. Businesses specialising in the construction of pipelines, telecommunications and power lines recorded a 1.7% drop, while businesses specialising in the construction of other civil engineering facilities reported a 0.4% decrease. Source: Informacja o sytuacji społeczno-gospodarczej kraju. Rok 2010, www.stat.gov.pl

Business climate in the construction sector has been pessimistic since 2010Q2. It improved slightly in 2011M1, but this did not lead to a reversal in the negative trend in the sector as far as the business climate indicator is concerned. Business climate in construction in 2011M1 was evaluated pessimistically by construction company managers—though slightly better than in 2010M12. The worst ratings were given to the ﬁnancial performance and overall economic situation in the sector, while better ratings were given to production and orders. Forecasts for the next three to four months are also slightly better than those at the end of 2010. The best predictions apply to production, the worst to employment and the ﬁ nancial situation. Investment climate surveys conducted by GUS show that capital expenditure in industry, as evaluated by managers from this sector, increased by 19% in 2010. Compared with 2009, business sentiment improved. In construction, ratings given by business managers point to a 16.2% decrease in capital expenditure in 2010. However, this means an improvement in economic sentiment in relation to a survey conducted in 2010M3, when a 26.5% decline was predicted in capital expenditure in 2010. The mood among managers in terms of predicted spending on investment in trade and services in early 2011 was optimistic. Among respondents in both these sectors, those planning to increase spending on investment outnumbered those thinking of reducing spending in the coming months. In 2011M1, investment climate in retail trade was better than in the previous month and it was also better than a year earlier. Similar trends were noted in the service sector,

Economic Monitor

where investment climate was even better. Among individual segments of the service sector, the best investment climate prevailed in companies active in ﬁ nancial services and insurance - which bodes well for the development of these companies – and in activities related to culture, entertainment and recreation. The worst—though still optimistic—investment climate in the service sector prevailed in education.

Trade Retail and wholesale trade in goods grew at an accelerating pace in the last few months of 2010. The trend was recorded in most segments of both retail and wholesale trade. Retail sales of goods increased by 9.1% year on year in constant prices in 2010M12. Th is growth was much faster than in 2010M11, when sales increased by 6.1% year on year. In 2010 as a whole, sales increased by 3.1%, against a 2.2% rise in 2010M1-11. Wholesale trade by enterprises increased by 12.2% in current prices in 2010. In 2010M12, it went up by 18.6%, accelerating for the second straight month. Retail sales decreased in three of nine commodity groups in year-on-year terms in 2010; in the remaining groups, an increase was recorded. The fastest growth (23.5%) was recorded in the sale of furniture and electronic equipment and appliances; the fastest decline occurred in the case of newspapers, books and “other sales in specialised stores” (down by 17.7%). In 2010M12, the rate at which sales grew declined in year-on-year terms in one group of goods—newspapers, books and “other sales in specialised stores.” Th is marks an improvement over the previous month in terms of both the number of sectors in which a decrease was recorded and the rate at which this decline took place. The fastest increase was in the sale of motor vehicles, motorcycles and automotive parts, a trend that may in part be due to an increase in the VAT rate on these goods as of 2011. The increase in VAT may cause a drop in sales of these goods in the ﬁ rst few months of 2011. Economic climate in the trade and repair of motor vehicles deteriorated for the second quarter in a row in 2011M1. The decrease resulted from worse prospects for changes in the sector’s performance in the coming months.

The seasonally adjusted business climate indicator stood at -0.7 in 2011M1, versus 1.8 in 2010M12. Pessimistic ratings slightly outweighed optimistic ones. For the time being, the decrease in the indicator does not mean a more sustained negative trend. However, the bad news is that its decline was in part brought about by a negative outlook for the next three to four months, after a positive outlook in previous months. Compared with previous months, the overall economic situation and ﬁ nancial liabilities received better ratings. Ratings for sales did not change. Financial liabilities are still the worst rated component of the business climate indicator. Employment was the only component of the forecast that was assessed better in 2011M1 than in 2010M12. Other areas of business activity were rated worse, with the greatest decrease recorded in the case of expectations for changes in the overall economic situation in the sector and in the case of demand.

uation of changes in the ﬁ nancial condition of households (in the last 12 months) improved slightly (by 0.3 percentage points). The remaining indicators fell: by 0.8 percentage points in the case of changes in the expected unemployment rate and by 3.5 points in the case of expected savings opportunities. Source: Koniunktura konsumencka. Styczeń 2010, www.stat.gov.pl

The BIEC Economic Welfare Indicator, which reﬂects the economic condition of the population, increased in 2011M1, driven by an increase in real wages accompanied by an increase in employment in the corporate sector. A threat to consumer sentiment in the coming months is posed by rapidly growing prices and a strengthening of unemployment among those registered with employment agencies for an extended period of time.

Labour market Consumer sentiment The Current and Leading Consumer Confidence Indexes (BWUK and WWUK), calculated by GUS, decreased in 2011M1 after a few months of relative stability. Th is means that January 2011 was evaluated worse in terms of individual consumption climate. Projections for 2011 are pessimistic. The Current Consumer Confidence Index, which is a composite measure of the latest trends in individual consumption, fell by 4.6 percentage points in 2011M1 in relation to 2010M12 and stood at -22.6 points. The recorded level of the index is 4.2 points lower than in January last year. The Leading Consumer Confidence Index, which describes expected trends in personal consumption in the coming months, fell by 4 percentage points from 2010M12 to -30 points. The index was 2.8 points lower than a year earlier. The drop in consumer confidence indicators was due to a deterioration in most analyzed factors determining consumer sentiment. In January 2011, consumers gave far more negative ratings than in December 2010 to expected changes in the country’s macroeconomic performance (in the next 12 months) and the same was true of ratings for major household purchases (the indicators decreased by 10 and 9.3 percentage points respectively). The eval-

The seasonally adjusted unemployment rate in Poland increased slightly in 2010M12. Business cycle-related factors have a positive impact on the labour market. However, the percentage of long-term unemployed is increasing and the deferred impact of rising unemployment during the crisis is beginning to adversely affect the labour market. Real wages are growing at a faster rate. The seasonally adjusted Harmonised Unemployment Rate (HUR) stood at 10% in Poland in 2010M12. Th is was slightly above the European Union average (9.6%) and a level similar to that in the euro area (10%). The HUR increased slightly from previous months in Poland, while in the EU it has remained stable for a year. The unemployment rates for the United States and Japan in 2010 showed downward trends that continued into 2010M12 when the ﬁgures stood at 9.4% in the U.S. and 4.9% in Japan. Among EU countries for which data were available for 2010M12, the highest unemployment rate was noted in Spain, Slovakia and Ireland, while the lowest in Luxembourg, Austria and Malta.1 In 2010M12, compared with 2010M11, the seasonally adjusted HUR increased the most markedly (by 0.3 percentage points) 1

Latest data unavailable for Estonia, Greece, Lithuania, Latvia, Romania and United Kingdom.

3/2011 :: Polish Market :: V

4.9%

4.3%

9.6%

10.0%

Japan

Netherlands

European Union

Euro area

5.0%

4.9%

Austria

Luxembourg

7.7%

6.6%

7.8%

Sweden

Czech Republic

6.2%

7.8%

Malta

8.1%

Finland

Slovenia

7.3%

8.1%

Belgium

Cyprus

8.2%

Denmark

Germany

9.4%

9.7%

France

8.6%

10.0%

Poland

Italy

10.1%

Bulgaria

United Kingdom

11.7%

10.9%

13.8%

Ireland

Portugal

14.5%

Slovakia

Hungary

20.2%

Spain

Economic Monitor

Source: Eurostat Fig. 9. Harmonized Unemployment Rate in selected countries in 2010M12

13.5 13.0 12.5 12.0 11.5 11.0 10.5 2009 2009 2009 2009 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 M9 M10 M11 M12 M1 M2 M3 M4 M5 M6 M7 M8 M9 M10 M11 M12 non-seasonally adjusted

seasonally adjusted

Source:Central CentralStatistical StatisticalOffice Office(GUS) (GUS) Source:

Fig. 10. Registered unemployment rate, %

in the Czech Republic and Hungary, where it has been growing relatively quickly since 2010M10. On the other hand, the unemployment rates in Spain, Belgium, the Netherlands and Ireland dropped, showing a slow downward trend for several months. The registered unemployment rate in Poland stood at 12.3% in 2010M12 and was by 0.6 percentage points higher than in 2010M11 and 0.2 points higher than a year earlier. Most of the growth in relation to 2010M11 is due to the impact of negative seasonal factors. The seasonally adjusted registered unemployment rate stood at 12.2% and increased only marginally over the previous month. The number of registered unemployed totalled 1,954,700 in 2010M12 and was 3.3% higher than a year earlier. Th is means a slightly faster rise in unemployment than in the previous month when the number of unemployed was 2.6% VI :: Polish Market :: 3/2011

higher than a year earlier. Among the selected groups of unemployed, the number of registered unemployed who have remained jobless for longer than a year and those who are not eligible for unemployment benefits, increased at a relatively fast rate. Moreover, in 2010 as a whole, the percentage of longterm unemployed increased by 5.5 percentage points over the previous year, standing at 46.4% at the end of 2010. Th is means that the longer lasting effects of unemployment are intensifying. Business cycle-related factors are conducive to an improvement on the labour market, but protracted joblessness of those laid off during the economic crisis produces negative implications. Even though the crisis has ended, the negative implications for the labour market are beginning to be felt more strongly today. Long-term unemployment, covering those registered with

employment agencies for at least 12 months during the last two years, may lead to a deterioration in the skills of those unemployed and make it more difficult for them to become economically active in the future, thus leading to an increase in structural unemployment. The decreasing percentage of the jobless entitled to unemployment benefits may lead to a drop in consumer demand. The number of newly registered unemployed increased by 12% in year-on-year terms in 2010M12, for both seasonal and nonseasonal reasons. The good news is that the number of unemployed taken off the official register is growing increasingly fast (it went up by 9.2% in 2010M12 in year-on-year terms). The number of those removed from the register in the wake of taking up employment is rising at a particularly rapid rate (17.5% growth in year-on-year terms). As a result, the number of unemployed registered with employment agencies after losing their jobs for reasons due to their employers, is also decreasing (a 8.6% drop in year-on-year terms). The BIEC Future Unemployment Rate Index, which provides data on expected changes in unemployment, has increased slightly in recent months, after several months of declining. However, the indicator is significantly lower than a year earlier, which testifies to an increasingly positive impact of economic trends on the labour market (excluding seasonal changes). However, unemployment may not be falling fast enough due to increasingly longer periods during which those who have lost their jobs are listed in employment agency registers and due to a relatively high level of economic activity in the last few quarters. 2010M12 was another month in a row with an increase in average employment in the corporate sector. Average employment was 2.4% higher than a year earlier, which means that the increase was greater than in the 2009M11-2010M11 period. Seasonally adjusted employment was 0.2% higher than in 2010M12, growing by around 12,700. Employment has shown a clear upward trend since the start of 2010. According to preliminary GUS data, at the end of 2010 the national labour force was larger than a year earlier. Among sectors accounting for the largest sections of the work force, average employment showed the greatest increase (compared with 2009) in the manufacture of rubber and plastic products (by 3.9%), specialised construction works (3.2%), manufacture of mo-

Economic Monitor

Table 1. Selected labour market indicators 2009M12

2010M3

2010M6

2010M9

2010M10

2010M11

2010M12

Average employment in the corporate sector, in thousands

5,255

5,294

5,336

5,364

5,375

5,381

5,379

Change in average employment, year on year, %

–2.0%

–0.6%

1.1%

1.9%

2.1%

2.4%

2.2%

3,652.40

3,493.42

3,403.65

3,403.68

3,440.22

3,525.67

3,847.91

2.9%

2.1%

1.3%

1.2%

1.1%

2.3%

Average nominal monthly wage in the corporate sector, in PLN Change in real wages, year on year, % Registered unemployment rate

12.1%

13.0%

11.7%

11.5%

11.7%

12.3%

–11.5%

25.2%

15.1%

12.6%

17.3%

11.9%

8.2%

50.4%

49.4%

50.4%

51.1%

–

Unemployment rate according to LFS (BAEL) *

8.5%

10.6%

9.5%

9.1%

–

Economic activity rate according to LFS (BAEL)

55.1%

55.2%

55.7%

56.2%

–

Change in the number of job oﬀers submitted to employment agencies, y-o-y, % Employment rate according to LFS (BAEL) *

* Quarterly data

tor vehicles, trailers and semitrailers (2.5%), metal products (2.3%), construction of civil engineering facilities (2.2%), production of goods from other non-metallic mineral raw materials (by 2.0%), and retail trade (1.6%). On the other hand, employment in the manufacture of wearing apparel (14.1%) and in the manufacture of machinery and equipment (10%) was signiﬁcantly lower than last year. A decrease was also recorded in sectors including wholesale trade (2.8%) and production of furniture (0.9%). Source: Informacja o sytuacji społeczno-gospodarczej kraju. Rok 2010, www.stat.gov.pl

The number of job oﬀers posted on the Internet in 2010M12 decreased. However, data for 2011M1 make it possible to assume that this was only a seasonal drop. At the beginning of this year, employers came up with considerably more oﬀers, thus restoring and even slightly exceeding their level from previous

Source: GUS and authors’ calculations

months. The number of job oﬀers is far larger than a year earlier. The average nominal monthly wage in the corporate sector stood at PLN3,847.91 in 2010M12. Over the year it rose by 5.4%, the fastest growth in a year. After a seasonal adjustment, the average wage increased by 3.2% in relation to 2010M11. Wages in industry and some segments of the service sector increased faster than the average for the corporate sector; slower growth was recorded in the construction industry, where pessimistic economic mood continues to prevail, and in trade. The fast growth of nominal wages led to increased real wages, despite a simultaneous acceleration in inﬂationary processes. Wages rose in real terms in 2010M12 by 2.3% in yearon-year terms, against a 1.1% increase in the previous month. Th is is a natural consequence of much faster productivity growth for some time. However, this growth may result in a slightly lower propensity to hire workers.

3,600

3,550

3,500

3,450

3,400

3,350

-1%

3,300 3,250

-2%

3,200

-3%

3,150

-4% 2009 2009 2009 2009 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 M9 M10 M11 M12 M1 M2 M3 M4 M5 M6 M7 M8 M9 M10 M11 M12 average nominal wages (seasonally adjusted, left axis) Source:Central CentralStatistical StatisticalOffice Office(GUS) (GUS) real wage change, Mt/Mt-12 (non-seasonally adjusted, right axis) Source:

Fig. 11. Wages in the corporate sector

Prices Inflation in both Poland and other EU countries is intensifying. The consumer price index in Poland increased significantly in 2010M12 and ran at a level above the EU average. The end of 2010 saw a significant increase in transport prices. Inflation expectations also increased slightly. The upward trend in the Harmonised Index of Consumer Prices (HICP) in the European Union intensified. HICP for the 2009M122010M12 period in the EU stood at 2.6% and in the euro zone it ran at 2.2%. HICP for Poland in 2010M12 was 2.9%. The indicator has been growing since 2010M9. Among EU countries, HICP has remained at a high level in Romania and Greece. Estonia, where inflationary processes increased in the last few months of 2010, joined countries with the highest HICP. Despite an increase in the HICP, among EU member states, the prices of consumer goods and services grew the slowest in Slovakia and the Netherlands (no data is available for Ireland and the UK). Cyprus has joined countries with low inflation in recent months. In non-EU European countries, the situation was different. HICP continues to run at a high level in Turkey. A rate slightly higher than the EU average was recorded in Iceland (though HICP in this country has been falling continually) and in Norway, where, after a period of low inflation, prices rose sharply in 2010M12. A lower indicator occurred in Croatia, and very low in Switzerland. According to preliminary GUS data, the year-on-year inflation rate in Poland was 3.1% in 2010M12, up from 2.7% in the previous 3/2011 :: Polish Market :: VII

Euro area 2.2%

European Union 2.6%

Slovakia 1.3%

Cyprus 1.9%

Netherlands 1.8%

Germany 1.9%

France 2.0%

Italy 2.1%

Sweden 2.1%

Austria 2.2%

Slovenia 2.2%

Czech Republic 2.3%

Latvia 2.4%

Portugal 2.4%

Finland 2.8%

Denmark 2.8%

Spain 2.9%

Poland 2.9%

Luxembourg 3.1%

Belgium 3.4%

Malta 4.0%

Lithuania 3.6%

Bulgaria 4.4%

Greece 5.2%

Hungary 4.6%

Estonia 5.4%

Romania 7.9%

Economic Monitor

Source: Eurostat. No data available for Ireland and United Kingdom Fig. 12. Harmonized Index of Consumer Prices in EU countries, 2010M12, Mt/Mt-12

5% 4% 3% 2% 1% 0% -1% -2% -3% 2009 2009 2009 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 M11 M12 M1 M2 M3 M4 M5 M6 M7 M8 M9 M10 M11 M12 inﬂation

industrial prices

construction prices

Source:Central CentralStatistical StatisticalOffice Office(GUS) (GUS) Source:

Fig. 13. Producer and consumer prices in Poland

4.1%

3.9% 2.9%

2.8%

2.5%

0.8%

0.7%

recreation and culture

home furnishings

other goods and services

education

health

restaurants and hotels

alcoholic beverages and tobacco products

cost of housing (rent and utilities)

transport

1.7%

communications

4.5%

clothing and footwear

6.9%

-0.3%

-2.6%

Source: Central Statistical Office (GUS) Fig. 14. Change in prices of selected consumer goods and services in 2010M12, Mt/Mt-12

VIII :: Polish Market :: 3/2011

month. Changes in the prices of most groups of consumer goods and services in 2010M12 were faster than in 2010M11 in year-on-year terms. As in previous months, food and energy prices contributed the most to the price growth. Core inflation excluding food and energy prices stood at 1.6% year on year in 2010M12. Among consumer goods and services, prices of transport and energy as well as the cost of housing (rent and utilities) grew the fastest. A particularly sharp increase in the rate at which prices grew was recorded in transport—by 6.9% year on year, compared with 3.7% a month earlier. In the case of food and non-alcoholic beverages as well as health products and services, the price increase was slightly slower than in 2010M11, yet still relatively fast. Inflationary trends were offset by falling prices of clothing and shoes as well as communications services, which, however, fell at a slightly slower rate than in 2010M11. The prices of products and services related to recreation and culture started to rise slowly in 2010M12. In 2011M1, for another month in a row, the inflationary expectations of individuals increased. The expected inflation rate for the next 12 months was 3%, against 2.9% a month earlier. The detailed results of a survey from the previous month showed that the percentage of respondents who said that prices would grow at a faster rate than at present, increased the most—by 2.1 percentage points. The percentage of respondents predicting a higher inflation rate stood at 26.4%. The highest percentage of those polled, 46.5%— 5.9 percentage points less than in the previous survey—predicted that prices would rise at the same rate as today. The percentage of those saying that prices would grow at a slower rate than at present was 14.8%. Finally, 4.5% of respondents said that prices would be the same or lower than today; the remainder were undecided. The BIEC Future Inflation Index, which provides data on consumer goods and service prices several months in advance, rose again in 2011M1. A downward inflation trend that appeared in the early autumn of last year proved to be short-lived. The indicator returned to a more permanent path that has been in place for over a year and involves an intensification in inflationary processes in the economy. Cost-related factors have contributed the most to stronger inflationary pressure. Demand-related factors are also adding

Economic Monitor

to the inﬂationary pressure, though their impact is slightly smaller.

Table 2. Selected data on monetary policy and currency exchange rates Position

Source: www.biec.org

Producer prices increased at a faster rate in 2010M11 in year-on-year terms than in previous months. Th is was largely due to higher prices of energy and intermediate goods as well as rising wages. Producer prices increased by 4.7% in 2010M11 in year-on-year terms, compared with a 3.9% rise in the previous month. Th is was the fastest increase in producer prices throughout 2010, driven by an increase in both wages and demand. Prices in construction had grown at a very slow rate for several months, and in 2010M11 they remained at a level similar to that in the previous year. The accelerated growth of producer prices was primarily due to the prices of energy-related goods, which have continually been growing at a fast rate (rising by 13.5% year on year), and the prices of intermediate goods (a 6.9% increase in year-on-year terms). The prices of non-durable consumer goods grew at a slow though slightly faster rate than a month earlier (0.8% year on year), while the prices of capital goods and durable consumer goods fell in the 2009M11-2010M11 period. Factors contributing to the increased prices of energy-related goods include growing prices of energy raw materials worldwide and growing global demand for energy as economies across the world—including China and the United States as well as EU economies, among them Poland—are beginning to recover. In addition, plans to maintain oil production quotas by OPEC countries may lead to further increases in energy prices in 2011. In connection with higher demand, the prices of capital goods are falling at a slower rate. For similar reasons, the prices of durable consumer goods are likely to decline further in the near future, in a trend that is expected to be brought about by factors including a decrease in the percentage of jobless individuals eligible for unemployment beneﬁts. In the case of prices in construction, no signiﬁcant changes have been observed in recent months. In 2010M11, as in previous months, the prices of production related to the construction of civil engineering facilities continued to rise slightly (an increase of 0.5% year on year) and the same was true of

M3 money supply in billions of PLN

2010M12

2010M11

2009M12

2010M11

782.2

763.3

720.3

699.8

Average NBP USD/PLN exchange rate at end of month

2.9641

3.1308

2.8503

2.7538

Average NBP EUR/PLN exchange rate at end of month

3.9603

4.0734

4.1082

4.1431

n/a

663.1

635.0

606.6

Total deposits in billions of PLN at end of month Source: GUS

the prices of products related to specialised construction works (a 0.3% increase year on year), while the prices of products related to the construction of buildings decreased (by 0.5% in year-on-year terms).

Central bank and monetary policy This year’s first meeting of the Monetary Policy Council (RPP) took place on Jan. 18-19. The Council decided to increase the central bank’s interest rates by 0.25 percentage points. The reference rate rose to 3.75%, the Lombard rate increased to 5.25%, the deposit rate went up to 2.25%, and the rediscount rate hit 4.00%. According to the Council, faster economic growth, by contributing to an improvement on the labour market, may lead to a gradual increase in wage and inflationary pressures in Poland in the medium term. At the same time, a strong increase in the prices of commodities on international markets—at a time of economic recovery— leads to the risk of inflationary expectations staying at a continually high level. To reduce the risk of inflation staying above the inflation target in the medium term, the Council decided to raise the NBP interest rates. At the same time, the Council said it would continue to analyze potential signals pointing to rising inflationary pressure.” (Source: www.nbp.pl).2 A report published after the Council’s meeting highlights the revival in the global economy, particularly data for the United States and the euro area pointing to a stable moderate rate of growth in economic activity. The report also points out that Germany, a country that is Poland’s key trading partner, continues to enjoy favourable economic trends. However, economic growth in most developed countries is limited by a high 2

NBP; Report released after the RPP’s meeting; Warsaw, January 19, 2011.

level of unemployment and fi nancial adjustments in companies, households and fi nancial institutions. In emerging economies, attempts to tighten monetary policy have been observed, designed to reduce rising macroeconomic imbalances. The Council’s decision may have also been influenced by a strategy pursued by some countries and based on enhanced monetary expansion and by unconventional activities undertaken by major central banks. The Council’s decision has also been influenced by data on rising prices of raw materials such as oil as well as rising food prices, which have added to inflation in most countries worldwide. Source: www.nbp.pl

Lending to companies remains limited, mainly due to relatively low demand for credit among businesses. On the other hand, lending to households continues to increase. Source: www.nbp.pl

The Consumer Price Index (CPI) in 2010M12 rose to 3.1%, staying above the NBP’s 2.5% inﬂation target. Source: www.nbp.pl

The RPP believes that the CPI will continue to run high, due to earlier strong growth in food prices and rapidly growing fuel prices. Inflation may also be stimulated by an increase in most VAT rates in 2011. The Council’s decision was additionally influenced by developments in public fi nances. The Council set out to help reduce the public fi nance deficit and stop the growth of public debt—a move indispensable for macroeconomic stability and for meeting the euro adoption criteria by Poland. Source: www.nbp.pl

According to the Council, the decision to increase interest rates was additionally designed to reduce the growth of foreign-currency lending to households, which may help 3/2011 :: Polish Market :: IX

Economic Monitor

increase the eﬃciency of the monetary transmission mechanism. In a document of January 19, 2011, the Council says it looks forward to the adoption of measures designed to reduce the supply of new foreign-currency loans to households. Source: www.nbp.pl

The WIBOR 3M interest rate stood at 3.95% at the end of 2010M12 and did not exceed 4% until 19 January. On January 20 it rose to 4.08%. At the end of 2011M1, the WIBOR 3M rate was 4.09%. In 2010M12, M3 money supply grew by 2.5% over 2010M11 and by 8.6% compared with 2009M12.

Table 3. Changes in stock market indexes in 2011M1 Index

Closing January 31, 2011

Closing December 31, 2010

MWIG40

2825.92

2805.26

NCINDEX

61.29

63.44

NCXLIFESCI

91.08

98.85

RESPECT

2286.48

2259.2

SWIG80

12525.07

12219.94

WIG

47156.76

47489.91

WIG-BANKI

6737.23

6921.28

WIG-BUDOW

5155.84

5400.33

WIG-CHEMIA

6408.57

5156.38

WIG-DEWEL

2461.19

2709.52

4251.3

4314.39

WIG-ENERGIA

Trends on the Warsaw Stock Exchange A new session schedule has been in eﬀect on the Warsaw Stock Exchange since 2011M1. January saw three new main market listings and the highest ever trading in WIG20 options. The Warsaw Stock Exchange entered 2011 with changes in its session schedule. The continuous trading phase was extended for shares and cash market instruments, including bonds. Trading sessions now close at 5:20 p.m., 70 minutes later than in the previous schedule. Post-auction trading on the stock market has been shortened to 5 minutes. The derivatives market opens at 8:30 a.m. (same as before), and will ultimately close at the same time as the continuous trading of shares. Th ree new companies hit the main stock market: cardboard and paper packaging supplier BSC Drukarnia Opakowań on January 4, rustproof insulation producer Izostal on January 11, and Wadex, a company that makes exhaust systems from stainless and acid-proof steel, on January 12. In 2011M1, turnover on the WIG20 options market was the highest in the Warsaw Stock Exchange’s history. A total of 86,721 options were traded during the month (Source: www.gpwcatalyst.pl). The previous record was 84,944 options in 2010M3. The market grew more than 60% in 2010.

Balance of payments

WIG-INFO

1252.78

1221.85

WIG-MEDIA

3652.4

3792.19

WIG-PALIWA

3211.69

3079.41

WIG-PL

46289.38

46737.15

WIG-SPOZYW

4771.12

4536.52

WIG-TELKOM

1300.89

1271.86

WIG20

2704.86

2744.17

WIG20LEV

1465.85

1516.4

WIG20SHORT

2553.66

2510.14

WIGDIV

1002.67

–

Source: WSE

Table 4. Components of the balance of payments 2009M11 Current account Balance on goods Balance on services Balance on income Balance on current transfers Capital account

X :: Polish Market :: 3/2011

-1 637

-2 286

-266

-1 254

277

440

-1 310

-1 218

-338

-254

395

159

2 523

3 509

-51

-363

Foreign direct investment in Poland

-199

-634

Portfolio investment assets

-233

173

Financial account Polish direct investment abroad

Portfolio investment liabilities

502

1 508

Other investment assets

1 093

284

Other investment liabilities

1 370

2 652

Financial derivatives Net errors and omissions

Preliminary NBP and GUS data on the balance of payments in 2010M11 show a current-

2010M11

Official reserve assets Source: NBP

-111

-1 097

-1 653

-184

271

Economic Monitor

account deficit of EUR2,286 million (up from EUR1,637 million in 2009M11). The figure results from a deterioration in the balance on goods and a better balance on income than in 2009. The balance on goods showed a deficit of EUR1,254 million in 2010M11 (compared with EUR266 million in 2009M11), and the balance on income showed a EUR1,218 million deficit (EUR 92 million more than in the same month of 2009). The value of exports shaping the balance on goods increased by 16.9% over the year, while imports grew by 26.8%. The balance on services in 2010M11 was EUR440 million, compared with EUR227 million in 2009M11. The EUR440 million balance on services comprised a EUR215 million surplus for transport services and a EUR199 million surplus for foreign trips. Revenue from the export of services totalled EUR2,238 million in 2010M11 (an increase of 27.5%), and service imports amounted to EUR1,798 million (an increase of 21.7%). The improved balance on incomes was due to a 97.3% increase in revenues, which totalled EUR511 million. The direct revenue of foreign investors from their capital involvement in Polish businesses amounted to EUR1,037 million. The balance on current transfers showed a EUR254 million deficit in 2010M11 (versus EUR338 million in 2009M11). Revenue amounted to EUR455 million and expenditure totalled EUR709 million, falling 50.7% and 43.7% respectively from a year earlier. The capital account showed a EUR159 million surplus in 2010M11, down from EUR395 million in 2009M11. The fi nancial account showed a surplus of EUR3,509 million in 2010M11 (EUR2,523 million in 2009M11). The balance on foreign investment was EUR3,526 million, with foreign direct investment in Poland at -EUR634 million and Polish investment abroad at -EUR363 million. The portfolio investment account showed assets worth EUR173 million and liabilities at EUR2,652 million. Other investments showed assets of EUR284 million and liabilities of EUR2,652 million. Financial derivatives showed a balance of -EUR111 million. The value of reserve assets decreased by EUR271 million in 2010M11; reserve assets stood at EUR74,219 million at the end of the month. Source: NBP and GUS

National budget

data for 2010M1-11, tax revenue decreased at a slightly faster rate in year-on-year terms than in the 2010M1-10 period, while nontax revenue increased at a much slower rate. Among tax revenues, those from indirect taxes grew faster, while those from income taxes fell more slowly. In the case of expenditure, spending on domestic debt service grew at a slower rate, while spending on foreign debt service rose slightly faster. Unlike in 2010M110, in 2010M1-11 spending increased on settlements with the EU budget involving “own revenue.”

The budget deficit for the 2010M1-11 period was PLN42.5 billion; it increased by PLN704.7 million in comparison with the 2010M1-10 period. The target for 2010 as a whole provided for a deficit greater by PLN10 billion. In the 2010M1-11 period, government revenue totalled PLN226.9 billion, while expenditure was PLN269.5 billion. In 2010M11, government revenue increased by PLN22.6 billion, while expenditure rose by PLN23.2 billion. Actual revenue in relation to the target for 2010 increased from 82.1% to 91.1%, while actual expenditure increased from 81.7% to 89.5%. Compared with the same period a year earlier, in 2010M1-11 actual government revenue was 0.8 percentage points lower and actual expenditure was 2.3 percentage points lower. In the 2010M1-11 period, the rate at which government revenue and expenditure grew in year-on-year terms decreased compared with the 2010M1-10/2009M1-10 period. However, the growth of the budget deficit accelerated from 73.9% to 74.2%. Considering the

Public debt stood at PLN746.1 billion at the end of 2010M9, against PLN721.2 billion at the end of 2010M6. At the end of 2010M9, public debt was 13.1% higher than a year earlier, down from 13.5% at the end of 2010M6. The slower growth of public debt is due to a slower increase in government sector debt, which accounts for the largest proportion of the overall public debt. Government sector debt increased by 11.6% year on year, against 12.1% at the end of 2010M6. Local government sector debt increased at the same rate as in

Table 5. Government revenue and expenditure according to preliminary data In PLN billions

% of annual target

2010 Budget Law

2010M1-10

2010M1-11

2010M1-10

2010M1-11

Revenue

249.0

204.4

226.9

82.1%

91.1%

Expenditure

301.2

246.2

269.5

81.7%

89.5%

Deﬁcit (–) / Surplus (+)

-52.2

-41.8

-42.5

80.1%

81.4%

Source: Ministry of Finance, December 15 2010

269.5

226.9

actual ﬁgure for 2010M1-11 expenses

246.2

204.4

actual ﬁgure for 2010M1-10 revenues

301.2

249.0

2010 target after revision Source: Ministry of Finance

Fig. 15. Government revenue and expenditure, in PLN billions

3/2011 :: Polish Market :: XI

Economic Monitor

2010M6—39.3% year on year. Social security sector debt, which accounts for a small portion of the budget, increased by 41.6% in yearon-year terms at the end of 2010M9, against 30.4% three months earlier. The Treasury’s domestic debt has been growing at an increasingly rapid rate for several months. In 2010M10, this debt amounted to PLN515.3 billion and was 11.1% higher than a year earlier (10.3% at the end of 2010M9). Short-term debt is falling in favour of medium-and long-term debt. Debt to foreign investors is growing particularly fast (a 61.2% increase in year-on-year terms). The Treasury’s foreign debt continues to grow but this growth is decelerating. In 2010M10, the Treasury’s foreign debt amounted to PLN194.3 billion and increased by 12.9% from a year earlier, versus 15.8% in 2010M9. According to original maturity periods, medium-term debt is growing at the fastest rate. Although foreign debt is still higher than a year earli-

XII :: Polish Market :: 3/2011

er, debt resulting from government bonds has decreased for two months. One of the main objectives of fiscal policy is to reduce the budget deficit and slow the growth of public debt. Th is policy is expected to result in increased public fi nance discipline and, in particular, in a reduction in government spending.

Notes It is always clearly stated in the text if the data given are seasonally adjusted or in cumulative terms. Otherwise, the data are nonseasonally adjusted and in non-cumulative terms. GUS and Eurostat use the TRAMOSEATS procedure for seasonal adjustment. Time series cleared from the impact of seasonal factors by the authors of the report have been adjusted using the ARIMA X-12 method. 2010M12 – December 2010

2010Q4 – fourth quarter of 2010 2010H2 – second half of 2010 2010M1-12 – cumulative data for the January-December 2010 period 2010Q1-4 – cumulative data for the period from the 1st to the 4th quarters of 2010 Mt/Mt-12 – rate of change for a given month compared with the same month a year earlier Mt/Mt-1 – rate of change for a given month compared with the preceding month Qt/Qt-4 – rate of change for a given quarter compared with the same quarter a year earlier Qt/Qt-1 – rate of change for a given quarter compared with the preceding quarter Compiled by a team of experts comprising: Robert Pater, PhD Łukasz Cywiński, and Tomasz Soliński, PhD Institute of Economics, University of Information Technology and Management in Rzeszów www.ig.wsiz.pl

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