NEWSLETTER AUGUST 2005 15 July 2005 - 15 August 2005 No 15 Publication prepared by the Polish Information and Foreign Investment Agency

Employment should exceed 500 people. Latest information: POLISH SECTORS „The firm represents tire manufacturing sector. In this field becomes an Form of polish automotive sector unquestionable European leader. In the An automotive sector is the significant Boom in automotive sector past Poland attracted investments of part of Polish industry. It has achieved in Poland part 2 other major representatives of this sector, record results in 1999 by dint of con- such as Bridgestone and Goodyear. Posi- stant growth of production up to 715,000 Automotive supply chain tive decision of Michelin is the reflection of and sale up to 640 000 cars and vans. As a result of snowball effect following au- Poland’s investment attractiveness. The tomotive investments (or re-investments) company participated in the privatization FIAT&GM turbo drive are stimulating development of compa- of domestic tire maker Stomil-Olsztyn An investment related to beginning Turbo nies and creation of new jobs. Currently S.A., which brought about positive finan- Diesel 1.3 SDE car engine production in there are over 700 companies (ca. 200 cial results and high efficiency of produc- Bielsko Biała has absorbed almost 370 obtained ISO/TS 16949 certificate) - sup- tion and thus convinced the firm to further million euro with over 1,300 employees. pliers of the automotive sector - with the invest in Poland. The plant will be techno- A huge demand for 1.3 SDE engines share of both Polish and foreign capital. logically advanced, which will be important causes the plant will achieve full produc- Their list includes for instance six plants not only due to the anticipated transfer tion abilities faster then it was planned. of car engines e.g. of Isuzu in Tychy, Opel of technology and know-how to Poland, and FIAT-G.M. Powertrain in Gliwice, To- but it will also positively affect economic New Investments in automotive sector yota in -Laskowice and Wałbrzych, development of Warmia and Mazury re- An amount of new overseas investments and Volkswagen Motor in Polkowice. gion. Tire sector will indirectly contribute into the polish automotive sector is still Poland is also a leading manufacturer of: to the creation of a large number of jobs increasing. Only in 2004 almost 9% of components for engines, metal pressed in the region due to its high demand for invested capital was connected with the parts, aluminum castings, rubber and pla- components,” announced Sebastian Mi- branch. It makes the automotive sector le- stic parts, manufacturing of dies and forms. kosz, Executive Vice President of PAIiIZ. ading one in the whole productive sector. Components manufactured in Po- land are later assembled in cars, such Earlier also Goodyear and Bridgesto- As the project “The map of the Po- as Mercedes, Nissan, Opel, Porsche, ne decided to shift its manufacturing lish automotive sector” is already Toyota, Volkswagen, Isuzu, Fiat, Ci- facility to Dębica and Poznań respec- recognizable and identified as a troen, Honda, Peugeot, Volvo, BMW, tively. Poland is one of the largest tyre reliable source of information, Polish In- Rolls-Royce, Lamborghini, Ferrari. producer in Europe. According to www. formation and Foreign Investment Agen- opony.pl Polish tyre market analyst, the cy (PAIiIZ) has taken patronage over it. Poland - Emerging leader internal market will grow in 2005 by 3% For the most up-to-date information in trucks, vans, busses in comparison to the year before amo- concerning investments in the auto- and coaches manufacturing unting 7.6 million pieces. According to motive sector in Poland please visit Central Statistical Office Polish output www.motogazeta.mojeauto.pl/mapa Automotive companies located in Poland capacity amounted to 33.6 millions tyres not only deliver passenger cars and va- for the period January-November 2004. POLISH ECONOMY riety of components to internal market, but also export vans, buses and trucks. Currently PAIiIZ is working on 6 lar- ge automotive investment projects and It amounted to almost 100,000 units in Powered by Warsaw Independent 2004. The list of major bus and trucks about 15 smaller projects. The value of manufacturers include FSO in Warszawa, the projects has to exceed EUR 50 mil- Opel Poland in Gliwice, Volkswagen in lion and create at least 500 new jobs. Poznań, Intrall in , MAN Star Trucks If all of them were concluded with a in Starachowice and in Poznań, Jelcz in positive investment decision, they wo- Jelcz-Laskowice, in Sanok, So- uld directly create at least 15,000 jobs. laris Bus & Coach in Bolechowo, Volvo Poland’s Inflation at 1.4% YY in June Poland in Wrocław, Scania in Słupsk. MAP OF THE POLISH The Polish consumer price index was Polish commercial vehicles market is still at 1.4% in June, the Central Statisti- too small as for the potential of the Po- AUTOMOTIVE SECTOR cal Office (GUS) said. Consumer pri- lish economy. Having in mind rising trade ces dropped 0.2% versus May 2005. The market expected the inflation of between Poland and the EU, the growth Poland has strengthened its position as potential of the Polish truck market is very 1.5% yoy, down from 2.5% in May, with one of the countries with the fastest gro- the range of forecasts at 1.4-1.8%. big. Polish market is likely to retain high wing economy in Central and Eastern Eu- growth dynamics in the next few years. rope. Substantial growth of investments Poland’s Unemployment Rate at 18% concluded in Poland by large multinatio- in Jun., Prev. 18.3% Tyre sector nal automotive sector suppliers causes increasing interest with this branch of the Poland’s unemployment rate was at Attractiveness of Poland for automoti- Polish industry. The project “Map of the 18% in June, down from 18.3% in May, ve sector investors has recently been Polish automotive sector” which is run by the Central Statistical Office (GUS) said confirmed by a decision of Michelin to Internet site www.mojeauto.pl is beco- Monday, July 25. The number of those invest EUR 253 million in the Warmiń- ming popular among individual Internet out of work was at 2,827,400, down by sko-Mazurska Special Economic Zone. users, as well as executives of companies.

Polish Information and Foreign Investment Agency POLSKA39,900 or AGENCJA 1.4% since INFORMACJI end-May. Compa - EUR 1.1bn, a report from market ad- Investment of Volvo in Poland red with June 2004, the number of those visory firm IDC said Monday, July 18. outI INWESTYCJI of work in Poland ZAGRANICZNYCH was lower by 7.9% . The organization expects the growth of 14.6% in 2005 and 14.8% in 2006. „Gi- S.A. Poland Tops Europe ven the diminishing margins on hardwa- for Investment Attractiveness re and software, many big-name vendors are bolstering their IT services offerings. Poland holds the fourth place in the Nevertheless, the market remained frag- world and the first in Europe with respect mented, with local players dominating the to attractiveness for investments, said scene and the top 20 vendors accounting Ernst & Young in its European Attrac- for just over 62% of spending in Poland tiveness Survey. „[Poland’s] attractive- in 2004. While HP and IBM ranked first ness was indicated by 17% of respon- and second in revenue on the Polish IT dents, which allowed it to overtake the services market last year, only three inter- three best European countries so far, national players in total broke the top ten. Seat of Volvo in Wrocław that is Germany, the United Kingdom (Accenture took fifth),” the report states. and France,” said Danuta Janczak, the Volvo will invest PLN 26 million in the deputy president of company’s board. creation of accounting and IT system in FOREIGN DIRECT INVESTMENTS Wrocław. The new centre will employ POLICY MAKERS/ OPINION 500 persons who will provide services to MAN Nutzfahrzeuge AG chose the whole group of Volvo AB in Europe. Agreement signed between the Economy IMF Praises Poland, Encourages Fiscal Re- Niepołomice for the location and Labour Ministry and Volvo will allow form In its first year in the European Union, of its new trucks plant Poland has shown its mettle and export the creation of a Complex Financial-Ac- growth remained buoyant and FDI picked counting and Development of Information up sharply, rendering a solid external po- Technologies Centre LLC in Wrocław. Management of MAN Nutzfahrzeuge AG sition stronger, the International Monetary Among the employed will be mostly decided that the additional trucks assem- Fund (IMF) said. Policymakers successful- young persons in the age of 25-34, which bling plant will be constructed in Kraków. ly coped with accession-related price and will help lower the unemployment rate in After all works are completed production demand shocks, the organization said. The the Lower Silesia in this age group (cur- capacity will stand at 15,000 vehicles IMF said, however, that the Polish govern- rently at 26.3%). Investor also declared annually, which will allow employing 650 ment must continue fiscal reforms in other that majority (40%) of the employees to use the country’s economic potential. persons. Planned investment outlays will stand at between EUR 90-100 million. will be taken on via Poviat Labour Office (PUP) in Wrocław. The new investment AUTOMOTIVE Signing an agreement concerning the construction of the plant will take pla- will result in growing turnover and thus ce on 16 August in Poland. Construc- employment among entities co-operating Poland’s Car Production Up 35% MM with the centre. It is estimated that thanks in June 48,061 passenger cars were tion works will be commenced already in fall 2005. The first vehicles should to the investment roughly 50 new jobs made in Poland in June, up nearly 35% will be created in the close environment. versus May, and 0.5% down versus the be completed by the middle of 2007. corresponding period of last year, the German investor to construct research company, Samar, said in a a plant in the LSEZ statement. On the cumulative basis, Po- Electrolux to construct a new land’s car production reached 258,806 plant in Świdnica units through June, down 5.7% year- -on-year. The country’s car production continued to be driven by healthy export demand, particularly in Western Europe, Samar said. Of the 48,000 units built in June, 45,669 cars, or over 93% of the The Swedish group Electrolux intends total, were delivered to foreign markets. to construct a facility producing co- okers. Total value of the investment is estimated at around EUR 40 million. TELECOMMUNICATION Roughly 460 people will be employed. On 18 July 2005 tender procedures were The ceremony of granting the permit Sales of Mobile Phones in Poland to Rise completed. Electrolux Poland Sp. z o.o. for commencing business activity 15-20% in 2005 Analysts of Gfk Polonia will purchase a 30 ha plot in Świdnica, sub- expect that this year’s sales of mobile zone of the Wałbrzych Special Economic On 2 August 2005, Kühnl Polska Sp.z phones will rise by 15-20%. In their opi- Zone Invest-Park. The firm will construct a o.o., received a permit for commencing nion, some 5m mobile phones will be manufacturing facility, which will produce business activity in Złotoryja, a subzo- sold every years in Poland, the company cookers designated for the Polish market ne of the Legnica Special Economic said in a report. Gfk Polonia’s IT market as well as for export. The commencement Zone. Kühnl will construct and equip analyst, Krzysztof Pawlak, said in the of production is planned for March 2007. a PLN 2.8 million plant, which will ma- report the strong increase of sales may The construction of a plant in Świdnica is nufacture elements for cabrio cars. continue in the future as users will be the next large investment of Electrolux Gro- Subsidiary of a German company Kühnl replacing their units with newer models. up, one of the world’s largest producers of GmbH Stanz und Umformtechnik purcha- Report: Polish IT Services Spending Re- white goods, in Poland. In 2004, the com- sed a 1 ha plot. The constructing works aches EUR 1.1bn in 2004, Up 28.6% YY. pany commenced the investment in Ża- will be commenced later this year. The The Polish market for IT services picked rów (production of dishing machines) and production of components for convertible up in 2004, as spending rose 28.6% to in Siewierz (production of tumbler driers). tops will be commenced by the end of 2006.

Polish Information and Foreign Investment Agency New investment of Wrozamet -art, manufacturing facility was built in city also add to our high standards and in Poland Wrocław. The Polish facility will be one business expectations of further expan- of 3M’s most advanced, hi-tech plants ding our Polish manufacturing base here.” and the prime supplier of synthetic cast - says Managing Director of 3M Poland. for 3M worldwide. The estimated value of the project amounts to USD 30 million. Headquartered in St. Paul, Minnesota, 3M Company is a diversified industrial „During the two years that passed after the materials supplier, producing adhesives, acquisition of Viscoplast we gained the full bonding materials, coatings and specialty trust of our Board. In Poland we are manu- materials with operations in over 60 coun- facturing the highest quality products. Our tries. It employs 67,000 people and sells plant in Wrocław has become the reliable its products in 200 countries worldwide. and proven supplier to 3M worldwide” - Wrocław and Lower Silesia has become Facility of Wrozamet in Wrocław says Piotr Freyberg, Managing Director of the top FDI destination in Poland in the re- 3M Poland Sp. z o.o. In 2004 American cent years. The City offers the one-stop- On 15 July, headquarters of the Po- company completed the engineering team -shop for investors while its world class lish Information and Foreign Investment for the new plant. Now it is recruiting 60 business environment is constantly pro- Agency (PAIiIZ) hosted the ceremony of technicians and production staff. „We are ven by the new project announcements. signing agreement with Wrozamet S.A. looking for motivated, technically gifted Only July 2005 brought two major expan- concerning its new investment project in and teamwork-oriented individuals who sions of happy foreign investors: Volvo Wrocław. The company, which is a sub- will show the initiative” - adds Radosław AB (share service centre, 500 new jobs) sidiary of Spanish Fagor Electrodomesti- Majda, HR Director of and Fagor Electrodomesticos (domestic cos, will construct and expand its white 3M Poland. The whole appliances, 1000 new jobs). Intense sup- goods factory. The investment, which va- process is supported port from the mayor Rafał Dutkiewicz and lue amounts to EUR 31 million, will cre- by the committed Wro- continuous commitment and efforts put ate 1,000 new jobs by the end of 2008. cław Labour Office. forth by the city authorities makes all fore- Wrozamet will provide training for all 3M started its activi- ign investors strongly recommend invest- new employees. The construction of new ty in Poland in late ment in Wrocław for any potential foreign Wrozamet factory in Poland is another 60s and early 70s. investor interested in this part of Europe. step to build a stable production infra- It opened its Polish structure and strengthen its position on subsidiary in 1991 foreign markets. Having broad access and sales office in to Western markets, due to member- 1997. In 1998 3M Poland moved to its ship in MCC, Wrozamet products are new headquarters in Kajetany near War- becoming another export hit of Poland. saw. In December 2001 3M paid PLN 63 million to acquire Viscoplast SA in Wro- cław, a leading Polish manufacturer of CASY STUDY sticking plasters, surgical dressings, ope- rative foil, dressing and healing plasters. 3M recruits staff for its new 3M has invested approximately USD 80 New manufacturing facility of 3M Poland plant in Wrocław million in the country so far. It currently in Wrocław employs 550 people. American investor 3M has started hiring people for its new is famous in Poland for its strong commit- CALENDAR USD 30 milion plant in the capital of Lo- ment to road safety, talent development of its Polish employees, constant innova- wer Silesia. Due to re-locating production Press Conference „Foreign from France, Japan and the United States tion and corporate social responsibility. investments in Poland, to Poland, 130 new jobs will be created. chances and perspectives”.

On June 29 Ernst & Young and Polish Information and Foreign Investment Agency were hosts of the press confe- rence “Foreign investments in Poland, chances and perspectives”. The con- ference took place at PAIiIZ premises. During the conference were presented results of two latest researches convey- Headquarters of 3M Poland Sp. z o.o. in ed by Ernst & Young – reports: „Eu- Kajetany near Warsaw rope’s investment attractiveness” and „German barometer of small and me- In January 2004, 3M Medical Division dium enterprises. According to the report Groundbreaking ceremony decided to shift all global manufactu- Poland is perceived as one the most at- tractive countries for foreigh investors. ring of Scotchcast™ (synthetic cast) to Piotr Freyberg emphasizes that 3M’s Wrocław. The whole process of consoli- most positive experiences in Poland have dating production from three continents a lot to do with Wrocław. „From the very UNICE Seminar, SME access in Poland should be concluded within beginning our dynamic growth in Poland to finance: a better understanding two years. In the first stage 3M reloca- was supported by the mayor and most tes production from Pithiviers in France, engaged and competent Wrocław autho- On September 27, in Brussels will take then from Irvine in the United States and rities. The remarkable beauty and unique place semirar organized by UNICE. The Yamagata in Japan. A new, state-of the- atmosphere of the Lower Silesia capital participants of the seminar - the repre-

Polish Information and Foreign Investment Agency sentatives of companies, bsiness orga- stics managers of productive and trade they have to not only be active and present nizations, the representatives of Euro- companies, as well as logistics, transport, on the world markets, but also overcome pean Institutions (Council, Commission freight and courier service companies. cultural barriers, strive for new and inno- and European Parliament ) will have the The event will be orgaznized for pro- vative solutions and to support reforms opportunity to ask questions to the pa- fessionals, who will exchange their aiming at accelerating economic growth nel of experts and give their own views. views and experiences on their suc- and increasing the number of new jobs. In the European Union, nine out of ten cess in business. It will also be an oc- Participation in the Competitiveness Day companies are small or medium-sized casion to talk about latest trends, chal- is an opportunity for entrepreneurs from enterprises. They provide aomost two lenges for them in Poland and abroad. all European contries to meet together out of every three jobs. They are dri- and exchange their opinions and views. ving force of European growth and job UNICE Third Competitiveness Day It is also a great occasion to discuss with creation.UNICE, representing almost the most influential and important poli- 20 million entrepreneurs and small and UNICE is to hold its third Competitive- ticians and European decison-makers. medium-sized companies is organising ness Day in Brussels on 20 October. this seminar to state their concern about The theme of this year is “ Crossing accessing finance and push for change. Frontiers” and addresses the reality that NEWSLETTER PREPARED BY businesses increasingly have to operate III Forum of Polish Logistics against a global backdrop. Among other Polish Information and Foreign Managers – Pollog 2005 aspects, modern communication techno- Investment Agency logies mean tht range of activities can be PL 00-585 Warsaw, 12 Bagatela Street On October 13-14 will take place III Forum conducted omost anywhere in the world. Tel.:(+48 22) 334 98 00, Fax: 334 99 99 of Polish Logistics Managers organized by E-mail: [email protected], the daily newspaper „Puls Biznesu” and The talks will concentrate on activities of www.paiz.gov.pl Polish Logistics Managers Association. European entrepreneurs in a global eco- Forum Pollog will be addressed to logi- nomy. To retain their competitive position