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POLAND


 

 

In-depth Business Intelligence

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 209,563 187,670 176,300 24
         
GNI per capita
 US $ 5,270 4,570 4,230 71
Ranking is given out of 208 nations - (data from the World Bank)

Books on Poland

REPUBLICAN REFERENCE

Area (sq.km) 
312,685

Population 
38,626,349

Capital
Warsaw

Currency 
Zloty 

President 
Aleksander 
Kwasniewski 

Private sector 
% of GDP 
70%



Update No: 107 - (28/04/06)

Political crisis continues
In Poland, the government has been struggling for support in the lower chamber since the parliamentary elections in October 2005. The minority government of the Law and Justice Party has only managed to stay in power on the basis of a 'stability pact' signed with the populist Self-Defence Party and the nationalist-catholic League of Polish Families. An official coalition between the parties, due after the Easter holidays, might stabilise the political system, but opens questions about the positioning of Poland in the EU. 
A new coalition agreement might result in the resignation of the Prime Minister Kazimierz Marcinkiewicz and the minister of foreign affairs, Stefan Meller. It would unite parties with strongly divergent political backgrounds and economic policies, thus rendering its stability uncertain, and possibly leading to early elections. 
The new coalition would most probably strengthen the anti-EU stance of the government, and therefore the reputation of Poland as a eurosceptic member and a tough partner in the European Union. It will also raise questions about the financial stability of the country. Poland is the only country among the newcomers that has not yet set a final timetable for introducing the euro and the new coalition will be reluctant to prepare Poland for the common currency.

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Beacon of freedom
Sometimes the great leader of a nation becomes a beacon of freedom and a symbol of salvation for mankind. Such a one was Winston Churchill in the Second World War - but also afterwards in the Cold War, of which he sounded the tocsin with his Fulton Speech in March, 1946 in Missouri.
He felt especially guilty about Poland, for whose independence the Western powers had gone to war in September, 1939. Yet victory in the war did not bring liberation for Poland - just subjugation to a new form of totalitarian tyranny in Communism. "From Stettin in the Baltic (in Poland) to Trieste in the Adriatic (in former Yugoslavia) an iron curtain is descending across Europe."
Churchill always thought that the Iron Curtain would break down and central Europe be liberated. He told the 30-year old John Colville, his private secretary, in 1950; "If you live out your natural span, you will live to see the liberation of Central Europe from Moscow's yoke."
He did - and he did.
Two Poles were to play a transcendent part in this triumph, the Pope and Walesa. Stalin himself averred that communism fits Poland like a saddle does a cow. So it proved.

Walesa proves one person can make a difference
It is worth heeding what the survivor of the two now has to say.
Nobel Laureate Lech Walesa, 63, shared his vision of a new era marked by "globalization and intelligence" during an appearance at Brunswick School, in the US, on April 10th. The 1983 Nobel Peace Prize winner and former Polish president told students and faculty that "no other generation has had such an opportunity for peace."
In 1980, Walesa led the Gdansk shipyard strike in defiance of the Polish Communist government, which was then controlled by the former Soviet Union. When the solidarity trades union strike was losing momentum, Walesa scaled the shipyard wall and gave a passionate speech atop a bulldozer, revitalizing the movement. 
This courageous act was one of the defining moments in history, according to John Booth, head of the Brunswick High School History Department. "It is important for our students to know that one person can make a difference," Booth said. Walesa, who was an electrician before he became a political leader, gave a brief primer on his country's history during his talk. Set between Russia and Germany, Poland has a history of invasions. After World War II, the Soviets imposed their repressive, one-party Communist government on his country, which was not a match with the Polish temperament, Walesa explained. 
"When two Poles meet, they form three political parties," he said. "The Soviets imposing their one-party system on Poland was like fitting a horse saddle on a pig." (slightly varying the Stalinist maxim, one may note). The Polish people tried to rebel, but their uprisings were always crushed by the powerful Soviets. "Not one world leader would support our fight for freedom," he said. 
In 1979, Pope John Paul II, the first Polish pontiff, visited his native country and spoke forcefully about religious freedom, which inspired his fellow citizens. "The pope awakened our country," Walesa said. 

Walesa leads workers' revolt 
Shortly afterward, Walesa led his successful revolt for workers' rights, which set off a wave of strikes throughout his country. The authorities were forced to capitulate and then negotiate with Walesa. The result was the Gdansk Agreement of Aug. 31, 1980, which gave workers the right to strike and to organize their own independent union. Within the next decade, the Soviet regime, known as "the evil empire," crumbled, and Poland became a democracy. In December 1990 Walesa was elected president of the Republic of Poland. 
Walesa urged Brunswick students to participate in government, "to vote and get involved so that your grandchildren will not say, 'Where were you?'" In the new millennium, the United States is the only remaining superpower and no one questions American economic leadership, Walesa maintained. However, he raised the issue that the U.S. is now "faced with the task of providing true political and moral leadership." The Polish statesman, currently the head of the Lech Walesa Institute for Democracy and Free Market Reform in Poland, called for expanding and enlarging organizations such as the United Nations to promote global solutions. 
He also raised the possibility of a "globalised parliament" in our era of "Internet and information and wisdom." "Nationalism is a concept of the past," Walesa said. However, he cautioned that "less than 10 percent of mankind owns the global wealth," an economic reality that will not be viable in the future. The major threats facing the 21st century are "racism, anti-Semitism, ethnic cleansing and terrorism," he said. "Under US leadership" we must defend civilisation against these dangers. "The US with its democracy gives hope to the rest of the world," he said. 

Thinking Globally 
After the speech, Booth said Walesa's message about globalisation was an important one for the students to hear. "They need to think globally, to get out of the bubble of Greenwich," he said. Booth added that Walesa's address had a powerful, personal meaning for him, because his mother grew up in Slovakia, just one mile from the Polish border. An important lesson Walesa imparted was that "sometimes you have to stand up and challenge injustice," Booth said. 

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AUTOMOBILES

Booming car sector shrugs off gloomy forecasts 


The Polish car revolution began in 1972 with the manufacture of a small model under licence from Italy's Fiat. The Fiat 126 was immediately the dream of all those in communist Poland yearning for greater prosperity and mobility, New Europe reported. 
The last "Maluch" (dwarf) rolled off the production line years ago, as larger and more luxurious models took its place, but for many Poles that first "made in Poland" car recalls the beginnings of an economic boom. Fiat ceased long ago to be the only car assembler in Poland. Since 1972, the Fiat plant in the southern Polish city of Tychy has produced more than seven million vehicles, and the Italian concern remains the largest car maker in the country, followed by GM's Opel and Volkswagen. 
Today the chances are good that the small postal delivery vehicle seen on the streets of Germany or the car used by the Turkish police originate in Volkswagen's plant in the western Polish city of Poznan. Up to the end of February this year, more than 56,000 vehicles were assembled in five car plants across Poland, 12 per cent up on the same period a year ago. The vast majority - 96 per cent - were destined for the export market. Thus far the statistics contradicted the gloomy prediction at the end of last year from PriceWaterhouseCooper that production was set to fall after years of growth. The main reason given by the consulting firm was that the models on offer from Poland, most of them dating from six or seven years ago, were showing their years and becoming less attractive to clients. 
But the Polish car manufacturers' association (PIM) disagreed with the forecast of a dramatic fall. The sector, taking into account all the suppliers, is now among the most important in the Polish economy, according to PIM director, Rafal Orlowski. According to the associations' figures, around 114,000 Poles were working in the car sector at the end of last year, among them more than 25,000 in car assembly and motor manufacture. At the beginning April, Japanese supplier Nifco announced that it planned to invest 205 million Euro on constructing a new plant in the special economic zone in the Lower Silesian city of Swidnica. The Nifco move came following in the tracks of its partners in the Japanese and South Korean car industry. 
Apart from Poland's relatively low wages and non-wage labour costs, the area is favourably situated for delivery to car makers in Slovakia and the Czech Republic, where major manufacturers like Toyota and Hyundai have built assembly plants in recent years. 
Central European countries are competing strongly for investments, particularly in the vehicle sector. Component suppliers have tended in recent years to set up their plants in eastern Central Europe. In Poland alone there are almost 2,000 small and medium-sized companies supplying the motor manufacturing industry, according to PIM figures. Supplying assemblers both in Poland and outside its borders, they have become one of the country's most dynamic industrial sectors.

Japan's Nifco plans US$250 million investment 

Japan's plastic industrial and car parts manufacturer Nifco plans to invest US$250.4 million in a production facility in Swidnica, southern Poland, the company said. The new plant would become Nifco's third European manufacturing centre after those in Britain and Spain, it said. Industrial plastic fasteners, parts and moulds for the auto industry would be sold to major Japanese, Korean and European auto-makers. Major Nifco customers include Toyota, Nissan, Honda carmakers among others. Technology companies Sony, Toshiba, Sharp and Sanyo also do business with the company, New Europe reported.

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ENERGY

Warsaw presents new energy sector strategy 

Poland's government recently approved a new energy sector strategy that would see several power providers consolidated in an apparent attempt to create a national champion, New Europe reported.
The so-called Polska Grupa Energetyczna - or Polish Energy Group - would combine elements of Poland's national power grid, Polskie Sieci Elektroenergetyczne, power plant operator BOT and energy firm Dolna Odra, according to Prime Minister, Kazimierz Marcinkiewicz. "The idea is to create a strong ... entity that can compete in Central and Eastern Europe," Marcinkiewicz said. He added that work would begin "immediately" to implement the strategy. The announcement came amid a broader push by Marcinkiewicz's conservative and nationalist-minded government to do more to protect national interests within the European Union. It wasn't immediately clear what effect the announcement would have on existing plans to privatise Dolna Odra. The previous centre-left government had agreed to sell an 85 per cent stake in the company to Spain's Endesa SA.

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FOREIGN COOPERATION

Poland-Kazakstan cooperation group meets 

The first meeting of the inter-parliamentary group on cooperation between Poland and Kazakstan with participation of Alexei Volkov, ambassador of RK to Poland, took place in Poland recently.
A decision to work out and adopt an action plan of the Poland-Kazakstan cooperation group for 2006-2007 was made at the meeting, a statement, issued after the summit, said. "In particular, the sides agreed to develop cooperation between the parliaments, exchange visits of MPs, and carry out a number of joint initiatives in education." The Polish side was reportedly informed about political and socioeconomic changes in Kazakstan and acquainted with main provisions of the presidential Address to the Nation as of March 1st. The group includes 26 deputies of the Lower House, the Sejm, and two representatives of the Senate. It is one of the biggest inter-parliamentary groups in the Polish parliament. It unites representatives of many political parties represented in the Sejm ("Law and Justice," "Civic Platform," "Self Defence," "Union of Left Democrats" and "Polish Peasant Party").

Polish president calls for Warsaw-Vilnius cooperation 

Polish President Lech Kaczynski expressed a wish to continue Poland's strategic partnership with neighbouring Lithuania at the start of a visit recently in Vilnius where met his Lithuanian counterpart, Valdas Adamkus.
Speaking to journalists, both leaders stressed the continuance of bilateral relations and giving regional politics new impulses. Topics on their agenda included the upcoming elections in Ukraine and Belarus. The latter was presently far from a real democracy, Adamkus said.
Foreign policy had often been coordinated with Kaczynksi's predecessor, Aleksander Kwasniewski, with whom he had served as a mediator during the Orange Revolution in Kiev, Adamkus added.
Kaczynski also addressed parliament or the Seimas while in Vilnius, and later met with Lithuanian Prime Minister, Algirdas Brazauskas. Their talks focussed mainly on trans-border energy projects, a spokesman said afterwards. 
Kaczynski urged to broaden cooperation and joint enforcement of energy security. The Polish head of state also urged Lithuania to join forces in combating energy security threats, since he said energy sources could lead to a political domination of their recipients.
Kaczynski showed particular interest in cooperation in nuclear energy, according to the spokesman. Adamkus invited Poland to join Lithuania, Latvia and Estonia in helping to build a new nuclear reactor in Lithuania that could help wean the region off Russian energy supplies. "Independence in the energy sector can guarantee our political independence in the future," Adamkus said.
Adamkus invited Poland to join the Baltic states in constructing the new nuclear reactor at Ignalina, some 130 kilometres northeast of Vilnius, where the current nuclear reactor is set to be shut down by 2009. As part of its deal to join the EU, Lithuania agreed to shut the Ignalina plant down completely by 2009.
Polish minorities in Lithuania were the main topics on the agenda of talks between the Polish head of state and Lithuanian politicians. During his visit to Vilnius President Kaczynski underlined that EU membership carries some hazards, like restrictions of the sovereignty, which both Lithuania and Poland regained not long ago.

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FOREIGN INVESTMENTS

Poland seeks foreign investments 

Poland could become the main destination for foreign investors in Eastern Europe if it could put in place the apposite measures required to combat with rivals like Bulgaria and Romania, Adam Zolnowski, the new chief of the Polish agency for investments, commented recently, cited by the daily-news.ro website. 
The agency chief said that Poland could win this race "if it focuses on high value projects." Poland has a population four times larger than Slovakia, the Czech Republic or Hungary and has attracted 60 billion Euro in investments since the fall of the communist regime. International companies showed that bureaucracy, bad infrastructure and corruption continued to be the main factors inhibiting Poland from reaching its full potential.

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FOREIGN LOANS

Poland grants 15m Euro credit to Serbia 

The Polish government recently approved a credit worth 15 million Euro for Montenegro for the financing of small and medium-sized companies and projects in the area of agriculture, the Serbia and Montenegro (SCG) Ministry for International Economic Relations confirmed recently, cited by Serbia & Montenegro Today newspaper. 
The credit was reportedly approved under "very favourable conditions," with an interest rate lower than those provided by Montenegrin commercial banks and a grace period of three years. Serbia Minister for International Economic Relations Predrag Ivanovic said in a statement for the Podgorica daily Republika that the credit agreement would be signed in Warsaw in early April.

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