POLAND - Economic Newsletter  January 24, 2005

         Have a Great and Prosperous New 2005 Year !


 Toyota - production of engines and automatic gearboxes in Walbrzych

Toyota Motor Manufacturing Poland in Walbrzych has started production of engines and automatic gearboxes for all Toyota and Peugeot-Citroen cars manufactured in Kolin, Czech Republic. Gas engines of the volume less than 1,000 ccm will supply models: Toyota Aygo, Peugeot 107, and Citroen C1. The production capacity of Toyota Poland in Walbrzych exceeds 300,000 gearboxes and 250,000 engines annually. The manufacturer supplies other Toyota production plants in France, Great Britain, and Turkey with gearboxes for Toyota Avensis, Corolla and Yaris. The recent Toyota’s investment accounts for $400M.

Another Toyota plant in Jelcz-Laskowice, Poland will supply European Toyota’s production with Diesel engines. Its annual capacity is estimated at 150,000 Diesel engines. Toyota’s strategy indicates Southern Poland as the main supplier of engines and gearboxes for this corporation.



5-year outsourcing contract between IBM and Polkomtel

Polkomtel - the operator of the Plus GSM mobile network has signed an agreement with IBM to develop its IT supporting management system mySAP. The contract of the value of $12M starts the 5-year cooperation between these two companies. Implementation of IBM technology will result in a 10 percent cost cut. The outsourcing agreement encompasses vital procedures for the functioning of the company. IBM will take care of everyday maintenance of SAP and integrate it with other IT systems as well. IBM sees this deal as part of its long-term strategy. Around 60% of IBM revenues in Poland come from services and software. Outsourcing remains IBM core business.



Automotive Industry in Poland

318 thousand brand new cars were sold in Poland and 811 thousand second-hand cars were imported to Poland in 2004. The main auto suppliers in Poland are:

- FIAT - 16.7%

- SKODA (Volkswagen Group) - 12.3%,

- TOYOTA - 10.5%,

- OPEL (General Motors Group) - 10.0% of the Polish market.



Bridgestone to build a factory in Zarow for EURO12M

Japanese tire producer Bridgestone Corporation will build a factory of rubber caterpillar tracks for EURO12M in Zarow, near Wroclaw, Bridgestone Europe spokesman Gert Meylemans said.

Production in the new factory will start in July 2006. Initial employment will be 50. Bridgestone also plans to build a new tire factory for $500M. One of the possible locations is Poland.



Leading tile manufacturer Opoczno SA on the market

Opoczno SA, the biggest tile manufacturer in Poland is going public. The current owners of 99% of shares, Credit Suisse First Boston Ceramic Partners and Enterprise Investros approved the public offer after 70% increase of profits for the last year. The main competitors on the Polish tile market are: PARADYZ, CERSANIT and CERAMIKA Tubadzin. Together with Opoczno, these four companies constitute 84% of the Polish tile market and successfully compete with foreign producers. This is an increase from 60% level in 2000.



Poland - Economy in brief

· The annual average inflation should drop below 3% in 2005 from 3.5% in 2004 while the GDP should grow 5% against 5.6-5.7% in 2004. Current account deficit should be around 2% of the GDP (Ministry of Finance),

· Poland's foreign trade deficit after November 2004 fell to EURO10.7B from EURO11.5 after November 2003. Exports in the surveyed period rose 24.8% to EURO54.3B. Imports rose 18% to EURO65B (Central Statistical Office),

· Polish radio broadcasters booked a 20.5% (comparing to 2003) rise in commercial time earnings to $330M in 2004. The leader was RMF FM with $100M, the second was Radio Zet, the third the Polish Radio One (CR Media),

· The Finance Ministry paid $60.1M and EURO12.2M worth of foreign debt interest and $346M and EURO123M in principal in December 2005. Also in December credits of the "pool" type were repaid to the World Bank ahead of schedule.


 

Outsourcing and Investment Opportunities in Poland

    

    For economic information on the Polish market potentials please contact:

 

 

Polish Information & Foreign Investment Agency ul. Bagatela 12 00-585 Warsaw, Poland tel.: (+48 22) 334 98 00 fax: (+48 22) 334 99 99 e-mail: post@paiz.gov.pl

Commercial & Economic Division Consulate General of the Republic of Poland 12400 Wilshire Blvd. # 555 Los Angeles, CA 90025 tel.: (310) 442 – 8500 x 114 fax: (310) 442- 8526 e-mail: kozak@consulplla.org