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Prof. Stanisław Gomulka, the Deputy Minister for Finance was the guest speaker at the meeting, which was hosted by Dr. Paweł Wojciechowski, the PAIiIZ president.

In 2007 the Agency completed 57 investment projects, due to which 18 thousand workplaces were created. When compared to 2006, the Agency recorded an increase in all of its areas of operations. Not only were 57 investment projects realised - 14 more than in 2006, but also a 200 million EUR increase in capital investments was recorded last year.

- Of the success of the Agency in 2007 testified not only the record number of projects executed, but also the marked increase in advanced technology projects - said Dr Paweł Wojciechowski, the PAIiIZ President.

Minister Gomułka summed up the economic situation in Poland and its 6.5% GDP growth in 2007. - The results are very good and these were the results we expected - he said. In his opinion the rate of growth for 2008 will be close to 5.5% expected by the government in the budgetary act. - We expect that on an annual scale the average inflation rate will reach app. 3.5% - the minister added.

The most capital was invested by American firms - 387 million EUR. Japan was in second place in terms of investment capital (280 million EUR), and their fall from first place in 2006 was noted. In third place was Great Britain (77 million EUR). However, in terms of the number of investment decisions, Japan was placed in equal first place with the USA (8 each). The investors most eagerly located their investments in Dolny Śląsk (10), in Mazowsze (8) and in the Łódzkie voivodships (8).

Among the 57 projects, the most (13) were related to the sector of electronics and the value of these investments reached 492 million EUR. As a result of which, 8.5 thousand jobs will be created. In the sector of service centres, 11 projects were finalised, of a joint value of 30 million EUR and an estimated employment figure of 3,600 workplaces. The value of the eight investments in the automotive sector is 230 million EUR, resulting in the creation of over 2,300 jobs. The Agency also realised four projects in the chemicals sector (of a value of 135 million EUR) and in research and development (1.7 million EUR), which will result in 510 and 310 new jobs respectively.

The initial estimates provide a very favourable account of last year. The forecasts for Poland’s economic development are very good; and the interest in Poland from foreign investors isn’t slackening. As it appears from PAIiIZ’s figures, Poland is achieving increasing regard among investors from the US and Asia. The largest share of FDI inflow to Poland remains of origin from the EU countries (88%), however this proportion should steadily decrease in favour of American and Asiatic firms.

The city has declared, that over a six month period it will implement all the necessary legal requirements, so that the government will be able to take the decision to create such a sub-zone in Białystok. Mr Grzegorz Mackiewicz, the president of the SSEZ has stated that 7 firms have proposed investments that would bring in a total of app. 1,000 new workplaces to the city.

The local authorities now need to change the district’s planning regulations affecting the several hundred hectares of land, which is to be brought into the zone; together with providing the investments plots with utilities. Mr Tadeusz Truskolaski, the president of Białystok, stated that 7 million PLN would be invested this year.

The president believes that a Białystok sub-zone of the SSEZ is a good idea, as it would enable the local authorities to entice investors to locate their enterprises there in particular.

The SSEZ has been in operation for ten years and today there are five sub-zones under its control: in Suwałki, Ełk, Gołdapia, Grajewo and Malkinia. The companies operating in the Zone provide 4.3 thousand workplaces.

- We forecast a 5.5% growth in the rate of GDP in 2008, though the quarterly figures may vary somewhat - the Deputy Minister said. She also added that according to the ministry’s initial estimates, the GDP growth for IV quarter of 2007 was 6% as opposed to 6.4% in III quarter.

On Wednesday the Central Statistical Office (GUS) stated that the GDP growth for 2007 was 6.5% as against 6.2% the year before.

The investment rate within the economy (i.e. the ratio of gross capital investment to fixed assets, at current prices) was 22% as against 19% a year earlier. The analysts surveyed by the ISB Agency also expect that economic growth will be at a level of 6.5%.

INVESTMENTS IN POLAND

Dell is the largest investment in the Łódź Special Economic Zone and also the investor that has created the most new work places. Today the computer assembly plant employs 1,200 workers, yet according to the permit theses numbers will grow up to a figure of at least 2,000. The first Dell computer marked with “made in Poland”, left the production lines on 20^th November 2007, which is exactly a year after the laying of the Łódź plant’s foundation stone.

The new Dell works has a surface area of 37 thousand m² , being built from an investment of 200 million EUR and is the most modern plant constructed by the company worldwide. As a result of this investment, the Company’s clients from Central and Eastern Europe together with Scandinavia can expect a shortening of delivery times by at least two days.

Mr Michael Dell has said that he has no doubt that Łódź is an excellent place for an investment: - We looked at the whole of Europe and it turned out that we found the best personnel in Łódź. They’re talented, ambitious and educated, while in addition the city offered a pleasant environment for the firm. Mr Dell also promised that he would recommend the city to his suppliers.

The company intends to set up a business based on the processing of metal sheeting for the needs of the agricultural industry, within the Chojnów sub-zone. 60% of its production will be exported, mainly to the eastern European markets (Belarus, the Ukraine and Russia).

This is the second permit issued by the LSEZ this year. A week earlier the Lenovo company were issued with a certificate and have located their plant in the Legnickie Pole sub-zone, where their production target is for over 2.6 million personal computers each year; the value of the investment is 15 million PLN and 1,300 staff are to be employed there.

Two firms have already begun their operations - Sweedwood and the IKEA Group (furniture manufacturers in the Wielbark sub-zone) and the Baur Publishers (printers - the Ciechanów sub-zone). At the Mrągowo sub-zone, work has been begun by companies that were awarded permits in 2006, e.g. Polish Asphalt - the producers of bitumen substances and Majak - the manufacturers of measurement apparatus. The surface area of the W-MSEZ was enlarged by 176 ha last year.

In January 2008 they plan to conclude negotiations and issue a permit to the Finish paper manufacturer - Stora Enso, who are to locate themselves in the Ostrołeka sub-zone. Their declared capital investment is 1.2 million PLN and they will create app. 100 workplaces.

They will also be striving to tempt investors to the attractive sites that were added to the zone in 2007, these are plots located at Iława (a victor in the Grounds for a Medal 2007 competition), investment sites in Elbląg (Technology Park) and in Mława.

There is an increase in interest from Russian businessmen in the areas that are located next to the border, where on sites included in the Zone warehousing facilities could be created for goods imported from Poland, together with countries from the west and south of Europe. We have begun talks with the Russians and we expect this project to be completed next year.

There’s also a careful monitoring of the fate of the companies which belonged to the Schneider Group, which went bankrupt last year. Some of them have already been sold off by the syndicate of Polish manufacturers; others still have no new owners. We’re ready to include these firms within the Zone, in order to increase their attractiveness for potential purchasers by providing them with tax breaks.

At the end of 2007 18 sub-zones were united under the Zone, in 2008 they plan to continue the strategy conducted last year - of tailoring the locations to the needs of the investor. On the basis of talks conducted both with the investors and the local authorities, they plan to create new sub-zones in Nidzica, Stawiguda, Olsztynek, Pisz and Giżycko.

The Labour Market: The Ministry of Labour confirmed that the unemployment rate for January was maintained at a rate similar to that of December and is 11.3-11.4%.
The unemployment rate for December rose to 11.4% from 11.2% in November.

- Unemployment in January will be between 11.3 and 11.4%. We have a mild winter - said Ms Czesława Ostrowska, the Deputy Minister of Labour. She also confirmed that unemployment at the end of 2008 would be at 9.8-9.9% - in accord with the forecasts of the budget.

- Unemployment will fall and at the end of the year will be at 9.8-9.9%. This will allow funds to be released that will be targeted for activating the unemployed. It must be remembered, that when there’s a slump in the economy its effects are delayed over time. However such fluctuations as at the end of the XX century no longer threaten us - she said.
GDP: According to the initial estimates of GDP for 2007, it was higher in real terms by 6.5% than in 2006 - it appeared from the published figures of the Central Statistical Office (GUS).

In 2006 as against 2005, GDP growth was recorded at 6.2%. From the predictions of the Ministry of Finance that in the IV quarter of last year GDP grew by 5.9%. Whereas throughout the whole of 2007 in the economy a 6.4% growth rate was noted, which will slacken to 5.3% over 2008, in I quarter GDP growth will be 5% and in II quarter 5.5%.

Exchange rates (as of 31.01.2008):

	Buy	Sell
USD	2.4201	2.4689
EUR	3.5779	3.6501

Source: www.nbp.pl

ANALYSES AND REPORTS

Investors break records

The UN Conference for Trade and Development issues (UNCTAD) prepared a report, in which it was shown that 2007 was a record year for foreign direct investments (FDI) across the world. Their value was estimated at 1,500 billion USD. The previous record of 1,400 billion USD was reached in the year 2000.

As the report states, the financial fluctuations from the second half of last year didn’t disrupt FDI. It was shown that their largest recipient was the USA; the value of their FDI was 193 billion USD. In second place was Gt. Britain with investments of 171 billion USD, followed by France with 123 billion USD. The EU as a region was the largest recipient of foreign investments last year - with 40% of the total.

Among the developing nations the largest destination for FDI was China, even though the investment figure had dropped from 69 billion USD in 2006, to 67 billion USD in 2007. However investments in Hong Kong increased by over 25%; increasing from 43 billion USD in 2006, to 54 billion USD in 2007. Evenly placed in joint third place were Brazil, Mexico and Singapore which each received FDI of 37 billion USD.

However the UNCTAD report somewhat dampens the enthusiasm, it is not certain that there will be another record in 2008. The flow of direct investments may become somewhat stifled, due to “the maintenance of external imbalances in the scale of world trade, sharp fluctuations in the exchange rates, increases in interest rates, ever increasing inflationary pressure and also high and unstable prices for raw materials”.

Further information: www.unctad.org

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