Boleslaw Kosciukiewicz, minister counselor of the economic section of Polish embassy in China, sees energy as the most promising sector in his country. Zhao Yanrong / China Daily

 

Chinese businesses are seeing plenty of alternative investment opportunities in poland

There are many who regard it as the next big thing and others who are highly skeptical, but for the moment Boleslaw Kosciukiewicz is one of the believers.

We are talking shale gas and its exploitation as an energy source, and Kosciukiewicz, a Polish envoy in China, reckons the two countries have a lot to gain if they work together on this commodity.

In fact, new energy and business services in Poland appear to be particularly ripe with opportunities, and the country's embassy in Beijing says that this year it has received many inquiries from small and medium entrepreneurs looking to invest in the country.

"There is a good political atmosphere after Premier Wen Jiabao's visit to Poland in April and our President Bronislaw Komorowski's visit to China in December," says Kosciukiewicz, minister counselor of the embassy's economic section.

Elevating China's relationship with Poland, the sixth-largest country in the European Union by population and area, to a strategic partnership also raises the country's profile as a target for Chinese investors, he says.

The Polish Information and Foreign Investment Agency says investment from China in Poland reached 633 million euros ($824 million) last year, compared with 250 million euros in 2010. China is the third-largest foreign investor in Poland.

"With China's global development strategy, Chinese companies are eager to get more access to the European market with new management skills and technologies," Kosciukiewicz says. "And we can provide the knowledge and help them to explore the European market."

Kosciukiewicz sees energy as the most promising sector in Poland to invest in at the moment. The country's Geological Institute published a report in March indicating that recoverable shale gas reserves may be as high as 1.9 trillion cubic meters. The country is pinning its hopes on developing the new energy as a way of breaking its dependence on Russian gas.

According to the report, Poland imports 14 billion cubic meters of gas annually, and shale gas reserves could satisfy domestic demand for 35 to 65 years.

The Polish embassy says that when Waldemar Pawlak, the Polish deputy prime minister and economics minister, was in China in May he highlighted his country's interest in joint efforts in exploiting shale gas. He also suggested research institutes in both countries to join efforts in this field.

"Energy is important for Poland as well as for China," Kosciukiewicz says. "These sectors I mentioned for investment have been put forward in the investment guidelines in Poland. The technologies and skills in exploring the new energy are still at an early stage but we welcome all kinds of investment and cooperation in this field."

Poland's economy grew 2.4 percent year-on-year in the second quarter of this year, the Poland Central Statistical Office says; it had forecast growth of 2.9 percent. Growth in the last quarter of last year was 4.3 percent, and the decline marked a slowdown for the economy, the national newspaper Daily Rzeczpospolita said.

However, Kosciukiewicz is bullish about Poland, which was the only one of the few of the 27 EU members to avoid recession after the global financial crisis of 2008-09.

Poland is also one of the most educated in the EU. Kosciukiewicz says that with a strong domestic market, low manufacturing overheads, and not being dependent on a single export sector, "Poland is still energetic in its further development".

Last year exports to China were worth about 1.35 billion euros and imports from China were worth about 13.2 billion euros. Trade grew 5 percent, making China the third-biggest source of imports for Poland last year, behind Germany and Russia.

China is ready to double trade with Central and Eastern Europe, including Poland, to $100 billion (76 billion euros) a year by 2015, China's Premier Wen said when he met his Polish counterpart, Donald Tusk, in April.

During his visit, Wen said Beijing would set up a $10 billion line of credit to support investment in specific industries such as infrastructure, high technology and green technologies in the region. He also pledged an additional $500 million in funds available for Chinese companies seeking to make initial investments in Central and Eastern Europe.

"I think Premier Wen's announcement makes not only Poland but the whole region visible to Chinese investors and distinguishable from other countries from the EU," Kosciukiewicz says.

In March, Huawei, the Chinese global telecommunications technology solutions provider, celebrated its 10th anniversary of entering the European market, in Warsaw. Kosciukiewicz sees the company as a model of Chinese investment in Poland, as technology, culture and education work together.

In 2006 Huawei Technologies Co Ltd set up its headquarters in Poland, covering 24 countries in Central and Eastern Europe and Scandinavia.

Philip Gan, CEO of Huawei Poland, says Europe, including Poland, is a key market for the company, "not only because of its 100 operators serving 741 million subscribers, but also because it is a place where main technological trends develop".

Over the 10 years Huawei has undergone a transformation, from an Asian company little known in Europe, to a major global supplier.

"This success would not be possible without the support and trust of our partners and clients," Gan says.

As Chinese investment has poured into Poland, Chinese financial services have also been opening up operations there. Last month Bank of China set up shop in Warsaw, making it the first Chinese bank in the country.

The bank quoted Pawlak, the deputy prime minister, as saying the bank's branch in Poland will help promote economic, trade and financial ties between China and Poland.

zhaoyanrong@chinadaily.com.cn

(China Daily 09/20/2012 page20)