In June this year, for the first time in 12 years, the President of the People’s Republic of China visited Poland. Xi Jinping’s visit should result in greater economic cooperation between the two countries and the initiation of talks between Polish and Chinese companies.
So far, Chinese investments in Poland have been rather modest. In December 2014 there were 884 Chinese capital companies in Poland. However, the Polish Central Statistical Office reports that most of them were small enterprises. According to calculations of the National Bank of Poland, Chinese investments in Poland by the end of 2014 were worth nearly 443 million dollars, which amounted to just 0.2 percent of foreign investment in Poland.
However, a growing involvement of Chinese capital can be observed. Chinese companies have begun to feel more comfortable in Poland. This can be seen in one of the flagship Chinese investments: Huta Stalowa Wola. It was acquired by LiuGong, one of the largest heavy equipment companies in China. Similarly, two years ago, Fabryka Łożysk Tocznych in Kraśnik was acquired by Tri-Ring. The Chinese have also invested in Animex, a Polish meat products manufacturer, owner of brands such as Krakus, Morliny and Berlinki.
So far, Chinese investments in Poland have been mostly based on mergers and acquisitions. This, however, is beginning to change. In early July, the Polish Information and Foreign Investment Agency reported that Chunxing Group, a Chinese manufacturer of aluminium components, has launched its prototype workshop in Gdańsk. The Gdańsk facility is supposed to optimise the warehouse and logistics service for European customers and deliver prototypes in a relatively short time. Five experts working in the fields of CNC machines, logistics, warehousing, quality assurance, project management and development are currently employed in the workshop. “By the end of the year, we are going to recruit more specialists from the region,” says Sebastian Czuryło, Chunxing’s Executive Director in Poland, as quoted in a press release.
The first stage of the Gdańsk investment project has been almost completed. The company does not rule out the possibility of further investments in Gdańsk. The strategic premise is to build a large manufacturing plant in Europe within the next 3 to 4 years. Naturally, Gdańsk is one of the first locations which will be taken into consideration. According to Steve Sun, responsible for the coordination of Chunxing’s growth in Poland, the location of the plant was determined by Gdańsk’s geographical location, investment climate and availability of local workforce. “The proximity of our key partners in Western Europe makes Central and Eastern Europe an extremely convenient location for investment projects,” explains Steve Sun.
“The flow of investment will be facilitated by the development of Polish infrastructure,” says Joanna Choromańska, Business Development BTS Manager, JLL. According to the Polish Information and Foreign Investment Agency, Poland can become a transport hub within Europe’s relations with China. In just a few months of 2016, the number of containers transshipped in Małaszewicze increased sixfold. In May, the PCC Intermodal terminal in Kutno launched a regular connection to China. From there, Chinese shipments are sent to Rotterdam, Hamburg and Berlin. “For Chinese companies, Poland is increasingly becoming a gateway to the European market,” adds Joanna Choromańska, JLL.
Another city with considerable ambitions is Łódź, which has previously launched a railway connection to Chengdu in China. This direct railway link and further investments are supposed to help Łódź become an infrastructural superhub in the land part of the New Silk Road which will run across Europe. During the Poland-China Business Forum in Warsaw Marek Michalik, the Head of the Łódź Special Economic Zone argued that Łódź will be the future location of a logistics and science park, while new investors can count on the help of a special Chinese unit and the extension of assistance provided by the Zone to new projects.
At the Poland-China forum, the first economic event accompanying the official visit of the President of the People’s Republic of China Xi Jinping in Poland, several contracts between enterprises from the two countries were signed. Additionally, a cooperation agreement was signed by the Polish Agency for Information and Foreign Investments and the China Council for the Promotion of International Trade.
Business Development BTS Manager
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