Since the collapse of communist rule at the end of the 1980s, Poland has reshaped itself to emerge as one of the fastest growing and most successful of the former-Comecon countries. The plastics industry is one area which is benefitting from the new economic freedoms with the emergence of a sector estimated to involve between 4,000 to 6,000 companies employing in excess of 35,000. However, these companies cover a diverse variety of businesses ranging from the remnants of the old state combines to small family-owned craft workshops. Applied Market Information Ltd (AMI, 45-47 Stokes Croft, GB-Bristol BS1 3QP) has just published a new directory which details the activities of over 1,200 of Poland's most important processors, including the leading private ones, as well as the companies set up or invested in by foreign business.

The current success of Poland's plastics sector in part stems from the historical development of the industry. Even under Communist rule, there existed in Poland many small private businesses manufacturing consumer goods, using injection moulding and extrusion technology. In general though the industry was dominated by huge state-owned organisations. These have now undergone substantial restructuring and reorganisation and some have managed to re-emerge as thriving businesses. Such companies have either become limited (Sp.zo.o) or joint-stock (S.A.) companies. Shares in the latter are available through National Investment Funds or on the Warsaw Stock Exchange. The Treasury still owns all the shares in a certain number of joint-stock companies as a transition measure, and these companies still dominate many areas of the industry. In materials handling, sheet extrusion, profile extrusion and food packaging, the ERG Group which was formerly a consolidated state-owned group, accounts for the major share of the market. For example, it is estimated that they manufacture three-quarters of the Polish requirement for plastic crates and former ERG-concerns dominate the building products market (window profiles, pipes etc). Other former state-owned operations include the Inco-Veritas companies. Four of the five plants which operate under this name have been successfully privatised and the companies have a strong position in plastics packaging.

Packaging is the one sector which has probably seen the highest level of foreign investment, although automotive and electronics are areas increasingly attracting interest. Leading foreign packaging companies which have plants in Poland include Akerlund & Rausing, which acquired one of Poland's largest film extruders Pakpol S.A. earlier this year. Also active in Poland is Europe's largest blow moulding group Alpla which has two plants, as well as Continental PET (PET bottles), Linpac Plastics (EPS food trays), Bericap (closures) and Polarcup (sheet extrusion).

The fast growth of the Polish economy and the need for building products for infrastructure projects, has attracted all the leading West European pipe producers. Wavin, Uponor, KWH and Mabo are all active in the region. As a result of its acquisition of key Polish automotive manufacturers, the South Korean Daewoo group operates three plants for the manufacture of components. A number of Italian component suppliers have also invested in Poland to supply the Fiat Cinquecento plant at Sosnowiec, including Ersi Poland sp.zo.o (owned by Ergom) and Lys Fusion which has a plant jointly owned with ITW Fastex.

Despite the growth in foreign investment the vast majority of Poland's plastics industry is made up of small, private companies although it also has a strong cooperative sector, which includes some large concerns. These cooperatives are among the firms which seem to have survived the transition to a market economy most effectively. Many often employ disabled staff and have "Protected Labour Employer" status. This is important as such employers are exempt from the statutory Disability Fund contributions, a saving they can pass on to their customers. An excellent, but by no means isolated example of a quality cooperative manufacturer is Spoldzielnia Inwalidow Wiosna Ludow, with a workforce of 400, polymer consumption of 3,500 t/y for injection moulding with almost exclusive Engel capacity (55 machines) manufacturing precision technical mouldings for the automotive and electrical industries.

Injection moulding is, as one would expect, the most common process operated in Poland. Of the companies listed in AMI's directory 48% are carrying out injection moulding, a further 23% do film extrusion and 10% pipe and profile extrusion. Packaging is the largest market accounting for about 45% of demand.

Despite attempts by the Polish petrochemical industry to modernise and expand capacity, the plastics industry is still heavily reliant on imports for nearly all resins. Only in PVC can domestic production meet local demand. Total commodity resin demand is estimated at 870,000 t for Poland in 1996 with polyethylene (all types) accounting for 300,000 t of this and PVC 260,000 t. Demand is estimated to have grown by around 12% over 1995, with particularly strong increases in PVC thanks to the buoyant building products market.

Plastics processing in Poland offers many opportunities in what is now regarded as Europe's fastest growing economy. Increasing demand for consumer and other goods will see demand surge, although capacity and technology constraints among local processors may limit those growth prospects and also lead to further investment by foreign companies.

BOOK SERVICE: "AMI's directory of plastics processing in Poland" (English), 1997 edition, 274 pages, A4 format, paperback, price DEM 550.00 (+postage/VAT): PIE-No. B 41573.