POLAND
Economy recovers / GDP up 3.6% / Plastics processing has above-average share of industrial production / Infrastructure needs developing / Will EU membership affect small businesses?
In 2003, Poland´s economy regained its footing. With 3.6% growth in gross domestic product (GDP) to about EUR 378 bn, the country improved on the 1% growth rate of the previous two years. In the first quarter of 2004, GDP grew by 6.9%, which is comparable to the levels achieved during the 1990s. The country´s accession to the EU on 1 May 2004 is expected to fuel the currently positive development.
After three rather meagre years, Poland´s industrial production picked up by 8.5% in 2003, with plastics processing holding a clearly overproportionate share of this development. The Polish Central Statistical Office GUS (www.stat.gov.pl) reported over 20% growth for plastics processing companies with more than 50 employees. These companies represent 70% of the industry´s total sales volume, which amounted to significantly more than EUR 4 bn, following the previous year´s EUR 3.5 bn. At the same time, the number of employees rose by 7% to 90,000.
The positive development in the plastics processing segment also influenced import figures for plastics machinery and equipment. In 2001, imports of capital goods for this industry amounted to a value of EUR 180m and in 2002, the figure dropped to about EUR 149m. Last year, however, imports recovered and the value of imported machinery and equipment rose to EUR 226m. The lion´s share of imports, about EUR 106m, comes from Germany – Poland is currently the eighth largest customer for German plastics machinery. Most in demand are injection moulding machines, which account for EUR 71m, followed by extruders with EUR 25m and blow moulding machines with EUR 11m.
In Poland, as elsewhere, injection moulding is the dominant processing method for plastics. Almost 50% of companies in the Polish plastics industry manufacture products in the “other” category, and most of these are injection moulders. Estimates place the number of injection moulding shops anywhere between several thousand and 13,300. Some 24% of Polish plastics processing companies supply the building industry, 22% the packaging industry and 5% are producers of sheet, pipe and fittings, which may go into several sectors. In the latter three categories, the dominant processing method is extrusion or blow moulding.
A closer look at size distribution within the market uncovers an interesting phenomenon. Although companies with more than 50 employees represent only 16% of the plastics processing industry, they account for clearly more than two- thirds of its turnover. This seems to indicate a rather haphazard proliferation of very small companies in the initial euphoria of the post-communist period, hardly likely to be sustained under the new conditions of EU membership.
The trend towards consolidation is already evident in the plastics processing sector – the four leading suppliers of the Polish construction industry are subsidiaries of the western European players Wavin, Rehau, Aluplast and Veka, with traditional domestic companies farther down the list. This trend is even more obvious in the packaging segment, where the top ranks are dominated by such well-known international players as Alpla, CeDo, Huhtamaki, Knauf, Amcor, Bericap and many others.
The distribution of production value within product categories clearly reveals what drives Poland´s economy. Sheets, panels, pipes and fittings account for almost 30%, while construction materials represent 29%. More than half of production value is thus concentrated in the infrastructure segment, followed at some distance by packaging with 24%. The rest is distributed across a variety of applications. All of these figures make it clear that Poland is only in a few cases an extended workbench for Western companies. On the contrary, it is the potential that the Polish domestic market offers that is attractive to investors. Infrastructure is just a start.
Another interesting thing about Poland is that does fit the usual stereotype of a largely agrarian country. While agriculture accounts for only about 3% of GDP, industrial production represents 31% and the service sector generates 66%. These figures are very similar to those of Western service-oriented economies. Thus, Poland may be expected to catch up with the older EU members a lot faster than has been generally expected.
After three rather meagre years, Poland´s industrial production picked up by 8.5% in 2003, with plastics processing holding a clearly overproportionate share of this development. The Polish Central Statistical Office GUS (www.stat.gov.pl) reported over 20% growth for plastics processing companies with more than 50 employees. These companies represent 70% of the industry´s total sales volume, which amounted to significantly more than EUR 4 bn, following the previous year´s EUR 3.5 bn. At the same time, the number of employees rose by 7% to 90,000.
The positive development in the plastics processing segment also influenced import figures for plastics machinery and equipment. In 2001, imports of capital goods for this industry amounted to a value of EUR 180m and in 2002, the figure dropped to about EUR 149m. Last year, however, imports recovered and the value of imported machinery and equipment rose to EUR 226m. The lion´s share of imports, about EUR 106m, comes from Germany – Poland is currently the eighth largest customer for German plastics machinery. Most in demand are injection moulding machines, which account for EUR 71m, followed by extruders with EUR 25m and blow moulding machines with EUR 11m.
In Poland, as elsewhere, injection moulding is the dominant processing method for plastics. Almost 50% of companies in the Polish plastics industry manufacture products in the “other” category, and most of these are injection moulders. Estimates place the number of injection moulding shops anywhere between several thousand and 13,300. Some 24% of Polish plastics processing companies supply the building industry, 22% the packaging industry and 5% are producers of sheet, pipe and fittings, which may go into several sectors. In the latter three categories, the dominant processing method is extrusion or blow moulding.
A closer look at size distribution within the market uncovers an interesting phenomenon. Although companies with more than 50 employees represent only 16% of the plastics processing industry, they account for clearly more than two- thirds of its turnover. This seems to indicate a rather haphazard proliferation of very small companies in the initial euphoria of the post-communist period, hardly likely to be sustained under the new conditions of EU membership.
The trend towards consolidation is already evident in the plastics processing sector – the four leading suppliers of the Polish construction industry are subsidiaries of the western European players Wavin, Rehau, Aluplast and Veka, with traditional domestic companies farther down the list. This trend is even more obvious in the packaging segment, where the top ranks are dominated by such well-known international players as Alpla, CeDo, Huhtamaki, Knauf, Amcor, Bericap and many others.
The distribution of production value within product categories clearly reveals what drives Poland´s economy. Sheets, panels, pipes and fittings account for almost 30%, while construction materials represent 29%. More than half of production value is thus concentrated in the infrastructure segment, followed at some distance by packaging with 24%. The rest is distributed across a variety of applications. All of these figures make it clear that Poland is only in a few cases an extended workbench for Western companies. On the contrary, it is the potential that the Polish domestic market offers that is attractive to investors. Infrastructure is just a start.
Another interesting thing about Poland is that does fit the usual stereotype of a largely agrarian country. While agriculture accounts for only about 3% of GDP, industrial production represents 31% and the service sector generates 66%. These figures are very similar to those of Western service-oriented economies. Thus, Poland may be expected to catch up with the older EU members a lot faster than has been generally expected.
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09.12.2004 Plasteurope.com [201208]
Published on 09.12.2004