A balanced relationship

She speaks with the WBJ on the recent spike in trade between Denmark and Poland, why Danish companies find Poland such an attractive investment destination, and in what sectors Danish firms will be investing their capital in the future

Michał Pakulniewicz: What is the overall state of Polish-Danish economic relations?

Susanne Hyldelund: So far, 2005 looks to be a good year when we look specifically at exports from Denmark to Poland and vice versa. To start, I must mention that we have very balanced trade between the two countries. At the end of 2004 it was around EUR 1 [zł.3.9] billion each way. Trade between the two countries has been steadily growing - by a few percentage points annually in the last few years - but the balance has been pretty much the same. This year, if we look at the first eight months, seems to be different. Danish exports to Poland have grown by almost 30 percent and Polish exports to Denmark by about 12 percent. I'm confident that this year is going to turn out to be the best year in our mutual trade.

What is the reason for this years' rapid growth of trade between the two countries?

A lot of the growth has been driven by the food and agriculture industry, especially the meat sector. A lot can be contributed to Poland's entrance to the European Union, which was a real eye-opener, as Poland is now perceived as a neighboring, accessible country. We now see more small and medium-sized enterprises trying to enter into the Polish market, not only the larger companies like at the beginning of the 1990s.

What about Danish investments in Poland?

We are among the top ten investors in Poland measured in absolute numbers. But in terms of the sum invested per capita Denmark is one of the top five investors in Poland. Danish investments in Poland not only create workplaces in the country, but also contribute to the growing export out of Poland. This perhaps could explain why in the last years exports from Denmark to Poland have not been growing significantly. The main sector where Danish companies invest are food and agriculture products, and this year we saw a significant investment from Royal Unibrew, which bought a few breweries in Poland, and metal processing. The largest Danish investor in Poland is Statoil, which is originally a Norwegian company, but the investment in Poland is done by its Danish subsidiary. We have to keep in mind that the PAIiIZ list of foreign investors only includes investments of over $1 [zł.3.33] million. And for Danish companies that is a lot of money, so I expect the actual value of Danish investments to be higher than the list shows.

What brings Danish companies to Poland?

The competitive production environment is definitely a big incentive to invest in Poland. Danish companies are very much aware of their global competitiveness and the need to survive as a Danish company and maintain Danish workplaces. They know that they need to outsource and they need to produce at a competitive level, therefore they choose China, India or Poland. By choosing Poland you also gain access to a huge domestic market. Many companies also feel that by establishing business here they can gain access to the Ukrainian and Russian markets. 

Interviewed by

Michał Pakulniewicz