Embassy Events 2006
 |
Ambassador Ashe addresses the American Chamber of Commerce in Poland |
Ambassador Ashe Addresses American Chamber of Commerce in Poland
6 October 2006U.S. Ambassador to Poland Victor Ashe
Remarks at the American Chamber of Commerce in Poland Breakfast Meeting
October 6, 2006
Good morning everyone. I would like to thank AmCham Chairman of the Board Roman Rewald and Executive Director Dorothy Dabrowski for inviting me again this year to speak to your membership. I always look forward to opportunities to meet with the U.S. business community.
In Poland today we are living in interesting times, especially considering the events of the past few weeks. The current coalition government is struggling to put its house in order and get its administration back on track. As a part of this process, there may be new elections in the near future. Such a situation creates some uncertainty. In such an environment, it can become more difficult to do business or to get things done. But you should know that the fundamentals of Polish-U.S. relations remain solid—just look at recent decisions by President Kaczynski to send additional troops to Lebanon and Afghanistan, and his ongoing commitment to Iraq—and I know you still have overall confidence that Poland is a good place to invest.
In contrast to some uncertainty on the current political scene, the Polish economy seems to be in robust form, moving ahead at a healthy pace. GDP growth in 2005 was a respectable 3.4% and this year it has accelerated to about 5%, with a similar rate of growth expected for 2007. In this regard, Poland is certainly the envy of many of its Western European neighbors. Our bilateral trade is also healthy, with total U.S. exports to Poland in 2005 of $1.2 billion and U.S. imports from Poland of $2 billion. In particular, foreign direct investment seems to be quite buoyant. Counting U.S. investments filtered through third country subsidiaries, the total stock of U.S. FDI has reached roughly $15 billion and annual inflows in 2005 approached $700 million. I am hopeful our numbers for 2006 will be even better. Our European and Asian friends are also investing heavily here. The major industrial countries of the world seem to be continuing the trend of establishing significant production and distribution facilities in Poland that are part of a regional plan, taking advantage of the dynamic Polish market and beyond. And our U.S. companies are in the forefront of this trend. This seems to be a vote of confidence both in the market and the region, even if there are some political question marks in the short term.
After more than two years as U.S. Ambassador to Poland, I am pleased to see significant progress in one of my primary goals, which has been to raise our bilateral commercial relationship to a higher plateau – to reach the level of other bilateral sectors, such as the political and security relationships. In recent weeks we have seen new investments announced by Dell and Sikorsky Aircraft, new expansions by 3M, IBM and Colgate-Palmolive, and the list goes on. The Embassy Team and I have been working hard on these efforts and we appreciate the continuing support of AmCham, our key private sector partner in this endeavor, providing critical assistance to us in major trade and investment policy and advocacy issues. I understand that AmCham continues to grow, with a total current membership of 322, with 20 new members in the past year.
From the information technology and consumer goods sectors to the defense and aviation sectors, U.S. investment has been quite active. Major investments include Dell’s new manufacturing plant for computers in Lodz, which was announced just last month. The value of this investment will reach over $200 million dollars and create between 2000 and 3000 new jobs directly, and possibly many more indirectly. Construction has already started and the first PC could come off the line before the end of next year. To highlight the significance of this investment for the Poles, Prime Minister Kaczynski was present at the signing ceremony in Lodz and made very positive remarks about how Poland welcomed foreign investment and that his government would do everything it could to help Dell be successful.
Defense sector cooperation is also growing significantly. A great example is United Technologies Corporation’s Pratt and Whitney’s $300M jet engine effort in Rzeszow, where Poland is assembling its own jet engines for its $3.8B F-16 program. Recently Sikorsky Aircraft and the Polish Agency for Industrial Development signed an MOU to enter into a strategic partnership with PZL Mielec, with a view to eventually acquiring this Polish aviation manufacturer. If this deal is completed as planned, which we expect in the next few months, it will lead to the establishment of production here for International Black Hawk helicopters. The Sikorsky commitment to Poland would involve the transfer of some of the most sophisticated helicopter technology in the world and would include 100s of new jobs. Sikorsky has also pledged to help with the development and sale of one of Mielec’s existing products, the Sky Truck fixed wing aircraft.
Other recent, significant U.S. investments include expansions of existing facilities for 3M and Colgate-Palmolive in Wroclaw. In Krakow, IBM has launched a software solutions laboratory and Gillette/P & G has a new plant in Lodz. When fully ramped up, Gillette and its partner companies will employ more than 3000 people in what could turn out to be the largest such factory in the world. These are but a few of the many examples illustrating the close and flourishing economic relations that are currently bearing fruit both for Poland and the U.S.
With all of this new investment from the U.S. and other major industrial countries in the dynamic Polish market, we are beginning to hear from many of you about certain difficulties in finding the right kind of qualified employees for your expanding operations. Is there a looming labor shortage developing, perhaps in certain sectors and regions of the country? This seems counterintuitive with current unemployment at around 15%. But labor markets are complicated creatures and often do not function as a smoothly running system, fulfilling the requirements of industry when and where needed, especially in a rapidly expanding economy like Poland’s. However, with the robust pace of both foreign and domestic investment in a growing Polish market, and the continuing exodus of many young Poles to work in other parts of the European Union, perhaps there are problems developing. Maybe this should be a topic of discussion for the U.S. and Polish business communities, the Embassy and the Polish Government? These are the problems of success, however, far preferable to the alternative of high unemployment and low wages.
I would like to share with you some of the things we have been working on over the past year and some of our plans for the coming year. The U.S. Embassy has been energetically engaged in advocating on behalf of U.S. business. One of our priority areas includes the healthcare sector, where we are trying to promote market solutions to Polish healthcare problems. Just last month we hosted a high-powered, 32-member U.S. healthcare industry delegation from Nashville, Tennessee. We are also aggressively pursuing fair and transparent market access for U.S. pharmaceutical companies. Few new, innovative drugs are currently available in Poland and we are trying to convince the Polish Government of the long-term benefits of adding as many of these life-saving new drugs to the reimbursement list as possible.
While the protection of intellectual property does not seem to be the problem it used to be, as adequate laws and regulations are in place, the focus now seems to be on the need for effective enforcement of those laws. This is a message we try to communicate to the Polish Government as often as possible. Biotechnology in agriculture is another issue we are discussing with Polish officials. U.S. agricultural companies are world leaders in this sector and it is our belief that farmers and sound science should decide how biotechnology is used. We will continue to work with the Polish Government bilaterally and in the context of the European Union on market access and regulatory transparency in this area. And we are continuing our advocacy efforts on behalf of individual U.S. companies from a range of industries, including real estate, electric power, telecommunications, automotive, aviation and others.
We don’t hesitate to raise many of these issues, as appropriate, with our senior Washington policymakers, and with the most senior levels of the Polish Government. U.S. Commerce Secretary Gutierrez discussed many of these issues with selected Polish Government Ministers when he was in Warsaw last January, and again when he met with Prime Minister Kaczynski in September in Washington. More recently, Commerce Assistant Secretary Bohigian was in Warsaw at the end of last month as part of our Economic/Commercial Dialogue with the Polish Government, a regular series of inter-agency meetings that alternates between Washington and Warsaw. He raised a broad range of trade and investment issues during our Dialogue meetings and individually with selected senior officials at the Ministries of Health, Economy and Treasury. At the invitation of Commerce Secretary Gutierrez, Minister of Economy Wozniak will visit Washington at the end of November to continue these discussions.
Energy security in general and the diversity of energy supplies in particular, are of critical interest to the U.S. Government around the world. As we all know, these issues are also of keen interest to the Polish Government. As part of Minister Wozniak’s upcoming visit to Washington, the Poles have asked us to organize a U.S. energy industry roundtable. The purpose of this event will be to bring together senior executives from leading U.S. energy companies with their Polish counterparts and have practical discussions on possible ways that our companies can work together in Poland and in third countries. Of course U.S. energy companies will make their plans based on the individual merits of specific business proposals and current market opportunities, but I am hopeful that our companies will have fruitful discussions that will lead to mutually beneficial cooperation in the future.
During the coming year we will be busy with a number of activities to promote U.S. trade and investment interests and perform increased outreach to the U.S. and Polish business communities. During the first week of February 2007, I am planning another business outreach visit to the U.S. As some of you are aware, this will be my third such program since I have been here. This past March I led a delegation to Los Angeles, New York City and Hartford. Next February, I will go to San Francisco, St. Louis and Atlanta. For this upcoming trip, we will try to focus, among other things, on a new area, the investment banking and venture capital communities. We believe that we should be able to generate considerable interest in the Polish market on the part of U.S. businesses in these sectors. If you have any ideas for our program regarding sectors to target or related to any of these three cities, please get in touch with my Commercial Counselor, John McCaslin, who is in charge of planning this trip.
The defense and security industry sectors in Poland continue to experience outstanding growth, with ever-closer cooperation between our two governments and businesses. The leading defense and security industry trade show in the region, MSPO Kielce, is a great event and gets better every year. I know because I visited the show last month. The range and scope of industry offerings and the extent of practical cooperation are phenomenal. I am looking forward to next year’s show with even greater anticipation, as the U.S. will have “lead nation status.” Our Office of Defense Cooperation and the Commercial Service will take advantage of the event to raise the profile of our U.S. companies in these sectors even more and also encourage closer cooperation between our two governments.
In a related area, there are specific government procurement opportunities on the horizon, such as the recently announced Ministry of Health tender for helicopters for emergency services and what we hope soon will be a much larger tender for military helicopters from the Ministry of Defense. The Embassy will work hard to support any interested U.S. companies in pursuit of these tenders.
Finally, to an area near and dear to my heart: infrastructure development, or to put it more specifically, roads and the pressing need for more of them. Last February, the Embassy sponsored the visit of a U.S. Department of Transportation highway specialist to Poland to share his expertise with his Polish counterparts. And just this week, the Embassy organized a visit to Warsaw of Washington State Representative Edward Murray, Chairman of the Transportation Committee, who is meeting with the Polish Government and private sector. We hope that this dialogue, and the ideas generated through these discussions, may lead to further infrastructure planning and development in Poland – to the benefit of all: Polish citizens, Polish business…and U.S. and other foreign investors. It may be too early to expect that “all roads will lead to Warsaw” – but perhaps those that do will be smoother and wider!
In closing, I will continue to do my best to maintain an active dialogue with AmCham and the U.S. business community. We have a great Embassy Country Team, and I encourage you to continue to engage with us at many levels – directly with me and my Deputy Chief of Mission Ken Hillas, and especially with our Economic, Agricultural and Commercial Sections. We value your input and support.
As I said at the beginning, we are living in interesting times, with considerable uncertainty, but like most Americans, I am an incurable optimist, and I am confident that if we all work together we can continue to achieve success in the dynamic Polish market.
Thank you for giving me this opportunity to speak with you today.
