Manufacturing in central Europe’s leading economies continued to grow in May, with PMIs in Poland, Hungary and the Czech Republic indicating continued expansion, although Poland appeared to show some impact from declining exports to Russia and Ukraine due to the fraught political situation in those two countries. Read more
Nothing like a foreign policy crisis to concentrate the mind.
Poland’s potential adoption of the euro, which had been pushed off to the end of the decade under political, economic and constitutional difficulties and lacklustre public support, has been given a jolt of energy by Russia’s creeping invasion of Crimea. Read more
Lviv’s Vienna Café is serving up revolution with its cakes and coffee. Half of the restaurant in the centre of the west Ukrainian city has been turned over as a command centre sending bus loads of activists to Kiev every evening to take part in the protests there.
“Of course I’m losing a bit of business but we have to do what we can to help the movement,” says Oleg Mandiuk, the café’s owner, speaking on his mobile phone as he drives towards Kiev. Read more
Central Europe’s leading economies have strapped on afterburners, with new manufacturing PMI data released Monday showing a strong recovery in Poland, the Czech Republic and Hungary.
In Poland, the region’s largest economy, the improvement in business conditions was the strongest in three years. The headline PMI number, in which anything above 50 marks an economic expansion, came in at 55.4 for January, up from 53.2 in December. Read more
Poland’s economy turned in an unexpectedly strong performance last year, growing by 1.6 per cent according to data released Thursday, but that did not stop the zloty from losing strength against the dollar and euro amid continued emerging market worries.
The economy’s expansion surprised on the upside – most analysts had pencilled in only about 1.5 per cent growth. The final result for the year was also significantly higher than had been expected just a few months ago, when first quarter growth slowed to only an annual 0.5 per cent. Read more
New World Resources ended trading Friday down by 3.4 per cent, capping off a terrible week that saw the Czech coal miner’s shares plummet by 22 per cent the day before.
Hit by lower coal prices, a failure to extend its revolving €100m credit facility and a reassessment of its coal reserves, NWR announced late Wednesday that it was taking a closer look at its capital structure. Read more
Amazon’s Christmas season was marked by labour unrest at its German warehouses, and as the US retail giant expands into central Europe, building five centres in Poland and the Czech Republic, it is hoping that unions do not follow.
“In terms of unions themselves, we don’t see a need for that,” Tim Collins, director for Amazon´s EU logistics operations, told beyondbrics. “Any friction that gets between us and our associates slows down innovation, slows down change, slows down improvements on the shop floor, and we don’t see that as being good at all.”
However, the Solidarity labour union, heir to the organisation that helped end communism in Poland, plans to support any unionisation drive among Amazon’s Polish workers. Read more
Real estate can be an alluring post-crisis investment. Just ask punters who poured money into the US market a couple of years ago, or those now sniffing around Spanish property. The same applies to central European real estate, which last year saw a 31 per cent increase in investments, to €10bn.
That makes 2013 the second busiest year for transactions since pre-crisis 2008. Read more
The weather in central Europe tends to be unspectacular but not unpleasant; the region’s economic forecasts for 2014 are starting to look a lot like its weather forecasts. Read more
For most people becoming finance minister is a huge professional promotion – for Andrej Babis, whose fertiliser-to-media empire has made him the Czech Republic’s second wealthiest man, it will mark a bit of a comedown.
Under a preliminary agreement to create a new coalition government, Babis looks set to take over the finance ministry, one of his demands to bring his newly formed Ano party into the government. Read more
Russian financial aid often comes with strings attached, and pumping Russian money into a dysfunctional economy only helps in the short term, a lesson that Belarus is learning and that Ukraine should keep in mind as it mulls the $15bn aid package recently signed in Moscow. Read more
The boys and girls of central and eastern Europe have been pretty good this year and Santa looks like he has some goodies in his sack for the region over the upcoming year.
A look at a raft of end-of-year analyses of the CEE region shows that the gloom that was afflicting the region last year has largely lifted. Read more
Poland’s central bank has already indicated that there is not much chance of it increasing record-low interest rates before mid-2014, and Friday’s unexpectedly low inflation readout will do little to change that assessment. Read more
Initial public offerings, especially those tied to privatisations by Poland’s treasury ministry, have the reputation for being money spinners, but there is no such thing as a risk-free investment, as punters are learning on Wednesday on the Warsaw Stock Exchange. The shares in Energa, the country’s third largest power distributor, sagged in the first hours of trading.
Energa launched on the WSE in a privatisation worth 2.4bn zlotys ($787m), the bourse’s largest IPO in two years. Read more
Poland’s troubled Lot Polish Airlines is getting a helping hand from Boeing: the US aircraft manufacturer stuck an agreement with the carrier, which had complained about losses incurred after two of its 787 Dreamliner planes were pulled from service due to faulty batteries. Read more
Poland’s parliament may have rushed through a dramatic change to the country’s pension system in only four days last week, but the revamped pension scheme still faces possible legal and constitutional challenges.
Poland became just the latest CEE country to take an axe to a pension system that became popular across the region a decade ago, but is being revamped or rejected because running costs have turned out to be significantly higher than predicted. Read more
Poland has the EU’s best growth record in the last five years, but there is a growing awareness that keeping growth high is going to be increasingly difficult in the future – which is why two recent reports on corruption and educational achievements make such good news. Read more
Central European manufacturing continues to show signs of strength in new purchasing managers index reports released on Monday, indicating that the region is rebounding from the slowdown it experienced late last year and in the first half of this year.
In Poland, the largest CEE economy, manufacturing came in at its strongest level in more than two years. The PMI index, where anything above 50 indicates expansion, was 54.4 in November, up from 53.4 in October. Read more
The strong showing by Poland’s economy in the third quarter of this year includes encouraging news for Poland bulls: domestic demand is an increasingly important factor in an economy that has been largely sustained by export growth.
New details on the economy come from the government’s statists agency, which took a closer look at earlier released flash GDP numbers. Those showed the economy expanding by an annual 1.9 per cent in the third quarter, up from 0.8 per cent in the second quarter. Read more
Cut the coal, please
Krakow was known for its choking smog in Communist times, when Poland’s medieval capital was bathed in the corrosive stench being pumped out by the nearby Lenin Steelworks.
Fast forward a quarter of a century, and Krakow’s air is still polluted – although the culprit is no longer the steel mill (now owned by Arcelor Mittal) but instead the thousands of people who still heat their homes with coal. The result has been some of the worst air in a still-smoggy country where coal generates about 90 per cent of Poland’s electricity. However, the local government in Krakow is now moving to ban home heating with coal over the next five years. Read more