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The Warsaw Voice » Other » June 20, 2007
DENMARK IN POLAND
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A Win-Win Situation
June 20, 2007   
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Søren Juul Jørgensen, head of the Economic and Commercial Department of the Embassy of Denmark in Warsaw, talks with Jolanta Wolska.

How many Danish companies operate in Poland?
There are about 500 companies in Poland. Some have been here for quite some years. There are three groups of companies: one that outsources production, such as Faber-who produce blinds and curtains and have moved production to Poznań; then we have Danes who come here to sell their products, such as Ecco shoes; and Danish design companies. We have almost 300 companies registered with the embassy but there are also many more that are working on their own here.

What is the balance of trade between Poland and Denmark?
We are almost neck and neck. In 2006 Denmark's goods and services exports to Poland totaled 13.38 billion euros, and Poland's exports to Denmark in the same period were 13.36 billion euros.

Poland is Denmark's 12th biggest trading partner. The biggest are Germany and Sweden. But we see Poland moving upwards, and it is our ambition that we want Poland to be in the top five as quickly as possible. It is quite obvious that as the Polish economy develops Poland will be as important as Germany and Sweden is today. It will be one of our three or four biggest trading partners.

The Danish Trade Office in Poland is the biggest of all Danish trade offices around the world. Why, if Poland is only the 12th largest partner?
That is because there is so much activity here. If you look at one of our other big trading partners, their trade has been established over many years. Here we still have new companies coming to Poland to either establish their services or production. That means that for a trade department we have more work here to service those companies.

Denmark is one of the biggest investors in Poland. And we intend to remain so. We are one of the top 10 investors. And up in the West Pomerania region Denmark is still the biggest investor.

What is stopping more Danish companies from entering the Polish market?
The Danish company structure is such that most Danish companies are small to medium-sized. And therefore they do not always have the necessary extra capacity to deal with administration and the rules as they are. Therefore, they are very happy to see that reforms in Poland are also progressing in this area.

What particular areas of Polish bureaucracy are causing difficulties for the Danes?
Some of the rules that have not been changed over the years, as for instance the tender rules and tendering for contracts. The legal system, where the procedure is quite lengthy that companies have to go through. And the smaller and medium-sized investors are very interested in the quick processing of their applications, because that hits their liquidity and other business decisions. But that is an area where a lot is happening in Poland. There are new rules on public procurement, there's a lot happening in the judicial system.

Of course, the basic impediment is the language.

What draws Danish companies to Poland?
I think for Danes Poland is interesting for various reasons. Some is that they cannot find labor force in Denmark. Unemployment in Denmark is about 3 percent and that is a motivating factor for many to move here. The price is also a motivator, but more so is the Polish market. It is not only a matter of coming here because production is cheaper than in Denmark, but because they are interested in the Polish market. And that is a medium- and long-term look at the Polish situation. And then they come here because Denmark has particularly good know-how in areas such as energy and the environment that can help Poland.

Danish electricity-generating wind turbines have been in Poland for quite some time.
Yes, we hope more will come. But that is exactly an area where Denmark has progressed a lot, and has the companies with the know-how that should be interesting for Poland. So they come to Poland. In Denmark we have managed to have an increase in production without an increase in energy consumption.

Denmark in fact has reduced its energy consumption since the early 1970s.
Yes, that was the background. Currently, we are doing a campaign with the Polish Ministry of Economy on energy efficiency. It is the same in the area of the environment. It is the Danes' particular area of expertise.

In which spheres of environmental technology is Denmark involved in Poland?
In the area of water management. We have several engineering companies established here. That is, they have competence in the area of management of sewerage systems, separation and cleaning of water-both software for controlling that and also pipes, filters and other equipment. And in consulting engineering in building and managing these systems.

Other countries are also entering this area, but we can take the competition. There is room for many suppliers because there is a lot going on in Poland. Denmark started early in the environment area. Denmark was first in the world to have a separate ministry for the environment. And they started setting very high standards for Danish industry very early through the '60s, '70s and '80s so, they had a long time to build up expertise. From the technological point of view Denmark has highly competitive products and they have been used for many years.

Is Denmark is self sufficient in energy and food?
Yes it is.

What does Denmark need to import? What can Poland offer Denmark?
Food. Even though Denmark is traditionally a farming area.

We have been through the adaptation processes in the '60s and '70s, increasing the size of farms and machinery. In fact, Denmark is an exporter of farm products. But there is definitely room for Polish products. Also, there are Danish slaughter houses in Poland. In other food-related areas there is also good cooperation between our countries. But Danish industry is more know-how based and we outsource a big share of our production, including to Poland.

So Danish products made in Poland are being imported to Denmark as well as those of Polish companies.

There are a lot of food products from Poland but we do not always know that they are Polish brand products.

If you were to be asked by the Polish government what it could do to encourage export to Denmark, what would you suggest?
Electronics products that come from here [should be encouraged], the good processed food from Poland. And in many areas there are opportunities for excellent joint ventures, particularly in the area of design.

Poles have artistic flair, while Danes have expertise in product design: could that make for an excellent joint venture?
Yes, that could be an interesting area for cooperation. And also in other areas, such as in bio-tech areas. Poland has a very high educational level and very well educated people in those areas.

What about tourism , the fastest growing industry in the world?
We have the Danish Tourist Board here. That is a growing area. Many Poles know many tourist sites in Denmark. There are very many flying routes between our countries, and there is a cheap route between Copenhagen and Warsaw, and we have many direct routes each week to Poznań, Cracow and Gdańsk as well. There is an increasing number of Poles working in Denmark.

Is there a large Danish population in Poland?
It is quite big, although we don't know for sure because they are not registered here. But we estimate that there are almost 3,000 Danish people living in Poland.

How did the controversy over the caricatures of the Prophet Mohammed affect Danish trade and its image?
It had some instant negative effect and it could have been handled better afterwards. But since then there has been action to improve understanding between other cultures. There was an immediate short-term impact on Danish trade in specific countries. But this has rebalanced and readjusted itself.

Denmark has a Muslim population, there are Iranians, Turks and Somalis. How does Denmark cope with such very different cultures, especially when the country's population is so small? There are just over 5 million Danes.
As is the case in most other European countries that have had an influx of people of other cultural backgrounds, this has of course posed challenges for the integration and co-existence of Danes. And it does pose challenges of how to cope with integration and how to manage having different cultural sets of values within a society. Policies have been put in place in the past years to promote this integration to ensure that young, second-generation immigrants with different cultural backgrounds are employed, because the general perception is that it is through employment in the work place that effective integration takes place, because that is where the real exchange of values takes place.

You're a lawyer by profession. How does a lawyer become a trade attaché?
That is because the trade counselor of Denmark is an integrated part of the Ministry of Foreign Affairs and it is part of our diplomatic work. I am a standard diplomat, I have worked with European Union matters for my first 10-12 years in the ministry. And then I took leave from the ministry.

You were setting up a company in Poland in fact.
Yes, we were working to establish an IT project in Poland. In the meantime we were bought out by IBM, so the project fell through. But we got as far as having found a Polish company to be our partner and we had identified the customers. So we were more or less ready to start.

Why did you at the time choose Poland?
For the same reason as other Danish companies come here. Poland is a big and interesting market and it is close to Denmark. And for many Danish companies that closeness is important because it is easier to handle the distance. So it was an interesting market for us in the IT services area.

You said language is a problem. How difficult is it for Poles to learn Danish?
As difficult as for Danes to learn Polish. There are three places where Danish is taught, at the universities in Poznań and Gdańsk and in the Danish Institute in Warsaw. So it is possible. And there are also quite a few Polish-speaking Danes who either learned it at school, or through families who have settled in Denmark. And we have more and more Polish-Danish mixed families. Generally, we see an increase in the interest in both countries-not only on the commercial side, but also on the cultural side.

What is more fascinating for you, the work in the legal area, which is your background, or business and trade?
Business and trade definitely. There is much more dynamism to it. It is very dynamic, even more so now because there is an economic optimism in the business layers in Poland. There is the confidence in investment, not only foreign but also from local investors.

How different do you find the culture and mentality between Denmark and Poland?
I think the differences aren't as big as they look. There are more common areas. Both countries have a sense of humor, both are quite direct, although perhaps Danes are a bit more direct than Poles in business dealings. I know there is a perception that Danes are not very open, but I think that is a myth. Danes are actually quite open and I have noticed that Poland is a very open society. Danes are very approachable. The similarities are definitely greater than the differences.

We can also observe that where Poles are employed by Danish companies here. And the experience there has been very good. The high quality Polish labor has been appreciated.

There is also a very good and positive experience with the Polish people working in Denmark now. They are very highly appreciated there, not only because they fill a labor gap, but also from direct experience at the workplace.

So it's a win-win situation?
Yes.
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