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The Warsaw Voice » Other » June 11, 2008
The Silesia Voice
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Steel Strengthens Silesia
June 11, 2008   
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Last year, steel production in Poland exceeded 10.5 million metric tons, or 320 kg per capita, testifying to growing demand for metallurgical products. All industries that need large amounts of steel increased their output last year.

Over the past two decades, the Polish steel industry has been privatized and restructured, which has boosted its competitiveness and made Silesia an increasingly attractive region for investors.

"A modern and restructured metallurgy sector has become one of the main assets of the Polish economy," says Silesia Province Governor Zygmunt Łukaszczyk. "In recent years, Poland has become a steel powerhouse, and that is the reason why our region is attractive to investors."

Projects by ArcelorMittal Poland are a case in point. Last year alone, the company's strategic investment projects in Silesia exceeded zl.3 billion, including a continuous steel casting line in D±browa Górnicza, a steel sheet coating line in ¦więtochłowice, and a wire rod mill in Sosnowiec. By the end of 2009, ArcelorMittal Poland plans to invest more than zl.4.2 billion in Silesia. Jerzy Podsiadło, vice-president of the board and director for restructuring and integration at ArcelorMittal Poland, says that, as a result of restructuring the country's metallurgy industry, outdated facilities have been shut down, and modern technology has been introduced, adapting the industry to global standards. The prospects of the Polish steel industry are promising, despite European Union carbon-dioxide-emission quotas and impending price hikes for raw materials and energy.

But emission limits do not discourage investors. Severstallat, the owner of the Technologie Buczek factory in Sosnowiec, launched the Severstallat Silesia company this May. "We believe that the Polish market is a promising one," said Alexei Gogunov, president of Severstallat SA and member of the board at Severstallat Silesia. "We have been present on the Polish market for four years as a product supplier. Last year alone, our sales in Poland amounted to 20 million euros. We chose Silesia as a location for investment due to its large number of steel processing companies and highly qualified staff."

Over the next three years, Severstallat plans to invest some 20 million euros in Sosnowiec. It will open a service and maintenance center for clients based within a radius of 300 kilometers. Around 600 jobs will be retained in Sosnowiec owing to the project.

The Polish market is also attractive to Ukrainian investors. The UGMK mining and metallurgical company has been a shareholder in GCB Centrostal Bydgoszcz since 2004. UGMK manages a Hungarian network of service centers for Dutrade steel products and is building its own retail network in the Czech Republic, Russia, Belarus and Georgia. "However, the most important sales center will be located in Poland, in the Silesian city of Sosnowiec, where a modern service center will be built," said Vytaly Gnatushenko, a UGMK board member. "The center will provide services for the majority of EU countries."

Gnatushenko says the Polish market is an attractive one and it is worth investing here. Robert Agh, president of Ferona Polska SA, a company based in Mysłowice, supports this view. "We are witnessing rapid economic development in Poland, owing to EU financial support and other factors," he said. "The situation in the construction and transport infrastructure sectors has improved markedly when it comes to investment."

The Ukrainian Industrial Union of Donbas, the owner of ISD Huta Częstochowa steelworks, has benefited from the increased demand for steel. "We are hoping for further growth on the market in connection with the infrastructure projects that Poland will have to carry out over the next five to seven years," said Konstanty Litvinov, president of the ISD Polska company owned by the Industrial Union of Donbas. "We have earmarked more than zl.400 million for new investment projects in the steel mill. We will also compete for contracts for projects related to the Euro 2012 soccer championships to be held in Poland and Ukraine. We produce steel structures that are an integral part of construction projects involving facilities such as stadiums or bridges."

Renata Dudała, New Industry
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