UK Enterprise Ltd
Suite 1 Staple's House, Eleanor’s Cross, Dunstable, Bedfordshire LU6 1SU
tel +44 (0) 01444 220980
fax +44 (0) 01444 459680
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UK Enterprise Ltd Suite 1 Staple's House, Eleanor’s Cross, Dunstable, Bedfordshire LU6 1SU tel +44 (0) 01444 220980 fax +44 (0) 01444 459680 |
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Poland - Water & Waste WaterIntroductionPoland constitutes a market of 38 million people located in the heart of central Europe, sharing borders with both “new” EU and “old” EU-15 countries and markets to the East including Ukraine, Belarus and Russia (Kaliningrad oblast). It has become a fully integrated member of the EU since its May 2004 accession, adhering to common economic, structural and commercial policies, including adoption of the common external tariff regime. Poland’s accession to the Schengen free transit zone in December 2007 eliminates all remaining border checks along its intra-EU frontiers.
The largest of the new accession countries in terms of size and population, Poland is also the biggest recipient of EU funds, receiving €67.2 bn for 2007-13. With economic growth, a young and well-educated labour force, and located at the crossroads between Eastern and Western Europe, Poland offers a large potential market. In the UK and Ireland, bilateral trade and contacts with Poland are growing. In 2008 the UK retained its position as Poland's fourth largest trading partner and Poland remained the UK's largest export market in central and Eastern Europe. Total value of trade amounted to £7.1 billion, up 19% against to 2007. Irish and Polish companies have also made a good use of new business opportunities emerging after Poland’s accession to the EU. Bilateral trade between both countries has been growing in the last couple of years at an annual rate of more than 25% and the combined Irish-Polish trade turnover came to a total of almost €1.5 billion in 2008, with a growth of over 43% of Irish exports to Poland. A convenient start-up point for UK and Irish companies planning to expand to the East because of its strategic location between the EU and the emerging markets further East, Poland is seen not only as an attractive local market, but also as a gateway to other Central & Eastern European countries. Poland’s economy grew at a rate in excess of 6.5% during 2007-2008. It has enjoyed 17 straight years of economic expansion, individual consumption and increased business investment, including new foreign direct investment totalling approximately €15 billion in 2007. In the first quarter of 2009 real GDP grew by 0.8% year on year, broadly in line with expectations, making Poland one of the very few EU countries to register any growth in January-March. Although the zloty has fallen by 30% from its peak, the central bank has cut interest rates from 6% in October to 3.75%, Poland faces the crisis in a stronger position than many other countries. The consumption of 61% of GDP in 2008, close to Western levels, and rapid wage growth and low debt made consumers more robust. The $20.5 billion credit line from the IMF, not a bail-out like those for Ukraine, Hungary and Latvia, was a precautionary and unconditional overdraft offered only to top-quality borrowers. The prediction is that the economy should return to growth in 2010. Market OverviewThe total cost of upgrading the Polish water and sewage system is estimated at €14 billion up to 2015, in order to meet EU requirements. Up to 300 wastewater treatment plants need to be constructed, 430 collective sewage and wastewater systems and 19,000 km of water pipelines need upgrading and modernisation, and a large portion of the sewer interceptor network needs replacement. Sixty per cent of Polish citizens are connected to the sewage network: 84% in cities and 16% in rural areas and a target has been set for 100% coverage by 2015. Sludge treatment is also a major issue. The Government’s top priorities are to improve the quality of drinking and bathing water, and to increase the number of waste water treatment plants. Major expenditures for water management infrastructure are necessary to ensure that water supply and wastewater related infrastructure comply with European directives. The Local Self-Government Act of 1990 transferred responsibility for water and wastewater services to municipalities. Along with the transfer of assets and the freedom to reorganise institutional structures, water and wastewater enterprises have also acquired the responsibility for improving and expanding services, and, as traditional central government subsidies have been eliminated, raising the necessary funding for capital investments as well as meeting maintenance and operating costs. These reforms have provoked a significant demand for water companies, contractors, consultants, manufacturers and suppliers of specialist machinery, equipment and materials, which are not available locally. Funds for Water Sector ProjectsFrom the beginning of 1 May 2004 Poland became eligible for cohesion and structural Funds. Out of €67 billion allocated for Poland in 2007-2013, €27.8 billion will be spent on Infrastructure and Environment. It is most of the Structural Funds committed to Poland for 2007-2013 (36%) and the whole allocation of the Cohesion Fund. It is 40% of all EU available for Poland until 2013. The Ministry of Regional Development has prepared the National Strategy for Infrastructure and Environmental Protection 2007-2013 and will administer both cohesion and structural EU funds and transfer all applications to the European Commission. The Strategy sets out priorities for allocating EU and home funds in 2007-2013. In the area of Environment funds must be spent on setting up a flood-control system, as well as the development of water management, wastewater treatment, upgrading garbage treatment and disposal as well as for projects to help enterprises adapt to environmental protection requirements and to promote ecological awareness to the public. The Programme priorities in the area of the water sector are as follows:
It is estimated that around €1.0 billion every year will be allocated for environmental projects, the majority of which will be spent on improvement of the surface water quality, quality of drinking water, distribution and flood control system. Market Trends & Legal RegimeThe Local Self-Government Act of 1990 transferred responsibility for water and wastewater services to municipalities. The larger municipalities have established autonomous but wholly-owned Municipal Water Companies that have responsibility for all operational matters. They work closely with Municipal governments on the development of new investment projects. The Water Companies in the larger towns are becoming more commercially oriented and are developing commercial skills as well as their traditional technical skills. This has resulted in a greater willingness to adopt innovative ideas and products including those that come from outside Poland. The large Water Companies are marketing their services to neighbouring smaller municipalities to increase their customer base and improve efficiency. Expansion of services will require modernisation and implementation of advanced and more efficient technologies in the water, wastewater and sludge treatment processes. Poland’s ground water resources comprise an annual supply of 1,600 cubic meters per capita. Currently, only 6% of the average water runoff is collected in approximately 140 reservoir basins with a capacity exceeding 1million cubic meters. However the situation is generally improving. Water consumption has decreased by 22.5% in the last ten years, water quality has improved, and the amount of treated wastewater has increased by 77.6%. Water supply systems are connected to 97.6% of all households in Poland. Almost 100% of Poland’s urban population uses common water supplies while only 55% of the rural population has access to water supply systems. The key water management regulation in the European Union and in Poland stems largely from the following Directives:
These regulations are benefiting many markets, for example: the market for pumps for the water and wastewater industry is expected to grow 5 to 10% annually until 2012. Comparing the status of water resources throughout Europe, Poland is among the least developed. Although Poland has ample water supplies, there are intensive activities to be undertaken for improving water balance and its structure, primarily in rural areas. In 2002 the Polish Supreme Board of Control conducted research on the quality of the water supply. The results indicated that quality in two thirds did not meet water standards described in binding regulations. Only 28% of underground water intakes had a first class level of clarity, while 65% met third class or even lower levels of clarity. The study also showed that the quality of water deteriorates with the length of the water piping system. Many water piping systems are 50 to 100 years old and require immediate exchange or renovation. There are many tasks related to water management to be undertaken and continued in Poland. Works related to the construction of water reservoirs and water flow control devices in the basin of the Vistula and Odra rivers are ongoing. In order to improve ground water resources, the state plans to develop a network of small reservoirs to postpone water runoff to the Baltic Sea. In terms of total water production, 44% of treated water volume originates from surface water intakes and 56% from underground intakes. While comparing the number of water treatment facilities, 87% treat underground water and only 13% treat surface water. Surface water treatment technology in Poland is characterized by two and three point application of chemical oxidation, mainly ozone treatment that appears in alternating sequence with coagulation, adsorption, rapid filtration and biological filtration processes. These are the most common used surface water treatment processes in Poland:
Polish underground water has a high content of ferrous metals and manganese. Very often small water intakes are not capable of solving this problem. Almost 35% of water treatment stations have problems with elimination of manganese. Also such micro components as arsenic (As>0.01 mg/dm3), fluorine (F>1.5 mg/dm3) and antimony (Sb>0.005 mg/dm3) occur often in some ground water reservoirs. Most ground water treatment technologies used in Poland are based on oxidation and rapid filtration. In small water treatment facilities, the most commonly used technology is pressure filtration as well as pressure aeration. Additionally, chemical oxidants such as chlorine, chlorine dioxide, potassium permanganate or ozone are often used in order to enhance the oxidation process. Industrial EnvironmentPoland’s industry faces enormous environmental challenges, but this situation presents opportunities for western companies with the equipment, advanced technology and know-how that Poland requires. The most promising areas are water and wastewater treatment, waste disposal, recycling technology, and air pollution control. These priorities were discerned from World Bank estimates of the total expected costs to the Polish economy over the next 15 years for meeting EU accession requirements in the overall area of the environment. These include: $25-40 billion in the water sector, $7.7-11.5 billion for air pollution, and $2.2-3.3 billion in recycling and solid waste management. Key SectorsPoland does not manufacture specialist water sector equipment and there are therefore opportunities for western manufactures to sell specialist goods and equipment in Poland. Examples include monitoring and measuring equipment and sludge treatment equipment. There are also openings for providers of specialist services, particularly those relating to pipeline rehabilitation and no-dig technologies. This particularly applies to the UK consultants established in Poland. Those consultants not already involved in the water sector are encouraged to enter this market. The high level of project implementation, stimulated by the availability of EU grant funding, is generating opportunities on the project preparation, design and project management. The key sectors include:
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